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First Three Steps to Owning a Business

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There are many people who are perfectly happy as an employee. They have found a great job that they love, and they don’t mind working for someone else. They like the fact that they don’t have to worry about managing the business, and dealing with all of that stress. But there are many more that don’t want to be an employee. They want to be their own boss, set their own goals, and watch a company that they started grow and expand. For those entrepreneurs, owning a business is a must for them. But where do you start? If you are a potential business owner, your accountant in Billings, Montana explains the first three steps to owning a business.

 

Study, Research, Analyze, Test, and Fine Tune Your Business Plan

There are two schools of thought when it comes to starting a business. There are those who write down EVERYTHING, and there are those who go with the bare minimums. Both can have successful businesses, but there is common ground between the two.

You have to do your homework before you even think of starting a business. You need to research the market, study what people like and what they will pay for. You need to test the market (and that includes more than just talking to your friends about what they would like to see). And you need to adjust your business plan accordingly. If your plan says you will make widgets for $3 and sell them for $5, but the market will only pay $3.50 for a widget, you have to adjust your plan so you can still make a profit. If you are ecstatic about starting a turtle walking business, but there is no demand for your business, you need to figure out how to incorporate something else into your business. In order to become one of the 50% of businesses that last more than 5 years, you have to spend a lot of time planning, testing, and researching, before you even look at a business name.

Determine Your Business Structure

You will remember last week when we looked through the various types of business structures. There are pros and cons to each one, and depending on what your goals are will determine which structure you choose. If you have big plans of becoming a large company down the road, don’t even bother starting as a sole proprietor or LLC today. If you never plan to have any employees, and you will be the only one working in the business, then it is pointless to start as a C Corp.

Determining your business structure is something that your accountant in Billings, Montana can help you do. And frankly, it is an easy thing to do. The harder part is filing the appropriate paperwork, and making sure everything is in order. Fortunately, you can sit back and just sign the papers when they are ready. Your accountant will take care of the rest.

Organize Everything

Businesses, no matter what they are selling or offering, can do well with two aspects that are extremely well tuned: marketing and bookkeeping. If you have done step one (the research, testing, and so on) then you will know exactly how to market your business and you will know exactly who to market your business to. That leaves bookkeeping, an aspect that many businesses are absolutely terrible at doing.

Keeping track of spending and income is one thing, and most businesses can do that fairly simply. However, there is more to bookkeeping than just that. You have to know and understand your business inside and out. You have to maximize efficiency, trim the fat, and make sure it’s all going smoothly. The good news is that there are systems that you can put in place, before you even begin your business, to manage all of that (Quickbooks is an example). The other good news is that your accountant in Billings, Montana does just that for you. You focus on your passion and running the business, he focuses on keeping the numbers in order.

If you have a dream, get started with researching it to make sure that it will be foolproof when you launch. Know the market, know the demand, and know what you can charge (charge too much and nobody will buy from you; charge too little and you will struggle to raise prices down the road). Get all of that research done first, and the rest should come much easier.

Practical Taxes is located in Billings, Montana and provides all the services that a full service accounting firm does. From business consulting, to tax preparation, to online payroll services, to bookkeeping, all your accounting needs are met in one place. Call us today at 406-894-2050 to schedule your initial consultation appointment.

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