From Concept to Commerce: A Guide on Forming Your B2B Business

Some entrepreneurs are passionate about working with a broad consumer base. Others prefer to work more directly with other businesses. Business-to-business (B2B) entrepreneurship can certainly be a promising field, but before you start raking in profits, there are a few steps required to establish your company.

Understand Your Market

If you have an idea for your B2B business, you’ll first want to verify that it’s actually viable. Specifically, ensure that:

• There’s an audience for your product or service.
• You can identify the specific goals or pain points your product is addressing.
• Your industry isn’t too competitive or crowded. 

Market research can begin with simple activities like online searches, but it may also be helpful to consider search engine trends, create email surveys, or conduct focus groups. Working with a market research company, while expensive, can provide the confirmation you need to start your business on the right foot.

Define Your Business Model

Depending on the kind of product or service you’re offering, you might choose between any number of business models. Some examples include:

• Selling goods or services.
• Renting equipment.
• Subscription-based pricing models.
• SaaS (software as a service) models. 

Choose the model that best suits your skillset, but also the model that will help you generate the kind of cash flow you need to keep up with overhead and inventory.

Register Your Business

It’s imperative for B2B businesses to convey a sense of professionalism and credibility. One of the best ways to do so is to register your company as a Limited Liability Company, or LLC. Not just anyone can form an LLC, and doing so helps demonstrate that you’re serious about your business. This, in turn, helps you cultivate trust among B2B clients.

What’s involved with registering your business as an LLC? The rules vary a little from state to state, which means the requirements to form an LLC in Texas may be a little different from the requirements in Wyoming, Nevada, or Delaware. With that said, the steps for forming an LLC usually look something like this:

• Choose a name for your company. It’s imperative to give your LLC a name that isn’t already in use by another LLC in your state. In most states, you’ll have access to a searchable database to confirm that the name you desire is still available.
• Name a Registered Agent. This may be an individual or an organization tasked with receiving tax documents, as well as legal correspondence, on your behalf. It’s typical for LLCs to pay for a third-party service, which can be less than $100 a year.
• Create an Operating Agreement. Your Operating Agreement functions as a kind of charter for your LLC, dictating how you’ll split profits and share duties with any partners you bring on board. It can help you avoid legal conflict later on.
• File your paperwork. You’ll also need to file Articles of Organization with your state. When you do so, you’ll also need to pay the registration fee. Depending on your state, this may be anywhere from $15 to $300.
• Claim an EIN. You can get an Employer Identification Number from the IRS website. This number will be necessary before you can administer payroll or file taxes.
• Set up a bank account. One of the primary reasons to choose the LLC format is that it allows you to separate your business and personal finances. As such, having a devoted business bank account is crucial. 

The bottom line: Registering your B2B company as an LLC will not only establish your bona fides, but it can also provide personal wealth protection, tax flexibility, and more. It’s worth the effort and the expense to register as an LLC.

Create Marketing Collateral

As you consider ways to market and sell your new B2B company, you’ll need to be clear about your messaging. Two documents can be helpful here: A brand guide and a buyer persona. 

• Your brand guide is a summary of what your business does, and how it makes life better for your clients. It may encompass an elevator pitch, a mission statement, and a list of distinctives that set you apart from the competition. You can also include a list of values or keywords that you’d like to associate with your company.
• Buyer personas summarize the decision-makers who will be buying from you. What are their roles? What needs do they have, or what pain points do they need to address? 

Buyer personas can help you to convey exactly how your products and services can add value to your clientele, which is essential for effective marketing and branding.

Create a Marketing Infrastructure

You won’t have the resources to position your company on every platform or social network; instead, you’ll need to make some strategic decisions about where you’ll see the most value. Some specific recommendations include: 

• SEO and website performance, including fast loading times and mobile-first design.
• Social media (for B2B, LinkedIn, and Facebook are often the best bets).
• Email marketing (essential for nurturing leads).
• Content marketing (including videos or blogs to support or explain your product and service offerings).

Manage Your Finances

Financial stewardship is critical to ongoing business success. You’ll need to make an operating budget that provides a realistic estimate of your initial profits. Seeking financing may also be advantageous. This is where the credibility of the LLC structure can be especially valuable. Also be sure you have good automated invoice software, which is essential for getting paid promptly and for maintaining a healthy cash flow.

Create a Foundation for B2B Success

B2B space is rich with opportunity. To take advantage of that opportunity, it’s imperative to establish the right foundation. From legal structure to marketing strategy, these formative components will position you to make a lasting impact.