Have you dreamed of starting a business, but you're not quite sure where to start or what to consider? No worries! We have gathered together the 10 most important steps to start a business. Starting a business is an exciting and challenging process, but with these you can realize your dream of owning your own business and control your own work.
1. A clear business idea
Before starting anything else, make sure you have a clear business idea. Think about what kind of products or services you want to offer and to whom. It is also important to know how you produce your product or service and how you can stand out from your competitors. A clear business idea helps you visualize the whole and understand what kind of demand there would be for your company.
2. Business plan
Your business plan is an important starting point when starting a business. The purpose of your plan is to justify your idea to yourself and to potential investors, that your company is profitable and can make a profit. A good plan includes cost mapping, customer mapping and budgeting. The saying "well planned is half done" is very true when it comes to a business plan, because the plan is one distinguishing factor between your business activity and your hobby activity. Even if your dream is not to get rich, your business must be profitable.
3. Company form
When starting a company, one of the most important decisions is choosing the right company form. The choice of company form is influenced by, for example, the capital required by the company, the scope of operations and taxation.
One option is a business name, which is a good company form for a small company that does not need large acquisitions. A business name is easy, fast and inexpensive to set up, but the entrepreneur is responsible for the losses themselves, and personal funds and company funds are the same thing.
Another option is a limited company, which is suitable for a company that needs large investments. In a limited company, the shareholders are liable with the capital they have invested in the company, and are not personally liable for the company's debts. The limited company has a board of directors elected by the owners, which takes care of the company's operations.
Light entrepreneurship is also a popular option. A small business owner invoices the customer through the invoicing service, and does not need a Y ID. Light entrepreneurship is an easy way to test the profitability of a business idea, and invoicing services take care of all financial matters.
It is important to consider the company's needs and goals when choosing a company form. Choosing the right company form can affect the company's success and growth. It is also important to take care of proper accounting and taxation, whatever the company form. Despite everything, you can change the business form later, especially as the company grows.
4. Licensing
In some sectors, a separate official permit is required to establish a company, although in general in Finland it is allowed to establish a legal business without major permits. For example, restaurants, shops and repair shops need inspections and permits from the health authorities. Remember to familiarize yourself with the requirements and, if necessary, notify the authorities about starting your company.
5. Company name
A company name is an important part of business operations, and it should be memorable and distinctive. You can use your own name or an invented name in the business name. The name of the company must not mislead or give false information about the activity. Depending on your business form, the name also needs to be approved by PRH, i.e. the Patent and Registration Board. Their website (www.prh.fi) is a budding entrepreneur's best friend, and you should get to know them carefully.
6. Funding
Financing a new business can be tricky, but securing it is especially important. If necessary, get financing in the form of a bank loan, start-up money or funding from Business Finland, for example.
7. Accounting
You can handle the accounting of a small business yourself, but many have outsourced it to a professional. Paperwork can be really complicated and challenging, but it's good to learn a little about the subject so you understand your company's cash flow. Remember to carefully monitor your company's finances and record all transactions.
8. Statutory pension insurance
An entrepreneur living and operating in Finland must be insured against old age, disability and death. YEL insurance is statutory and it provides security in case of illness, unemployment or retirement, for example. Those who become entrepreneurs for the first time receive a 22% discount on YEL payments for the first four years. It is worth noting that the insurance premiums are tax deductible. If you have employees, you are also responsible for their insurance.
9. Personnel
Think about whether you need personnel, for example, for a certain deadline, during peak times or for an employment relationship that is valid until further notice. If you need personnel, remember to take care of the side costs of the salary as well. Overall, labor costs can be up to 40-50% of the result, depending on the industry.
10. The courage to start
With these things in mind, you are ready to start your business. Remember to develop your plan regularly as your business develops and be bold in making your dreams come true. Starting a company requires a certain kind of self-discipline, and you shouldn't write your dream completely ready on paper before starting. Believe in yourself and let go!
Good luck!
