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Guide to starting a small business

Published on July 12, 2017 10:38AM

Planning is critical to successfully starting and building a business. Here is some guidance on the tools and resources necessary to start your business.

Small Business Administration (SBA) suggestions to get ready (

How do I get started in a business?

SBA provides a wealth of information on starting a business at under “Small Business Planner.” You will find information on writing a business plan as well. Take advantage of SBA’s resource partners. The Clatsop Community College Small Business Development Center (SBDC) provides free one-on-one counseling to those interested in starting and expanding a business. This includes reviewing your business plan, legal requirements, marketing, and licenses needed for your business.

How do I get a business license?

Licensing is handled through the state or local government. Consult our CEDR website at for a listing and links to Clatsop County, each City, or the state of Oregon for an office that will assist you with a license or permit. The best first step is to go to this website:

What type of collateral do I need for a loan?

Repayment ability from the cash flow of the business is a primary consideration in the loan decision process but good character, management capability, collateral, and owner’s equity contribution are also important considerations. All owners of 20 percent or more of the business are required to personally guarantee loans the great majority of the time.

Is entrepreneurship for you?

In business, there are no guarantees. There is simply no way to eliminate all the risks associated with starting a small business — but you can improve your chances of success with good planning, preparation, and insight. Start by evaluating your strengths and weaknesses as a potential owner and manager of a small business. Carefully consider each of the following questions:

• Are you a self-starter? It will be entirely up to you to develop projects, organize your time, and follow through on details.

• How well do you get along with different personalities? Business owners need to develop working relationships with a variety of people including customers, vendors, staff, bankers, and professionals such as lawyers, accountants, or consultants. Can you deal with a demanding client, an unreliable vendor, or a cranky receptionist if your business interests demand it?

• How good are you at making decisions? Small business owners are required to make decisions constantly — often quickly, independently, and under pressure

• Do you have the physical and emotional stamina to run a business? Business ownership can be exciting, but it’s also a lot of work. Can you face six or seven 12-hour workdays every week?

• How well do you plan and organize? Research indicates that poor planning is responsible for most business failures. Good organization of financials, inventory, schedules, and production can help you avoid many pitfalls.

• Is your drive strong enough? Running a business can wear you down emotionally. Some business owners burn out quickly from having to carry all the responsibility for the success of their business on their own shoulders. Strong motivation will help you survive slowdowns and periods of burnout.

• How will the business affect your family? The first few years of business startup can be hard on family life. It’s important for family members to know what to expect and for you to be able to trust that they will support you during this time. There also may be financial difficulties until the business becomes profitable, which could take months or years. You may have to adjust to a lower standard of living or put family assets at risk in the short-term.

Why small businesses fail

Success in business is never automatic. It isn’t strictly based on luck — although a little never hurts. It depends primarily on the owner’s foresight and organization. Even then, of course, there are no guarantees.

Starting a small business is always risky, and the chance of success is slim. According to the SBA, roughly 50 percent of small businesses fail within the first five years.

In his book “Small Business Management,” Michael Ames gives the following reasons for small business failure:

• Lack of experience

• Insufficient capital (money)

• Poor location

• Poor inventory management

• Over-investment in fixed assets

• Poor credit arrangements

• Personal use of business funds

• Unexpected growth

These figures aren’t meant to scare you, but to prepare you for the rocky path ahead. Underestimating the difficulty of starting a business is one of the biggest obstacles entrepreneurs face. However, success can be yours if you are patient, willing to work hard, and take all the necessary steps.

On the upside

It’s true that there are many reasons not to start your own business. But for the right person, the advantages of business ownership far outweigh the risks. Running a business provides endless challenge and opportunities for learning. • You will be your own boss.

• Hard work and long hours directly benefit you, rather than increasing profits for someone else.

• Earning and growth potential are far greater.

• A new venture is as exciting as it is risky.

We have found a very helpful website is or the “Business Xpress” website, which answers many questions and directs you to resources to assist your start-up business needs.

And remember our CCC SBDC provides FREE and CONFIDENTIAL Advising for start-up businesses, and businesses looking to grow, reinvent themselves, succession planning, exiting a business, and much more.

Contact us at 503-338-2402 or email to set up an appointment, or answer any questions. We are here to serve the regional business community!


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