The journey of entrepreneurship has been chosen by more and more peoples seeking to transform society through their own business.
But from where do you start? Actually, if you want to achieve success with your business, then it is very well known that entrepreneurship is comprised of a lot of planning and market research. Thus, one must not jump over any steps while accomplishing this procedure.
To help you get your project off the ground, we have prepared this content with the main steps on how to start a business from scratch . Let’s go together!
1. Identify a business opportunity
This is the basic step to starting a business! Given the wide range of entrepreneurial possibilities , it is important to outline your business idea based on identifying a market opportunity.
Some options are:
- sell an entirely new product or service;
- offer a solution that already exists, but in an innovative and differentiated way;
- market a product or service that complements another existing solution;
- serve a niche market that is still little explored by the market.
One tip is to look for an area with which you have some familiarity. Having knowledge about this sector makes it easier to find a need that is not yet being well met by existing solutions.
2. Conduct market research
To ensure that there is a demand for your ideal product or service, you must base your research on real market research data.
You can conduct this research yourself by interviewing potential customers and publishing online forms, hire a specialized company or use studies that have already been published.
Analyzing the market is also essential to map your potential competitors , identifying the strengths and weaknesses of each one and understanding how your business will position itself in relation to them.
3. Define your target audience
Who will be your business’s ideal customer? This is an essential definition for those who are starting out in business, and can be answered using tools such as:
- Target audience : profile of the group of consumers you want to reach, with common characteristics and behaviors, such as gender, age group, social class, region, interests and values;
- Persona : character that represents the ideal buyer for your business, bringing together their main demographic data, consumption habits, lifestyle, needs and challenges faced;
- Empathy map : visual tool that draws an even more detailed and in-depth profile of the customer, based on understanding the consumer’s feelings, desires and thoughts.
Regardless of the tool used, it is important to base it on real data, from interviews and research.
By understanding who your target audience will be, you will be able to make the best decisions, always placing the customer at the center of your business — a strategy known as Customer Centric .
4. Structure a competitive edge
If you want to stand out above the rest in market competition, then you must find for your business a competitive edge. This can be achieved in different strategies according to the target audience and according to your goals.
Some examples of competitive advantages are:
- lower prices;
- superior quality of the product or service;
- humanized and agile service;
- high perceived brand value;
- sustainable production process;
- exclusivity of solutions, etc.
5. Select your business model
Another initial definition you should make is in relation to your business model . Thinking specifically about a digital enterprise, the main possibilities are:
- Online store : sale of physical products through your own website;
- Marketplace : marketing on marketplace platforms, in exchange for a commission on sales;
- Social commerce : selling through social networks such as Instagram, Facebook and WhatsApp;
- Infoproducts : offering digital products, such as e-books, consultancies, online courses and webinars;
- Recurrence : recurring sale of a product or service, through plans, monthly payments or subscriptions;
- Software as a Service (SaaS) : recurring billing for the use of a specific software.
6. Make a financial plan
Calculate the initial investment to start your business from scratch, taking into account all the costs to get the operation up and running and the working capital to maintain the business until it starts generating profit.
A very important indicator is the break even point, which indicates the sales volume needed to cover all operating costs in a certain period of time.
It is also essential to define how the resources will be raised to create the company. The initial capital can come from the company’s own investment, from the participation of partners or from lines of credit, for example.
7. Formalize your company
With NTN you will generate invoices, collect taxes, and receive differentiated solutions like credit lines and special financing. Formalize your business according to the above requirements.
One option for those who are just starting out is to formalize as an Individual Microentrepreneur (MEI). Aimed at those who earn up to R$81,000.00 per year, this modality has a single tax payment guide.
8. Create a business plan
Now is the time to organize all the information about your venture into a business plan .
This document allows you to analyze the company’s viability and have an in-depth view of the business’s operations, objectives and scenario, serving as a guide for making the most strategic decisions .
The following are some components that the business plan ought to contain:
- company data, such as, legal nature and share capital;
- description of the business, products and services sold, target audience, sector of activity and competitive advantages;
- market and competitor analysis;
- marketing plan, detailing advertising and promotion strategies;
- operational plan, explaining how the operation will work;
- financial plan, with calculation of the necessary investment and revenue and profitability forecasts .
With this document in hand, you can start getting your business off the ground, following the defined strategies.