In case you have already made a decision to start your own business, you will need to brainstorm and get prepared for some difficult decisions that can make or break your success. From legal form to employees and financial management; there are several important decisions you are expected to make to the best of your abilities. Below you will find seven of them, to help you get ready for the challenging times.
1. Business Name
The first and most important decision you will have to make is choosing your business name. It needs to be unique and have a positive value to your target market. You will also have to choose your business name based on your profile, so your potential customers can quickly identify your industry. It is important that you check your proposed business name and make sure it is not used by other companies. After you have ensured that you have a unique name, it needs to be registered and protected, so other people cannot piggyback on your brand reputation later.
You might want to set up your business at home or rent an office. Either way, your location will have an impact on your future success. When you have a shop, make sure that there is enough foot traffic and parking in the area. If you want to have an office, you will need to consider the needs of your customers visiting you, as well as your employees. Stay in a preferred location, but close to public transport links and highways.
3. Legal Entity
Before you can incorporate, you will need to choose your legal business entity. There are different benefits of founding an LLC or a Corporation. Depending on your size, business profile, and operating area, you can select a business structure that serves your needs the best. Consult with a business advisor if you are unsure, and make sure that you implement a Symafct entity management software that takes care of your corporate governance tasks and obligations.
4. Taxation Method
Once you have incorporated, you will have to choose the taxation method that suits your business needs and financial profile. You might want to get in touch with a CPA advisor, to avoid paying too much, and getting yourself registered for taxation at every state and federal office, to avoid penalties. Based on your area of operation and industry, you might have to sign up to more than one type of tax.
If you don’t have the right staff for the job, you will end up disappointing your customers. Look for employees whose skill set matches your needs, and those who have a proven track record. If you are doing something different, you might want to train your own employees, or hire apprentices, so they get used to your innovative working methods. Either way, pay attention to employee selection and set clear criteria, so you can get the best value for your money.
6. Payment Terms
Every business is set up to make money. As a startup business, you might offer better terms to your customers than other firms, but this doesn’t mean that you should endanger your financial stability and liquidity. Offer payment terms on invoices that are flexible and reasonable, and allow you to meet your own financial commitments. Don’t be shy to ask for deposits from clients if you need to invest a large proportion of the price in stock or raw materials. You might want to set up your own accounting software on the Cloud that sends invoices, reminders, and letters automatically.
7. Financing Methods
To maintain your financial stability, and improve your future outlook, you will need to strike a deal for financing your projects. In the beginning, you might get a startup loan, but this will not last long. It might be several months until your business starts making profits, and you will need to pay your bills meanwhile. Creating a detailed financial plan that lists all the regular and variable outgoings will help you manage your money better. Whether you want to secure a line of credit with your business bank or use your savings; you need to have a rainy day fund in place for emergencies.
Whether you are new to running your own business or decided to overhaul and grow your current venture, you will need to face some difficult decisions. Make sure that you consider different options and ask for expert advice before choosing your financing methods, location, taxation, and incorporation form. This will help you prevent some of the legislative and financial problems most new entrepreneurs face in the first few months.