How to Start Your Own Business (And Live Out Those Entrepreneurial Dreams)
If you’re dreaming about becoming an entrepreneur, but you’re just not sure how to start your own business, you’re not alone. There are so many amazing, smart people out there with great ideas, but putting those ideas into action can be intimidating.
That’s not entirely wrong, either. Starting a business is hard work, and can be a risk depending on your individual situation. However, owning a business can be one of the most rewarding and fulfilling things you can do. For many entrepreneurs, there is nothing more thrilling than putting your name on an official business plan and seeing the fruits of your labour come to fruition.
Thinking about taking the next steps and putting plans into action? We’re going to walk you through the process step by step and show you how to start your own business. Get ready for a whirlwind of information you’re going to need to know, from generating an idea to launching a marketing strategy.
Start With an Idea
Naturally, the first thing you need to do is come up with a business idea. You can’t learn how to start your own business if you don’t know what you’re going to do. Chances are, you might already have some idea of what you’d like to do. But if you don’t, that’s perfectly fine – you’ll just have to do a little more research.
When determining what your business idea should be, consider the following factors:
- What industries or niches do you know a lot about?
- Why do you want to start a business in the first place?
- What are your strongest skills?
- Would you be providing a service or a product?
- What are you passionate about?
- Are you going to be starting out full time, or will you build your business on the side until it becomes profitable enough to take on full time?
Before you proceed with your business idea, it’s important to ask yourself: are you ready for this? Not all people are cut out to be entrepreneurs, and it’s going to take a lot of dedication, sacrifice, and hard work to grow your business. If you think you’re ready to make the leap, it’s time to do some market research.
Planning and Market Research
Chances are, if you’re reading articles on how to start your own business, you’re already aware of the importance of doing market research before you make plans and take action. You’ve got your idea, and now it’s time to make sure it’s profitable.
Market research involves identifying and learning more about the following:
- Who your customers will be
- What profit margins look like within your industry
- Who your competitors are
- The demand for your product and any gaps in the market
- What costs you’re going to face and the startup capital you need
- How long it’ll take to you get your product to market
- What price you can sell your products or services for
Here are some things you can do to conduct market research:
- Google searches
- Talk to industry professionals
- Read industry publications
- Consult with legal and financial experts
- Conduct surveys
- Hold focus groups (if you can)
- Take a class (if you can)
With any industry, you need to figure out what your competitive advantage is. Good entrepreneurs are able to determine how their product or service solves a problem, and identify gaps in the marketplace where their business could stand out.
A key goal you’re looking for in your market research is planning your ideal customer profile, narrowing down your target market, and identifying the demand your product or service can potentially generate. Once you get to the marketing stage (we’ll talk more about that later), you can use this information to create buyer personas.
Check the Legal Requirements and Business Laws in Your Area
In order to learn how to start your own business, you need to make sure you are compliant with all business laws and legal requirements in your area. Will your idea even be possible where you live?
Sometimes certain industries will require you to have a certain type of insurance, or operate within a specific scope. For example, in the province of Ontario, if you hire even one employee you are required to register with the Workplace Safety and Insurance Board (WSIB). Other types of businesses, such as those that involve transportation or touch-based services, as well as brick-and-mortar locations, require municipal licences to stay in operation.
You want to make sure you do your research before you open your business, because some of these legal requirements have to happen within a short time frame after you open. For example, in Ontario, you have to register with the WSIB within 10 days of hiring a new employee. It’s best to do this step before you put everything else in place in case it turns out that you have to wait longer or don’t qualify for a certain legal aspect.
To protect yourself in advance, you can ask for advice from a business lawyer or talk to a business consultant in your area to make sure you’re doing everything right. The last thing you need is to go through all of the steps just to find out you missed one legal requirement and can’t operate your business.
Online Commerce vs. Brick-and-Mortar Stores
A major decision you’re going to need to make is whether you will be selling online or opening a brick-and-mortar location. If you’re offering services, will you be using an online portal to book appointments or consultations?
