Are you up for an out-of-the-box work experience where you can create and build opportunities instead of sitting and sulking at your desk all day?
Have you ever wondered how to get started with your own business?
Has it ever occurred to you that you can start your FIRE (Financial Independence, Retirement Early) plan as early as now?
Continue reading if you gave a resounding YES to the questions.
Reality check! One’s greatest asset is having a committed heart to help and create solutions for everyone. Being part of the solution and innovation is the key to a successful business.
Here’s a springboard on how to build a simple and well-grounded business plan. You will know where to get business ideas, what tools to use, what factors to consider when you’re a start-up business, how to connect to your customers, and how to grow and expand your business.
What is a Business Plan?
Before we get started, let me describe what a business plan is. A business plan is a document that defines your company’s strategy and goals, as well as how you intend to achieve them. It is a living and dynamic document because you need to review and update it regularly as your business grows and expands.
You must first plan everything out if you want to achieve financial freedom. Let me share my favorite passage from Dr. Stephen R. Covey’s book, “The Seven Habits of Highly Effective People,” which says to “begin with an end in mind.”
Are you ready? Let’s get right into it.
Step 1: Age of Exploration
Do your research. Living in a digital age means everything is just at the tip of your finger, so the best starting point is to know the market trend and identify the problem through rigorous research or you can simply do an observation. Knowing what is happening around you would help you ask the right questions.
- What does my community need nowadays? How do I fill in the gaps?
- What products/services are trending these days? What’s the reason behind such trend?
- What is the nature of my products/services? How can I provide these? Who will benefit from it?
- Who are my competitors? What are their strengths and weaknesses? What are the products/services that they do not yet provide?
The above-mentioned questions would anchor you to the kind of business that suits you. You can also conduct a SWOT analysis to help you analyze your gathered information.
Take note that when you do your research it is essential to get your information from reliable sources (e.g. Forbes, business insider, market watch).
Get business ideas. You can get business ideas in various ways. You can look into your business experience. It does not necessarily mean your own business. You can get ideas from your previous or current job. If you have a small business, you’ll get more perspective. Another way is to observe the business of other people.
You can also check some lists of businesses that start under $500, farming businesses, or Shirt businesses online to get some more angles.
Step 2: Business pathways
After researching the current business landscape, you must decide where to begin by considering where you fit in. In other words, you have to be aware of your position in the overall scheme. There are two options available to you.
1. Starting a business from scratch. Starting a company from scratch may be lucrative but also difficult. Consider the following probable benefits and drawbacks:
- The organization’s strategy and direction are entirely in your hands.
- You may cultivate a workplace atmosphere and culture that reflect your values and goals.
- You have the chance to create something original and creative.
- Starting a company from scratch can be labor-intensive, and you might have to juggle several tasks at first.
- Early on, you could only have a limited amount of funding and resources.
- Compared to purchasing an existing company, there is a greater chance of failure.
- Starting to make money and turn a profit could take longer.
2. Buy or Franchise a business
The world of entrepreneurship can be entered through franchising or purchasing an established company, but it’s crucial to thoroughly weigh the benefits and drawbacks of each option before deciding. Here are a few things to think about:
- You can start faster if you have an established consumer base and brand.
- The franchisee or business owner might offer you help and training.
- Compared to creating a company from scratch, there may be more cash and resources accessible to you.
- The business’s direction and strategy can be less in your hands.
- The franchisee or business owner may have set specific requirements and regulations for you to abide by.
- You might have to pay continuing charges or royalties.
- Your ability to operate and manage the business may be constrained.
Step 3: Overview of your business
When you have pondered on your answers for steps 1 and 2, it is now time to draft a summary/overview of your business. This may be a good time to do a bit of assessment wherein you would evaluate the scope and limitations of your business as well as your vision.
- Draft your long-term and short-term plan of action for your business. This includes your goals and strategies for handling your business during its profit and loss season.
To help you out in crafting your plan, you can make use of some business plan software tools. You might want to research and try it out before purchasing to find the one that best meets your needs.
- Products and Services. Identifying what you will bring into the market is essential at this stage. There are different types of products and services that you can offer.
- Physical products include actual items like apparel, gadgets, and furniture that can be purchased and sold.
- Software, e-books, and music are examples of digital products, which are intangible items that are distributed and accessed electronically.
- Intangible goods. Services include the performance of a task or activity, such as consulting, legal counsel, and hair styling.
- Services that are offered on a recurrent basis are referred to as subscription services. Examples include monthly magazine or streaming service subscriptions.
- Custom products. Products manufactured specifically for a customer’s wants or tastes, such as specialized furniture or apparel.
- Products supplied in bulk to other companies as opposed to single customers are known as wholesale goods.
- Retail products. These are offered to individual customers through a retail establishment or online marketplace, typically in smaller amounts.
- Knowing your current and possible resources is a must. Who will supply your products or deliver the services? How much are you willing to invest in your business venture? Will you have partners or investors? Where will you put up your business?
- Target Customers. You must identify the target audience of your products/services. Knowing more about your audience will motivate you to strategize your next steps.
Step 4: Evaluate your Finances and Funds
Financial planning. Exploring your resources will help you create a strong financial plan. It is also essential to use some tools to evaluate and monitor your projected cash flow such as google sheets, float, or QuickBooks.
There are different ways to get financial resources. Before you choose, you must first evaluate your current financial standing and projected cash flow.
- Bank loans: Banks and other financial organizations provide loans to companies of various sizes. The terms and specifications of these loans vary, but in general, enterprises must submit collateral and a thorough business plan to be considered.
