How to open a seismic surveying firm?
Want to start a seismic surveying firm but don't know where to begin? Then you've come to the right place!
Our comprehensive guide covers everything related to opening a seismic surveying firm - from choosing the right concept to setting out your marketing plan and financing your business.
You'll also learn how to assess the profitability of your business idea and decide whether or not it can be viable from a financial perspective.
Ready to kickstart your entrepreneurial journey? Let's begin!
What is the business model of a seismic surveying firm?
Before thinking about starting a seismic surveying firm, you'll need to have a solid understanding of its business model (how it generates profits) and how the business operates on a daily basis.
Doing so will help you decide whether or not this is the right business idea for you, given your skillset, personal savings, and lifestyle choices.
Looking at the business model in detail will also enable you to form an initial view of the potential for growth and profitability, and to check that it matches your level of ambition.
The easiest ways to acquire insights into how a seismic surveying firm works are to:
- Speak with seismic surveying firm owners
- Undertake work experience with a successful seismic surveying firm
- Participate in a training course
Speak with seismic surveying firm owners
Talking to seasoned entrepreneurs who have also set up a seismic surveying firm will enable you to gain practical advice based on their experience and hindsight.
Learning from others' mistakes not only saves you time and money, but also enhances the likelihood of your venture becoming a financial success.
Undertake work experience with a successful seismic surveying firm
Gaining hands-on experience in a seismic surveying firm provides insights into the day-to-day operations, and challenges specific to the activity.
This firsthand knowledge is crucial for effective planning and management if you decide to start your own seismic surveying firm.
You'll also realise if the working hours suit your lifestyle. For many entrepreneurs, this can be a "make or break" situation, especially if they have children to look after.
First-hand experience will not only ensure that this is the right business opportunity for you, but will also enable you to meet valuable contacts and gain a better understanding of customer expectations and key success factors which will likely prove advantageous when launching your own seismic surveying firm.
Participate in a training course
Undertaking training within your chosen industry is another way to get a feel for how a seismic surveying firm works before deciding to pursue a new venture.
Whichever approach you go for to gain insights before starting your seismic surveying firm, make sure you familiarise yourself with:
- The expertise needed to run the business successfully (do you have the skills required?)
- How a week of running a seismic surveying firm might look like (does this fit with your personal situation?)
- The potential turnover of your seismic surveying firm and long-term growth prospects (does this match your ambition?)
- The likely course of action if you decide to sell the company or retire (it's never too early to consider your exit)
At the end of this stage, you should be able to decide whether opening a seismic surveying firm is the right business idea for you given your current personal situation (skills, desires, money, family, etc.).
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Assemble your seismic surveying firm's founding team
The next step to start your seismic surveying firm is to think about the ideal founding team, or to go in alone (which is always an option).
Setting up a business with several partners is a way of reducing the (high) risk of launching a seismic surveying firm since it allows the financial risk of the project to be shared between the co-founders.
This also allows the company to benefit from a greater diversity of profiles in the management team and to spread the burden of decision-making over several shoulders.
But, running a business with multiple co-founders brings its own challenges. Disagreements between co-founders are quite common, and these can pose risks to the business. That's why it's crucial to consider all aspects before starting your business.
To make an informed decision, we suggest asking yourself these questions:
- How many co-founders would increase the project's chances of success?
- Do you and your potential partners share the same aspirations for the project?
- What is your plan B in case of failure?
Let's examine each of these questions in detail.
How many co-founders would increase the project's chances of success?
The answer to this question will depend on a number of factors, including:
- Your savings compared with the amount of initial capital needed to launch the seismic surveying firm
- The skills you have compared with those needed to make a success of such a project
- How you want key decisions to be taken in the business (an odd number of partners or a majority partner is generally recommended to avoid deadlock)
Put simply, your partners contribute money and/or skills, and increasing the number of partners is often a good idea when one of these resources is in short supply.
Do you and your potential partners share the same aspirations for the project?
One of the key questions when selecting your potential partners will be their expectations. Do you want to create a small or large business? What are your ambitions for the next 10 or 15 years?
It's better to agree from the outset on what you want to create to avoid disagreements, and to check that you stay on the same wavelength as the project progresses to avoid frustration.
What is your plan B in case of failure?
Of course, we wish you every success, but it's wise to have a plan B when setting up a business.
How you handle the possibility of things not working out can depend a lot on the kind of relationship you have with your co-founders (like being a close friend, spouse, former colleague, etc.) and each person's individual situation.
