Starting a new company could be an enticing undertaking. However, before you plunge yourself entirely into the venture, you need to understand on how the business will be run in order to be profitable. 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’ aspirations, goals, strategies, financial needs and market availability. 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 also establish the tone for the business success.
If needs external financing, the quantity of loan they will be given is highly determined by the strength of their business plan. In order for any financial institution to extend their credit to you for your start-up, you must demonstrate the ability of your business to make profit for an extended period of time.
A business plan is not just a paper that stipulates what you intend to do in the business but it is the gist of your whole operation. It helps you set the right direction for your business. With proper planning your business is set for success.
You need to understand the sources of financing your startup. Is it personal finance or are you going to seek outside financing? With this in mind, one is prepared to determine on how to secure the financing. In Canada, there is lots of government programs geared towards funding business 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 business, one is faced with about three types of business structures to choose from. These include sole proprietorship, incorporation and general partnership. It’s wise to decide on a company structure which is most appropriate for you. 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 people who want their business to operate as a separate entity from them, then incorporation is vital.
Choose a Business Name
It is important to decide the name by which your business will be called. A good name can be a good form of marketing. To prevent ambiguity, your business shouldn’t 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 sites like business name research Canada to ascertain whether the title is already being used.
Choice of Business Location
The place where your business will be established is an important determinant of your business’s success rate. 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.