The labor market is constantly changing and many people are looking for new ways to establish themselves financially. For some time now, entrepreneurship has become a working model desired by many, but few people know where to start.
If you feel that it is time to undertake and be your own boss, you need to understand the path you will have to follow to reach your dreamed business. To help you on this journey, we have created a step-by-step for you to believe in your ideas and understand that it takes a lot of work and especially planning to undertake.
Establish a goal
The first step to starting your own business is to establish a goal. Determine exactly what your company’s product or service will be and what goals will be achieved.
At this point, you need to put your ideas on paper and ask yourself if they are feasible. The next steps will answer that question.
Analyze the market
Making an analysis of the market you want to enter is an essential step towards success. To do so, keep in mind the peculiarities of the market segment, analyze which will be your competitors and know very well the profile of your customers.
Market segment
The segment is what divides the consumers of the same product by profiles, when determining the market segment you know the target of your company, so it is easier to think your strategies and how the development of your product or service will be done.
Competition
Knowing what your competitors are and what their defects and qualities are leaves you one step ahead. This is the time to reflect which market needs are already met by your competitors and which can still be explored by you.
Customers
One of the most important parts for your business to be successful is to conquer and retain your customers, so it is very important to know them well and understand what their needs and problems are that your company seeks to solve.
To understand the profile of your customers it is necessary to ask three questions:
Who is it?
What does it seek?
Why does it seek?
Categorize your product / service
The next important step in starting your business is to categorize your product or service, i.e. to have well defined what you will sell or what service you will provide to your consumer.
When establishing your segment, you will have clear some aspects of your product because you will know the language you should use to reach your target audience. From there you will define your distribution channels, communication actions, and pricing policy.
Distribution channels
Distribution channels are the means by which your product will reach your end customer, so it is how you will distribute your product.
Communication Strategies
How you will communicate with your customers is also of paramount importance and should be taken into account from the very beginning of your business.
Be well defined about the means by which you will communicate with your audience and the language you intend to use. Know that this will be the personality of your company and therefore an important factor at the time your customer decides whether or not to be a consumer of your product or service.
Pricing Policy
After knowing the characteristics of your audience, the peculiarities of your competitors and categorizing your products or services you will need to define a pricing policy.
Remember that the price you determine can be attractive, but your company should not be chosen only because it has the lowest price, so know how to add value to your company so that your customer is loyal not because you sell the cheapest product, but because it has a differential that captivates you.
Establish an operating mode
The mode of operation is how your company will function, what are the necessary means for your business to produce and then serve your customers.
For this it is necessary to plan in advance if you will need a space, how big it needs to be, what equipment and staff will be needed to produce and how long it will take.
Equipment
Make a survey of all the equipment that will be needed for your company to start producing. Include production machines, computers, vehicles and any other material that will need to be purchased to get the company up and running.
Employees
Calculate the need for personnel to work in your company. What positions will be needed and what the roles of each of them will be.
Time
Determine how long it will take to produce your product or perform your service. At this point, you need to take into account the time you will need to serve your end customer.
Plan your finances
After defining all the necessary aspects for your company to function it is time to think about how much money will need to be invested to put your business into practice.
At this point it is important to evaluate the need for financing and if you will have enough return to keep the company running and repay your loan.
Initial costs
Initial costs are all those expenses that will be required to start your business.
They include registration fees, space rental, purchase of machinery, purchase of computers and other essential elements for the start of operations.
Expenses and revenues
In this category include all expenses that will be fixed, such as rent, consumption accounts, employee salaries, and others.
Working capital
The working capital will be the value that will guarantee the normal functioning of your company, it should be sufficient so that for a period of time your expenses and income are covered.
Cash flow
The cash flow is an amount that takes your expenses into account in relation to your earnings, so when the earnings are higher than the expenses your cash flow is positive, on the other hand, if the expenses are higher than the earnings the cash flow is negative.
Profits
Your profit will be the spare value before a positive cash flow. It is common for you to have little or no profit at all at the start of a business, or for this value to be used only to cover the initial costs.
Take into account the possibility that your company may take a long time to generate profit, so your financial planning should be well prepared and you should be financially secure for this initial period.
Formalize your company
The last step to open your business is also one of the most important, it consists of formalizing your company. In order for your business to work within the law, you need to register it with the competent authorities in your region and pay all the necessary taxes.
Remember that working informally can create future problems for you and your company, so do everything necessary to have your business formalized.
Believe in your potential
Finally, be sure to believe in your potential, the paths in the world of entrepreneurship are long and often challenging, but with persistence, it is possible to achieve success.
Another important point to be raised is the need to always be prepared to reach your goals, get educated, take courses, attend lectures and groups of entrepreneurs, so you will always be updated and therefore in front of your competitors.
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