- Venture capital firms make investments in companies they think have great growth potential. These companies frequently accept an ownership part in the company in return for finance.
- Crowdfunding: Crowdfunding systems let businesses raise money from a lot of people, typically online. Businesses launch a campaign with a financial objective, and people can donate money in return for benefits or prizes.
- Angel investors are those who put their money into companies in exchange for equity ownership. Angel investors have seasoned business owners or executives who may offer helpful mentoring and direction.
- Government grants: A few government organizations provide funding to businesses to encourage innovation, research & development, and other endeavors. These awards are frequently competitive, and businesses must fulfill certain requirements to be eligible.
- Personal savings: Many firms are financed with the founders’ or other shareholders’ resources. This can be an excellent choice for newly established companies that lack the track record or collateral necessary to obtain outside investment.
Step 5: Know the Legal Aspect
Business Ownership and Contracts.
When starting a business, you must decide the type of business ownership that you will get into before you register it. Do you prefer a corporation, partnership, or sole proprietorship?
It is always prudent to document everything, especially the agreements and the people involved. And so, after choosing the type of ownership, look into the types of business contracts and consult your lawyer about it.
Opening a bank account. One of the most crucial parts of putting up a business is creating a business bank account. Choose a reliable bank where you can store all your income. You must separate your savings and business account so that when the IRS will conduct a surprise audit everything will go smoothly.
Business Tax. You must also look into the taxes involved as you run your business. To make it easier for you to track and file your taxes, here are the best overall-tax software that you can use:
- For individuals, self-employed people, and small business owners, TurboTax is a comprehensive tax preparation program. There are several features and support choices available, including live tax assistance from licensed experts.
- H&R Block: Individuals, self-employed people, and small business owners can all use this tax preparation program. Several options are available, including the capacity to import your W-2 and 1099 papers as well as real-time tax advice from professionals.
- TaxAct: Individuals, self-employed people, and small business owners can all use this tax preparation program. Several options are available, including the capacity to import your W-2 and 1099 papers as well as real-time tax advice from professionals.
Step 6: Build your Workforce
- Take on your first employee. You can find people for your business through word-of-mouth or online like Facebook or Instagram. If they don’t meet your standards, you can also check an online job board such as Found it or Simply hired.
- Contract with an Accountant or Bookkeeper. If you are still starting your business as a sideline, you can record your income and expenses using float or quick books.
On the other hand, if you’re already a big business with a lot of products and branches, consider hiring a bookkeeper or accountant. Most start-up businesses would only need a bookkeeper, but if you need intricate financial statements and advice, do hire a Certified Public Accountant (CPA).
- Consult Business Attorneys. Since every business has legal implications, you might want to ask for legal advice from your lawyer to avoid penalties and violations.
- Have a Business Adviser. Seeking guidance from experts in the field would help your business survive and thrive in the business world. You can find no-cost advisers who volunteered to help new businesses such as SCORE and SBDC.
Step 7: Identify your Technical support
Depending on the size and type of business, a variety of systems and software can be helpful. Here are a few illustrations:
- CRM software: This assists companies in managing customer interactions and data over the course of the customer lifecycle.
- Accounting software: This aids companies in keeping track of all of their financial activities, such as payroll, spending, and invoicing.
- Software for project management assists companies in the planning, monitoring, and collaboration of projects.
- Office suite: For most firms, having a set of productivity tools including word processing, spreadsheet, and presentation software can be crucial.
- E-commerce platform: An e-commerce platform can assist a company that sells goods online in managing their online shop, processing orders, and managing financial transactions.
- Tools for communication and teamwork: Organizations may require email, messaging, and video conferencing software to promote communication and teamwork among team members.
Step 8: Social Engagement
Now, it is time to spread the word about your business to the public. One of the effective ways to grow your business is through building warm personal ties with your target customer. Here are the 2 pathways that you can take:
- Traditional pathway. This is when you promote and sell your products or services in a conventional way such as through newspaper ads, billboards, radio stations, and leaflets. The main principle of this pathway focuses on retention through repetition. Meaning, the more they hear, see and touch the ads the higher the probability that they’d remember them.
- Digital pathway. It is when you buy and sell your products and services online. This pathway makes use of various online platforms to introduce its brand. Some would make use of emails (e.g. Aweber, Leadpages) to connect to their clients in a personalized/customized manner.
- Be well-acquainted with your brand. This is important because once you establish your business identity it will be easier for you to be recognized in the market.
Your brand speaks about your target audience/clients. Thus, you can make use of some online platforms such as business tools to help you stand out in this crowded field and find your clients easily.
Whatever pathway you would choose, use some social strategies to compel them to come back for more.
Step 9: Evaluate and Improve
The last step is you have to review everything and identify the perks and pitfalls of each step. It is also helpful to listen to the feedback and comments of your customers so that you know how to improve your business.
It’s also crucial to look forward while looking back. Having insight about the future, based on past undertakings, could greatly help you come up with a good fallback or strategy to manage the risks.
Frankly, business is all about risks, and what separates you from failure is your ability to handle the risks.
Points to ponder
Looking into the steps above, financial freedom is not really about being able to do whatever you want with your money. It’s a blessing that gives you more time to utilize your resources effectively and the ability to provide opportunities for others to grow and expand.
I remembered this quote from the movie Spiderman: “With great power comes great responsibility”.
So, make use of your financial freedom and plan your business wisely! One step at a time.
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