building a business plan from scratch

How to Write a Business Plan: Your Step-by-Step Guide

So, you’ve got an idea and you want to start a business —great! Before you do anything else, like seek funding or build out a team, you'll need to know how to write a business plan. This plan will serve as the foundation of your company while also giving investors and future employees a clear idea of your purpose.

Below, Lauren Cobello, Founder and CEO of Leverage with Media PR , gives her best advice on how to make a business plan for your company.

Build your dream business with the help of a high-paying job—browse open jobs on The Muse »

What is a business plan, and when do you need one?

According to Cobello, a business plan is a document that contains the mission of the business and a brief overview of it, as well as the objectives, strategies, and financial plans of the founder. A business plan comes into play very early on in the process of starting a company—more or less before you do anything else.

“You should start a company with a business plan in mind—especially if you plan to get funding for the company,” Cobello says. “You’re going to need it.”

Whether that funding comes from a loan, an investor, or crowdsourcing, a business plan is imperative to secure the capital, says the U.S. Small Business Administration . Anyone who’s considering giving you money is going to want to review your business plan before doing so. That means before you head into any meeting, make sure you have physical copies of your business plan to share.

Different types of business plans

The four main types of business plans are:

Startup Business Plans

Internal business plans, strategic business plans, one-page business plans.

Let's break down each one:

If you're wondering how to write a business plan for a startup, Cobello has advice for you. Startup business plans are the most common type, she says, and they are a critical tool for new business ventures that want funding. A startup is defined as a company that’s in its first stages of operations, founded by an entrepreneur who has a product or service idea.

Most startups begin with very little money, so they need a strong business plan to convince family, friends, banks, and/or venture capitalists to invest in the new company.

Internal business plans “are for internal use only,” says Cobello. This kind of document is not public-facing, only company-facing, and it contains an outline of the company’s business strategy, financial goals and budgets, and performance data.

Internal business plans aren’t used to secure funding, but rather to set goals and get everyone working there tracking towards them.

As the name implies, strategic business plans are geared more towards strategy and they include an assessment of the current business landscape, notes Jérôme Côté, a Business Advisor at BDC Advisory Services .

Unlike a traditional business plan, Cobello adds, strategic plans include a SWOT analysis (which stands for strengths, weaknesses, opportunities, and threats) and an in-depth action plan for the next six to 12 months. Strategic plans are action-based and take into account the state of the company and the industry in which it exists.

Although a typical business plan falls between 15 to 30 pages, some companies opt for the much shorter One-Page Business Plan. A one-page business plan is a simplified version of the larger business plan, and it focuses on the problem your product or service is solving, the solution (your product), and your business model (how you’ll make money).

A one-page plan is hyper-direct and easy to read, making it an effective tool for businesses of all sizes, at any stage.

How to create a business plan in 7 steps

Every business plan is different, and the steps you take to complete yours will depend on what type and format you choose. That said, if you need a place to start and appreciate a roadmap, here’s what Cobello recommends:

1. Conduct your research

Before writing your business plan, you’ll want to do a thorough investigation of what’s out there. Who will be the competitors for your product or service? Who is included in the target market? What industry trends are you capitalizing on, or rebuking? You want to figure out where you sit in the market and what your company’s value propositions are. What makes you different—and better?

2. Define your purpose for the business plan

The purpose of your business plan will determine which kind of plan you choose to create. Are you trying to drum up funding, or get the company employees focused on specific goals? (For the former, you’d want a startup business plan, while an internal plan would satisfy the latter.) Also, consider your audience. An investment firm that sees hundreds of potential business plans a day may prefer to see a one-pager upfront and, if they’re interested, a longer plan later.

3. Write your company description

Every business plan needs a company description—aka a summary of the company’s purpose, what they do/offer, and what makes it unique. Company descriptions should be clear and concise, avoiding the use of jargon, Cobello says. Ideally, descriptions should be a few paragraphs at most.

4. Explain and show how the company will make money

A business plan should be centered around the company’s goals, and it should clearly explain how the company will generate revenue. To do this, Cobello recommends using actual numbers and details, as opposed to just projections.

For instance, if the company is already making money, show how much and at what cost (e.g. what was the net profit). If it hasn’t generated revenue yet, outline the plan for how it will—including what the product/service will cost to produce and how much it will cost the consumer.

5. Outline your marketing strategy

How will you promote the business? Through what channels will you be promoting it? How are you going to reach and appeal to your target market? The more specific and thorough you can be with your plans here, the better, Cobello says.

6. Explain how you’ll spend your funding

What will you do with the money you raise? What are the first steps you plan to take? As a founder, you want to instill confidence in your investors and show them that the instant you receive their money, you’ll be taking smart actions that grow the company.

7. Include supporting documents

Creating a business plan is in some ways akin to building a legal case, but for your business. “You want to tell a story, and to be as thorough as possible, while keeping your plan succinct, clear, interesting, and visually appealing,” Cobello says. “Supporting documents could include financial projects, a competitive analysis of the market you’re entering into, and even any licenses, patents, or permits you’ve secured.”

A business plan is an individualized document—it’s ultimately up to you what information to include and what story you tell. But above all, Cobello says, your business plan should have a clear focus and goal in mind, because everything else will build off this cornerstone.

“Many people don’t realize how important business plans are for the health of their company,” she says. “Set aside time to make this a priority for your business, and make sure to keep it updated as you grow.”

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How to Write a Business Plan, Step by Step

Rosalie Murphy is a small-business writer at NerdWallet. Since 2021, she has covered business insurance, banking, credit cards and e-commerce software, and her reporting has been featured by The Associated Press, MarketWatch, Entrepreneur and many other publications. Rosalie holds a graduate certificate in Quantitative Business Management from Kent State University and is now pursuing an MBA. She is based in Chicago.

Ryan Lane is an editor on NerdWallet’s small-business team. He joined NerdWallet in 2019 as a student loans writer, serving as an authority on that topic after spending more than a decade at student loan guarantor American Student Assistance. In that role, Ryan co-authored the Student Loan Ranger blog in partnership with U.S. News & World Report, as well as wrote and edited content about education financing and financial literacy for multiple online properties, e-courses and more. Ryan also previously oversaw the production of life science journals as a managing editor for publisher Cell Press. Ryan is located in Rochester, New York.

Many or all of the products featured here are from our partners who compensate us. This influences which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money .

What is a business plan?

1. write an executive summary, 2. describe your company, 3. state your business goals, 4. describe your products and services, 5. do your market research, 6. outline your marketing and sales plan, 7. perform a business financial analysis, 8. make financial projections, 9. summarize how your company operates, 10. add any additional information to an appendix, business plan tips and resources.

A business plan outlines your business’s financial goals and explains how you’ll achieve them over the next three to five years. Here’s a step-by-step guide to writing a business plan that will offer a strong, detailed road map for your business.

LLC Formation

A business plan is a document that explains what your business does, how it makes money and who its customers are. Internally, writing a business plan should help you clarify your vision and organize your operations. Externally, you can share it with potential lenders and investors to show them you’re on the right track.

Business plans are living documents; it’s OK for them to change over time. Startups may update their business plans often as they figure out who their customers are and what products and services fit them best. Mature companies might only revisit their business plan every few years. Regardless of your business’s age, brush up this document before you apply for a business loan .

» Need help writing? Learn about the best business plan software .

This is your elevator pitch. It should include a mission statement, a brief description of the products or services your business offers and a broad summary of your financial growth plans.

Though the executive summary is the first thing your investors will read, it can be easier to write it last. That way, you can highlight information you’ve identified while writing other sections that go into more detail.

» MORE: How to write an executive summary in 6 steps

Next up is your company description. This should contain basic information like:

Your business’s registered name.

Address of your business location .

Names of key people in the business. Make sure to highlight unique skills or technical expertise among members of your team.

Your company description should also define your business structure — such as a sole proprietorship, partnership or corporation — and include the percent ownership that each owner has and the extent of each owner’s involvement in the company.

Lastly, write a little about the history of your company and the nature of your business now. This prepares the reader to learn about your goals in the next section.

» MORE: How to write a company overview for a business plan

The third part of a business plan is an objective statement. This section spells out what you’d like to accomplish, both in the near term and over the coming years.

If you’re looking for a business loan or outside investment, you can use this section to explain how the financing will help your business grow and how you plan to achieve those growth targets. The key is to provide a clear explanation of the opportunity your business presents to the lender.

For example, if your business is launching a second product line, you might explain how the loan will help your company launch that new product and how much you think sales will increase over the next three years as a result.

» MORE: How to write a successful business plan for a loan

In this section, go into detail about the products or services you offer or plan to offer.

You should include the following:

An explanation of how your product or service works.

The pricing model for your product or service.

The typical customers you serve.

Your supply chain and order fulfillment strategy.

You can also discuss current or pending trademarks and patents associated with your product or service.

Lenders and investors will want to know what sets your product apart from your competition. In your market analysis section , explain who your competitors are. Discuss what they do well, and point out what you can do better. If you’re serving a different or underserved market, explain that.

Here, you can address how you plan to persuade customers to buy your products or services, or how you will develop customer loyalty that will lead to repeat business.

Include details about your sales and distribution strategies, including the costs involved in selling each product .

» MORE: R e a d our complete guide to small business marketing

If you’re a startup, you may not have much information on your business financials yet. However, if you’re an existing business, you’ll want to include income or profit-and-loss statements, a balance sheet that lists your assets and debts, and a cash flow statement that shows how cash comes into and goes out of the company.

Accounting software may be able to generate these reports for you. It may also help you calculate metrics such as:

Net profit margin: the percentage of revenue you keep as net income.

Current ratio: the measurement of your liquidity and ability to repay debts.

Accounts receivable turnover ratio: a measurement of how frequently you collect on receivables per year.

This is a great place to include charts and graphs that make it easy for those reading your plan to understand the financial health of your business.

This is a critical part of your business plan if you’re seeking financing or investors. It outlines how your business will generate enough profit to repay the loan or how you will earn a decent return for investors.

Here, you’ll provide your business’s monthly or quarterly sales, expenses and profit estimates over at least a three-year period — with the future numbers assuming you’ve obtained a new loan.

Accuracy is key, so carefully analyze your past financial statements before giving projections. Your goals may be aggressive, but they should also be realistic.

NerdWallet’s picks for setting up your business finances:

The best business checking accounts .

The best business credit cards .

The best accounting software .

Before the end of your business plan, summarize how your business is structured and outline each team’s responsibilities. This will help your readers understand who performs each of the functions you’ve described above — making and selling your products or services — and how much each of those functions cost.

If any of your employees have exceptional skills, you may want to include their resumes to help explain the competitive advantage they give you.

Finally, attach any supporting information or additional materials that you couldn’t fit in elsewhere. That might include:

Licenses and permits.

Equipment leases.

Bank statements.

Details of your personal and business credit history, if you’re seeking financing.

If the appendix is long, you may want to consider adding a table of contents at the beginning of this section.

How much do you need?

with Fundera by NerdWallet

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Here are some tips to write a detailed, convincing business plan:

Avoid over-optimism: If you’re applying for a business bank loan or professional investment, someone will be reading your business plan closely. Providing unreasonable sales estimates can hurt your chances of approval.

Proofread: Spelling, punctuation and grammatical errors can jump off the page and turn off lenders and prospective investors. If writing and editing aren't your strong suit, you may want to hire a professional business plan writer, copy editor or proofreader.

Use free resources: SCORE is a nonprofit association that offers a large network of volunteer business mentors and experts who can help you write or edit your business plan. The U.S. Small Business Administration’s Small Business Development Centers , which provide free business consulting and help with business plan development, can also be a resource.

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Building anything from scratch is a worthwhile challenge.

Baking bread, assembling a bookcase, shaping your career, forming a family—all start with next-to-nothing and end in marvelous works of art. It’s not easy to create something from scratch, but it’s oh-so rewarding.

Building a business is no different. You start with diddly-squat, throw in a bit of hard work and ingenuity, and bring a life-changing idea to existence.

But, where do you begin?

Ah, that’s a good question. Fortunately, you’ve come to the right place. Our CEO, Nathan Chan, built Foundr from the ground up 10 years ago, so we know a little something-something about building a successful startup with nothing but a seed of an idea and perspiration.

Below, we’ll walk you step by step through how to start a business from scratch. While it’s possible just to wing it and stumble upon success, we believe following a proven roadmap will lead to better odds of triumph—there’s a reason 90% of startups fail .

You won’t be part of that statistic, though, because you’re going to do things the right way. And we’re going to help.

How to Start a Business from Scratch: 10-Step Process

10 steps might sound like a bit much to learn how to start a business from scratch but bear with us. You’ll already know some of this information, and other parts will be brand-new. Feel free to skip around or take it step by step.

We link out to other robust pieces of content (blog posts, videos, and podcasts) to help you learn and absorb everything you need to know to get started. Consider this the go-to resource center for starting your business—we’ll direct you to every tool, lesson, and best practice you need, regardless of where you are in the process.

Use the table of contents below to jump to the right resources faster. Plus, bookmark this article so you can find what you need (when you need it) every step of the way.

Table of Contents

1. Find a Need

2. validate your idea, 3. identify your target market, 4. build your audience, 5. launch an mvp, 6. create a business plan, 7. secure your business and brand, 8. market your products, 9. sell like a boss, 10. scale efficiently.

AI Tools to Start a Business

How to Start a Business From Scratch FAQ

Most businesses fail because they start with a product, service, or brilliant idea. Scratch that and take a step back.

Forget about any innovative solutions or game-changing notions. First, you need to find a problem. It could be your problem, a neighbor’s problem, or a near-and-dear community’s problem. Find it.

Try out these 4 strategies to find inspiration for your business idea:

• Write Down Your Current Problems and Interests: What issues and concerns keep you up at night? What would you pay good money to have someone else fix for you?
• Check Out Product Review Blogs: Have you noticed an under-performing product with potential? What are customers complaining (and praising) about the product? Could you create something better?
• Explore Niche Communities on Reddit: Reddit is a gold mine of customer research. Browse around niche subreddits to see what’s generating hype. Notice any trends?
• Browse Consumer Marketplaces: Best-selling products on Amazon , Etsy, and eBay made it to the top spot for a reason. Analyze what they’re doing right, identify gaps, and see where you might fit in.

These are all just starting points. You’ll still need to validate these ideas to ensure they solve problems for a larger customer base and that they’re willing to pay for a solution. Once you’ve zeroed in on the problem, start brainstorming a product or service that solves it.

Here are a few characteristics of product ideas (that don’t suck) :

• Provides a Strong USP: Your product’s unique selling proposition (USP) makes it stand apart from the competition.
• Delivers Profit Potential: A product idea isn’t good if it can’t be scaled for profit. Think about pricing, expenses, supply and demand, and your audience to determine your product’s long-term profitability.
• Makes Customers Pay: Not every seemingly good idea is worth paying for—Snapchat Spectacles, anyone?
• Satisfies Demand: Some problems aren’t worth solving.
• Doesn’t Confuse Customers: If you can’t explain it to your mom in 60 seconds, it probably needs to go back to the drawing board.

Now that you have a solid business idea, it’s time to justify it. You’re going to be spending a lot of time, money, and energy on your business—it’s best to ensure it has a chance from the get-go before you invest too many resources.

Fortunately, validation isn’t too tricky. The hardest part is listening to feedback and analyzing your business idea objectively. Do that, and you’ll be fine.

Use the following methods to validate your idea. You don’t need to use all of them. Find one that works best for you, your industry, and your situation:

• Foundr’s 3-Step Validation Process: First, launch a survey to your target audience to ask them a few questions. Second, analyze the responses and look for trends and pain points. Lastly, pre-sell your product or service at a discounted rate to see if customers will put their money where their mouth is.
• Smoke Test: We use this method to validate all our online course ideas. Set up a landing page and drive traffic (using social media, email marketing, and pay-per-click (PPC) advertisements). You don’t even need a completed product yet—just market your idea and see how many people click the big red “Buy Now” button.
• Harry’s Consumer Research: Jeff Raider and Andy Katz-Mayfield used insights research, focus groups, customer surveys, dummy brands, and live testing to validate Harry’s razors.
• Digital Tools: While these tools are used to validate blog post ideas, they can also substantiate your business. Post ideas on Quora, Instagram, TikTok, and Reddit to see if there’s an appetite. If no one is interested in an idea, there’ll probably be crickets when you launch the actual product, too.

Your target market is the lifeblood of your business. You can’t succeed if you don’t come to know every teeny-tiny aspect of their wants, needs, fears, desires, problems, and aspirations.

How do they spend their day? Do they have kids? Are they lactose intolerant? Do they ride a bike or drive a car to work?

Use our Guide to Defining Your Target Market to help establish your audience and learn more about them. Here’s the TLDR:

• Start Specific, Then Broaden: Instead of starting broad with “Who is my target market,” begin narrow with “Who will be drawn to this product or service?”
• Analyze the Overall Market: Identify what’s trending and what might hurt or help your business. Other market factors will impact your target market, so it’s best to get ahead of the curve.
• Reference Your Competitors: Who are your competitors targeting? How do they approach their marketing? Have they left out any key niches?
• Use Your Social Media Data: Social media platforms (for better or worse) already collect tons of data about your followers. Reference this data to learn about their demographics and psychographics.

Once you’ve narrowed down your target market, it’s time to do additional segmentation. For example, if your audience is male soccer players, you’ll want to break that group down into smaller subsections. You might have:

• Recreational male soccer players
• High school male soccer players
• Competitive male soccer players
• Male soccer players who watch more than they play
• Male soccer players who coach

Your target market isn’t one homogenous blob. These segmented groups would likely respond to different marketing and sales approaches. The further you segment your audience, the more equipped you’ll be to create personalized messaging.

OK, now you have a validated idea and a framed portrait of your target market—that’s a great start! Next, you need to begin building an audience.

Your audience comprises social media followers, email subscribers, podcast listeners, phone numbers, blog readers, and interested shoppers—basically, anyone familiar with your brand that’s primed and ready to convert when your product launches.

Let’s start with building brand awareness. 8 Foolproof Strategies to Increase Brand Awareness walks you through plenty of budget-friendly ways to make your brand recognizable. Here are a few highlights:

• Tell a Story: People don’t remember products—they remember stories. Make your brand larger than life by making it about more than just money, products, and features.
• Solve a Problem: Solutions market themselves better than products. Your customer should be daydreaming about how your brand could improve their lives.
• Win the Right Keywords: Make your brand show up wherever your audience spends their digital time.

Check out the following guides for more channel-specific audience building:

• Build an Email List From the Ground Up (The Right Way)
• 16 Ways to Find (and Win) Your Dream Customers
• Facebook Ad Targeting: Find Customers Like a Marketing Eagle Eye
• How to Get More Views on YouTube
• Build a Podcast Audience

Time to make your idea a reality. Instead of spending months or years polishing the perfect product, launch fast and light with a minimum viable product (MVP) .

An MVP is the most basic version of your product that a customer can use. Take Facebook, for example. Facebook’s MVP was the original dumbed-down version that didn’t have a marketplace, groups, video, stories, gaming, or news—it was just a rudimentary social media network with friends and updates (imagine that).

Here are 3 ways to launch better MVPs :

• Shift to an MLP Mindset: MLP stands for minimum loveable product. Don’t just launch a product that works—launch something your customers love.
• Go Live with a Soft Launch: You don’t need a press release and fireworks when you first roll out your product. Keep things light and casual at first.
• Test Your Ideas First: Your MVP isn’t the validation. You should have already validated your idea before producing the product .

Writing a business plan might feel old-school and outdated, but it has a few data-backed benefits for businesses , including:

• Higher average annual growth
• Greater chances of success
• Improved business performance

Get out a pencil and some notepad and get to work. A business plan will keep you on track and ensure you’re headed in the right direction. It outlines your processes, goals, budgets, market research, financing strategy, and more.

Include these 6 essential elements in your business plan :

• Executive Summary: Summarizes your entire plan in a concise one-pager.
• Business Overview: Outlines the business details: structure, ownership, location, products, and mission statement.
• Products and Services: Breaks down your solutions in minute detail.
• Market Analysis: Describes the state of the market and key opportunities (and threats).
• Competitive Analysis: Analyzes competitors’ strengths and weaknesses.
• Financial Strategy: Explains projected revenue, expenses, profits (or losses), and financing strategies.

Now that you have a product MVP, business plan, and target audience, you need to make your business official. The first step is to create a brand around your idea. A brand includes the name, logo, website, and social imagery, but it’s a continual practice you’ll need to focus on as much as product development, finding customers, and leading your team.

Here’s a list of brand-building guides to get you started:

• Coming up with a Business Name That Shines
• How to Choose the Right Color for Your Logo: The Ultimate Cheat Sheet
• What’s the Best Website Builder for Small Business?
• How to Set Up a Website in Less than 60 Minutes
• 3 Small Business Branding Tips to Rise Above the Competition
• 8 Foolproof Strategies to Increase Brand Awareness 

Making your business secure is more than buying a website URL and securing social handles (which are important). It’s about legally securing the necessary information to ensure your idea, logo, and name aren’t stolen. Plus, filing the correct tax information (depending on your business origin) can protect you from legal actions or owing on taxes.

Here’s a list of things you need to do to secure your business legally and make it official:

• Register your business with the state
• Get a tax ID number
• Create a business bank account
• Official licenses or certifications (if necessary)
• Obtain business insurance (if necessary)

At foundr, we always suggest consulting a tax professional in regard to registering your business.

Finally, we’ve made it to the marketing portion. For many entrepreneurs, this is the best part—and it’s a heck of a lot better than the next stage: selling.

Marketing includes the strategies and tactics ( not the same, by the way ) you use to get your brand in front of potential buyers. It includes elements like content marketing, advertising, social media marketing, video marketing, and ecommerce marketing.

Before you get too into the weeds, take a step back and approach your marketing strategy step by step with our guide: How to Create a Marketing Plan (Outline + Examples) . It’ll help you focus and ensure your strategy is cohesive and goal-driven.

Once you’ve identified the channels you want to use, check out the following guides and interviews to put your plan into action:

• Content Marketing: The Ultimate Content Marketing Strategy for Startups
• Social Media Marketing: Increase Social Media Reach
• Video Marketing: 5 Steps to a Successful YouTube Marketing Strategy
• Ecommerce Marketing: How to Start an Ecommerce Business
• Affiliate Marketing: Ultimate Guide to Affiliate Marketing
• Influencer Marketing: Influencer Marketing 101
• Podcast Marketing: Podcast Marketing Guide

Sales. Would-be entrepreneurs, don’t panic. You can do this.

Validating your idea, finding your niche, producing your product, and building brand awareness means nothing in the end if you can’t make money. Fortunately, selling your product doesn’t have to feel like an awkward encounter with a door-to-door solar panel representative.

Don’t worry—we hate cringe-worthy sales tactics, too. Check out these resources to help you monetize everything from your email list to your Instagram following (without selling your soul):

• How to Write a Sales Email That Converts
• 5 Best Sales Funnel Software Tools to Power Your Business
• How to Get B2B Leads for Your Online Business
• Need Shopify Help? Here Are 5 Ways to Increase Your Shopify Sales
• How to Create a Video Sales Letter (Tips and Tricks from a 7-Figure Copywriter)
• 12 Upselling Tips and Best Practices to Boost Your Sales

Once you’ve started making money, it’s time to scale your business. Scale looks different for everyone based on their goals, expectations, and bandwidth.

Scale for one entrepreneur could be launching new products, while scale for another might be reducing costs and maximizing profits for existing goods.

Remember why you wanted to start your business from scratch. Did you want to make more money, or did you want more free time? Did you want to control your career, or did you want to help your community with a problem?

At Foundr, we’re all about empowering would-be-business owners with scalable strategies. Here’s how our interviewees and students scaled their businesses:

• GrubHub Founder Mike Evans is Back to Fix the Home Repair Industry
• How Jessica Sepel Built JSHealth’s Women-Run Brand 
• How Zeb Evans Built ClickUp from Life-Threatening Moments 
• Why Kendra Scott Risked Everything on the Customer Experience
• How April Scott Started a Luxury Sleepwear Brand From Scratch
• How Samantha Brett Built Naked Sundays into Australia’s #1 SPF Skincare Brand

Use AI Tools to Help Start Your Business

AI tools give your startup the advantage it needs to compete with the big dogs. It’s no longer a nice-to-have—it’s a necessity in today’s fast-paced and technology-driven business world.

These AI tools can streamline various aspects of launching and managing a startup, from ideation and market research to branding and customer engagement. Below, we’ll show you some of our favorite AI tools for starting and growing your business.

