Starting A Business In B.C. - 6 Step Process To Get It Right, The Fist Time.
Have you always dreamed of being your own boss? Are you tired of managing someone else’s business?
Why not start your own?
In BC, registering a business is easier than you might think. There are a few critical steps that need to be taken to get things off the ground.
1. Recognise an unsatisfied need
First things first, you need to start by finding a gap in the market. Now, this can come in many forms. For example, you can invent something that people never had before but will change their habits forever or you can serve a population that is either not being served or is underserved in a particular area. Once you have figured out what gap you’re going to fill, the next step is to really get to know your customers, inside and out. This way you can develop your sales strategy to fit with their unique profile. Finally, you need to address the market for this need. To do this, ask yourself three questions: Would people want this? What would they be willing/ able to pay for it? Does that price allow for my business to produce our product, fund our operations and have some left over for me? That is where step two comes in.
2. Start with a plan
Before you invest your time and money into starting a business, you need to make a plan. This is usually a combination of a business plan and a financial plan. This is where you will, in detail, answer the three questions of need (see above). Once you are able to answer these questions, you then need to map out the steps you plan on taking to get there and when you are going to start seeing a return on your investment (if everything goes according to plan). Business and financial plans are especially important if part of your plan includes bank loans or outside investment; or if you are hoping to enter into partnerships with manufacturers or suppliers. People loaning you money or buying a part of your company will want to know that their investment is protected. At the same time, other businesses don’t want to be associated with failures. Stating your plan and determining what you need to do to be successful will force you to ask yourself the tough questions about your idea. It will force you to test whether or not you really know the market you are entering into and how receptive your identified customers are to your idea.
Don’t spend too much time just thinking about this! Test it, build a minimum viable product and ask customers for feedback. This way you can go back to the drawing board and try again if an assumption you made didn’t turn out how you thought it would. Remember that your plan is a fluid document, it will grow with your business. The key is to make your idea real and keep yourself accountable to it. This will also immensely help you better explain your idea to anyone you meet, helping to grow your team.
3. Figure Out The Name
What is in a name? Everything. It is going to be the first thing that your customer sees and hears. The best names don’t try to be clever. Unless you are inventing something new, that people will associate only your name with it (i.e. Google) then get straight to the point. Making company names too complicated or obscure prevents people from remembering who you are, what you do and what makes you special. If you have to explain what you do every time a new customer calls you, then maybe you are a bit off target. Just keep it simple and to the point.
Once you have something, check to make sure it hasn’t already been taken, this can be as simple as a Google search or using Name Request Online in B.C. If you are planning on taking your company global, check with the Intellectual Property Offices of Canada to ensure that your awesome name idea hasn’t already been trademarked by someone else. The best way to avoid this is to have two elements to a name, one distinctive and one descriptive. This way people will know what you do and differentiate you from the competition (i.e. ).
4. Establish the Legal Structure
How businesses are structured is very important and can have very profound effects down the road if it is not done correctly. There are three ways to structure your business. They include Sole Proprietorship, Partnership and Corporation. The most important part of defining the structure of your business is determining how it is going to be governed. Obviously, a Sole Proprietor doesn’t need an agreement, but I would still recommend setting expectations for yourself so you know what standards you need to live up to. If you can’t meet your own expectations, it means it is time to make changes in the business (grow the team, expand markets or worse case, shutdown). If you are starting a business with other people, an agreement is crucial. Starting out, everyone is friends and things are running smoothly, this will not last forever. When Sh!t hits the fan, lacking proper structure can lead to disaster. Start with something basic but thorough. Think through every possible scenario from having to fire your best friend to accidental death or debilitation. Put all your personal stuff aside and make sure every partner is covered under all circumstances. This can get nasty, especially when friends are involved but trust me, without it, you are setting yourself and your business up for destruction.
You can find some basic agreements using services like Lawdepot.com (disclaimer, this is an American site but a lot of the principles are the same) or talk to a business specific lawyer. An agreement can usually run you around $1,500 - $2,500 depending on the complexity of the agreement. However, it is worth every penny.
5. Register The Business
In BC and most other places, this can be done online. If your company is a Sole Proprietorship or a Partnership, it is straightforward and relatively easy to set up. If you are looking to register a Corporation, it can be registered online but that is usually included in what the lawyers charge you to set up the corporation (recommended). Once you have an approved name, you can actually register your business with the province, get your tax accounts with the CRA and apply for a municipal business licence all in one place (and a perfect example of a great name) BC OneStop Online. Most registrations take less than half an hour and are free. Once you receive these registration numbers, print them out and stick them on your wall. This is really important because you will need them a lot in your first year in business.
6. Congrats! You own a business. Now what?
Way to go, you’re now the official owner of a business! Many have made it this far but only few make it past their first year. so keep you momentum moving forward. Put yourself out there and make that elusive first sale. Your journey has just begun but I promise you, it will be worth it in the end. Thankfully, I will be here every step of the way with helpful hints and timely advice to keep you business moving towards its peak. Stay tuned for my next blog post.