How to Start a Business: Tips to Start a Successful Business
Many people take a leap of faith every year in their career choices. They leave their nine-to-five jobs and begin their own business or company. While many aspire to be entrepreneurs, a few know the hurdles to starting a successful business. Many requirements and steps must be followed to ensure a business starts and grows successfully. After reading numerous papers, I finally took the dip to discover how to start my own business.
1. Have a Great Business Idea
Your first and foremost task is to have a good business idea. Take time to determine what you want and whether you can make it work. In forming your idea, make sure that you solve a problem every day, have a skill that you can easily do or already know well, and that people are willing to pay for it. You can also focus on launching another successful brand as a franchise. Franchising benefits because people already know and trust the brand, so you could start generating income from day one. It is much easier. An example is starting your own branch with the fast-food Kentucky Fried Chicken (KFC). People already trust the brand’s name and will enter any branch around the corner. You can draw up a business plan if you have decided on the business idea you want to start up.
2. Have a Business Plan
Next is to draw up a business plan. Your business plan will help you determine which key problem your company will be solving, how it will add value for your target customer, how you plan to achieve short-term revenues and profitability, how you plan to reach market penetration & growth, how you are raising startup capital, and more. You will be focused on the goal and guided by an integrated business plan to achieve what your business has planned for. Imagine a soccer team going into an unplanned game. Imagine an army marching without planning against an enemy. Then imagine a company without a plan. It is certainly going to fail. It may not be the last plan your enterprise will be working within the long run, but it’s necessary to create one before you start your business.
You will have to show banks and investors why they should invest in your business when you are looking for financing. Lenders and investors only risk their time and money when they trust your company is successful and profitable. A comprehensive, thoughtful business plan is one of the most valuable tools to help you achieve your long-term objectives. It provides a direction for your business, defines your targets, identifies strategies to achieve your objectives, and helps you manage potential bumps. Preparing a business plan helps you to identify the goals and strategies you want to achieve. So instead of spreading yourself too thin, you can focus your resources and energy on what you need to do. The planning process also helps you consider possible bumps and establish a plan to manage them better when they arise.
Developing your business plan helps you step back and see what works and can be improved on in your business. If you have employees, the planning process can allow you to get feedback on ideas and improvements. Your staff will appreciate this opportunity to participate. Business planning can appear to be overwhelming and long-term. However, many successful companies see this as a chance. Planning lets you learn about the various forces and factors influencing your success. It helps you step back and look at what works and what you can enhance if you are already in business. An enterprise plan helps to give you a sense of control over your business and livelihood rather than worry about the future.
3. Choose a Location
After producing a comprehensive and highly intuitive business plan, you must determine where your business is situated. Ideally, Your company must be close to your target customers and not your competition. The customer demographic and everything must be considered when locating your business office. Your location must be around the people most likely to pay for your products or services.
Ultimately, the location you choose to situate your business could determine if your business will do well or not. Ensure you find out if most of the area’s human traffic falls within your targeted consumer base. You can use location analysis tools such as Google Analytics to provide information such as traffic patterns and lifestyle data from those who come and go in the area for a fee. Such demographics include age, occupation, and income from households. You will be able to know how well your product will sell in that vicinity by figuring out the nearby demographics. Alternatively, by looking at where your competitors are, you can save on the cost of location analysis. Due to human traffic, fast food chains usually locate their businesses next to each other. Seeing the location of your competitors gives you a good gauge of the feasibility of doing business in the area. It’s up to you to design your business model to attract more customers.
4. Startup Capital and Legal Structure
You need a clearly defined way of running your everyday business financially, acquiring products, promoting your brand, etc., before you start your business. This requires capital to carry out. There are several ways for your business to raise startup capital, ranging from angel investors, personal finance, friends & family, and many more. When you have a clear way of raising and acquiring a part of your corporate start-up capital, you can move on to determining the legal structure to be established. However, you need to know the different types and how they could fit you before deciding which legal structure to create. If you are mostly the only person in the company, you should follow a sole proprietorship model. You can register a partnership if you have more than one partner in the company. This means both partners are liable to the company. You must set up a corporation to separate your personal and firm liabilities.
Before you register your business with the relevant governing bodies, it is important to understand the legal structure you want to form around your company. It should also be noted that most SMEs are in bankruptcy, so it is not necessary that you should start your own business. However, it is always a good idea to have measures to protect your new business against bankruptcy, which seems to plague small businesses today. If you’re not confident about this, you can recruit legal aid to help you.
5. Register Your Business with the Government
The next step is to register your business with the appropriate governmental agency. You would need to receive an article of association if you are registering a company. Usually, this includes plenty of business information. You must use a lawyer for everything when registering a limited liability company. You can simply register the company as a business if you don’t want to register a company. In a country like Nigeria, you don’t have to have a lawyer to register a business name. The laws are different in other parts of the world. After your company or business registration, you should register with the Federal and State Tax Offices. When you register with the Federal Inland Revenue Service (FIRS), your tax identification number will be provided, which you will use for many other purposes, such as opening a bank account for your business and more.
The Bottom Line
In conclusion, there are a lot of misconceptions out there about the friendliness of Nigeria to start-ups and generally small enterprise businesses. Most people think the government does not have policies to support these types of businesses. Still, the federal government of Nigeria has made strides in making Nigeria a friendly environment for entrepreneurs. Once you are armed with your business ideas and follow the key processes I have listed above, rest assured that you are on the right path to successfully getting your business off the ground. However, I must add that following these key processes does not guarantee business success.
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