Thinking about starting a business? You're not alone. Every year, thousands of Americans catch the entrepreneurial spirit, launching small businesses to sell their products or services. Some businesses thrive; many fail. There is no one magic secret to creating a successful business -- if there were, all businesses would be successful -- partly because there will always be factors beyond an owner's control, such as the state of the market and the economy.
Still, the more you know about starting a business, the more power you have to form an organization that develops into a lasting source of income and satisfaction. For help with the beginning stages of operating a business, the following checklist is a great place to start.
[ ] Determine if the type of business suits you.
[ ] Use a break-even analysis to determine if your idea can make money.
[ ] Write a business plan, including a profit/loss forecast and a cash flow analysis.
[ ] Investigate business financing.
[ ] Set up a basic marketing plan.
[ ] Research the various types of ownership structures:
[ ] Identify the factors involved in choosing a business structure:
[ ] Get more in-depth information from a self-help resource or a lawyer, if necessary, before you settle on a structure.
[ ] Think of several business names that might suit your company and its products or services.
[ ] Check the availability of your proposed business names:
[ ] Choose between the proposed names that are still on your list.
[ ] Register your business name:
[ ] Sole proprietorship: N/A
[ ] Partnership:
[ ] LLC:
[ ] C Corporations:
[ ] S Corporations:
[ ] Identify the features and fixtures your business will need.
[ ] Determine how much rent you can afford.
[ ] Decide what neighborhood would be best for your business and find out what the average rents are in those neighborhoods.
[ ] Make sure any space you're considering is or can be properly zoned for your business. (If working from home, make sure your business activities won't violate any zoning restrictions on home offices.)
[ ] Before signing a commercial lease, examine it carefully and negotiate the best deal.
[ ] Obtain a federal employment identification number by filing IRS Form SS-4 (unless you are a sole proprietorship or single-member limited liability company without employees).
[ ] Obtain a seller's permit from your state if you will sell retail goods.
[ ] Obtain state licenses, such as specialized vocation-related licenses or environmental permits, if necessary.
[ ] Obtain a local tax registration certificate, a.k.a. business license.
[ ] Obtain local permits, if required, such as a conditional use permit or zoning variance.
[ ] Determine what business property requires coverage.
[ ] Contact an insurance agent or broker to answer questions and give you policy quotes.
[ ] Obtain liability insurance on vehicles used in your business, including personal cars of employees used for business.
[ ] Obtain liability insurance for your premises if customers or clients will be visiting.
[ ] Obtain product liability insurance if you will manufacture hazardous products.
[ ] If you will be working from your home, make sure your homeowner's insurance covers damage to or theft of your business assets as well as liability for business-related injuries.
[ ] Consider health & disability insurance for yourself and your employees.
[ ] Familiarize yourself with the general tax scheme for your business structure:
[ ] Familiarize yourself with common business deductions and depreciation.
[ ] Get the following information from the IRS:
[ ] Set up your books:
As you can see, starting a business involves making quite a few initial decisions and getting policies and paperwork in place. For more information about and help with starting a business, consult the following Nolo resources: Quicken Legal Business Pro.