Small businesses are an essential part of the American economy.
According to the U.S. Small Business Administration, there are 28 million small businesses across the country accounting for 54 percent of all sales transactions. Not only can you provide a service to customers, but employees also benefit because approximately 8 million individuals work for small businesses.
If you've been sitting on an idea, whether you've just graduated college or have been in the workforce for years, you have numerous resources at your disposal to help open a new coffee shop or hair salon. Rest assured, there is help you can find every step of the way.
Part of this stems from the fact that you can lean on how other small businesses operated and learn from them. You can examine what worked and what didn't. Doing so can help your business succeed well into the future.
Here are some important financial steps to take as you start your first small business to ensure your new venture is successful.
Write a business plan
Once you've come up with an idea, you need to start the process of writing a business plan. The SBA recommends this document contains an executive summary, details your executive leadership and overall, provides an overview of business goals and how you plan to achieve them.
You will need to provide detailed analysis of the market. For example, conduct research on competition, growth rates, various trends and the needs of your customers.
After that section, you'll want to place an important emphasis on funding requests and financial projections.
Finance your business
Your funding can come from a variety of sources, such as personal savings or investments from friends and family. Many small business owners, however, choose to take out a loan through special government programs, or from their local bank.
The most popular option is the 7(a) Loan Program. Your business will have to meet some requirements, such as being classified as small and demonstrating a need for loans, among others.
You can also look into microloans, up to $50,000. You can use these loans to either get your business started, or after a few years, expand. The average SBA microloan is $13,000, the SBA stated.
No small business is complete without the necessary equipment. From computers to cash registers to general supplies, you will need the equipment to help ensure your business runs efficiently.
To obtain any equipment you may need, you can also take out a loan. There are even potential tax incentives that encourage you to upgrade equipment on a regular basis. As a small business owner, you can talk with Landmark Bank's business banking professionals to create a customized loan specifically for your needs.
Market to build a customer base
Throughout the process of starting your new business, you'll also want to be working on a marketing plan to attract and build a reliable customer base. While it will involve a lot of leg work, Entrepreneur said there are plenty of ways you can market your business without going over budget.
"Talk with business banking professionals to discuss your business plans."
Emails and digital advertisements should be high on your marketing list. Today, many customers prefer to receive information via email. Additionally, email campaigns will also net your new business a healthy return on investment.
Utilization of social media is also an important part of today's marketing environment. While most of the popular services are free, you may want to consider setting aside money for sponsored advertising. Doing so will help expose your small business to thousands of potential customers that will help increase web traffic, sales and popularity online.
As you begin the process of starting and owning a small business, you must remember the important financial steps. From creating a business plan that includes market analysis to strategically marketing to an online audience and securing funding, every step is important.
Don't hesitate to talk with business banking professionals to discuss your business plans in further detail. They will help you find the right source of funding to help make your dreams of owning a business come true.
For more information about how you can grow your business, contact Landmark Bank.
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