"The most important thing someone can do when starting a new business is research," says David Lee, lending manager for the Small Business Administration Department at Regions. "The Internet, a bookstore or the business school at a local college can all provide valuable resources."
The Small Business Administration (SBA.gov) can provide an excellent overview of information and can also direct you to a local office for more information. Most colleges and universities also offer small business classes—some as short as an afternoon—to educate people on business basics.
Researching the local marketplace also will help potential business owners be more informed about other considerations such as competitors, and what realistic profits they might expect.
Why Is a Business Plan Important?
Anyone who is considering starting a new business is advised to develop a business plan.
"Not only does a business plan help us see your vision, but it also forces you to think through all the different aspects of the business," says Lee.
Lenders also look at the background of potential business owners. It adds considerable strength to a business plan when someone has specific experience in the industry.
"A resume highlighting experience and strength in relevant areas is an important aspect to any business plan," says Lee.
Don't Forget to Include…
There are some important details to include in every business plan that can help you obtain funding and solidify your future business. Showing that you've thoroughly researched the market and have a detailed plan is a great way to launch your new company.
- Start-up cash and monthly expenses - How much money do you need to get your business off the ground and what will your month-to-month costs be?
- Competition analysis - Know your competitors, understand what you're selling and what they're selling, and be aware of the overall market.
- Challenges and roadblocks - Consider the problems you might encounter or any barriers you might face in starting your business.
Second Thoughts?
Another important aspect of owning a business is having an exit strategy if things go awry. There are many different options for exiting a business, such as selling, transferring ownership, or liquidating assets. Your strategy should be included in your business plan.
Looking for more information on how Regions can help you start your business? Visit your local branch and ask to speak with a Regions business lender.