I recently had a meeting with a young woman who is hoping to start her own service business this year. We spoke over coffee about the fears and challenges of taking that leap of faith, and it got me thinking. How many young entrepreneurs in Texarkana have no idea where to start? If you’re planning to start your first business, there are a few best practices you should be aware of.
Phase 1: Research
This is the most important phase. It helps you to validate your business with data.
Steps:
Define your offer. What are you selling? What sets you apart from others selling the same thing? What is the average price point for this service? How many competitors are in your market?
Define your customer. Are you selling to a business or individual? Does this product appeal to a certain gender, age, income level, geographical area, etc.?
Create your pricing structure. Keep it as simple as possible.
Test market demand. Ask your friends and family if the product or service is something they need. You could even go as far as an initial advertising campaign to gauge response. The goal is to get 3-5 paying customers before you go all in.
Phase 2: Set the foundation
Once you have a few paying customers, it’s time to legitimize your business.
Steps:
Name & Basic Brand. Create something that’s simple but memorable. Try to include words you know people will be searching if they need your product or service.
Talk to an accountant. Many local CPAs will give you a free initial consultation. Utilize their expertise to find out how you should structure your business, what expenses to track, and what to expect when filing taxes.
Register your business. Depending on the guidance of your accountant, you will need to file a DBA at the County Clerk’s office or an LLC with the state. You may also need to file for an Employer Identification Number (EIN) with the IRS and set up an account with your state Comptroller for sales tax. (This is why step 2 is important!)
Open a business bank account to track your business and personal finances separately. Do your research here, too, because some banks charge transaction fees for commercial accounts.
Get General Liability Insurance - if needed.
Set up a bookkeeping system, whether you will do it yourself with Quickbooks online or hire someone. There are some great local services with reasonable rates available in Texarkana that will save you a lot of headaches and time.
Purchase equipment, tools, and materials. If I had one piece of advice to give you it would be this: buy the minimum you’ll need to do the work and scale as you go. Try to avoid taking out any loans for your business until you have a well-established customer base.
Phase 3: Build a “Minimum Viable Presence”
You don’t need a flashy, ten page website- just one that is findable, trustworthy, and user friendly.
Steps:
Contract a basic website. This could be as simple as a one page landing site that includes your services, pricing (or “starting at”), contact form, and trust signals like testimonials or before and after pictures.
Set up your Google Business Profile. Use your service area and add your website and contact information and some photos. Start collecting reviews immediately.
Social media pages.
Phase 4: Build a Simple Customer Funnel
This step will depend on your budget restrictions. I always recommend budgeting for some ad spend, especially in the beginning.
Steps:
CRM. Input everyone who contacts you, whether they use you or not. Follow up with them periodically to see if they are happy with their provider. A good CRM will also help you schedule and maintain your current customers.
Google. Eventually this will be your #1 lead source. Keep your profile up-to-date.
Facebook groups. One of the fastest ways to get local traction.
Referral system. “Refer a friend and get …”
Yard signs/door hangers. (It still works!)
Digital/media ads. A good marketing consultant can help you with a marketing plan that’s right for the demographic you’re trying to reach.
Phase 5: Standard Operating Procedures
Track EVERYTHING - from how much time it takes you to do the job to the supplies you use. It will help you make data-based decisions about the operations of your business and make it easier to scale when the time comes. Input the information on a spreadsheet (or have AI do that for you), and create an SOP for every service you offer. When your business has grown enough to hire employees, you’ll be grateful you have a blueprint to pass on.
Starting your first business can be overwhelming- and a little scary. Don’t be afraid to lean on the experience of those who came before you. Utilize the resources available to you, like Texarkana small business groups and networking events. Your future success will depend on the foundation you lay today!