Maybe you've been job hunting for several months, or you're just generally dissatisfied with your work situation. Rather than feeling bad about yourself or resentful at your current employer, it might be time to think seriously about starting your own business. This doesn't mean quitting your current job, if you have one; many professionals have side businesses that let them earn additional money while focusing on the work they most enjoy. If you're unemployed or under-employed and this sounds good to you, here are some tips from the best and brightest small business experts and entrepreneurs to get you started:
You can't really jump-start anything until you understand and can explain to others the product or service you want to offer. You should be good at it and enjoy doing it, and you should be able to discuss it with enthusiasm and conviction.
Next, get your business registered with the state. If you're working on your own without employees, you can declare yourself as a sole proprietor, according to the Small Business Administration (SBA). You still have to pay taxes and obtain licenses and permits. If you have a business name, register this as well to prevent others from using it. Consider becoming an LLC (limited liability corporation), which the SBA recommends to protect your personal assets and receive some tax advantages.
If you decide to become an LLC, contact the IRS and request an employer ID number (EIN). This identifies your business as a separate entity from you and your Social Security Number. Sole proprietors may need one as well, depending on the financial situations stipulated by the IRS.
The (Ugh) Business Plan
Tory Johnson is known to many as the "Deals for Steals" reporter on ABC's "Good Morning America." Her primary work, however, is assisting entrepreneurs and small business owners. The business plan, she says, is where a lot of would-be small businesspeople get tripped up and scared off.
Johnson is not a fan of the large, complex business plans, particularly for those who are just getting started. She offers a simpler, single-page business plan template that's a lot less worrisome. It does require some forethought that will, in the end, help you focus the business. Even if you can't answer all the questions at once, at least you will know where you need to put in some work.
Small business owners can have a hard time getting financingâ€”and sole proprietors even more so. Look for ways you can raise the capital to get started. Do you have a savings account that isn't earning much interest for you? It may be more valuable to invest it in necessary equipment. If you receive regular payments from an annuity or structured settlement, you may be better off selling your future payments for a lump sum of cash now that you could use to help launch your business.
You can also look to crowdfunding and crowdsourcing, which have become popular in recent years. Crowdfunding lets you solicit funds through networking online, while crowdsourcing lets you get assistance and ideasâ€”but not necessarily financial helpâ€”from experts. Of course, you could always apply for a small business loan through the SBA, too.
No matter which funding route you go with, aim to keep your costs low, particularly in the early stages.
Category: Starting and building a business