How To Start A Micro Business
So, are you interested in starting a micro business? The benefits are undoubtedly significant, and like any other type of business, they come with challenges. But I dare say that those who have the will to succeed can certainly start and succeed in a micro business. Here is a step by step approach to starting a micro business.
Establish A Mission And Vision.
It is essential to develop and clearly state the intentions and purpose of the business. This is the foundation of business and transcends mission and vision. Without a clear vision and mission statement, growth will be stunted because the path to realizing the company’s more detailed plans will be blurred. A well-structured vision and mission statement also reveal what the business stands for and attract customers and investors who are interested in the core values of the business.
Build A Good Business Plan
Your business plan is a written document that contains and clearly describes the goals, anticipated costs, and detailed strategies for managing your micro-business. If you need to attract micro business investors or get loans, then a formal business plan is essential.
Research shows that people who write great business plans are more likely to start a business. Writing a business plan also raises critical questions for the success of the business, such as:
A business plan usually includes financial details, projections of sales, expenses, assets and cash flows. Financial documents required for a formal business plan include:
- A balance sheet showing what you own and what you owe
- A profit and loss (or income) statement summarizing revenues and expenses every three months (quarterly) and annually (every year).
- A cash flow statement (or forecast) showing working capital for better forecasting of expenses.
Decide On A Micro Business Structure
Setting up a successful business is essential to creating a business structure – a legal entity – to run the business.
Sole proprietorships (which are businesses with one owner) and partnerships (with two or more business owners) are the least expensive business structures. In these settings, owners have all the power in business decisions. They are also required to file reports detailing income and losses and are therefore personally liable for any debts related to the business. If the business fails, they can file for bankruptcy, which may allow them to get out of debt but damage their personal credit history in the process.
A corporation is a legal business structure that is legally separate from the people who own it under state or federal law. Like people, corporations can own property, incur debt, sue and be sued. Most corporations exclude members from personal liability for business dealings or lawsuits.
If you need any help in starting a new micro or small business you can consult now.