Starting a Business in Canada

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No nonsense information on small business.

Jun 23, 2011 - 2 minute read - Comments - business news

FuEL Awards Promote Entrepreneurship In Canada

The FuEL Awards are sponsored by Rogers, TD Bank, KPMG, File Mobile, Profit Magazine and Impact. They are looking for Canada’s future entrepreneurs. They will select 20 applicants who they deem Canada’s Future Entrepreneurial Leaders. These 20 applicants will:

  • win a national award

  • be featured on the FuEL website and in the December 2011 issue of profit magazine

  • receive a one day consultation with KPMG

  • be given a chance to be FUEL Entrepreneur Of The Year and attend QuantumShift at the Ivey School of Business

To be eligible, applicants must:

  • be resident in Canada and born in or after 1982

  • be headquartered in Canada

  • have significant operations in Canada

  • be Canadian owned

  • operate independently (no subsidiaries or divisions)

The judging panel will be made up of members from the Impact Entrepreneurship Group. The evaluation will be scored based on the following criteria:

  • product or service innovation: 25%

  • community building/social responsibility: 15%

  • job creation/employment practices: 15%

  • commercial results/potential: 25%

  • total votes: 20%

The public will be able to vote on the FuEL Website until August 7, 2011. Entrepreneurs can either apply or be nominated. The application deadline is July 15, 2011. Winners will be announced November 14, 2011. While the prizes are not a lucrative as some of the other business contests that are going on this summer, if you fit the criteria, it is probably a good idea to apply. The publicity from being shortlisted or winning Entrepreneur Of The Year could help your company to the next level of success.

Jun 22, 2011 - 3 minute read - Comments - entrepreneurship

How To Start A Business In Saskatchewan

It’s an excellent time to start a business in Saskatchewan. Whether you are in Saskatoon or Regina, Prince Albert or Yorkton, Maple Creek or Tisdale, the prospects for starting a successful business are as good as any time in recent memory. Starting a business can be a daunting task. Like all big projects, things are more manageable if you break them down to a series of smaller tasks. This blog post will attempt to do that for you.

  1. Think about whether you are ready to be an entrepreneur. Talk to your immediate family members to make sure you have their support. You don’t want to enter into a new business with along a reluctant spouse.
  2. Evaluate your business idea. Does it require a new business model or are other businesses currently operating successfully using this model?
  3. If you have a new business model conduct a feasibility study to confirm your idea is sound.
  4. If your business is operating under a proven business model, conduct preliminary research to make sure that the business makes sense given your skills and finances. Make sure it makes sense for the market.
  5. If the your initial research or your feasibility study shows that your business idea has a reasonable chance of succeeding, continue to the next step, otherwise, go back to the idea stage.
  6. Pick a name for your business.
  7. Consult your lawyer and accountant and decide on a legal structure for your business.
  8. Register your sole proprietorship, partnership or corporation.
  9. Register the domain address for your website.
  10. Write a business plan.
  11. Register for a Business Account Number.
  12. Pick a bank and open an account.
  13. Apply for financing, if necessary.
  14. Apply for a business license and any other license you need to operate your business. The Saskatchewan Government has a all encompassing website for this called BizPal It will take care of your provincial and municipal licensing needs. The site will ask you questions about your business and then suggest a list of licenses and permits to apply for.
  15. Start implementing your business plan. Depending on your circumstances, this could mean signing property leases, buying and installing equipment and generally getting your business ready to open to the public.

The process of opening your business might differ slightly from these steps, but the list includes the basic tasks that most businesses will need to complete. As you can see, when a large project such as starting a business is broken down into smaller tasks, things become more manageable. If you feel like you need more information on parts of the process or if you would like us to cover additional tasks not on this list, please leave a comment below.

Jun 21, 2011 - 3 minute read - Comments - entrepreneurship

I Have A Business Idea, Now What?

Through working with prospective small business entrepreneurs, I find that many of them don’t know what the next step is after coming up with their idea for a business. I hear many questions about how much it will cost to start this or that type of business. Unfortunately, there is no easy standard answer to a question like this. Someone who has opened a similar type of business in your area might be able to give you an indication but the costs of everything have likely changed with time. At this point, it is up to the small business entrepreneur to do some research and come up with the answers. If your business model has been proven, then the research is fairly straight forward. If you have a new business model that has not been proven before, you should start taking the preliminary steps towards a feasibility study. For those of you with a proven business model:

  • Think about possible locations for your business. This will vary depending on your business type. Some businesses can be operated out of your house, others will need a commercial location.

  • Start getting a rough idea of the cost to start the business. Talk to real estate agents and property management firms about lease rates. Talk to equipment vendors to get an idea of what the necessary equipment will cost.

  • Inquire about what licenses and approvals will be needed to start the business. Find out about the time to obtain these and the cost of getting them.

  • Have a preliminary look at your competitors. How difficult will it be for you to enter the marketplace and compete? Generally speaking, the more competitive a marketplace is, the more cash it will take to compete effectively.

  • Make an assessment of the demand for your product or service. Are there enough people who are willing to pay an amount that will provide a good return on your investment?

The data discussed above will be in very rough form but this lack of precision will allow you to collect it quickly. Now it’s decision time. Based on what you’ve learned during this initial investigation, does the idea warrant moving forward? If it does, you would start to create a detailed business plan to demonstrate how the business idea will be implemented and how the business will operate. This preliminary investigation isn’t something you should pay someone to do. You need to get an idea, for yourself, of what it is going to take to start a business based on your idea and what it will be like to run it. If this seems like too much work, you should probably abandon the idea of starting a business outright. What I’ve described above are just the initial steps, the real hard work is yet to come.

