Rocket launch analogous to starting your own business

2020 Ultimate Guide to Starting Your Own Business

Here’s your guide explaining how to start your own business (big or small) in 2020. I’m giving you all the knowledge I gained starting 3 businesses and having 2 of them work in Ontario, Canada (Halton Region and Brampton). The concepts apply in Canada and, to a degree, the United States.

Read the whole thing first to get an overall understanding of the process. Then hit each point, step by step. As a final note, I’ve tried to simplify everything as much as possible. However, I wouldn’t say this article is for dummies. You certainly are not if you want to escape the rat race your own way!

This article covers your mindset (Part 1), the items you need to prepare to start your business (Part 2), reinforcing your motivation (Part 3), executing your plan (Part 4) and the technicalities of starting a business in Halton Region, Ontario, Canada. If you know anyone who would benefit, share this article with them.

Part 1: Before starting a business

Should I start a business?

Why do you want to start a business? You have admit to yourself whether you simply want a new job, a new place to work, a new career, or if the only way you want to serve others is through your own business. As a quick check:

  • Love what you do, but hate where you do it? You need a new place to work.
  • Do you enjoy where you work, but hate what you do there? Don’t quit. You simply need a new job at the same place.
  • Do you hate where you work and what you do? You need a new career.
  • Have an idea that no boss will ever agree to? Look into starting your own business.

If you’ve decided that you must start a business, read on.

What should I do from here?

First, understand how to set and achieve your goals. You will not start a business without goals. Read the 2020 Ultimate Guide to Achieving Your Goals and the One Productivity Trick to Outrun Everyone to understand how to do this.

Next, make it a goal to answer the following points. You need to set aside time for this everyday until you find the answers.

  1. What do you enjoy doing in your free time?
  2. List all your talents
  3. List all your skills
  4. What are your interests?
  5. What are your experiences?
  6. Are you subject matter expert on a certain topic?
  7. Based on everything above, how can you help others doing what you love?

This last question is the ultimate question. This is not a two part question. I’m not asking:

  • “What do you love to do” and
  • “How can you help others”

I’m asking, “How do take what you love to do and help others with it?” Again, how do you change other people’s lives doing what you love? If you love your work, you’ll get through the hard times. And if your work helps others, you’ll make an income. Get the answer to this last question right, and your path forward is setup.

You will get all you want in life, if you help enough other people get what they want.

Zig Ziglar

Who are the people I can help?

Finding your niche market

The people who can purchase your products and services is called your total market. However, not everyone in the total market will be within your reach. Some may be too old, others too young and others too far away. The ones with whom you’re most likely to sell to within this total market is called your available market. Now, not everyone in your available market may be interested in what you offer. The ones who are interested is called your target market.

And finally, if you can segment your target market ever more finely, you’ll get your niche market. A niche market is a group of people that share a very specific problem/interest that you can help with. This is the group of people you want to help.

The benefits of targeting a niche market over larger markets

Why? Because they share the same mindset and problems, you can more easily personalize what you offer to address exactly what they need. You can’t do this with your total or available market because they’re interest and motivations are too broad. Honestly, trying to help your available or total market is like trying to shoot five arrows at one time. You’ll miss all your targets. Shoot one arrow at a time and you’re more likely to hit your target.

An example of a niche market

As an example, say you want to run a bakery in Oakville. Your total market could be everyone in Canada. However, not everyone in Canada is going to fly to you. The ones you’re more likely to reach would be within a 15-minute driving distance of your anticipated location. The number of people here is your available market. But, not everyone will want your baked goods. Maybe you specialize in pastries. Only those interested in pastries will come. That’s your target market. And finally, perhaps you want to specialize in pastries made with fair-trade, non-GMO or locally farmed ingredients. The ones from your target market who are interested in that is called your niche.

For a great discussion on this topic, watch this video by Miles Beckler.

Part 2: The ground work for starting your business

Define your vision

Now that you know what business you want to start and who you want to help, you’ll need to establish your vision. Your vision is about the ideal future you want to create. What is this impossible future you are striving for? By starting your own business, you are becoming a leader, and as I mentioned in the leadership article, people only follow those with great confidence and bodacious goals.

Define your mission statement

How are you going to achieve this vision? Your mission statement shows how you’re going to make that unrealistic vision, realistic. I don’t think any person today thinks they can start a rocket company that would get contracts from NASA, and yet that’s exactly what happened. Elon Musk set a bodacious vision and approached it with a realistic mission.

Define your value proposition

Who is your customer? Refer to your niche. What is their problem? How will you solve it? How are you different from the competitors? Take the answers to those four questions and merge them into a coherent statement that lasts for 30 to 45 seconds. This is your value proposition and you can use it as your elevator pitch. When someone asks you what you’re working on, you recite your value proposition.

