The world’s corporate giants were not born overnight. Somebody had an idea, developed a plan, collected funds, and started a business. Dedication, uniqueness, and excellent service nurtured it.
Quality and branding preserve it. A read into the history of any significant corporation consistently enforces this precept. The same mandate holds good for India’s industrial giants.
Make In India
‘Make In India,’ a pioneering program in the history of the world’s largest democracy, was flagged off on 25/09/2014 by PM Narendra Modi.
The ‘Make In India’ initiative is three-pronged.
It motivates manufacturers and service providers in India to upscale quality to meet and exceed global standards. ‘Make In India’ also inspires entrepreneurship among Indians through incentives and offerings for establishing micro, small and medium ventures.
How To Start A Business In India In 2023?
Here is the 12 step plan to start any small business idea in India. After reading this, I am sure you will make a solid blueprint and start your small-scale business from home.
1. Decide on a Business Idea
For MSME, India has opened doors to many sectors for small businesses, including aerospace and defense. There are many opportunities in hospitality, tourism, manufacturing industries, and agriculture under ‘Make In India.’
Indian citizens, Non-Resident Indians can launch any small businesses, Overseas Citizens of India/Persons of Indian Origin, and foreign nationals in partnership with locals.
India’s Foreign Exchange governs investments by foreign companies and nationals, and Monetary Act (FEMA) is subject to Reserve Bank of India regulations.
2. Get More Training, Experience
You must start your business according to your expertise. Remember, your skills and experience will decide the success of your business. Try to learn as many trade tricks as possible and implement them in your business.
You may opt for a specialized or vocational training course offered by various famous institutes of the Indian government. You can also get additional skills by working with other established organizations in the field. It is always best to start as a beginner, forgetting all past knowledge and experience.
It will help you to learn more with fresher perspectives. Certain banks and licensing authorities might also require technical education certifications to validate your business.
3. Writing It Down: The Project Report
Uniqueness decides the success of any business. It would help if you studied domestic and international markets for products and services compatible with yours. Find all the detail related to your business. Read more and more stories on the success and failure of similar businesses.
The 1st step to any business begins with feasibility studies and a project report. This can be achieved with the help of experts, based on the nature of business and funds.
A project report must contain details, including the owner or partners' names, ages, and qualifications. Attach experience certificates relevant to the trade. This helps in getting the finance.
Include a revenue model with more specific details, including cost and sale price, delivery charges, taxes, and other expenses. Project expected revenues for the next 2-3 years.
4. Finalize Your Source of Funds
Most small businesses in India are self-funded or launched by collecting funds from family and friends. You will require a fair estimate of how much money you will require to launch your startup.
Also, calculate the finances you will need to keep the business afloat till it becomes profitable. Entrepreneurs launching micro, small and medium enterprises can seek funding from various places explained below.
Banks: You need to check with various nationalized or private banks for startup capital offers.
Cooperative credit societies: Most credit societies offer loans for small businesses and home businesses if you purchase their shares.
Community development funds: Focused on the welfare of specific communities, they offer finance for small businesses.
Crowdfunding: Attracting investment from friends, neighbors, the community, or the general public in exchange for company stock.
Venture capitalists/ angel investors: These have exploded in India over the last five years and offer great funding opportunities for small businesses, startups, and home businesses.
Lending rates and other details are prone to vary depending on the type of venture, projected ROI, risk factors, and others.
5. Decide on Your Location
If you are starting a business in India, you need space at home, a shop, a stall, a workshop, or an office. Registering your small business with the local municipality/ village administration is mandatory under Indian laws.
The civic body or gram panchayat will permit your small/home business from the area under its jurisdiction. Utility providers ask for municipal/ village panchayat registration before giving electricity and water connections to the premises.
Your location serves as proof of the physical address of your business. Taxes levied on businesses in rural areas are lower.
6. Business Registration and Legalization
This is a messy, daunting job for every business person. Registering your business in India can be lengthy and complicated. Thanks to direct instructions from PM Narendra Modi, the Ministry of Corporate Affairs (MCA) now registers new companies within one or two working days.
Almost all formalities for registering a business can be completed on the internet. Details about the documentation required and other FAQs are listed on the MCA website. Licenses from various state and central govt are mandatory when launching a small business or startup.
7. Get Yourself Tax Registered
Starting a small business at home entails procuring a Permanent Account Number (PAN) and Taxpayers Identification Number (TIN). Getting a PAN and TIN is relatively easy.
