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How to Start a Small Business

Starting a small business can seem like an overwhelming challenge. But with this step by step guide you’ll learn all the basics to start a business and see that your dream of being an entrepreneur is achievable and just waiting for you to get started.

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If it’s your dream to become and entrepreneur, you’ve come to the right place. While the Internet is a wonderful resource for research, the sheer volume of information can leave you feeling overwhelmed and unsure of where to start. So here is your comprehensive guide of how to start a small business, step by step.

Starting a Small Business – Step 1: Talk to small business owners

When you think ‘entrepreneur’, you think Richard Branson, Steve Jobs, Mark Shuttleworth and Zuckerberg. These are big names, even bigger personalities and industry giants. So it is natural for someone wanting to start their own business to be a little intimidated. This is why it’s a very good idea, once you’ve decided to start a small business, to get talking with as many small business owners as you can.

You needn’t confine your conversations to those operating businesses similar to your idea – the more people you talk to, the better idea you’ll have of the basic skills required, some of the common challenges faced by small business owners, what to look out for, how to deal with problems, and developing a network of entrepreneurs you can turn to for encouragement, advice, and guidance.

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A small business owner needs to match their passion with their skill set

Once you’ve spent time talking with small business owners, you’ll have a pretty good idea that although the challenges are great and stress can run high, a successful small business is also extremely rewarding and fulfilling. What you’ll also have found is that the very successful small business owners you’ve spoken to haven’t achieved their success by accident: They will have identified their character strengths, skill sets and personal interests, and rolled them up in to a business that harnesses these strengths. And this is what you should do too before you even get started.

It doesn’t matter if you’re fresh out of high school, college, a housewife, are working for a corporate, have been retrenched, aren’t ready to retire, or just want to be your own boss. Take the time to match your passion with your skill set. Do you love people and have HR experience? Do you love restoring classic cars and have experience in sales?  These are clear matches, but even those that seem less obvious at first can be paired up to form a business. Successful entrepreneurship is about having a passion and living it every day. If, however, you find you’re passionate about something but lack the necessary skills or depth of knowledge, your next step is to up-skill.

Get skilled: Attend a small business course

The business environment is a highly competitive one. Even if your business idea is revolutionary and nothing like it exists on the market, it won’t stay that way for long (especially if it’s a great idea!). Secondly, a great idea is nothing unless it can be set in motion and for this to happen you need to have the right skills. This is where up-skilling comes in: It can be as simple as day to day Internet research to gain more knowledge about an industry or skill, taking on an apprenticeship or shadowing, attending a short or part-time course, to enrolling in a degree or MBA.

Here are some tips for getting started on up skilling:

  • Critically assess your business idea for the skills needed to make it work. Then critically assess yourself and ask others who know you well what skills you should improve on.
  • Then allocate time to develop these skills. Be realistic about what you can achieve on a daily, weekly and monthly basis. Over committing yourself can lead to fatigue, burnout and a sense of defeat.
  • Network. You can learn a lot from people already in the know. They’ve accumulated valuable time and experience and can help you avoid wasting time and energy in the wrong direction.
  • If you’re still feeling like a qualification is needed, get researching to see what courses are available that best suit your time and wallet.
  • Keep an eye on the bigger picture. If you spend all your time on up-skilling rather than getting your business off the ground, it defeats the object of up-skilling. Learn just enough to get you going, to know when you’re going wrong, and let the business and the industry inform you of where you have further skills strengths or gaps.

Write a plan for your small business

No matter what your goals are, without a plan a goal is just a dream.

  • Step one is to pinpoint your business purpose. Assess why you want to start a business – do you want a business that will suit your lifestyle, give you financial independence, for additional income, to change up an industry, to sell to the highest bidder, to capitalise on an untapped market, to be your own boss, to help create jobs and uplift your community? Once you know the answer to this question you can plan your business goals accordingly. Writing-a-Business-Plan-How-to Start a Small Business-Starting a Business
  • Step two is to get to work on a business plan. You’ll find a template for a business plan here. Writing a business plan can seem like a daunting task, but without one, you’re jeopardising your businesses chances of survival and your investment. So what is it? It’s fundamentally the blueprint for your business. And while you don’t have to have a comprehensive business plan from the start, you need at least some elements thought out and planned, and then set about modifying the blueprint as the business evolves. Your plan should summarise what you intend to sell, to whom (including how big this market is and what their profile looks like), how much it will cost you to get going and run, how much you can sell the product or service for, who your competition is (their number, strengths and weaknesses included), who you will need to help run the business and what skills they need (will they be temp, part-time, full-time, outsourced?), what your projected sales and margins are, how you intend to market your product or service, and how you plan to operate and grow.

