Starting any business is like an everlasting pain in the head until and unless the company makes some profit. But in today’s time when the entire world is being driven by technology, starting an IT business can be a boon to the ever-increasing demand for innovations and technology along with a large yield of profit in a short period compared to other companies.
Regardless of the field, you belong to, you can start an IT business with the right expertise and knowledge and an excellent business model can lead you a long way. One can begin an IT services business to capitalize on the need of different IT fields of different businesses.
One thing that must be kept in mind is that the main selling point of your business should be client satisfaction and the business marketing strategy. Starting an IT business demands you to be on your toes with the everchanging pace of technology.
What are some of the steps involved in setting up an IT company?
Deciding the main services of your company
If you have decided to open an IT company then the next step must be to decide the type of IT company you wish to open, as several services can be offered like cybersecurity, cloud computing, business intelligence and analytics, data recovery, application development, data center management, and web designing, etc. Depending upon the type of service you wish to offer an IT company can be of two types;
- Specialized IT company – offers a single or specific service or we can say that this type of company specializes in a specific service.
- General IT company – offers a large number of services.
Choose a good company name
A company name must be self-explanatory meaning it must be clear and must thoroughly explain your business idea. The name must be precise and attractive.
Forming a good IT business team
Though the service and technology offered by your company will be the highlight of your company for any business a good team is the most critical asset of your company. A company that has the best team will ensure that your company will do the right work at the right time before the deadline. For your company to work efficiently the employees of your company must have the right expertise so that your company can do a great job servicing the clients.
Having a partner can have pros and cons both. But if you are looking for more funds to raise your capital then you can look for a good partner which can help you not only with the funding but with the decision-making as well. For example, a good banking partner can help you manage the cash flow, get a business loan, and can even help you plan for financial growth and success.
As an owner of a new company, it is important to make sure that your finances are in the right hand and your finances are being maintained right from the start so that your business does not end up in a cash flow crunch.
Choosing a right business structure
Since you are going to make your company official than having all the legalities done must be your priority and this starts with choosing the right business structure for your company as changing the structure at a later stage can be problematic.
There are four types of business structures:-
This type of business structure is perfect if you plan to work individually or with a close relative or it can be your spouse as well. This type of business structure is ideal for a small IT start-up company and when you have low capital as this business structure is inexpensive and simple.
You may even have fewer taxes to pay but you will be responsible for any debt incurred during the process of setting up your company or when dealing with the customers so you must make choices wisely.
In this type of business structure, you are liable to share your profit, losses, and responsibilities with your partner. You and your partner will be responsible for everything that occurs within the company which means that you will be liable for half of the debts and assets with your partner and you cannot outlook the needs of your partner as you are within the legal agreement with your partner. The partners will be liable to pay their share of income taxes.
This type of business structure is best if you plan to make your business public at some point of time in the future. Corporations are the most complicated kind of business structure as they require proper legal paperwork before setting up a company. In this, the partners are also the shareholders and are protected from personal liability if the company goes bankrupt. A corporation is an entity of its own.
Obtain necessary licenses and certification
Your company must possess the right certificates and licenses whichever are required for the legal establishment of the company. The type of certificates can differ according to the type of IT company it is for example if it is a general IT company then you must require multiple certificates of different specialties.
But if it is a specialized IT company then you must require a single certificate of specialty. These certificates are important to attract a large number of clients and make a good profit.
Having a proper system is a must if you want your company o work smoothly without any problems, so you must develop a system right from the beginning for example you can use accounting software to record all your expenses and sales and keep track of your business, an employee time tracking software to ensure that all the billable working hours of the employees are being recorded and the employees are being paid for the extra hours without any confusion.
This will not only help in maintaining peace in the company but also the business stay profitable.
Storage of Client Data
Having client satisfaction is necessary and this client’s data must be kept safe and confidential. There must be a proper digital location to store data and proprietary information.
For any business, having a good marketing strategy is a must, whatever the method you choose for marketing whether it is the traditional way of making contacts with people belonging to the same field or if it is the modern way like digital marketing you must have a proper marketing strategy.
Above are only a few necessary steps that must be taken for setting up an IT company but one thing should be clear those are not the only necessary ones. Whatever you plan to provide the service you must stick to the service you have a specialty in and later on, you can expand the company’s skill set by offering other services as well. An IT company must always be vigilant and keep pace with new trends if you plan to be in the market for a long time. you must keep a track of your competitors in the market and their marketing strategies.