Intro to Business Unit 4 Current Businesses

Unit 4: Current Businesses Businesses begin with only an idea and develop into small businesses. There are millions of small businesses in the U.S. currently. Small businesses are independent businesses with 200 or fewer employees. Some small businesses may stand strong or fall, and if they do stand, they may become a franchise as well. Small businesses ● The owner is typically the manager of a small business. ● The business will most likely operate in one or very few locations. ● Typically will serve a smaller market. Steps in starting a small business: 1. Do your research ○ Look realistically and question yourself if your product will succeed in the market or not. ○ Is there a need for your product? ○ Take a look at neighboring competitions from other businesses. 2. Make a plan ○ Create a business plan for your company. i. in your blueprint, draw your business from the start-up phase to establishment, and growth. 3. Plan your finances ○ Plan for the numerous expenses that you will encounter. ○ Map out in a spreadsheet how much money you may need to cover your expenses for 1 year. i. license, equipment, legal, insurance, marketing...etc. 4. Choose a business structure ○ There are different business structures that you can choose from. i. sole proprietor: a business owned and run by only one person. ii. partnership: a separate legal entity formed by document files with your state. iii. limited liability company: a business structure where the owner is not personally responsible for any liability or debts. 5. Pick and register your business name ○ The business name is very important, hence you should pick a meaningful and good one. ○ Check whether it is trademarked or not. i. if not, then register it. 6. Get a license and a permit ○ Different licenses and permits may apply depending on the type of business it is. ○ Research the licenses and permits during the start-up process. 7. Choose your accounting system ○ The accounting system is one of the most important systems for a small business. ○ Keep a stable system in place when starting your small business. i. creates and manages your budget, files tax, sets your rate and prices, conducts businesses with others. 8. Set up your business location ○ Think about location, equipment, and set up when deciding on a location. ○ You can have a home office or a retail office for your small business. ○ Determine whether you want to buy or lease your commercial space. 9. Get your team ready ○ Outline the positions that really need to be filled, and higher trustworthy people. ○ You may need a support team if an entrepreneur. 10. Promote your small business ○ Write a USP and create a marketing plan. i. refer to the marketing plan unit for more information. ○ Find ways to promote your business online, and in-person. Finances Types of finances: ● Start-up finances ● Short-term finances ● Long-term finances ● Owner supplied funds ● Borrowed funds Short-Term Start-Up Long Money to pay for current Purchase of the equipment to Large amounts of money paid operating costs of the open up the business by over several years Financing that is obtained for Money used to open up the The land that the business is less than one year business built on business X The license needed to operate a business X The reasons for failure ● Not keeping adequate records. ● Not having enough start-up money. ● Lack of management and experience. ● Lack of experience with the type of business. ● Not controlling operating expenses. ● Poor location for the business. Small Business Assistance ● Local groups of business people. ○ Local events. ○ Working together to advertise each other’s businesses. ● Small Business Administration (SBA). ○ The government-run program that helps small businesses develop business plans and obtain financial support and fundings.