1. Ideating

• GravityWrite : Assists in brainstorming and ideation processes, providing creative suggestions and inspiration.
• Copy.ai : Utilizes AI to generate high-quality copy for various purposes, ideal for marketing, product descriptions, and more.
• Spin Rewriter : An AI-powered tool that rephrases existing content to enhance readability and uniqueness.
• Claude : Offers sophisticated editing and language enhancement features to refine your written content.
• ChatGPT : Provides versatile assistance in editing and improving text, from emails to business proposals.

3. Graphic Design

• Color Mind : AI tool for color scheme generation, perfect for branding and web design.
• Looka : Combines AI with design principles to create professional logos and brand assets.
• Booth AI : Offers automated photo editing and enhancement, suitable for product images and marketing materials.

4. Video/Audio

• Runway ML : An AI platform for video editing and motion graphics, simplifying complex video production tasks and letting you create video from text.
• Descript : Provides audio and video editing capabilities using AI, with features like auto transcription.
• Dall-e : AI tool for generating custom, high-quality images and artwork, useful for video thumbnails and visual content.

5. Ecommerce and Marketing

• Short Script : Assists in creating concise, compelling scripts for marketing and promotional videos.
• Rizz : An AI-driven tool for optimizing marketing strategies and customer engagement.
• Printful : Integrates AI in print-on-demand services, aiding in product customization and ecommerce operations.

6. Business Assistants

• Browse AI : Automates web data extraction and analysis, useful for market research and competitor analysis.
• Mem : AI-powered memory tool that helps organize and recall important business information.
• Rapidely : A versatile AI assistant designed to streamline various business operations, including scheduling and task management.

How to Start a Business from Scratch FAQ

How much of my business should i be involved in.

It's easy to get caught micro-managing every nitty-gritty component of your business, but you have bigger fish to fry. Outsource your trivial to-do list (invoicing, calendaring, procurement, and the like) to a full-time hire or a freelancer.

What's the best time to start a business from scratch?

There's no perfect time to start a business from scratch. The important thing is to start and stay persistent through all the steps.

Should I start my business alone?

Nobody truly starts a business alone. You need a support system to help you along your entrepreneurship journey, even if that's a friend, spouse, or parent. Many of the iconic businesses you know today began with a cohort of co-founders, but having one is not necessary. What is essential are trusted people around you to help bring your vision to life.

Exclusive Training to Help Launch Your Business

Congratulations! If you follow the 10-step process above, you’ll start a business from scratch that’s ready to join the 10% of startups that don’t fail.

Don’t worry—we’re still here to help. We won’t throw you into the deep end and expect you to figure everything out on your own.

That’s why we built foundr+, an all-access pass of training courses that will teach you everything you need to start and grow your business—whether you need to finance your startup, grow your Instagram following, or launch a profitable ecommerce store.

About Jesse Sumrak

Jesse Sumrak is a writing zealot focused on creating killer content. He’s spent almost a decade writing about startup, marketing, and entrepreneurship topics, having built and sold his own post-apocalyptic fitness bootstrapped business. A writer by day and a peak bagger by night (and early early morning), you can usually find Jesse preparing for the apocalypse on a precipitous peak somewhere in the Rocky Mountains of Colorado.

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How to Start a Business From Scratch in 6 Easy Steps

10 min. read

Updated April 30, 2024

Did you know that most of the world’s new businesses are bootstrapped ? 

That’s right, most business owners do not launch with loans or outside investment but instead use their personal resources and savings to get up and running. They start from scratch and reinvest in the business as it gains traction.

And you can do the same. 

Key Takeaways:

• Start with an idea that uses your experience, knowledge, or passion.
• Determine if there’s a need for your product or service.
• Create a plan and financial forecasts.
• Treat it like a side hustle until you get traction.
• What does it mean to start from scratch?

“Starting a business from scratch” does not mean:

• Using no money to launch your business.
• Getting no outside assistance.
• Inventing a business idea no one has done before.

Starting from scratch is about building a business from the ground up, using personal resources and minimal external financial support. The goal is to establish a sustainable business you control that satisfies a need in the market. 

• Why start a business from scratch?

Here’s why starting from scratch might be the right approach for you:

• Risk reduction: Control your initial investment and expenses and scale gradually, allowing you to avoid overspending.
• Full control: With no outside investment or stakeholders to please, you can shape your business how you see fit.
• Proves your idea has real customers: Test your concept with customers early to help refine your offering and validate market demand.
• Fast decision-making: Quickly pivot to meet changing market demands without the red tape of larger organizations.
• Potentially makes future funding easier: You take the time to prove your business model and profitability before seeking funding. Your track record reduces investor and lender risk and can lead to better funding terms.

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• 6 steps to start a new business from scratch

For this article, we will focus on the steps that take you from a budding business idea to generating sales. 

For additional resources, check out our starting a business guide .

1. Start with an idea

Do some self-reflection and choose an idea you’re passionate about or one that uses your existing skills and experience. 

This will make it far easier to execute and often requires less research, training, and upfront investment to get up and running than an idea completely new to you.

For example, service-based businesses, like accounting or consulting, often need just your time and expertise. If any cash is needed, it should be a small enough amount to fund yourself, giving you full control over the speed at which you grow your business.

As you explore possible ideas, create a one-page business plan to document how it could work. 

It doesn’t have to be an official plan at this stage; just fill in what you can, mark any assumptions, and keep adding details throughout the rest of this process.

What businesses can you typically start from scratch?

While not an exhaustive list, here are a few potential ideas that can be started from scratch:

• Freelance Writing or Content Creation: Offer writing skills to businesses and online publications.
• Consulting Services: Share your professional management, marketing, or tech expertise.
• Handmade Crafts and Art: Sell your unique creations on platforms like Etsy or at local fairs.
• Tutoring: Offer either in-person or online.
• Web Design and Development: Build websites for small businesses or individuals.
• Virtual Assistant: Provide administrative support to businesses remotely.
• Landscaping and Gardening Services: Turn your love of plants into a business with basic gardening tools.

For more business options and a process to generate ideas, check out our guide on developing good business ideas .

2. Find product-market fit

Landing on an idea is not enough to create a viable business. You need to determine if you have initial product-market fit—that your business satisfies and is demanded by a large enough group of people. 

This involves identifying your potential customers, understanding their motivations and needs, and determining whether they are willing to pay for your product or service. Additionally, spend time researching the market and understand who your competitors are. 

At this stage, you don’t need a fully fleshed-out business. You just need enough of an idea to start speaking to potential customers.  

This is where your one-page plan can be incredibly useful, as it helps you formalize enough information to have the working framework of a business. You can even add notes from your customer interviews to help adapt your plan.

Your goal, in this instance, is to:

• Hone in on pain points your potential customers have
• Verify that you can solve them
• Identify any gaps or issues with your idea
• (Bonus) Make initial sales 

Keep in mind that you may find none of that. Your solution may not be needed or is missing key components. You may even be targeting the wrong audience and need to change course.

That’s completely okay! Most businesses don’t get things right the first time. Be willing to refine and iterate on your initial idea. Verify what works and what doesn’t, and make the right adjustments to create a sustainable business that customers really want.

3. Examine your resources

While I have this as the third step, you’ll likely be doing this throughout every stage of starting a business.

Start by evaluating your funding sources. Personal savings are ideal as they keep you in full control of your business. If needed, consider asking friends and family for small contributions, as they’ll likely be much more flexible about repayment than traditional lenders.

Next, consider if a partner could benefit your venture. Do they bring complementary skills, share the workload, or offer additional resources? 

The right partner can fill crucial roles – like marketing or operations – allowing you to focus on your core strengths. They may even fill a necessary gap to get customers in the door.

Finally, don’t underestimate the power of your network. Reach out to former colleagues, industry peers, and mentors for advice, services, or referrals.

Why you need to know your available resources

Taking stock of your resources is the first step in understanding what is feasible for your business. It helps you determine whether you have enough cash, expertise, and support to meet your customers’ expectations.

For example, let’s say you want to launch an eCommerce website and have enough cash on hand to fulfill orders but require customers to pay for shipping. If you’re competing with similar businesses that offer free shipping, your lack of it could turn customers away.

Similarly, you have a solid understanding of product development and have already gotten pre-orders. But you have no idea how to set up an eCommerce site , keep track of orders, and ensure they actually ship.

In both circumstances, your resources fall short of the needs of your customers. You may have to explore funding ( it doesn’t have to be a loan ) and find a partner with the right skill set to get your site up and running. 

4. Write a business plan and develop financial forecasts

At this point, you need to finalize your business plan and create initial forecasts . 

If you’ve been using the one-page plan throughout the last few steps, then this shouldn’t be a time-consuming process. Your goal at this point is to clearly define:

• Business Model: Value proposition, customer segments, distribution channels, and revenue streams.
• Milestones: Set realistic goals (landing your first customer, scaling, etc.) with specific timelines and action steps to track progress.

For your forecasts, start by estimating your:

• Startup costs and ongoing expenses
• Revenue in the first year of operation
• Cash flow — how much money will be moving in and out of your business each month as you collect revenue and pay expenses

These numbers do not have to be perfect. You’ll likely be making educated guesses or using industry estimates. The point is to have something that you believe represents your business. It will help you maintain a healthy cash flow and understand what it will take to be profitable.

Remember, you don’t need to create an overly lengthy plan or complex financial statements. They’re your tools, so focus on usability – they should be flexible and evolve with your business, helping you make informed decisions.

Dedicate time ( at least monthly or quarterly) to reviewing and updating your plan and forecasts as you gather data to ensure your strategy aligns with real-world performance.

5. Protect your business

As a business owner, you must make your business legal and guard against liabilities. To keep things simple, we’ll assume you’re starting as a sole proprietorship for this article.

Check out our full guide to learn more about the specifics of each legal structure .

Necessary legal components for a simple startup:

• Business Registration: As a sole proprietor, you may not need to register your business with the state government if you do business under your legal name. However, if you operate under a name that’s not yours, you must file for a “Doing Business As” (DBA) name. This is often required to set up a business bank account.
• Licenses & Permits: Research local requirements for your specific business type. You may need a general business license, professional licenses, or specific permits (e.g., health and safety). Contact your city or county business office for details.
• Tax Registration: Report business income on your personal tax return. If you plan to hire employees, you’ll need to apply for an Employer Identification Number (EIN) from the IRS. Even without employees, an EIN can protect your personal information and may streamline certain business transactions. Check if you need to register for state sales tax collections.
• Insurance : Consider general liability insurance for accidents and negligence claims. Get professional liability (errors and omissions) insurance if you offer professional services.
• Contracts: Use written agreements for business partners and supplier or contractor transactions. This clarifies expectations, prevents disputes, and protects both parties. Contact a lawyer to review or help you write this documentation if needed.

6. Promote and run your business

At this point, you just need to run your business. You don’t need to go all in, either. Launch it as a side hustle until you hit the point where it can become your full-time focus.

Don’t overcomplicate it: Set up a simple website, payment system, and essential operational tools. You want to serve customers immediately and learn from real-world experience.

But unless you locked in pre-orders earlier in this process, you’ll need to market your business to do it. 

Select marketing channels you believe will reach your target customers. Start small — you want to avoid overspending while you determine the right mix of marketing tactics. If you’re unsure where to start, paid social media ads (Facebook and Instagram), email campaigns, and local partnerships can be inexpensive options.

Stick to the budget you created, run small, easily measured marketing tests, and look for a positive return on investment (i.e., bringing in more revenue from sales than you spent on advertising). 

Only consider increasing spending after you start bringing in customers.

• Continue to review and revise

You are on your way to running a sustainable business and may even have your first customers already! 

Just don’t get too far ahead of yourself. You’re still proving that there is traction that can be repeated with multiple customers. 

As you operate, review your plan and forecasts. Pay close attention to your cash flow and be willing to pivot if things aren’t working. 

That’s the benefit of starting from scratch: You are in full control and can scale and spend at a pace that improves your chances of success.

If you haven’t yet, download a free one-page business plan template to document your idea. The earlier you begin developing the plan, the more useful it will be throughout the startup process.

Kody Wirth is a content writer and SEO specialist for Palo Alto Software—the creator's of Bplans and LivePlan. He has 3+ years experience covering small business topics and runs a part-time content writing service in his spare time.

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How to Start a Business: A Startup Guide for Entrepreneurs [Template]

Published: February 15, 2024

I started a local HVAC business in the summer of 2020, and since then, I’ve learned a lot about which steps are most important for getting a business venture off the ground. To help you make your business idea a reality, I've put together a complete guide that walks you through the steps of starting a business.

The guide covers every step I’ve discovered you need to start a business, from the paperwork and finances to creating your business plan and growing your business online. At the bottom, you’ll find a library of the best free tools and resources to start selling and marketing your products and services.

Use the links below to navigate to each section of the guide:

• What do you need to start a business?

How to Start a Business

How to make a business plan, how to decide on a company name.

• How to Choose a Business Structure

How to Register Your Business

How to comply with legal requirements, how to find funding for your new business, how to create a brand identity for your new business, tips for starting a business, resources to start a business, how to start a business online.

Let's get started.

Every budding entrepreneur wants more visitors, more qualified leads, and more revenue. But starting a business isn’t one of those “if you build it, they will come” situations. So much of getting a startup off the ground has to do with timing, planning, and the market, so consider if the economic conditions are right to start a company and whether you can successfully penetrate the market with your solution.

In order to build and run a successful company , you’ll also need to create and fine-tune a business plan, assess your finances, complete all the legal paperwork, pick your partners, research apps for startup growth, choose the best tools and systems to help you get your marketing and sales off the ground … and a whole lot more.

When I first started my business, I felt overwhelmed by the sheer magnitude of requirements, which is why I’ve summed up the process to make it easier for you.

In brief, the requirements for starting a business are:

• A business plan.
• A business name.
• An ownership or business structure.
• A business registration certificate.
• A legal license or seller’s permit (as well as other legal documents).
• A source of funding.
• A brand identity.

Without these elements in place, you unnecessarily risk your new business’s future. Now let’s go over these basic steps for starting a business.

• Write a business plan.
• Choose a business name.
• Choose an ownership structure.
• Register your business.
• Review and comply with legal requirements.
• Apply for funding.
• Create a brand identity.

Having a great business idea is only part of the journey. In order to be successful, you’ll need to take a few steps to get it off the ground. In order to refine your business idea and set yourself up for success, consider doing the following:

1. Write a business plan.

Your business plan maps out the details of your business, including how it’s structured, what product or service you’ll sell, and how you’ll be selling it. Creating a business plan will help you find any obstacles on the horizon before you jump into running a business.

Pro tip: Remember that part of a business plan is telling investors or funders which specific items you need funding for. Be sure to list what you need to be funded, the reasoning behind items, and how long you will need funding.

Recommended Reading:

• What is a Business Plan? Definition, Tips, and Templates
• How to Build a Detailed Business Plan That Stands Out
• How to Write an Ecommerce Business Plan
• How to Become an Entrepreneur With No Money or Experience

70 Small Business Ideas for Anyone Who Wants to Run Their Own Business

Jump to: How to Start a Business Plan →

Featured Resource: Free Business Plan Template

Below are the key elements in a business plan template, details about what goes into each of them, and example sections at the bottom. You’ll also learn tips for writing a business plan .

1. Use a business plan template .

The executive summary should be about a page long. It should cover:

• Overview . Briefly explain what the company is, where you’ll be located, what you’ll sell, and who you’ll sell to.
• Company profile. Briefly explain the business structure, who owns it, what prior experience/skills they’ll bring to the table, and who the first hires might be.
• Products or services . Briefly explain what you’ll sell.
• The market. Briefly explain your main findings from your market analysis and product market fit .
• Financial considerations . Briefly explain how you plan to fund the business and what your financial projections are.

Featured Resource: Executive Summary Template

On the marketing side, you’ll want to cover answers to questions like:

• How do you plan to penetrate the market?
• How will you grow your business?
• Which channels will you focus on for distribution?
• How will you communicate with your customers?

Pro tip: Marketing trends change year after year, so be sure to keep up on the latest trends by subscribing to the Hubspot Marketing blog .

On the sales side, you’ll need to cover answers to questions like:

• What’s your sales strategy ?
• What will your sales team look like, and how do you plan to grow it over time?
• How do you plan to scale for growth ?
• How many sales calls will you need to make to make a sale?
• What’s the average price per sale?

Speaking of average price per sale, you’ll want to go into your pricing strategy as well.

Featured Resource: Marketing & Sales Alignment Template

More importantly, it typically doesn’t entail giving partial ownership of the business away. Instead, it’s a way of getting funding not from potential co-owners, but from potential fans and customers who want to support the business idea, but not necessarily own it.

What you give donors in exchange is entirely up to you — and typically, people will come away with early access to a product, or a special version of a product, or a meet-and-greet with the founders.

Pro tip: Choose the right platform for your crowdfunding campaign type. Some platforms are more geared towards traditional investors, while others are for donations. Learn more about crowdfunding here .

5. Venture Capital Financing

Only a very small percentage of businesses are either fit for venture capital or have access to it. All the other methods described earlier are available to the vast majority of new businesses.

If you’re looking for a significant amount of money to start your company and can prove you can quickly grow its value, then venture capital financing is probably the right move for you.

Venture capital financing usually means one or more venture capital firms make large investments in your company in exchange for preferred stock of the company — but, in addition to getting that preferred return as they would in series seed financing, venture capital investors also usually get governance rights, like a seat on the Board of Directors or approval rights on certain transactions.

VC financing typically occurs when a company can demonstrate a significant business opportunity to quickly grow the value of the company but requires significant capital to do so.

Pro tip: A lot of venture capital financing is simply being in the right room with the right people. Make sure to network extensively if this is your approach to financing.

When you’re first starting a business, you’ll need to build the foundation for a strong brand identity. Your brand identity is about your values, how you communicate concepts, and which emotions you want your customers to feel when they interact with your business. Having a consistent brand identity to promote your business will make you look more professional and help you attract new customers.

Here’s what you need to do to develop your brand identity:

1. Design a logo.

Creating the right logo for your business requires careful thought and consideration. It should be representative of your brand’s purpose and target audience, while also being memorable and distinct from competitors.

To start, you need a deep understanding of your business’s mission, values, and target audience. Think beyond what your company does and truly examine why you do what you do and who you do it for. This knowledge will serve as the foundation for your logo.

Conducting market research and identifying current logo trends can help you understand what works well for others and strategize on how to stand out. Then, start brainstorming design ideas that showcase what makes your business unique.

For instance, you could try writing out a list of words that best describe your business and what makes it special and then use those words as inspiration to start sketching ideas and concepts.

Once you have some sketches created, pick which ones you think are the best and share them with stakeholders, colleagues, and buyer personas to gather feedback and refine your design. After narrowing down a design, you’ll want to test its versatility and scalability to ensure it works well in different sizes and formats.

Pro tip: Check out this blog on designing your logo, and then try out different logo design features in Canva’s logo maker .

2. Develop a visual identity.

Your brand’s visual identity doesn’t stop at creating a logo — you’ll also need to establish guidelines for typography, color palette, imagery, and other graphic elements. The more consistent your brand is with its visuals, the more consumers will be able to recognize and trust it.

To get started, consider creating a brand mood board. Ask yourself: What kind of emotions do you want your brand to evoke? Is there a specific visual aesthetic that you want to emulate? This can help you gather visual inspiration that resonates with your brand.

Choose your color palette and typography wisely. Spend some time researching color theory , as color can have a major impact on how people perceive your brand. Make sure your typography is readable and looks good across different sizes and formats.

Additionally, you should create other visual assets such as patterns, shapes, illustrations, and icons that pair well with your color palette and typography.

Pro tip: If design and color palettes aren’t your thing, consider hiring a freelance graphic designer on LinkedIn or Fiverr to help you create your visual identity and incorporate it into your logo and overall design.

3. Craft a tagline.

In just a few words, your tagline should encapsulate your brand’s essence and communicate its value. Think of it as a written or verbal version of your logo. Both elements are created to immediately capture the attention of your audience. Even if consumers don’t remember anything about your product or service, they will remember a catchy tagline.

When crafting your tagline, keep it simple. You want your tagline to be memorable, so aim for a short phrase and focus on key benefits or unique aspects of your brand. Also consider using techniques like alliteration, rhyme, or play on words to make your tagline stand out — just make sure it aligns with the rest of your brand’s voice and tone.

Pro tip: This is another element of starting a business that could benefit from someone with experience. A marketing consultant or a content writer could help you establish a compelling tagline with the next step of developing your voice and tone.

4. Develop your voice and tone.

Your brand voice refers to the personality that your brand adopts in its communication with its audience. It provides direction on what to say and how to say it, allowing you to differentiate yourself and cut through the noise.

A well-defined brand voice helps create a distinct and memorable identity for your brand, allowing you to connect with your target audience on a deeper and more meaningful level.

When determining the appropriate voice and tone for your brand, remember that consistency is key. Ensure that your brand voice and tone align with your brand’s values, mission, and positioning. Alignment between your brand’s personality and its communication style is crucial for building trust and authenticity.

Pro tip: Adapt your voice and tone to suit the preferences and understanding of your audience. Additionally, use emotion and storytelling techniques to engage your audience and resonate with them.

5. Create brand guidelines.

Once you determine all of the previously mentioned brand elements, establish a set of brand guidelines that communicate how to appropriately use them. Having these rules and standards set in place ensures consistent and cohesive messaging and representation for your brand.

Get started by defining the rules for using your brand elements across different channels and applications, such as digital and print media, social media profiles, web design, packaging, and any other relevant materials.

Show practical examples of correct and incorrect usage scenarios to demonstrate the do’s and don’ts of brand representation. This helps stakeholders and users understand the guidelines and their application. You can also offer your team templates or mock-ups to ensure correct implementation.

Once the brand guidelines are set, distribute them to internal stakeholders and relevant external partners. To make sure everyone’s on the same page, take the time to review the guidelines with everyone and consider conducting training sessions if necessary.

As your brand evolves, so should your brand guidelines. Continuously review and update them to reflect any changes or refinements. Keep the guidelines easily accessible and communicate any updates effectively.

Pro tip: A writing style guide is a great place to start when creating brand guidelines. Check out this blog on brand style guide examples.

Starting a business online is a little different from starting a traditional business. Here are some important steps for starting and scaling your business online.

1. Determine your niche and business idea.

Your business niche is the target focus area for your product or service. It’s important to choose a niche because customers like brands and businesses that specifically cater to their needs. Most customers are more likely to purchase products or services from a brand that provides personalized experiences.

When determining your niche and business idea, first identify your target audience and specify everything from their age to their interests. Then, use that information to figure out their principal need. If your product doesn’t resolve a specific need, your business will fail to get off the ground.

Pro tip: You should have a good idea of the market at this point. Use that knowledge to position yourself in a way that differentiates you from your competitors.

2. Conduct market research.

Conduct market research to understand what product or service you should offer, whom you should serve, and where you face the stiffest competition. From physical goods to digital downloads, understanding your target market and competitors will help you determine how to best position your product.

Your research should help you create a strong selling proposition . In other words, what makes your business unique? Why should someone buy from you?

Pro tip: Sometimes, market research is as easy as calling around to competitors and getting a quote on services. Make sure your pricing is competitive but not so low as to be unsustainable.

3. Learn online business laws.

While online businesses may require fewer licenses and permits than traditional businesses, there are still legal requirements that you will need to adhere to. Be sure to check:

• What kind of business license (if any) do you need to start operations?
• What legal structure makes the most sense for your company?
• Are there any permits that you need to obtain?
• Are there any inspections that you need to pass?
• Do you need a sales tax license?
• Are there any specific regulations applicable to online businesses only?
• What are the laws regarding hiring contractors and hiring employees?

Pro tip: Check out this article for more information on starting an online business and navigating online laws.

4 . Make sure your business is insured.

Depending on your business type, you may be required by state law to be both licensed and insured. HVAC businesses have a lot of liability as they involve both plumbing and electricity. I spoke with several insurance agents before deciding on the best insurance for my business needs.

There are also many different business insurance types, such as:

• Liability insurance.
• Worker’s comp.
• Property insurance (think your business location, tools, and equipment you use).
• And more. Be sure to research these different insurance types and purchase the necessary ones.

Pro tip: Check out this article on small business insurance.

5. Create a website.

After handling the research, taking care of legalities, and honing your products or services, it is time to create your website . When creating your website, you will need to choose a strong ecommerce platform that will allow you to sell products online.

Pro tip: Check out Hubspot’s free CMS tool for website building here.

6. Set up shop.

Once your website is complete, it’s time to add products or services to your store. When adding your products, pay attention to product images and descriptions. Having a crisp image and a detailed but concise description will help your audience maneuver your website smoothly.

After you have finished setting up your store, it’s critical to ensure you offer a seamless shipping or delivery experience to your buyers. For example, you can use HubSpot to manage quality control before you ship products out.

