Starting a new business isn’t exactly easy with everything you need to remember. Luckily you don’t have to go at it alone, below are startup tips to help during the registration process.
Formally registering a business has two major advantages, it increases the credibility of a business and it protects business owners from personal liability in the event a business is sued or found legally liable. But before you register an LLC in the U.S., it’s important to consider several factors and make a few very important decisions, some of which we’ve identified below.
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Finalize your chosen business idea and name
One of the first choices that potential business owners need to make is deciding what type of business they would like to start and what they would like to name it. It’s important to choose a business idea that suits your interest, your personal goals and even your natural abilities and talents. Choosing a business idea according to these guidelines will help you stay motivated and significantly improve your chances of success. It’s also important to choose a business idea that fills a need in the market or one that improves an existing product or service and your business name should also try to reflect this. This is the one way to ensure your business stands out among the hundreds of businesses just like the one you want to register.
Choose your business structure
Choosing the right business structure for your business idea is one of the biggest choices you will have to make before registration. Choosing between forming a sole proprietorship, an LLC, a corporation or even a non-profit is a difficult choice. Researching the different business structures is crucial to knowing which business structure will suit your business the best. Sole proprietorships are perfect for low-profit, low-risk business ideas, LLCs are perfectly suited for small businesses who want limited liability protection and favourable tax treatments, corporations are the better business structure if you’re looking to attract investors, and nonprofits are perfect for those hoping to further a social cause under the umbrella of an official organization. These are important things to know before you decide which business structure will best suit the type of business you want to start.
Select your business location
Every business needs a good location, but the perfect location is also dependent on the type of business you want to start. For example, retail businesses will look for a location that is well-populated and allows people easy access to the store while manufacturing businesses may need to find a location that reduces costs by being in close proximity to a steady labor supply, raw materials and transportation routes. A business that aims to provide niche products and services would need to be located where their competition is located to tap into and harness existing customers. A good location is crucial, one that is accessible but also has access to proper facilities, like parking structures, public transportation and most importantly, a healthy customer base. The location you choose must suit the type of business you want to start, and you should make the final decision well before you register your new business.
Find sources of capital and finance
Deciding how you are going to finance your business is also something you need to do before registering your new business. It’s important to make accurate estimations of the startup costs and the registration costs your business will likely incur. This includes the total cost of setting up and running your business until you’re able to draw a profit from the business. Finding sources of capital and determining your financing pattern is one of the last steps before you register your business.
What happens after registration?
After careful consideration of the choices that need to be made when registering a business, business owners must also give further consideration to decisions that need to be made after registration is completed. Such decisions include identifying your business’ competition and target market, its tax liabilities, the necessary permits and licenses, obtaining business and personal insurance, accounting and bookkeeping. It’s important to think about the future growth of a business and how these initial choices will impact the business in the long term.