Take, for instance, launching a business with your spouse. It may seem like a great plan, but if the business doesn't succeed, you could find yourself losing the entire household income at once, and that could be quite a nerve-wracking situation.
Similarly, starting a business partnership with a friend has its challenges. If the business doesn't work out or if tough decisions need to be made, it could strain the friendship.
It's essential to carefully evaluate your options before starting up to ensure you're well-prepared for any potential outcomes.
Is there room for another seismic surveying firm on the market?
The next step in starting a seismic surveying firm is to undertake market research. Now, let's delve into what this entails.
The objectives of market research
The goal here is straightforward: evaluate the demand for your business and determine if there's an opportunity to be seized.
One of the key points of your market analysis will be to ensure that the market is not saturated by competing offers.
The market research to open your seismic surveying firm will also help you to define a concept and market positioning likely to appeal to your target clientele.
Finally, your analysis will provide you with the data you need to assess the revenue potential of your future business.
Let's take a look at how to carry out your market research.
Evaluating key trends in the sector
Market research for a seismic surveying firm usually begins with an analysis of the sector in order to develop a solid understanding of its key players, and recent trends.
Assessing the demand
After the sector analysis comes demand analysis. Demand for a seismic surveying firm refers to customers likely to consume the products and services offered by your company or its competitors.
Looking at the demand will enable you to gain insights into the desires and needs expressed by your future customers and their observed purchasing habits.
To be relevant, your demand analysis must be targeted to the geographic area(s) served by your company.
Your demand analysis should highlight the following points:
- Who buys the type of products and services you sell?
- How many potential customers are there in the geographical area(s) targeted by your company?
- What are their needs and expectations?
- What are their purchasing habits?
- How much do they spend on average?
- What are the main customer segments and their characteristics?
- How to communicate and promote the company's offer to reach each segment?
Analyzing demand helps pinpoint customer segments your seismic surveying firm could target and determines the products or services that will meet their expectations.
Assessing the supply
Once you have a clear vision of who your potential customers are and what they want, the next step is to look at your competitors.
Amongst other things, you’ll need to ask yourself:
- What brands are competing directly/indirectly against your seismic surveying firm?
- How many competitors are there in the market?
- Where are they located in relation to your company's location?
- What will be the balance of power between you and your competitors?
- What types of services and products do they offer? At what price?
- Are they targeting the same customers as you?
- How do they promote themselves?
- Which concepts seem to appeal most to customers?
- Which competitors seem to be doing best?
The aim of your competitive analysis will be to identify who is likely to overshadow you, and to find a way to differentiate yourself (more on this see below).
Regulations
Market research is also an opportunity to look at the regulations and conditions required to do business.
Ask yourself the following questions:
- Do you need a special degree to open a seismic surveying firm?
- Are there necessary licences or permits?
- What are the main laws applicable to your future business?
At this stage, your analysis of the regulations should be carried out at a high level, to familiarize yourself with any rules and procedures, and above all to ensure that you meet the necessary conditions for carrying out the activity before going any further.
You will have the opportunity to come back to the regulation afterwards with your lawyer when your project is at a more advanced stage.
Take stock of the lessons learned from your market analysis
Market research should give you a definitive idea of your business idea's chances of commercial success.
Ideally, the conclusion is that there is a market opportunity because one or more customer segments are currently underserved by the competition.
On the other hand, the conclusion may be that the market is already taken. In this case, don't panic: the first piece of good news is that you're not going to spend several years working hard on a project that has no chance of succeeding. The second is that there's no shortage of ideas out there: at The Business Plan Shop, we've identified over 1,300 business start-up ideas, so you're bound to find something that will work.
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How should I position my seismic surveying firm on the market?
The next step to start your seismic surveying firm is to define precisely the market positioning your company will adopt in order to capitalise on the opportunity identified during your market research.
Market positioning refers to the place your product and service offering occupies in customers' minds and how they differ from the competition. Being perceived as a low-cost solution, for example.
To find a concept and a market positioning that will resonate with your customers, you need to address the following issues:
- How can you differentiate yourself from your competitors?
- Is it better to start or buy a seismic surveying firm already in operation?
- How will you validate your concept and market positioning before investing in the business?
Let's look at these aspects in more detail.
How can you differentiate yourself from your competitors?
Opening a seismic surveying firm means starting with a major disadvantage compared with competitors already active on the market.
