How to Start a Small Business

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Miroslav Ilianov Dzharnavliev, Finance, group – 16, Fac. № 9969

How to start a small business

Firstly, in order to start a business will need to choose or create a business idea. While this is an obvious step many people who want their own business don't have an idea, just the desire to be an entrepreneur. For a new entrepreneur, there are many options: buying a franchise or an existing business, or looking to others for ideas for a start-up business. Once you have decided on the business you wish to start, then the real work begins. Secondly, writing a business plan is the next and most important step, this is how you and others will evaluate your business. When seeking financing the investors or lenders will want to read your plan before they supply you with funding. If you're financing the business yourself, you will still want to have a written plan to develop business strategies and financial projections. A key element within the business plan is the marketing plan, which explains marketing strategies that will be used to advertise and promote the products or services. The goal setting steps of the plan will help you to analyze the success of the business in future years and clearly illustrate the capital needed to operate the company to break-even. With the business plan in hand, you are ready to go find yourself some capital. Most small businesses have three options for financing: friends & family, investors or bank loans. Each of these options has different considerations for the business. Investors and even friends and family usually want ownership and control of their portion of the business. Bank loans burden the business with an additional expense of the loan payment, which can erode the business profits. As you get the needed money, the business plan and the enthusiasm you should choose a legel structure – sole proprietorship, partnership or cooperation. Your financing decisions will have an effect on what legal structure you...
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