Stress test your small business idea

You’ll only know the strengths and weaknesses of your business idea if you put them to the test. A stress test, by definition is simulating stressors to see how something reacts and performs. In business, these stressors can be financial, by changes in the industry and target market etc.

Ways to stress test your idea is to walk through the entire process detail by detail to find gaps or weaknesses in the processes, to pinpoint who your best and worst customers would be, to analyse your marketing campaigns and any mistakes you might make, to meet with advisors for an outside perspective, to cut costs and see how the business performs, and set ambitious goals as these will not only help you determine what your business can tolerate, but can help you keep a competitive advantage.

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Starting a small business = A slow transition

Starting a business can seem like a risky move, particularly when you have a secure salary as an employee. While many entrepreneurs decide to dive straight into their new businesses by resigning from their jobs, this isn’t the only way. It’s possible to start a business of part-time while still employed. This route requires a lot of energy and discipline as you juggle responsibilities, and you must manage your expectations by understanding that a part-time business will take longer to reach its stride than a business you devote your full attention to. Many companies support employees working toward their own business goals provided it’s doesn’t impact on the hours and productivity you’re hired for, so it’s advisable to inform your employer of your intentions.

Know about legal agreements

In keeping with the transition from employee to entrepreneur, take a careful look at your terms and conditions of employment such as confidentiality clauses, non-compete clauses, and intellectual property agreements. The fastest way to end your entrepreneurial dreams is to come into conflict with the law and find yourself in court and/or bankrupt.

Have money in the bank

While many businesses can start with very little capital and run with low overheads, the rule of thumb is that a business can take up to three years to breakeven and see a return on investment capital. This means that while you may not need much to get started, you will need enough capital saved up to have working capital, kick start your cash flow, have emergency funds for repairs or purchases, and keep up with personal expenses like rent or a bond, school fees, medical aid etc.

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Small business owners need to reduce personal expenses

Having said you need to have enough funds for business and personal expenses until breakeven, it’s advisable for would-be entrepreneurs to scale back their personal and business expenses as much as possible to reduce the pressure on the business. Making sacrifices to discretionary spending and scaling back on living expenses also applies to members of your family, which can cause tension and conflict. Make sure everyone understands the purpose of reducing expenses to minimise conflict and help motivate saving.

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4 Black-Owned Businesses Participating in This Enterprise Development Programme That Are Growing – Fast

The Department of Small Business Development (DSBD) and Property Point have joined forces to take 16 small to medium-sized, black-owned, businesses, through a life-changing enterprise development programme.

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The Department of Small Business Development (DSBD) and Property Point have joined forces to take 16 small to medium-sized, black-owned, businesses, through a life-changing enterprise development programme.

In its first three months of operation, this programme has already seen incredible results with an average growth rate of 27% per business,  R17,8million in contract secured and 21 direct jobs created. This is a unique collaboration in that it is set up specifically to encourage access to markets for the beneficiary businesses and is the first of its kind in the industry.

But who are the people behind the numbers?  Meet four out of the 16 business owners , Thabiso, Falvia, Malusi and Mandla taking full advantage of this opportunity.

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Entrepreneur Today

How WordPress Can Help Your Small Business

WordPress is an amazingly large platform filled with incredible tools from useful plugins to intriguing extensions. It’s a platform for bloggers, social media influencers, and increasingly, small business owners.

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WordPress is one of the largest content management systems available. In fact, it powers nearly 30% of all US websites. Its ease of use and a open-source nature has prompted the platform to become overwhelmingly popular.

For many, WordPress is an invaluable resource that makes website management simple and promotes their brand easily. It is Little Wonder then that so many businesses use WordPress to handle their website and online presence management. Even though it is very popular, learning WordPress is an entirely different task.

Not many small businesses can afford to have a WordPress developer. In that case, it is important for many owners to learn as much as they can about WordPress.

Achieving effective market growth

There are those who still wish to use traditional services but are usually dumbfounded by the price and time requirement for making custom websites outside of the platform.

The abundant array of tools and applications makes using WordPress simple but effective for market growth.

For many businesses just starting out, getting traction and marketing growth are very difficult and can be taxing experiences if done by hand.

Related: 7 Ingredients Of Small Business Success Online

With a platform like WordPress achieving a beautiful website and pushing a brand is much simpler and easier than trying to do everything yourself.

