7 Phases of Business Start-Up Every business goes through phases, including yours. Here's how to sail through each phase and grow your business.

(YoungBiz.com) - You've probably heard this sayingbefore, most likely from your parents: If you fail to plan, youplan to fail.

Any success in life--from planning a party to starting abusiness--takes some planning. And while every start-up isdifferent, by going through these seven phases of development,you'll be well on your way to building a business with a solidfoundation.

Phase 1:Decide whatyou're good at. The greatest determinant of your success,of course, is you. That's why it's so important that youchoose a business that's right for you, based on what you liketo do and what you're good at.

To get the juices flowing on ideas, make a list of your hobbies,talents and work experience--any jobs or chores you know how to do.These are your personal business assets or skills.

There are basically two ways to earn money: 1) sell goods(merchandise), or 2) sell service (labor and knowledge). Now studyyour list of personal assets, and write down some ideas for goodsor services that you could create and sell. You should be able tolist at least 10 or more.

Phase 2:Choose anidea. Successful entrepreneurs not only choose businessesthey'll like; they also capitalize on products or services thatpeople need. (Hint: Think about jobs people don't like or havetime to do.)

Go over the list you made in Phase 1. Which of the products orservices you listed would draw the most customers? If you'renot sure, consider conducting a survey in your community. It'simportant to strike a balance between your personal interests andwhat your customers need or want. After all, you want your businessto be successful and fun.

Phase 3:Prepare forstart-up. One of the most important things to do during thisplanning phase is to determine your start-up costs. Make a list ofall the equipment, supplies and furnishings you will need tooperate the company. Don't forget operating expenses such asyour phone service, voice mail or pager, rent and transportationcosts. If you're selling merchandise, you'll also have tomake decisions about how much inventory to buy.

Once you know all the start-up expenses, you can start figuringout where to get the money to open the doors. Will you use yourpersonal savings? Do odd jobs to earn the money? Get a loan fromyour parents? This phase calls for careful planning before you canmove forward.

Phase 4:Be official.Now you're almost ready to get started. But before you open forbusiness, most states require that you take care of some legalissues, such as getting a sales tax permit and registering yourbusiness name.

Some cities or counties require special licenses or permits tooperate a business. And if you want to put up signs or hand outfliers in your neighborhood, you'll need to check with yourhomeowners' association to see if it's OK.

To avoid legal problems, go to your local city hall or Chamberof Commerce office and request information on the legal steps youmay need to take before starting your business. For moreguidelines, see "Keep ItLegal."

Phase 5:Attractcustomers. So the day has finally arrived that you're openfor business. If you're going to stay that way, you've gotto tell the world that you've arrived.

While you're certain to get a few customers throughword-of-mouth, you can't depend on that alone. There are lotsof inexpensive ways to get the word out. Design and distributefliers. Get some business cards printed. And start practicing yoursales talk.

You will also need to brainstorm a long-term marketing plan foryour company. Jot down all the different groups of people who couldbenefit from your product or service, like pet owners, elderlypeople or people with swimming pools. Then design a plan to getyour sales message to each group of potential customers.

Phase 6:Take care of themoney. You've heard stories about famous people who werevery wealthy but managed their money so poorly that they ended upbroke. It's the same with a business. Your business might bevery profitable from the get-go, but if you don't have a planfor how you will manage the money that comes in, your businessmight struggle, or even fail.

Once you are open for business, you will need to find a systemfor keeping close track of all the money your business brings in aswell as all your expenses. A good record-keeping system will helpyou know which customers owe you money, whether your business ismaking enough sales to cover expenses and when you can giveyourself a raise. Good records will also help you know whether youowe taxes and, if so, how much.

Phase 7:Keep ongrowing. All successful entrepreneurs have goals. Setting goalsallows you to measure your performance and make important decisionsabout the future of your business. The key to successfulgoal-setting is to be specific. For example:

• Put your goals in writing so you can remember, review andrevise them. This allows you to stay on track or change tracks ifsomething isn't working.
• Make your goals measurable. Instead of saying "I willincrease sales," say "I will increase sales by 20 percentin the next three months."
• Set goals that are reachable, but challenging. If you areearning $100 a week, try to double it. A larger increase might bedifficult; less than that might be too easy.
• Make deadlines for attaining your goals. This helps you chartyour growth and keep from getting bogged down.

A successful business owner is someone who not only offers anexcellent product or service, but who is also continually lookingfor ways to improve his or her business. Maybe that means lookingfor new products your business could offer or offering yourservices to a new group of customers. Be creative and stay on thelookout. You never know when that next opportunity will come yourway!