The first stage of starting a small business is thinking about it. But, that alone can seem
daunting, if you can't break down the endeavor into smaller, manageable steps, which
you can then think about one-at-a-time. The following is a simple outline or template
representing all of the steps that generally occur in the initial evaluation of an idea for a
small business.
Choosing a Business Idea
Follow your passions to find a business sector. Determine what area within that
business sector best suits your abilities and personality. Assess if you can raise enough
money to enter that area of business.
Can Your Idea Be a Business?
If you are thinking about starting a completely new type of business, begin by
researching how your idea could be turned into a business, whether it would be legal,
how much of a market would there be for your product or service, etc.
Part-time or full-time?
Are you ready to start a full time business, or do you want to keep working and run
your business on the side?
Home business or office business?
Can this business be run from your home (and do you want to work from home), or
does it need to be in its own office or building?
Owner operated, or a business with employees?
Can you run this business alone or will you need employees? If you will need
employees, estimate how many would be needed to start the business.
Choose a business structure
You can now incorporate a new business online, or form an LLC, partnership, sole
proprietorship, etc. Decide what would be appropriate for your new business.
Write a business plan
Writing a business plan serves many purposes: it creates a detailed description of the
entire business, which will force you to think through all aspects of how the business
will work; it becomes a presentation document that you can use to apply for business
loans or to interest venture capital firms; it becomes an incentive to attract qualified
people to join your business as officers or board members; and, it works as a blueprint
to be built on as your business grows and expands.
Decide how you will finance your business
Personal credit, business loans from a bank or credit union, venture capital investment,
private loans from friends or family, etc.
It is important to note that this process - the assessment of a new business idea - can
be done over and over for little or no money. And each time you go through the process
of assessing another idea for starting a small business, you will become more
knowledgeable about the process, about business, and about what type of business will
work for you.
