Starting your own business can be a challenge if you don’t do anything about business. It can be problematic during the planning stages or can fail right after the first month. There are many ways to ensure that the business you have will grow and earn a steady income.
Before you think of ways to earn, you have to make sure that you have completed your start-up checklist, and though this varies amongst different businesses, these are the usual ways that most people follow:
1. Create your business plan
This will be the beginning of everything – the answer to the following questions:
- What kind of business?
- Who are your targets?
- Where do you plan to put up your business?
- Who will manage?
- What will be the structure?
You have to write down your business plan and plot everything you need to make it come true. It will show how serious you are in having your own business.
For example, you are planning to put up a merchandise shop. What are the things you offer in a merchandise shop? There are many like personalized t-shirts, caps, mugs, pillows, etc. To jumpstart your merch shop, you must have the equipment and materials such as an auto-release heat press machine to put the personalized design to the t-shirt, industrial printers, plain mugs, plain pillows, plain t-shirts, and many more.
Investors will also look for this, especially if you are planning on loaning money for your business. The business plan will show your future investors what kind of business you want to put up, how you understand creating your own business, how much you need to spend to put up the business, and the risks and rewards you can earn.
2. Learn the differences between legal structures
The business that you want needs a legal structure. After writing down your business plan and thinking of a name, you must register your business for tax, liability, and other organizational purposes. Your company’s legal structure will depend on the following requirements:
- The size of your company.
- The start-up cost of your business.
- The potential legal liability.
- The type of taxes you have to pay.
These requirements will answer which legal structure you have to register your business into. The four most common types of legal structures are as follows:
A. Sole Proprietorship
– This type of legal structure is the easiest to create as the paperwork needed is very minimal, but this ties your taxes and expenses to your business. This type will not allow you to employ anyone, thus the sole title proprietor.
B. Limited Liability Company (LLC)
– this type of legal structure combines a partnership, a corporation, and a sole proprietorship. This can comply with the three types of legal structures
– this type of legal structure is created when two people create the business. This means that there can be two individuals who will own the business. In some instances, this may involve two businesses that will merge as one.
– this type of legal structure is owned and controlled by a group called shareholders. This may also be a conglomeration of different businesses merging to form a single business.
3. You have to get your business registration, licenses, and tax identification
This means that after thinking of a name and getting investors, you have to register your business, get the licenses, and know the tax identification of your business. This will make your business legal and legitimate and recognized by the state.
4. Research on the target market and competition
Knowing the market in your area will help you determine the flow of people and their spending behavior. This will also allow you to decide what kind of service or product you should offer. The competition will let you, as a business owner can be innovative and creative in presenting your business in the market.
5. How much does your business cost?
The amount you will spend to start up your business, the potential income you will gain, and the possible amount you need in the future will matter when you start your own business. The investors will look at your financial capability, the market potential of your business, and the business’ capacity to gain income.
6. Secure the location of your business
The location of your business is a must when starting up. This will be based on your preferred or needed location. Choosing your home as your office address should also include a separate area for all business transactions. In securing a business location, you should also include how you will manage your bills: electricity, water, phone, internet service providers, and other utilities, plus the contract of lease or purchase of the location.
This will be dependent on what type of legal structure you have for your business. If you are going to hire employees, you need to have healthcare insurance. If you buy a vehicle for your business, get vehicle insurance. You have to know the local regulations that will require you to get any insurance for your business.
8. Seek Legal counsel
Having a lawyer will allow you to learn all the legal terms, conditions, regulations, and requirements needed for your business. It will always be a good idea to have a lawyer for various needs in corporate, tax, intellectual property, labor laws, and even international law. Knowing the law will allow you to decide based on legal terms and avoid any violations that you might face or commit in the future.
9. Have a contract with local and national resources
The best way to make your business prosper locally is to have local producers in your list of resources. This will also help you in your legal structure when you have listed your business in the local corporation commission. Knowing the law means you can be compliant with the IRS or the Internal Revenue Services, which is responsible for enforcing tax laws in the country. This service will also aid you in your future endeavors with your business, whether you choose to expand or maintain the legal structure of your business.
10. Check everything on your list
It is wise to double or even triple-check everything on your list before opening your business. You have to make sure that you have completed everything you need, not having any trouble when you open your business.
All these things will guide you in making the best decision in your business life. Becoming a business owner is not easy, and it should always follow a process and include every possible circumstance you might face before opening that dream business you have. Knowing all the legalities before starting up your business; otherwise, you might encounter issues that you were never prepared to face.