Financial well-being October 21, 2026 By
There are many reasons entrepreneurs decide to start their own business. Perhaps you have an excellent product or service to offer. Maybe you are ready to be self-employed and become free from having immediate supervisors in a corporate structure. Whatever the motive, there are many important factors to consider, including:
- Determining your target audience and what forms of marketing are best for reaching that audience
- Creating a simple business plan that includes your financing and startup cash flow needs
- Defining your business structure
Many new entrepreneurs take the time to review these topics as they begin their small business journey. Let's discuss each in detail.
Understanding your target audience. Marketing can be an important part of building awareness and reaching prospective customers, but the appropriate strategy and budget will vary by business. When developing a marketing strategy, consider researching how similar products or services are marketed and testing different approaches to better understand your audience, market, and the potential viability of your product or service.
When developing your marketing budget, consider your overall operating expenses and the resources needed to better understand and reach your target audience. Social media can also be an effective tool for reaching and engaging prospective customers.
Creating a business plan. When developing a pricing model, consider your operating costs, anticipated expenses, desired income, market conditions, and realistic sales projections. Understanding the costs associated with delivering your product or service can help you evaluate whether your pricing strategy supports your business goals.
Keep the initial startup expenses low by being creative and thinking as inexpensively as possible. Consider purchasing only the items necessary to the business operation. For example, if your dream is opening a yoga studio or cupcake bakery, consider utilizing a community space or community kitchen during available off-hours to help reduce the cost of purchasing or renting a dedicated location.
If financing is needed, consider speaking with a lender at your local bank to discuss financing options that may be available for your business. Gather your personal financial statements (including all assets and liabilities) and your realistic sales goals and expenses. A lender can discuss available financing options and help you understand which options may fit your business's financial needs.
Determining your business structure. There are several business structures to consider when starting a business, and each may have different legal, tax, ownership, and liability considerations. The appropriate structure depends on your individual circumstances. Consider consulting with a qualified tax professional, CPA, or attorney when evaluating the structure that may be appropriate for your business.
Sole Proprietorship. A sole proprietorship is a business owned and operated by an individual. The business and its owner generally are not separate legal entities for certain purposes.
- Partnership. A partnership generally involves two or more persons carrying on a business together. The partners' responsibilities, ownership interests, liability, and tax treatment can vary depending on the type of partnership and applicable law.
- Limited Liability Company (LLC). An LLC is a business structure that generally provides its owners with limited liability protection. The federal tax treatment of an LLC may vary depending on the number of owners and any tax elections made.
- Corporation. A corporation is a legal entity separate from its owners. Corporate structures can vary, and their tax treatment, ownership requirements, and liability considerations depend on the type of corporation and applicable law.
Whether you're starting a new business or growing an existing one, a First United Community Lender can help you explore banking and financing options that may support your business goals.
- This information is provided for general educational purposes and is not intended to provide legal, tax, accounting, or financial advice. Consult a qualified professional regarding your individual circumstances.