Finally, you want to make sure everything is working before you hit the live button on your website. Make sure that everything is clickable and that all pages look good across all devices and browsers. Once you’ve checked that, you are ready to go live.

Pro tip: If you take credit card information on your website, you will need to abide by compliance laws that ensure the safety of sensitive data. Read more on credit card compliance .

7. Create a marketing plan.

You’ve created an awesome product, and now it’s time to get the word out. In other words, it’s time to grow your audience. There are numerous ways to reach your target customer, including:

• Social media : Use hashtags and paid ads to expand your reach.
• Influencer marketing : Send free samples to “celebrities” in your niche.
• Facebook groups : Connect with your target market on this platform.
• Google advertising : Put your products in front of people all over the web.
• Content marketing : Publish blog posts to bring organic traffic to your site.
• Word-of-mouth : Encourage customers to spread the word.
• YouTube videos : Start a channel to showcase your products.

Pro Tip: Google ads and LinkedIn ads regularly offer discounts or free ad money; consider using these promos to try online advertisements out.

8 . Grow your business.

You’ve heard it said that in business, you’re either growing or you’re dying. Here are a couple of tips for growing your business online:

• Reduce the amount of time it takes online viewers to receive value from you and your brand.
• Answer the questions no one in your industry is answering — for example, a lot of companies won’t talk about pricing, forcing customers to keep looking for someone who will.
• Create a dynamic website that changes with the times. Update your images and writing to reflect what’s happening with your business now, and ensure your website isn’t dating you.
• Invest in content and SEO . They aren’t cheap, but they are really important for being found online, organically.

Pro tip: Check out this blog on how to become an SEO expert, according to HubSpot’s SEO team.

9. Watch your income and expenditures closely.

The first year of your business is an essential set point for discovering your overhead and your profit. Have a date in mind of when you want your business to start turning a profit and a solid plan for if you aren’t meeting that goal. Read further on potential exit strategies below.

Pro tip: Use a free business budget template to monitor your finances.

10. Plan for an exit strategy.

If you’re like me, you didn’t consider an exit strategy when thinking up your business. You probably assumed you’d run your business for the foreseeable future. However, economic uncertainty or unexpected success can both impact the end of your business. In fact, 90% of startups fail , which makes it a wise choice to know under what circumstances you would close down your business.

You could also experience unexpected buzz and success and be offered a buyout. A good exit strategy will plan for this as well. What amount of money would make selling worth it? Consider also how long you would have to run your business before considering offers. Some want to sell high and fast, whereas other business owners want to see where things go during a set amount of time.

An exit strategy could also include who you want to inherit your business, maybe family or an employee.

Pro tip: Check out this blog on the importance of having an exit strategy.

Next Steps: Getting Ready to Launch Your Business

I know from experience that being a small business owner isn’t easy, but with the right plan, you can set up your business for success. Be sure to check and know your requirements, have a solid business plan, and submit your legal paperwork before you take your business live. Once you have a solid business plan and the financing to execute your goals, you’ll be well on the path to launching a successful enterprise.

Editor’s note: This post was originally published in August 2019 and has been updated for comprehensiveness.

Don't forget to share this post!

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How to build a successful business from scratch

Starting a business from scratch? Let's dive into the exciting world of entrepreneurship and explore the secrets to building a successful business. In this guide, we'll uncover the key steps, strategies, and real-life examples that will empower you to turn your business dreams into reality. Get ready to embark on a thrilling journey of innovation, challenges, and growth as we unlock the secrets to building a successful business from scratch.

Jul 10, 2023

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Starting a business from scratch is an exhilarating and challenging endeavor. The journey of building a successful business requires dedication, perseverance, and a strategic approach. In this article, we will delve into the importance of building a successful business from scratch, explore key factors that contribute to its success, and provide a comprehensive guide to help you navigate the exciting world of entrepreneurship.

Importance of building a successful business from scratch

Building a successful business from scratch holds numerous advantages and benefits. Firstly, it allows you to bring your unique vision to life and create something truly meaningful. By starting from the ground up, you have the opportunity to shape your business according to your values, goals, and aspirations.

Secondly, building a business from scratch enables you to establish a strong foundation. You have the freedom to meticulously plan and execute your strategies, ensuring that every aspect aligns with your long-term objectives. This level of control allows for a more agile and adaptable business model, which can be crucial in an ever-evolving marketplace.

Additionally, starting a business from scratch cultivates a deep sense of accomplishment and personal growth. The challenges you face along the way provide valuable lessons and opportunities for self-improvement. The skills and knowledge acquired during this process can be carried forward into future endeavors, contributing to your overall professional development.

Key factors for building a successful business

Vision and Strategy: Every successful business begins with a clear vision. Define your purpose, identify your target audience, and envision the impact you aim to make. Formulate a well-thought-out strategy that outlines your goals, objectives, and the steps required to achieve them.

Market Research and Analysis: Conduct thorough market research to understand the demand, competition, and potential opportunities. Identify gaps in the market and tailor your product or service to meet the needs and desires of your target audience.

Strong Value Proposition: Develop a unique value proposition that sets you apart from competitors. Clearly communicate the value your business offers to customers and articulate how it solves their problems or fulfills their desires.

Effective Marketing and Branding: Craft a compelling brand identity that resonates with your target audience. Implement marketing strategies that effectively communicate your brand's message and build awareness. Utilize various channels such as social media, content marketing, and public relations to reach your target market.

Customer Focus and Experience: Prioritize customer satisfaction and provide exceptional experiences. Understand your customers' pain points, listen to their feedback, and continually improve your product or service based on their needs.

Financial Management: Develop a sound financial plan and monitor your cash flow diligently. Seek professional advice when needed and ensure your business remains financially stable and sustainable in the long run.

Team Building and Leadership: Surround yourself with a talented and dedicated team. Cultivate a positive work culture, empower your employees, and foster open communication. Effective leadership plays a vital role in inspiring and guiding your team towards success.

Adaptability and Innovation: Embrace change and be willing to adapt to evolving market conditions. Encourage innovation within your organization and continuously seek ways to improve and stay ahead of the competition.

Overview of the article's structure

In the following sections, we will explore each of these key factors in depth, providing practical insights and real-life examples. By the end of this article, you will have a comprehensive understanding of what it takes to build a successful business from scratch and the tools necessary to embark on your entrepreneurial journey.

Now, let's dive into the first key factor: Vision and Strategy.

Understanding the foundations of a successful business

Defining your vision and mission.

Building a successful business starts with a strong vision and mission. Your vision statement outlines the long-term aspirations and purpose of your business, while the mission statement focuses on the practical steps and values that guide your daily operations.

Crafting a clear and compelling vision statement

A well-crafted vision statement serves as a beacon, guiding your business towards its desired future. It should encapsulate your core beliefs, aspirations, and the impact you strive to make in the world. A compelling vision statement inspires both your team and your customers, creating a shared sense of purpose.

For example, the vision statement of a sustainable clothing brand could be: "To create a world where fashion is sustainable, ethical, and accessible to all, inspiring positive change in the industry and beyond."

Establishing a mission statement for guiding business operations

While the vision statement focuses on the long-term, the mission statement provides a roadmap for daily operations. It clarifies the values, goals, and strategies that drive your business forward. A well-defined mission statement helps align your team, informs decision-making, and ensures consistency in your actions.

For instance, a mission statement for a tech startup could be: "To empower businesses with innovative and user-centric software solutions, simplifying complex processes and enhancing productivity, while fostering a culture of collaboration and continuous improvement."

Identifying target market and customer persona

Understanding your target market and creating a detailed customer persona are essential steps in building a successful business. By identifying your ideal customers, you can tailor your products, services, and marketing efforts to meet their specific needs and preferences.

Conducting market research to understand customer needs and preferences

Thorough market research provides valuable insights into your industry, competitors, and most importantly, your customers. It helps you understand their pain points, desires, and purchasing behavior. By analyzing market trends, consumer data, and feedback, you can uncover opportunities and adapt your offerings accordingly.

For example, a restaurant owner may conduct market research to identify the types of cuisine preferred in the local area, assess the competition, and gather feedback on dining experiences to improve their menu and service.

Developing an ideal customer persona for effective targeting

Creating an ideal customer persona allows you to visualize and understand your target audience on a deeper level. It involves defining demographic information, preferences, behaviors, and motivations of your ideal customers. This persona serves as a reference point for all your marketing and communication strategies.

As an example, a fitness app targeting busy professionals might create a customer persona named "Active Alex," a 35-year-old working professional who values convenience, seeks quick and effective workout routines, and is motivated by tracking progress and achieving fitness goals.

Understanding the foundations of a successful business, including a clear vision and mission, as well as identifying your target market and customer persona, sets the stage for strategic decision-making and effective business growth. In the next section, we will explore the importance of developing a strong value proposition and effective marketing strategies to differentiate your business in the marketplace.

Developing a solid business plan

A well-crafted business plan is a crucial tool for building a successful business. It serves as a roadmap that outlines your goals, strategies, and financial projections, while also providing a comprehensive overview of your company. In this section, we will explore the key steps involved in developing a solid business plan.

Conducting a feasibility analysis

Before diving into the details of your business plan, it is essential to conduct a feasibility analysis. This analysis helps you assess the viability and potential success of your business idea.

Assessing market demand and competitive landscape

Start by evaluating the market demand for your product or service. Identify your target market and analyze the size, growth potential, and trends within the industry. Determine if there is a gap in the market that your business can fill and evaluate the level of competition you may face.

For example, if you plan to open a bakery, you would research the demand for baked goods in your area, examine the competition from other bakeries, and identify any niche opportunities, such as catering to gluten-free or vegan customers.

Evaluating financial viability and resource requirements

Assessing the financial viability of your business is crucial for its long-term sustainability. Estimate the initial and ongoing costs of operating your business, including expenses such as equipment, inventory, marketing, and personnel. Conduct a financial analysis to determine if your business can generate sufficient revenue to cover these costs and eventually yield a profit.

Consider the resources you will need to start and grow your business. Determine if you have access to the necessary capital, equipment, and expertise. If not, explore options such as loans, partnerships, or seeking external investors to secure the resources required.

Creating a comprehensive business plan

Once you have completed the feasibility analysis, it's time to create a comprehensive business plan that outlines the key components of your venture.

1. Executive summary

The executive summary provides an overview of your business plan and highlights the key points. It should capture the essence of your business idea, market opportunity, competitive advantage, and financial projections. Although it appears at the beginning of your plan, it is often written last to ensure it accurately reflects the content of the entire document.

2. Company description

The company description provides an in-depth look at your business. It includes details such as the legal structure, mission and vision statements, core values, location, and history. Describe your unique selling proposition (USP) and the value your business offers to customers.

3. Products/services offered

In this section, outline the products or services your business will offer. Describe their features, benefits, and how they meet the needs of your target market. Explain any proprietary technology or intellectual property associated with your offerings.

4. Market analysis and strategy

Conduct a comprehensive analysis of your target market. Define your target audience, identify their needs, and analyze their buying behavior. Assess the size and growth potential of your market segment and outline your market penetration strategy, pricing strategy, and marketing channels.

5. Organizational structure and management team

Detail the organizational structure of your business and the roles and responsibilities of key team members. Highlight their relevant experience, expertise, and qualifications. Additionally, discuss any strategic partnerships or external advisors that contribute to the strength of your management team.

6. Marketing and sales plan

Outline your marketing and sales strategies to reach your target market effectively. Define your brand positioning, messaging, and promotional tactics. Include your online and offline marketing channels, social media strategies, and customer acquisition plans.

7. Financial projections and funding requirements

Provide detailed financial projections, including income statements, cash flow statements, and balance sheets. Project revenue, expenses, and profitability over the next three to five years. Additionally, outline your funding requirements, including how much capital you need to start and operate your business, and how you plan to secure it.

Developing a solid business plan is a critical step towards building a successful business. It helps you clarify your objectives, understand the market landscape, and secure the resources needed for growth. In the next section, we will explore the importance of building a strong brand identity and implementing effective marketing strategies to position your business for success.

Implementing effective marketing and sales strategies

Implementing effective marketing and sales strategies is essential for reaching your target audience, generating leads, and driving business growth. In this section, we will explore key tactics to build brand identity and awareness, establish a robust online presence, and implement targeted marketing campaigns.

Building brand identity and awareness

Building a strong brand identity is crucial for standing out in a competitive marketplace and creating a lasting impression on your target audience.

Crafting a memorable brand name and logo

Choose a brand name that is memorable, reflects your values, and resonates with your target market. Ensure that it is unique and available for trademark registration. Design a professional and visually appealing logo that captures the essence of your brand. Your brand name and logo will become the foundation of your brand identity.

Developing a consistent brand message

Craft a consistent brand message that conveys your unique value proposition and resonates with your target audience. Clearly articulate what sets your business apart and how it solves their problems or fulfills their desires. Ensure this message is reflected in all your marketing materials, communication channels, and customer interactions.

Creating a robust online presence

In today's digital age, having a strong online presence is vital for business success. It enables you to reach a wider audience, engage with potential customers, and establish credibility.

Website development and optimization

Develop a user-friendly and visually appealing website that represents your brand effectively. Optimize your website for search engines to improve its visibility in search results. Ensure your website provides relevant and valuable content, is mobile-responsive, and offers a seamless user experience. Incorporate clear calls-to-action to guide visitors towards desired actions.

Social media marketing and engagement

Utilize social media platforms to connect with your target audience, build brand awareness, and foster engagement. Identify the platforms most relevant to your audience and create engaging and shareable content. Regularly interact with your followers, respond to their comments and messages, and participate in relevant industry conversations. Leverage social media advertising to amplify your reach and target specific demographics.

C. Implementing targeted marketing campaigns

Targeted marketing campaigns enable you to reach the right audience with the right message at the right time, maximizing your marketing efforts and driving results.

Utilizing digital advertising channels (e.g., PPC, SEM)

Utilize pay-per-click (PPC) and search engine marketing (SEM) techniques to reach potential customers actively searching for products or services in your industry. Develop targeted ad campaigns on platforms like Google Ads, Bing Ads, or social media advertising platforms. Conduct keyword research, optimize ad copy, and monitor and adjust campaigns to maximize conversions.

Leveraging content marketing to educate and engage

Content marketing is a powerful tool for establishing thought leadership, educating your audience, and building trust. Create valuable and informative content such as blog posts, articles, videos, and infographics that address the pain points and interests of your target market. Distribute this content through your website , social media channels, email newsletters, and other relevant platforms.

Implementing effective marketing and sales strategies helps position your business for success by creating brand awareness, engaging with your target audience, and driving customer acquisition. In the next section, we will explore the importance of delivering exceptional customer experiences and cultivating long-term customer relationships.

Real-life examples: successful companies built from scratch

Examining real-life examples of successful companies that were built from scratch provides valuable insights into the strategies, challenges, and lessons learned along the entrepreneurial journey. Let's explore three inspiring case studies: Nike, Under Armour, and Starbucks.

Case study 1: Nike

Overview of the company's background and journey.

Nike, founded in 1964 as Blue Ribbon Sports, has become one of the world's leading athletic footwear and apparel brands. Phil Knight and Bill Bowerman started the company with a vision to create innovative products that enhance athletic performance. From humble beginnings, Nike grew steadily by focusing on product quality and targeting athletes across various sports.

Key strategies and tactics employed for success

Nike's success can be attributed to several key strategies. The company invested heavily in research and development to create cutting-edge sports performance products. Nike also forged strong partnerships with top athletes, leveraging their star power and endorsements to build brand credibility and awareness. Additionally, Nike adopted aggressive marketing campaigns that resonated with its target audience, employing slogans like "Just Do It" to inspire and motivate consumers.

Lessons learned and insights for aspiring entrepreneurs

Nike's journey teaches us the importance of innovation, quality, and building strong brand partnerships. By consistently pushing the boundaries of product development, Nike established itself as a leader in the athletic industry. Collaborating with renowned athletes and utilizing influential marketing campaigns helped create an emotional connection with consumers. Aspiring entrepreneurs can learn from Nike's commitment to excellence, customer-centric approach, and effective branding strategies.

Case study 2: Under Armour

Introduction to the company's unique value proposition.

Under Armour, founded in 1996 by Kevin Plank, revolutionized the athletic apparel industry with its moisture-wicking fabric technology. Plank identified a need for performance-enhancing apparel that effectively regulated body temperature during physical activity. Under Armour's innovative fabric and focus on athletic performance resonated with athletes, positioning the brand as a trusted name in the industry.

Marketing and sales approaches that drove growth

Under Armour employed targeted marketing campaigns that emphasized its technological advantage and appealed to athletes' desire for peak performance. The brand sponsored professional athletes and teams, gaining credibility and exposure. In addition, Under Armour leveraged digital marketing channels and social media platforms to engage directly with its target audience. The brand's authentic and aspirational messaging created a strong emotional connection with athletes.

Challenges faced and strategies for overcoming them

One of the challenges Under Armour faced was competition from established athletic brands. To overcome this, the company focused on product differentiation and continuous innovation. Under Armour expanded its product line beyond apparel, venturing into footwear and connected fitness devices. By diversifying its offerings and staying ahead of trends, Under Armour maintained a competitive edge.

Case study 3: Starbucks

The founder's entrepreneurial journey and motivation.

Starbucks, founded by Jerry Baldwin, Gordon Bowker, and Zev Siegl in 1971, started as a single coffee shop in Seattle. Inspired by the rich coffee culture of Italy, the founders aimed to create a community gathering place that served high-quality, freshly roasted coffee. Their vision was to provide customers with an inviting ambiance and a personalized coffee experience.

Innovative business model and disruptive strategies

Starbucks introduced several innovative strategies that contributed to its success. The company pioneered the concept of the "third place," positioning its stores as a comfortable environment for customers to relax, work, and socialize. Starbucks also focused on direct trade relationships with coffee growers, ensuring the sourcing of ethically and sustainably grown coffee. The introduction of the Starbucks Rewards program and mobile ordering further enhanced the customer experience.

Scaling up and maintaining success in competitive markets

As Starbucks expanded globally, it faced challenges of maintaining consistency while adapting to diverse markets. The company invested in employee training programs to ensure consistent customer service and product quality worldwide. Starbucks also embraced digital technologies, leveraging mobile payments and personalized marketing campaigns to enhance customer engagement and loyalty.

These case studies of Nike, Under Armour, and Starbucks demonstrate the importance of innovation, customer-centric approaches, and strategic marketing in building successful businesses from scratch. Aspiring entrepreneurs can draw inspiration from these companies' journeys and apply valuable insights to their own ventures.

As we conclude our exploration of building a successful business from scratch, let's recap the key steps, provide encouragement and motivation for aspiring entrepreneurs, and reflect on the final thoughts and takeaways from real-life examples.

Recap of the key steps for building a successful business from scratch

Throughout this article, we have discussed several key steps for building a successful business from scratch. These steps include:

Defining a clear vision and mission for your business.

Conducting thorough market research to understand customer needs and preferences.

Developing a solid business plan that outlines your strategies and financial projections.

Implementing effective marketing and sales strategies to build brand awareness and reach your target audience.

Overcoming challenges and seeking funding options to support your business growth.

Cultivating the essential qualities and skills of a successful entrepreneur.

By following these steps and adapting them to your unique business idea and circumstances, you can lay a strong foundation for success.

Encouragement and motivation for aspiring entrepreneurs

To all the aspiring entrepreneurs reading this, remember that building a business from scratch is a journey filled with ups and downs. Embrace the challenges, view failures as opportunities for learning and growth, and stay committed to your vision. Surround yourself with a supportive network, seek advice from mentors, and never stop learning.

Entrepreneurship requires resilience, passion, and a willingness to step outside your comfort zone. Celebrate the small victories along the way, stay focused on your goals, and keep pushing forward. Remember, every successful business started with an idea and a determined entrepreneur like yourself.

Final thoughts and takeaways from real-life examples

As we examined real-life examples such as Nike, Under Armour, and Starbucks, we gained valuable insights into the strategies, challenges, and successes of these iconic brands. These companies emphasize the importance of innovation, customer-centricity, and adaptability.

We learned that building a successful business requires continuous learning, embracing change, and staying attuned to the needs and preferences of your target audience. It is crucial to build a strong brand identity, establish a robust online presence, and implement effective marketing strategies. Furthermore, the journeys of these companies remind us that entrepreneurship is a long-term commitment, and success often comes from perseverance, hard work, and maintaining a customer-focused approach.

As you embark on your entrepreneurial journey, draw inspiration from these real-life examples, but also remember that your path will be unique. Embrace your own story, learn from failures and successes, and continue to adapt and innovate.

In conclusion, building a successful business from scratch is a rewarding and transformative experience. By following the key steps, staying motivated, and learning from real-life examples, you can navigate the challenges and create a thriving business. Believe in yourself, trust the process, and keep your entrepreneurial spirit alive.

Best of luck on your journey of building a successful business from scratch!

Frequently asked questions (FAQs)

As aspiring entrepreneurs embark on the journey of building a business from scratch, they often have questions about the challenges they may face, the importance of market research, available funding options, the timeline for success, and the essential qualities of a successful entrepreneur. Here are the answers to some frequently asked questions:

What are the common challenges entrepreneurs face when building a business from scratch?

Building a business from scratch comes with its own set of challenges. Common hurdles include:

Limited resources: Entrepreneurs often face constraints in terms of finances, manpower, and infrastructure.

Market competition: Competing against established players and differentiating oneself in a crowded marketplace can be challenging.

Uncertainty and risk: The entrepreneurial journey involves navigating through uncertainties and taking calculated risks.

Time management : Balancing various aspects of business operations while striving for growth can be demanding.

Building a competent team: Recruiting and retaining talented individuals who align with the vision of the business can be a hurdle.

How important is market research in the early stages of starting a business?

Market research is crucial in the early stages of starting a business. It helps entrepreneurs gain valuable insights into customer needs, preferences, and market trends. By conducting thorough market research, entrepreneurs can:

Identify target customers and understand their pain points, allowing them to tailor their products or services accordingly.

Evaluate market demand, competition, and potential opportunities for differentiation.

Make informed decisions about pricing, positioning, and marketing strategies.

Validate the feasibility and viability of their business idea, minimizing risks associated with entering an unproven market.

What funding options are available for entrepreneurs with limited resources?

Entrepreneurs with limited resources have several funding options to explore, including:

Bootstrapping: Using personal savings, revenue generated from the business, or funds from friends and family to self-finance the business.

Small business loans: Applying for loans from banks or financial institutions specifically designed for small businesses.

Angel investors: Seeking investment from individuals who provide capital and expertise in exchange for equity.

Venture capital: Pursuing funding from venture capital firms that invest in high-growth potential startups.

Crowdfunding: Utilizing online platforms to raise funds from a large number of individuals who believe in the business idea.

How long does it typically take to build a successful business from scratch?

The time it takes to build a successful business from scratch varies depending on various factors, including the industry, the nature of the business, market conditions, and the entrepreneur's strategies and execution. Building a successful business is a long-term endeavor that requires dedication, persistence, and continuous adaptation. Some businesses may experience rapid growth, while others may take several years to establish themselves. Patience, perseverance, and a focus on long-term goals are essential during the entrepreneurial journey.

What are the key qualities and skills needed to be a successful entrepreneur?

Successful entrepreneurs possess a combination of key qualities and skills, including:

Passion and self-motivation: Having a genuine passion for the business idea and the drive to overcome challenges and stay motivated.

Resilience and adaptability: Being able to bounce back from failures, adapt to changing circumstances, and learn from setbacks.

Vision and creativity: Having a clear vision for the business and the ability to think creatively and innovate.

Risk-taking and decision-making: Being comfortable with taking calculated risks and making informed decisions under uncertainty.

Leadership and communication: Effectively leading and inspiring a team, while also being able to communicate ideas, vision, and strategies.

Persistence and perseverance: Demonstrating perseverance in the face of obstacles and the ability to keep pushing forward.

These qualities and skills can be developed and refined through experience, learning, and a commitment to personal and professional growth.

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Business plan template

If you’re looking for a way to start your business off on the right foot, a business plan template can help you establish the foundation for your strategy. Get started in a few clicks with Asana’s free business plan template.

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You’re pumped—you just thought of the greatest business idea ever. You want to get started, but you don’t have a plan laid out. You need a loan to get your idea off the ground, and the bank wants to see an in-depth business plan. We’re here to help.

What is a business plan template?

A business plan template is a framework that helps you solidify your ideas in an organized format. Our free business plan template walks you through how to create a new business from scratch, or re-imagine your existing business in a new market.

What components are included in a business plan template?

Our business plan template covers what an organization wants to achieve within three to five years. By using our template, you’ll have a place to capture all of the major information you need in order to complete your business plan. That includes:

Company description : Information like your executive summary , your company’s mission statement and vision, and your founder’s bio. 

