In 2022, there were 183,972 small businesses in Idaho making up 99.2% of all businesses in the state. If you’re thinking of joining the many people who start a business in the new year, here are four crucial things to consider.
Identify a target market
A business niche is a focused or specialized area of a broader market. A unique idea is a great start, but you’ll want to find your business niche and identify your target audience before launching. For example, pet accessories would fall within the pet supplies market. Ask yourself what sets your service or product apart from others and makes it special. Be sure to research your target market and get to know your audience. Learn more about the importance of a business niche and how to find yours.
Choose a business structure
From sole proprietor to limited liability company (LLC), there are a variety of business structures to choose from. Determining which is best suited to your company can help things run more smoothly from the outset. The type of structure affects day-to-day operations, liability, how to raise funds and how to pay taxes. Make this decision early on because you may need to set up a business entity to open a business bank account, get a business credit card or apply for a small business loan. To choose a structure, consider flexibility, liability protection, tax implications, permits and licensing requirements. It can be helpful to talk with a lawyer and accountant before making this decision to help you weigh the pros and cons of each type of entity.
Consider funding and financing
Starting a new business requires capital to cover payroll, equipment and other expenses. How you finance your business will depend on whether your funding will be internal or external. Internal funding includes personal savings, credit cards and funds from family and friends. External funding includes small business loans, grants, angel investors, venture capital and crowdfunding. Businesses can use various sources, and there are positives and negatives to each type of funding. To decide, consider how much money is needed, the timeframe for repayment and your risk tolerance.
Identify where new clients will come from
Every new business needs to think about where its first customers will come from. If you’re well-connected, consider if anyone in your immediate circle fits your target market. If your circle is small, you may need to attend networking or industry events and build relationships with potential clients. Some new businesses partner with other more established companies or freelancers until they get settled and start generating their own leads.5 Think about how you can leverage your network and do some research on ways to produce organic growth, like asking for referrals and building a website with strong search engine optimization (SEO). Here are a few more ideas to get started on attracting new customers.
As you consider these tips don’t forget business insurance. It’s paramount to protect yourself from losses and if you plan to hire employees. To find the best insurance for your business reach out to an FBICI agent today.
Disclaimer: The information included here is designed for informational purposes only. It is not legal, tax, financial or any other sort of advice, nor is it a substitute for such advice. The information may not apply to your specific situation. We have tried to make sure the information is accurate, but it could be outdated or even inaccurate in parts.
Sources
North Idaho Business Journal
Small Business Association
Forbes Advisor
Business News Daily
Forbes
