Starting a new business can be a good thing. But before you dip yourself entirely into the venture, it is good to understand what it entails in order to have a successful start-up. If you need your startup to succeed, you need to have a concrete plan for the business from the word go. Here are some of the basics you need to know before you venture into your startup business.
A business plan is the most basic thing in any startup. This is a written document that will describe your business’ objectives, goals, strategies, financial plans and target market. It assists one set timely and realistic goals as well as get funding for the business. A business plan also helps one be able to measure success, get clarity on operational requirements and set the tone for the business operation.
If one needs external funding, the amount of funding they will be advanced is dependent on the business plan. In order for any financial institution to advance loans for your startup, you must show the ability of your business to generate income.
A business plan is not just a paper about your business heart upon which the success of your start-up rests. It helps you set the stage for the business. Proper planning is the path to success.
You need to understand the sources of financing your startup. Is it private finance or will you seek outside funding? Bearing this in mind, one is ready to secure the finances. If you’re starting your business in Canada, there are many government initiatives aimed at financing startups. You can also finance your startups through your close associates and family members. Whichever source of funding you decide to choose, you need to determine on how you are going to pay back the loan.
When starting a new business, there are three kinds of business structures to choose from. These include sole proprietorship, incorporation and general partnership. It is prudent to choose a business structure which suits you best. If you would like to go solo, sole proprietorship is the most suitable, but should you like to share profits, losses and risks with another party then general partnership can work wonders for you. For those who want their business to be a separate entity from them, then incorporation is necessary.
Choice of Business Name
It’s important to pick the name by which your business will be referred. The right business name can be an effective marketing tool on its own. To avoid ambiguity, your business should not share a name with another business. There are many approaches to determine whether the chosen name of your business is already taken. You can use websites such as business name search Canada to determine whether the name is currently being used.
Choice of Business Location
Location of business is a big determinant of the business’s success. Location determines the market strength, requirements for licenses and permits, applicable taxes, business laws, level of competition and availability of materials to be used in your business.