Product and services: A high-level overview of what your company provides, including core products or services. This may also include how your product is developed, any potential screenshots or prototypes of your product, and pricing plans.

Marketing plan: How you plan to bring your product into market at a high level. You can add information like a SWOT analysis , target market research, and brand positioning in this section.

Financial plan: Important financial information such as balance sheets, a break-even analysis, and your cash flow projections. 

Management and organization information: Information on your company’s founders, executive team, and the board of directors.

How to use our free business plan template

Using Asana’s free business plan template is simple. Start by creating a new project with our free template. From there, add relevant information for your specific business plan in the sections provided in our template. If there’s more information you want to include in your business plan, you’re free to add sections, custom fields, or additional tasks to make this template fit your needs.

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Reporting . Reporting in Asana translates project data into visual charts and digestible graphs. By reporting on work where work lives, you can reduce duplicative work and cut down on unnecessary app switching. And, because all of your team’s work is already in Asana, you can pull data from any project or team to get an accurate picture of what’s happening in one place.

Milestones . Milestones represent important project checkpoints. By setting milestones throughout your project, you can let your team members and project stakeholders know how you’re pacing towards your goal. Use milestones as a chance to celebrate the little wins on the path towards the big project goal. 

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How do I create a business plan template? .css-i4fobf{-webkit-transition:-webkit-transform 200ms ease-in-out;transition:transform 200ms ease-in-out;-webkit-transform:rotateZ(0);-moz-transform:rotateZ(0);-ms-transform:rotateZ(0);transform:rotateZ(0);}

Instead of taking the time to create a business plan from scratch, start the process off with Asana’s free template.To further customize your template, add evergreen information about your specific business, such as your business model, company name, address, mission statement, value proposition, or target audience. Adding these details to your template lets you avoid documenting this information from scratch every time you create a new business plan.

What components should I include in a business plan template?

Business plan templates typically contain five main sections: a company description, products and services, a marketing plan, basic management and organization information, and your current financial plan.

How long should my business plan be?

Short answer—as long as you need it to be. The long answer is that your business plan should have the answers to specific questions on how your business is run, from the perspective of an investor. The goal of a business plan is to highlight your business strategy for the next three to five years. This means any important operational, financial, and strategic information should be included. 

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Writing an Effective One-Page Business Plan: What You Need to Know (+ Free Template)

By Homebase Team

If you’ve started—or are starting—a small business, you’ve probably heard the words ‘business plan’ thrown around. That’s because a business plan is an important document with important information! Even a one-page business plan can help you address key questions early in the planning process.

That’s right—we said  one page. In many cases, there’s no need for a supermassive document that takes ages to create. In this article, we walk you through what a good business plan needs—and what a business plan one-pager should contain. 

Whether you’re writing your business plan for the first time or giving your existing plan a refresh, we’ve got your back. We’ve even got a free, downloadable business plan template to help you get started. Let’s get into it!

Why do you need a business plan?

A business plan is a blueprint for your business. It outlines everything your business needs, from goals to market to the steps you need to implement.

Business plans serve two main purposes:

• To help you set your business up for success. As you put together your business plan, you’ll be forced to think strategically about all your business goals and activities . Are they realistic? Is something likely to go wrong? What haven’t you thought of? The goal is for you to walk away feeling confident in the future of your business.
• To communicate the value of your business to others. It’s rare that entrepreneurs like yourself will go it 100% alone. You’ll likely work with partners, investors, or vendors to bring your small business to life. A business plan gives your collaborators confidence in you and your business and helps them support you in the best way possible.

Taking the time to create a business plan can feel like you’re wasting all-too-precious time, but it can help keep you focused and increase efficiency down the road. It’ll also help you make better business decisions off the bat so you can grow your small business quickly and wisely. 

What are the 7 main points in a business plan?

Every business plan is unique, which is part of the reason writing one can feel a tad overwhelming. You can’t just copy and paste the plan from another business—instead, you need to assess your business’s idea within its niche.

Luckily, the skeleton of every plan is usually very similar. Whether you’re creating a plan for a neighborhood daycare or that cool new bar down the street , here are a few main points to put into any comprehensive business plan.

1. Executive summary

Your executive summary is an overview of your business plan. 

Think about this section like a TL;DR or too long, don’t read . If someone wants to understand the gist of your business plan in just a few minutes, what information would they need to know?

2. Company overview and description

In this section, you should introduce your business to the reader. By the time they finish reading this section, they should have a good idea of who you are, what you do, and what you sell—in other words, your business’s niche.

Don’t be afraid to dive into your own background and why you decided to start this business. Building a small business is personal, and your story can go a long way in giving the reader some context.

3. Market and competitive analysis

Every business needs customers. Here’s where you’ll detail who they are and the potential target market of your business, including your ideal customer.

You’ll also want to take note of potential competitors that may impact your business. These might be direct competitors, but could also be similar businesses that may compete for your customers’ time and money. For example, if you’re opening a cycling studio, you might consider any other type of fitness studio to be a competitor.

Competition isn’t a bad thing, but being aware of your competition is one way to ensure your business stands out from the crowd. 

4. Business offerings

Here’s where you’ll outline what products or services your business will offer in more detail. It doesn’t have to be a complete laundry list, but it should give readers a general idea and show a certain degree of forethought and attention to details.

For example, if you’re opening a bakery , this might be a sample of your menu. Or if you’re an HVAC repair company , you might share an overview of the services you’ll offer your customers. This section might even mention the products or services you won’t offer and why, especially if it helps clarify how your business is unique.

5. Management and operational plan

From managing employees and inventory to securing equipment and a lease, there’s a lot that happens behind the scenes to keep things running smoothly. Every business plan should touch on how you’ll manage the day-to-day of your business.

This is also a great place to indicate key milestones and timelines so you know that you’re on track for a successful grand opening. 

6. Sales, marketing, and PR strategy

Now that you’ve got all the research and operational plans in place , it’s time to start attracting customers and securing those sales. Even with the best products or services in town, every business can use a little marketing boost. Feel free to get creative. From social media to paid ads, there are tons of ways you can spread the word about your budding business . 

7. Financial forecast and budget

No one loves to crunch financials, but when it comes to business, money talks. And a strong financial plan is key to the long-term success of your business.

This final section of your business plan should estimate the costs, revenue, and profits of your business in the short and long term. How do you plan to finance your business? What costs will you incur before opening day ? What are the ongoing costs?

Not only will this give your vendors and investors confidence in your business, but it helps you make sure that your business is profitable in the long run.

What is a one-page business plan?

A one-page business plan is essentially a condensed version of a full business plan.  

It covers all the core information about your business without overwhelming the reader with details. The goal is to summarize your business plan for yourself and potential stakeholders so they can understand your business at a glance.

Depending on your business needs, this concise document may even be all you need to get your business off the ground. Or it could serve as a stepping stone to a more robust plan in the future. 

Top benefits of a one-page business plan.

Bigger isn’t always better—and one-page business plans are here to prove it.

Here are some benefits and reasons why you might opt for a one-page business plan:

• To kickstart your business planning: A full business plan can be incredibly daunting. A one-page business plan gives you a place to start without feeling overwhelmed with the nitty gritty. 
• To share and distribute: Sometimes potential vendors, partners, or investors want to get more information about your business before they sign on officially. Instead of leaving them with a massive document, a one-page business plan helps you share the relevant need-to-know information easily.
• To focus on the key details: If you’re early on in the business ideation process and want to make sure you have all the important information, a one-page business plan can help you easily validate your business plan.
• To save time: In the long term, you may still expect to put together a full business plan at some point. However, if you’re in a time crunch, a one-page plan can help you get the important insights without the time commitment.
• To easily edit: In an ever-changing business environment, a one-page business plan is much easier to keep updated. 

Key details to include in a one-page business plan.

Above, we outlined the key components of any business plan. The key with a one-pager is to keep it brief without losing any of those important details. 

Let’s look at the sections of a business plan one-pager and dig into how you can adapt them to cover all the details of your business—all on one page. 

Summary and overview

Start your one-page plan by sharing the name of your business, what you do, and your main value proposition.

The problem—and your solution

In a few sentences, share the problem that your business solves and how you solve it. This clarifies why your business should exist, so it’s an important section!

Depending on your business, you may also want to share a few of your team members to help readers put a face to your business. Great examples include the executive chef for a restaurant, or the lead veterinarian for your vet clinic.

Target market

Briefly describe who you expect to be a customer and their characteristics. This could be in the form of a short “ideal customer” profile.

Competitor overview

Here, you’ll touch on potential competitors and what makes your business stand out.

Business timeline

Share the key milestones for your business. For example, pitch when you’ll start marketing your business, when you’ll hire employees , and when you expect to open.

Sales and marketing plan

Here, you’ll quickly highlight the key marketing activities that you’ll use to drive new customers to your business. Try to stick to the most interesting or high-value stuff, like a website or social media .

Financial projections

Outline your expected revenue , expenses, and profits to give the reader an idea of your financial future.

Our tips for creating a one-page business plan.

If you’ve ever written something with a limited word count, you know that sometimes keeping things concise can be easier said than done.

As you get writing your one-page business plan, here are some of our top tips so you can make the most of that one page.

• Focus on the need-to-know information.
• Avoid fluff and keep your sentences short.
• Link out to additional resources and material if more information is necessary.
• Don’t be afraid to strategically incorporate visuals to emphasize the important points.
• Feel free to up sections or have different versions of your one-page business plan based on who’s reading it. 
• Get creative with formatting to keep information organized.

One-page business plan example.

If you’re skeptical that all that information can fit on one page—we have proof!  Here’s an example that you can use to start thinking about your business plan.

Download our free one-page business plan template.

A one-page business plan is one of the most important pages you’ll write for your business. While there’s a lot to think about, it’s worth the effort to give both you and your partners peace of mind.

The good news is that we’ve done the heavy lifting for you! If the above one-pager looks good to you, we’ve pulled it together as a download for you. All that’s left for you to customize it for your unique business, fill in the sections, and get ready to launch your business.

Download your one-page business plan template PDF

Get your team in sync with our easy-to-use, all-in-one employee app.

One-page business plan FAQs

Why should you create a business plan.

There are several reasons you should create a business plan, such as:

• Improving your decision-making as you start and grow your business.
• Setting realistic goals and timelines.
• Attracting top-notch suppliers, investors, and even employees.
• Keeping your business profitable and your financials in order.

What types of companies need a business plan?

From brand-new small businesses to established corporations, companies of all shapes and sizes need a business plan. It’s a key part of setting your business up for success and improving your business trajectory.

Even if you already have a business plan in place, revisiting it from time to time can help you stay on track with your goals and adapt as your business changes.

Can a business plan be one page?

Yes, in many cases a business page can be one page. The trick to creating an effective one-page business plan is making sure that you’re covering the most important pieces of information. 

Our top tips? Keep it as concise and organized as possible, so you can effectively communicate the value of your business to your audience.

Writing a one-page business plan is simple. You can create a business plan from scratch or use a free template like the one above to stay on track, but generally, the steps to writing a one-page business plan include:

• Start with a short executive summary and value proposition to introduce your business.
• Share the problem your business solves and your solution.
• Give an outline of top competitors and how your business compares.
• Create a timeline of key milestones.
• Outline your sales and marketing plan for attracting customers.
• Summarize your financial projections and funding plans.

Remember:  This is not legal advice. If you have questions about your particular situation, please consult a lawyer, CPA, or other appropriate professional advisor or agency.

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How To Write A Business Plan From Scratch

Writing a business plan for the first time can be daunting and confusing. Why should I write one? Where do I even start? How will this improve the success of my business?

In this article, we answer all of these questions in a step by step guide on how to write your first business plan from scratch.

Should I Write a Business Plan?

There seems to be a debate on whether or not a business plan is relevant. Many of today’s biggest companies started without one . This leads many people to believe that it isn’t useful, let alone necessary for success.

However, a recent study examined 11,046 small businesses and looked at the correlation between their success and whether or not they had a business plan. The study concluded that companies that used a business plan grew 30% faster than their counterparts.

Having a plan also can also assist with organization and consistency. By having a plan written out, it allows an entrepreneur to refer back to the outline and make sure everything in their business is operating efficiently, and as expected.

Business Plan Composition

The first step in writing a successful business plan is deciding its structure. For the sake of simplicity, we’ll stick to a 5-page business plan template. The composition of this 5-section template will be broken down into:

Competitive Analysis

In this section, you’re essentially providing a general breakdown of your business. This can begin with simple details such as the business name, location, legal structure, and a description of what the business does. If you’re creating a plan for an existing company, it will likely have sales, return on investments and all other financial information.

A mission statement is also usually included in this section. The best mission statements include the company’s values, vision, and mission. Furthermore, the statement should be clear, concise, and easy for the reader to understand.

The company’s structure of responsibility should be mapped out in this section as well. This should outline who’s in charge of the sales, marketing, and finance areas of a company for instance.

While it’s the first thing that people will read, we generally advise that you write the overview last. Why? Because once you know the details of your business inside and out, you will be better prepared to write your overview.

You want to start by describing the industry you’re competing in and the markets you’re targeting. It is crucial for all business owners to be up-to-date with their industry. This can include familiarity with industry trends, innovations, and shifts or even  supporting your IT needs . Once we know this, we can identify what our competitive advantage is. A competitive advantage is any strategy that puts a company in a favorable business position over its competitors.

In this section, you want to describe as much about your competitors, supplier and buyer powers, and external threats. This can all be scoped through traditional industry analysis.

If you’d like to learn more about how to perform an industry analysis, check out our guide on how to use Porter’s Five Forces. Porter’s Five Forces is a powerful tool, created by Harvard Business School professor Michael Porter. It was designed to understand the competitiveness of a business environment. This enables us to better identify profitable opportunities. 

This section provides information about the products or services your company provides. A good start would be to explain what problem your product solves, and how it accomplishes this. If you can’t pinpoint a problem that your product solves, then you might not have a viable business concept.

Additionally, this section should include information about the products:

• manufacturing cost
• pricing strategy
• supplier/ source
• consumer demand

To begin, a good business plan will identify the target market segments. This is then followed with data to indicate how fast each segment is growing. When identifying target markets, a classic method is to use the TAM, SAM, and SOM breakdown.

• TAM:  Total Available Market (everyone you wish to reach with your product)
• SAM:  Segment Addressable Market (the section of TAM you will target)
• SOM:  Share Of the Market (the portion of your SAM that you will realistically reach—particularly in the first few years of business)

Once you have identified your key market segments, you should discuss the trends for these markets. Are they growing or shrinking? Identify the market’s evolving needs, tastes, or upcoming changes.

Another important question to address in this section is how you plan to build customer loyalty. A great marketing strategy should aim to build consumer interest and retain customers.

Finally, the last section when you write a business plan should be the company’s goals. This can be broken into two sections of goals: short term (1-year) and long term (3-5years).

Each section should aim to describe goals in respects to:

• company development
• company impact

It’s important to note that this is solely the minimum of goals a business should set. It’s very likely for a company to have goals not measured by numbers. If they’re significant to the company, they should also be added to this section for a more detailed comparison in the future. 

You should also set up a bank account to have a vision of your business’s financial standing, track your  online payments , and identify the area that is least beneficial to your business. This way, you can avoid business failure.

The power of this section lies in manifesting the direction you want your company to head in. A popular study by Psychology professor Dr. Gail Matthews, revealed you’re 42% more likely to achieve your goals if you write them down.

Key Takeaways

Creating a business plan can serve many purposes alongside increasing a company’s likelihood of success. There are many ways to build strong business plan templates , however most consist of an Overview, Competitive Analysis, Product Description, Marketing Plan, and List of Company Goals. The more detailed each of the sections of the business plan is the more accurately you can achieve your goals and grow your company. Hopefully, after having read this guide, you now have a more concrete understanding of how to write a strong business plan.

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8 Steps to Start a Small Business From Scratch Starting a business feels more manageable when you follow a straightforward, step-by-step process.

By Joseph Ferriolo Edited by Amanda Breen Aug 24, 2021

Opinions expressed by Entrepreneur contributors are their own.

We do amazing, meaningful things every day, but in small increments. We build a life, a family, a career, a worldview, a legacy — all in bite-sized pieces that are manageable in the moment, yet impactful in the long term.

This feeling that the challenge of starting a business is too big is a primary obstacle many entrepreneurs see blocking their road to financial independence. And yet, the basic process of building a business can be as step-by-step as starting your coffee pot in the morning or driving to work.

Turn things on, get in gear, find a starting point and go.

That's not to say that it's easy or that there's no work involved. But when creating a small business, a series of steps becomes manageable instead of a neverending staircase you have to run up.

Related: Low Cost Business Ideas, How to Start a Small Business

In the spirit of taking things one productive piece at a time, here are the eight steps we recommend for starting your own small business.

1. Get a strategic business plan

A business plan is the living structure of your company. It creates a pathway for success and lays out strategies for revenue, marketing, hiring, profit margins, competition and competitive advantages. You'll also use your plan to share your vision with potential investors, bank-loan officers and even new company managers and branding experts.

2. Incorporate your company

The business formation process can be contracted out to professionals or handled piece-by-piece as you go along. If you work with a company that offers this kind of service, it can also handle many of the tasks in the following steps for you. Unless you plan to work as a sole proprietorship, which has different rules and can often be managed the same way as freelance work, you'll want to create an LLC or limited liability corporation. You can learn more about which business structure to choose on the Small Business Administration's website.

3. Get a Tax ID number

In most instances, a small-business owner will need to file for a Taxpayer Identification Number (TIN), which the Internal Revenue Service (IRS) uses to administrate tax laws. It is issued either by the Social Security Administration (SSA) or by the IRS. According to IRS.gov, a tax ID number is not required if you operate a sole proprietorship or an LLC with no employees. However, if you plan to have employees, you will need to get an Employer Identification Number (EIN) that they can use for filing taxes. An EIN can be applied for online if your business is located in the United States or U.S. Territories, and you'll first need to have a TIN to apply for an EIN.

4. Get a business license

Your business licensing requirements may differ depending on the city, state or county in which you are doing business and the kind and size of business you plan to start. For example, in some states, sole proprietors do not need to acquire a business license (though certain companies and services have individual licensing and permit requirements). This is one of the kinds of services a business-formation company can assist you with or even handle on your company's behalf.

5. Create a brand

Branding is about more than a clean, eye-catching logo and a standard set of colors you use for things like product packaging, business cards and your website. Those things are vitally important — and often overlooked — but the tone of the words in your marketing materials and how your images, graphics and products make customers or clients feel is also a part of your branding. Decide what the emotional resonance of your company should be and then use that to inform all your branding choices. Once you've decided on a look and feel, stick with it. Consistency of messaging is vital to brand awareness.

Related: 9 Strategies to Boost Small-Business Profitability

6. Build a website

A good business website is more than just due diligence for business owners in 2021. It's essentially a fundamental part of the business creation process, and it is nearly impossible to do effective business without one, much less reach your growth and sales potentials. Contract with a reputable full-service company, work with a talented freelancer or even create a simple yet effective landing-style homepage yourself; whatever it takes, get a web presence up and running by the time you're ready to launch.

7. Get a business bank account

This may seem like an extra step when you're in the thick of business planning, but choosing a bank that goes the extra mile for small businesses is vital to your success. Look for dedicated business checking accounts with low or no fees, small starting deposits, ATM accessibility in your area, interest-earning accounts and online or mobile banking tools geared toward making small-business processes easier.

8. Plan and execute a digital-marketing strategy

Digital is the name of the game now; it's not a trend or something new everyone is looking to get into. Digital marketing, whether it's finding an influencer to partner with or creating just the right voice for social, is going to play a central role in how you get the word out about your business. Look for social-media-marketing managers who are agile and able to keep up with the ever-changing social world. Chances are, they'll be able to handle any other digital-marketing needs you have and even suggest new channels for growing your customer base.

Owning a business is a lifelong project, and small-business owners put their hearts and souls into their companies day in and day out. But taking that leap into entrepreneurship doesn't really have to be, well, a leap.

Related: 5 Things Not to Do When You're Running a Small Business

Director of Wise Business Plans

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Pros and Cons of Writing a Business Plan from Scratch

The business plan is an essential document for strategizing about the steps your business needs to take to reach the next level of success. When you are writing a business plan , you generally have three choices: You can write a business plan from scratch, you can hire a professional to write a plan for you, or you can use business plan software to generate one using computerized templates.

There are pros and cons to each of these methods, but today we’re going to look at some of the advantages and disadvantages of writing a business plan from scratch.

PRO: It’s free

Writing your own business plan from scratch saves you money because you don’t have to pay professional market rates, and you don’t need to purchase special software in order to produce your business plan. Depending on the size of your business and the complexity of your business plan, this can be significant savings, especially over professional rates.

PRO: Personalize your plan with industry insight

When you write your own plan, you can draw on your own years of experience to tailor it to your specific situation and the industry insight that you have gained as a leader in your field. No one knows your business and your place in your industry better than you, so you can use yourself as your own best resource.

PRO: Intimate understanding of your plan

You will never know a business plan better than when you are intimately involved with it at every level. As you work through all of the financial statements, charts, graphs, and research, you will develop a deeper knowledge of your business and its position than you could ever gain from reading someone else’s work. This can be especially beneficial if you need to present your plan to investors or to a bank and will have to be able to talk in knowledgeable detail about everything contained in it.

CON: You get what you pay for

Because you are writing the plan yourself, you are limited by your own available time and expertise in developing your plan. As the old saying goes, you don’t know what you don’t know. When you hire experts or use paid software, you receive some guarantees of accountability and that the information in the plan will be presented correctly, with calculations that are accurate. If you are developing your own business plan, you won’t have a guarantee that charts are correct, data are accurate, and calculations are done right. If you make a mistake, there is no one to catch it buy you.

CON: It’s a lot more work

At every step of the plan-writing process, you will need to do all of the work yourself. That means that you can’t simply drag and drop numbers in a computer to generate financial statements, graphs, and charts for you. Instead, you will need to create these essential documents yourself. You will also need to format the whole business plan, complete with pagination, headings, etc. While this might seem easy enough if you are comfortable with desktop publishing software, it can be exceptionally time-consuming, even for desktop publishing pros, when you need to merge different types of documents, integrate spreadsheets, or use complex pagination or formatting styles.

CON: It’s more difficult to keep your plan up-to-date

Plans created by software can be updated with the click of a mouse, while those produced by experts can rely on those experts to do the updating for you, for a fee. When you create your own plan, you have to update it yourself, and you need to ensure that any updates and changes are carried through consistently from the beginning of the plan to the end, which can be a lot of extra work.

The path you choose for your business plan will depend on a number of factors, but before choosing to go it alone, be sure that you are comfortable with the different tools and datasets you will need to complete your business plan. If you have any concerns or doubts about the process, you might be better off using business plan software or even hiring someone professional to help write your own business plan for you.

Ultimately, a business plan serves as a key document for your company’s future, so it’s important to put in the time and the effort to do it right the first time to ensure that your company’s future remains bright.

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Building A Business From Scratch

Build a successful business from scratch with this comprehensive guide. Learn how to identify a viable business idea, conduct market research, develop a busi...

Building a Business from Scratch: The Road to Entrepreneurial Success

Starting a business from scratch is a thrilling and rewarding endeavor that allows individuals to turn their entrepreneurial dreams into reality. It is an opportunity to create something meaningful, make a difference, and potentially achieve financial independence. However, the journey of building a business from the ground up is no easy feat. It requires careful planning, dedication, and a willingness to overcome challenges along the way.

In this comprehensive guide, we will explore the ins and outs of building a business from scratch. We will delve into the various steps and strategies involved in transforming your idea into a thriving venture. Whether you are a seasoned entrepreneur or just starting your journey, this blog post will provide you with invaluable insights and practical advice to set you on the path to success.

Preparing for Success

Before diving headfirst into building your business, it is crucial to lay a solid foundation for success. This section will guide you through the initial steps of identifying a viable business idea, conducting market research, developing a business plan, and securing the necessary funding.

Identifying your business idea

The first step in building a business from scratch is to identify a unique and viable business idea. We will explore various techniques for brainstorming and evaluating potential ideas, as well as determining their feasibility and market potential.

Conducting market research

Understanding your target audience, competitors, and industry trends is essential for crafting a successful business strategy. We will delve into the importance of market research and provide practical tips on how to gather relevant data and analyze market trends effectively.

Developing a business plan

A well-crafted business plan serves as a roadmap for your entrepreneurial journey. We will discuss the key components of a business plan, including setting goals, outlining strategies, and creating financial projections. You will gain a thorough understanding of how to create a comprehensive business plan that will not only guide you but also attract potential investors or lenders.

