If you need some pointers on what kind of business to open, check the Business Ideas section.
Choosing a Name [NEW]
Planning Your Business
Function of a Business Plan
Research
Plan Outline
Finding a Mentor
Raising Money
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While choosing a name can be an enjoyable and creative aspect of starting a business, its importance should not be underestimated. Names evoke images and feelings among potential clients. Your job is to make sure the association is a positive and accurate reflection of your company.
Snowflake Factor
Your name should be as unique as you and your company. Standing out is pivotal, but don’t sacrifice comprehensibility for something off the wall. Names should be easy to read and pronounce, eliminating any confusion. Try not to make the name too obscure; it should tie back to the values, products, or other traits of your company.
Myra's Magical Muffins
The drawback to naming your business after yourself could come much further down the road. There’s the possibility that after you work your entrepreneurial magic someone will want to purchase your company. In this case the buyer might be put off by a name that is not their own. On the upside, a small, personal service would benefit from the intimate image created by putting a face to the business.
You may notice that after reading this hypothetical name you already have a good idea of what this business offers. Words that highlight an important aspect of your company often work well in your title. Leaving clients with an automatic impression of what you’re selling is a good way to gain interest.
Know Your Audience
If your client base consists mostly of 40-50 year old females a name containing a common gaming term may be witty but not well aimed. A youth based audience may recognize terms that older crowds might not, and vice versa. Make sure your name is appropriate for your demographic.
Brand names are an ingrained part of our world. A short look around can prove that many extremely successful brand names do not follow any rules or obvious logic. It comes down to the decision of you and your partners but choose carefully; there’s a lot riding on it.
Registering
Unless you’ve chosen your name to be the name of your company, you will need to register your dba (doing business as) with your county. This will also keep other businesses in your area from adopting a confusingly similar name. You can register your name on a larger scale by looking into trademarks.
By now you should have a good grasp on what kind of business you are preparing to open. You’ve spent time thinking out your idea in detail and consulted friends, family, and professional acquaintances for their opinions and advice on your proposal. You have faith in your idea and are ready to figure out the specifics. This is where a business plan comes into play.
Once completed, your plan will explain your business goals, why you believe them to be attainable, and how you will achieve them. Here is where research and lots of number crunching come in. Business plans are especially important if you intend to approach investors, banks, or other organizations for loans. Your plan should prove that you will be able to (realistically) make enough profit to repay these sources, otherwise you are likely to be turned away.
Starting to sound a little too much like school? Don't worry, it's pretty simple.
A good starting point is to carefully analyze businesses similar to yours in your area and outside of it. How much do they charge? How much business do they get? What kind of marketing do they use? Snoop around and get as much information as you can using the internet and staking out other local businesses. Use these results to pin-point your prices, clients, and competition. Another set of invaluable tools provided by the internet are cost calculators. These can help you figure out how much it will cost to start your business, to run your business, and how much profit you can expect. See the Resources page for details and links.
A very basic business plan would look something like this:
I. Cover sheet.
This will serve as your title page.
It should contain the contact information (name, address, phone number) for both the business and the owner(s).
Don’t forget to include the date.
II. Introduction
Use this space to provide background information on the company and the owners, including their assets and duties.
Briefly describe your short and long term goals, as well as how you plan to achieve them.
Address the strengths and weaknesses of your company.
III. Marketing
List the services you offer, including ideas you would like to implement in the future.
Explain the demand for your product/services.
Identify your market and how large it is.
How do you plan on advertising? (For help see Marketing) How much will you spend on marketing/advertisement?
Explain your pricing plan.
IV. Financial Management
Describe the source of start-up funds and address how much you will need.
Create a monthly budget and monthly cash flow for the first year.
Appoint an accountant and explain how your books will be kept.
Include expected return on investment for the first year.
Discuss what needs to happen in order to break even.
Provide alternate options in case any problems arise.
V. Operations
Give details of day-to-day business practices.
Address insurance or rental agreements if applicable.
Account for necessary equipment, as well as production and delivery.
Describe hiring procedures.
If you have any patents, trademarks, or copyrights, include them here.
You can include as much or as little as you like in your business plan. Remember that a business plan is not set in stone; it can be rearranged according to changes in your company.
Do I Need a Mentor?
Mentors play a part in many aspects of life. You may still ask a close former teacher for advice on college papers or your future in education. They would provide you with all the help they could, free of charge, out of desire to see you succeed. Your business mentor should be the same way.
Finding a Mentor
Finding a mentor can be tricky. It should be someone you trust who has more experience than you in the field of business you are entering. If there’s a locally owned store that you frequent and enjoy, try to contact the owner and ask if there’s a time the two of you could sit down and talk. The internet is also a huge resource for finding mentors, you can find links at the bottom of this section.
Once you’ve secured a knowledgeable source that’s willing to meet with you, think about what questions you have for them. If there’s one thing you don’t want to do, its waste a busy person’s time. Write out your answers bring them with you, then take notes on key information you need to remember.
Don’t worry if it takes you a few tries to find someone who’s a good fit for your needs. The relationship you form with a mentor can follow you for the duration of your career and turn into a great friendship. Remember to view anyone you meet as another branch on your network, whether or not you choose them as your mentor.
Score.org – Service Core of Retired Executives, hosts over 11,500 volunteers willing to give you advice on almost any aspect of business.
Business Mentors Can Change Young Lives – Pacific Business News article on the usefulness of mentors for emerging businesspeople.
Retire@21 Mentors – Small but personal database of volunteer mentors.
For a young person attempting to open a business, money can be hard to come by. Initially your business should have as few costs as possible. The most viable means of attaining funds is to either approach friends and family with an impressive business plan, or get a job.
Making It Happen
Before asking anyone for start-up money be sure you can convincingly pitch your business. If your goals and ideas are vague, implausible, or confusing, it’s very unlikely that even the nicest of grandmas will break out her wallet. Impress family friends like you would a potential business partner or customer; make them believe in you and your company
If you’re unlucky in fundraising you might have to bite the bullet and get a job. Open a savings account and begin putting your earnings away. It’s obviously up to you how little or how much you want to work and save. You can go part time and continue developing your business, or spend less time on your start up and save more money in a shorter period of time.
Once your company starts to grow, you can think about attempting to secure a loan. You should wait until you’re sure your business has the ability to generate enough profit to pay the bank back, especially since you (and possibly your parents) will sign for it, and I doubt they want to get stuck with the bill (or bad credit) for your unsuccessful venture.
Next: Marketing
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