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Starting a New Business

How to Start a Small Business                                                                          Printable brochure (pdf)

Small Business Administration 

Starting and managing a business takes motivation, desire, and talent. It also takes research and planning.

 

Like a chess game, success in small business starts with decisive and correct opening movies. And although initial mistakes are not fatal, it takes skill, discipline and hard work to regain the advantage.

 

To increase your chance for success, take the time up front to explore and evaluate your business and personal goals. Then use this information to build a comprehensive and well-thought-out business plan that will help you reach these goals.

 

The process of developing a business plan will help you think through some important issues that you may not have considered yet. Your plan will become a valuable tool as you set out to raise money for your business. It should also provide milestones to gauge your success.

 

 

Getting Started

 

Before starting out, list your reasons for wanting to go into business. Some of the most common reasons for starting a business are:

  • You want to be your own boss.
  • You want financial independence.
  • You want creative freedom.
  • You want to fully use your skills and knowledge.

 

 

Next you need to determine what business is “right for you.” Ask yourself these questions:

  • What do I like to do with my time?
  • What technical skills have I learned or developed?
  • What do others say I am good at?
  • Will I have the support of my family?
  • How much time do I have to run a successful business?
  • Do I have any hobbies or interests that are marketable?

 

 

Then you should identify the niche your business will fill. Conduct the necessary research to answer these questions:

  • Is your idea practical, and will it fill a need?
  • What is your competition?
  • What is your business’s advantage over existing firms?
  • Can you deliver a better quality service?
  • Can you create a demand for your business?

 

 

The final step before developing your plan is the pre-business checklist. You should answer these questions:

  • What business are you interested in starting?
  • What services or products will you sell?
  • Where will you be located?
  • What skills and experience do you bring to the business?
  • What will be your legal structure?
  • What will you name your business?
  • What equipment or supplies will you need?
  • How will your company’s business records be maintained?
  • What insurance coverage will be needed?
  • What financing will you need?
  • What are your resources?
  • How will you compensate yourself?

 

Your answers will help you crate a focused, well-researched plan. Your business plan should serve as a blueprint. It should detail how the business will be operated, managed and capitalized.

 

The following outline of a typical business plan can serve as a guide, but you should adapt it to you specific business. We recommend that you break down the plan into several sections at a time.

 

 

 

Business Plan Outline

 
Introduction

  • Give a detailed description of the business and its goals.
  • Discuss the ownership of the business and the legal structure.
  • List the skills and experience you bring to the business.
  • Discuss the advantages you and your business have over your competitors.


Marketing

  • Discuss the products/ services offered.
  • Identify the customer demand for your product/ service.
  • Identify your market, its size and locations.
  • Explain how your product/service will be advertised and marketed.
  • Explain the pricing strategy.


Financial Management

  • Explain your source and amount of initial equity capital.
  • Develop a monthly operating budget for the first year.
  • Develop an expected return on investment, or ROI, and monthly cash flow for the first year.
  • Provide projected income statements and balance sheets for a two-year period.
  • Discuss your break-even point.
  • Explain your personal balance sheet and method of compensation.
  • Discuss who will maintain your accounting records and how they will be kept.
  • Provide “what if” statements that address alternative approaches to any problem that may develop.


Operations
 

  • Explain how the business will be managed on a day-to-day basis.
  • Discuss hiring and personnel procedures.
  • Discuss insurance, lease or rent agreements, and issues pertinent to your business.
  • Account for the equipment necessary to produce your products or services.
  • Account for production and delivery of products and services.

 
Concluding Statement 

Summarize your business goals and objectives and express your commitment to the success of your business.

 

Once you have completed your business plan, review it with a friend or business associate. When you feel comfortable with the content and structure, make an appointment to review and discuss it with your banker. The business plan is a flexible documents that should change as your business grows.

 

  

For More Information

 

Information is power. Make it your business to know what is available, where to get it and most importantly, how to use it. Sources of information include:

  • U.S. Small Business Administration
  • SBA District Offices
  • Small Business Development Centers (SBDCs)
  • Service Corps of Retired Executives (SCORE)
  • Small Business Institutes (SBIs)
  • SBA OnLine (electronic bulletin board)
  • Business Information Centers (BICs)

 

The SBA has offices located throughout the United States. For the one nearest you, look under “U.S. Government” in your telephone directory, or call the SBA Answer Desk at (800) 8-ASK-SBA. To send a fax to the SBA dial (202) 205- 7333.

 

To access the agency’s electronic public information services, you may call the following:

 

SBA OnLine:

Electronic bulletin board – modem and computer required

(800) 697-4636 (limited access)

(900) 463-4636 (full access)

(202) 401-9600 (D.C. metro only)

 

 

SBA Home Page:

www.sbaonline.sba.gov 


SBA gopher:

gopher.sbaonline.sba.gov

 

 

You also may request a free coy of The Resource Directory for Small Business Management, a listing of for-sale publications and videotapes, from your local SBA office or the SBA Answer Desk.

Other Sources

 

  • State economic development agencies.
  • Chambers of commerce
  • Local colleges and universities
  • Libraries
  • Manufacturers and suppliers of small business products and services
  • Small business or industry trade associations

 

All of the SBA’s programs and services are provided to the public on a nondiscriminatory basis.

Printable brochure (pdf)



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Contact Information
Carlsbad Department of Development
400-2 Cascades Ave. Suite 201
• Carlsbad, NM 88220
Ph: (575) 887-6562 • Fax: (575) 885-0818
City of CarlsbadEddy CountyNMEDDChamber of Commerce