Starting a business requires research, smarts, confidence, and fearlessness. You may already be asking yourself: How can I start my own business if I have no money? What is the right equipment? Are you getting the best advice?
Here we'll walk you through the essential steps to start your business, from choosing the right business idea, creating a solid business plan, and building your company to opening a business bank account and choosing the right accounting software.
Features
1. Find the right opportunity
What kind of business should I start? It depends on your expertise as well as how much time and money you are willing to invest. Some small business ideas can be started from home with little overhead. Additionally, e-commerce and remote business are becoming increasingly common in the wake of the COVID-19 pandemic.
When narrowing your scope, you also need to check your own scope. ideas can actually make money. If you're not sure what type of business you want to run, use the list below to get your wheels spinning.
A strong business plan will help you prepare for every aspect of your business. You will also need it to present it to potential investors and lenders. This document should include details such as the products or services you plan to offer, your plan to generate revenue, and the talent you need on your team.
It should also include detailed financial projections, a budget, and a thorough explanation to investors of how the funds or loans will be used. Because cash flow forecasts change as you adjust your projected income and expenses, it's helpful to think of your plan's financials as a living, changing document.
Ultimately, a business plan will help guide your business, anticipate potential obstacles, and consider how to overcome them. It will likely take multiple iterations before your idea becomes a reality. Industry colleagues and accountants can provide valuable feedback on how realistic your projections are and may point out any overlooked costs.
3. Choosing a business structure
The legal structure of your business can affect everything from taxes to liability coverage. For example, there is no legal distinction between a sole proprietorship and its owner. However, a limited liability company (LLC) and its owners are considered separate entities by law, allowing for greater protection of personal assets.
Consulting with a tax professional can help you choose the right business structure. You can also change the structure as your business grows.
Obtaining an Employer Identification Number (EIN) is required by most businesses to file taxes, open a bank account, and perform other important tasks. Even if you don't have any employees, you can still benefit from getting an EIN. Applying is free and takes only a few minutes to apply online.
5. Apply for licenses and permits
Generally, restaurants require a health inspection and a liquor license. Cosmetologists need a cosmetology license. Your city may require you to apply for a business license, no matter what field you work in. Additionally, if you renovate your space to sell products or sell services, you may need to request a zoning change from your local government.
Make sure to schedule some time early to make sure you know what licenses and permits you need before you open your doors. You typically don't need a lawyer to apply for a business license, but they can help you navigate the process and review other documents, such as lease agreements and loans, before signing. Industry associations, city officials who work on economic development issues, and local business associations such as chambers of commerce may also be able to provide advice.
We start with a quick survey to better understand your business's unique needs.
Once we have found your personalized match, our team will be happy to discuss the further process.
6. Open a business bank account
Separating your business and personal finances is the key to managing your business finances. This is standard bookkeeping hygiene and makes it easier to deduct business expenses come tax time. Business bank accounts are helpful and easy to set up.
7. Understand startup funding options
Most businesses require a little capital to get started. However, the majority of business loans are not available to businesses that are less than 6 months old, and most online lenders want them to be at least a year old. Start-ups should consider alternative financing options or seek to leverage other strengths of the business, such as strong credit or collateral. If your business is eligible for financing, be sure to pay attention to interest rates, potential upfront fees, and personal liability terms.
Features
Establishment of a bank for small and medium-sized enterprises
Many business owners rely on their own savings to start a business. You can also consider crowdfunding, personal loans, and business grants. Start-up companies with high growth potential may also be eligible for equity financing, which gives investors partial ownership or equity in exchange for capital.
Is your to-do list huge?
8. Get a business credit card
Business credit cards can also be used as a short-term financing solution to help you buy needed items or pay bills when cash flow is still unstable. To avoid getting stuck in a cycle of debt, be sure to spend within your limits and pay off your balance in full each month. Aside from funding your start-up, business credit cards make it easier to separate your business and personal finances. As an added bonus, you can also earn benefits such as cashback on the amount you spend.
You can usually qualify for a business credit card based on your personal credit score.
9. Choose the right accounting software
It's important to keep records that show how much income you earn and how much you spend. Accounting software can help you track and analyze these numbers by creating reports and recording sales trends. There are also free options.
As your business grows, bookkeeper. This person will ensure your records are complete and accurate and will facilitate things like filing your taxes and applying for loans.
10. Prepare to pay taxes
As a business owner, you will have new tax obligations. This includes the possibility of having to pay taxes throughout the year, not just at tax season.But perhaps there will be some discoveries new tax cutstoo.
Filing taxes can be complicated, especially for small business owners. Building a relationship with a tax professional early on can help set you up for success and help you become a trusted advisor to your business down the road.
11. Protect yourself with business insurance
Protecting your business and personal assets is important, and business insurance exists to do just that. NerdWallet recommends that all businesses carry general liability insurance to protect against legal claims.
You may also need insurance to comply with a contract, such as setting up a booth at an event or working as a subcontractor on a large project.
12. Establish an online presence
Online presence is important for almost every business. This is especially important if you want to sell your products online. Even if it's simple, setting up a website and social media profiles early on will help you start building relationships with potential customers right away.
Here's what you need to know to start a business website.
13. Set up your payment system
If your business uses credit or debit cards, you'll likely need a payment processor and point-of-sale (POS) system. Many POS system providers also double as processing companies, which can simplify the decision-making process. Don't forget to factor in the initial cost of the card reader or his POS register hardware, his monthly POS software fees and processing fees. Online payments usually have higher processing fees than in-person payments, so be sure to consider any fees when choosing a provider.
You may not need to hire employees right away. Additionally, some small business owners prefer to remain sole proprietorships throughout the life of their business. However, if you choose to hire, you will likely need things like workers' compensation insurance and payroll software. Here are the steps to take when hiring your first employee.
15. Raise money to grow your business
You can qualify for a business loan after you've been in business for 6 to 12 months. Financing can help you grow and expand your business by purchasing equipment, renovating your office, expanding your inventory, or helping you get through slow periods for future revenue growth.
Here's what you need to know about business loans, lines of credit, and other financing options.
