Starting a business is incredibly exciting, but it also requires a lot of strategic planning if you want to create something going to last for years. Follow our top five checklist for precisely what new business owners need to know, and you can look forward to creating your own success.
Five tips to know when starting a business:
Plan, plan, plan
When you first decide you’re starting a business, it can be tempting to go in there firing on all cylinders. But before you go ahead and buy that domain or start planning your website, the very first thing you need is a solid business plan. This can help you figure out who your ideal customer avatar is as well as your main competitors, the costs you’ll need to cover and the opportunities the market offers.
If you’re looking to fund some of your initial business expenses through a bank loan or investors, then without a business plan, you won’t get past the door. There are many resources out there for creating a business plan, but flexibility is key in the current market.
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Writing your first business plan might feel like a daunting task, so here are some pointers to keep in mind as you get started:
- Remember your audience
- Do your market research
- Identify your competitors
- Include your unique selling proposition (USP)
- Know your numbers
- Write an executive summary
Your plan should help you set goals and outline the steps you’ll need to take to get there. Then, once your business plan is drafted up, you can move onto the next stage: getting ready to launch!
Open a business bank account
Don’t make the mistake of using your personal account for business purposes. If you’re setting up as an LLC or s-corp, then this is vital. Starting on the right foot when it comes to your business banking will make filing taxes and keeping a general eye on your monthly profit and loss much easier. In addition, you may decide to apply for a business credit card for larger purchases relating to your business.
Your bank may even offer a business loan if you can show them evidence of your cash flow and collateral. If you can show this as well as a realistic, written business plan, then your bank is far more likely to offer you a loan.
At the same time as setting up your business bank account and looking into financing from your bank, you might want to consider other financing options, including grants, equity financing, angel investors or venture capital investment.
Sign up for accounting software
Spending money on accounting software might seem counterintuitive if you’re trying to keep your expenses lean, but when it comes to tax season, you’ll be wishing you had! At first glance, you might think it would be cheaper to handle all of your accounts payable in-house, but there’s plenty of hidden costs when it comes to invoicing. Choosing to use AI-based accounting software can help your invoices be approved much faster and save you money and time.
You can still see every stage of invoice approval, but you don’t need to worry about managing it all yourself. You can also often generate financial reports for key insights like profit and loss and cash flow, and it makes tax filing season more streamlined. Using accounting software also makes it much easier to identify potential fraudulent transactions, as the software will flag these for you. With fraud affecting small businesses twice as often as large businesses, using accounting software from the outset is a smart decision for any new business owner.
All this frees up your employees to spend more time starting a business successfully instead of tracking down invoices before they’re verified and approved, generating reports and preparing tax returns.
Choose your content management system carefully
Before you rush in and sign up to a web host or content management system (CMS) without figuring out precisely what they provide, take a moment to think about what kind of flexibility you’re going to need in the future. Many customers now consume content on a whole range of different devices, from their mobiles to voice-activated speakers and smartwatches. If they can’t access your content on those devices, you might lose business to a competitor with more flexibility. While the most popular options in the past generally offered an all-in-one or a monolithic CMS, these days, many businesses are choosing the more flexible option of the micro-services offered by a headless CMS.
Choosing a CMS that uses a decoupled or headless architecture can help you meet your customers’ needs much better. These use micro-services to communicate your content through a wide range of application program interfaces (API) without you having to duplicate content.
Having a strong presence on the web is vital for all types of businesses. Making sure to choose the right CMS can make the difference between easy updates and a constant battle to stay on top of all your content. It’s much faster and easier to distribute your content across any and all channels using a headless CMS, meaning you can make sure you keep providing an amazing user experience, no matter what device your customers are using.
Be smart about your taxes
The way your business is set up will dictate how you prepare and file your taxes. Unless you’re confident filing your business taxes yourself, it can be worth working with a bookkeeper or accountant. They’ll know exactly what you need to do to meet your tax requirements. They can also help you figure out any deductibles like office expenses, travel and even subscription fees.
Start the habit of keeping all receipts that you can claim as business expenses. It’s a good idea to write a brief note of what each receipt relates to, and if it’s a business lunch, pop the name of who you met and what the purpose of the meeting was. When it comes to making deductions, a system like this will make things much easier! While you don’t have to keep receipts for all expenses, it’s a good idea to get into the habit of saving them all.
Some automobile expenses can also be deducted, and you can usually choose to either deduct actual expenses or a standard rate for mileage. Depending on how you run your business, these can offer different levels of savings. It’s a good idea to talk to your bookkeeper about estimating the savings offered for both options before you choose which one to use.
Starting a business doesn’t have to be as stressful as it may seem. Once you’ve ticked off everything on this list, you’ll be one step closer to starting a business!
Originally published Sept. 14, 2021.