Do you have an idea for a small business? Have you always dreamed of having your own business? Starting your own small business requires effort and planning. You will need to make key financial decisions and undertake legal proceedings. It’s important to take the following steps in order to make sure you create the foundation you will need for your small business to thrive.
1. Create a business plan.
If you aren’t sure what a business plan is, or what it entails, it’s time to find out. Though you don’t have to be an MBA graduate to write a business plan, you do have to have a very precise idea of the product or service you want to sell, how you will market that product or service, who you will market it to, how you’ll organize and delegate work in your company, sources of funding, and projected expenses and profits. You can think of your business plan as a specific, highly-targeted roadmap to success.
2. Get training or take a course for first-time business owners.
Training and courses can help to answer most of the questions you have about how to get your business off the ground. Many colleges, community, and government institutions offer training to help small business owners take crucial steps like registering, marketing their product or service, or securing financing from investors.
3. Choose your location.
Depending on what you do, you may choose to run your business from your own home. Other small business owners will need a storefront. Before you choose your location, find out more information about zoning laws in your city and financial obligations you might have such as taxes as a commercial property owner or renter.
4. Find financing.
This is one of the areas that most first-time small business owners struggle with. Are you comfortable financing your business out of your own pocket? Taking the time to seek out sources of financing such as government-backed loans, grants, and venture capital can help to take the burden off your personal finances.
5. Decide on a legal structure for your business.
Which type of ownership will suit your business needs best? A sole proprietorship, Limited Liability Company (LLC), a corporation, an S corporation, a non-profit, or a cooperative? It’s up to you to choose the structure that fits.
6. Register your business name.
Contact your state government to register the name of your business. You will also have to find out what kind of tax identification number to apply for from the IRS, along with the revenue agency in your state.
7. Register to pay local and state taxes.
Register your business in your home state to get your tax id number and qualify for workers’ compensation and unemployment insurance.
8. Obtain any necessary permits.
Talk to an advisor or do research to find out if you need any special permits or licenses to conduct your business. If so, you will have to provide the documents necessary to apply for them.
9. Become an employer.
If you plan on hiring employees, you will need to familiarize yourself with the legal obligations employers have to employees. Before you hire anyone, understand your position as an employer.
10. Make use of ongoing support.
Once your business is set up and running, keep in touch with your local small business office to continue to grow your knowledge and increase your network of support.