How To Start a Business

Being your own boss starts with the decision to make the big leap.

If you’ve found us here, you’ve already taken that crucial first step. Congratulations! Now you’re ready to learn how to start a business from scratch. But where do you begin?

Whether you already have a brilliant product idea or you’re just looking to build a future on your own terms, you’re in the right place.

It all begins with an idea. To narrow in on that idea, it’s important to know what kind of business and lifestyle you want to have. Are you looking to sell existing products as a low-lift side gig? Do you want to go all in on an invention that will change the world? Or is your social media audience the perfect place to launch your personal brand’s merch?

If you’re stuck, start with our big lists of low investment business ideas, online business ideas, and popular business opportunities to get inspired. Next you’ll decide how to bring that new business idea to life: make, manufacture, or resell?

Now that you have a killer idea, it’s time to validate it! Your product or business idea may excite you, but it’s only worth pursuing if there’s an audience (a.k.a. future customers) looking for it.

There are many ways to do your research upfront before you start investing. You can look for gaps in the market, find an underserved audience, run a focus group, and investigate your competition.

Finding a target audience

Your target audience or target market refers to a group of potential customers for your brand. This is the group you’ll eventually aim all your marketing efforts and dollars toward. As a result, it’s critical to define them as thoroughly as possible.

Building buyer personas is an effective method for drilling down into your ideal customers’ needs. How old are they? What do they love? On which social media platforms do they spend most of their time? What’s important to them?

Conducting market research

Market research is the process of gathering data about the potential customers (or “market”) for your brand. It can validate that you’re on the right track or inform you that you need to make a shift. You can conduct market research through surveys, focus groups, and interviews.

Market analysis is a similar concept but involves researching the industry as a whole, combining insights you get directly from your target audience with third-party sources like reports and industry publications.

Analyzing the competition

Understanding the competitive landscape can ensure that you’re setting your brand apart in the industry. This exercise will also help you clearly define your unique selling proposition (USP), which is the benefit that your product offers over that of your competitors. Explore the in-depth resources below to get started.

Once you’ve validated that there’s an audience hungry for your product and you’ve nailed your value prop, it’s time to talk money. Your business will be viable if you have the funding to get it off the ground and you can identify a price that’ll turn a profit.

Writing a business plan

A business plan is a document you can use to help you secure funding from a bank or venture capital (VC) firm. But even if you’re not seeking outside funding, a business plan forces you to answer important questions about how you will run your business. It includes everything from your mission statement to your financials.

Calculating startup costs

What does it really cost to start a business? It depends on many factors, such as whether or not you carry inventory or you need to lease space. Much of the money spent in the first year consists of reinvesting profits back into the business, not spending out of pocket. This is called “bootstrapping” and you can learn more about it later in this section.

Accounting for all business costs

Your startup costs in the first year will help you cover everything from setting up a website to buying inventory to running your first paid ads. Here’s what business owners reported as the breakdown of their spending in the first year:

By now, you’ve validated your product idea, your business plan is locked, and you’re ready to bring it to life. It’s time to get creative. In this section we’ll take you through the options to make, manufacture, or source your product as you get ready to start a business.

Making or manufacturing a product

If your product is a handmade item, you can get up and running by setting up an appropriate space in your home, a rented studio or office, or a co-op. Be sure to check the legal requirements for setting up a home-based business, especially if you’re selling food or cosmetic items. There are generally rules around ventilation and other safety protocols.

Finding a supplier

If you’ve opted to sell existing products, you’ll need to research suppliers or other brands that you can source them from. Find the business model that applies to you below and click through for a deep dive on how to find products for each.

Shipping is often cited by small business owners as one of the most challenging aspects of getting started. Luckily, the tools aimed at simplifying this task keep getting better. Ecommerce platforms like Shopify consolidate rates to help you make informed shipping decisions. And app integrations can solve specific shipping issues or help you more easily manage inventory.

Setting up shipping and fulfillment

When deciding on a shipping strategy for your business, you’ll first need to decide how you will handle order fulfillment. For many new business owners, that means personally packaging and shipping orders one by one. Unless you choose a dropshipping or print-on-demand model, managing your own fulfillment in the early days helps you better understand all aspects of your business.

As you grow, you may decide to outsource shipping and fulfillment to a third-party logistics (3PL) company. Research different fulfillment services to see which is right for your growing business.

