How to Start Your Own Business
Being your own boss can be exhilarating and scary at the same time. You have no one to blame when things go wrong and only yourself to thank when things go right. Your business can be small and home-based, providing supplemental income, or it can generate enough income to support your family. Once you've decided on the type of business and your products, it's time to get going on how to start your own business.
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Instructions
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Develop a business plan for your business. The preparation of this document means you've looked at the market for your business, the competition, your customers, marketing strategies, goals, objectives and strategies and have completed a financial forecast for at least the first year of operation. You'll also know what start-up funding is required and for what uses.
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Establish a legal entity for the business. Depending on your circumstances, you might want to keep the business as a sole proprietor, limited liability company (LLC), C corporation or S corporation. Ask your accountant and attorney which format works best for your circumstances.
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Register the business and obtain licenses. States differ regarding what they require and the fees charged. The type of business also affects what licenses or permits you need. For example, if you decide to open a catering business, you need an inspection permit for your kitchen, food handler's license, sales privilege license to collect sales tax and possible special permits for garbage disposal. Contact the state's business development office to find out what's required. Call the city business development office where your business is located to determine its requirements.
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Set up a bookkeeping system and checking account. A small business may only need to use an Excel spreadsheet to track sales and expenses, while a more complicated business may need a more involved accounting system. If you're unfamiliar with accounting, consider adding the services of an accountant, at least on a quarterly basis, to assist you. Separate business expenses from personal and household expenses. Pay business expenses from your business checking account. Keep sales revenues, including cash sales, separate from your personal financial accounts.
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Lease space for the business if that's appropriate and necessary. If it's a home business, designate an area in your home as an office. With laptops and Wi-Fi, it's tempting to work anywhere and everywhere, but that may be inefficient. Gather all your business supplies, materials, records and correspondence in one place. It also gives you a psychological advantage to set up a home office. When you're there, you'll know you should be working, not cruising forums or checking email or Facebook.
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Tips & Warnings
Go back to your business plan every month. Determine what worked and what didn't, and adjust your plan for future months.
The income from even a small home-based business has to be included in your tax statements.
