How2Day: Business Startup Basics

Understand the basics of starting a business before you open your own company. B2M Productions/Polka Dot/Getty Images
The process of becoming an entrepreneur and starting your own business can be intimidating. By following business startup basics, you can focus your money and time on activities that will help you get your business off the ground, according to business expert Tom Taulli writing for the New York Times website. Understanding the startup process can remove some of the stress involved in running your own business.

Every successful business starts with a comprehensive business plan. Your business plan should outline the kind of business you want to start, your sales projections, marketing approach, expansion plans and revenue expectations for the first three years of your business. Not only will your business plan serve as your blueprint for starting and running your company, but it will also be necessary in getting investors and lenders interested in helping you fund your startup, according to the U.S. Small Business Administration. As you start your business, be sure to update your business plan regularly to reflect the changes in your business such as new products or a change in management and how you intend to respond to changes in your industry.

Along with establishing a company you can believe in and creating a functional business plan, you're required to create a legal structure for you business. You will need to determine if you want to be a sole proprietorship or partnership, and if you will want to incorporate, according to Taulli. A sole proprietorship will allow you to maintain complete control over the organization, but it may be easier to bring in investors as partners rather than run the company on your own. Incorporating your business can help eliminate your personal liability should the company get sued but creating a corporation requires the services of an attorney and an accountant, which get be expensive. Discuss your options with an attorney to see which of the legal structures best suits your company.

You will not be able to get your business off the ground without financing. Check into your personal finances to see how much of your startup you can fund from your personal savings, current full-time job and personal loans. Check with local lenders to see which ones participate in the SBA loan program. Then make personal appointments to speak with each lender to determine which one you want to do business with. The SBA does not grant loans but rather it authorizes certain lenders to administer the loans and then guarantees 80 percent the loan, according to the SBA website. An SBA loan may be the ideal way to fund your new business venture when you are finding it difficult to get a traditional bank loan.

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