How to Start a New Business After Graduation

how to start a new businessNow that you’ve finished school and have a degree, it’s time to get busy. Most recent graduates will start looking for a job immediately in order to begin paying off student loans and get their lives moving forward. Others think a bit differently. Instead of working for someone else, they prefer to start their own business. If you fit into this category, you may be interested in these tips on how to start a new business after graduation.

Reality Check

Unless you or your family is independently wealthy, your dreams of starting a new business as soon as you graduate may be unrealistic. Running a business is stressful enough for experienced business people. For you, just starting out, there are bound to be any number of issues you fail to address. The message here is, ‘don’t rush into anything.’

Start Planning While You’re Still in School

In order to have a realistic shot at operating a successful business, you need to have a business plan. Don’t wait until you graduate to formulate it, start planning while you’re still in school. Most people who intend to start their own business study business and economics in college. If you’re not a business major, it wouldn’t hurt to take a few classes to better prepare yourself for the business world. Pay attention in class and gather all the information you possibly can.

Seek out the counsel of people who are already business owners. If possible, get a part time job with a company whose ownership you respect so you can learn their business methods. If getting a job with that company is out of the question, ask if you can shadow a manager for a few days. Any actual experience within the business community will go a long way towards preparing yourself for operating you own business.

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While you’re putting together your business plan, don’t forget to consider how you’re going to advertise the business, and as part of your preparation for opening a business, you may want to think about your accounting system. Unless you can afford to outsource your accounting, you may be forced to do it yourself. Either way, taking a few courses in accounting would hurt.

Funding Your Business

Back to the reality check; unless you have a lot of money of your own, you’re going to have to find funding to open your business. Again, it would be a good idea to begin this process well before you graduate from college. Having a well thought out business plan can be instrumental in securing funding for your business. The more thorough you are in developing your business plan the better your chances are of having lenders take you seriously.

The amount of money you’ll need to start your operation depends on the type of business you intend to start. You’ll need to figure out how much start-up capital you’ll need to carry you through until the business can begin producing a profit. Unless you have an outside job, you’ll also have to consider how you’re going to support you and your family until the business takes off. Consulting a financial planner and an accountant will help you realize whether or not your plan is realistic or whether it needs a little tweaking.

Locating Funds

Once your business plan is formulized and you’ve determined how much money it will take to make the operation profitable, it’s time to try and locate the funds you’ll need to actually open the business. Depending on the size of your operation, you may be able to get a loan from the Small Business Administration or from your local bank. Your credit rating will be vital in this process, so hopefully you’ve managed to establish a good credit score. Without it, your chances of getting a loan from a traditional source are greatly diminished. If someone in your family has the resources, you may want to consider approaching them for a loan. A lot of people who open new businesses continue to work at full time jobs while the business becomes established. Since you’ve recently graduated from college, you may have to find a job to tide you over until the business is up and running and showing a profit. This could mean working nights while you concentrate on your new business during the day.

Business Requirements

When formulating your business plan, don’t forget to factor in the necessary licensing and other governmental requirements for opening and operating a business. Each state has different rules, and there are federal regulations that pertain to operating a business, as well. Your county government may also have certain rules you’ll need to abide by. Before opening the doors of your business, you will need to check with the various governmental offices to be sure you meet the requirements.