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Evaluate and Develop Your Business Idea

Ste Description


Determine if the type of business suits you.

Start the Right New Business

for You.

Use a break-even analysis to determine if your idea can make money.

Will My Business Make Money?

Write a business plan, including a profit/loss forecast and a cash flow


Writing Effective Business Plans

Find sources of start-up financing.

Business Financing, Loans &


Set up a basic marketing plan.

Marketing & Advertising

Decide on a Legal Structure for Your Business


Identify the number of owners of your business.

Partnership Information

Decide how much protection from personal liability you'll need, which
depends on your business's risks.

What are the risks of starting

my own business?

Decide how you'd like the business to be taxed.

Business Tax Information

Consider whether your business would benefit from being able to sell stock. Incorporate Your Business


Research the various types of ownership structures.

Sole Proprietorship
C Corporation
S Corporation


Get more in-depth information from a self-help resource before you settle
on a structure. If you are unsure, talk to a lawyer.

Nolo Store
Talk to a Lawyer

Choose a Name for Your Business


Think of several business names that might suit your company and its
products or services.

Your Business Name


If you will do business online, check if your proposed business names are
available as domain names.

Choose and Register a Domain



Check with your county clerk's office to see whether your proposed names
are on the list of fictitious or assumed business names in your county.

Your Business Name


For corporations and LLCs: check the availability of your proposed names
with the Secretary of State or other corporate filing office.

Register Your Business Name


Do a federal or state trademark search of the proposed names still on your

list. If a proposed name is being used as a trademark, eliminate it if your
use of the name would confuse customers or if the name is already

How to Do a Trademark Search


Choose between the proposed names that are still on your list.

Choosing a Business Name FAQ

Register Your Business Name


Register your business name with your county clerk as a fictitious or

assumed business name, if necessary.

Register Your Business Name


Register your business name as a federal or state trademark if you'll do

business regionally or nationally and will use your business name to

File a Federal Trademark


identify a product or service.


Register your business name as a domain name if you'll use the name as a
Web address too.

Choose and Register a Business


Prepare Organizational Paperwork



Partnership Agreement
Buyout agreement (also known
as a buy-sell agreement)



Articles of Organization
Operating Agreement
Buyout Agreement (also known
as a buy-sell agreement)


C Corporation

Pre-Incorporation Agreement
Articles of Incorporation
Corporate Bylaws
Buyout Agreement (also known
as a buy-sell agreement or
stock agreement)


S Corporation

Articles of Incorporation
Corporate Bylaws
Buyout Agreement (also known
as a buy-sell agreement or
stock agreement)
File IRS Form 2553, Election by
a Small Business Corporation

by: Beth Laurence, J.D.

Find a Business Location

Ste Description



Identify the features and fixtures your business will need.

Your Business Space &

Commercial Lease.


Determine how much rent you can afford.

Tips for Assessing the

Cost of the Commercial


Decide what neighborhood would be best for your business and find out what the Determine the Space Your
average rents are in those neighborhoods.
Business Needs.


Make sure any space you're considering is or can be properly zoned for your
Avoid Zoning Trouble
business. (If working from home, make sure your business activities won't violate
any zoning restrictions on home offices.)


Before signing a commercial lease, examine it carefully and negotiate the best

Commercial Leases:
Negotiate the Best Terms

File for License and Permits


Obtain a federal employment identification number by filing IRS Form SS-4

(unless you are a sole proprietorship or single-member limited liability company
without employees).

Licenses & Permits for

Your Business


Obtain a seller's permit from your state if you will sell retail goods.

State Start-Up

Requirements for Small


Obtain state licenses, such as specialized vocation-related licenses or

environmental permits, if necessary.


Obtain a local tax registration certificate, a.k.a. business license.


Obtain local permits, if required, such as a conditional use permit or zoning


Local Start-Up
Requirements for Small

Obtain Insurance

Determine what business property requires coverage.

Obtaining Business


Contact an insurance agent or broker to answer questions and give you policy


Obtain liability insurance on vehicles used in your business, including personal

cars of employees used for business.


Obtain liability insurance for your premises if customers or clients will be visiting.


Obtain product liability insurance if you will manufacture hazardous products.


If you will be working from your home, make sure your homeowner's insurance
Home Business Insurance
covers damage to or theft of your business assets as well as liability for businessrelated injuries.