Securing funding

Access to capital is often a critical factor in turning your business idea into a reality. We will explore various funding options, from traditional bank loans to seeking investors or bootstrapping your way to success. You will learn how to develop a compelling pitch, navigate the funding landscape, and secure the necessary financial resources to launch your business.

Setting up the Foundation

Once you have a solid plan in place, it's time to establish the foundation of your business. This section will cover essential aspects such as choosing a suitable business structure, registering your business, setting up a physical location, and building a professional team.

Choosing a business structure

Selecting the right business structure is crucial for legal and financial reasons. We will compare different options, including sole proprietorship, partnership, limited liability company (LLC), and corporation, helping you make an informed decision based on your specific needs and goals.

Registering your business

To operate legally, you must register your business with the appropriate authorities. We will outline the necessary steps involved in registering your business, obtaining permits and licenses, and ensuring compliance with local regulations.

Setting up your physical location

Depending on your business model, finding a suitable physical location may be a crucial factor for success. We will guide you through the process of finding and securing office or retail space, negotiating leases, and setting up utilities to create a welcoming and functional workspace.

Building a professional team

No business can thrive without a competent and dedicated team. We will discuss the process of hiring employees, contractors, or outsourcing services, as well as the importance of seeking legal and accounting support to ensure compliance and smooth operations.

As you embark on the journey of building your business from scratch, remember that it is not just about the destination but also the process. Stay tuned for the next sections, where we delve into launching and growing your business, sustaining long-term success, and overcoming challenges on your path to entrepreneurial greatness.

Section 0: Introduction to Building a Business from Scratch

Starting a business from scratch is a bold and ambitious undertaking that requires vision, determination, and a willingness to embrace the unknown. It offers individuals the opportunity to pursue their passions, create their own path, and shape their destiny. Building a business from the ground up is not for the faint of heart, but for those willing to put in the effort, it can lead to immense personal and financial rewards.

In this section, we will delve deeper into the concept of building a business from scratch and explore the reasons why individuals embark on this entrepreneurial journey. We will also address common misconceptions and challenges that aspiring entrepreneurs may face along the way.

The Definition and Significance of Building a Business from Scratch

Building a business from scratch refers to starting a venture without the support of an existing framework or infrastructure. It involves taking an idea, nurturing it, and transforming it into a fully functioning business entity. Unlike acquiring an established business or joining a franchise, starting from scratch allows entrepreneurs to have complete control over their vision, strategies, and operations.

The significance of building a business from scratch lies in the immense opportunities it presents. It allows individuals to pursue their passions, turn their ideas into reality, and create something truly unique. By starting from scratch, entrepreneurs have the freedom to shape their business according to their values, goals, and aspirations.

Passion, Purpose, and Freedom: Why Start from Scratch?

One of the primary reasons individuals choose to build a business from scratch is the desire to pursue their passion. Starting a business allows them to align their work with their interests and create something meaningful. Whether it is a product, service, or mission-driven venture, building from scratch provides a platform to bring their vision to life.

Moreover, building a business from scratch offers a sense of purpose. It allows entrepreneurs to make a difference in their chosen industry or community, solve problems, and contribute to society. By starting from scratch, they have the opportunity to create a business that reflects their values and makes a positive impact.

Another significant motivation is the freedom that comes with building a business from scratch. Entrepreneurs have the autonomy to make decisions, set their own schedules, and create a work environment that aligns with their preferences. They are not bound by the constraints of traditional employment and have the flexibility to shape their own destiny.

Common Misconceptions and Challenges of Building from Scratch

While building a business from scratch offers exciting prospects, it is important to address the common misconceptions and challenges that aspiring entrepreneurs may encounter.

One misconception is the idea of overnight success. In reality, building a business takes time, effort, and perseverance. It often involves facing setbacks, making mistakes, and learning from failures along the way. It is essential to set realistic expectations and understand that success is a result of consistent hard work and dedication.

Another challenge is the uncertainty and risk associated with starting from scratch. Entrepreneurship inherently involves taking calculated risks and stepping outside of one's comfort zone. It requires a willingness to adapt, pivot, and overcome obstacles. Navigating the ups and downs of building a business can be daunting, but with the right mindset and strategies, challenges can be transformed into opportunities.

In conclusion, building a business from scratch is a transformative journey that allows individuals to pursue their passions, create value, and experience personal and financial fulfillment. In the following sections, we will explore the essential steps and strategies involved in turning an idea into a thriving business. From preparing for success to sustaining long-term growth, we will equip you with the knowledge and insights to embark on your entrepreneurial journey.

Building a successful business from scratch requires careful preparation and planning. In this section, we will explore the crucial steps involved in preparing for entrepreneurial success. From identifying a viable business idea to conducting market research, developing a business plan, and securing funding, these foundational steps will set you on the right path towards building a thriving venture.

Identifying your Business Idea

The first step in building a business from scratch is to identify a unique and viable business idea. Inspiration can come from various sources, such as personal experiences, market trends, or identifying gaps in the market. Take the time to brainstorm and evaluate different ideas, considering factors such as market demand, competition, and your own passion and expertise. It's important to choose a business idea that aligns with your interests and has the potential to solve a problem or fulfill a need in the market.

Conducting Market Research

Market research is a critical component of building a successful business. It involves gathering and analyzing information about your target audience, competitors, and industry trends. By understanding the needs, preferences, and behaviors of your potential customers, you can tailor your products or services to meet their demands effectively. Additionally, thorough competitor analysis helps you identify your unique selling proposition and differentiate your business from others in the market. Market research provides valuable insights that lay the foundation for strategic decision-making and market positioning.

Developing a Business Plan

A well-crafted business plan is an essential roadmap for your entrepreneurial journey. It outlines your business goals, strategies, and financial projections. A comprehensive business plan helps you articulate your vision, define your target market, and establish a clear path to success. It also serves as a tool to attract potential investors or lenders who may be interested in supporting your business. Your business plan should include sections on executive summary, company description, market analysis, marketing and sales strategies, organizational structure, financial projections, and more. It is a dynamic document that should be regularly revisited and adjusted as your business evolves.

Securing Funding

Access to capital is often a crucial factor in turning your business idea into reality. There are various funding options available, depending on your business model, industry, and growth plans. You can explore traditional sources such as bank loans, seek investment from angel investors or venture capitalists, or even consider crowdfunding platforms. Bootstrapping, or self-funding, is another option where you use your personal savings or generate revenue from initial sales to fund your business. Whichever funding route you choose, it's important to have a clear understanding of your financial needs, create a compelling business case, and develop a strong pitch to secure the necessary funds.

Preparing for success is a vital phase in building a business from scratch. By carefully identifying your business idea, conducting thorough market research, developing a comprehensive business plan, and securing the right funding, you lay a solid foundation for your entrepreneurial journey. In the next section, we will explore how to set up the foundation of your business, including choosing a suitable business structure, registering your business, establishing a physical location, and building a professional team.

Once you have prepared for success by identifying a viable business idea, conducting market research, developing a business plan, and securing funding, it's time to set up the foundation of your business. This section will guide you through the essential steps involved in establishing a solid base for your venture. From choosing a suitable business structure to registering your business, setting up a physical location, and building a professional team, these foundational elements are crucial for long-term success.

Choosing a Business Structure

Choosing the right business structure is a critical decision that impacts your legal and financial obligations. The most common business structures include sole proprietorship, partnership, limited liability company (LLC), and corporation. Each structure has its own advantages and disadvantages, so it's important to evaluate them based on factors such as liability protection, tax implications, management flexibility, and future growth plans. Consulting with an attorney or a business advisor can help you make an informed decision that aligns with your specific needs and goals.

Registering Your Business

To operate legally and establish your business as a separate legal entity, you need to register it with the appropriate authorities. The registration process varies depending on your location and the type of business structure you have chosen. Typically, you will need to file the necessary paperwork, obtain the required permits and licenses, and pay any applicable fees. Registering your business ensures that you comply with local regulations, protects your intellectual property, and allows you to engage in legal transactions.

Setting up Your Physical Location

Depending on the nature of your business, you may require a physical location such as an office, retail space, or manufacturing facility. Finding the right location is crucial as it can impact your visibility, accessibility, and overall customer experience. Consider factors such as demographics, foot traffic, proximity to suppliers or target market, and rental or lease terms. Negotiating leases, setting up utilities, and ensuring compliance with zoning and building regulations are important steps in establishing a functional and conducive workspace.

Building a Professional Team

No business can thrive without a competent and dedicated team. As you set up the foundation of your business, it's important to hire the right people who align with your company culture, values, and goals. Determine the roles and responsibilities needed to run your business effectively and create job descriptions that clearly outline the qualifications and skills required. You can use various recruitment methods such as job postings, referrals, or partnering with recruitment agencies. Additionally, consider outsourcing certain tasks or services to specialized professionals, such as legal, accounting, or marketing support, to ensure compliance and expertise in critical areas.

By choosing a suitable business structure, registering your business, setting up a physical location, and building a professional team, you establish a solid foundation for your business. These foundational elements will provide the structure and support necessary for your venture to thrive. In the next section, we will explore the crucial steps involved in launching and growing your business, including developing a marketing strategy, building an online presence, and scaling your operations.

Launching and Growing Your Business

With a solid foundation in place, it's time to launch your business and focus on its growth. In this section, we will explore the crucial steps involved in launching your business successfully and driving its growth in the long run. From developing a comprehensive marketing strategy to building an online presence and scaling your operations, these strategies will help you attract customers, increase sales, and expand your business.

Developing a Marketing Strategy

A well-defined marketing strategy is essential for reaching and engaging your target audience. Start by creating a brand identity that resonates with your target market and differentiates your business from competitors. Identify your target audience and develop buyer personas to understand their needs, preferences, and behaviors. With this information, you can create targeted marketing campaigns using a mix of traditional and digital marketing channels such as print ads, social media, email marketing, content marketing, and search engine optimization (SEO). Regularly track and analyze the effectiveness of your marketing efforts to make data-driven decisions and refine your strategies.

Building an Online Presence

In today's digital age, having a strong online presence is crucial for the success of any business. Start by creating a professional website that showcases your products or services, provides valuable information to customers, and makes it easy for them to contact you or make purchases. Optimize your website for search engines to increase visibility and organic traffic. Additionally, leverage social media platforms to engage with your audience, build brand awareness, and drive traffic to your website. Consider creating valuable content such as blog posts, videos, or podcasts to establish yourself as an industry expert and attract a loyal following.

Sales and Customer Acquisition

Effective sales strategies are vital for acquiring customers and driving revenue growth. Develop a sales process that aligns with your target audience and their buying journey. Implement lead generation techniques such as networking, referrals, partnerships, or online lead generation campaigns. Once you generate leads, focus on nurturing them through personalized communication, providing value, and addressing their pain points. Implement a customer relationship management (CRM) system to track interactions, manage customer data, and improve sales efficiency. Continuously analyze and optimize your sales process to maximize conversions and customer satisfaction.

Scaling Your Business

As your business grows, it's important to identify opportunities for scaling and expanding. Explore various growth strategies such as entering new markets, expanding product lines or services, franchising, or strategic partnerships. Conduct market research to identify potential growth areas and ensure they align with your overall business goals. Implement efficient operational processes, leverage technology, and invest in infrastructure to support increased demand. Continuously monitor your financials, cash flow, and profitability to ensure sustainable growth and make informed decisions.

Launching and growing your business is an exciting phase that requires careful planning, strategic marketing, and a focus on customer acquisition and satisfaction. By developing a comprehensive marketing strategy, building an online presence, and scaling your operations, you will position your business for long-term success. In the next section, we will explore the essential strategies for sustaining and thriving in the long run, including financial management, building strong customer relationships, innovating and adapting, and overcoming challenges.

Sustaining and Thriving in the Long Run

Building a business from scratch is not just about the initial launch and growth; it's about sustaining and thriving in the long run. In this section, we will explore the essential strategies that will help you navigate the challenges and uncertainties of entrepreneurship, and ensure the long-term success of your business. From financial management to building strong customer relationships, innovating and adapting, and overcoming challenges, these strategies will help you sustain and thrive in a competitive business landscape.

Financial Management

Effective financial management is crucial for the long-term sustainability and growth of your business. Develop a budget that outlines your revenue and expenses, and regularly monitor and analyze your financial statements. Keep track of your cash flow, manage debt effectively, and ensure you have a solid understanding of your business's financial health. Seek the guidance of a financial advisor or accountant to help you make informed decisions, minimize risks, and optimize your financial strategies.

Building Strong Customer Relationships

Customer relationships are the lifeblood of any business. Cultivating strong relationships with your customers is key to driving customer loyalty, repeat business, and positive word-of-mouth referrals. Focus on providing exceptional customer service, listening to customer feedback, and addressing their concerns promptly. Implement customer relationship management (CRM) systems to track customer interactions, personalize communication, and identify opportunities for upselling or cross-selling. By building strong customer relationships, you not only retain existing customers but also attract new ones through positive testimonials and recommendations.

Innovating and Adapting

Innovation and adaptability are essential for staying ahead of the competition and meeting evolving customer needs. Continuously monitor industry trends, technological advancements, and changes in consumer behavior. Embrace innovation by seeking ways to improve your products, services, or processes. Encourage a culture of creativity and experimentation within your team. Be open to feedback and suggestions from employees, customers, and industry experts. By constantly innovating and adapting, you position your business to be at the forefront of your industry and ensure sustainable growth.

Overcoming Challenges and Risks

Entrepreneurship is not without its challenges and risks. It's important to anticipate and prepare for potential obstacles that may arise along the way. Identify the risks specific to your industry and develop contingency plans to mitigate them. Stay informed about changes in regulations, economic factors, or market conditions that may impact your business. Maintain resilience and a positive mindset when faced with setbacks or failures. Seek support from mentors, industry networks, or business communities to gain insights and learn from the experiences of others who have overcome similar challenges.

Celebrating Success and Future Goals

As you navigate the journey of building a business from scratch, it's important to celebrate your achievements and milestones along the way. Take the time to reflect on your successes, both big and small, and acknowledge the hard work and dedication that went into building your business. Set new goals and aspirations for the future, whether it's expanding into new markets, launching new products, or making a positive impact in your community. Continually challenge yourself and your team to strive for excellence and embrace growth opportunities.

In conclusion, sustaining and thriving in the long run requires effective financial management, building strong customer relationships, embracing innovation, overcoming challenges, and setting ambitious goals. By implementing these strategies, you position your business for long-term success and create a foundation for continued growth. As we wrap up this comprehensive guide on building a business from scratch, remember that entrepreneurship is a journey that requires dedication, resilience, and a passion for turning dreams into reality. Stay inspired, continue learning, and keep pushing forward on your path to entrepreneurial greatness.

Adrian Kennedy

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• Procurement

15 Steps to start a business from scratch with (almost) no money

A step-by-step guide to starting a business, covering everything from coming up with business ideas to business planning, fundraising and more.

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Coming up with a business idea and starting a business can seem overwhelming and complicated. There are so many things you have to consider from coming up with an excellent idea to registering a company , all the way to business planning, fundraising and much more.

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That is why we have put together this in-depth guide to take you by step by step through how you can start a business. It covers every conceivable thing you could want to know when setting up a business, including:

• Know yourself as an entrepreneur before you start
• Generating new business ideas
• Researching the validity of your ideas
• Testing your business premise in the real world
• Creating an initial business plan
• Setting up the right legal structure for your business
• Understanding your financial, accounting and tax obligations
• Protecting your business from a legal and disaster perspective (insurance)
• Creating an identity for your business including building a brand and website
• Get your business essentials sorted including setting up internet and stationary
• Funding options for starting your business including investment, grants, loans and more
• Devising initial marketing and sales strategies
• Building your initial team including recruitment, management and company culture
• Starting your business whilst keeping a full-time job

I highly recommend that if you are new to starting a new business you should read this guide from beginning to end, but if you want to skip ahead, there’s a table of contents below with quick links to sections and subsections.

This guide is designed for UK entrepreneurs but most of it relates to entrepreneurs starting a business anywhere, only the financial and legal sections will differ significantly.

1. Know yourself as an entrepreneur before you start

Starting a business is a process that requires an enormous amount of thought and careful examination. First, you need to take a good look at your strengths , weaknesses and skills. This will allow you to start thinking about what you can do and what you cannot do. It is important to start here even if you already have world’s best business idea, because you might not have the skills or personality traits to enable you to make it into a successful business. You want to come up with business ideas where you are naturally best suited to be successful, for example:

• A person with a decent level of programming skill is well adapted to starting a web development agency.
• A person that has a short attention span might not want to consider accountancy related businesses.
• An person that doesn’t enjoy speaking to new people wouldn’t consider a heavily client facing business.

These are just three general examples, but it gives you an idea of the thought process. The crucial point is to understand yourself and your team, and if you are well suited to any business ideas, areas of business or specific types of business. It allows you to start coming up with ideas and narrowing down what businesses you could start.

Discover your motivation for starting a business

Before you start a business, you should be absolutely clear about why you are doing it. That may sound obvious, but there are actually many reasons why someone should choose to turn their back on the security of a job and career for the uncertainty of starting a business. So the clearer you are about what exactly you are trying to achieve, the better chance you have of achieving it.

Wealth, power, fame, saving the world? Most entrepreneurs are motivated by a mix of the above although most wouldn’t like to admit it. Understanding what is driving you to start a business is a major factor in determining what type of business you should start. Why? Because when a business you start isn’t aligned with personal ambition , it is much more likely you will fail.

You should make sure from the beginning that your personal goals and drive are compatible with your business, for example:

• Someone who seeks wealth might want to look at companies in the financial services industry, where Fintech valuations and revenues are typically much higher than other start-up businesses.
• Someone who seeks power and influence could achieve this through any form of media business.
• Someone who seeks out fame might be best suited to an entertainment related business.
• Someone who wants to save the world might start a business tackling climate change through renewable energy.

It is important to understand why you are starting a business so you can focus on business ideas that will help you get to where you want to go.

Make sure it’s a good reason to start

In reality, you are unlikely to have just one reason for starting a business; it is likely to be a combination of several of them. So be aware that the aims may conflict with each other. Creating a long-term family business to pass down the generations, for example, may well be incompatible with making a serious fortune, because you may find you need to sell the business in order to realise its full worth.

While it is possible to create a successful business solely to make a lot of money , in reality, it will be hard work if there isn’t at least one other factor acting as a motivator. This is because it can take many years between starting a business and receiving any money from it – if ever – and along the way the hard work required is immense, and the possibility of failure is very real.

Simply pinning your hopes on a future possible pot of gold is unlikely to be enough to sustain you through the difficult times. So make sure you have a good reason, work hard and enjoy the ride!

Understand your entrepreneurial passions

When it comes to starting a business, if you are passionate about it, you will be more likely to be successful. The main reason for this is simple: you will work harder and persevere more on a business you are passionate about, thus be more likely to succeed at it. Often the only difference between an entrepreneur who starts a successful business and an entrepreneur who fails is passion.

Logic dictates that if you want a successful business then you should begin in an area that you already have a passion for. To start figuring out what businesses or areas of business you are or could be passionate about start by thinking about the areas, activities, and things you are passionate about , that is, that interest you and you have strong opinions on, for example:

• Someone who loves to hike might consider setting up a travel business.
• Someone who loves Lego might think about a toy or construction business.
• Someone who spent their whole life with a passion for music might start a company related to sound

When thinking of offline or online business ideas keep in mind that starting any business is hard enough, if you make sure it is one you are passionate about you are much more likely to succeed.

Are you the right age to start a business?

Questions such as what is the average age of a startup founder, what is the optimal age to be a founder and is it possible to be too old/ too young to start a startup, are all often asked. The graph from HBR shows the distribution of ages of the founders of billion dollars, venture capital-backed private companies.

It’s an interesting distribution that undeniably favours those between the age of 20-35.  Of course, these $1bn companies are huge outliers and represent a very small dataset of total startups.  Having said that, it’s an interesting graph to note as after all, for those of us that start startups, isn’t this the ultimate dream that we’re all swinging for in the long run?  For those that fall into this age bracket, the signs are good. Even Fred Wilson, prolific New York based Venture Capitalist was quoted as saying that “tech is biased toward the younger generation” as the article notes.

In contrast to the graph above, the Kauffman Foundation conducted a study and released a report entitled “ The Anatomy of an Entrepreneur “. They found the average age of a founder to be 40 years old. Of course, I can think of a number of benefits of waiting until this age to start a company; the most obvious being years of experience under your belt.

Ultimately, age should not be a limiting factor in success. There are pros and cons about certain ages, and some people might have biases one way or the other.  Regarding starting a startup often it is down to the circumstances and thought process of the individual. There will always be reasons to not take the plunge but in reality are these reasons even valid ?

Your age should be way down the list of factors that you consider if you’re thinking of starting a startup.  With startups being the roller coaster that they are, the range of emotions from almighty highs to deep lows experienced by any founder on a day to day basis will dwarf the benefits or negatives caused by the founder’s age. There are many metrics that startup founders can pay attention to at any one point in time.  In my opinion, age should not be one of them.  What’s your opinion?

2. Coming up with great business ideas

Coming up with a business idea is relatively easy, coming up with a great business idea is hard. It is critical to your success that when starting out you explore as many ideas as possible before deciding on the final one you will take forward.

In this section, we will guide you through the process of finding a great business idea that you can turn into a successful, profitable and valuable business.

Start generating business ideas

It is now time to start coming up with ideas, this is often a long and time-consuming process but have some patience and you will bring to life some fantastic ones. Below you will find advice on how to get started in the ideation process and come up with great business ideas!

Solve a problem that prospective customers care about

Start by thinking about what significant problems you could solve and how. Many successful companies started out on a mission to solve real problems that affect millions of people and provide a solution through their products and services.

For example, Tesla started with the objective of making the world’s cars purely electric and they are well on the way having built a hugely successfully multi-billion-dollar business in the process.

Identify where you provide a better solution

Look for areas where solutions are already available but you can do better than existing companies either regarding efficiency, innovation or cost.

For example, Apple entered the mobile phone market more than a decade ago as an underdog with a new innovative product and are now a market leader. Despite the fact the technology had been available for years no one had brought the level of innovation the iPhone did to the market.

Be cheaper than other businesses

You should look for areas where you can provide significant savings to the customer vs competitors. These types of businesses grow incredibly fast, particularly during recessions.

For example, Poundland is a great example of this kind of business, since its inception its used price as the primary differentiator to its competitors. Through offering the lowest price possible on a big range of consumer products the business has grown to a highly successful high street chain.

Innovate in a traditional slow changing market

Is there a field of business or industry that hasn’t seen much innovation in the last 10-100 years? This is often the case in non-tech industries that are slow to push forward change while the status quo remains profitable.

These industries often have tremendous opportunities to disrupt them with new technologies, innovations, systems and methods. For example, only recently has the taxi industry rapidly changed with the introduction of Uber innovating how we find and hire taxis.

Build a business for a future need or market

Try to think into the future, what will the world look like in 5 or 10 years? Thinking about the future will allow you to think about new markets and niches that may open due to innovations and new technologies.

For example, cryptocurrencies such as Bitcoin in the last few years have grown to be significant markets by themselves with a whole eco-system of technology and infrastructure providers developing around it.

Copy other businesses and be better

It is unlikely, unless you are on the forefront of technology, that your business ideas are unique. Plenty of the world’s biggest companies were not revolutionary, yet they came into markets with developed players and just outperformed everyone else.

You do not have to have the most original idea to create a brilliant business, you just have to do it better than anyone else! For example, Microsoft came out of nowhere and beat every other competitor to become the dominant operating system provider in the early 1990’s.

Turn your hobby into a business

A logical jump is to take a hobby and turn it into a real business. Why? A hobby is something you already know a lot about, clearly have a passion for and you will know where to start. For example, it is logical to go from collecting models to selling models.

Think about a global business

The world is now a very global place, you can have a business in China and operate it from New Zealand if that is what you want. Globalization and technology offer immense possibilities to run businesses in new and emerging markets around the world.

If the conditions are not right for your business model in your home country market look for a country where they are. For example, Rocket Internet built their multi-billion-dollar business by copying innovative business models from developed markets and taking them to less developed markets where they were the only company.

Don’t limit yourself to one business idea

It is easy to settle on one idea but to give yourself the best chance of coming up with a great idea it’s best to pick a few to explore and compare.

If you’re stuck, stop thinking

You can overthink it when it comes to ideation, so if you are stuck stop thinking about it . Many times, when you stop actively thinking about something the solution or idea will come to you later.

3. Research your business ideas

This stage is all about researching your business idea as much as possible to decide if your idea or ideas could turn into a great business. To assess and compare each, you want to have a clear understanding of the points below.

