Not sure how to make your business dream a reality? Take the guesswork out of the process. Read on to learn how to start a small business in ten steps.
Step 1: Write a Business Plan/Do Your Research
Start to put your vision for your venture to paper through a thorough business plan. This should have your business proposition and market analysis. Don’t forget your organizational and managerial strategy, too. Your marketing and sales plans must also be in this plan. Don’t forget to include funding requirements and future financial projections.
Step 2: Pick a Business Location
Will you be operating a brick-and-mortar business? Or, do you prefer to run a home-based business? Choose a location that is attractive to potential customers or clients. Then, lease the space and follow any zoning laws.
Step 3: Fund Your Business
Your venture can’t take flight if you can’t fund it on your own or find an investor to back it. Research and secure funding sources ranging from government-backed loans to venture capital. Supply potential investors with your business plan to educate them about your business proposition.
Step 3: Choose a Legal Form for Your Business
How you legally organize your business can protect or expose your personal assets for use by creditors. It can also affect your taxes. Decide on the form and then file relevant paperwork for the form selected, if any.
Step 4: Register a Business Name
Do you want to operate a sole proprietorship under a business name different from your given name? Or, perhaps you want to operate an LLC or corporation under a different from the name on your original LLC or corporation paperwork? You can register a fictitious “Doing Business As” (DBA) name with your county clerk’s office or state government.
Step 5: Follow State Tax Laws
If your state requires a state tax identification number (TIN), register a TIN. Your state may also need you to cover workers’ compensation, unemployment and disability insurance. Following tax laws when you start a small business will save a lot of headaches down the road.
Step 6: Insure Your Business
For some industries, it is not only wise but necessary to hold business insurance in addition to state-mandated insurance for employees. Assess whether insurance is needed for your business. If so, consult an insurance agent to determine what type of insurance is sufficient to protect your business assets.
Step 7: Get Required Licenses and Permits
Federal, state and local law may mandate that you get specific licenses or permits to operate. This can include occupational licenses or licenses for offering a particular product or service.
Step 8: Be Aware of Employer Responsibilities
Will you be hiring employees for your business? Ensure that you research and comply with tax and labor laws. This can range from securing worker protections to withholding the required taxes from wages.
Step 9: Equip Yourself and Your Business
Get the right tools for your business. This includes digital tools. It’s easy to want to skimp on the cost of tools and services at the beginning but make sure you’re doing a full calculation. How much is your time worth? Have a good idea of that and then decide which aspects of your job you’re willing to learn and which ones you can pay others to do so you can focus on things you’re great at.
Step 10: Don’t Forget About Marketing
Take small business training to learn how to start a small business and keep it running smoothly. Ratchet up your marketing efforts to help secure your desired customers or clients. Lastly, be sure to stock up on any equipment, product inventory or office supplies before opening for business.
MileIQ’s blog does not constitute professional tax advice. You should contact your own tax professional to discuss your situation.