Steps to Starting a Business:
New businesses face many challenges, from planning and licensing to opening bank accounts and creating a company website. Regardless of where you are in the process, Arzo Enterprises can help. Follow each step on our checklist to stay on the right track.
- Do your market research: Just because you build it or sell it doesn’t necessarily mean anyone will buy it. The first essential step is to research your potential market. Who needs what you are offering? Is there space for your product or service in the market or is the market saturated? Is the market national? Is it a niche? Can you define your ideal customers? These are all questions that need to be answered before you even consider starting a business. Too many entrepreneurs have found out the hard way that there was not enough market share for them to capture. Others have realized that their target market audience was far too limited to make their business work.
- Write a business plan. Form goals and objectives for your new company. A successful start to any business requires a detailed outline of what you plan to accomplish.
- Show yourself the money: You can’t start a business without capital. Determine what you have, what you will need and how you will go about getting it. If you plan to seek investor funding or financing, start writing a business plan and practice your pitch. Research the costs associated with your business. Know how much money you’ll need and decide where it could come from. Obtain start-up capital. Whether you use your own savings or obtain loans, starting a business requires money. The loan process can take months to complete, so start early. Lenders often request a completed business plan prior to approval of funding.
- Set up a legal business structure. Forming a corporation or LLC can protect owners’ personal assets from business debts. Additionally, incorporating can provide credibility and tax benefits. Let Arzo Enterprises help you incorporate or form an LLC.
- Hire a good accountant: An accountant will work in conjunction with your attorney and be instrumental in determining the best form of ownership. He can also help you establish bookkeeping and other record keeping procedures that can keep you on track for years. Most important, a good accountant will help with tax planning. “You will also want an accountant who understands the state laws, since every state has its own little intricacies, such as sales tax issues,” Talis says, adding that it’s important for your accountant to be familiar with startup ventures.
- Hire a good business attorney: You don’t necessarily need to have an attorney on a retainer, but you’ll want to hire an attorney experienced with new businesses to help you get started. Your attorney can advise you about such things as drafting contracts, reviewing your lease and determining the right business structure. “A good attorney will know what it is that you are trying to do and help you structure your business in a way that will be beneficial to you,” says Chris Talis, senior partner at Hedgerow Mergers Acquisitions in Teaneck, N.J. The best way to find a good attorney is by referral or through networking.
- Decide on a business structure: Your choices include sole proprietorship, partnership, corporation, “S” corporation or limited liability corporation (LLC). Personal liability, taxes, paperwork and regulations vary greatly among the different legal business structures. Your attorney and accountant will play a key role in assisting you in this important decision.
Register “Doing Business As” names. Will your corporation or LLC do business under a name other than its legal name filed with the Secretary of State? If so, it must file a DBA (Doing Business As) name.
- Decide on a business name: It may seem obvious and simple, but the name is how your business will be known to the world. The right name says a lot about your company. Make a list of potential names and narrow the list down to the one that best describes your company in a few words, while being catchy, easy to remember, easy to pronounce and easy to spell. You should also consider how it will translate to a web domain name. You’ll also need to do research to see if there are a) similar business names and b) similar domain names.
- Satisfy business licensing requirements: Most state, county, and local governments require businesses to obtain licensing before they begin to operate. We can provide you with the application forms and contact information for the appropriate agencies.
Get all necessary licenses and permits: Along with a business license, you may need to get additional licenses depending on the type of business and local laws. Many professionals, such as contractors and real estate agents, need to be licensed in the states in which they work. Additionally, you may need licenses to manufacture and/or sell specific products such as liquor, firearms or even lottery tickets. Research all licenses applicable in your county and your state. It’s also extremely important to know the zoning laws before you open a business. Don’t assume the zoning laws don’t apply to you. You can get information on zoning from your local county clerk’s office.
- Appoint a Registered Agent. Businesses must maintain an address for service of process where legal documents can be received. Arzo Enterprises provides Registered Agent service for all companies that we form.
- Protect your company’s name. Businesses file names on a per-state basis, so other companies may be using the same or a similar name in other states. Conducting a trademark search ensures that your unique company name isn’t already in use.
- Obtain a Federal Employer Identification Number (EIN). Incorporated businesses and companies that hire employees must obtain an EIN.
- Satisfy insurance requirements. Incorporating or forming an LLC does not provide a company with business insurance. Most companies obtain general business insurance from an insurance provider. Corporations and LLCs that hire employees also typically obtain unemployment and workers compensation insurance.
- Establish a business presence. Identify a location for the business and establish a business address.
- Establish a Web presence. Not having an effective Website eliminates opportunities for new customers and more profit.
- Develop business collateral. Businesses use customized letterhead, cards, and forms with their company name and logo to establish credibility. Vista Print makes “do-it-yourself” business cards, business identity products, advertising products, and signage a snap.
- Open a bank account and merchant account. To protect their corporate or LLC veil, businesses must maintain separate business and personal accounts and records. Establish a separate business bank account so that your personal assets are not co-mingled with business funds. Banks require an Employer Identification Number (EIN) in order to open a business checking account.
- Get a business credit card. A business credit card helps separate your professional and personal expenses and can help you protect your personal assets from business liabilities.
- Identify where to get help. Smart business owners know where and when to seek advice from other sources. Identify attorneys and accountants in your area who can assist you with specific questions about your business, or contact us to help identify a solution to meet your needs.
- Get started. Schedule an opening day for your business. Giving yourself a goal helps keep things on track and can increase your productivity.
- Complete additional filings as needed. Companies that expand to do business outside their original state of incorporation or LLC formation generally register in the those additional states.