While you will have to create everything from scratch, your competitors already have everything in place.
Your competitors' teams know the business well, whereas yours has only just been recruited, their customers are loyal and they benefit from word of mouth that you don't yet have.
So you're going to need a solid plan to succeed in taking market share from your competitors and making your mark.
There are a number of aspects to consider in order to try to avoid direct confrontation if possible:
- Can you target a different customer base than your competitors?
- Can you offer products or services that are different from or complementary to what your competitors already sell?
- How will your competitors react to your seismic surveying firm entering their market?
- Can you build a sustainable competitive advantage that will enable you to compete with your current and future competitors?
Is it better to start or buy a seismic surveying firm already in operation?
The alternative to setting up a new independent business is to buy out and take over a seismic surveying firm already in operation.
A takeover is a good way of reducing the risk of your project compared with a pure start-up.
Taking over a business has two enormous advantages over setting up a new one: you start out on an equal footing with your competitors since you take over the team and the customer base, and you don't increase the supply on the market enabling you to maintain the existing balance on the market where the business operates.
However, the capital requirements for a takeover are higher because the business will have to be bought from its previous owners.
How will you validate your concept and market positioning before investing in the business?
However you decide to set up your business, you will need to ensure that there is a good fit between what you sell and what customers are looking to buy.
To do this, you'll need to meet your target customers to present your products or services and check that they meet their expectations.
Deciding where to base your seismic surveying firm
The next step to opening a seismic surveying firm is deciding where you want to set up your business.
Choosing the right location for your business is like finding the perfect stage for a play. Without it, your business may lack the spotlight it deserves.
Whilst there is no “perfect” location for your seismic surveying firm, one that meets as many of the following factors as possible could be ideal:
- Visibility and foot traffic: A seismic surveying firm needs to be easily visible and accessible to potential clients, as well as have a high level of foot traffic for potential leads and networking opportunities.
- Parking space, road and public transport accessibility: This is important for employees and clients who need to visit the firm's office or worksite. Having adequate parking space and accessibility to roads and public transport can also help with logistics and efficiency.
- Availability of skilled labor: A seismic surveying firm requires skilled and experienced employees, so being located in an area with a pool of qualified workers is crucial.
- Competitor presence: It is important to be aware of competitors and their locations in order to strategize and differentiate the firm's services.
This list is obviously not exhaustive and will have to be adapted to the particularities of your project.
Once you’ve considered the factors above, it’s important to think about the budget that your startup has at its disposal. You’ll need to find a location that meets your business requirements but is affordable enough, especially short-term.
If you opt for renting instead of buying your premises, make sure to take into account the terms of the lease, including aspects such as the duration, rent increase, renewal, and so on.
The lease contractual terms vary greatly from country to country, so be sure to check the terms applicable to your situation and have your lease reviewed by your lawyer before signing.
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Decide on a legal form for your seismic surveying firm
It's now time to think about the legal structure for your seismic surveying firm.
The legal form of a business simply means the legal structure it operates under. This structure outlines how the business is set up and defines its legal obligations and responsibilities.
What are the most common legal structures?
Naturally, the names and intricacies of business structures differ by country. However, they typically fit into two main categories:
- Individual businesses
- Companies
Individual businesses
Individual businesses are usually a good fit for self-employed individuals and freelancers who want limited administrative work. These types of entrepreneurs are commonly referred to as sole traders or sole proprietorships.
As mentioned above, the main benefit of being a sole trader is that minimal paperwork is required to launch and operate the business. Tax calculations are also relatively simple and annual accounts are not always required (and when they are, usually don't need to be audited) which saves a bit of time and money on bookkeeping and accounting fees.
Decision-making is also easy as the final decision is fully dependent on the sole trader (even if employees are hired).
However, being a sole trader also has drawbacks. The main disadvantage is that there is no separation between the individual running day-to-day operations and the business.
This means that if the business were to file for bankruptcy or legal disputes were to arise, the individual would be liable for any debts and their personal assets subsequently at risk. In essence, sole traders have unlimited liability.
This also means that profits earned by the business are usually taxed under the personal income tax category of the sole trader.
Another drawback is that sole traders might find it harder to finance their business. Debt (bank loan for example) is likely to be the only source of external financing given that the business doesn't have a share capital (effectively preventing equity investors from investing in their business).
Companies
Companies are more flexible and more robust than individual businesses. They are suitable for projects of all sizes and can be formed by one or more individuals, working on their own or with employees.
