Starting a new business is straightforward. What’s more difficult is keeping that business afloat in the medium term, and finding opportunities for growth in the long term. Data from the Bureau of Labor reveals that around a fifth of new businesses fail within the first year – a figure that, after ten years, rises to around 70%.
Often, the difference between failure, survival, and prosperity rests on the foundations you lay during the first few weeks and months. Let’s take a look at the questions we might consider when first forming the plan for a particular business.
First steps
The overwhelming majority of successful businesses start with well-formed business plans. The business plan doesn’t have to be a lengthy document. But it should, ideally, contain a few important points.
You should set out what you’re looking to achieve and how you’re going to achieve it. You should identify the obstacles that you anticipate, and how you think you’ll overcome those obstacles.
What really matters is that you’ve spotted a gap in the market, and that you believe you are well-positioned to fill it. This might mean reflecting on your own interests, and your personality as an entrepreneur. If you’re investing in a subject that you’re passionate about, then you’ll be at a natural advantage.
Sourcing the right materials will be of particular importance to new manufacturers. If you’re going to be building electronic equipment, for example, then you’ll want to be able to deal with a reliable supplier of power products.
Legal process
In the US, registering a business is what makes it a legal ‘entity’. However, not all businesses will need to be registered. You might be a self-employed person who freelances using their own legal name. However, there are certain legal and tax benefits – like liability protection, which make registration worthwhile.
In many cases, registration is as simple as letting your local government know what your business is called, and where it is. If your business is a limited-liability corporation, then registering is more likely to be required.
Once you’ve undergone the registration process, keep any relevant paperwork on hand. If you have an office, or even a set of drawers, then setting aside the space might save you considerable stress later on.
Consult with experts
The US is home to thousands upon thousands of small business owners, many of whom have encountered the same common pitfalls and hazards. If there are successful businesses in your area, then you might offer to do something for them in exchange for mentorship or informal advice. Networking is a skill in its own right, and one you’ll need to develop. The rewards are often worthwhile, as the right guidance can often make all the difference.