Write up your business plan

Your business plan is basically your battle strategy to creating your own business and surviving the trials of entrepreneurship. It will cover your idea, your background, you market size, your marketing, human resources and operational plans, and your risks and solutions among other things. Use the following resource to start writing your business plan. As time passes, you’ll need to make adjustments to your plan, but starting the plan now will force you to think about those important points just mentioned. Work on this with diligence. How much effort you pour into your business will dictate how serious you are about your business.

Write up your cash flow analysis

I’ll be developing a cash flow resource that you can download. But for now, look up a good spreadsheet template where you can add all your revenue sources and all your expenses, and see your net profit per month for two years. Just like the business plan, as you get more experience and ideas, your cash flow analysis will need to to be updated. The cash flow analysis will force you to consider how you will make your business profitable. Without profit, your business will not succeed.

Determine how much financing you need

Your business plan and cash flow analysis will force you to sit down and determine how much money you need to start this idea. It will also force you to consider where you’re going to get the money from. Perhaps the easiest I can recommend is a business bank loan. People fear taking loans, but unless you’re willing to overcome this fear, starting a business will be very difficult. Financing (such as through loans) make it possible to expand! To help overcome your fear, I highly recommend reading RIch Dad, Poor Dad by Robert Kiyosaki.

If you have any debt you have trouble paying, you need to keep working at a job until you pay all of that off. Banks will not give you loans if you have poor credit history.

Acquire experience in the field

Do you have the experience in the field you want to pursue? No? That’s okay. Are you at least partnering with someone who does know the industry? No? Now, it’s not okay. It’s great if you want to start a restaurant, but if you’ve never worked in one, don’t assume you can theorize your way through it. Either find someone in the industry who will work with you or get a job in the industry. Start from the bottom if you have to. For now, let’s assume you need to get a job in the industry.

Get your spouse’s approval

Before you do, if you’re married, you need to talk to your wife. You need to get her clearance before anything else. Look, I don’t care if the rest of the world says to go on with your idea, your marriage should be your top priority. If you fail in your marriage because you did not prioritize it, your success in business is worth squat. This is even more important if you have kids.

Cut down your expenses

Assuming your wife agrees, if the pay cut to your current salary is significant, prepare for it. Cut down your bills. Unsubscribe to Netflix, Disney+, Prime and any irrelevant entertainment program you’re using right now. If you’re at home with your parents or wife, ask them to cover the short fall while you start from the bottom. I cover this in more detail in the guide to quitting your job.

Go out and get that experience

Your plan is to work here, until you save up enough money to support yourself for 6 months if you had no job. The idea is to build up your savings while gaining industry experience.

Part 3: Prepare to launch your business

While you’re working on the above, prepare the next steps.

Cut out the noise

You’ll be tempted to share your idea with your family and friends. Don’t. Right now, the only thing that will keep you going is self-belief. If you speak with others, you will start to fill up with self-doubt, and I guarantee you your idea will collapse and you will not see this through. You only need to mention your idea to a few people:

  • Yourself
  • Your wife
  • Your mentor
  • Anybody who is supporting you so you can get this idea off the ground
  • Anybody who has achieved what you’re hoping to achieve

You absolutely cannot allow yourself to be filled with self-doubt. Read Chapter 7 of Rich Dad, Poor Dad. Read Chapter 1 and 2 of the Miracle of Right Thought. And read the whole book, Release Your Brakes! As long as you’re smart about your idea, as long as you’re being flexible, as long as you’re seeking more information to back up your decisions, you’re heading on the right path.

Goldwyn & Sons - Pexels - runner getting ready to escape the noise similar to what you need to do to start your business

Self-doubt is the enemy. The single reason no one achieves greatness despite the opportunities given to them day in and day out is because they don’t believe in themselves.

Reinforce your goals

Make sure you have a daily routine for your business. Everything mentioned above and below are goals you must hit. It takes a daily routine to achieve these goals. So, make sure to set up your goals and daily schedule. If you don’t, you will not create your own business, period (the fact that I’ve linked to the same article on goals multiple times tells you how important I find this to be).

Find a mentor

Go to the city and find out if they have a small business department. Ask them if they offer free consultant services. In Halton Region, they offer free business consultations where small business advisers will review your whole business with you. If you don’t have this, look for a mentor, someone who has achieved what you want to achieve.

When you find your mentor or adviser, and they’re willing to help, ask them if they can review your business plan to see if you’re on the right track. If you can meet with them monthly (as I could with Halton Region), then make sure you do it. Otherwise, you’ll slow down and slowly give up on pursuing your business.

You need someone to answer to – that won’t take your excuses – and that’s what the mentors and advisers are for.

Find out if you need any professional licenses

Check if your business requires any professional licenses. You don’t want your business to be shut down because of some legal mistake. As you’re already working in the industry or working with someone who does, use those resources to find out what professional licenses you need.

