“Ideas do not come out formed”, says Mark Zuckerberg, the billionaire founder and the CEO of Facebook.
An entrepreneur needs a basic draft of an idea to get things rolling. Market research will help gain a better understanding of how your products and services can be beneficial to your customers.
Everything else that follows – legal, financial, marketing, and logistics – are a much later thought.
About 90% of start-ups fail and is most common within the first 2 to 5 years of being in business.
Wondering what makes the remaining 10% achieve success?
Is it the viability of an idea? Is it the proper management or marketing? Or is it just sheer luck?
A holistic business plan will unlikely fail, and even if it does, you will be able to pinpoint what went wrong. A business plan is used as your guide to ensure that you have a solid plan as well as gain funding for your business. Investors are less likely to invest in businesses that have a lot of risk and are more likely to default on their loan.
Before we venture into the essentials of entrepreneurship, let us differentiate between a small business and an entrepreneurial venture. Entrepreneurship and running a traditional business are different and polar opposites of each other. A small business is defined as a company, partnership or sole proprietorship that has a small number of resources and annual revenue than a medium or large company.
Entrepreneurship’s fundamental difference lies in its ability to offer something novel and an idea that is seen for the first time. Although entrepreneurship is fundamentally different, it requires largely the same steps that are followed in traditional businesses’ establishment.
Let us walk you through the “8 Factors of Highly Successful Businesses” to help you understand what steps are involved in setting up a successful business.
Registering Your Entrepreneurial Venture
When starting up a business, it is important to register your venture. Explore your options of starting out as either an LLC, Sole Proprietor, S corporation or a C corporation.
By registering your business, your company will get a life of its own and will be liable for debts, legal complications, and other claims against it. As an individual, you will not have to make yourself vulnerable to legal and economic lawsuits.
It is essential to apply for your free Employer Identification Number (EIN) and register as a taxpayer. Think of EIN as a social security number, but for your business venture. To apply, it only takes approximately 15 minutes to complete the application online located on the IRS.gov website.
Business Bank Account
A business bank account will not only make it easier for you to manage and grow your business but also signal your customers as well as clients that you really are in business. So, don’t forget to open one.
A Bookkeeping Software
A well-kept accounting system reflects well on the business. Not only does it rid you of the tax complications, but it also makes it easier for investors to determine the expected cash flows and return on investments.
There are countless software applications that can help you track your finances, such as, Wave,
Protecting Your Intellectual Property
An idea can be worth a million dollars. It is therefore natural to protect our ideas legally. Following are a few intellectual property protections, one must familiarize oneself with:
- Patents that allow your novel idea to not be used in any form by another party
- Copyrights recognize original ownership of a particular idea or work and grants the owner the right to distribute its copies and make profits
- Trademarks give ownership over name, logo, symbols, or any piece of work that can be used to identify your business and has become a distinct marker of your business.
- Non-Disclosure Agreements that protects your sensitive information from being released publicly by the third party
Although permissions, grants, and licenses vary from one business to the next, every business needs a few key licenses before operating in the market. Here’s some of them:
- A permit if you are running a regulated business
- Sales tax license
- A seller’s permit
- Health department permit if you are in the food or beverage industry
Having invested your time, money, and resources, you must make sure that you do what you can to protect all of it by investing in an insurance coverage plan.
Explore what risk is your business most susceptible to? What will be needed to be covered?
What is the minimum and maximum coverage you need and might require in case of an emergency?
Having explored your needs, you then need to search for the most holistic, yet cost-effective insurance plans while considering the deductibles, how high is the coverage limit, and what are things covered and not covered by your chosen insurance plan.
Build A Marketing Plan
You can have the best product or service but your business will not grow unless your target audience knows about it. This is where marketing comes in.
There are three things you need to do.
First and foremost, you need to set up a stunning, responsive, and user-friendly website. Note that your website is your online identity and crucial for your success. So, leave no stone unturned in ensuring that it’s exceptional.
Then comes leveraging digital marketing. This is extremely important because in this technologically advanced era, going digital is the key. From embracing social media marketing and search engine optimization to email marketing and Pay-Per-Click advertising, you need to focus on them all to achieve a competitive advantage.
Last but not the least, you need to up your game when it comes to utilizing traditional marketing tools such as flyers. They can help engage, inform, and educate the ‘right’ audience, promoting your brand and getting you high-quality leads.
Note that all your marketing needs to focus on highlighting the value you will create in your customers’ lives rather than pushing your product or service at them. Offering value to your customers will lead to profits.
Entrepreneurial ventures are filled with fast-paced developments and excitement.
However, there are times when processes get bureaucratic and slow.
Despite the snail pace, it is important to keep a positive outlook, continue hustling, and allow such processes to teach you a thing or two about market dynamics and how the market rewards those who are patient.