What are the steps to starting a business?
I am a Junior in High school and my friend and I both came up with a good idea for a clothing business. We are going to be an online business. But I have heard from other people that I have to go to city hall to register my business and some have said I do not have to. Can someone please set the record straight as to whether it is required to go to city hall and register my business or I could just create a website and begin promoting my company and selling products directly. I would really appreciate the help. Thanks.1 year ago - 2 answers
Before you can start any company (even online only) you'll need to go to City Hall to register your business. You'll need to get a business permit. You'll also have to register with the State Board of Equalization (at least here in Ca.)You'll be asked (when you register ) to show a written (by a lawyer) business plan and how much money you expect to make in your first year of business. Once you give them that figure they will assign you a fee that must be paid EVERY YEAR to keep the license current .You cannot do business without a license. They will also sign your business up for tax purposes and you might have to pay the first years taxes IMMEDIATELY based on your guesstimated income.
It's a lot of work and costs some money. For a small home-based business my guess would be that your yearly fee would be somewhere in the $200-400 range. Tax is paid yearly,tho some states require it to be paid every six months. My experience with this is here in California. Laws might be slightly different depending on what state you live in (You will follow STATE laws as well as additional local laws.) The business license fee is paid to your CITY. The taxes are paid to the State Board of Equalization. These are 2 different fees and are 2 different amounts and each are due yearly-as long as you business is running. If the business doesn;t work out you will have to go back through the same process to CLOSE your business.
It sounds kind of scary but the folks will generally be friendly to you when they see you are a young man without experience. You might want to visit the local city hall to see if they have free brochures or info they give out to see what they require to run a small business. If you live in a BIG CITY the paperwork,documents will be mind-blowing. If you live in a small town,it will be much easier to do. Everything will be based on your zip code.
The other thing you might consider is not starting a company but selling your items on Ebay. No paperwork there. All you have to do is register and sell. For Ebay you must be 18 and register a legitimate credit card and bank checking account to get started selling. It's very simple but you'll need some help (from friends /family who sell there). There is an initial period of CONFUSION,but after a few listings it will be a piece of cake. You won;t need the business license but you will need to pay a commission to Ebay and Paypal. Hope this helps. Good luck.