Unlike individual businesses, companies are recognised as distinct entities that have their own legal personality. Usually, there is also a limited liability which means that founders and investors cannot lose more than the capital they have invested into the business.
This means that there is a clear legal separation between the company and its owners (co-founders and investors), which protects the latter's personal assets in the event of legal disputes or bankruptcy.
Entrepreneurs using companies also gain the advantage of being able to attract equity investment by selling shares in the business.
As you can see companies offer better protection and more financing options, but this comes at a trade-off in terms of red-tape and complexity.
From a taxation perspective, companies are usually liable for corporation tax on their profits, and the income received by the owners running the business is taxed separately (like normal employees).
Normally, companies also have to produce annual accounts, which might have to be audited, and hold general assemblies, among other formalities.
How should I choose my seismic surveying firm's legal setup?
Choosing the right legal setup is often simple once you figure out things like how many partners you'll have, if you hire employees, and how much money you expect to make.
Remember, a great business idea can work well no matter which legal structure you pick. Tax laws change often, so you shouldn't rely too much on getting specific tax benefits from a certain structure when getting started.
You could start by looking at the legal structures most commonly utilised by your competitors. As your idea evolves and you're ready to officially register your business, it's a good idea to confirm your choice using inputs from a lawyer and an accountant.
Can I switch my seismic surveying firm's legal structure if I get it wrong?
Yes, you have the flexibility to change your legal setup later, which might include selling the existing one and adopting a new structure in certain situations. Keep in mind, though, that this restructuring comes with additional expenses, so making the right choice from the start is usually more cost-effective.
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Assess the startup costs for a seismic surveying firm
The next step in creating a seismic surveying firm involves thinking about the equipment and staff needed for the business to operate.
After figuring out what you need for your business, your financial plan will reveal how much money you'll need to start and how much you might make (check below for more details).
Because every venture is distinctive, providing a reliable one-size-fits-all budget for launching a seismic surveying firm without knowing the specifics of your project is not feasible.
Each project has its own particularities (size, concept, location), and only a forecast can show the exact amount required for the initial investment.
The first thing you'll need to consider is the equipment and investments you'll need to get your business up and running.
Startup costs and investments to launch your seismic surveying firm
For a seismic surveying firm, the initial working capital requirements (WCR) and investments could include the following elements:
- Seismic Data Acquisition Equipment: This includes specialized equipment such as seismic sensors, cables, recording systems, and data processing software. These are essential for collecting accurate data during seismic surveys.
- Drilling Equipment: Seismic surveying firms often need to drill boreholes to place sensors and collect data. This requires specialized drilling equipment such as drills, drill bits, and mud pumps.
- Vehicles and Transportation: A seismic surveying firm needs vehicles to transport equipment and personnel to and from survey sites. This includes trucks, off-road vehicles, and trailers.
- Office and Field Supplies: To operate efficiently, a seismic surveying firm needs various supplies such as computers, printers, office furniture, and field safety gear. These are fixed assets that are essential for day-to-day operations.
- Surveying and Mapping Software: In addition to data processing software, a seismic surveying firm may also need specialized surveying and mapping software to analyze and interpret seismic data. This includes software for 3D visualization and modeling.
Of course, you will need to adapt this list to your business specificities.
Staffing plan of a seismic surveying firm
In addition to equipment, you'll also need to consider the human resources required to run the seismic surveying firm on a day-to-day basis.
The number of recruitments you need to plan will depend mainly on the size of your company.
Once again, this list is only indicative and will need to be adjusted according to the specifics of your seismic surveying firm.
Other operating expenses for a seismic surveying firm
While you're thinking about the resources you'll need, it's also a good time to start listing the operating costs you'll need to anticipate for your business.
The main operating costs for a seismic surveying firm may include:
- Your staff costs, including salaries, bonuses, and benefits
- Accountancy fees for maintaining financial records and reporting
- Insurance costs for liability coverage and equipment protection
- Software licenses for specialized seismic data processing and analysis tools
- Banking fees for managing business accounts and transactions
- Fuel and transportation expenses for field operations and equipment maintenance
- Office rent and utilities for your headquarters and any field offices
- Marketing and advertising costs to promote your services and attract clients
- Training and professional development expenses for your staff to stay updated on industry advancements
- Travel expenses for business trips to meet with clients or attend conferences
- Equipment rental fees for specialized vehicles and machinery
- Permits and licensing fees for conducting surveys in different locations
- Legal fees for any necessary contracts or agreements with clients
- Maintenance and repair costs for equipment and vehicles
- Office supplies and equipment, such as computers, printers, and office furniture
Like for the other examples included in this guide, this list will need to be tailored to your business but should be a good starting point for your budget.
