Hundreds of people start small businesses. These business ideas include working toward financial independence and creating a home-based business that allows you to work from home while raising kids. Women entrepreneurs top the list. According to the 2019 State Of Women-Owned Businesses Report, the number of women-owned businesses climbed 21% between 2014 and 2019.
But not every small business is positioned for success. You could be in for a challenge when you decide to start a business and become a business owner. It's a challenge to juggle home, family, another job, and a new business. Being SMART starts at the onset. Following a business startup plan can set the foundation for success.
Starting a business with a plan is a good beginning. To be a Smart Entertrepreneur requires some awareness and logical steps. Let's review those along with those outlined by most business startup sites.
Let's look at important steps to start a business successfully. Included you will find a SMART STEP to growing your business. Consider the SMART steps in your new business venture. That could save you time, money, and failure.
Step 1: Startup Business Ideas
Most likely you have a business idea. Most new entrepreneurs start with a passion or hobby and want to grow that into a business opportunity. That's a great idea! Now it's time to balance it with a SMART plan. Does your idea have the potential to be a viable business? You may crochet the best sweaters but there are hundreds of sweater creators on Etsy.com already. Can you make a living with your hobby that will become income-producing?
Consider these questions:
Does your business idea solve a problem?
Is there a need you can fill?
Do you offer something the market demands?
New entrepreneurs go to Facebook and ask friends and Facebook groups about their proposed product idea. Friends and Facebook Groups tend to be overly optimistic and agree that your idea is a winner. When you launch, you expect all those people to buy your product or service.
SMART IDEA: Find others who are succeeding in your business idea. Examine their website, business plan, and success. Compare your idea to their business model and make it a bit better. Make sure you add your personal touches. If your competition uses a red and blue theme on their website and you like blue and purple, go with blue and purple.
Here's an example: John Lee Dumas is the owner of EOFire.com a highly rated podcast show and seven-figure entrepreneurial business. I highly recommend his podcast and journals. He shares his business startup story often. Over 8 years ago, he created a daily podcast. He has never missed a day!
If you are considering a podcast for brand recognition or to help grow your business, you might want to check out his site. It's quite a commitment to make 365 podcasts a year. Seeing his success can help you figure out your business strategy. Plus, you may learn some great business tips from his guest speakers.
You have your idea. It solves a problem or need. The market needs or wants your product or service. Now what?
Step 2: Make a Plan
You need a plan to make your business idea a reality. Answer some simple questions, and it will point you in the direction for success.
Is this product/service online or in-person?
Would you be marketing to businesses or the public?
Does your business require inventory?
If so, how much?
Do you need to store it?
Does it expire?
Are there startup costs?
These are a few simple questions that should get you thinking about your next steps in starting your business.
SMART IDEA: Start small and test your product with one or two items. Samples are a great way to get some feedback before spending hundreds or thousands of dollars. Store products or supplies in your home or garage. Delay renting a storage unit or signing a lease for a storefront.
If you are providing a business service like a virtual assistant or Facebook Ads developer, try offering a few samples of your work for testimonials. This leads to great reviews and allows you to perfect your skills.
Step 3: Add some financial creativity
Starting a small business doesn't have to require a lot of money, but it will involve some initial investment. It makes sense to keep track of your initial costs for any legal licenses, education, and product you may need. Don't plan on getting a loan if you don't have to. Starting with a loan when you do not have business income can adversely affect your business finances. There is a chance you will have to borrow money or close your business before you get going.
SMART IDEA: Be creative with your money and your time. Moms running home-based businesses know the importance of managing time and money. Be frugal when starting your business.
Personal Story: When I was 26 I liked to sew. I created stuffed toys for my 6-year-old daughter. I was borrowing a sewing machine and wanted one of my own. A friend of ours saw the patchwork teddy bear I created for my daughter and wanted 26 of them for nieces and nephews. I priced the fabric and materials and the new sewing machine into the cost of the 26 bears to come up with a final cost for the project. She happily paid the price. After 26 happy fun colored teddy bears, I had my sewing machine.
Step 4: Register Your Business Name
Your business name plays a role in almost every aspect of your business, so you want to put some thought into it. Make sure you think through all of the potential issues of the name you choose. Is another company already using that name? Is it too broad or too narrow?
Once you have chosen a name for your business, you will need to register it. Filing a trade name is easy. In most cases takes little to no time to file the paperwork.
SMART IDEA: Check your proposed business name with a domain registration service like Godaddy. Be sure to find a business name that gives you a.COM extension. It is still the most recognized domain extension and always carries more credibility than other extensions. Register your domain name if it's available. GoDaddy will give you other options to choose if your desired name is taken.
Step 5: Tax and Accounting
There are a variety of small business licenses and permits that may apply to the type of business you are starting. Each state has it's own laws and licensing requirements. Using a website like the Small Business Administration or Legal Zoom can assist with legal business questions. Make sure you check your state's licensing website for information on your states business requirements.
Choosing your legal business structure is an important business decision. Talk to your legal advisor or tax accountant for guidance on the proper structure for your business.
SMART IDEA: Make sure your business is viable and making money before creating a legal entity such as an LLC, S or C Corp. A 6-month wait period gives you a chance to see if your business idea will be successful. Once you see business success, contact your accountant or legal advisor for your next move.
Summing it up.
Making SMART choices in the first 6 months can lead you to business success. Stay focused and keep emotions out of your business startup. Avoiding some early pitfalls can lead to a happy thriving business rather than giving up and losing time and money and momentum.