Sumvaad

Starting a micro or small business in India, whether in consumer goods or services, requires a structured approach. Whether your business operates offline, online, or both, following a clear process ensures success.

Here’s a step-by-step guide to help you build your business from scratch.

Step 1: Identifying the Problem

The foundation of a successful business is solving a real problem. Consider:

• What gap exists in the market?

• What common problems do people face?

• Can my product or service offer a better solution?

• How urgent is the problem, and will customers pay for the solution?

Step 2: Validating the Market Gap

Before investing resources, validate whether the problem is real and worth solving.

• Conduct surveys, interviews, and collect user feedback.

• Engage with potential customers through online communities or local markets.

• Analyze if competitors are struggling to solve the problem effectively.

• Assess willingness to pay: Are customers actively looking for a solution?

Step 3: Market & User Research

Understanding your audience and the market landscape is crucial.

• Define your target audience: age, income, location, needs and behavior.

• Determine market size and demand trends using tools like:

  • Google Trends – To analyze search volume for your product category.

  • Surveys & Interviews – Using Google Forms or Typeform to collect feedback.

  • Competitor Analytics – Study social media engagement, customer reviews, and website traffic using tools like SimilarWeb and Facebook Ad Library.

• Identify customer pain points and expectations.

Step 4: Competitor Research

Study existing players in your industry:

• Who are your direct and indirect competitors?

• What are their strengths and weaknesses?

• What pricing strategies do they use?

• What channels do they sell through: offline stores, e-commerce platforms, social media, etc.?

• Identify gaps where your business can stand out.

Step 5: Identifying the Right Product or Service

Choose a product or service that aligns with your research findings.

• For consumer goods: Consider demand, ease of procurement, storage requirements, and pricing.

• For services: Assess skills required, ease of delivery, and scalability.

• Ensure the business aligns with your expertise and resources.

Step 6: Understanding Procurement (For Goods) or Service Delivery

For product-based businesses:

• Identify suppliers, manufacturers, or wholesalers.

• Understand lead times, bulk discounts, logistics, and storage needs.

• Determine supplier reliability and quality consistency.

For service businesses:

• Define the service workflow from inquiry to delivery.

• Identify required resources: staff, tools, or technology.

• Optimize efficiency to improve service quality and reduce costs.

Step 7: Evaluating Product & Unit Costs

Understanding costs helps determine profitability.

• Calculate raw material costs, manufacturing, and packaging costs.

• Include operational expenses: rent, salaries, marketing, and logistics.

• Factor in hidden costs like payment gateway fees (for online businesses).

• Determine the break-even point and profitability margins.

Step 8: Pricing Strategy

Set a price that balances profitability and market competitiveness.

• Cost-based pricing: Add a markup over the cost price.

• Competitive pricing: Set prices based on competitor rates.

• Value-based pricing: Price based on customer willingness to pay.

• Psychological pricing: Use pricing techniques like ₹999 instead of ₹1,000.

Step 9: Choosing the Business Channel (Online, Offline, or Both)

Decide where and how to sell:

Step 10: Legal Compliance & Taxation

Ensure your business meets all legal and tax requirements:

• Register your business as a sole proprietorship, partnership, LLP, or Pvt Ltd.

• Obtain a GST registration if annual turnover exceeds ₹40 lakh (₹20 lakh for services).

• Get an FSSAI license for food-related businesses.

• Apply for necessary industry-specific licenses (Shop Act, MSME registration, etc.).

• Maintain proper bookkeeping and file tax returns on time.

Step 11: Go-To-Market (GTM) Strategy & Marketing

Once everything is in place, focus on launching and growing your business.

3-Month GTM Plan (example)

Month 1:

• Create branding (logo, website, social media pages).

• Run pre-launch ads on Instagram/Facebook.

• Engage with early customers and build a waitlist.

Month 2:

• Launch website or offline store.

• Run introductory offers & influencer collaborations.

• Use WhatsApp Business for direct customer engagement.

Month 3:

• Optimize online presence using SEO & content marketing.

• Gather testimonials & reviews for credibility.

• Scale marketing with ads and referral programs.

Customer Retention Strategies

• Provide excellent customer service and post-sale support.

• Offer loyalty programs and referral discounts.

• Continuously engage with customers through emails, WhatsApp, or SMS.

Conclusion

Starting a small or micro business in India requires thorough research, careful planning, and execution. Whether you choose an online, offline, or hybrid model, ensure you validate your idea, understand market dynamics, and comply with legal requirements. With the right strategy and persistence, you can build a profitable and sustainable business.

Final Business Checklist

✅ Identified a real business problem. 

✅ Conducted market & competitor research. 

✅ Selected the right business model (online/offline). 

✅ Registered business & complied with legal requirements. 

✅ Finalized pricing & procurement. 

✅ Created a marketing strategy. 

If you’re an aspiring entrepreneur, take the first step today! Let us know your thoughts, and feel free to share your questions or experiences in the comments.