The majority of new small and medium businesses fail. Generally, because they suffer from a lack of planning. Thus, take into consideration that if you start your business responsibly and well-prepared, and organized, chances of the success of your business will increase significantly. 

To start a business effectively, you must consider many factors, such as issues regarding financial, legal, marketing, and human resources. With this guide, we managed to present all the steps that beginner entrepreneurs should take to ensure effective planning and establishment of their business.

Understand the challenges of starting a business

First of all, it is necessary to understand what resources are required to start and manage a business. Readiness for challenges avoids unforeseen issues and barriers that arise in the early stages of starting a business.

These challenges include key business issues such as:

• Creating a unique and competitive product or service;

• Define a detailed preliminary plan for product development and customer delivery;

• Gathering employees who understand the goals of the company and are ready to contribute to the development of the business;

• Effective time management;

• Pre-arranging revenue sharing between business co-founders to reduce the chances of uncertainty and resistance among future business owners.

Choosing a name for a business

Choosing the right name for a business is another crucial part of starting a business. Try to choose a simple and creative name, but at the same time try not to choose a very specific name, as this may limit the business development process (for example, avoid mentioning a city or a specific product in the name, as your business may even include other locations and products in the future). Before making a final decision be sure to check if another business is using the same name. You can also check this through ".com" or ".ge" domains.

Try to associate the name with your product or service. You can also think about how you stand out from the competitors in the market. Keep in mind that often presenting your activities and product correctly is more important than creativity. The name of your product or service should indicate what type of product you are creating. While selecting a name for your business, you can also specify for whom your product is created.

To choose the best option, be sure to conduct a small "survey" between relatives and employees to get a better idea of the preferences of potential customers. After deciding on a name, establishing other components of branding is also important. Branding is a marketing practice that involves creating a company name, logo, and design. Through branding, you will be able to shape and change how consumers perceive your brand. When choosing a logo design, try to effectively express the identity and attractiveness of your company's product or service. Picking an eye-catching logo will also help you attract new customers and increase the awareness of the business, which will directly affect the future sales of the product. 

Market analysis

Before starting a business, it is necessary to observe the companies, which are already in the market, to understand well what they offer to customers and how your product differs. As a result, you can define what position your business will take in the market and how you will be able to differentiate a product or service. At the same time, market analysis will simplify the classification of potential customers. Eventually, it will become easier to understand their desires and behavioral patterns and to select the optimal location for the business, if necessary. Primary and/or secondary research of potential customers can help you get more information that can help you improve your product or service.

Apart from that, with the help of market analysis, you can make sure that the business idea is unique or observe, if any, what became the reason for the failure of such an idea, try to learn from the mistakes of others, and accordingly plan the process of business formation and operation. If necessary, you can also contact a group of professionals when compiling a business survey.

Keep in mind that when conducting business research, you will need to analyze the following factors:

• Comparing products, enterprises/competitors in the market, writing down their strengths and weaknesses. You can get the information by observing prices, marketing strategies, and company characteristics.

• The volume of the industry, the study of local production, about which you can get information from the reports of various research organizations.

• Analyze the characteristics of customers, target segments, and buyers, which you will be able to observe through already existing analytical studies or from the surveys conducted by yourself. 

Analysis of the legal structure

First of all, registering as an enterprise is a necessary procedure that your business must go through. The registration service in Georgia is provided by the National Agency of Public Registry. Before choosing the type of entrepreneurial entity, it is necessary to understand what property liability falls on the owner of the enterprise and what are the advantages and disadvantages of registering as a specific entrepreneurial entity. For example, in order to choose between an individual entrepreneur and a limited liability company (LLC), you need to consider their characteristics, advantages, disadvantages, and what documentation is required for registration. Often, to avoid potential problems, it is best to consult with professionals about these issues.

It is also important to know the types of tax regimes and in which your business falls. Taxes may include income tax, profit tax, excise tax, import tax, and property tax. In addition, obtaining licenses for state-regulated activities (for example, use of natural resources, foster care, and private and community broadcasting) and permits (e.g., outdoor advertising, construction, and environmental impact) should also be taken into consideration.

Creating a business plan

Based on the above information, before starting a business, it is necessary to prepare a business plan, which should also include the action plan, SWOT analysis (analysis of strengths, weaknesses, opportunities, and threats), risk analysis, evaluation of potential problems and the possible solutions for them, start-up cost analysis, forecasts of revenues and expenditures, planning finances, start-up capital calculation and strategies for attracting funds. An effective business plan creates an opportunity for you to present your ideas, implement them, and obtain funds for creation and growth.

Nevertheless, businesses must be constantly prepared to deviate from a pre-created business plan in the event that new opportunities or challenges arise in the market during the development process.

Developing the marketing strategy

The key to business success is to effectively deliver product information to customers, hence marketing strategy plays a crucial role in setting up and operational process of a business.

Marketing is a broad activity and includes strategies for promoting and selling your product, selecting a potential customer segment, and considering the consumer preferences and desires regarding the product. A marketing strategy should also include a sales plan, customer engagement tactics, and product or service branding. Creating a well-maintained website based on customer experience and the interface is one of the important aspects that simplifies customer relationships and increases customer satisfaction.

Given the challenges and the rapid development of technology, the use of digital marketing may prove to be particularly effective. For this, it is necessary to select the right platform for advertising at the initial stage, considering the segment of consumers. For example, if your business deals with educational issues, it would be optimal to focus mainly on digital marketing on Linkedin and Facebook, as potential users often receive information about various lectures/courses or training through these platforms. And if you are trying to advertise handmade products (for example, accessories and clothes), in addition to Facebook you can also use Instagram advertising strategies for more efficiency.

Getting consultations from professionals

Finally, it should be noted that getting complex services with the help of a team of professionals before starting a business may be extremely beneficial for the successful operation of start-up businesses. With the help of experts, start-up businesses will be able to get a detailed assessment of market challenges, customer demand, and strategies needed to manage sales effectively.

Involving consultants and freelancers in the early stages of startup development will result in the decline of business management problems while avoiding recruiting additional full-time employees.

Remember that starting a business is associated with significant responsibilities and difficulties. Therefore, at the initial stage, try to plan well the issues related to starting and managing a business, follow the above-mentioned tips, and always be ready for new challenges.