Introduction to starting your business journey
Turning dreams into successful ventures
Steps to Start Your Own Business
Below are the main steps for starting a business. The term "steps" can be a bit misleading, as in practice there is rarely a 100% chronological order. Steps often occur in parallel and iteratively. Also, not all steps are equally important for every entrepreneur. Much depends on the individual and the type of business, but overall, the overview below closely reflects reality.
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Your motivation, skills, and perseverance
Most people have thought about starting their own business at some point. For many, it remains a dream, but more and more people are taking the step to realize it. Depending on the complexity of the business, the entrepreneur will be required to handle a wide range of topics. Entrepreneurship is multidisciplinary and therefore requires diverse skills. To turn the dream of entrepreneurship into reality, a good idea and the right circumstances are important, but above all motivation, skills, and perseverance are essential. Given the small number of people who successfully make the leap, it’s a good idea to map out these three elements before proceeding.
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Developing your idea into a business plan
When starting your own business, you'll face a wide array of tasks. To make sure you don’t overlook anything and to structure your plans, it’s useful to work with a framework or template: a business plan. With this plan, you can develop your idea and systematically address different parts of your business.
But don't worry, writing an extensive plan is not always necessary. Not every detail needs to be fully developed yet. The key is not to overlook essential aspects so that you can make informed decisions. The business plan is a dynamic document that can evolve and improve as your business grows. It serves as a guide and helps you deal with external influences and changes in your business environment.
The business plan covers various important topics, such as the entrepreneur, the business idea, your strategy, marketing aspects (including your products or services), financial matters, and organizational considerations. There is plenty of information available online on how to write a business plan. On our website, you can find Word templates and Excel spreadsheets for your financial plan. If you want more support, you can consider using our online tool (included with an annual membership). This provides structure and guidance while writing your business plan. The result of this step is a coherent business plan that forms a solid foundation for your next steps.
The first steps in implementing your business plan
While creating your business plan, you will likely discover certain things you want to arrange immediately. The steps below are mainly organizational in nature and are often taken at an early stage.
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Business name, legal structure, and Chamber of Commerce registration
Before you can actually start your business, it is mandatory to register your company with the Chamber of Commerce. When registering, you not only record the company name and any trade names but also the legal structure of your business. This ensures that no one else can use your chosen business name. It is also advisable to register your domain name to prevent someone else from claiming it (also known as domain squatting).
Once you have registered with the Chamber of Commerce, your business is automatically registered with the tax authorities. The tax office will then contact you to discuss the required steps. The website of the tax authorities contains detailed information about this process.
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Registering a domain name
It is very important to register the domain name of your website as soon as possible. There are numerous "domain hijackers" who quickly register the names of recently established businesses and then resell them at high prices. To prevent this, it’s wise to register the associated domain name immediately after confirming the availability of your business name.
There are various hosting companies where you can register your domain name. These providers often offer web hosting services alongside domain registration.
Be sure not to skip this step to maintain control over your business name and online presence.
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Permits and requirements
The organization section of your business plan should also cover permits and legal requirements. These vary by business type. While we can’t provide an exhaustive list, it’s important to stress how crucial it is to research this early and act when necessary.
Obtaining permits can be time-consuming, with processing times that vary greatly. Therefore, it's advisable to determine which permits and requirements apply to your business situation early on. This helps avoid delays and potential problems when launching your business.
For more detailed information, you can contact relevant industry associations. The Chamber of Commerce can also provide useful information and support.
Make sure you comply with all applicable requirements and permits so that you can start your business on a solid foundation.
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Financing
The financial section of the business plan should also cover capital requirements. Obtaining the right financing remains one of the biggest challenges for entrepreneurs. Fortunately, many financing options are now available, including emerging ones such as fintech companies that specialize in providing funding.
It is essential to seek an optimal mix of equity and debt to meet your capital needs. Having enough equity can increase your financial stability and your chances of securing external funding. Conversely, using debt can expand your financing options but also involves risks that must be carefully considered.