There are advantages and disadvantages to both options, and it will depend on your target market, your business structure, and the product or service you’re planning to offer. Below, we’ll break down the pros and cons for you to make the decision a little easier.
Advantages of a Brick-and-Mortar Location:
- A physical “home” for your company where customers can meet and connect with you face to face
- Customers can try on items, touch them, see them up close, and feel them out before making a purchase
- It’s easier for your customers to make returns (which is a deciding factor for some types of products)
- You get to be a bigger and more involved part of your local community
- If your store is in a location with good foot traffic (like a tourist area) you may reach curious browsers who wouldn’t otherwise find you online
- Customers can receive their items immediately and you don’t have to deal with shipping and delivery companies
- You add legitimacy and trust for your customers, as some people can be nervous about using their credit card online with a company they haven’t purchased from before
Disadvantages of a Brick-and-Mortar Location:
- You’re limited to one place and one local market
- There will be more costs associated with running the business (paying property taxes, employee wages, etc.)
- Customers can only make purchases within your operating hours
- It’s a bigger risk – if your online business doesn’t pan out it’s not a huge deal to re-brand, but if your brick-and-mortar business doesn’t succeed you’ll be out a lot more money and it’s more difficult to move or change your branding
Advantages of an Online Business:
- You can sell to anyone anywhere in the world, which helps increase profits and expands your market
- According to a Big Commerce survey, 67% of millennials and 58% of Gen Zers prefer shopping online, so if these are your target demographics this is the best way to reach them
- The startup and operating costs are much lower
- You’re not limited to operating hours and customers can make purchases at their own convenience
- Re-branding and growing your business is easier
- There are more payment options available online (like PayPal and Bitcoin) than your typical in-store cash, debit, and credit options
Disadvantages of an Online Business:
- Your customers won’t get to see or interact with you or your products before they purchase
- You’ll have to work out the logistics of shipping costs, deliveries, and so on
- Returns are a little more difficult for your customers
- Customers can’t use cash payments
- You’ll need to put in the effort with SEO and digital marketing to get your brand noticed
- It’s more difficult to get a new customer to trust an online business than a brick-and-mortar location
If you’re opening a brick-and-mortar location, you might want to consider selling your items online at the same time to maximize the advantages of both options. Most businesses with physical locations have this option in order to fully expand their reach and customer base, and it offers an extra opportunity for sales in both markets.
Choose Your Business Structure
There are a few different options for choosing your business structure, and this is a decision you should make before you start a business plan. Your business structure will play a role in business and financial decisions, operating costs, taxes, legal requirements, and almost every other aspect of your operation.
Here are the most common types of business structure:
- Corporation: Incorporating your business to create a corporation is a more costly and time-consuming option, but it comes with many advantages for larger scale businesses. A corporation is operated as an independent entity from the business owners or partners, and therefore limited liability is placed on the owners or shareholders.
- Sole Proprietorship: Ideal for self-employed individuals who are planning on running and managing the majority of their business on their own, a sole proprietorship means that you and your business are essentially one entity. While it’s the easiest and cheapest option, sole proprietorship business owners also take complete responsibility for all liability.
- Partnership: A partnership is similar to a sole proprietorship, but involves two or more business owners pooling their resources together and operating the business together. All partners are still considered self-employed and take full liability for the business.
- Limited Liability Company (LLC): An LLC is essentially a hybrid between a sole proprietorship/partnership and a corporation. Business owners are self-employed and can pass profits through personal income, but do not have complete liability and aren’t required to pay corporate taxes.
- Cooperative: With a cooperative, individuals who use the services are also the business owners who split the profits between them. Typically, there will be a board of directors that run the cooperative, and then shareholders that vote on business and financial decisions.
- Non-profit Corporation: A non-profit corporation does work that benefits the public such as charity work, scientific research, social services, religious services, and so on. These businesses are exempt from many types of taxes but must follow some of the regulations set out for corporations.
For more information on each of these types of businesses and which decision will be best for you, check out this guide from New Business Now. It’s also a good idea if you have the ability to speak with a business lawyer who can advise you on the right decision to make for your future goals.