Part 4: Go, Go, Go!

By this point, you’ve saved up 6 months of income, you’ve gained industry experience, you’ve finished your business plan and cash flow analysis and you’re regularly meeting with your mentor/adviser. This is excellent.

Now it’s time to get your idea from your spreadsheet into reality. This is what your business plan is for! If you’ve worked on it with the diligence I recommended, you’ll already have all the next steps laid out. You just need to follow the plan! Whether your business is online, at home, or is a store-front, work with your mentor/adviser and execute your business plan.

Goldwyn & Sons - Pexels - Paperwork to start your own business

The technicalities of starting a business in Halton Region, Ontario

Going forward, all of what’s mentioned here below is for Ontario, Canada and Halton Region in particular. But, this information will serve as a template wherever you are in Canada and, I believe, the United States.

Every city has their rules about starting a business. If your business operates a store-front, or deals with food, manufacturing, medicine, or child care, you need to contact the city about the requirements to starting a business. If you’re not sure if you should contact the city, contact the city.

Physically go to city hall and ask them what you need to do to open your business. For Halton Region, they gave me a form with all the required paperwork. Here is a list of some of the paperwork you could be asked for.

Business paperwork

In Ontario, Canada, there are 3 types of businesses: a sole proprietorship, a general partnership and a corporation.

  • If you decide to start your business as a sole proprietorship or a partnership, you’ll need to register your business with Ontario. The city will want a copy of this registration.
  • If you decide to open a corporation, you should talk to a lawyer about whether you need to federally incorporate or provincially incorporate. The city will want a copy of your incorporation papers.

Industry Licenses (various)

If you are working in a regulated industry, you’ll need to provide proof that you meet the regulations. Ask the city about this.

Liquor Sales license from the AGCO: If you plan on serving alcohol, you’ll need to apply for the Liquor Sales license from the Alcohol and Gaming Commission of Ontario (AGCO). To get that, you need to complete the Smart Serve program. The city will want a copy of this license.

Food Handler Certification: If you plan on serving food, you’ll need to acquire your food handler certificate. The city may want a copy of this certificate.

Zoning Certificate of Occupancy

The city has determined where specific businesses can operate. It doesn’t want all automotive manufacturing businesses to be in residential areas or bakeries to be beside chemical factories. They want the city to be laid out strategically. For that reason, they break the city up into areas and assign each area a zoning code. This code designates what businesses can operate within that area.

For example, a barber shop falls under a personal services zoning code and can only be opened in those regions of the city with that zoning. Here’s the zoning map for Oakville and here’s the associated zoning codes. To see if your location of interest is zoned for your type of business, the best option is to call the city’s zoning department, give them your address and get a verbal approval. Once you actually find your ideal location, you can apply for a zoning certificate of occupancy before signing the lease. The city will want a copy of that certificate.

Building Permit

If you’re going to lease a space for your business, the unit you’re thinking of leasing was built for a specific purpose. Therefore, if you’re changing anything around in it, you’ll need to talk to the building department to see if it’s allowed. If you get the green light, you can start construction. Otherwise, if they see you doing renovation work without a permit, they may stop you mid-way. After you finish construction, they’ll inspect the structural, electrical and plumbing work done on your shop and assign you the appropriate permits. The city will want a copy of those permits.

Proof of insurance

Business insurance is to protect you in case of lawsuits or liabilities. If you’re sued for something, you’ll have insurance to protect you. You just need to contact an insurance company that can provide you the insurance the city wants. In Oakville, for a barbershop, they requested general liability insurance with a coverage of $2,000,000 with the City of Oakville as an “additional insured”. Speak to an insurance company. The city will want a copy of the certificate of insurance.

Health inspection permit

When you are about to open your location, the health department will want to ensure your place is safe for the public. That means one thing for restaurants and another for barber shops. As a result, you must visit the health department, tell them your idea and ask them what you need to do to pass the health inspection. Shortly before your location opens, they’ll inspect your property and give you a permit. The city will want a copy of this permit.

Payment for your business licence

Once you’ve provided all the paperwork, you’ll need to pay the city to get a business license to legally run your business.

The big thing to note from the list above is that the various departments (zoning, health, small business, etc.) do not always know the complete process of the other departments. I’ve encountered cases where what they say doesn’t line up with what the other departments say. So, it’s best to visit each department to find out what you need to do to get the needed paperwork (such as certificates and permits) from them.

Start your business in 2020!

At this point, you have everything you need to start your business. You have a verified road map to kick off your journey (business plan) and a fire under your rear to make sure you keep moving forward (your mentor/advisers and daily routine). Now, work with your mentor/adviser and start executing your business plan!

Book Recommendations:

Release your Brakes! by Jim Newman

You can read this and other articles on LinkedIn.