Take the time to thoroughly research financing options suited to your specific situation and needs. This may include traditional bank loans, investors, subsidies, crowdfunding, and alternative financing forms. Weigh the pros and cons and make sure you understand the risks and conditions associated with each option.
It’s a good idea to seek professional advice and discuss your financial plans and needs with finance and investment experts. By creating a solid financial plan and applying the right financing strategies, you increase your chances of securing the capital you need and laying a solid foundation for business success.
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Accounting and business bank account
It’s highly recommended to start recording your startup costs and managing all expenses through a separate business bank account, such as with Knab. Using a dedicated business account allows you to separate business from personal finances, making it easier to maintain a clear overview of your business transactions.
Additionally, many of your initial costs may be tax-deductible. By keeping track of and documenting these expenses properly, you may benefit from tax advantages. Consult a tax advisor or accountant to ensure you are aware of the specific rules and deductions available to you.
Well-organized bookkeeping and financial tracking help you gain financial insight, monitor your business's health, and prepare for tax filings and other obligations. It’s wise to establish a solid system from the beginning and to regularly update your records and account.
By tracking and managing your startup and business expenses through a separate business account, you ensure financial transparency, efficiency, and compliance with tax obligations. This sets your business on a strong financial foundation.
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Business premises
To run a successful business, having a suitable space is important. Even if you're working from home, it's often advisable to have a separate area dedicated to business activities. You may have already addressed this in your business plan. When choosing a location, consider factors like zoning plans, environmental permits (for construction or renovation), environmental management, and potentially an operating license (especially for hospitality businesses).
The zoning plan is crucial when selecting business premises. It specifies which activities are permitted in a given location. It's essential to ensure the zoning aligns with your business activities. Additionally, construction or renovation plans may trigger the need for a permit. Always verify whether any permits are required and if there are additional requirements for building or renovation.
Environmental management and compliance may also be necessary depending on your industry. Hospitality entrepreneurs, for example, may require an operating license, which covers aspects such as opening hours, noise levels, and safety measures.
Gather the necessary information early about permits and regulations for your business space. Contact the local municipality, check zoning plans, consult industry associations, or seek advice from the Chamber of Commerce. Doing so in time can help you avoid delays or legal issues when moving into and using your business premises.
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Official launch
Congratulations! It’s time to celebrate the official launch of your business. You’ve already taken several important steps and may have even acquired your first customers. This is a milestone to be proud of. Take a moment to celebrate and reflect on your achievement.
It’s important to take care of yourself during this exciting period. Entrepreneurship can be demanding and energy-consuming, so finding balance is key. Make time for rest, relaxation, and self-care. This will help you stay energized and motivated to continue building your business.
Move forward with confidence and enthusiasm as you implement your plans. Keep your goals in sight and stay focused on your vision. Don’t be afraid of challenges and learn from setbacks. Stay flexible and adjust your course when needed, but never lose the passion and excitement with which you started your business.
Wishing you great success and enjoyment as you pursue your entrepreneurial dream! Enjoy the journey and the opportunities ahead.
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Periodic reflection
Of course, you hope everything goes according to plan in your business. To stay on track and reach your goals, it’s important to regularly step back from daily operations. Take time each month to reflect on your business — both the successes and the challenges.
Evaluate what’s going well and what you're satisfied with. This gives you insight into your strengths and what you can leverage to grow further. Also consider the areas that are underperforming or need improvement. Identify bottlenecks and think of strategies to address them.
Be open to adjusting your plans if necessary. Unexpected events or market changes may require flexibility and adaptability. Don’t be afraid to revise your strategy to maximize your chances of success.
To help monitor and adjust your business, you can use our online tool. It provides a good foundation for regular evaluations and updating your objectives.
Monitoring and adjusting your business is an ongoing process. By regularly taking a step back and critically assessing your business, you can respond proactively to developments and maximize your growth potential. Stay focused, keep learning, and keep striving for optimal success.
Wishing you much success in achieving your business goals!