10 Steps to Starting A Business

Mon, March 01, 2021 09:45 AM Comment(s) By Infamous Moot

The Back Alley Guide to Business

There will never be a right time to start a business. If you really want to start a business all you need to do is follow these 10 steps.

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Step 1: Prepare your mind.

When it comes down to deciding if you’re ready to start a business, it’s more about mindset than timing. The reality is saying you’re going to start a business is easy. But doing it, turning nothing into something that makes money, that can be a whole lot tougher. When starting a business you must prepare yourself to do all the work, all of the time at first. So let's prepare your mind.

You don't need to know every thing you just need the basics. You don't need to be an accountant to handle your own bookkeeping you just need to know how to pay bills, because here's the thing you will either be paying someone for something or they will be paying you for something.

Understand that you will be creating a living entity and as such it's like a child. A child needs nourishments, a child needs to be taught, and a child needs to be protected. Your business will be the new child in your life. You also must realize that yes you are starting your own business, but a new business like a child requires a lot of time to grow. You will put in a lot of time with little to no pay in the beginning. But you have to keep going to achieve the victory that you want. Once you tell yourself you are ready to start a business, there's no reason to wait. Time to get started right now. Your mind is made up and this is what you want so let's go.

Step 2: Determine what type of business to start.

Now that you have decided to start a business the next step in the process is know what type of business you want to start. Are you going to provide a service or services, are you going to sell a product or products, or are you going to do both. Let's go threw both. Services are one of the easiest business to start because this type of business is based on your know how. You will be getting paid from your time and efforts. What do you know how to do, what can you teach the next person, How can you help solve a problem. Products on the other hand requires products, now you need something to sell. What can I sell? Buying products to resell is the normal in product sales, however you can create your own product if you have any idea's of something to create. Once you have decided weather you want to provide services or sell products or even both, you business has now been conceived. It's time to come to the realization that you are starting a business, your are about become a business owner. Oh yeah.

Step 3: Decide if you really want to do this.

Alright Alright, your mind is made up and you have decided what type of business you want to start. At this point you have not done any work you can really decide if this is the path for you. Are you willing to put in the time to start and run this new business. If your answer is still yes. What type of business have you decided to start Services, Products, or Both.

Does the services you will be providing is it a need for your services do you have the skill and know how to provide those services, when can you start providing these services and solving problems of others.

Does the products you want to sell, are they created by you or are you going to buy and resell. How soon can you get or make these products.

If you have made it to this point and you are still in the mindset to start your own business than, here is where the real fun begins.

Step 4: Decide your business name

Now let's create the business shall we. Now you need a business name. Sometime creating a business name can be harder than it sounds, the easiest way is to keep it simple, try not to over due it. Here are a few tips. If you are doing more than one type of business or planning on doing more than one type of business, choose a suitable name for the entire business not just one part. Example, if you are going to be doing plumbing, "Joe's Plumbing" is a good name, that's a niche service and you are only providing one type service. If you will be providing more than one service, like plumbing and home improvements, "Joe's Home Repair" or "Joe's Home Improvement" would be a more suitable name for your business. Either way you can name your business anything you want. Once you have you business name you are well on your way.

Step 5: What structure type of business to create

Of all the decisions you make when starting a business, probably the most important one relating to taxes is the type of legal structure you select for your company. Not only will this decision have an impact on how much you pay in taxes, but it will affect the amount of paperwork your business is required to do, the personal liability you face and your ability to raise money:

Sole Proprietor

A sole proprietor is someone who owns an unincorporated business by himself or herself. However, if you are the sole member of a domestic limited liability company (LLC), you are not a sole proprietor if you elect to treat the LLC as a corporation. This structure of business you will be using your Social Security Number, so you and your business are one in the same.

Partnership

A partnership is the relationship between two or more people to do trade or business. Each person contributes money, property, labor or skill, and shares in the profits and losses of the business.

Corporation

In forming a corporation, prospective shareholders exchange money, property, or both, for the corporation's capital stock. A corporation generally takes the same deductions as a sole proprietorship to figure its taxable income. A corporation can also take special deductions. For federal income tax purposes, a C corporation is recognized as a separate taxpaying entity. A corporation conducts business, realizes net income or loss, pays taxes and distributes profits to shareholders.

