In some cases, coming up with the idea or business concept may be the hardest part. It’s not necessarily important why you’ve made the decision to be an entrepreneur, but rather what you intend on doing with it. Here are five steps to get you on the right path.
1. Build a Business Plan
A business plan will help you define the structure of your business as well as help get your business advisors—accountants, lawyers, bankers—on your side. Consider it the roadmap to your destination (a thriving business). Business plans help define what your business is and how it will operate.
Define the structure of your business with this business plan template.
2. Research Your Market
Do your due diligence by researching your local market. Is there a need for your product or service? Who will you be selling to? Where are your potential customers located? Are there competitors in the area? Market research will help you identify any obstacles that could impede your success.
3. Register Your Business
Once you have determined your business idea could thrive in your market, you’ll need to register your business with the right government agencies. In addition to paying taxes and fulfilling rules and regulations, registering your business creates a sense of legitimacy and credibility.
4. Know Your Financials
Creating financials will help you identify the initial start-up costs such as business licenses, equipment, inventory, office or store front and marketing costs. Ongoing financials will help you manage your cash flow and keep you on track to success.
Identify your initial start-up costs using this calculator.
5. Create a Cash Flow Forecast
Building off of early financial documents, cash flow forecasts help you to manage cash flow and help you to meet immediate and future needs. Consider using accounting and invoicing software to keep track of money coming in and going out of your business.
Your idea was just the beginning. Following the five easy steps above can keep you on track to move from dream to successful business venture.
For more tips and resources on starting a business, download this helpful guide: RBC Starting Your Business Guide.
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This article is intended as general information only and is not to be relied upon as constituting legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. Information presented is believed to be factual and up-to-date but we do not guarantee its accuracy and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the authors as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by Royal Bank of Canada or any of its affiliates.
