08 Aug 2020
8 minutes read
Business Set-up 101: Where and How to Start?
Would you like to start your own business? But you don’t have any idea where and how to set-up a business?
Don’t worry, you are not alone. A lot of people who like to start their own business don’t really know where to start.
It may be from coming up and registering your business name to setting up your accounting system- there are a lot of steps associated with having your own business. And of course, you also need to have created a product/service idea.
It may be overwhelming. That’s why a lot of business never materialized because this business owner gets paralyzed and overwhelmed by all the procedures needed to open a business.
And for sure, you don’t want this to be your fate.
So, in this blog, you’ll find out more of the steps that will guide you as you set-up your own business.
Research is the first step when starting your own business. For sure, you might have a concept or idea in mind for your business. Now, is time to take some action and do some research.
One important area of your study is finding out if there is a market for your concept. You must be able to answer the question, “Do the consumers need my product/service?”
Remember that a business should be able to solve a problem faced by others. The more problem-specific you are, the better. It gives a clear perspective of what you’re offering and is, therefore easier to promote to customers.
Aside from having a great concept in mind, it’s best to put them on paper. So, the next step you need to take in developing your business plan.
A business plan is a log of all the objectives and strategies you have for your business. It is developed to guide you from the early stage up to the mature stages of your business.
These are the major components of a business:
You may need to conduct more studies and research to develop each section of your plan and business. If you’re unsure about financial projection, we recommend seeking the help of an accounting firm.
An important part of setting up a business is selecting an entity type. The entity type you select will have a great impact on your business in terms of tax filing and business liability.
These are the 5 main types you can choose from:
Choosing an entity type is a major and critical step in having your own business. Once you have selected the entity type that’s best for you, you’ll need to process the right paperwork with the state.
Just remember that as your business grows, things change, and you can update your entity structure.
Your business name is probably one of the most essential aspects of setting up your own business. You need to make sure that all implications of the name you select are considered, before moving forward with it.
Once you have the name, you need to be sure that it is not trademarked or being used by anyone. Then, you’ll need to register it.
An employer identification number (EIN), is a special 9-digit number that is given by the Internal Revenue Service to your business.
Applying for an EIN is needed if you don’t want reporting and filing to be registered under your social security number. You’ll also want to get one if you wanted to create a bank account and establish credit for your business.
Applying for EIN is free and easy. Log on to the IRS website to file a Form SS-4.
Whatever industry your business will be, you are required to file appropriate business permits or licenses.
You will need to check what licenses your business needs.
An accounting system is important for every kind of business. You will need these to successfully manage all of your transactions even before you start making sales.
It also helps you in decision making, filing taxes, setting prices, sending and receiving money, and staying within your financial capacity.
An accountant should be the one to set-up your accounting system for the best accuracy. When setting this up, you need to think about what type of software features you need.
Starting your own business is not an easy task but the steps are achievable. Once you are done with all of the steps stated above, you’ll be done with the vital areas needed.
Remember, certain steps may take some time like creating your business plan or setting up your accounting system. You’ll be successful as long as you are hardworking and consistent.
If you need any help in starting your business, don’t hesitate to let our team know. DD Business Analyst will be happy to assist you in making your idea into reality!
Contact Support@DDBusinessAnalyst.com to help your small business needs and Book 30min Free Consultation.