Creating a sales & marketing plan for your seismic surveying firm
The next step to start a seismic surveying firm is to think about how you are going to attract and retain customers.
You need to ask yourself the following questions:
- What actions can be leveraged to attract as many customers as possible?
- How will you then retain customers?
- What resources do you need to allocate for each initiative (human and financial)?
- How many sales and what turnover can you expect to generate in return?
How you will attract and retain customers depends on your ambition, the size of your startup and the nature of your exact concept, but you could consider the following initiatives.
Your sales forecast may also be influenced by seasonality related to your business type, such as fluctuations during busy holiday periods, and your competitive environment.
Can your business idea be profitable?
Just enter your data and let The Business Plan Shop crunch the numbers. We will tell if your business idea can generate profits and cash flows, and how much you need to get started.
Build your seismic surveying firm's financial forecast
The next step to start your seismic surveying firm: putting your financial projections together.
What is the financial forecast for a seismic surveying firm?
A forecast is a quantified decision-making document that shows the initial investment required to open a seismic surveying firm and the company's potential profitability and cash flow generation over the next 3 to 5 years.
As you think about your seismic surveying firm idea, the main role of financial projections will be to help you decide whether it makes sense to create the company.
Building a financial forecast helps determine the amount of initial financing required to start your seismic surveying firm.
In fact, creating financial projections is the only way to assess the amount of initial financing you'll need to open your seismic surveying firm, and to make sure your project makes economic and financial sense.
Keep in mind that very few business ideas are financially viable. At The Business Plan Shop, we've seen nearly a million business start-up ideas, and we estimate that less than one in four is economically viable.
Your forecast will therefore require your full attention and constant revision, as your project matures. It's also a good idea to simulate different scenarios to anticipate several possibilities (what happens if your sales take longer than expected to ramp up, for example), so you're ready for all eventualities.
When seeking financing, your forecast will be incorporated into your business plan, which is the document you will use to present your business idea to financial partners. We'll come back to the business plan in more detail later in this guide.
Creating and updating your seismic surveying firm's forecast is an ongoing process. Indeed, having up-to-date financial projections is the only way to maintain visibility over your company's future cash flow and cash position.
Forecasting is, therefore, the financial management tool that will be with you throughout the life of your company. Once you've started trading, you'll need to regularly compare the difference between your actual accounts and your forecasts, and then adjust them to maintain visibility over your future cash flows.
What does a financial forecast look like?
Once ready, your seismic surveying firm forecast will be presented using the financial tables below.
The forecasted profit & loss statement
The profit & loss forecast gives you a clear picture of your business’ expected growth over the first three to five years, and whether it’s likely to be profitable or not.
The projected balance sheet
Your seismic surveying firm's forecasted balance sheet enables you to assess your financial structure and working capital requirements.
The projected cash flow statement
A projected cash flow statement to start a seismic surveying firm is used to show how much cash the business is expected to generate or consume over the first three years.
Which solution should you use to make a financial forecast for your seismic surveying firm?
The easiest and safest way to create your seismic surveying firm forecasts is to use an online financial forecasting software, like the one we offer at The Business Plan Shop.
There are several advantages to using professional software:
- You can easily create your financial forecast by letting the software take care of the financial calculations for you without errors
- You have access to complete financial forecast templates
- You get a complete financial forecast ready to be sent to your bank or investors
- The software helps you identify and correct any inconsistencies in your figures
- You can create scenarios to stress-test your forecast's main assumptions to stress-test the robustness of your business model
- After you start trading, you can easily track your actual financial performance against your financial forecast, and recalibrate your forecast to maintain visibility on your future cash flows
- You have a friendly support team on standby to assist you when you are stuck
If you are interested in this type of solution, you can try our forecasting software for free by signing up here.
Finding a name and registering your seismic surveying firm
The next step in starting a seismic surveying firm is to decide on a name for your entity.
For starters, you cannot take a name similar to a name already registered by a competitor or protected by a trademark without inevitably risking getting sued. So you’ll need to find a name available, and reserve it before others can.
