Small businesses are a vital part of the economy. Owning a business takes long hours, hard work, and dedication. While local businesses are often referred to as “Mom & Pop,” they are usually a collaboration of children, brothers and sisters, aunts, uncles, friends, neighbors. These entrepreneurs work tirelessly to create successful local businesses, that not only put food on their own table, but act to stimulate the local economy so we can all “bring home the bacon”.
In fact, this day is all about celebrating just how fantastic small businesses are for our local economy. If you haven’t heard the many reasons to “shop small” or “buy local”, we highly recommend checking out this Huffington Post infographic. It’s not just the next coolest thing to do, there are valid reasons!
So, in the spirit of entrepreneurship, we thought we would spend our time today educating YOU just how to start a small business. Because what is stopping you from really considering that big idea brewing on your back burner for quite some time now? Many have missed their opportunity waiting for the stars to align.
If you need a little inspiration, read 3 quick stories on how these entrepreneurs got started. Otherwise, read on!
9 steps to starting your own business
- Write a business plan. Map out how you will start your business, and make turn it into a successful company. A business plan includes a description of the company and the product or service, along with an executive summary, market research, marketing plans, and a funding request. Check out these guidelines to get started.
- Utilize business assistance and training. Find free training and counseling services that help you prepare a business plan, secure financing, and expand your business. Check out FrugalEntrepreneur.com for more than 30 resources that offer free online business courses.
- Choose a business location. If you need a physical location to set up your business there are a number of factors to keep in mind
- Demographics- consider the customers you are looking to attract and what areas they frequent
- Foot traffic- will if bring in business?
- Accessibility- how close is the building from the street?
- Parking- how much is need and how much is available?
- Competitors in the area
- History of the site
- Ordinances you need to follow
- The building’s infrastructure
- The cost of utilities and other fees
- If your business is more virtual and you can start your business from home you may have more of an advantage to save money with startup costs. You can also write off a position of your rent/mortgage if you are operating a home-based business. Talk with your tax professional about this, and if you don’t have one, we highly recommend getting one if you want to start a business!
- Secure financing. There are a number of options you can utilize when it comes to financing your business and getting it up and running. Work to find government backed loans, small business loans, or venture capital and research grants. Or get creative and try crowdfunding on a site like Kickstarter, which can be a fun and successful way to raise money at a low cost. Attract an angel investor using these simple tools.
- Determine the legal structure. Decide what kind of ownership works best for you and your business – sole proprietorship, partnership, Limited Liability Company (LLC), corporation, S corporation, nonprofit or cooperative. Look into every type of business entity and learn about the obligations that go with each.
- Set up a business name. Once you decide on the name of your business, you need to register it with your state government by filing a DBA (Doing Business As). Your business name will be automatically registered with the state if you form an LLC or corporation. And, if you want to protect the name and brand in every state, apply for a trademark with the U.S. Patent and Trademark Office. Learn how to register your business name.
- Register for State and Local Taxes. Register with your state to receive a tax identification number, workers’ compensation, unemployment and disability insurance. Learn more about your tax obligations.
- Acquire Business Licenses and Permits. To run your business, you must first obtain federal, state, and local licenses and permits. Understand the requirements for small businesses and learn more about them here.
- Hire Employees. If you come to the point when your business has grown to more than a one-person company, then check out these eight steps to hiring your first employee and ensure you follow federal and state regulations. Also, make sure to learn about and understand the OSH law, which requires employers to provide a safe workplace for their employees. Learn more about employer responsibilities here.
Starting your own business can seem daunting, however just take your time, follow the steps, seek a mentor, and utilize the multitude of information published for entrepreneurs like yourself. When looking to take the next step and start your own business, read about loving your job and becoming an entrepreneur.
How will you celebrate and support local businesses in your community? Comment below and share with friends. Get everyone involved in this great day!