From The California Business Journal Newswire.
According to the Business Wire, the Telecom market has seen a CAGR (Compound Annual Growth Rate) of 4.4% since 2014 and looks to continue to 6.4% by 2022. This puts the market at a value of 3,453.2 billion dollars.
There is no sign of the telecom world slowing down. With constant innovation occurring and the need for the technology at its highest, the world demands it and the market answers.
With proper information and a clear, detailed plan, a strong and successful telecommunication business can be founded.
1. The Umbrella of “Telecommunication Business”
Not unlike the business plan of any other, you need to define the type of telecommunication business you want to start. It’s even more important here as it will change some of the permits you need to file.
At one time there was only a single definition to the term telecommunication. It was the landline. With the development of the internet, even the use of landline communication has changed.
From a single item definition telecom has branched out immensely to include:
- Data providers
- Cellular networks
- Traditional phone networks
- Home security
- Television networks
The majority market share as of 2018 is held by wired telecommunication carriers at 45.2%. Although in the coming years, with the growth of new technology, it is very likely that there will be a strong shift in the market.
With such a wide range of markets existing under the larger term of telecommunications, it is extremely important that you define your primary focus as well as short and long term goals.
2. Understand the Benefits to Businesses
Efficient communication is key for any business, both for the workers as well as the customers. Telecom businesses allow for this to happen. There are a few particular benefits they offer, including:
- Improved Communication: A telecom business offers many options for information exchange. By having wired and wireless technology as well as multiple options for each, there is never a chance of not being connected.
- Tools for Team Collaboration: Telecom allows teams to connect and create. They will have access and technology to communicate across function and make progress no matter the department
- Increased Flexibility: Global Workplace Analytics reports that in the last five years work from home has grown by 115%. Telecom developments have allowed for this. Employees can work remotely from home or more easily travel and work with collaborative companies
- Strengthening Customer Service: Having a constant connection and being reachable 24/7 puts the customer at ease. It will build the brand and boost the reputation of the business.
3. Create a Business Plan
With the focus of the business in place is it important to next flesh out your plan. This will be necessary to obtain permits and the funding needed to move forward in starting the company.
There is a collection of points that the plan should address. This is to provide a clear idea concerning all aspects of the company, the management style, projections for the future, and answer any potential questions the reader may have.
The plan is as follows:
- Executive Summary: This is a quick, short paragraph that is a summary of the entire plan. It would be akin to a pitch given in a short meeting, a few minutes or so.
- Market Analysis: The current state of the market that the company exists in. How would this company fit in that market and how would it take hold in the market.
- Products and Services: A description of the services being offered. The products being sold. What does the company offer, how can it provide things differently?
- Competitive Analysis: What other companies exist in the marketplace that is offering similar services or products. Offer a picture of their financial situation. How can you provide a better experience than what they are offering?
- Business Strategy: What management style are you planning? Who is going to be running each of the positions and what are their qualifications?
- Risk Management: The forecasting and evaluation of financial risks together with the identification of procedures to avoid or minimize their impact
- Financial Projection: Profit projection for the next five years.
This detailed plan must be created before moving forward in any manner. It will additionally allow for the staff involved to determine a final focus on the goals of the company.
4. Obtain Permits
While there are government fees on a federal level, it is important to follow up on a state level as well as there are different regulations in each state.
For all the proper forms and reference information, you can reference the FCC online portal. You are able to file any needed permit information online or print out the needed forms and file them via physical mail.
When the proper forms are filled with the FCC you must next move on to forms with the IRS. They will be able to provide the EIN or Employer Identification Number, this can be done using the SS-4 form. This is needed primarily for tax purposes.
5. Address Financial Concerns
No matter the business, it always comes down to the numbers. While the telecom market is very lucrative, the initial investment can be very large. Read more here to learn about how you can secure a loan for your new business.
The amount of funding needed will differ with both the type of business and the type of permits filed. There are multiple fees that will be owed to the FCC and some may or may not apply to your business. You should also expect to pay:
- Processing fees and equipment approval
- Regulatory Fees (Annual Fee)
- FOIA – Freedom Information Act. This is an “as needed” filing
- Forfeitures and Penalties
It’s Time to Start a Telecommunication Business
The market is growing and there is no sign of it stopping. 2020 is poised for immense growth, so investing in the time and effort to starting a business now could put you in a position of financial gain in the future.
Telecommunications have very specific detailed requirements and regulations and a large amount of needed investment. The resources are available for those looking to start a telecommunication business and make those investments and effort.
Want more expert advice? Check the blog for more information.