In addition, you will probably want to use the same name for:
- Your company’s legal name - Example LTD or Example Inc
- Your trading name - Example
- A trademark - Example ®
- Your company’s domain name - Example.com
The issue is that you’ll need to register your name in three different places almost simultaneously, but with each place having its own timeframes:
- Registering a domain name is instantaneous
- Registering a trademark takes at least 3 months (if your application is accepted)
- Registering a company depends on the country, but it's generally fairly quick
You will therefore be faced with the choice of either registering everything at once in the hope that your name will be accepted everywhere, or proceeding step by step in order to minimise costs, but taking the risk that someone else will register one of the names you wanted in the meantime.
Our advice is to discuss the strategy with your legal counsel (see further down in this guide) and to give priority to your domain names and your registered trademark. You'll always have the option of using a trading name that's different from your company's legal name, and that's not a big deal.
To check that the name you want is not already in use, you should consult:
- Your country's business register
- The register of trademarks where you wish to obtain protection
- Your preferred search engine
- A domain name reservation company (such as GoDaddy)
If the name you want is available, you can go ahead and register it.
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Deciding upon the corporate identity of your seismic surveying firm
The next step in opening a seismic surveying firm is to look at your company's visual identity.
Your company's “visual identity” plays a crucial role in shaping your brand image. It helps you to be recognizable and to stand out from your competitors.
Although you can define your visual identity yourself, it is generally advisable to call on the services of a designer or marketing agency to achieve a professional result.
At a minimum, you will need to define the following elements:
- Logo
- Brand guidelines
- Business cards
- Website theme
Logo
Your seismic surveying firm's logo allows others to quickly identify your company. It will be used on all your communication media (website, social networks, business cards, etc.) and official documents (invoices, contracts, etc.).
In addition to its design, it's important that your logo is available in a variety of colors, so that it can be seen on all media (white, dark background, etc.).
Brand guidelines
Having brand guidelines enables you to maintain consistency in formatting across all your communications media and official documents.
Brand guidelines define the font (family and size), design and colours used by your brand.
In terms of fonts, for example, you may use Roboto in size 20 for your titles and Lato in size 14 for your texts.
The colours used to represent your brand should generally be limited to five:
- The main colour,
- A secondary colour (the accent),
- A dark background colour (blue or black),
- A grey background colour (to vary from white),
- Possibly another secondary colour.
Business cards
Designing business cards for your seismic surveying firm is a must, as they will allow you to communicate your contact details to your customers, suppliers, partners, potential recruits, etc.
In principle, they will include your logo and the brand guidelines that we mentioned above.
Website theme
In the same way, the theme of your seismic surveying firm website will be based on your logo and the brand guidelines we mentioned above.
This involves defining the look and feel of your site's main graphic elements:
- Buttons,
- Menus,
- Forms,
- Banners,
- Etc.
Understanding the legal and regulatory steps involved in opening a seismic surveying firm
The next step in opening a seismic surveying firm is to take the necessary legal and regulatory steps.
We recommend that you be accompanied by a law firm for all of the steps outlined below.
Registering a trademark and protecting the intellectual property of your seismic surveying firm
The first step is to protect your company's intellectual property.
As mentioned earlier in this guide, you have the option to register a trademark. Your lawyer can assist you with a thorough search to ensure your chosen trademark is unique and doesn't conflict with existing ones and help select the classes (economic activities) and jurisdictions in which to register your trademark.
Your lawyer will also be able to advise you on other steps you could take to protect your company's other intellectual property assets.
Drafting the contractual documents for your seismic surveying firm
Your seismic surveying firm will rely on a set of contracts and legal documents for day-to-day operations.
Once again, we strongly recommend that you have these documents drawn up by a lawyer.
Your exact needs will depend on the country in which you are launching your seismic surveying firm and the size of the company you are planning.
However, you may wish to consider the following documents at a minimum:
- Employment contracts
- General terms and conditions of sale
- General terms and conditions of use for your website
- Privacy Policy for your website
- Cookie Policy for your website
- Invoices
- Etc.
Applying for licences and permits and registering for various taxes
The licenses and permits needed for your business will depend on the country where you are establishing it. Your lawyer can guide you on the regulations relevant to your activity.
Similarly, your chartered accountant will be able to help you register for taxes and take the necessary steps to comply with the tax authorities.
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Writing a business plan for your seismic surveying firm
The next step in opening a seismic surveying firm is to draw up your business plan.
What is a seismic surveying firm's business plan?
