How to start a business with no money

One of the major questions today is how to start a business successfully. The process of starting a business requires careful and rational decisions in order to build a successful and long lasting one. Starting a business requires a lot of preparation which will includes financial and non-financial resources. In order to successfully start and run a business, there is a need for the prospective businessman or woman to be flexible adapting to new changes that takes place overtime in the sector.

This post is for every individual and entrepreneur who are willing to start a business as starting a business involves rigorous planning, making necessary key financial decisions and fulfilling necessary legal activities. Some of the steps to starting a business include:

Conduct a research and gather necessary information

One of the important steps to take before starting any business is to carry out a deep research and have proper understanding of the business plan. The research you are carrying will expose you to the opportunities and threats in the business you are trying to start. The success or failure of any business is mostly determined by the quality of research behind the business idea. You can start your research by searching for a societal problem and devising means to provide solutions to such problems on a profitable level. Having business research will give more information about the SWOT (strength, weakness, opportunities and threats) available in your proposed area of specialization, the size of potential customers and competitor’s information.

Formulate your business plan

A business plan is the written framework of your business. Business plans are very helpful when starting a business. Apart from the numerous business information available in it, it will also help you in raising funds for your business from business investors, family and friends, banks, etc. The business plan must include the name, mission and vison of the business.

The mission of your business is your goals and objectives in the short run while the vison is the goals and objectives for your business in the long run. Your mission is pivotal to your vision. Let say your vision is to be largest exporter of automobiles in the world, your mission will include goals and objectives that will enable the achievement of that vision. Apart from the mission and vision, the business will include all the necessary marketing, financial and technical information that will make the business run successfully.  

It is the foundation of your business therefore a necessity and a must-have for every business before starting it. The business plan is a roadmap and guide on how you are going to structure, grow and run your infant business to success.

Gather financial resources

Almost all businesses require finance when starting them except it is an intellectual business such as writing a book which require physical and mental resources mostly. Finance (Money) is the blood of a business. Without adequate finances, the live of a business will be short. Many challenges in business are managed with finance. Before you start, you should have an estimated of the needed finances for the business in your business plan and note how you intend to raise the funds for your business. You can obtain finances/funds for your business through personal savings, borrowings, bank loans, trade credit, crowdfunding, etc. It is always advisable that 70% of the business funds be provided by you through personal savings in order to reduce the interest rate and debt profile attached with other means of financing a business. 

Select a favorable business location

Many businesses failed to live to its expectation due to selection of unfavorable business location when selecting one for the business. The business location that you choose will go a long way to determine the opportunities that will available to such business. Make sure you identify the best location for your business before establishment as it is difficult moving a business with physical structure which cost a lot of finances. The type of location you choose can greatly affect your business requirements as well. As a new business, select the best or favorable location is one of the best business decisions ever you can make as this will lead to an increase in business acknowledgement and profitability.

Fulfill all legal requirements

All countries in the world have their laws, rules and regulations that is associated with the registration of a new business and are mostly distinct from each other. For instance, the requirement for starting a business in Australia is different from that of the United States. Make sure your business research cut across the necessary legal requirements of a business in any location you want it established in. The legal requirements will also include the tax information and payments, licenses and permit approvals and many others thing as stated by the country business registration and monitoring agency established by the government.

Business accounts and records

The business entity concept is one of the most applied accounting concepts in any business. The concept states that the business irrespective of its size is a separate entity and distinct from the owner/owners therefore their accounts must be treated differently. You shouldn’t associate your personal account with your business in order to make the preparation of your financial records easy and also give a clearer view of the business profit or loss. One of the ways to ensure this is the opening of a business account for your business at the bank and also the preparation of financial records including the expenses of the business in another record totally different from that of the business owners.

Having a business account and financial records will help you in handling all legal, tax and daily issues relating to the business without confusion. Make sure you get your business account and financial records ready when starting a business.

Risk Management

We are faced with different types of risk on daily basis. When starting a business, you should take note and provide some protections against business risks. Many of the risks facing a business are insurable therefore you can take up a form at a recognized and trustworthy insurance to protect your business against unforeseen circumstances e.g fire, cargo accidents and many other types of insurance for business. Note that you can’t totally avoid risks but can only reduce it. Therefore, ensure you take all necessary form of risk control and reduction.

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