So you’ve got a groundbreaking idea for a new product or business, and probably wondering how you’re going to do this. Now what? Questions and doubts are probably running through your mind:
- Where do I begin?
- Will people buy my product?
- I’ve never started a business before. Can I do this?
- I’m scared I’ll fail!
Hold on, don’t let your fears take over! And yes, you can do this! Here are a few simple first steps to get your business up and running.
The first step to making sure you will have a profitable business is to test the market. You have to first ensure that what you offer, people will want. You’re probably wondering how to do this.
First, you need to determine if you have a product that people are willing to buy. Let’s say you have just created the world’s most delicious brownie.
I mean, it puts every other brownie in the world to shame. Everyone tells you how amazing it is! You have made these brownies for family and friends, and everyone asks you to bring them to all the get-togethers. Well, that’s great!
That has established that you can make a good brownie, but what will strangers and actual customers think?
Consumer Research
It’s time to put your brownie to the test. Find local farmer’s markets, networking, and local events, and get people to try your product for honest feedback.
Are they willing to pay for your brownies? That’s the key. If consumers are willing to pay for your product, you can then start to build a successful business.
Now that we have established that there is a market for your product, it’s time to sell it. Do you want to sell direct to consumers (e-commerce, local markets, etc) or do you want to build a wholesale business where you sell to retail locations? Once you establish this you can then start to put the wheels in motion.
Make it Legal
Now, here is where it gets a little more complicated, but don’t worry, you got this! The first thing you will need to start conducting actual business is a legal structure such as an LLC. Sounds scarier than it is.
There are many resources out there that can help you do this, but a simple Google search for “start an LLC in your state” should put you on the right track.
Next, you will need to open a business bank account. Some small businesses are required to have a separate bank account, but it’s always a good idea to keep your personal and business funds separate.
Here’s a list of what you may need to open a business account:
- Employer Identification Number (EIN) (or a Social Security number, if you’re a sole proprietorship)
- Your business’s formation documents.
- Ownership agreements.
- Business license.
I highly recommend that you invest in either an actual bookkeeper or software such as Quickbooks to keep track of your sales and profits. This will tell you if you have enough money to grow, hire employees, and hopefully draw a paycheck.
Easy E-Commerce Platforms
If you want to sell a CPG (consumer packaged goods), you will most likely want to set up an e-commerce site, so you can start direct to your consumers. Selling to your customers directly is the most profitable way to sell your products.
Your margins are higher, so more money goes into your pocket or back into your business. Other ways to sell direct to consumers would be:
- Facebook Marketplace
- Local farmer’s markets
- Instagram store
- Etsy
- Local events
Do Your Due Diligence
One thing I need to mention is that if you are going to be selling a food product, you will need to learn about the “cottage laws” in your state. Some states are more lenient than others, so please do your due diligence before making and selling baked goods/food products out of your home.
There are many shared commercial kitchens that will let you use their kitchen for an hourly fee, and that’s always the best way to make and sell food products until you are ready for manufacturing.
My last piece of advice is to find yourself a mentor. Find someone who can help you navigate your way from starting a business to selling your products and growing your business.
Find someone who has been in your industry or similar who can coach you and hopefully keep you from making those first-time entrepreneur mistakes. You may be able to find someone like this through networking events, and entrepreneurial communities or LinkedIn is also a wonderful resource.
I know that it can seem overwhelming to start a business, but the rewards can outweigh the cons if you start by taking the correct first steps. Just remember that you are capable, you are worthy of success and you do, in fact, got this!