A business plan serves as a comprehensive roadmap outlining the objectives, strategies, and key components of your venture.
There are two essential parts to a business plan:
- A numerical part, the financial forecast we mentioned earlier in this guide, which highlights the amount of initial financing needed to launch the business and its potential profitability over the next 3 to 5 years,
- A written part, which presents in detail the project of creating a seismic surveying firm and provides the necessary context to enable the reader of the business plan to judge the relevance and coherence of the figures included in the forecast.
Your business plan helps guide decision-making by showcasing your vision and financial potential in a coherent manner.
Your business plan will also be essential when you're looking for financing, as your financial partners will ask you for it when deciding whether or not to finance your project to open a seismic surveying firm. So it's best to produce a professional, reliable, and error-free business plan.
In essence, your business plan is the blueprint to turn your idea into a successful reality.
What tool should you use to create your seismic surveying firm business plan?
If you want to write a convincing business plan quickly and efficiently, a good solution is to use an online business plan software for business start-ups like the one we offer at The Business Plan Shop.
Using The Business Plan Shop to create a business plan for a seismic surveying firm has several advantages :
- You can easily create your financial forecast by letting the software take care of the financial calculations for you without errors
- You are guided through the writing process by detailed instructions and examples for each part of the plan
- You can access a library of dozens of complete startup business plan samples and templates for inspiration
- You get a professional business plan, formatted and ready to be sent to your bank or investors
- You can create scenarios to stress test your forecast's main assumptions
- You can easily track your actual financial performance against your financial forecast by importing accounting data
- You can easily update your forecast as time goes by to maintain visibility on future cash flows
- You have a friendly support team on standby to assist you when you are stuck
If you're interested in using our solution, you can try The Business Plan Shop for free by signing up here.
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How to raise finance for my seismic surveying firm?
Once your business plan has been drafted, you’ll need to think about how you might secure the financing necessary to open your seismic surveying firm.
The amount of initial financing required will obviously depend on the size of your seismic surveying firm and the country in which you wish to set up.
Businesses have access to two main categories of financing: equity and debt. Let's take a closer look at how they work and what sources are available.
Equity funding
At a high level, the equity of your seismic surveying firm will consist of the money that founders and potential investors will invest to launch the company.
Equity is indispensable as it provides the company with a source of long-term (often permanent) financing and demonstrates the founders' conviction in the company's chances of success, since their investments would be lost in the event of bankruptcy.
Equity investors can generate a return on their investment through dividends (which can only be paid out if the company is profitable) or capital gains on the resale of their shares (if the company is attractive enough to attract a buyer).
As you can see, the equity investors' position is extremely risky, since their capital is at risk and can be lost in the event of bankruptcy, and the company must be profitable or resellable before they can hope to generate a return on their investment.
On the other hand, the return on investment that equity investors can expect to generate by investing in a seismic surveying firm can be very substantial if the company is successful.
This is why equity investors look for start-up ideas with very high growth or profitability potential, in order to offset their risk with a high potential return on investment.
In technical terms, equity includes:
- Share capital and premiums: which represent the amount invested by the shareholders. This capital is considered permanent as it is non-refundable. In return for their investment, shareholders receive shares that entitle them to information, decision-making power (voting in general assembly), and the potential to receive a portion of any dividends distributed by the company.
- Director loans: these are examples of non-permanent capital advanced to the company by the shareholders. This is a more flexible way of injecting some liquidity into your company than doing so as you can repay director loans at any time.
- Reserves: these represent the share of profits set aside to strengthen the company's equity. Allocating a percentage of your profits to the reserves can be mandatory in certain cases (legal or statutory requirement depending on the legal form of your company). Once allocated in reserves, these profits can no longer be distributed as dividends.
- Investment grants: these represent any non-refundable amounts received by the company to help it invest in long-term assets.
- Other equity: which includes the equity items which don't fit in the other categories. Mostly convertible or derivative instruments. For a small business, it is likely that you won't have any other equity items.
The main sources of equity are as follows:
- Money put into the business from the founders' personal savings.
- Money invested by private individuals, which can include business angels, friends, and family members.
- Funds raised through crowdfunding, which can take the form of either equity or donations (often in exchange for a reward).
- Government support to start-ups, for example, loans on favourable terms to help founders build up their start-up capital.
Debt funding
The other way to finance your seismic surveying firm is to borrow. From a financial point of view, the risk/return profile of debt is the opposite of that of equity: lenders' return on investment is guaranteed, but limited.
