It will take a lot of hard work and dedication so it is advisable that you do something you are passionate about or at least something you don’t mind spending time nurturing and growing.
Calculate how much available capital you’ll use to start your small business. The more money you have, the wider your options for the type of small business you can start. Consider getting a business loan or begin to build business credit to finance your business start-up.
Select the type of small business you want to start. Start with something you are passionate about or at least interested in. The possibilities are virtually endless. See business ideas for start-ups under $500.00.
Research the field you are entering. The Internet has made it very simple to perform research. There is lots of free information that will aid you in your task. Examine the field, find your competitors and see how their business is structured.
Marketing is key for any small business. Brainstorm ways you can market your business and create a niche in your chosen area.
Prepare a Business Plan or Plan of Action. Writing a business plan can be a daunting task. If you are planning to apply for a small business loan, having a business plan is helpful. However, not everyone is prepared to write a full plan and many successful businesses have started without a complete business plan.
If writing a business plan is not something you wish to do, at least take time to write a simple Plan of Action. Your plan of action should include your financing needs, marketing ideas and step by step action to take you to your goal of starting a functioning small business.
Determine how you will structure your business. Choose between a sole proprietorship, partnership, corporation or LLC. Each type of structure has different rules and liabilities. The simplest structure is a sole proprietorship and if you have no employees there is no need to become a corporation right away. It’s easy to upgrade your business to a corporation down the road. However, if you have employees or plan to sell a product that may trigger a lawsuit, you might want to consider incorporating sooner than later.
Apply for an EIN (Employee Identification Number). You may obtain an EIN from the IRS online. (www.irs.gov). The application is real simple and takes about 5 minutes. As a sole proprietor you may apply or if you are a corporation any officer may apply. You’ll receive it immediately.
Get your business license. For certain types of businesses, you must file for a license. The Small Business Administration website can tell you if you need a business license for your chosen type of business. Once you are licensed, you can begin conducting business.
Open a Business Checking Account. It’s best to have a separate account for all business transactions. If you are not a corporation, tell your bank you want to set up a DBA (Doing Business As) account or they may not deposit checks made out to your business name. Get your business name on your checks. A basic business checking account should not cost you over $10.00 a month. This gives your business a professional look and allows you to begin to establish a relationship with your bank for possible future financing.
Register you Business Name. When starting a new business always register your business name, even if it’s a home-based business. If you decide to incorporate, your business name will be registered in accordance with your State’s incorporating requirements. If you structure your business as a sole proprietor register your business in the appropriate county or province.
Registering your business is a very important initial step in starting a business. It not only allows you to see if someone else has registered a business in that name, but also enables you to open a business checking account.