Getting an idea off the ground is one of the toughest parts of being an entrepreneur. Formalizing it into a business takes a lot of research and advice on which path is best to take, especially if you did not get the chance to study it in school. A feasibility report is usually used to determine certain details of the venture. It can help sort out the type of company being established, the structure of the organization, the roles of the employees, and any jobs that can be handled externally to cut down on costs.
Type of Business
There are different kinds of business organizations. Whichever one you choose depends on several factors, namely: ownership, taxes, liability, and registration. The 3 main types are sole proprietorship, partnership, and corporation.
The smaller the company, the fewer taxes it will have to pay, and the fewer forms it needs to fill up. Under partnership and corporation are varying structures that indicate the extent of the liability the owner or owners is willing to be responsible for. It is up to you or your team to determine which structure will work best before moving forward with the venture. This can help avoid disputes later on since the ownership of the company would have been agreed upon.
Functions of Each Unit
You might have noticed that companies usually have departments or divisions to organize themselves. It will be an easier mode of communication since it establishes a linear line to wherever messages need to be relayed. The employees are typically divided based on their role in the company, strengthening certain aspects of the business.
For instance, a sales and marketing team will be stronger and more cohesive if they all work in the same department, rather than having a lost team member in the production department. Identifying the key sections of your business structure can ensure that any process will go as smoothly as possible. It will also help to underline the responsibilities of each unit so that if there are any hiccups in the future, they will be a lot easier to identify.
Taking Care of Employees
Before any employees are hired, any employer needs to be thorough in the following aspects of their job:
1. Identify their roles and responsibilities.
Employees need to know what to do. Informing them of their roles and responsibilities once they are hired will be easier if it was already sorted out in the feasibility study. They will also have a clear idea of what the job entails. This will help them make an informed decision before applying for the job and reduce the resources needed when a company is trying to fill a position.
2. Explain the qualifications and compensation.
Again, providing job seekers a clear idea of who and what the company needs can help save resources during hires. Only qualified candidates will apply and be interviewed. Identifying the qualifications and their compensation is a way for the employer and the potential employee to be on the same page at the very start. It will also save the business money if the people being hired are qualified for the job since they will not need as much training as someone unqualified.
3. Research the labor laws.
There are relevant laws that affect both the employees and candidates for a position. Anti-discrimination is a common lawsuit case, so it would be best to read up on what to avoid. This will help prevent the business lose money unintentionally in the future. Aside from anti-discrimination, looking into the legalities of salary, vacation, and safety will make any business owner prepared for their duties as an employer.
Professional Firms to be Hired
Start-ups do not have a lot of funding to begin with. Even though business owners have a fixed structure in mind, they cannot always afford to fill in all the positions as soon as the operating period begins. Most entrepreneurs find themselves wearing a lot of hats in the beginning.
Fortunately, there are specialized roles that can be handled externally. For example, outsourcing the finance and accounting aspects of the company can help handle the books without having someone on permanent payroll. It saves the business money while achieving the professional service that it needs.
If you have difficulties being decisive about the aforementioned, you need to power through the process and figure it out, whether you are by yourself or with a team. Any entrepreneur needs to be adaptable to a startup’s challenges, including formalizing the business.
