Before opening up your small business, get set up for success by reviewing these three essential steps that will set the foundation for a successful business.
Starting a business is both an exciting and overwhelming time — you’re making your dreams of entrepreneurship come true, but there are many steps to consider on the path to success. Once you’ve secured your business financing, take a look at these essential steps to opening a business, and check off each one as you work toward your launch day.
Step 1 to Starting a Business: Complete Required Filings and Licenses
Few business owners are passionate about filing paperwork — if you are, more power to you — but it’s a step all entrepreneurs must take in order to successfully launch their business and to avoid headaches down the road.
State Fees and Administrative Requirements
Every state has different requirements for business owners, and they go well beyond the initial filing of your corporation. These requirements are some of the easiest to miss when you’re excited about starting your business but can cause some of the biggest problems if not completed properly. For example, some states require you to publish your articles of incorporation in a local newspaper, and almost all states require the filing of an annual report. If these steps aren’t completed, you’ll typically be notified in the form of fines owed to the state.
Becoming a business owner by means of opening a franchise is an exciting path to entrepreneurship. One of the wonderful benefits of franchising is that it puts you on the fast track to success, and one of the challenges is that there’s often heavy lifting upfront to meet the franchisor’s requirements. Beyond meeting your franchisor’s expectations, there are also requirements to fulfill with your state. New franchise owners often overlook that states have their own required filings and associated fees. For example, franchise owners in California need to pay $700 to the state soon after filing their corporation.
Depending on your industry, you may need to obtain one or more specialized business licenses from the federal government before opening your doors. Transportation, broadcasting and alcoholic beverages are just a few of the industries that fall into these federally regulated industries. The Small Business Administration (SBA) has an extensive list of regulated industries that also includes the organization that issues the license for each. Many businesses that perform personal services such as doctors, dentists, hair salons and veterinarians must have up-to-date professional licenses. If you’re unsure about whether or not your business requires a license, check with your Secretary of State or the SBA.
Step 2 to Opening a Business: Set Up Essential Business Services
It can feel discouraging to start paying other businesses before you’ve opened the door to your own business. And as an entrepreneur, you’re likely someone who can get things done yourself. However, it’s crucial to keep your focus on running your new business and delegate some tasks to trusted industry professionals.
For many first-time business owners, payroll seems like a “future problem” to address once operations are underway and you’re starting to bring on more staff members. However, many business owners forget that they are their business’s first employee. So, if you’re paying yourself, you will want a great payroll system in place. As soon as your first employee is on the books, there are taxes due to the IRS in the form of federal income tax, employment tax, Medicare and Social Security tax. In 2016, employment tax errors led to over $6 million in fines for American business owners — all avoidable if you partner with a trusted payroll provider.
Bookkeeping and Taxes
For obvious reasons, keeping track of your business’s cash flow is extremely important when running a successful operation. But as obvious as the need for good bookkeeping may be, it’s easier said than done. Investing early in a reliable, user-friendly bookkeeping program like Intuit’s QuickBooks, makes managing your business’s finances simple and straightforward, even for the accounting adverse. Also, because QuickBooks is now available online, it’s very affordable, you never have to purchase software updates and the information can be automatically synced with additional Intuit products, like TurboTax.
Third-party 401(k) Plan Administration
If you used 401(k) business financing to fund your business, you’ll be required to sponsor a 401(k) plan — a huge benefit to both you and your future employees. However, an important factor in remaining in good standing with the IRS is proper maintenance of the 401(k) plan and completing the annual filings. Working with an experienced third-party Plan Administration team is integral to completing these steps successfully each year. While IRS and DOL requirements are complex, working with a trusted provider allows you to reclaim your time as an entrepreneur and focus on running your business.
Step 3 to Opening a Business: Create a Marketing Plan and Online Presence
Many entrepreneurs view executing the marketing plan as one of the more fun parts of starting a business. After all, you’re excited about your new business, and marketing means getting to share that excitement with the world. Fortunately, early-stage marketing efforts can also have a significant impact on your business’s long-term success.
Google My Business
The importance of having a strong online presence cannot be overstated. As you build marketing buzz, your potential customers need to be able to find you online or they’ll quickly discredit you. Even if you haven’t yet built our your website, you can easily register for Google My Business so that you appear as a verified business in a Google search. Then, customers can easily find either your physical location, website or both, as well as a summary of your business, hours, etc. This is a free service offered by Google, and there are several helpful articles online about how to optimize the setup of your business.
Professional Email Domain
Nothing is more frustrating to customers today than not being able to reach a company online. Even if they’re reaching out about something benign or a non-issue, it can quickly become a (very public) problem if they can’t easily contact you and receive a quick response. One of your earliest steps should be to set up a professional email address you can give to customers. Fortunately, most webhosting sites include an email address (or several) as a part of their service, so you should easily be able to create an email that looks like [your name/info]@[yourbusiness].com.
Social Media Accounts
Another way customers love to interact with businesses is though social media accounts. This can sound intimidating, but even if you choose just one social media platform (and use it well), it can have a positive impact on your business. Having a well run social account has incredible benefits — you can let customers get to know you before opening your doors, it bolsters your online presence, let’s your business take on a personality and can greatly impact the size of your potential customer market. If you’re new to social media, a quick Google search on best practices will reveal a lot of great info specific to your type of business, target audience and general how-tos.
There’s more than one way to find success as a business owner, but taking the time to lay a solid foundation for your business can and will make your life easier as an entrepreneur. Make sure to complete all of the items noted here before opening your doors so you can focus your time and energy on what you’re passionate about.