Define & analyse your target market

Is there a market for the business, product or service and is it big enough to support your goals ? You should also consider the competitive landscape and know who your main competitors are. Analyse what their and your weaknesses and strengths are, as well as market opportunities and threats. You want a clear idea of the overall market and how your business would fit into it.

See if there’s a demand for your product or service

Is there a direct demand for your goods or will you have to educate customers about the need for your product or service?

Understand your potential customers

You should have a clear idea of who your potential customers are, including demographic data and business details if you are selling B2B.

Have a marketing & sales plan that makes sense

Having a good understanding of how you would reach your potential clients and grow your market share is critical to success. Specifically, understanding what marketing and sales activities and channels will you need to pursue and how.

Make sure your business model will work

Can your business model work given the current market and potential customers? This is often an overlooked point, but many start-ups fail because their business model does not operate.

Find funding for your business

Is it going to cost a significant amount to set up your business? This is a key factor on whether your business could work as it depends on your resources and your ability to raise finance if needed, i.e. Small business grants , business angels , venture capital , invoice finance or bank business loans .

4. Test your business premise

Once you have a few thoroughly researched business ideas it’s time to test quickly and validate if the premise of your proposed business works in the real world. Many entrepreneurs who skip this stage, end up wasting much time chasing ventures that would never work. So now that we have established it is a good move to test your ideas and research, this section explores the different routes to market for testing different ideas.

Be precise when measuring performance

When testing a proposed business, you can assess the performance of any venture in different ways, so it is important to initially work out what you want to measure to gauge success or failure . Here are some suggested measures to get you started:

• How much revenue could you generate/ How many products can you sell?
• How much customer interest can you generate?
• How much press/notoriety can you generate?

Different testing methods

As per the title of this section, you should find and deploy the fastest, cheapest, and most robust way possible of testing your business premises. How you choose to do this largely depends on your business idea, below are some of the most popular methods that fit the above criteria.

Create a landing page and carry out e-mail marketing

If you have services or a specific solution based business and your primary sales channel will be online, this is often the quickest way to test:

• Set up a quick one-page website (for non-technical people Wix is a good solution).
• Make it seem and feel professional (you can get a 5 dollar logo/brand off Fiverr).
• List your services/solutions.
• Add a contact email.
• Find the e-mails of ideal potential buyers and contact them about your service.

Then manage communications and see if anyone is interested, if not ask why and be persistent.

Build an online store and buy adverts

If your idea involves selling products online:

• Create a quick online store (WordPress, Shopify or BigCommerce are good options).
• Add a brand and make everything look professional.
• Add mocked up graphics of your products.
• Add contact details and sort an email.
• Spend £25 on Facebook ads and see how many clicks, sales and how much revenue you can drive.

Set up a market stall and sell

If you are starting a product based business and your primary sales method will be face-to-face, a cost-effective way to test your business is to build initial versions of your product and book a table at your local market or festival.

You can gauge via sales and customer feedback if the premise is a success and gain valuable feedback as to how you could pivot the premise to success if it fails. Innocent Smoothies started by testing their products at a festival before becoming a business (and later being acquired by Coke for hundreds of millions).

Sell over the phone (Telesales)

One of the best ways to get meaningful qualitative feedback is to find the ideal buyer of your product on LinkedIn for example, track down their phone number and call/pitch as much as possible to gather as much feedback and as many pre-orders as you can.

5. Create a business plan

At this point you have chosen the business idea you are going to turn into a business and tested it, now it is time to put together a business plan to outline in detail the objectives of your business and how you are planning to achieve them.

A business plan is a great exercise for sorting out your thoughts and it allows you to plan your business in a structured way, for yourself and so outside parties such as investors or partners can understand what you are trying to achieve and how.

Great planning from the start can be the difference between a business that is successful and well executed and a business that fails . In this section, you will find guidance on how to create a great business plan.

Key elements of a business plan

Your business plan should include many key elements and follow a simple and clear structure. Always aim to create a business plan that anyone could pick up and understand what your business is, what its objectives are and how you are planning to get there; this means breaking it up into clear sections.

Executive summary

An executive summary is an introduction to your plan, its content, and an overview of everything in your business plan. It should provide the reader with a short, concise and clear overview of what your business is and what you are trying to do in no more than two paragraphs.

Contents page

The readers of your plan will often want to skip to specific parts that interest them; a contents page allows them to navigate quickly to the appropriate section.

Business model and products/services

Here you need to outline your business model and what are the products, services and solutions you provide.

Customer, market and competition

In this section, you need to show a clear understanding of your ideal client, the market for your product, service or solution (also have your market clearly segmented ) and an understanding of the competitive landscape, including who your competitors are and where you are in the market in comparison to them.

Marketing and sales

This section is about demonstrating a clear plan from a marketing and sales perspective as to how you intend to achieve your objectives, whether that is scale, revenue generation or some other tactic.

Finances and projections

You want to show your current finances and any projections you have for the business moving forward. Always make sure to be realistic with financial projections , you will have to back them up at some point!

Include a short section about your current team, who they are and their qualifications/experiences. If you have expansion plans for human resources, you should also include them here.

Business plan summary

This section should should showcase the entirety of your business and your business plans , through key points in bullet point format and provide contact details so a reader can easily get in touch with you.

How to write a business plan

Writing a business plan when you are starting out is often a new, complicated and sometimes overwhelming task. There are however some golden rules you should take into consideration when writing that will make your life a lot easier!

Keep your writing short

Make sure to summarise and keep your writing as short as possible as this will help your plan be very clear. It helps you organise your ideas but most importantly, it makes it much easier for external parties to understand.

Make sure everything is relevant

It is very easy and tempting to include irrelevant information in your business plan. This extra information usually makes your communication less efficient and makes the idea harder to understand.

To get rid of any irrelevant material, once you have finished a section do a quick review and get rid of anything that doesn’t support or add to the main point you are trying to make in that section.

Check grammar and spelling thoroughly

If there’s even a chance external parties will at some point read your business plan, then make your spelling and grammar excellent. As with any document, you lose much credibility and sometimes meaning if there are spelling and grammar errors.

Create a simple mission statement

A mission statement should concisely explain what the overall purpose of your business is, for example, the mission could be: to reduce the impact of plastic waste on the environment.

Set clear objectives

Set SMART objectives by being very specific on what you are trying to achieve across the business and in individual areas.

State how you are going to get there

It sounds simple but many entrepreneurs are not very clear about how they are going to achieve their business objectives, make sure you thoroughly think and create a way for your business to get from point A to B.

Use a realistic timeline

Setting a realistic timeline alongside your activities and objectives is a critical factor when composing any business plan.

How to format and present your business plan

Making sure you have created your plan in the appropriate format can be very important to how it is perceived or used. Here are a few tips on how you can achieve the best format.

Business plan formats

Create your initial document in Word, Google docs or Open Office, these tools are easy to use and you’ll end up with an easily editable file. You can also use Excel to create and update a clear structure, this helps to give you a good overview of the plan. Make sure to use a theme that is consistent throughout the document regarding fonts, colours and design features.

If you must give a copy to an external party, always export the file to PDF, and make sure to have professional graphics in place if desired (if you want to design something graphically complex, Adobe InDesign is perfect for this).

How to present your plan

If you are going to make a presentation of your plan, you need to create a PowerPoint/Keynote version. The presentation format will differ from your business plan in that each page should make one key point with a maximum of other three supporting ones.

Make sure to use simple graphics and focus on what you are trying to communicate (remember you can always provide a full business plan at the end of a presentation to any parties).

Keep your business plan updated

Your business plan should be updated as circumstances and objectives change. If your business is now running, it’s impractical to continually update this document but it should be reviewed and kept up to date over time. Apart from anything else it is a good reflection on where you started and where you are now.

If you are looking for a way to track your progress against objectives, it is best to build a tracker/planner on Excel or use tools like Asana or Trello.

Tools for business planning

Usually, Excel, Word or even a whiteboard is sufficient, but if your business is a little more complex or you struggle with organisation, then using a business planning software makes sense. The best and most popular solutions out there are Asana, Trello and LivePlan.

6. Registering a business

The structure you select for your business depends on your specific needs. In this section, we will take you through the various business structures, their advantages, disadvantages and how you can set them up; In most cases most entrepreneurs opt to form a company in the UK (limited).

Different types of business structure

There are several types of legal structures you can choose from when setting up a business, we have detailed them further below.

Sole trader

A sole trader is a business-type where one person owns and runs the entire business. It is the simplest business structure you could adopt. It is very suitable for any one-person businesses; this includes independent accountants, web developers and gardeners among others.

Being a sole trader means the individual is entitled to all/any profits of the business but is also liable for any debt/damages incurred. In the UK, there are currently over 3 million registered sole traders, and the number is growing with a massive influx of skilled freelancers.

Limited company                                               

A limited company is a structure that means a business is a separate entity from its owners. This means the owners are only liable for any business debts to the extent of the amount of money they have put into the business, thus limiting any exposure for business owners beyond their total investment. There are two types of limited companies you can incorporate in the UK. This is similar to an LLC in the United States, but you typically have to fill out a free LLC operating agreement across the pond. The documents you’ll need will depend on which limited company you choose.

Private limited company (LTD or Ltd)

In a private limited company, the owners privately hold shares. This is the most common and preferred incorporation structure for most small businesses in the UK. Over 5.2 million limited companies are operating in the UK now.

Public limited company (PLC)

In a public limited company, shares are available to the public for ownership and purchase. A public limited company must have a value of at least 50,000 pounds before it can trade as a PLC.

PLC is commonly used as a structure for major companies after they make an initial public offering (selling a large portion of their shares in the capital markets).

Limited liability partnership (LLP)

An LLP is a partnership structure used by many businesses including vets, dentists, law firms or accountancy firms. An LLP is made up of at least one limited partner and one general partner (there can also be more than one of each), and these partners have different responsibilities and exposure regarding the business.

Limited partners

• On formation provide property or money to a
• Are liable for all debts up to the amount they have
• They have no operation control and can’t actively manage the business.
• They cannot remove the initial investment (property or money) they put into the partnership.

General partners

• Are liable to pay any debts the partnership cannot pay off.
• Actively manage and control the operation of the business.
• Can make binding (irreversible) decisions on business matters and for the business.
• General partners can apply for ACS ; this is where assets and money are put together and managed on behalf of the partners. The partners end up co-owning the assets but only must pay tax on their share of any profits.

Guarantee Company (LBG)

LBG is a structure used by not-for-profit businesses such as social enterprises that seek a legal structure to operate. This structure is somewhere between a charitable status and a limited company.

In an LBG no share capital is issued, instead, the members act as guarantors for the company. It’s commonly used by trade associations, schools, and other businesses.

Selecting a structure for your business

There is no simple answer to which structure is best for your business, it depends on your business operation and needs. For example, if you:

• Plan to grow your small business beyond yourself (one person) and then sell it, then a Private Limited Company would likely be the most suitable structure.
• Plan to only operate as a one-person business for the near future, then a Sole Tradership would probably be the best structure.
• Plan to start a business that has a significant amount of senior management, capital and that deals in services, then a Limited Liability partnership would be the best choice.

Setting up a structure for your business is not something you do every day, do some more in-depth research and decide what legal structure is best for your business.

Register a limited company

Forming a limited company can be a simple process, but it is also something that should be done very carefully (if you are unsure about something, seek legal advice).

Below you will find an overview of what you will need to register a company, where you can register and other useful details on company formation.

Where can I register my company?

You can register your new company at Companies House on GOV.UK , this process will take you about 30 minutes if you have all the required details ready.

How much does it cost to register a company?

It costs £12 to register a company online (you can pay this fee via PayPal, debit card or credit card). It takes on average 24hrs for your company to be registered.

Details needed for registering a company

To register a company, you will need to have the details below ready:

• A company name (You can find more information on naming your company below).
• Address for the company.
• One or more directors’ names and details (if it is just you that is fine).
• Details of the company shares, shareholding, and shareholders (with at least one shareholder).
• A Memorandum and articles of association . This is a standard document that shareholders create and agree to that outlines the company’s written rules, it’s usually very standardised unless you have specific needs.
• Detailed information on anyone who owns a significant interest or control in the company (this means anyone who owns 25% or more shares or voting rights in the company).

Choosing a company name

When choosing a company name you need to consider legal requirements but also apply common sense:

• Make sure the name you have chosen isn’t trademarked by another company, you can check this via the Intellectual Property Office search on GOV.UK .
• Your name cannot have any profanity in it (that is, rude language).
• Your company name does not have to be the same as your trading name, for instance: your company name could be “Generic media group Ltd” and you might trade under different names for various products the company owns such as “Business magazine, Agriculture magazine…” It depends on your plans, but it can be useful to have a name different from your product or service if you intend to launch other areas of the business, products or services.
• Your name cannot be to the same or too similar to another company that’s registered at Companies House.
• Your business name should be something that’s simple to say, spell and remember.
• Be creative and try brainstorming as many options as you can.
• Test your name and get feedback from your social group.

Ultimately, you should take some time before you decide on a business name.

Setting up a company address

To start a limited company, you need to have a registered business address. A registered address will appear on your Companies House listing and it is where the official post is sent including corporation tax and annual return requests.

You can use your home address, office address or even a PO box. A PO box can be bought from a virtual office provider and is usually a good option if you want a more formal business address from the start (virtual address providers will forward any post onto your home or selected address for a fee).

Creating a memorandum and articles of association

The standard articles of a memorandum document are usually sufficient for most new companies, all you need to do is have all the shareholders read, sign the document and submit it. If you have more complex needs regarding your company’s rules, you should consult a lawyer.

Understanding directors & secretaries

Every company needs at least one director to start, this director or directors form the initial management team of a company. If you are starting a company by yourself, you would need to be listed as a director. You will also need to nominate a company secretary, which would also be yourself if you are the only founder.

Getting shareholding & shareholders right

You want to get shareholding and shareholders details right from the let-go, it can cause a painful situation later if you submit this poorly or even incorrectly, particularly if you take on investment.

A new company with only one director and one shareholder (who are the same person), and a shareholding of 100 ordinary shares owned by this director/shareholder would work well initially.

Register as a sole trader

Registering as a sole trader is a simple process, it just requires you to fill out and submit several forms to the HMRC registering yourself as self-employed.

What details do I need to register as a sole trader?

You only need your national insurance number, a home address and a business name.

Where can I register as a sole trader?

You will need to register as self-employed with the HMRC by filling in the appropriate SA form and submitting it.

Choosing a sole trader name

Being a sole trader, you can trade under your name or a business name of your choosing. If you want a separate business name, it cannot conflict with any existing trademarks, and you will also need to use your name and the business name on any official paperwork.

Deciding on an address for a sole trader

Usually, a home address is fine as this is not made publicly available and many self-employed people operate from home. If you are going to list your business address on a website or anywhere else though, you could consider getting a virtual office or PO Box if you do not have a fixed office address.

Registering a limited liability partnership

Registering a limited liability partnership (LLP) is more complex than most registrations. The details below provide a helpful outline of how you can go about registering an LLP with practical advice.

How can I register a LLP?

You will need to download the LP5 application form from GOV.UK and send it by post to Companies House. All partners in the company must sign this form and it typically takes five days for your limited partnership to be set up.

You will also need to send in a fee of £20 via cheque or postal order at the same time (payable to “Companies House”). As an alternative, you can incorporate the company online through a third-party software.

Choosing a partnership name

The same rules apply to selecting a partnership name as with a company name, see advice in the above, limited company registration section.

Choosing an address for your LLP

The same address rules as for a limited company apply only that your registered business address, for official mail and public listing, must be in the territory where you incorporate initially. For instance, if you incorporate in Wales your registered partnership address must be in Wales. You are free to change this after registration though.

You need a general partner and a limited partner

You must have a general partner and a limited partner to start a limited liability partnership. This cannot be the same person, so the minimum founding team is of two people by default.

7. Setting up finances, accounting and tax

Once you have set up the legal structure of your business, there are several important financial and tax responsibilities you need to figure out.

Opening a business bank account

Before you can start generating any revenue or making purchases, you are going to need to open a business bank account to send, receive and securely store your businesses capital (money).

It is essential to select a bank and business account carefully as it is very likely you will be with the chosen banking provider for the life of the business.

Choose a bank for your business

There’s no simple answer for this, it is best to gather some information on each bank and their offerings and compare to see who’s the best fit. You should look for details such as:

• What’s their track-record in working with small businesses?
• Do they have a range of products and information specifically for small businesses?
• What do other small business customers think of the bank?
• Is the bank respectable, have they engaged in any illegal activity recently?

Once you collect all this information, which you can find online; you should have a good idea of which bank is best for your business.

Select a winning bank account

You also must decide what type of business account or accounts your set up. If you have the wrong type of account, it can significantly affect the cost of business banking. Here are a few things to consider when selecting a business account:

• Do they charge fees based on different transactions, is it a flat monthly fee or is it even free?
• If transaction fees are applied, what charges are applied to each type of transaction?
• Do they provide transaction fee free accounts for certain types of transactions such as online or retail?
• Does the bank offer any complimentary benefits such as insurance, software, or other benefits if you open a certain account with them?
• Do they offer free business banking and accounts for a period? For new ventures, banks tend to offer from 6-24 months free banking.

It will take you a bit of time to gather information on bank accounts and compare it, but it is worth doing as it can save a lot of money, time and headaches in the future.

It can be difficult to change banks

Once you are a few months or years into trading, it can be challenging to change banks and even to change your accounts, as you will likely be processing many payments and purchases through your bank and accounts at any one time.

If you change banks or accounts you will need to update individual partners, suppliers and customers, which is a very time-consuming task. It usually ends up being severe enough that many businesses do not switch banks even if they have an unpleasant experience. You should also make sure to get your payment system providers on point (changing can also be a nightmare), it’s worth learning all the ways you can integrate payments on your website (and providers to use).

Understanding your accounting, tax and filing responsibilities

As a shareholder, owner or director you will likely be responsible for filing some form of accounts, filing paperwork and paying various business taxes to the HMRC on an annual or more regular basis.

Understanding your basic accounting, tax and financial responsibilities from the start is essential to running your business properly, being legally compliant and avoiding hefty fines from the HMRC.

Record your financial transactions

Most businesses are legally required to keep an accurate and up to date record of their finances, this means recording expenditure, income and any other financial transactions of the business. Having up to date records helps to make financial plans and enables you to file your accounts relatively quickly as you have all the relevant data ready for your accountant.

Prepare & file annual accounts

Limited companies and limited liability partnerships are required to submit accounts annually. These accounts are a record of your businesses expenses, revenue and financial transactions across the accounting year.

Your corporation tax bill will also be worked out based on these accounts. It’s typical for an accountant to prepare these accounts based on your accounting records from the year, depending on how organised and up to date these records are this can be a simple or complicated process.

Filing a confirmation statement

Limited companies and limited liability partnerships need to submit an annual confirmation statement . This statement is simply to check that the information that Companies House has about your business is correct and if any is incorrect or out of date, you will need to update these details.

Register for self assessment

Self-assessment involves the annual filing of a set of simple accounts covering your income during the year. The HMRC uses this to assess the tax you need to pay personally. Sole traders, company directors and limited liability partners will need to register for self-assessment (company directors will also need to know about PAYE and dividends ).

Sole traders can also use any business-related costs to reduce their income and overall tax bill. One final exception is that if your limited company is not-for-profit, then you do not need to file self-assessment.

Register for VAT (Value Added Tax)

If your business is likely to have more than the VAT threshold in annual sales, you will need to register for VAT . This is a flat rate tax you must charge on top of any goods or services you sell.

On the positive side, once you’re VAT registered and have your VAT number you can purchase products from other businesses VAT free.

Register for corporation tax

If you have a limited company and it is trading (this means making any financial transaction), you will need to register for corporation tax within three months of starting your business or beginning to trade.

You will be assessed for corporation tax through your annual accounts and will need to pay a flat rate tax based on the profits generated by your business. You can find more details on paying corporation tax here and further details on registering for CT here .

Understanding business rates

Business rates are a tax levied on business premises by the UK government and delivered by local authorities. They are charged annually on business properties including shops, factories, offices, warehouses, bars and more.

If you own or rent commercial premises, it is likely you will need to register for and pay business rates. However, if you are running your business from home it is unlikely you will need to pay business rates.

Tell Companies House and HMRC of any changes

If your business details significantly change you will need to inform the relevant authorities, for instance, for instance; if your registered address changes you will need to tell Companies House/HMRC straight away.

Hire an accountant

When it comes to starting any small business, it is advisable to have an accountant. A good accountant will save your business substantially more money than they cost to hire. Specifically, an accountant will ensure:

• You pay the right amount of tax.
• Ensure you meet, file and pay any major tax deadlines ,e. annual statements, accounts, corporation tax…
• Have expert financial advice and information at your service.
• Ensure your annual accounts are correctly compiled and submitted to the HMRC.

In summary, a good accountant will make the financial aspects of your business much easier to handle and save you much money in the process.

Choosing an accountant

The ideal accountant for a small business that’s just starting up is a local independent accountant who will give your business finances the time and attention it needs and probably be less costly than a major firm.

How much does an accountant cost?

Accountants will either ask you to pay a lump sum annually or more commonly a monthly fee that will cover the ongoing work. The amount typically depends on how well you can negotiate, but it will likely be between £30-150 a month depending on the complexity of your business financial matters and filing needs.

Sole traders however, probably only need an accountant once a year for self-assessment and this should cost between £80 -200.

Choosing small business accounting software

Unless you are a sole trader with a few transactions going through your business each year, yes, you need small business accounting software , and there are two primary reasons:

• If you are a limited company or partnership, your annual accounts, which you must legally submit to the government yearly, require all your records from the annual accounting period.
• So you can accurately track all your financial transactions and the financial health and future of your business (including costs, revenue, and profit).

It cannot be stressed enough how important it is to keep up to date and accurate financial records from the start. Failure to do this can result in losing a lot of time, money and in some cases criminal prosecution.

8. Protect your business

Once you have taken care of all financial matters, it is necessary to protect your business from the unpredictable by taking care of certain legal and insurance issues.

Find a solicitor or law firm

Most companies will not need to hire a legal advisor initially, except if they want advice on company set up or have some specific legal matters that need attending. However, at some point in your businesses life-cycle, you will need some form of legal support, whether that is drawing up contracts or protecting your business interests in court.

Make sure that if you hire a legal advisor at some point, you always agree on an hourly rate and on the amount of time required in advance for any work.

Getting intellectual property protection in place

Intellectual property (IP) is intangible property that is the result of creativity . Protecting your IP as a business can be critical to protecting your business, brand and products from damages that come from people using your intellectual property without your permission.

This section explores intellectual property rights and protections you can put in place to protect your business’ intellectual property.

Trademarking a name and brand

A trademark is a legally registered symbol, word or words representing a business that legally owns it, protecting the business from anyone else using this name or symbol.

For new ventures, you will want to trademark your company name and brand , this makes sure you legally own your brand and company name, and prevents anyone from misusing it.

Patenting an idea, technology or process

A patent is an exclusive right granted for a product, invention or process that provides a new way of doing something or provides a new technical solution to a problem. Applying for a patent is only relevant for new businesses that have invented innovative technology or product that could be copied by others. A patent grants your legal ownership of this invention and the exclusive right to it, thus providing your business with protection.

The relevance of copyright law

Copyrighted work means that other businesses cannot use your written or creative work without permission. Copyright is primarily employed by book publishers, theatre companies and other types of entertainment/information based companies who need to ensure works are not reproduced without authorisation.

Make sure you have small business insurance

Business insurance for a new business can be an absolute lifeline that provides much-needed financial and legal support when the unexpected happens. Whether you must recall a dangerous product or have an employee endure an accident at work, having the right insurance can be the difference between a business being able to cope with a disaster or having to close. With that in mind, this section gives a quick overview of the major types of insurance you might consider for a new business.

Public liability insurance (PLI)

PLI protects businesses against losses suffered by people or customers injuring themselves or sustaining property damage due to the activity of business, it is one of the most common types of small business insurance. It is of particular importance if you operate physical premises and regularly interact with customers in a third party or business owned premise.

Professional indemnity insurance (PII)

PII is for businesses and professionals that provide advice or services to customers. It protects your business against any claims for damages or legal costs which arise due to act omission or breach of professional duty in the daily course of operations. It actively protects your business if advice or a service provided negatively affects a customer.

Employers liability insurance (ELI)

ELI protects a business that employs staff from financial losses incurred when a staff member experiences a job-related illness or injury. Workplace injuries can be extremely costly for an employer if they are liable. ELI offers protections against this and it’s particularly relevant for business who have many staff involved in physical work on their behalf, i.e. manufacturing, event running…

Product liability insurance (PLI)

Product liability insurance protects your business from damage to property or personal injury caused by products your business/company has supplied or sold.