Consider health & disability insurance for yourself and your employees.

The Employer's Legal


Set Up Your Books


Decide whether to use the cash or accrual system of accounting.


Choose a fiscal year if your natural business cycle does not follow the calendar
year (if your business qualifies).


Set up a recordkeeping system for all payments to and from your business.


Consider hiring a bookkeeper or accountant to help you get set up.


Purchase small business accounting software

Cash vs. Accrual


Bookkeeping and
Accounting Basics

Set Up Tax Reporting


Familiarize yourself with the general tax scheme for your business structure.

Tax Savvy for Small



Familiarize yourself with common business deductions and depreciation.

Deduct It! Lower Your

Small Business Taxes


Obtain IRS Publications 334, Tax Guide for Small Business, and 583,Taxpayers
Starting a Business.

Small Business Tax FAQ


Obtain the IRS's Tax Calendar for Small Businesses.

IRS's Tax Calendar

1. Sole trader or limited company?

Which you choose will impact on the tax you pay and how much legal and
financial responsibility is laid at your door. As a sole trader you take all the posttax profits but you are also liable for all of your business' financial dealings. For a
guide on the pros and cons of each, click here.
2. Size up the competition

Who else is doing what you're planning to do? How well do they do it? By studying
the competition you can learn from others' mistakes - or even what their customers
appreciate. Learn how much people are willing to pay for your product or service
and how you could enhance the current offerings.
If one big player dominates the market space, focus on what they don't do well or
who they don't cater for; provide a superior service and you could grab a share of
their space. Alternatively, if the market is fragmented, there could be an
opportunity to launch a brand that becomes the de facto choice for consumers.
3. Define your target audience

Appealing to everyone appeals to no one. You need to focus on your target

audience and style everything from your website to your marketing campaigns
around them. Make sure you are targeting the right people by sending out
questionnaires, speaking to your customers through social media and holding
focus groups. The only way to provide a product or service people really want is
to get inside their heads. Involve your target customer in the development of your
business and continue to test, test, test. Consulting your customers will also
make them feel like they have a voice, will breed loyalty and, if you're lucky, will
increase the likelihood of them recommending you to others.

4. Paying yourself
How will you pay yourself? You need to think about this up front. With the best
intentions of ploughing profits straight back into the business, you're going to
have to eat, drink and put a roof over your head. Cut back on the luxuries but
figure out what you do need to live on and include it in your outgoings. The bank

or any investors would much rather see this than you going back cap-in-hand six
months after you told them your business plan made sense.
5. Your business name

Think long and hard about your name: you're going to be stuck with it as
rebrands are expensive and painful. It'll need to work with an available web
domain and will also often be the first thing prospective customers see. Consider
what your name needs to say about your business. Should it simply be a case of
'says what it does on the tin' or communicate aspects of your brand identity, such
as Innocent Drinks, or perhaps geography is important if you're focused on
serving or representing a local area - Manchester Landscaping Ltd or Premium
Lincolnshire Sausages Ltd, for instance.
6. How you'll get your name out there

No point having an amazing business idea if nobody knows about it - so how will
you get your name out there? Without a big marketing budget, start small and
focus on building relationships. Use social media and network hard to start
building a reputation with not just potential customers, but also local journalists,
suppliers, fellow retailers, local business organisations. Start a blog, be active on
Facebook and Twitter, offer to write articles or talk for free on your expert subject,
get people trying and reviewing your product or service, think about having a
launch party. For tons more low cost marketing tips click here.
7. Your web presence

Did you know that 50% of small business don't have a website? Most want one,
but they either think they can't afford one or don't have the skills to put it together
themselves. The latter may have been true a few years ago, but web building
tools such as Moonfruit - available as part of Smarta Business Builder - mean
absolute beginners can now get a fully e-commerce website up and running in no
time. You might not need to sell online though, perhaps a simple brochure site
showcasing what you do would be enough - but, then again, wouldn't it be nice to
take bookings? Start thinking about how much more business you could be doing

by embracing an online market - then explore the available options to make it

8. Your USP

Customers will only stop buying from other businesses in favour of yours if you
offer something better or different. Your USP(unique sales proposition) defines
what is special about your offering; what customers can't get elsewhere.
Carefully sculpt your USP: perhaps it's your product if it is genuinely unique, or
maybe it's about customer experience; after-sales support; the way you price or
offer payment; or that everything you do is organic. Maybe, like Tom's Shoes,
which donates footwear to Africa for every sale made, you appeal to consumers'
growing demand for ethical trading. Find your angle then make sure everything
you do is true to it.
9. Funding