Register Your Business Name
Once you’ve chosen your business structure, you need to decide on and register your business name with your government. Not registering your business name could lead to fines or other consequences you likely don’t want to deal with.
If you’re choosing a sole proprietorship or other type of business and operating it under your own legal name, you don’t need to register your business name. However, if your operating name is going to be different, you’ll need to make sure that it’s a name currently not registered to another business. Additionally, if you are adding another word onto your name, such as “Your Name Consultants,” then you will be required to register your business name.
For corporations, you’re usually required to register your business name when you go through the incorporation process. In Canada, you can register your business name federally or provincially. Registering federally allows you to use your name exclusively across the country with protections, while registering provincially protects you within your province only.
At this point, you may also want to consider registering a trademark. This will add some further protection to your company name and reputation, and gives you the right to report infringements.
Create a Business Plan and Strategy
You’re going to need to create a business plan regardless of the type of business you create. Your business plan serves as a roadmap for the way that you will conduct operations and grow as a company.
Here are some of the elements that should be included in your business plan:
- Your business name
- All business owners’ names
- Your business structure
- Company goals and objectives
- Vision and mission statement
- A SWOT analysis
- Third-party vendors if applicable
- A competitive analysis
- Financial plans and budget analysis
- An operations plan
- Projections for the future
- Exit strategies (as a precaution)
At this stage, it’s helpful to hire a professional business writing team to help create a business plan for your new venture. You’re going to be relying on your business plan for a lot of different aspects, such as applying for any type of financing, opening a business account at a bank, appealing to investors, and more.
Obtain The Proper Licenses and Permits
One key step you do not want to skip over when planning how to start your own business is making sure you have the right permits, licenses, and any other certifications to conduct your business legally. You will need these items in order to open a bank account for your business as well.
Here is a quick list of some of the types of licenses and permits you may need to apply for. Not all of these permits may apply to your specific business, but you should always double-check what you will need to be proactive and protect yourself against legal repercussions.
- Goods and Services Tax/Harmonized Sales Tax Account (GST/HST). In some areas, like Ontario, this is included in your business number (BN).
- A business identification number (BIN)
- Business licenses
- Permits for operating a home-based business
- Zoning permits for brick-and-mortar locations
- Environmental permits
- A DBA license if you’re operating your business under a company name
- Health permits if your business involves food preparation
If you are going to be providing services, you’ll need to be up to date with the required certifications and licenses for your industry. For example, if you are opening a hair salon in Ontario, you need to have a hairstyling certification under the Ontario College of Trades (among other permits).
Check For Government Grants, Financial Support Programs, and Loans
Before you start emptying your savings account, it’s helpful to check your area for grants, investment loans, and other financial support options that might be available to you. Sometimes these grants are awarded for certain types of businesses, like essential services, while others are based on an application process.
Most levels of government in Canada, Europe, and the United Kingdom offer government-led initiatives that provide grant money to entrepreneurs who wish to open certain types of businesses that meet the qualifications. In the United States, the government doesn’t provide business grants but you can locate some alternative resources for loans, grants through private or state-run programs, and other options through the Small Business Association.
It’s relatively easy to find all of this information online. For example, if you live in Canada, you can check the Government of Canada website for resources on loans and grants for startup businesses, and determine if you qualify for any financial assistance programs.
A Checklist For Online Businesses
If you’re considering launching an online business, you don’t have to deal with the logistics of a physical business location, but there are some considerations you should know.
Here is a checklist of things to consider when you’re planning out how to start your own business online:
- Choose the right ecommerce platform for your business structure. Every platform comes with its own set of advantages and disadvantages.
- Determine which shipping and delivery methods you’ll use. Will you use dropshipping, local delivery, or package everything yourself?
- Consider the payment processing options you’ll implement. Will you accept PayPal, Apple Pay, Google Pay, online debit, credit cards, bitcoin, or a selection of these options? The more payment options you have, the easier it is for your customers to make a purchase.
- Purchase a domain name and decide on your hosting needs. Your domain name should be as close as you can get to your business name so it’s easier for your customers to find you.