Jun 20, 2011 - 3 minute read - Comments - buying a business

Buying A Franchise

Franchises are attractive to the first time business owner. They are sort of like one of those home theatres in a box. The business owner doesn’t have to pick individual components and make sure they work together. The franchisor has already determined all of that. Theoretically, the franchisee has to take the training, follow the instructions and the business should operate successfully. Unfortunately, not all franchises are created equally. The level of support from the franchisor can vary dramatically from one franchise to the next. Franchises should be investigated with a level of due diligence that compares to that done for the purchase of an existing private business. You are going to be investing a lot of time and money into this franchise so make sure you have your eyes wide open going in. I recommend investigating the following:

  1. The strength of the brand. Is the brand so strong it will automatically drive sales? Is it just a regional brand that has no customer awareness in your area? The answers to these questions will have a big impact on the value of the franchise and the effort you will have to expend to build business.

  2. How strong is the management system? Is the system really strong in that all franchised outlets are run identically with a consistent customer experience or is there wide variation between locations? How well run is the franchisor’s head office?

  3. What is the return on your investment? Will you get a sufficient return for the risk you are taking? There is no point getting involved in a franchise to basically buy a job for yourself. You could take a job somewhere and get paid the same amount with no investment at risk.

  4. Look at the overall industry and identify any trends that could affect you. Are there competitors that are starting to rise up to provide a real challenge? Talk to franchisees and get revenue and cost data from them. Don’t rely on proforma financials from the franchisor.

  5. Talk to your banker. If the bank has a formal franchise package for your particular franchise that is a very good sign. It means that the franchisor has a relationship with the bank and there might be buy-back agreements or other agreements between the two parties that will make your loan application process much easier.

I’ve saved the most important point for last. Make sure you have a passion for the business. If the business doesn’t interest you, it doesn’t matter whether it’s a franchise or a private business, you won’t have the drive to succeed during the tough times.

Jun 15, 2011 - 2 minute read - Comments - advertising business news entrepreneurship marketing

The Number One Thing You Need to Know for Your Business!

The biggest lesson I’ve learnt from business is that no matter how good your product or service is, if people don’t know about it, then you’re in big trouble. You could have the best product in the world but you’ll only find success if enough people know about it to buy it. Marketing is king and if you can’t advertise effectively, then be prepared to fail.

So how do you get people to know you and your business? Shouldn’t be too hard right? But ask any business owner and they’ll tell you that advertising effectively is one of the hardest things to do. So where do you begin? Well, here are a few key tips to start you off. (1) Define your target market and break your ideal consumers down into different segments. This allows you to create custom marketing messages for different customer segments. (2) Once you know who you’re targeting and what message you want to send, research different advertising methods. Find the best ways to reach these consumers and discuss the pros and cons of each method. (3) Don’t be afraid to spend money on advertising. Free forms of marketing such as blogging and setting up Facebook and Twitter accounts are fine and can play an important role in your entire marketing strategy, but you also need to advertise in the “real world.”

Put time and effort into building a solid marketing plan and focus on generating awareness for your company. I recommend reading Duct Tape Marketing by John Jantsch. It gives you practical advice on how to reach your ideal consumers and discover what works for your business. Remember, if they don’t know you, they can’t buy from you.

Jun 14, 2011 - 3 minute read - Comments - entrepreneurship

The Different Types of Entrepreneurs

The term “entrepreneur” gets thrown around a lot these days. I think it’s important to clarify what the term means. Merriam-Webster defines “entrepreneur” as:

one who organizes, manages, and assumes the risks of a business or enterprise

The dictionary definition is helpful but I think the types of entrepreneurs as defined by entrepreneur and Stanford professor Steve Blank are much more useful for practical purposes.

  1. Small Business Entrepreneur
  2. Scalable Startup Entrepreneur
  3. Large Company Entrepreneur
  4. Social Entrepreneur

The Small Business Entrepreneur is looking to start a business that will provide for a comfortable living for his or her family. The business is funded from personal savings, loans from friends or family and bank loans. This business, if successful, will experience steady growth over a long period of time. This type of business can grow quite large but the majority don’t. The business transitions from a startup to a small business. This is the category that 95% of people who are starting a business fall into.

The Scaleable Startup Entrepreneur is trying to launch the next Google or Amgen. The business is funded by investments from angel investors, venture capitalists, private equity and potentually, public markets. The business, if successful, will experience a period of exponential growth before becoming a mature company. Successful companies of this type grow to Fortune 500 scale. This type of business goes from a scaleable startup trying to establish a business model, to a transitional business focused on growth, to a mature business with stable cash flows and profits.  Only about 5% or fewer of entrepreneurs are trying to start this kind of business.

The Large Company Entrepreneur takes a team from a large company and starts a new division of the company, focused around a new product. This is usually done because the parent company is too bound by bureaucracy and culture to innovate under its existing structure. Funding comes from the parent company and the goal is to grow the new product into a large business. This happens quite rarely.

The Social Entrepreneur is looking for a new an innovative way to solve a societal problem. Funding comes from governments and donations. Profits aren’t the main motive, but the entrepreneur is focused on achieving results and using capital as efficiently as possible. Goals are set and outcomes are measured in an effort to continually improve performance.

So, what’s the point of all this? Don’t get distracted by the issues of other types of businesses. The strategy and execution needed to be a successful Small Business Entrepreneur are different than that of a Scalable Startup Entrepreneur. Much of what is written in blogs and websites is addressed towards the Scalable Startup Entrepreneur. It’s big money, high growth and it pulls in readers.

If you are starting a small business, much of this isn’t appropriate for what you are doing. For example, venture capital is not in the cards for you and it makes no sense to spend time worrying about it. Learn from blogs and other entrepreneurs in your space and focus on building your business.