In an ideal world you would have enough money to self-fund the launch of your
new business. But, for the majority, that's not an option. Instead you can ask
friends or family if they may be willing to help or you can look into getting a bank
loan or seek out an investor. You should also look into what business grants are
available: they're hard to come by but brilliant if you manage to get one. If you
can't secure the funding you need to launch your master plan, start small and
prove the business works - then go back to the bank or investors with more
10. Find an accountant

is much more than just a bean-counter. They should be a valuable

and trusted source of financial and business advice. Usually armed with many
years' experience they can help you steer the company away from danger and
advise you when and where to save your money. Seek a local accountant with
experience in your sector who'll see you as a big enough client not to just pass
An accountant

you onto a junior. Ensure you can afford to pay for help like this by not frittering
away money getting them to sort out your shoebox of bills and invoices.
11. Write a business plan

Business plans rock - really! Don't view them as a chore you must do for the
bank or an investor - use this as a chance to prove to yourself that every aspect
of your business plan and model works and makes sense. If it doesn't, do you
really want to go ahead? The LivePlan software in Smarta Business Builder takes
you step-by-step through every process of putting together a business plan, from
the executive summary to the cash forecasting.

12. Route to market

This one's really simple - how will you sell to your customers? What's your route
to market? Consider all your options, from market stall to eBay shop to mail order,
to retail unit or concession, to picking up business at networking events and on
social media to telesales or integrated partnerships or simply via Google
Adwords. Where will your business come from? Where's the obvious place to
start? You can't possibly write a business plan until you've worked out your
platforms and route to market and how much each will cost you.

13. Potential partners

Who could you benefit from working with? Forming a relationship with a business in
another sector could help you tap into a whole new customer base. For example,
if you're a florists you could find a wedding planner and supply flowers for them at
a discount. You'll get access to their customers and you can recommend people
to them too. It's beneficial for both parties. Find someone to share half the
workload and you'll move twice as fast.
14. Licensing and legal issues

When launching a business you should speak to the local authority to find out
whether you need any special licenses to sell in your area. For example, if you
are selling alcohol or food you need a license. If you fail to produce one, you'll be

fined and could ultimately be closed down. There are a host of other legal
obligations to consider and it's best to get at least one session of legal advice.
You should also ensure processes - from sales to supplier agreements and terms
and conditions - are legal binding and contracted up. Smarta Business
Builder provides access to a library of legal contracts written by award winning
solicitors that can personalised to your business.
15. Find the best business bank account

You'll need a business bank account - but don't just go straight to the bank you've
used as a consumer. Find one that understands your business and who you feel
comfortable with. Most banks also offer incentives for new sign-up.
16. Staffing requirements

Will you need employees from day one? If not, how about day 100? You need a
plan for this so you're organised, prepared and resourced for whenever - if ever that day is. Employing someone is a big commitment to the individual but also to
your bottom line. Don't jump into it and be clear before making any appointment
exactly what that person will do and what added revenue they will bring to the
business: it's usually an equation that results in a quick rethink! If you can, utilise
freelancers and look what you can outsource.
17. Insurance

You are required by law to have employers' liability insurance if you have any staff
and public liability insurance if you expect to welcome customers or suppliers
onto your premises. You must also insure any vehicle you use. If you sell
products explore if you need product liability insurance.
It can be expensive, but think if your business could survive should the
unthinkable happen and your premises, equipment or stock was stolen or

for the best deal and ask your bank for any deals that may come as
part of your account. Premiums are increasingly annually, so research ways you
can keep quotes low.
Shop around

18. Skills gaps, experience and training

Just because you've eaten in a lot of restaurants it doesn't mean you'd know how
to run one - a fairly obvious statement numerous wannabe restaurateurs have
ignored to their peril. So even though you may have a killer business idea you
need to work out if you have the experience and skills to execute it. If you
haven't, look into training, evening classes and even think about getting a job in
the industry first to pick up that valuable insider knowledge.
19. Technology

