Good morning, readers and future entrepreneurs.
I know what you are feeling. I want to be able to help others create, run, and succeed. As a professional, I’ve learned there are many steps to take in order for a small business to be opened and operated. Here are some questions that I hope aspiring entrepreneurs will find helpful. Many questions can arise when opening a small business. I’ll briefly address some of them in the following list.
Which type of business would you like to start?
Entrepreneurs can get involved in many business ventures. It all boils down to the knowledge or willingness to acquire it. Are you a restaurateur? Repairman? Plumber? Do you offer home health or assistance? Are you familiar with managing and working in such establishments? Are you able to receive formal education from an institution? Are you a sole proprietor or a member of a partnership? Look into limited liability companies (LLCs), in addition to sole proprietorships or partnerships. S corporations may be another option. However, they are only for businesses with stockholders and may not work for your business.
What permits and licenses are needed?
Every business has its own licensing requirements. It all depends on what the entrepreneur chooses to do. Restaurants would require food safety licensing along with essential business licensing. If alcohol is served, an additional permit would be needed for the entrepreneur to legally sell alcohol on the premises. Businesses that are repair-oriented would require at least a business license. However, if they also sell parts, they will need to list “retail” on their business license. For health care services, you need to have at least a formal education and be licensed as an LPN, RN, or other related permits. To ensure that your business is legally allowed to operate, make sure you check the laws in your state.
What education, certifications, and training are necessary to legally operate this business?
This was covered in licensing and permits. However, there are many more requirements than that. One cannot run a vehicle collision repair shop without having the necessary knowledge. You can attend schools to learn how to operate almost any type of business. There are businesses that can work without any formal education, such as those in lawn care and housekeeping. There are also certifications that can be obtained for training in almost all care industries if they exist at all.
Is this business going to need a storefront?
A storefront is a must for retail establishments. Remember that retail companies will require a more significant initial investment than service-based operations. The inventory is the initial investment. Service businesses might not require a physical storefront in order to be able to provide their services. However, most of the work could be done on-site. If you need a storefront, make sure to look into delivery options or on-site services if possible.
What will it cost?
The cost of a license and/or permit will depend on what type of business you have. This number can be as low as $200 for a license or right, but it could go up to a million dollars for larger businesses. Inventory is expensive, as well as specialized tools that allow for precise work. Calculate opening costs and operating expenses. Calculate the size of the storefront required (if applicable), as well as research local commercial realty locations, prices, and prices. Although it is cheaper to rent short-term, the idea of owning property that has been paid off is appealing. The cost of most things will depend on where you live. If your business requires employees, this is another expense. Employees are more expensive than sole proprietors and partnerships. This is why you need to add unemployment insurance to your business. Ask your chosen insurance company about the types of coverage that are required and whether it is possible to offer health insurance. These employees will need to pay taxes on their wages. This is part of the employee’s salary and part of the company. If you don’t have enough capital to start your business, repayments of loans could be a cost. You should not forget about basic operating expenses like heating/cooling, Internet connectivity, and utilities. In comparison to physical stores, on-site services are much cheaper.
What can an individual do to pay for it?
Applying for loans is an option if you don’t have enough funds. Make sure you have a business plan that includes projected revenues and expenses. There are many other options to raise funds for your business. Look into grants. Although grants aren’t very common, they can be a source of assistance. You could receive donations from others if many people believe in your dreams.
Accounting?
Bookkeeping is a necessity – research which accounting/bookkeeping software would work best for the type of business you are planning. Point-of-sale systems (POS) are required for selling goods or inventory to customers. POS systems track sales, taxes, labor costs, employee labor, and other details. You may be able, depending on the business model of your company, to track your inventory using spreadsheets if you’re proficient at creating them.
