Thinking About Starting a Small Business? Ten Key Components

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Don’t forget to contact your independent agent and learn more about Preferred Mutual’s business insurance.

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1. Business Plan

   Writing a business plan is essential when starting your own business and crucial for success. A business plan generally maps out the goals and projects for the next several years. Key parts of a business plan include an executive summary, a company description, a market analysis, organization and management, service or product lines, marketing and sales, funding requests, financial projections and an optional appendix. When writing your business plan, focus on what will make your company unique and stand out from your competition.

2. Location

   Determining your business location may be one of the most important decisions that you make when starting your own business. Consider researching the area’s demographics, proximity to suppliers, competition, safety and crime rate, zoning regulations, as well as local and state taxes. Also, take into account if the area aligns with your brand image and if there is room for future growth.

3. Financing

   Research and find available government-backed loans, venture capital and research grants to assist with starting your new business.

4. DBA Name

   A “doing business as,” or “DBA” name, is a business name that is different than your personal name, the names of your partners, or the officially registered name of your LLC or corporation. According to the U.S. Small Business Administration, the legal name of the business defaults to the name of the person or entity that owns the business, unless you choose to rename it and register it as a DBA name. Register your DBA at your county clerk’s office or with your state government; however, note that not all states require the registration of DBA names.

5. Federal Taxes

   Learn what your federal tax obligations are that you will pay to the IRS, which are determined by the form of business unit that you establish, such as a sole proprietorship, limited liability company, cooperative, corporation, partnership or S corporation.

6. State and Local Taxes

   Along with your federal taxes, you must pay state and local taxes, which vary by state. 

7. Business Licenses and Permits

   Obtain required federal, state and local permits licenses for your business. This article from the U.S. Small Business Administration is a good resource for anyone trying to find out what licenses or permits they might need for their business.

8. Local Assistance

   Locate your local Chamber of Commerce and learn about membership benefits, which may help with marketing and advertising your new business. Another great resource is your local U.S. Small Business Administration office, which provides free training and business assistance.

9. Employer Legal Responsibilities

   Before you hire your first employee, get an employer identification number, set up records of withholding taxes, verify any potential employee’s eligibility to work in the U.S., register with your state’s new hire reporting program, obtain workers’ compensation insurance, post all required notices, file your taxes, and set up payroll recordkeeping.

10. Business Insurance 

Contact your independent agent and learn more about Preferred Mutual’s business insurance, which can provide protection for your business’ building, contents, equipment and income, as well as extra expenses needed to get you back in business.

(Reference/Source: U.S. Small Business Administration)