Tips for Starting a Business

If you're looking for more independence and control over your career and work life, consider starting a business. Millions of Americans own small businesses, but it takes planning and hard work. Here are tips for starting a business.

Create a Business Plan

This is perhaps the most important step. A business plan will help you sort out all the challenges you'll face, and help you develop a plan to overcome them. If you're going to need to secure funding from a bank or other lender, a business plan will be required. It should include a description of the business, marketing plans, your competition, financial data on you and your business, a profit/loss analysis and more.

Location

The location of your business will be a big part of its success. This is true whether it's a storefront, a manufacturing facility, or home-based. Proximity to competitors, zoning laws, access to highways and the Interstate, foot traffic, there are many different factors that come into play. If your business plan is properly written, the ideal location for your business should be evident.

Financing

There are a variety of sources for financing. You can go to your bank, the Small Business Administration (SBA), or venture capitalists. Most major metro areas have groups of venture capitalists that hold monthly meetings to hear pitches from start up businesses.

Legal Structure

Another important step in starting a business is deciding whether or not you'll be a sole proprietorship, S corporation, limited liability corporation (LLC), partnership, non-profit or cooperative.  This will have a big impact on the taxes you pay, so give this a lot of thought.

Employer Responsibilities

If you plan on hiring people, you're going to have to become fully aware of laws on employees. As a start, you will need to become familiar with withholding taxes, Employee Eligibility Verification forms, your state's new hire reporting program, workers compensation, and more. Definitely consult with your tax advisor and attorney on these issues.