Starting a new business can be an exciting but challenging endeavor. Here are some general steps to help you get started.
- Develop a business plan: A business plan is a roadmap for your business that outlines your goals, target market, competition, marketing strategy, financial projections, and other essential details. A solid business plan can help you secure funding, identify potential challenges, and stay on track as you grow.
- Choose a legal structure: Your legal structure will impact your taxes, liability, and management structure. Common legal structures include sole proprietorship, partnership, LLC, and corporation. Consult with a business attorney or tax professional to determine which structure is right for your business.
- Register your business: You’ll need to register your business with your state and obtain any necessary licenses and permits to operate legally. You may also need to register for taxes and obtain an employer identification number (EIN).
- Secure funding: Starting a business requires capital, whether it’s through personal savings, loans, or investors. Explore your funding options and develop a financial plan to ensure you have the resources to get started and sustain your business.
- Set up your business infrastructure: This includes setting up a business bank account, developing a brand identity, creating a website, and establishing your office or workspace.
- Hire employees or contractors: Depending on your business, you may need to hire employees or contractors to help you run your business. Be sure to
- comply with all employment laws and regulations.
- Launch your business: Once you have all the pieces in place, it’s time to launch your business. This may involve a grand opening event, a social media campaign, or other marketing efforts to get the word out.
Starting a business takes time, effort, and resources, but with careful planning and execution, you can turn your entrepreneurial dreams into reality.
Related: Social Media Marketing Is Essential For Local Businesses. Here’s Why.
Related: Different Types of Logos (and How To Choose the Right Logo)
LLCs and S-Corporations have different advantages. You can find what is best for your new business in this article.
If you decide an LLC is best, use these steps to form your limited liability company (LLC). It’s a straightforward process.
- Choose a name for your LLC: Choose a name that is unique, easy to remember, and compliant with your state’s LLC naming rules. You can check with your state’s Secretary of State office to ensure that the name is available and not already in use. Use ZenBusiness to help you form your LLC.
- File Articles of Organization: You’ll need to file Articles of Organization with your state’s Secretary of State office. This document typically includes your LLC’s name, business purpose, registered agent information, and management structure. There may be a fee associated with filing the Articles of Organization.
- Draft an Operating Agreement: An operating agreement outlines the ownership structure and operating procedures for your LLC. While not all states require an operating agreement, it is recommended that you create one to avoid misunderstandings and conflicts with your business partners.
- Obtain any necessary licenses and permits: Depending on the nature of your business, you may need to obtain certain licenses and permits from your state or local government. Check with your state’s licensing agency to determine what licenses and permits you need.
- Apply for an Employer Identification Number (EIN): An EIN is a unique nine-digit number that identifies your business for tax purposes.
- Open a business bank account: Separating your personal and business finances is important for tax purposes and liability protection. You can open a business bank account once you have your EIN.
- Maintain compliance: LLCs are required to file annual reports and pay fees to maintain compliance with their state’s regulations. Check with your state’s Secretary of State office for specific requirements.
It is recommended that you consult with an attorney or accountant who is familiar with LLC formation in your state to ensure that you are following all the necessary legal and tax requirements.
Related: Form a Florida LLC
Advantages of a limited liability company over an S-corporation.
Limited liability companies (LLCs) and S-corporations (S-corps) are both popular types of business entities, each with its own advantages and disadvantages. Here are some benefits of an LLC over an S-corp:
- Simpler Management: LLCs offer more flexibility and simplicity in management structure, which can be an advantage for small businesses. Unlike S-corps, LLCs do not require a board of directors or shareholders meeting, making it easier for owners to make decisions.
- Fewer Formalities: LLCs have fewer formalities to follow than S-corps. For example, LLCs don’t need to hold annual meetings or keep minutes of those meetings, whereas S-corps are required.
- No Shareholder Limit: LLCs can have unlimited owners, while S-corps have a limit of 100 shareholders.
- Flexible Taxation: LLCs have a more flexible tax structure than S-corps. LLC owners can be taxed as a sole proprietorship, partnership, S-corp, or C-corp. This allows owners to choose the tax structure that best suits their needs.
- Limited Liability Protection: Like S-corps, LLCs offer limited liability protection to their owners, meaning that personal assets are generally protected from business debts and lawsuits.
It’s important to note that each business is unique, and the advantages of an LLC or S-corp will depend on your specific circumstances. Consulting with a business attorney, tax professional, or ZenBusiness can help determine which entity is best for your business.