With the job market taking a nosedive, this could be the moment where you decide to take the leap of faith and start your own business.
About 20% of all new businesses close within the first year. This is a tough reality, but many people don’t understand what it really takes to open their business on the right foot.
A simple starting a new business checklist will help you get your business going, and you’ll make sure that you have all of the most important details covered.
Read on to discover the steps you need to take when you start your new business.
- Business Plan
There is a bit of a debate in the business community as to whether this is necessary or not, but you should consider two things.
The first is that if you need startup financing for your venture, a business plan is a must. No one will consider you for a loan or investment based on your idea alone. You have to show that there’s a market there and you know what the risks are in starting your business.
The second reason why a business plan is important is that businesses that have a formal plan are 16% more likely to be successful. Your business becomes the book that guides you through important decisions when you start your business.
For example, you know that your target audience is made up of young families with an average household income. When it comes time to choose your location, you know that opening up in the middle of a retirement community wouldn’t help you reach your audience.
- Team of Experts
There are dozens of other decisions you’re going to have to make. Some of these decisions will affect your business for years, and making the wrong decision can be costly to your business.
There are tax and legal implications that you’re unlikely to know unless you’re an accountant or attorney. That’s why you want to get a team of experts on board with your business right at the beginning.
- Choose the Business Structure
One of the reasons why an attorney can be useful is that they will help you choose the right business structure for your business. There are several ways to structure your business, but the most common ones for new businesses are sole-proprietorships and LLCs.
A sole proprietor is a one-person show, but they can form single-member LLCs. You can choose this route to protect your personal assets from any liability claims against your business. As a sole-proprietor, you and your business are the same things.
You’re still taxed the same, where you file a 1040 and report your business income and expenses on Form Schedule C. The advantage here is the legal protections that come with an LLC.
- Register the Business
The next step is to register the business with your local and state entities. These are usually easy to do and inexpensive. If you register your business as an LLC, you’ll need to have an operating agreement and articles of organization.
The requirements will vary from state to state. You can have your attorney assist you in creating these documents and filing the paperwork for you.
A sole-proprietorship usually just requires the application form and fee. Again, that will vary from state to state.
- Select a Business Location
Do you plan to have a physical location for your business? You want to make sure that the rent is within your budget and balance that with being in a convenient spot for your target audience.
A downtown location may be appealing because it’s centrally located, but you’re going to pay a lot for that space. Another consideration for your location is parking. People may be reluctant to drive if they know that parking is hard to come by and then have to pay for it.
What if you don’t have a physical location? Then you need to build your online store. You have to purchase a domain name for your business and set up the website. You can do that on your own or by hiring a web designer.
- Business Insurance
One item you can’t afford to overlook when starting a new business is insurance. You could be held responsible for professional negligence or if someone trips at your place of business.
Even if you start your business by working in your home, you’ll need to have business insurance. Your homeowner’s or renter’s policy won’t cover you for any business-related issues.
Commercial insurance brokers should be contacted so you have complete insurance coverage for your business. They can tell you if you need cyber liability insurance or income insurance on top of a general liability policy.
- Develop Systems to Serve Customers
As you get ready to open your doors for business, you want to have certain systems in place. This is essential to maximize your time.
You can have a system in place that allows customers to book appointments online. You can then have an automated system that follows up with them and asks for feedback.
You should have systems in place for every part of your business, from managing financials to paying invoices. Putting these things in place early will make it easier to scale your business.
Starting a New Business Checklist
You want to start a business, but when you know all of the things that need to happen, it can be daunting. A simple starting a new business checklist can help you put all of the pieces together before you open your doors.
You don’t want to overlook anything on this list because it could lead to a very expensive issue down the road. The best thing you can do is start with a business plan and a team of people who can guide you through major decisions.
For more ways to build a thriving business, click on the Business tab at the top of this site.