Are you sitting on the next big thing? Have an idea stewing in your head that you think is great, but wondering if anyone else will agree? Oh wait, I already asked you that! If my last post got you excited to jump into entrepreneurship, I expect you might be wondering where to start. Seeing as how I let this question paralyze me for years, I can sympathize what that deer in headlights feeling of not knowing where to begin. Let me do you the favor of laying out the basics of starting a small business. Come on Houston, let’s get to work!
Make a Small Business Plan
All of my experience is with opening a Cottage Bakery, but starting with a Business Plan for any small business endeavor will help you flush out the details of your specific venture. It’s the best way to think through your requirements, risks, and finances – all those things aren’t making and shaping dough/knitting/crafting/3D printing/photography/that thing you do so well that you’ve decided to sell it, but are equally as important if you want your business to be successful. It’s likely also a requirement if you intend to apply for a business loan. There are countless resources available to guide you, but I recommend checking out the information and templates from the Small Business Administration.
While this step may seem tedious, I promise it is well worth the effort. At the end of a well-done business plan you’ll know what your startup costs are and how you’ll plan to secure that funding. You’ll know who your target customers are and how you plan to reach them. You’ll know your start-up timeline and growth potential, the laws and regulations that are applicable to your business, and the missing skillsets you might need to hire to be successful. You’ll have learned from your competitors – what they do well, what they do wrong, and how to position yourself to compete with them. You’ll have thought through future challenges and made plans to address them. Most importantly you’ll have a plan to go from zero to selling that you can look back on again and again to help navigate inevitable issues and keep yourself on track.
Get Friendly With AI
Searching for a business name? Ask ChatGPT. Curious which platforms are available for selling your product, their fees, and features? Ask ChatGPT. Want to create engaging posts about your products that will entice customers and help boost your sales… ChatGPT. It is my friend, and I’m not ashamed to admit it. The more I use it, the more it knows me. It knows my style, knows my preferences, knows how I talk, knows my products, my website, my prices and sales schedule. And I know it’s possible I’d still be searching for the right thing to call a business run by a retired NASA engineer selling sourdough – if I hadn’t decided to ask ChatGPT.
Find Your Tribe
The world of people wanting to support you is larger than you realize. They are your friends and family that you’ve been giving free product to forever and are more than happy to start paying for it. They are your neighbors who take the mantra “shop local” to heart and would love to support a new local small business. They are the online community of people just like you selling similar products and services. The people that have done it already and are happy to share their knowledge and experience. For me, my tribe includes the woman who pushed me to action and became my first customer. The friend who taste tests all my bread (even when it’s terrible) and has become my best customer. The one that will sit with me at my first vendor event so I’m not lonely. The army of Facebook friends that recommend me on every local page in Pearland. And the two cottage bakery Facebook groups I joined to share and get answers to all the questions I’ve ever had about selling sourdough. I don’t know what business you’re pursuing, but more than likely there’s a group(s) out there waiting for you. Find them, join them, tell all your friends and family what you’re doing, and then be overwhelmed by the amount of support extended your way.
Make it Official
Nothing felt more official than filing the forms to register my business with the state of Texas. Forming an LLC and obtaining a federal tax ID takes your concept out of your head and formalizes it . It’s also very VERY easy! I put off this task for way too long assuming it would be complicated and require a lot of paperwork. I couldn’t have been more wrong. It costs $300 to register your LLC and can be done in minutes through the Texas comptrollers website. I’d explain the steps, but this video did it for me.
When you’re done with that, head over to IRS.gov and apply for a federal employee Identification Number (EIN). You’ll need this if you plan to hire any employees, and of course, to pay taxes. Watch out for people offering to do this for a fee (these became a standard part of my junk mail once I registered my LLC). Getting an EIN is free, and also super easy.
Visit the Bank
You can’t make money without spending money, so a visit to the bank is always a first step. Obviously the place to go if you’re seeking a loan, but also if you’re planning to use your own savings. If you’ve registered as an LLC, you’ll want to create a separate bank account for your business to keep those finances and your personal finances independent. While you’re there, ask about credit card options. The right card will come with little to no fees and give you rewards matching your business expenses. For example, the card I used gives me 3% back for shopping online and 2% in grocery stores. Which means I save every time I buy flour, ingredients, bread bags, and all of my product packaging. Most banks will also offer a multitude of resources to get your business up and running. Payroll processing and point of sale systems, help with your business plans and registering your LLC, tools to track your cash flow – even if you don’t know what you need (especially if you don’t know what you need), a trip to the bank to talk through your business goals will be worthwhile.
Be Inspired By Dragon Boy
If all of the above sounds like a lot and has you feeling overwhelmed, take a breath, learn from your previous Mompreneurs, and meet Eze Llanes. I met him at the Alvin Music Festival. It was my first vendor event, but Eze has been selling his 3D printed dragons for over a year at events all over town. The weekend I met him, this high school senior was selling at three separate events and has grown the Dragon Boy business so much that he’ll be operating two booths at the Texas Rennaissance Festival this year. This exceptional young man could write this post himself. At just 17 years old, he accomplished what I put off for so long – operating a small business. He’s obtained a bank loan, registered his LLC, is finding new markets, and knows how to grow his tribe (hint, saving your fellow vendors from torrential downpours and runaway tents makes people want to be your friend). He puts hours in when he’s not in school and earns more money than any part time job could offer. I was so impressed by Eze and his business that I knew that you all needed to hear about him as well. If he can be a successful entrepreneur while still in high school, I know you can do it while doing all of the mom things. Be inspired by Eze. I know I am!