S Corporations

S corporations are corporations that elect to pass corporate income, losses, deductions, and credits through to their shareholders for federal tax purposes. Shareholders of S corporations report the flow-through of income and losses on their personal tax returns and are assessed tax at their individual income tax rates. This allows S corporations to avoid double taxation on the corporate income. S corporations are responsible for tax on certain built-in gains and passive income at the entity level.

Limited Liability Company (LLC)

A Limited Liability Company (LLC) is a business structure allowed by state statute. Each state may use different regulations, you should check with your state if you are interested in starting a Limited Liability Company. Owners of an LLC are called members. Most states do not restrict ownership, so members may include individuals, corporations, other LLCs and foreign entities. There is no maximum number of members. Most states also permit “single-member” LLCs, those having only one owner.

For a More in-depth understanding of the structure of businesses check out theses links below:

Step 6: Choose a business location (Home or Office)

Now that your business structure has been decided now you need a location of the business. Will you be preforming you business from home or are you opting in for a small office outside of the home. Home offices are the least expensive option because the overhead on you business space will be your rent. However if you can afford a office space and that is what you choose to do then have at it. But these days a home office is suitable for what ever you are trying to do. Either way you will need a location for the next step.

Step 7: File Paper work to start business

Now that you are in the mindset and you know what type of business you want to start, you have decided the structure of you business and have a location. Now you need to register and activate your business name. There is a fee for registration.

Registration of your business name takes place in your state, through your state's business division (usually part of the Secretary of State or State Department). Registration is not the same as trademarking your business name, which is done through the U.S. Patent and Trademark Office.

You may not legally use your business name without first registering it as one of the many business entities recognized by your state and the IRS. … To avoid the extra time and expense of trying to register your business on your own, use an online business registration firm.

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Step 8: Contact IRS for Employer Identification Number (EIN)

Now that your business name has been register, Like any new born baby that enters the world they need a social security number. A new business needs the same thing. But with a business it is not a social security number. For a business it is called an EIN (Employer Identification number). Right after you register your name you are to apply for this EIN number from the IRS. This number separates your Social Security Number from the business making you two different entities. Don't worry this will be FREE. Yes it does not cost anything to get a EIN. Click here for an EIN

Step 9: Open up a business bank account (Checking's & Savings)

OK now your business name has been register, you have your EIN number. Now it time to give your business a frame. This frame will be your new business bank accounts, you will need a business checking account and business savings account. Your business needs it own money, so when money is coming in and going out it will not be coming from your family and personal money. Maybe in the beginning you will be using your own money but soon after the business should be running on it own strength. Any bank that you like should be sufficient as long as it is in the business name. To open up a business account you will need the business address, business name registration paperwork and the EIN number from the IRS. Once your account is open for your business you have done it. You have officially started a business, you are now a business owner. Congratulations.

Step 10: Business Equipment/Licenses/Tools

Now that your business has be started, your next step is to give it some abilities to work. Now come the Equipment, Licenses, and Tools. This will be the physical part of your business, and without the equipment, licenses and tools it will be very hard to succeed in your new journey. So here is what you need.

Equipment: This is the list of starter equipment you need to run your business:

A Desk,
A Computer,
A Printer,
High Speed Internet,
A Cellphone

Licenses: Depend on what services you decided to offer and what products you decided to sell you may need a license to provide the services and sell those product. Example: if you are providing accountant services you may need a CPA Certification to prove that you know what you are doing, or if your are opening up a daycare you may need a childcare license. Depending on what service you are providing, just do a little research to be sure, you may or may not need it depending on the services your providing. Selling product you may need a license to sell product usually called a sales tax license. You get this from your states sale tax department.

Tools: Once again depending on your business will be how to determine what tools are needed. But every business needs bookkeeping software to manage the finances of the business. If you need some bookkeeping software, Zoho Books seem to be a great business software easy, inexpensive and very powerful. click here to check it out.

And there it is, after completing all 10 of these steps you have officially and legally started your own business you are now a business owner. Starting and running a business does not have to be so hard especially when you have help and a support system to be there when you need them. Strickly Bizzness, LLC offers IT Support, Business support, and Virtual Assistants to those who need a helping hand. Contact us to see what we can do for you. Request Form