If you are new to business, you might think that the concept of business is foreign, but we forget that our ancestors were business people long before our own feet touched this land! While business is not easy, this guide will give you some tips on how to start a business.
Being in business vs a hobby
Sometimes a business starts as a hobby. You may be wondering, is this a hobby or is this a business?
A hobby is generally something you do in your spare time for pleasure or recreation.
A business is something commercial, where you aim to make a profit.
To help you decide if you are a business or a hobby, we've taken this assessment from the IRD, which is based on the following questions:
- Do you charge others for the goods/services you provide? Payment doesn’t have to be in cash.
- Do you supply goods/services on a regular basis?
- Do you intend to make a profit from providing goods/services?
- Do you plan, organise and carry out your activities in a businesslike manner, eg keep receipts and records, or have a separate bank account for your business activities?
If you are answered ‘yes’ to any of the questions above, guess what... You are in business.
Steps to take to start your business
1. Conduct market research
Market research will tell you if there’s an opportunity to turn your idea into a successful business. You need customers that are willing to purchase your goods or service to have their problem solved.
2. Write a one page business plan
Your business plan makes up the foundation of your business. It acts as the roadmap for how you will reach your goals.
3. Create a budget and forecast
You need to know how much money it will take to start your business and how much money it's going to make
4. Fund your business
Once you know how much money you need to fund your business, you'll need to work out where that money is coming from
5. Choose a business structure
The legal structure you choose for your business will impact your business registration requirements, how much you pay in taxes, and your personal liability.
6. Get started
Once you've done the above you can kick start your business!
Starting a business reminds us of when our ancestors would prepare for a voyage, this is just the beginning! The steps to starting a business are like deciding what boat to use, where you want to voyage to, checking you have all of the resources needed for the voyage and if not, how will you get them.
We hear the statistics all of the time – most businesses fail within the first five years. WE’s goal is to change those dismal statistics by helping you to navigate the choppy waters and ensure you and your business are set up as best as they can be, to increase your chances of success.
