4 Requirements You Must Fulfill When You Start a Business
When you start a business, there are several requirements you must fulfill before your dream comes to fruition. Your preparations would consist of selecting a company name; creating a business plan; addressing structural issues; and overseeing accounting and legal matters.
Requirement #1 When You Start a Business: Selecting a Company Name
This is one of the first things you must do before registering your business. Many philosophies exist regarding company names. Some people believe that a business’ name should reflect the products and services that customers will receive. Such beliefs has not always been valid. There are companies that did not follow these rules, and they’ve turned out to be successful despite their names. On the other hand, there are companies that adopted the relevancy strategy of naming their companies and their business didn’t evolve as expected. If you’re unable to find a name, you can move forward with other aspects of your business planning. As you go through each phase of business development, you may come up with ideas. Even if you choose a name for your company that no longer serves its purpose, you can always change the name after you start your business. It’s recommended that you make name changes at the inception of the business. This approach can prevent possible mix ups with your customers who may be searching for the initial company name only to discover that the said name is no longer in existence.
Requirement #2: Creating a Business Plan
Before creating your business plan, you must gather the information required during the planning phase. If you’re not the only person in the business, you must include your business partners in the planning session. This will educate them on their respective functions and other aspects of the business. Any questions or concerns can be addressed during this phase before developing the business plan. Once all aspects of planning have been covered, you can convert your discussions into a business plan. The core components of your plan should consist of an executive summary, product/service description, market research, competition, sales and marketing, management team, opportunities and risks, and financial projections. Remember that your initial business plan may change several times to incorporate new information.
Requirement #3: Structural Issues
You’ll have to invest in staffing when you start a business.
Determine the skillsets you require for the positions available. Depending on your budget, you may have to carry out several roles until you’re in a financial position to hire employees. Identify your strengths and assume a position that will allow you to shine. During the initial stage of your business, you should not hire high-salaried employees. Such choices may lead to your company’s early demise. If your company has partners, make sure that each person is knowledgeable about his/her role and has the ability to function in that position.
Requirement #5: Accounting and Legal Matters
Having the right person in charge of your accounting affairs is critical to your business’ growth. At the beginning, when you start a business, you can use accounting software such as Quickbooks to manage the books of your business. With the growth of your company, you can hire a senior bookkeeper, accountant, or finance manager. While it’s essential to maintain proper accounting records, it’s equally beneficial to have a group of lawyers to advise you in different areas of your business.
To start a business requires much more than the know-how, you must be capable of executing your business plan.