Aside from a unique product or exemplary service, your brand is the driving force behind a customer’s decision to buy from you. Your brand is more than a business name or a logo. It is a guiding set of principles and design specifications that tell your story, create consistency, and build trust. A branding exercise will create the foundation upon which you make creative decisions for your brand as you grow.

Designing a visual identity

Your visual identity encompasses anything that impacts how your customers, and the general public, see your brand out in the world. This includes your logo, fonts you use on your website, photography, and color choices.

Bringing your brand to life

As part of branding design, you will make decisions about assets like photography, printed materials, and packaging. This will ensure a consistent experience across every customer touchpoint.

Shooting product photos

Photography is incredibly important for ecommerce brands that rely on 2D images to tell a story about a 3D product. Photography does a lot of heavy lifting as a stand-in for feeling or trying on the product in person. That’s why good ecommerce photography can increase buyer confidence—and conversion

At this stage, you’ve secured a product and committed to your brand. Now, it’s time to assemble all that hard work into a website and introduce it to the world. There are several ecommerce website builders on the market and you will need to weigh the options based on factors like available features, website cost, and ease of use.

Marketing is reported as one of the most challenging aspects of running your own business—but it’s also the area where you will spend much of your time and budget. Launching a successful website requires ongoing campaigns to actively drive traffic to it and convert those visitors into buyers.

Creating a marketing plan

Along with your financial plan, your business plan should also include your overall marketing plan. A marketing plan is the strategy your business uses to get products in front of your target audience. It’s a roadmap that helps you set goals and have a back-up plan.

💡 Tip: If you’re stuck staring at a blank page, browse examples of marketing plans and best practice ideas for increasing traffic to get you inspired.

Investing in organic marketing

Organic marketing refers to marketing efforts that don’t cost anything. With changing social media algorithms and more competition, organic traffic becomes increasingly harder to get. But there are still clever ways to attract customers on a small budget.

• Taking pre-orders
• Running giveaways to incentivize actions like social sharing or following
• Offering discount codes and coupons
• Hosting grand opening events to draw people to your brick-and-mortar location
• Doing content marketing (like creating blogs or videos)
• Understanding search engine optimization
• Offering affiliate programs
• Proactively engaging in social communities
• Even more low-cost and free ways to promote your business

Exploring marketing channels

There are several channels you can use to market a product. But which is right for you? The best place to start is often the channel where you already feel most comfortable or the place where you know that most of your target audience is already spending time. Test each to see which gives you the best return on your efforts and spend.

Learn more about marketing channels below.

Email

Email marketing can be a successful tool to convert leads to customers, encourage repeat business, and incentivize loyal customers to buy more. This is a cost-effective marketing tool, but it does require higher effort than some paid channels. Growing your email list and producing engaging content at the right cadence are the keys to winning at email marketing.

Google

Google offers up a goldmine of potential customers searching for the very thing you’re offering. But to be sure that they’re finding you, you’ll need to show up in search results. This can be achieved in a number of ways, including search engine optimization (SEO) and paid Google Ads (search engine marketing).

SEO is an organic marketing tactic that involves improving your website to rank higher in search engines. By sending signals to Google that your site offers value and matches the search intent of a user, it is more likely to appear higher in ranking.

Facebook

Facebook is still the largest social media platform in the world, with 2.9 billion users. And it’s an effective tool for many businesses that use it to engage with their community, run paid Facebook ads, and sell products directly.

By now, your small business should be a well-oiled machine. Your product photos are on point, you’re building online communities, you’ve nailed your fulfillment process, and you’re hopefully making regular sales.

Take a moment to celebrate your wins! If you’ve made it this far, you’ve successfully turned a kernel of an idea into a living, breathing small business. So what’s next? You may decide to stay small, dedicating yourself to building relationships with a loyal customer base and managing everything solo. Or, maybe you’re ready for the moon.

Here, we touch on the next steps for your growing business, from seeking additional funding to hiring and managing staff.

Start a business, design a life

You did it! You’ve achieved boss status and you’re already on your way to your next big goal. Along the way, you’ve gathered knowledge and learned from mistakes to help your business be the best it can be. The most exciting part? You’ve built a lifestyle around your passion. Enjoy the ride and remember: take care of yourself along the way.