Key man insurance (KMI)

Key man insurance protects businesses from the loss of a key employee such as a CEO by paying out a large sum on the event of their death or incapacitation. It is effectively life insurance against anything critical happening to a key employee. If your business is entirely reliant on one employee or a small group, this insurance can often help save the business from bankruptcy in a disaster situation.

Landlord insurance (LI)

Landlord insurance protects business owners who own property from losses sustained as the result of renting that property. If a business owns its office and rents it out to other companies, this type of insurance will protect you from damages caused by a tenant.

Trade credit insurance (TCI)

Trade credit insurance is insurance that protects private companies from their customers being unable to pay back a debt due to bankruptcy, default or insolvency. It’s most relevant for companies that operate under a B2B model and have a range of key customers who use offered credit facilities.

Director’s and officers liability insurance

D&O insurance policies can protect management from personal liability in the event a claim is made against them for wrongdoing. For example; if a director knowingly or unknowingly communicates incorrect financial information that leads an investor to lose money or make a poor decision, resulting in a claim against the director.

Business contents insurance

Business contents insurances provides coverage for your equipment, tools and even stock on your business premises (you can also get specialist stock insurance if you carry high volumes of goods), to cover the cost of replacement or repair commonly in the event of fire, flood or theft.

Choosing the right business insurance

As with buying any product or service make sure to shop around and compare prices and clauses. With insurance, you will want to read the small print very carefully and clarify the conditions around your insurance policy (to make sure you a policy covers losses or damages thoroughly).

Regarding selecting an insurer, look for firms who have an excellent reputation and long record of accomplishment in insuring small businesses.

9. Create a brand and identity for your business

Now that you have protected your business adequately, it is time to create a public facing identity. This is how you present your company to the world including branding, setting up a basic website and creating a business e-mail address.

Create a professional brand for your business

Having a professional brand is critical to any business that wants to stand out in today’s competitive environment. That does not mean the branding process needs to be costly or time-consuming, there are just a few key things you should consider for creating a professional brand:

• Create a logo (Options are to hire a designer on Fiverr , use online logo maker, learn graphics and do it yourself or use a cost-effective design agency).
• Create a colour scheme for your business that will be used across all promotional and company assets (you can use a colour selector to find a palette and it’s also a good idea to look into basic colour psychology before you choose).
• Come up with a slogan for your company if you think it is useful.
• You can also create a symbol that can be used as a recognising mark of your company when you do not want to put your full dress logo, such as on a product (it is typically included in your logo).

It is important to take your time though and explore a few different branding options before settling on an initial brand.

You need to create a website for your business

Whether you are a retail store, a chemicals company or a modelling company having at least a basic website is a requirement for business in the 21 st century, customers expect you to have a website and expect to be able to find it easily. Your website should:

• Include and show your company/business details including address, phone number, name, and logo (if you have a limited company number it is also a legal requirement to list it here).
• Provide a clear description of what your business is/does.
• Provide details of your products, services, and
• Provide a business e-mail or contact form that enables prospective customers/outside parties to reach you easily.

You can add many more things to your website, this is just the basic information you need to include. Now, how do you create a website?

How to create a website for your business

Creating a website is not nearly as complicated as you might think it is. There are many different types of software, website builders and helpful information that allow you to build a simple website for your business.

Easily build your own website

If you do not want to take on this task or are unclear on how to do it, you can always outsource it to a freelancer, but there is a far better and cheaper option available. Website builders have come to the stage where you can build your entire website quite simply through one provider with no prior experience. Companies like Wix, Squarespace, Weebly, Wix, Shopify or BigCommerce offer very simple to use tools so that you can often have a simple website up and running in under an hour. However, if you decided to explore the possibility or even build your own website, we have outlined the main steps you will need to accomplish this with helpful tips.

1. Purchase a domain

A domain name is your public address on the internet, it is the URL that appears at the top of your browser on any website, for example: www.cocacola.com. The first thing you need to do is purchase a domain for your business. Typically this domain would be your business name, if this taken, try different variations.

You can buy a domain name from popular domain registers such as GoDaddy or Name Cheap (try to make sure you purchase a .co.uk or .com domain, these are important trust indicators for anyone visiting your website).

2. Purchase website hosting

Web hosting involves renting all or part of a server (online computer) where your website will be stored, think of it as renting virtual land for your office. When looking for a reliable website host, you will want to review a few things before choosing a hosting provider:

• What’s the reputation of the hosting company?
• What’s the cost of hosting compared to other providers?
• What’s the host’s uptime compared to other vendors? (% of time their servers are live.)
• Do they provide one-click installs of LAMP/LEMP and CPANEL/WHM and WordPress (Read further on for descriptions.)

If you are in a hurry, popular and cost-effective web hosting companies include Bluehost, GoDaddy and 1&1.

3. Point your domain name to your server IP address via DNS

The Domain Name System (DNS) is the internet’s mail routing system in a way. When someone types the domain genericmedia.co.uk, your hosting company’s server will respond by telling the computer that genericmedia.co.uk website is stored on a particular server with the IP address of xxx.xxx.xxx.

Many hosting providers will automatically generate the correct DNS record, pointing your web address to the server IP address when you install your website, but a number do not. If you need to set this, you will need at an elementary level to add an A record pointing your domain name to your correct server address (you can typically find your DNS panel in your hosting provider’s portal).

4. Point your domain to your web hosting company

Now that you have set up your domain, hosting and correct DNS records it is time to point your domain at your web hosting company. This is done by changing your domain’s nameservers. Start by looking for the nameservers/DNS in the domain company’s portal.

Once you have found it, you will want to swap out the current nameservers for the ones your web host has given you and click update (if you do not know what these are, do a Google search on “nameservers” and your web host’s name, they usually pop up!).You now need to wait 5 – 48 hours for the nameserver change to propagate across the internet.

5. Install LAMP & WHM/CPANEL

Depending on your hosting company this may already be set up, if you see anything that says ‘enter cPanel ’ or ‘cPanel’, it likely already is and you do not have to do anything! For other hosts, you will need to install a LAMP stack (the underlying technology used by the server) and WHM/CPANEL, the web hosting software that allows you to set up your website. There are many steps by step guides providing information on how to do all this for different hosts across the web.

6. Install WordPress

WordPress is often the go-to choice for flexible content management systems that allow you to build and manage websites with little technical skills. Installing WordPress usually requires a one-click install from cPanel under Softaculous or another auto-installer (if you do not have an auto-installer you will need to download and transfer WordPress via FTP, this gets a bit more technical). Make sure to note down your login details as well!

7. Purchase & install a website theme

Login to WordPress at yourwebsite.co.uk/wp-admin. You should have a new up and running website, now you need a design in the form of a WordPress theme. These themes (designs) give different aesthetics, structures and control options depending on which one you get.

You can find a free theme or purchase a theme to suit your needs. There are particularly good paid options built for many types of small businesses including blogs, restaurants, builders, and many more. You can find themes to download via WordPress or go to paid providers like Themeforest. Once you have one, you will need to upload and activate your theme via the appearance-themes panel in WordPress.

8. Add all your information

Now it is time to create pages and add all your business information.

• Create your pages (Home, about, contact us).
• Add your logo.
• Add your product, service, or solution listings/details.
• Add a menu.

Congratulations you have built a basic website, now it’s time to get a professional e-mail address.

9. Make sure your website is maintained

Maintaining your website is essential to ensure its success and longevity. Without the proper website maintenance, you could face a variety of potential issues that can harm your website’s performance along with your business as a whole. Website maintenance ensures that website content remains up-to-date, website security is maintained, website features are working properly and any technical issues are addressed promptly. Regular website maintenance also helps to maintain high search engine rankings, as well as keeping visitors engaged by providing fresh content on a regular basis.

Overall, website maintenance should be seen as an ongoing process rather than a one-time task. Regular website maintenance allows website owners to keep their website running smoothly and increase its visibility, improving the website’s overall success.

If you are unable to maintain your website on your own , there are a number of companies that provide website maintenance services. These companies can help with website updates, website security, website testing and more. Hiring a website maintenance company can be more cost effective in the long run and also allows website owners to concentrate on their core business activities without having to take time away from their other commitments

No matter how you choose to maintain your website, it is important to make sure that regular website maintenance is carried out in order for your website to remain successful and continue driving traffic and sales.

Bonus step for eCommerce entrepreneurs: Choosing your eCommerce platform

If like many new entrepreneurs your wading into the eCommerce waters, then choosing a platform is potentially the most important facet to get right before you start a site build. There are many eCommerce platforms available out there that promise to provide the best online experience. To keep you guided on what eCommerce platform to choose, it pays off knowing their different categories.

• Web-based eCommerce platforms: Web-based platforms provide eCommerce software or shopping cart service directly to the end users. Some examples of these platforms include Commerce Server, Drupal, and Joomla. Web-based platforms offer the user a fully-functional online store while others give limited functionality.
• On-premise eCommerce platform: A lot of businesses prefer to use an on-premise eCommerce platform for their eCommerce needs. These platforms have been designed for small businesses and are highly customizable. They also provide a hosted service that includes full-customization options for customers.
• Off-premise eCommerce platform: An off-premise eCommerce platform is designed for larger businesses or companies. They also offer the user greater customization and features that come with the hosted services. The main benefit of using off-premise platforms is that they are able to offer the full features and security level offered by the hosted services without the additional cost. The downside of using this platform is that it does not provide any of the same options that the hosted solutions do.
• Hybrid or multifunctional eCommerce platform: This platform allows you to choose from many different ways to manage your business. The main advantage of using this type of platform is that it helps reduce operational costs and improve the overall operational and business performance. Some of the features of this platform include automatic submission of orders, automatic replenishment of stock, automatic inventory management, and customer management. They also offer customization for custom logos, themes, and colour schemes.

As you can see there are many factors to consider when choosing a platform for your eCommerce website. If you want a platform that will help you make better use of your resources and get the maximum return out of your investment, you should opt for an eCommerce hosting provider that has all the features that you need. The right platform will help you increase your profits as well as the profitability of your business.

Create an e-mail address for your business

Once you have a website, you are going to need a professional e-mail address where prospective customers and external parties can reach you, this means that instead of using:

[email protected]/outlook.co.uk or [email protected] you will be using [email protected] or [email protected]

Having a business branded e-mail address is critical to engendering trust and is a general standard for most businesses in the UK.

Fist set up an email address using G Suite or another third party email service. Then you’ll need to make sure your email is routed correctly which is done by updating your MX records. To change your MX records you will need to look for your hosting company’s DNS panel.

Once your MX records are updated any email received by your server for your domain will be sent to Gmail (or the email service provider you’ve chosen) i.e. any mail received by genericmedia.com would be forwarded to your email. This is easier to do than it sounds!

Initially, unless you have more team members, you will want one generic email address: mail@, info@ and one personal address such as [email protected] or [email protected] .

10. Buying the business essentials

Getting the basic essential setup for any new business is not glamorous, but it is very necessary. Whether that is sorting the internet, phone, utilities or purchasing technology among many other things, here’s a quick guide to getting the essentials right.

Setting up business broadband

Fast and reliable internet is a necessity. Whether you need to sell online or communicate with customers, the internet is a vital component for most new businesses. Here are some guidelines for choosing a secure, reliable and fast internet provider and package:

• Make sure your connection will have a minimum of 20mbs download speed and 6mbs upload speed (Broadband or Fibreoptic).
• Check reviews online of each company and the different tiers/types of internet packages they offer.
• Make sure the contract length is no longer than 18 months (you usually negotiate heavily when your contract comes up for renewal, lowering the cost).
• Verify that the company has a responsive customer service team rather than an automated machine or poor customer service. This can be a nightmare when internet problems occur and has a been a big problem over the last year, particularly in the UK.
• If you live or work in an area where broadband or fibre is weak regarding internet connectively or it doesn’t connect at all, consider a 4G internet contract and an antenna as an alternative solution to get fast and stable internet.

Most of the above is quite logical, but it is easy to miss things in the hubbub of starting a new business.

Getting a business phone line

Having a landline number for your business is still a necessity for having a legitimate business image from the start and for having a fix and reliable number where customers can reach you on.

If you own or rent a private office, it is easy to set up a business line with your phone package. However, if you do not, you can still purchase a business landline in London and many other cities that will route to your mobile phone, allowing you to take calls via that number and make calls online using that number.

Finding office space

Apart from working from home, there a few different options for entrepreneurs looking for space to start and run their businesses.

Rent a co-working space

Co-working spaces allow you to flexibly rent office space or an individual desk at a relatively low cost compared to traditional serviced or private office options. They also offer an environment designed for start-ups with a great community of like-minded entrepreneurs.

Apply for a business accelerator

Accelerator programs provide seed investment, mentorship and office space for a limited time to start-ups and other small companies. If you are a technology business there are many accelerators where you could apply for in many major cities in the UK.

Rent a business incubator office

Incubators are effectively low-cost office space that offer some level of community and network. Non-for-profit companies, charities or universities typically run them.

Rent from another local business

Many large to medium sized businesses that find they have excess space are often open if approached by a smaller company about renting unused space in their premises. It is a great source of extra income for the landlord business and often a flexible renting agreement for the tenant business.

Rent a serviced office

If you are starting with a large team and have investment ea serviced office is probably the best option for you . A serviced office will not be cheap but you can usually choose the layout that best suits your team on a particular floor or area of the building.

Selecting business stationary and signage

It may be hard to believe but for limited companies there are specific laws you must obey regarding the details you include on signage, stationery and promotional material.

Choosing a sign for your business

It is a matter of British law that you must display a sign showing your company name and your registered business address as well as any other address where your business operates in your business premise (if your home address is where your business is based you do not need to display a sign).

Office supply and stationary options

When purchasing official company stationary or producing promotional materials such as letters, forms or your website, you must display your company name, company number, registered address, and the country your business is registered in (Scotland, Wales, England, or Northern Ireland). If you also decide to list a director’s name on materials, you must include all the directors’ names if there are more than one.

11. Find funding for your new business

Most businesses require some source of funding to start. This section covers the primary sources of financing available to small businesses with the relative advantages and disadvantages.

Your savings

Some of the world’s most successful companies have been initially self-funded. The upside of this option is you do not lose any control by involving any outside party. The downside is that depending on the business you are starting, you may need more capital than you have or it may run out very quickly.

Friends & family

Many entrepreneurs receive their initial funding from friends and relatives in the form of an investment or loan. This is because in many cases you will not have to pay this money back if something goes wrong or you can agree on preferable terms when dealing with friends and family, usually both!

The upside is that your family or friends are unlikely to try and bankrupt your business to retrieve their money if you cannot pay them back within the terms set. The downside is you can put relationships in jeopardy if things do not go to plan and you cannot pay the money back or if expectations are poorly managed.

Business grants

Business grants are free funding (money) awarded to qualifying businesses. A significant amount of public and private grants are available for new businesses ; typically they are designed to support businesses starting up in impoverished areas, to boost the economy or to promote technological innovation and research.

The best place to start looking for small business grants is your local Council website. They typically will have all the details of local grants available and of some national ones as well. Grants tend to range from £1,000 up to £5,000,000 in size, the amount depends on the grant (it is also common for payment to be made in stages based on achieving certain conditions).

The plus side of grants is it’s free money with the downside being that applying for grant funding is often a complicated and time-consuming process, and the probability of obtaining one is not very high. Still, many businesses in the UK receive grant funding each year, it is still worth a shot!

Business competitions

Business competitions offer the chance to win free funding for your business, typically between £500 and £50,000. Large corporates, universities, or local councils usually run them to gain exposure, support the local economy or as a PR and marketing stunt.

Competitions are often underapplied for and applying is usually far less time-consuming than applying for other funding sources like grant funding. The downside is you might not win and lose a lot of time and energy in the process, depending on the requirements and conditions of the competition.

Angel investors

An angel investor or business angel is a wealthy individual (commonly a former entrepreneur) who is willing to provide money for your business in exchange of a percentage shareholding in your business. A business angel is usually a good option for businesses who are a little further along than just starting out, as these investors typically want to see some growth/traction in your business before investing.

However, some entrepreneurs do raise business angel finance initially ranging from £30,000 to £150,000 (typically under the Seed Enterprise Investment Scheme or EIS ). The downside of this option is you’re losing some control at an early stage. The upside is that it’s a much quicker way to raise money than through VC or grant funding. Angel funding usually has few requirements and angel investors at this stage are primarily investing in people much more than they are in the business!

Venture capital

Venture capitalists are professional investors who invest significant sums of money into many companies with the aim of making a return on their overall portfolio.

At this early stage, venture capital unfortunately is only applicable to highly technological companies that operate in fields such as life science and biotech. These types of companies require huge initial investments from the start and can justify this funding by the promise of massive innovations and breakthroughs in technology and science that could yield considerable returns.

The relative downside of venture capital is that it is hard to raise and, as professional investors, they will actively take ownership and control of part of your business. The upside is that you can raise a considerable amount of money very quickly (if your business already has much traction, venture capital could also apply to you).

Crowdfunding

Crowdfunding is a relatively new form of investment , it allows you to raise small amounts of funding from many people. This can be done by selling equity or offering a reward or product in a presale crowdfunding campaign.

Crowdfunding campaigns typically require an enormous level of marketing to be successful in most cases. The upside is that a campaign gives you the chance to test if people are receptive to your business and if you crowdfund goes well, in some cases, you can raise your funds in 48hrs (of course, after having prepared for months). Crowdfunding platforms like Seedrs and Crowdcube offer equity solutions, and Kickstart and Indiegogo are the go-to choices for pre-ale/rewards-based crowdfunding campaigns.

Business Loans

A simple business loan means you borrow an amount of money from a bank, person or lender and agree to pay it back over time, such as in a timeline with interest.

Although loans offer a flexible way for businesses to raise capital , in most start-up situations they are not an ideal form of funding as you’re immediately taking on a risk where if you cannot pay back the loan you could lose your business and any personal wealth you have (depending on the liability).

Given that banks do not lend as much as they used to to new businesses, the start-up loans scheme detailed below is likely the best option for anyone starting up if you want to raise finance this way.

Getting a Start Up loan

The Start Up Loans Scheme was launched in 2012 by the British government. It made available £150+ million pounds of public money to entrepreneurs in the form of a favourable, low-interest loan up to the amount of £25,000. Eligibility and facilitation of a start-up loan are carried out by delivery partners who assess each business plan or business case.

The loan is typically payment free for the initial year where you only pay nominal interest payments each month, with the bulk repayment starting on the second year and being paid back over as much as five years (be aware that although the loan terms are very favourable the actual debt obligation lies on you).

Over the last few years, many businesses have been successfully launched by entrepreneurs who took startup loans. It can be a good funding option depending on your situation.

Business credit cards

You occasionally do hear stories about entrepreneurs maxing out business credit cards to fund their new business that quickly becomes successful. What you do not hear a lot is about most entrepreneurs who max out their credit cards and go bankrupt.

A business credit card is one of the worse forms of finance to use for starting a business. The interest rates, penalties, and complexity of this kind of short-term finance only make it useful to trading businesses which are profitable and need a flexible credit facility.

Business overdrafts

A business overdraft is a flexible lending/credit facility you will agree with the bank or another financial institution. An overdraft allows you to borrow a set amount of money on an ongoing basis or until the bank withdraws the facility. You pay an agreed monthly rate of interest on top of anything you borrow.

It is not a good form of finance for starting a business and should only really be used by trading profitable companies. It is specially useful for businesses who have seasonal businesses or cashflow issues due to longer client payment terms or other reasons.

12. Creating a sales and marketing strategy

Sales and marketing are the beating heart of any new business, for a business to be successful it needs to be innovative at marketing and effective at selling. When it comes to starting a business, this means thinking about preparing your product or service for sale, how you plan to go to the market and what channels and systems will be employed to reach and close customers.

Getting a product or service ready for sale

Once you have a product or service ready to be sold, you need to start packaging it for the market, this means considering differentiation, positioning and pricing.

Positioning your offering

Positioning is all about identifying your product’s/service’s key attributes and how you are going to communicate them to the customer. It is about defining who you are and what you are offering in a way that resonates with your prospective customer.

Understanding your USP (Unique selling point)

Differentiating your offering from your competitors is all about identifying and showing your USPs (Unique Selling Points). This means thinking about where you offer superior functionality and value over your competitors and how you can communicate this through your marketing message.

Setting price at the right level

Pricing a product or service is tricky, it is often unclear for new entries into a market what pricing strategies you should implement, so here are few ways that will help you to calculate a fair price:

• Work out your costs per unit.
• Work out the profit margin you will be making per unit/per hour.
• Gather pricing information on your competitors’ products or services.
• Find out what the customer is willing to pay. This will require market

Once you’ve done your research and pricing analysis, it comes down to what you think the market will bear combined with what you want to make per unit or per hour for any product or service respectively.

Choosing a route to market

Once you are ready to go to market, you need to figure how you will get there. This means choosing the best route to market ; this could be online, through fixed retail, wholesale, even selling through a third party or a mix.

Selling online

Selling online could be in the form of an online shop or a subscription software platform (SAAS). The internet offers small businesses complete control over their route to market. Many new businesses will choose to sell directly to their customers through the web as it provides fantastically low overheads with little required investment compared to starting a physical business location.

Selling via a retail shop

A retail store is a public place where customers can go and purchase from your business directly. Retail stores give you a guaranteed audience of passing customers depending on the site. This type of sales route is perfect for high-volume product-based businesses, but it also works for services, i.e. travel agents, insurers…

Selling wholesale

Wholesaling offers businesses the chance to sell their products in bulk to suppliers or retailers who will then go and sell directly to the public through their own sales channels. The profit margin from this model is usually smaller given that there’s another party involved, but it does offer the potential for selling substantial orders and generating significant revenue.

Selling through an agent or affiliate

Hiring an agent or affiliate on your behalf means they will find and connect you with potential customers, thus doing most of the marketing and some of the sales work for you. You will however usually have to pay a hefty commission to the agent when a customer they refer converts or a fixed fee on a per lead basis.

Selecting marketing channels

Once you have chosen a route to market, selecting the correct marketing channels to generate interest and customers is critical. There are many different channels and you have to find the most cost-effective and high-return channels for your business. It can take some time and testing.

Email marketing

Email remains the core way people and businesses communicate online. Thus, email marketing (reaching potential customers via email) is one of the primary marketing channels for generating customers and sales. This type of marketing could be done through newsletters or cold sales emails, and it is one of the online marketing channels available with the highest return on investment.

Online advertising

Pay per click (PPC) advertising is one of the most popular forms of online marketing. It typically involves using paid display and search advertising via Google and other networks to reach potential buyers and drive them to your website or landing page.

If PPC campaigns are well targeted and managed, it can be a highly efficient and reliable method of generating business. It is important to note that social media and Facebook advertising also now accounts for a huge amount of marketing budgets for many businesses.

Social media marketing

Social media is one of the newest and best ways to reach potential customers. Whether it is Facebook, YouTube, Pinterest, LinkedIn or others, there is a range of social media platforms that are useful for effectively targeting and reaching your ideal customers. It is time-consuming to build and maintain an account, but in the long term it has proven to generate a significant return on investment for many brands.

Content creation

Written content can be an excellent way to reach customers via online search. If you have access to a good writer and your business is primarily online, one of the best and cost-effective ways to reach your customers is through organic search. Out of all forms of online promotion, natural search traffic is the highest converting regarding sales, it is particularly useful for promoting your website to potential customers .

Posting a letter

An old-fashioned method, direct mail marketing is still used by many companies today to inform potential customers about their offering and drive sales. It is particularly useful for service-based companies who have complex offerings that need to be described well, i.e. pensions, life insurance…

In the UK you may be asking yourself ‘how can telesales even be a marketing channel anymore? No one has a positive experience’. However, you might be wrong, many businesses still rely heavily on telesales for large swathes of their marketing and sales budgets, and the return is still substantial, particularly in the telecoms industry.

Build a sales process

Creating an effective sales process is about taking potential customers generated by your marketing efforts and turning them into paying customers.

With sales and marketing inextricably linked, it is important that your sales process will highly convert the leads that your marketing delivers, otherwise marketing is a waste of resources. This section covers the assets you will need, the pipeline you will need to set up and how to create a great customer service team.

Building sales assets

Sales assets are the documentation and document-based promotional material used in the selling process, for example, this could mean leaflets, brochures, PDFs, pitch decks and much more. These materials are critical to a salesperson as customers will often ask for a presentation or written document during the sales process.

These assets demonstrate key features and advantages of any product or service. It is imperative to have these assets ready, looking professional and well-structured for your sales team to use.

Building a sales pipeline

A sales pipeline is at the core of any sales process , it is a system that continuously tracks the stage of the customer. This pipeline allows sales teams and managers to see where prospective customers are regarding the sale and to look for efficiency gains and problems that need correcting in the sales process.