When it borrows, your company makes a contractual commitment to pay the lenders by interest, and to repay the capital borrowed according to a pre-agreed schedule.
As you can see, the lenders' return on investment is independent of whether or not the company is profitable. In fact, the only risk taken by lenders is the risk of the company going bankrupt.
To avoid this risk, lenders are very cautious, only agreeing to finance when they are convinced that the borrowing company will be able to repay them without problems.
From the point of view of the company and its stakeholders (workforce, customers, suppliers, etc.), debt increases the risk of the venture, since the company is committed to repaying the capital whether or not it is profitable. So there's a certain distrust towards heavily indebted companies.
Companies borrow in two ways:
- Against their assets: this is the most common way of borrowing. The bank finances a percentage of the price of an asset (a vehicle or a building, for example) and takes the asset as collateral. If the company cannot repay, the bank seizes the asset and sells it to limit its losses.
- Against their future cash flows: the bank reviews the company's financial forecast to estimate how much the company can comfortably borrow and repay, and what terms (amount, interest rate, term, etc.) the bank is prepared to offer given the credit risk posed by the company.
When creating a seismic surveying firm, the first option is often the only one available, as lenders are often reluctant to lend on the basis of future cash flows to a structure that has no track record.
The type of assets that can be financed using the first method is also limited. Lenders will want to be sure that they can dispose of foreclosed assets if needed, so they need to be assets that have an established second-hand market.
That being said, terms and conditions also depend on the lender: some banks are prepared to finance riskier projects, and not all have the same view of your company's credit risk. It also depends on the collateral you can offer to reduce risk, and on your relationship with the bank.
In terms of possible sources of borrowing, the main sources here are banks and credit institutions.
In some countries, it's also possible to borrow from private investors (directly or via crowdlending platforms) or other companies, but not everywhere.
Takeaways on how to finance a seismic surveying firm
Multiple options are available to help you raise the initial financing you need to launch your seismic surveying firm.
There are two types of financing available to companies. To open a seismic surveying firm, an equity investment will be required and may be supplemented by bank financing.
What to do after launching my seismic surveying firm?
Launching your seismic surveying firm is the beginning of an exciting entrepreneurial adventure, and the culmination of your efforts to turn your idea into a reality. But this is also when the real work begins.
As you know, nearly half of all new businesses fail, so you'll need to do everything you can to make your business sustainable right from the start.
Estimating the future financial performance of a seismic surveying firm inevitably involves a degree of uncertainty. That's why we recommend simulating several scenarios: a central case with the most likely scenario, an optimistic case, and a pessimistic case designed to test the limits of your business model.
Normally, your company's actual financial performance, observed after you start trading, should fall somewhere between your pessimistic and optimistic cases.
The important thing will be to quickly measure and compare this actual performance with the figures in your forecast to see where you stand, then update the forecast to re-estimate the future cash flows and cash position of your seismic surveying firm.
This forward-looking financial management exercise is the only way to know where you stand and where you're going. And, when your figures fall short of expectations, to quickly implement actions to turn things around before the company runs out of cash.
There's nothing more dangerous than waiting until you have your accounts, which takes up to nine months after the end of your financial year (if you are in the UK, abroad your mileage will vary), to then realize that you're not on the right track and that your seismic surveying firm won't have enough cash to operate over the next twelve months.
This is where using a forecasting solution that integrates actuals vs. forecast tracking, like The Business Plan Shop's financial dashboards do, can simplify the financial management of your business and help reduce the risk associated with your start-up project.
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Key takeaways
- To open a seismic surveying firm you need to go through each of the 15 steps we have outlined in this guide.
- The financial forecast is the tool that will enable you to check that your project can be profitable and to estimate the investment and initial financing requirements.
- The business plan is the document that your financial partners will ask you to produce when seeking finance.
- Once you have started trading, it will be essential to keep your financial forecasts up to date in order to maintain visibility of the future cash flow of your seismic surveying firm.
- Leveraging a financial planning and analysis platform that seamlessly integrates forecasts, business plans, and real-time performance monitoring — like The Business Plan Shop — simplifies the process and mitigates risks associated with launching a business.
We hope this practical guide has given you a better understanding of how to open a seismic surveying firm. Please do not hesitate to contact our team if you have any questions or if you would like to share your experience of setting up your own business.
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Founder & CEO at The Business Plan Shop Ltd
