At InsuranceBee, we provide insurance coverage to a number of businesses who are just starting out.
As we begin a new year, we chatted to some of the great mentors at SCORE to get some expert advice on how to kickstart your startup.
Michael Sarka, a SCORE Counselor with a great deal of experience in developing business plans, offered a wealth of information and resources to help startups:
“One key to the success in the development of any venture, is preparing a Business Plan (BP). This is a most important planning tool and worth the effort to develop.
Here are some useful sources about developing a Business Plan:
Business Plan Overview – SBA
Master Your Business Plan
Developing a Business Plan
Another key in developing a new business is choosing the best Business Structure, thus the following will provide information on the varied available structures:
Business Ownership Options
Choose Your Business Structure
Sole Proprietorship Basics
The sole proprietorship is the simplest legal structure for owning your own business.
How to Form an LLC
Here’s what you need to do to form a limited liability company.
How to Form a Corporation
To form your own corporation, you must take these essential steps.
Corporations and S Corporations vs. LLCs
How do you know whether incorporating or forming an LLC is right for your business?
Another important consideration for the business plan is thinking about the value of your product or service, and why someone would choose you over the competition.
Marvin Brook, a SCORE Counselor who teaches seminars on writing effective business plans gave the following advice:
“One thing I always say to someone who is starting a small business is this. Ask yourself why a potential customer would choose your product/service instead of the competitions. Too many people only see their product/service through their own lens and fail to have empathy with their customers. It is a tough competitive world and if your clients cannot really see a value-added reason for people to choose their product, then they should revisit the idea.”
He also emphasized the importance of having a robust financial plan in place within the business plan:
“Without getting into the details about what a business plan should contain etc., the best tip I can give someone is to understand the financials of your business idea. This is especially difficult for a new venture because of the lack of data to support the cash flows, balance sheets, and income statements that need to be created. A key to good cash flows is making a realistic projection on sales as well as coming up with a proper price.”
Marvin added: “To properly price, there must be an understanding of fixed and variable costs along with a clear idea of how much income/profit the business needs to make. At the end of the day, the new business venture needs to be able to provide an excellent product/service that meets a customer need at a competitive price that ultimately provides the business with sufficient cash flow/income to continue to exist. There are many more complexities that can be added to this simple proposition but you must meet this simple business requirement no matter how elaborate a business plan you create.”
If you’re not already aware of SCORE, they are a nonprofit organization with a huge network of mentors who are available to help small business owners, as well as providing workshops and resources for budding entrepreneurs across all industries.