- Consider working with a web developer to create a scalable website. Sure, you could create your own shop with a pre-built Shopify template, but a web developer can give you the exact tools you need to stand out online and make your business more profitable.
Opening a Brick-and-Mortar Business Location
If you’re planning on going the brick-and-mortar route, you need to take a few extra steps to find the right business location. This can be a tricky decision, especially in a highly competitive and busy city such as Toronto or New York.
You need to choose a business location that not only works with your budget, but for your ideal customer as well. For example, if you’re in a big city where people rely primarily on public transportation, you ideally would want to be located near a subway or bus stop. If you’re in a location where most people drive their own vehicles, make sure parking won’t be an issue.
Your physical business location will also play a role in obtaining those licenses and permits we discussed earlier, so make sure you choose wisely and do your research. There are different zoning and operating regulations as well as legal requirements depending on where you live or where you’re going to open your business.
Build a Website
Whether you’re figuring out how to start your own business entirely online or in a brick-and-mortar location, you’re going to need a website. Your website is your business’ online home that gives your potential customers their first impression of who you are, and provides them with the information they need to make a purchase or visit your store.
Even if you aren’t planning on selling online, your website will be a key tool in getting your business noticed to new customers in your community. You’ll need it to utilize local SEO – according to a study, 72% of people search a business online before visiting in person, and 86% of people rely on search engines to find local businesses. Those are some big statistics you’ll want to leverage even if you don’t sell products online.
If you operate a service, try to take advantage of your website by allowing online booking, reservations, or even just downloadable service lists and menus. Adding these small but convenient features will appeal to a larger range of people.
No matter what you’re using your website for, make sure you work out all the kinks before you go live. Fill out every form, try making every mistake a customer might make (to ensure your website won’t crash), process test payments, and check that all links go to the right place. If you need the extra help, don’t be afraid to reach out to a website content writing company to give you the tools you need to optimize for SEO and create dynamic content tailored to your audience.
Develop a Good Digital Marketing Strategy
Once you’ve put all the tools in place to launch your brand new business, it’s time to start getting the word out. In today’s day and age, a good digital marketing strategy is essential to your success, no matter what type of business you’re opening. In fact, you should plan out a digital marketing strategy and have it ready to go before you hit that launch button so you can start immediately.
Digital marketing is much cheaper than traditional marketing, and leads to a higher return on investment (ROI) because you can easily target the specific audiences that will be interested in your product or service. However, that doesn’t mean you shouldn’t overlook the value of traditional marketing as well, especially if you have a brick-and-mortar location.
Get your social media accounts set up, start planning out your advertising, and set aside a decent budget to build awareness. You need to reach the people you want to sell your items to if you want to start turning a profit as soon as possible.
Build Some Valuable Content
Every business, whether you are selling online or not, should have a content strategy in place. A content strategy involves making and sharing content on your website and through digital marketing that is designed to provide value to your target audience and increase your SEO presence. Essentially, your content helps you catch your audience’s attention, increase traffic to your website, and improve your conversion rates.
Here are some types of content you could try depending on the type of business you’re opening:
- Self-publish an ebook that explains how to use your product, or that adds additional value for your audience
- Blogs on your website
- Targeted landing pages and service pages
- Long-form content (2,000+ word blogs like this one)
- Infographics or how-to guides
- Case studies
- Templates or customized downloads
If you need help building out a content marketing strategy, check out the step by step process we’ve outlined on our blog for more resources and information.
Need More Help Learning How to Start Your Own Business? Talk to an Expert
Learning how to start your own business can be pretty complex, and since this is going to become your livelihood, you want to make sure you’re doing it properly. The steps we’ve outlined above are just the beginning, and running your business is going to become your entire world. For that reason, you want to make sure you get it right the first time around to avoid any headaches or missteps.
At The Write Direction, we have all the tools and resources you need to conduct market research, create an amazing business plan, build an SEO-optimized website, and create a successful digital marketing strategy.
Get in touch with us now to start talking business!