Audit your business plan to figure out what technology will enable you do five
things: save time, save money, stay in control, make more sales and deliver a
better service to your customers.
There are a host of apps and some brilliant mobile technology out there to
consider - and Smarta Business Builder is designed at helping you with the first
three in order to let you focus on the other two.
Create a business plan, build a website, manage your accounts, access legal
documents and your email all in one place - keeping you super organised and in
Use the spare time to get closer to your customers on social media.
20. Mentors

There's nothing better than having an experienced business mentor to turn to for
guidance - or simply to bounce ideas off. Someone who has been there and
done it and knows what you're going through will be invaluable. Is there a
business guru in your circle of friends? If not target people you admire, seek
recommendations from people within your industry or consider government-

backed mentoring schemes. The Prince's Trust can put you in touch with a business
mentor if you are aged 14-30.
21. When to start (and give up your day job)

You're ready to launch your business but don't rush to quit the day job - the
salary could be useful in the short-term. It could pay to start piecing together your
business out-of-office hours and then make the leap once your business can
sustain you and is truly ready for your full-time attention.

10 Steps to Starting a Business

Starting a business involves planning, making key financial decisions and completing a series of legal activities.
These 10 easy steps can help you plan, prepare and manage your business. Click on the links to learn more.

Step 1: Write a Business Plan

Use these tools and resources to create a business plan. This written guide will help you map out how you will start
and run your business successfully.

Step 2: Get Business Assistance and Training

Take advantage of free training and counseling services, from preparing a business plan and securing financing, to
expanding or relocating a business.

Step 3: Choose a Business Location

Get advice on how to select a customer-friendly location and comply with zoning laws.

Step 4: Finance Your Business

Find government backed loans, venture capital and research grants to help you get started.

Step 5: Determine the Legal Structure of Your Business

Decide which form of ownership is best for you: sole proprietorship, partnership, Limited Liability Company (LLC),
corporation, S corporation, nonprofit or cooperative.

Step 6: Register a Business Name ("Doing Business As")

Register your business name with your state government.

Step 7: Get a Tax Identification Number

Learn which tax identification number you'll need to obtain from the IRS and your state revenue agency.

Step 8: Register for State and Local Taxes

Register with your state to obtain a tax identification number, workers' compensation, unemployment and disability

Step 9: Obtain Business Licenses and Permits

Get a list of federal, state and local licenses and permits required for your business.

Step 10: Understand Employer Responsibilities

Learn the legal steps you need to take to hire employees.

Steps involved in starting business in India

Registration Requirements:


Time to complete:

Cost to co

Obtain director identification number (DIN) online


from the Ministry of Corporate Affairs portal

1 day

INR 100

3 days

INR 1,500

2 days

INR 500

1 day

INR 1,300 (I


Obtain digital signature certificate online from


private agency authorized by the Ministry of

Corporate Affairs (National)

Reserve the company name online with the

Registrar of Companies (ROC) (National)

Stamp the company documents at the State

Treasury (State) or authorized bank (Private)

1,000 for AO

of share ca

100 for stam

Form 1)

Get the Certificate of Incorporation from the


Registrar of Companies, Ministry of Corporate

5 days

INR 14,133

Affairs (National)

INR 350 (co


Make a seal (Private)

1 day

number of

time period

Obtain a Permanent Account Number (PAN) from

an authorized franchise or agent appointed by the

National Securities Depository Ltd. (NSDL) or the

Unit Trust of India (UTI) Investors Services Ltd., as

7 days

12.36% ser


outsourced by the Income Tax Department


Obtain a Tax Account Number (TAN) for income


taxes deducted at source from the Assessing

7 days

Office in the Mumbai Income Tax Department




Register with the Office of Inspector, Shops, and

Establishment Act (State/Municipal)

Register for Value-Added Tax (VAT) at the

Commercial Tax Office (State)

Register for Profession Tax at the Profession Tax

Office (State)


12.36% ser

INR 6,500 (I
2 days


12 days

2 days

INR 5,100 (r

+ stamp du

No cost


Register with Employees Provident Fund

Organization (National)

12 days

No cost

9 days

No cost

Register for medical insurance at the regional


office of the Employees State Insurance

Corporation (National)