10 Steps To Begin Your Own Business

Small business owners control, manage and operate a company or organization. They can work in a variety of industries and provide goods or services for local and global customers. Learning more about this career path, including the potential advantages and traits for success, could help you determine whether this is the right opportunity for you. In this article, we provide the potential benefits of owning a small business, traits that could help you succeed and the steps you can take to become a small business owner.

Benefits of being a small business owner

There are many reasons professionals decide to start their own business. Potential benefits of becoming a small business owner can include:

• More independent decisions: Small business owners make many important financial, business and marketing decisions. They often have more power and control over these decisions when owning their own business.

• Increased flexibility: Depending on their industry, business owners may be able to set their own hours and schedules.

• Unique company culture opportunities: Small business owners can design their own workplace culture and environment. This can include planning work events, designing the building layout and planning employee benefits.

• More chances to meet new people: Networking is an important part of building a business, and small business owners may get the chance to connect with local professionals, investors and clients each day depending on their industry.

• Increased financial potential: Professionals may start their own businesses to increase their earning potential.

• New challenges: Owning a business can be an exciting challenge with lots of opportunities to grow.

• More remote opportunities: Depending on the industry, some small business owners can work from home or remote locations. They may establish remote options for the company or choose to complete their work from home on certain days.

• More control when building a team: Small business owners can recruit and train professionals to design a strong business team.

Traits of successful small business owners

Successful small business owners use a variety of hard and soft skills to help them grown their companies. They may have the following traits:

• Self-motivated: Small business owners need to self-manage their daily tasks and responsibilities. Self-motivation or the ability to complete tasks independently can help business owners complete tasks and reach their goals.

• Determined: Starting or operating a business can take determination and perseverance. Determination can help small business owners succeed and overcome challenges.

• Confident: Small business owners may present information to clients or investors, recruit team members and market their services. Confidence can help business owners present information effectively.

• Creative: Whether small business owners manage an existing business or start their own, they can use creative thinking and innovation to launch new products, methods and ideas.

• Adaptable: As the market changes, successful business owners adapt and adjust their business plans and marketing strategies. Developing a flexible attitude or adaptable mindset could help business owners succeed.

• Persuasive: A small business owner may need to recruit others to join their team or invest in their business. Strong persuasive skills can help them promote their company and explain their services.

• Leadership skills: Small business owners oversee a team of professionals. Strong leadership skills such as delegation, motivation and communication, can help them effectively lead their teams.

• Negotiation skills: Business owners may negotiate prices, contracts or services with a variety of audiences including investors, clients and employees.

How to become a small business owner

There are many ways to become a small business owner. Your career path can depend upon your industry, level of experience and skills. If you are interested in becoming a small business owner, consider following these general steps and adjusting as necessary:

1. Brainstorm and reflect

Take time to think about why you want to become a business owner and what type of business you hope to operate. Brainstorm your general goals by thinking about your desired outcomes. Consider your interests, hobbies and skills when brainstorming business ideas. Considering your passions, expertise and goals could help you choose a business idea that works well for you.

Read more: Top 50 Small Business Ideas for You

2. Choose a career path and industry

Next, you can explore possible career paths and industries. There are three main ways small business owners begin their companies:

• Gaining ownership over an existing business: Some small business owners purchase or inherit an existing company. For example, they may inherit a local retail store from a family member.

• Starting a franchise: A franchise is a business that is owned by an individual but part of a larger brand. For example, a national restaurant may have franchise locations. A small business owner may choose to purchase a franchise location in their neighborhood.

• Launching a new company: Many small business owners begin their own company in their local area. For example, a business owner could create a new hardware store in their city.

After choosing a career path, think about the industries you are most interested in. For example, if you like making food, you may be interested in owning a restaurant or food truck. Choosing an industry you're passionate about could help your business succeed.

3. Conduct research

After choosing your industry, research the existing market to learn more about business strategies and ideas. Try to notice any market gaps or needs in your local area. This can help you create a new business idea that will attract customers. For example, if people in your community travel a long distance to get to the one grocery store in your town, another grocery store on the other side might address a gap in the local market.

4. Draft a business plan

A business plan is an important document that details a company's goals and strategies. This document can vary depending on the industry and business, but most plans include a combination of the following information:

• Summary

• Description of the business

• Information about the products and services the company will sell

• Market analysis and comparisons

• List of company goals and specific performance milestones

• Organization and management details

• Marketing plan and strategies

• Financial plan

• Funding information

This important document can serve as a guide for managers or business owners. If you are starting a new small business, it can also help potential investors learn more about the business when making investing decisions.

Read more: What Is a Business Plan?

5. Explore funding options

If you are starting a new business or purchasing a franchise or existing small business, you may need to secure funds. First, calculate how much you will need to purchase a business or launch a new company. Then you can explore your funding options. These may vary depending on your location and type of business, but some possible funding options include:

• Providing your own funds from savings or other investments

• Applying for a business loan

• Seeking funds from investors

6. Choose a business structure

A business structure is the legal structure of an organization. This defines who owns the company and how it distributes profits. A business structure can affect taxes, paperwork, liability and funding options. The five common types of business structures are:

• Sole proprietorship: This is when one person owns and operates the company.

• Partnership: A partnership is when two or more people own a company together.

• Corporation: This is typical for large companies where the business is separate from the owners, but it can apply to small businesses in certain situations.

• S corporation: An S corporation may be more common for small businesses than a general corporation. This structure limits liability and considers the business as a separate entity with some size restrictions.

• Limited liability company (LLC): This is a hybrid structure where the business owner has some liability and protection.

Read more: The 5 Common Types of Business Structures

7. Select a business location and name

The next step is choosing a business location and company name. If you are purchasing an existing company, it may already have a name and location. You can keep the existing information or you might choose to change the name and location.

To choose a name, take time to brainstorm and get creative. Try to pick a unique name that reflects your desired brand or company message. Consider reviewing names with network connections, family members and friends. Someone you know may provide specific feedback or suggest a great name.

When choosing the location, consider whether you want to open a storefront, office or operate an online business. Consider your budget, local regulations and desired audience when choosing a location.

8. Register your business and apply for licensing

Once you choose a name and structure, you will need to register your business and apply for licensing as necessary. States can set their own guidelines around business registrations, so be sure to check with your location when completing this step. Certain industries may require a specific license, so consider researching the requirements for your type of business.

9. Hire team members

Some business owners work independently when launching a new business, but you may need to hire a few employees before you can begin operations. If you decide to hire new team members, consider creating a job listing and recruiting professionals in your area or remote locations. As a business owner, you might be in charge of the hiring process, including interviewing and onboarding. Consider taking time to think about what skills and qualifications you are looking for in team members.

Read more: How to List Job Responsibilities in Job Listings

10. Market your services

Before opening your business doors, you may choose to market your products. You can use the marketing strategy you created in your business plan and revise as necessary. Depending on your business type and industry, you may advertise online, in local newspapers or through the mail. Some business owners choose to create a special event or discount for the grand opening. Consider who your target audience and how you might reach them when designing a marketing campaign.