Did you know that there are around 30.2 million small businesses in the United States? While there are millions of small businesses, only 50 percent of them will survive the first five years of being in business.
If you are thinking about starting a small business, you need to make sure you set it up for success. If you don’t, you could struggle to grow your business, waste time, and get in legal trouble.
Are you looking for a business startup checklist? If so, keep reading to learn everything you need to know about being a small business owner.
Choose a Business Idea
If you want to start a business, the first step is to come up with a business idea that you are passionate about, is profitable, and has demand. One of the best ways to test your business idea is to conduct a SWOT analysis.
SWOT stands for strengths, weaknesses, opportunities, and threats. Doing this type of analysis before you start your business can help you understand if your business opportunities have the potential to grow.
In addition to analyzing your idea, you also should start thinking about a business name, brand, and goals.
Make a Business Plan
Once you have a good idea, the next step is to make a business plan. A business plan is a formal document where you write out your ideas, goals, and business structure.
A good business plan should include a mission statement, financial plan, marketing plan, operations plan, and a timeline for reaching your goals. If you are selling products, consider adding sales incentive programs.
Most business investors will want to see a business plan before providing funding, so make sure you include all the details.
Choose a Business Structure
Before starting your business, you need to choose the right legal structure. Your business structure will determine how you pay taxes and who is liable for the business.
Some of the most common business structures include sole proprietorships, partnerships, limited-liability corporations, and S corporations. Each type has pros and cons, and the right type will depend on your preferences.
Take Care of Finances
Depending on the type of business structure you use, you may need to apply for a Federal Employer Identification Number (FEIN). This will allow you to pay taxes, pay employees, and open a business bank account.
If you are running a sole proprietorship under your name, you may be able to use your social security number. Once you know which number to use, you need to open a business bank account.
Having a business bank account will allow you to separate your personal and business finances. If you need to get business funding, you should start comparing your options.
Are You Ready to Use This Business Startup Checklist?
While starting a business is hard work, it is easier if you follow this business startup checklist. When starting your business, make sure you have a good idea, a business plan, and choose the right structure.
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