Optimising your website with SEO

One of the most important aspects of business writing on a website is search engine optimisation or SEO. WordPress fortunately comes with a number of plugins that makes SEO very simple such as Yoast.

This service scroll through text and automates the SEO process to make sure your content is pushed to the best of its ability while also giving your brand the most exposure it can possibly take.

SEO is a very taxing and tedious process for many small business owners and the WordPress platform makes it simple.

Monitoring your website and developing leads

There is also the issue of monitoring who is coming to your website and who was looking at your products. again, on the WordPress platform there is the Google analytics plugin which allows owners to analyze who’s coming to their website and for how long.

This can be used to determine if your marketing or branding is effective and can determine what things need to change to increase exposure.

For small business, exposure is everything and awareness is the key to a successful business.

Increasing site security

Keeping a site secure is another main issue for people who run their own website and luckily WordPress has a plug-in for that.

Vaultpress, the premier security plugin, keeps your website secure and in the event of a catastrophic failure it can restore the entire site.

Business owners often fear their website crashing as it would reduce the amount of traffic it could garner and may interrupt their business practice. The WordPress platform has many tools which prevent loss of data or breaches of security so that your business can continue to run smoothly.

The benefits of using WordPress

These tools, mixed with a host of other utilities, make WordPress the premiere platform for websites for businesses of any size.

With its integration software you can automate messaging, simplify marketing and, optimise the speed of your website to give users an incredible experience without the cost of a full development team.

The technological age requires that all businesses must have a website or at least a web presence of some kind. it has been shown time and time again that a website is the best way to make a big impression on the consuming public.

Related: 10 Online Marketers To Watch In 2018

Time, as it moves slowly forward, shows us that the world will revolve around the Internet and technology. A web presence then, is not just a good idea or a trendy notion, but rather imperative to stay competitive in the future. To that end, there is no better platform to create a website on than WordPress.

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Government Funding

New Fund For Small Businesses To Be Developed

Government has allocated R2.1-billion toward the development of small- and medium-sized businesses.

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Driven by the Departments of Small Business, Science and Technology and the National Treasury, it was announced during the 2018 budget speech that entrepreneurs could unlocking funding for their businesses through a new funding initiative.

What is the new Fund?

Minister of Small Business Development, Lindiwe Zulu, explains where the fund stands and how it will work:

“The Fund will be operational during 2018/19 financial year but the planned disbursement of the funding will be the beginning of 2019/2020 financial year.”

She says R1 billion has already been transferred to the Department of Small Business Development from the national fiscus.

“The Department of Small Business Development together with National Treasury and Department of Science and Technology are working with the Government Technical Advisory Centre (GTAC) to develop the architecture of the Fund where issues around the management of the Fund will be considered,” she explains.

Related: Government Funding and Grants for Small Businesses

Who will the Fund be for?

“The Fund is targeting high growth businesses as our research on the ecosystem shows that there is a lack of funding of enterprises that are at an ideation and early start-up phase,” Zulu explains.

Her department together with the other participating arms of government, will identify areas of collaboration across research, mentorship and training of enterprises on financial management.

“The work that is being undertaken now will assist government to decide on how the fund will operate, but the government is conscious of the economic environment and would not look at setting up a completely new structure that will add to operational costs,” she says.

Addressing parliament on the fund, the minister said the financial mandate of the fund will be informed by the exercise that is being conducted through GTAC.

“Government is looking at having this fund as a soft loan which will provide affordable finance to small businesses and the emphasis will be more on ensuring that the Fund is sustainable rather than profit maximisation,” she explains.

Related: 11 Uniquely South African Business Ideas

How to apply for funding

Contact the following departments if you would like to access a portion of R2.1 billion:

Department of Small Business Development

  • Address: 77 Meintjies Street, Sunnyside, Pretoria
  • Tel: (+27) 861 843 384
  • Email: sbdinfo@dsbd.gov.za for information on the department and its services.

Department of Science & Technology

  • Address: DST Building (Building no. 53) (CSIR South Gate Entrance) Meiring Naude Road, Brummeria
  • Tel: (+27) 12 843 6300
  • EmailIsaac.Ramovha@dst.gov.za or zama.mthethwa@dst.gov.za for information and brochures about the department’s scope and funding.

National Treasury (GTAC unit)

  • Address: 40 Church Square, Pretoria
  • Tel: (+27) 012 315 5944 or (+27) 012 315 5645
  • Email: info@gtac.gov.za for information from the Government Technical Advisory Centre who will manage the small business fund for National Treasury.

Download a free Business Plan template here to get started.

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