1. Understand your target customers and market

It’s possible to develop an excellent business concept and deploy it in the wrong area. That’s why it’s important to understand the area in which you want to start your small business as well as your target customers. An idea that could work out very well in a large, densely populated area simply may not get the amount of foot traffic or number of customers it needs in an area with fewer residents.

Assessing the market for your products or services, seeking out the presence of potential competitors and assessing how your business will hypothetically perform can all move your idea in the right direction.

You can also look to competitors and similar businesses for ideas and guidance, although indirectly. Visiting their stores, looking at their websites and marketing materials and other intelligence-gathering initiatives can help you fill in pieces of the puzzle.

2. Have passion in what you about to open.

Having a passion for something doesn’t necessarily mean it’s your all-time favorite activity or type of business. It does mean that you won’t quickly grow tired of running that type of business, that parts of it appeal to you and, ideally, you can use some combination of existing knowledge or skills related to parts or all of the operation to your advantage.

Finding an existing need and targeting it is a major element of starting a successful small business, whether it’s providing accounting services to other companies or setting up a bakery. Pairing that need with something that excites, interests and motivates you can lead to substantial development and returns.

This piece of advice is relatively basic and most useful when deciding what type of business to start as opposed to getting a specific concept off the ground. Focus on your passion early on and pair it with a strong business plan to give yourself the best chance of crafting an enduring and popular organization.

3.Write a business plan

This is essential. It’s your roadmap. Remember, it’s not set in stone; it’s always evolving, with your business and should include longer-term objectives, estimates and forecasts. Each step should, if possible, be measurable so you can gauge your success and so you can access funding and investment, if you need to.

4. Apply for licenses and permits

Keep your business running smoothly by staying legally compliant. The licenses and permits you need for your business will vary by industry, state, location, and other factors.

5. Know how to track income and expenses

Running a business means you’re going to make money. And, you’re going to spend money along the way. You need to track incoming and outgoing money in your accounting books.

To ensure your books are in shipshape, you need an accurate and reliable accounting method. Here are a few options:

• Accounting software
• Accountant
• Spreadsheets