Starting your own business is an opportunity that is much easier to take advantage of these days. However, there are important things to keep in mind when you come across any of these exciting opportunities. Planning must be done thoughtfully. Key financial decisions need to be made and legal requirements must be met. Follow this set of guidelines to start your own business on the right foot.
The first and most important thing to do is to write a business plan. This plan will be a road map on how your business will be launched and how it will stay in operation.
It should include a description of the business in terms of its legal structure, what products or services are offered, personnel and management, how records are kept, insurance matters, and security issues.
Another segment of the business plan should deal with the marketing side. This includes your target markets, the competition, advertising, pricing, locations and industry trends.
The financial part of your plan must include a description of financial needs, where funds will come from, an operating budget, income projection, a break-even analysis, and the actual financial statements of the operation. The business plan will also contain any other supporting documents like reference letters, credit statements, leases, contracts, and other legal documents.
Attending training classes and counseling services for small business owners are very helpful when just starting your own business. These classes teach you how to write your business plan and ways to secure financing.
You should select the location for your business. It can be your home or elsewhere. Your business must comply with the zoning laws of the location that you have selected.
Explore options in financing your business. Funding can be obtained from loans backed by the government, research grants, venture capital, and other sources.
Make a decision on how the business will be legally structured. There are several basic forms of business ownership. If you plan to run your business on your own, with no distinction between you and your business, this will be a sole proprietorship.
When ownership of the business is shared with another person, this will be a partnership.
If the business will be its own entity and will be owned by one or more shareholders, namely you and anyone else who wants to own a piece of the business, then a corporation will be formed.
There are other structures, and it is best to consult with a business attorney when determining the legal business structure.
A business name needs to be registered with the appropriate state agency. This is the name under which the business will operate.
If you plan to hire employees, there are legal steps that you must follow as an employer. Learn what those are to ensure full compliance.
A tax identification number will need to be obtained from the IRS. Your business must be registered with your state in order to get a tax ID number so that state and local taxes can filed for workers compensation, disability and unemployment insurance. Business licenses and permits will need to be obtained.
When you start your own business, there are many things that need to be carefully researched. If the planning is done correctly, your new business will be off to a good start for success.