Analysis

How to Start Your Own Business

Starting your own business seems to be so challenging and impossibly difficult. In fact, it actually is, but getting a certain action plan will make that more clear and possible.

Some tasks like naming the business, creating a logo is the obvious step, but what about the less-indicated, equivalently important steps? 

1.Indicate your particular idea

It is essential to do a research of an existing company you’re planning to be in the market with. That will form a general sense of it and probably you can notice some missing points you can add to your business to make it more unique. 

If you’re obsessed with a certain company, find information if it has an option to open a franchise of it.

2.Write a business plan

In simple terms, a business plan is the written description of your company’s future. You need to clarify what you want to do, what your target customers are and how you’re planning to achieve it.

Typically, these plans outline the first 3 to 5 years of your business strategy.

3.Get finances to fund your business

Writing a business plan will give you the possibility to approximately calculate how much money you need. One of the main reasons why many startups fail is that they run out of money before turning a profit. It’s always a good idea to overestimate the amount of startup capital you need, as it can take a long time before the business begins to bring in sustainable revenue. 

4.Choose a business structures 

The legal structure of your business can impact everything starting from your taxes to what you’re liable for.

-Sole proprietorship 

A sole proprietorship, also known as a sole tradership, individual entrepreneurship or proprietorship, is a type of enterprise owned and run by one person.

-Partnership 

A partnership is a form of business where two or more people share ownership, as well as the responsibility for managing the company and the income or losses the business generates.

-Limited liability company

A limited liability company (LLC) is the US-specific form of a private limited company. It is a business structure that can combine the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation.

-Corporation 

A corporation is a business entity that is owned by its shareholder(s), who elect a board of directors to oversee the organization’s activities. The corporation is liable for the actions and finances of the business – the shareholders are not.

5.Get Federal and State Tax ID Numbers

A federal tax ID, also called an employer identification number (EIN), is required to apply for a business bank account or loan.

In fact not all companies need it. 

You can determine if you need one.

– Your business has any employees except of you 

– Your business is incorporated

– You have any partners 

– You take over a business, that existing before either through purchase or inheritance

– You have a retirement plan for self-employed individuals or solo 401k retirement plan

– You want to open a bank account 

– You file for bankruptcy

In case you have one option fits your company than you have to get federal tax ID.

A state tax ID has the same system but  is assigned by your state.

6.Get business insurance 

It’s critically important to protect your business and your personal assets. There are different types of business insurance. The decision which one you need will depend on the industry you’re in.

7.Create your team 

If you’re the only employee in your company it will definitely change one day. You have to be determined what people you need, not only about their professionalism. 

8.Promote your business 

If you prepare everything perfectly before launching your business it won’t make any sense without its promotion. You definitely need a website and social media to make your company known. That also affects your company’s perception. And certainly it will help grow your business. 

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