A typical sales pipeline is just a set of stages going from A to Z, A being the first contact, Z being when the sale closed (there can be further steps if you include cross-selling or up-selling as part of the same process). To manage this pipeline businesses will typically use a software-based CRM (customer relationship management) system. It is crucial to the sales process to have a structured pipeline set out so you can ensure every potential sale is tracked and there is maximum conversion.

Create a customer service team

One of the most overlooked areas of sales is customer service , with many organisations seeing sales and customer service are separate functions. This leads to a lack of focus on proper customer service will dramatically increases the amount of customers lost and thus the long term profitabilltiy of any sale.

This means that from the start it is critical to building a strong customer service framework and team to minimise the loss of any clients and maximise the longevity of clients or repeat purchases. This all contributes to the sales bottom line.

13. Building a team for your new business

Most new businesses will start with a small team or begin to grow one very quickly. Thus, businesses and entrepreneurs need to learn early on how to effectively recruit and manage their team, while developing a great company culture and themselves as leaders.

This section is here to guide you through the initial setup of what will become your business’ human resources department, covering recruitment, management, company culture and self-management.

Brilliant recruitment practices are linked to business success

Don’t hire anyone until you absolutely need to. The work and responsibility that come with employing another person is tremendous. When you do get to a stage when you need to recruit, it is important to make sure you take the right approach to finding and employing the best person or people for the role and for your business.

Attracting great employees

The start of a recruitment process is about finding and getting the best potential candidates to apply for the position you have open. Companies who want to attract great candidates should:

• Offer a competitive remuneration package (salary, benefits, share options).
• Use their company’s vision to inspire a candidate to want to be part of the enterprise.
• Show career progression possibilities for the candidate.
• Demonstrate a progressive, diverse and exciting work culture to the candidate.

Beyond the basics of attracting great employees , it is often about highlighting how your offer is better than other organisations’ offerings, i.e. if you cannot compete on salary, compete on offering responsibility and progression.

Create a strong recruitment process

Once you have attracted a good pool of potential candidates having a strong recruitment process is key to making sure you end up hiring the best candidate. At a minimum, this means having a process with:

• A clear timeline and stages for candidates.
• Unambiguous criterion for what you are looking for and how you will be assessing candidates.
• At least 3 interviews (ideally with different members of your team).
• A step for checking previous work references and thoroughly vetting candidate claims.

A poor recruitment process may leave you with the worst candidate. A strong recruitment process will enable you to work down to the best candidate efficiently. Companies who choose to invest time and resources into the recruitment process will always outperform those who do not!

In-house recruitment vs outsourcing

Outsourcing recruitment to an agency and in-house recruitment both have advantages. When it comes to choosing there is no easy answer, the best method depends on your business situation. However, to help here are some the key advantages/disadvantages of each.

Outsourcing recruitment

• A professional agency will find candidates that exactly fit your profile.
• It eliminates the need for an extensive in-house recruitment team.
• It can be very expensive (the agency will usually take a fee between 15% and 25% of the candidate’s total first year annual earnings).

In-house recruitment

• It enables you to control and optimise all aspects of the recruitment
• It’s usually cheaper than hiring an outside agency.
• It will require the use of an internal team and resources.

When it comes to choosing, smaller companies who are profitable will often choose to initially outsource the first steps of the process to attract candidates and then do in-house recruitment and asses the candidates themselves.

Creating a management ethos and system

Excellent management is essential for the success of any business. From the very beginning your management team or even just you as an entrepreneur need to create a clear management structure, a positive work environment, and build a company culture that will support the business and its people as you grow.

Set management structures

Getting a management structure in place early on is critical to any small business that hopes to grow. This ensures that business’ policies and objectives initiated at the top will be carried out throughout the structure and that there will be accountability for their progress. In practice, this means having clear structures, roles, objectives, roadmaps and responsibilities, tracking employee performance, having team building exercises and feedback sessions, among other areas.

Create a positive work environment

Having a productive workforce is inextricably linked to creating a positive and supportive work environment. This means that from day one, managers and CEOs should make creating and maintaining a positive work environment a core company objective. This could mean holding office social events, providing large desk spaces, having clear HR policies and career progression, offering flexible holidays or any other initiatives that employees would value.

Build a great company culture

People are the primary resource of any business. Your founding team may work hard, be passionate and close-knit but how do you make sure that culture of excellence and responsibility scales with your business?

Very simply, by clearly outlining and documenting your company culture and making sure it is one of the main objectives of your business. Company culture should be considered in the hiring process and each new employee should be introduced to it. It should not be something unspoken but something at the core of the business.

Making sure you are compliant with employment law and taxes

Building a great team can be complicated and not just regarding recruitment and management, but also regarding understanding and adhering to your tax and legal responsibilities when hiring . You need to be aware of the legal, tax and pension responsibilities that come with employing people.

Knowing employment taxes

When hiring anyone in the UK, you will need to pay several monthly employment taxes on their behalf including national insurance contributions for each employee. These taxes are typically paid via PAYE; this system is the primary mean of collecting employment taxes from UK companies by the government (speak to your accountant if you need to register for PAYE).

Understanding employment law

Employment law in the UK is strict and well set up to protect both businesses and employees; there are several key areas all employers should be aware of:

• You must pay each employee at least the minimum wage .
• After two years of continuous service, employees are entitled to a redundancy packag e if they are forced by your organisation to leave their job without cause,e. workplace closure or need to reduce workforce.
• Females employees are entitled to 52 weeks of maternity leave and men up to 2 weeks if they have worked longer than 26 weeks for the business.
• The maximum number of hours anyone can work for an employer in a week is 48 hours, unless they agree to work further and sign a release.
• Employees are entitled to at least 28 days paid holiday a year (this is prorated for part-timers).
• You cannot unfairly discriminate by race, gender, disability, or any other factor regarding recruitment, pay, promotion, access to training, or termination.
• Unfair dismissal applies after two years of continuous employment and companies can be fined by having to provide compensation to employees wrongly terminated.

It is important to be aware of employment law and the aspects that affect you as an employer.

Providing a pension for employees

As of 2018 the Pensions Regulator has made pensions mandatory for all employees who work in the UK, are aged 22 years or over, and earn at least £10,000 a year. This means that as a small business and employer, you are legally required to provide a pension scheme for all staff that meet the above requirements. Note that to contribute to this payment scheme you can choose a private business pension provider.

Managing yourself

As an entrepreneur, one of the difficult things you will often face is managing stress, fatigue, and pressure while balancing work and life. This is common as there is an enormous level of responsibility upon you as an entrepreneur and leader. In this section, we cover how you can mitigate this by creating a support network, engaging in the community and finding mentors to guide you through the perils of entrepreneurship.

Build a support network

Whether it is friends, family or colleagues, having a strong support network around you is critical. This system will help to support you and keep you going through the ups and downs of the entrepreneurial path, make sure not to neglect this network!

Meet the start-up community

Start-up communities and networks in the UK and across the world are prolific and well established. Engaging and becoming part of these communities in your local area is an excellent way to meet other entrepreneurs, share stories and exchange ideas and advice.

Find a mentor

Finding an industry relevant mentor is one of the best things you can do when starting any business. If your mentor is knowledgeable in your sector, he or she will be able to provide advice and guidance. It is true what they say, great entrepreneurs learn from other people’s mistakes.

14. Starting a business in your spare time

If like many reading this article you have a full-time job and can’t afford to quit your job to start straight away, have no fear. In this section, you can learn how to start a business and make it successful in your spare time without having to leave your job. One way of reducing the risk of starting up your own business is to hold onto your day job in the early days and work on your business in your spare time at evenings and weekends.

It’s an appealing idea because if your business venture fails then you still have your job, and if it succeeds then making the transition to being your own boss will be a lot less risky. In fact, there are now so many people running businesses from home in their spare time at evenings and weekends that there is even a name for them – the 5 to 9 ers.

Perfect businesses to start in your spare time

• An internet-based business which does not require your constant physical presence for it to function
• A business that can outsource many of its functions. Husband and wife Brent and Marilena Shaw run their online luggage business Swiss luggage.com in their spare time while both do full-time day jobs. They outsource the packing and posting of orders to a fulfilment company, which takes delivery of their stock and stores it in its warehouse. During the day a call centre handles their customer enquiries.
• One that allows you to communicate with customers by email rather than by phone, so you are not limited to conventional office hours
• Don’t start a business that will be in competition with the company you work for, and don’t start one that uses information or data provided by your employer, as you will quickly run into legal issues.

Hide your entrepreneurial intentions

Downplay your entrepreneurial intentions in front of your boss. No matter how well you get on, no-one likes to feel that their employee’s attention and focus is elsewhere. Provide information solely on a ‘need to know’ basis and never bring up your business venture in conversation unless you are specifically asked about it.

Only work on your business in your spare time

Don’t give your boss any reason to clamp down on your business venture. Be scrupulous about doing your day job competently. Only work on your business in your own time and never use your employer’s resources for your business – don’t take stationery, don’t use the office phone for your business phone calls.

Social life on hold

Put your social life on hold, and try to get the support and understanding of your family – you can’t do a full-time job and start a business AND see as much of friends and family as you used to.

Maximise the number of hours

Make the most of every hour you have available to you – When Chris Orrell was starting up his company Hotelstayuk.com offering cheap hotel rooms to employees of large firms, he would go down to the car park every lunch hour to make calls to potential clients on his mobile phone. His business now has a turnover of millions.

Work on your business every hour

Don’t underestimate how much time you still have available – there are 168 hours in the week, so even allowing for a 40 hour a week full-time job and eight hours sleep a night, that still gives you a potential 88 hours left in which to work on your business.

Make sure to get some rest

But don’t sacrifice sleep. Make sure you get enough sleep every night as over tiredness will make you feel ill, run-down, grumpy, short-tempered and lead to poor judgement and bad decisions.

Advice from owners of successful spare time entrepreneurs

Janan Leo, is a typical 5-9er. During the day she works as a product development manager for Virgin Trains. As soon as she is finished there, she switches to running Cocorose, which makes folding shoes for women to wear while commuting. She started the company, which she runs from the spare room of her home in north London, in 2008 with £3,000 of savings. She works every evening from 5 pm until at least 11 pm and every weekend and now sells hundreds of pairs of shoes a month in boutiques and through her website. She may never see her boyfriend and barely get any sleep but for Leo, starting a business this way and running it at home has one huge advantage – it has minimised the financial risk. She says: ‘I lie in bed at midnight watching the orders come through on my BlackBerry.’

Steve Emecz, runs his own book company, MX Publishing, in his spare time from home while holding down a demanding full-time job as the business development director for Venda.com, an e-commerce support company. Steve, whose business publishes around 50 titles, including books on Sherlock Holmes and neurolinguistics, says: ‘I process urgent orders in my lunch break and regular ones in the evening. I have an outsourced warehouse that picks the books and ships them — it is all technology-driven and web-based. The authors all have day jobs themselves and so want to talk to me in the evening anyway, and the distributors do everything online. I have my e-mails sent directly to my BlackBerry, and I use Skype a lot.’

15. A little bit of entrepreneurial inspiration

If at this stage you’re feeling a little overloaded you should be but don’t worry every one of the worlds most successful businesses started from the smallest of to-do lists. to remind you that’s its entirely possible to do here are 10 case studies of extremely successful businesses that came from very humble beginnings.

Johnny Cupcakes

This business started by selling t-shirts, sweaters, shorts and undergarments in a bakery-themed retail shop. The initial investment was $6,700. The firm is now worth $3.8 Million. The first store opened in 2005 and the founder, Johnny Earle, soon found himself on the list of ‘ Best Entrepreneurs  25 and Under’ in 2008.

Adventure Life

Adventure Life offers group tours and vacation packages for its customers. In 2008, it had revenue of $11 Million; the start-up costs, however, were very low. These included $3,000 for brochures, $11,500 for ads in 1999 and £33,500 in 2000.

Paragon Space Development

Paragon Space, which is now worth £8 million in 2008, started with an initial investment which includes $30,000 for computers and lab equipment, £600 per month for office and lab premises, and $20,000 for yearly travel.

Chobani Yogurt

The #1 selling yoghurt in the United States was founded in 2005 by Hamdi Ulukaya. However, his ex-wife claims that he stole the recipe and paid $40,000 for it. The founder used a loan of under $1 million to buttress the initial start-up costs. The company is now worth $1.1 billion.

Sweet Leaf Tea

With its current value of $12 Million, Sweet Leaf Tea was founded in 1998 with a $100,000 initial investment. The company broke even in its third year and reported revenue of £300,000.

Tokyo Joe’s

Earning revenue of $22 Million per year, Tokyo Joe’s was started off in 1996 with an initial cost of $330,000. Tokyo Joe’s is famous for consistently bringing nutritious and delicious food to customers’ tables.

Tarte Cosmetics

Tarte Cosmetics offers a wide variety of make-up products including brushes and body products. It was established in 1999 by Maureen Kelly in New York. The start-up cost was $18,000 and now the company grosses $12 million (2008 figures).

Edible Arrangements

This company changed the way people send gifts. They specialise in fresh fruit arrangements and offer a wide variety of speciality fruit gift items and gift boxes. Tariq Farid founded this company in 1999 with an initial investment of $100,000 and the company is now worth $19.4 million.

Now worth over $200 Billion, Mark Zuckerberg started the world’s biggest social network when he was still in university. According to various reports, the idea was allegedly stolen from twins Cameron and Tyler Winklevoss who eventually sued Mark.

We have saved the best for last: ZARA. It was founded in 1975 by Amancio Ortega. The big retail giant opened up several stores across the globe. The founder’s estimated worth is reported to be $65 billion.

Now that you have made it to the end, hopefully, you’re well on your way to starting and beginning to build a successful business, good luck!

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5 Lessons for Building a Business From Scratch

When hunting for your next big business idea, embrace your personal experiences and expertise. you just might recognize an overlooked market..

By Beth Doane, an award-winning writer, speaker and entrepreneur. She is the chief executive officer of Main & Rose .

How can I build a successful brand from scratch? Is there a market opportunity right now that others are not seeing? Can I actually make money following my passion ? 

As an agency owner, I often hear questions like these when I'm advising founders and helping launch their brands. Chasing what everyone else is doing might reveal opportunities within the market, but unconventional, more personal strategies can open up untapped and unexpected potential.

The following ideas were carved out and turned into fortunes--but more importantly, they impacted lives. Here's what you can learn from them as you create yours. 

1. Create the products you want to use.

Before Yvon Chouinard was the founder of Patagonia, he was an avid climber . He and a partner started an equipment company, meticulously working to create the highest-quality outdoor gear. By 1970, it became the largest supplier of climbing hardware in the U.S.--and a perpetrator of environmental harm, since the equipment damaged rocks. This sparked Chouinard's efforts to marry innovation with ongoing efforts to protect the environment. In 2017, the company surpassed $1 billion in annual revenue and has a self-imposed Earth tax it gives to environmental nonprofits.

Channel your passion and an understanding of gaps within the market's offerings--what could you improve? But while building, don't lose sight of why you started or your values. Consumers are loyal to brands that live their promise.

2. Harness your life-changing moments.

Today, Amy Peterson is a celebrated medical aesthetician, a beloved "skin scientist." Her concept and her company, Skincare by Amy Peterson, flourished because her approach was rooted in a personal experience and a desire to help others. Her own recovery led her to try even more protocols that had never been done. She pushed boundaries--and those who do reach places others have not. Today, she helps thousands of people feel confident by treating them in new ways with innovative technology supported by exemplary customer service.

The moments that shaped you can guide you toward services or businesses that fill a vital need for others. What specific product helped you, and how can you transform and adapt that?

3. Embrace the boring.

The flashiest business ideas often get the most press. But those that are more "boring"--but crucial--often generate the most passive income. Recently, people have started purchasing businesses like laundromats, diners, vending machines, and car washes, earning mostly passive six-figure salaries. Of course, do your research to ensure it's a successful investment. The benefits of these businesses are simple. They offer many necessities and can be recession-proof. 

Look at what everyone is using every day. What places are essential aspects of our lives but tend to fly under the radar? Scooping up these services can also have a lower investment upfront and require less weekly work, making them a more accessible way of generating passive income.

4. Transform a nuanced experience into an accessible product.

If you don't know Andy Puddicombe's name, you probably know his voice. He guides meditations on Headspace, an app he created with Richard Pierson. Now, it has more than 70 million users, a Netflix series, and partnerships with companies like Starbucks and Unilever. In his early 20s, Puddicombe experienced a string of tragic deaths that led him to leave behind a sports science degree to spend 10 years as a Buddhist monk. When he returned to London, a meditation business eventually grew into Headspace, which boiled down meditations into 10-minute chunks, helping busy professionals build mindfulness practices into their lives.

Your niche knowledge could be worth a fortune. Puddicombe wasn't always planning to build an app, but the decision helped launch a mindfulness industry.

5. Look at the full life cycle.

People often focus on the exciting possibilities of new technology--most aren't thinking about what happens when that technology is thrown away. When we scrap old electronics, billions of dollars of precious materials become waste. The e-waste management market is expected to hit $143.87 billion by 2028.   Harvesting and recycling electronics are becoming increasingly crucial for our environment. As the world continues to adopt electronic vehicles, we need more batteries--exacerbating the demand for precious metals. 

Paying attention to the parts of the life cycle that others aren't can yield lucrative new opportunities. 

Building a business requires passion and sometimes an unconventional approach. Consider embracing personal experiences and expertise and recognizing overlooked market aspects to find success.

The Daily Digest for Entrepreneurs and Business Leaders

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Create consistent and relevant interactions with your customers through regular blog posts of articles, infographics and videos.

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Offer attractive savings to your customers by dollar amount, percentage amount or even through shipping deals.

Any theme you choose from Shopify can be integrated with major social media sites so your customers can share your online store with their personal networks.

Powerful email marketing

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Detailed analytics

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We help you easily track your progress over time so you can make better business decisions in the long run.

Enter the mobile marketplace

On-the-go customers.

For those customers who are always on the go, your Shopify plan includes a free, built-in shopping cart for mobile commerce. Your customers can browse and make purchases from their mobile phones no matter where they are.

Eye-catching mobile themes

You want your website to look just as good on a mobile phone & tablet as it does on a desktop.

Choose from a wide selection of free and premium professionally designed ecommerce templates in the Shopify Theme Store .

Be a mobile business owner

Manage your store right from your mobile when you’re out of the office.

Through your iOS device you can see product details, orders, customer data and even sales statistics.

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Shopify’s customer service standards are high. We’re constantly checking in on how we’re doing by asking you to rate your experience after every interaction you have with us. Check out our ratings today!

Helpful tutorials

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Get answers fast

Visit the Shopify Help Center to find detailed, step-by-step answers to frequently asked questions.

Theme & API assistance

Get all the information you need on Shopify’s templating langauge, Liquid , and APIs for app development.

This documentation is thorough and includes illustrative examples that make it easy to follow along.

Open discussion

Connect with other Shopify users anytime to discuss everything from selecting a theme or integrating a payment gateway, to developing marketing strategies and optimizing your online store.

Learn more about starting an online store

Create an online store with just a few steps:

• Choose an ecommerce platform
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You can set up and start selling from your online store with Shopify in a matter of minutes. Sign up for the free trial, launch with one of the available themes and templates, and you’re ready to make your first sale.

Shopify has different pricing tiers for each of their plans, starting at $9.00 USD /month. Here’s how it breaks down:

• Shopify Lite: $9.00 USD /month; 2.4% for in-person transactions
• Basic Shopify: $29.00 USD /month billed yearly; 2.9% + 30¢ for online transactions; 2.7% for in-person transactions
• Shopify: $79.00 USD /month billed yearly; 2.6% + 30¢ for online transactions; 2.5% for in-person transactions
• Advanced Shopify: $299.00 USD /month billed yearly; 2.4% + 30¢ for online transactions; 2.4% for in-person transactions

Shopify POS Pro is available as an add-on for an additional $89/month.

Shopify includes all website hosting, so there are no additional hosting fees. All plans offer a 3-day free trial.

If you want to be successful in ecommerce, you should sell products that meet a consumer demand and generate healthy profit margins. For entrepreneurs just starting out with selling online, you can try print-on-demand products or dropshipping. Both of these options require little risk, as a third party handles inventory and fulfilment for you.

Yes, when you build your online store on Shopify, it will be optimized for mobile users. The Shopify Theme Store has tons of great free and premium mobile themes. Every Shopify theme comes with a free mobile commerce checkout so your customers can purchase from anywhere.

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More From Forbes

What mindsets can help you create a new business from scratch.

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Bekhruz Nagzibekov, Founder and Owner of United HVAC, Plumbing & Electrical .

Have you ever dreamed of starting your own business? Many find the prospect of starting their own business daunting, often giving up at the first sign of difficulty. Yet, I've come to realize that challenges are simply growth opportunities.

Drawing from my own personal experiences, I want to offer insights on how to build a business from scratch. Through my journey of trial and error, I've come to believe that each of us is capable of achieving success when we embrace challenges with determination and perseverance.

Five Principles For Success

I was born in Tajikistan when it was still part of the former USSR. Our peaceful and tranquil life took a turn after the collapse of the Soviet Union. A war began in the republic, and my family and I had to leave everything we knew behind and flee to Moscow, Russia. During that period in Russia, the business culture was in its nascent stages, and the concepts of individual agency and opportunity were just emerging.

When I moved to the U.S. in 2016, my family and I had to start our lives over once again, learning new things and adapting. I recognized the need to continuously strive for progress, and I took on a new challenge: to create not just another company, but also a comfortable environment for the development and adaptation of immigrants such as I was upon my arrival in the United States.

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So, what do you need to keep in mind when creating a new business from scratch? Here are a few key principles I've learned that can help regardless of where your starting point is.

1. It's a marathon, not a sprint.

Building a successful business requires consistent effort, energy and investment of resources over time. While the results may not be immediate, patience and perseverance are important to eventual success. One of the keys to achieving long-term success is to have a solid plan in place. This means setting clear goals and objectives and developing a roadmap for achieving them. It also means being flexible and adaptable, willing to make adjustments as you go along.

2. Pursue what you love.

When you're passionate about your work, challenges can become opportunities for growth rather than obstacles. Just like in martial arts, where taking hits is part of the journey, passion can help you endure setbacks and keep pushing forward. If you find yourself constantly viewing challenges as problems, it may be a sign that you're in the wrong role. Doing what you love can help turn challenges into tasks, each one bringing you closer to your goals.

3. Find your niche.

When looking at possible niches you can fit into, choose a direction with high demand that also fits with your experience and skills. I recommend the following five steps to find the best business niche for you: Identify your interests and passions, research market demand, assess the competition, evaluate profitability and test your idea.

When I first came to the U.S., I worked for someone else, but I was already thinking about the niche in which to start my own business. I found that manual labor is highly valued in the U.S., which is not the case in Eastern Europe or Central Asia, and that the construction industry in California was an almost win-win business niche. Construction is a virtually unlimited field for the development of services and business expansion in related areas. That is where my plumbing activity began, leading to my successful business today.

4. “Give a lot and at once, getting a little and gradually.”

Let’s take a look at this saying from another angle. When we first start working or open our business, we strive for maximum wages or profits. But what if I told you that this approach doesn’t always work?

Instead of insisting on high demands from the very beginning, let’s look at the situation differently. Why not start by ensuring your actions exceed expectations? Become that employee or business leader who goes above and beyond what is expected of them. I've found that when you stand out, you get attention. And that attention can sometimes lead to getting you more generous pay or a faster promotion—or, in this case, more public attention and customers for your new business. When you build your reputation as a reliable and dedicated professional, you should soon see your hard work begin to pay off.

5. Believe in success.

When you decide to move up and develop your business, you may find yourself surrounded by people who will try to dissuade you from the idea of your projects. They may try to convince you that nothing will work out, that you’ll just waste your time and energy. After all, it is always easier to complain about life and devalue the successes of others, attributing them to good luck. And if you allow yourself to believe that, as well, you will likely find yourself in a self-fulfilling prophecy of failure.

It is important to approach your business with the firm belief that "success” is not some unattainable goal based on good luck and fate but rather the result of hard work. And by persevering and believing that success is possible, you can show those coming from your same environment that it is possible for them to reach their goals, as well.

Final Thoughts

In my own journey, I reached a point where it would have been possible to receive passive income sufficient for a quiet and comfortable life, letting experienced managers manage the company. But my ambitions don’t allow me to calm down and live a relaxed life. I believe that happiness and satisfaction don’t come only from materialistic achievements, and the true purpose of life is to create something meaningful, to help others, to be useful to this world and to contribute to its development. As you create your business, don't put a limit on what you can achieve; instead, continue to build on your successes.

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