You can approach any PAN and TIN service center authorized by NSDL (National Securities Depository Ltd), submit completed forms by attaching the required documents, and pay a nominal fee. PAN and TIN numbers are allotted within 30 working days from the date of application.
PAN and TIN are helpful when paying taxes to the government year after year.
8. Launch Your Own Website
Based on their nature, all small businesses in India can be categorized in three types:
- Online (it can be a home business or set up an office)
- Online and physical
- Physical (store/ office/ workshop/home)
Trends demand every business to maintain an online presence. This can be done by creating a website or social media pages like Facebook Page, or Instagram page, depending on budget and product/ services offered.
Creating an E-commerce store is ideal since they allow direct ordering and multiple payment choices. Today especially after covid-19, requires an online presence even for purely physical businesses to match rivals and reach a wider clientele. Getting a website for your business is very affordable.
9. Grab a Market Position
Use all your creativity while launching a startup or small business. Give your startup a great, easy-to-remember name. Company logos are brand ambassadors for your business. Hire a professional logo designer from Fiverr or Upwork to create a unique logo for your business.
This logo will someday herald your superior products and services worldwide. All successful businesses retain the logo or the version they used at launch.
Print official stationery depicting the logo, brand, company name, and contact details. This includes letterheads, envelopes, invoice books, payment vouchers, and other documents required for official transactions.
10. More Money Matters with Banks
Armed with the company, municipal registration, and PAN number, the bank of your choice will open a current account. Before rushing to open a current bank account, check a few details. Ask your banker about overdraft facilities.
This is important to ensure your cheques will never bounce due to scarce funds. A bounced cheque indicates the financial instability of a company or business. You can negotiate how many free cheques you are entitled to annually with the bank.
Check for loans and other facilities given to a small business person like you, such as instant credit on deposited and outstation cheques. Check for a Letter of Credit facility if your business needs imported raw materials.
11. Getting Staffed with Low Wages
This is one prime area of your small business. Usually, most entrepreneurs launch a proverbial one-man show. Some enlist the assistance of family members, including spouses, grown-up kids, siblings, or parents.
This may not always be possible. The best way to get qualified staff at beginner salaries is through educational institutes or websites. Almost every training center provides job placement assurance. Websites like Internshala allow you to hire interns for a low salary.
You can register your company with job websites like Indeed and Naukri to get fresh graduates on a stipend basis. This upgrades your skills while creating staff for your own small business.
12. Publicize Your Small Business
Intense competition demands you publicize your small business well. Advertising can cost a fortune and eat heavily into your capital. Using micro-blogging sites such as Twitter to introduce your company combined with a good presence on Facebook serves this purpose.
You can also create a YouTube channel, launch videos of your company, products and services, salient features, and other information on your channel, and upload relevant pictures on Instagram.
A great LinkedIn account for your business will ensure you reach the right network.
You can also use traditional ways to promote your business, like advertising in newspapers, local radio, distributing pamphlets, etc.
Ministry of Micro, Small, and Medium Industries
India’s MSME Ministry is tasked with developing small businesses & startups, and online businesses. MSME has offices in major cities of each of the Indian states and seven Union Territories. The ministry regulates licensing, rules, and regulations for MSMEs.
It creates and launches various schemes and programs for entrepreneurial development. Schemes like offering funds on soft terms to prospective entrepreneurs are floated regularly by this ministry.
Details about ongoing funding schemes, investment opportunities in various Indian states, training programs and rules, and regulations currently in force can be had from the Ministry of MSME.
On April 8, 2015, Prime Minister Narendra Modi flagged Pradhan Mantri Mudra Yojana and Micro Units Development and Refinance Agency Bank. Getting finance for start-ups and existing small businesses is more accessible from Mudra Bank.
Street vendors are also eligible for credit under Mudra Bank. Business finance under Mudra Bank schemes can be availed from any Public Sector Bank, cooperative banks, and authorized financial institutions.
A Good Start Translates to Healthy Returns
Having all licenses and permits, proper bank accounts, and agreements with suppliers before launch ensures a great start for your small business at home or online. Recent policies for investors have cut and eliminated red tape to a great extent.
Yet bureaucrats accustomed to unhealthy practices tend to pick faults. Reading news related to your business daily. This helps to stay abreast with developments and any new regulations that may come into force.
Are you starting your business from home, office, or online? All the best to start your small business in India and for your startup.