Tips for Starting a Small Business

By Cheryl Gorski

  • Overview

    Entrepreneurship is the epitome of the American dream for many of us. You want to make the leap but have no idea where to get started. Below you will find a few helpful tips that can get you on your way to opening and managing your own successful small business.

  • Have a Solid Plan Before You Open for Business

    • Step 1

      Decide on a business. If you would like to be an entrepreneur but don't have an idea what business you would like to start, research franchise opportunities, business ideas and home-based business versus "brick and mortar." If you will be working on a very shoestring budget, you may want to consider starting with a smaller home-based business. Narrow down your interests and select a service or product you have at least some knowledge about.

    • Step 2

      Find financing. If you are starting a home-based online business, your overhead will be much lower, but you will still incur possible costs for equipment, web design, inventory (if you are selling) and other expenses. If you do not have the personal resources to fund your business you can consider loans from family or friends, bank loans or funding from other investors.

    • Step 3

      Determine your business structure and get appropriate licenses or permits. Will your business be an LLC, Corporation or Sole Proprietorship? Find out what business permits or licenses you may need, as well as get proper insurance to cover your business.

    • Step 4

      Have a plan for bookkeeping. Keeping strict financial records is essential for determining revenue, managing expenses and, of course, paying taxes. Determine how you will proceed with bookkeeping procedures, whether you pay someone to manage accounting for your business or utilize a computer software program, such as Quicken.

    • Step 5

      Write a business plan. Books and online resources can offer suggestions on how to do this if you are uncertain where to begin. Your business plan will outline your needs for funding, discuss your business idea in detail and also include your marketing plan, which is critical in advertising your goods or services. Your business plan is a strategic plan for your success.
    • Skill: Moderately Challenging
    • Ingredients:
    • Business idea
    • Business plan
    • Financing
    • Business phone number
    • Tip: Take a course in entrepreneurship or starting a new business at your local community college.
    • Tip: Visit the U.S. Small Business Administration's website for helpful information on getting started.
    • Tip: Research your competitors to see what others are doing and how they are marketing their products or services.
    • Tip: Consider upgrading your computer technology if you are working with older and outdated hardware and software.
    • Warning:
    • Don't underestimate your start-up costs.
    • If you are selling a product online, research to see if your product is in a "saturated" market.
    • If family or friends are loaning money to help you start your venture, they may want to have more of a stake in the business.
    • Don't ignore bookkeeping--keep strict records.

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