Many people come to a point in their life, when they are ready to retire or make a career change. While this is an exciting time, it can also be extremely stressful, because there is always the difficult question that needs to be answered “What to do next.” Of course, most people have already decided to start a new business, which is always a great idea. Being your own boss is something that many people only get to dream of, but with the proper tools and information, you will be able to make your dream come true.
Now, one of the biggest decisions that you will need to make is whether or not you want a business that is small and sustainable or one that can be sold for a high profit at retirement age. The decision is yours to make, so do not take it lightly, because it could mean your financial independence, when you retire. Of course, you will probably want to go all out and start a business that will turn into a multi-million-dollar company, but there is always the question of a doable budget. If you are working with a large financial budget, then you will have this option. However, a small financial budget will not support such a goal.
Gather Legal Documents
Starting a new business not only requires making innumerable decisions, but also requires gathering the proper legal documents. There is no one that will know about the legalities of a startup than a business attorney. If you have any questions about launching a startup, business laws and legal documentation, you should seek the advice of an attorney.
Finding A Partner
It requires a lot of money to build a successful business. This is why many people will search for a suitable business partner, before they move too far into the process. Whether you are considering inviting a friend to partner with you or searching for someone with the same business interests, you will still need to do your research. Never just take someone’s word for it, instead play it safe and do your own homework. Do a background check, looking for previous and current business deals, financial status and credit history. You definitely do not want to get involved with someone that is not reputable, reliable or trustworthy.
It is crucial to find a partner that shares your motivation, enthusiasm and long-term goal interests. A compatible personality is also crucial, because you do not want to bump heads with your business partner on every turn.
An operational plan will play a huge role in how you will produce and deliver your service and products to the consumer. Creating this type of complex plan will not be simple, so you will probably need to hire an expert to prepare it for you.
Developing A Business Plan
At times, it may seem like the world’s biggest companies have sprung up out of nowhere overnight. This couldn’t be further from the truth. Wal-Mart and Amazon were not created in a day. These companies most likely all started with a solid business plan. Your plan should be thoroughly comprehensive and it should detail how you will create and run your business successfully for the long run. Once you’ve crafted a well-thought out business plan, you’ll have a much easier time obtaining funding and advice.
You’ll also have a much easier time identifying potential problems. Your plan can also be helpful for minimizing future legal problems. Last, but certainly not least, your business plan will provide you with a sound exit strategy. Make sure your business plan states how much of a risk or loss you’re willing to take before pulling the plug!
It is absolutely pertinent to realize that almost everything has been done at least once before. This is why trademarks have become so enormously important in the past few years. When attempting to launch a new business, it is absolutely imperative to make sure that your business does not infringe on another company’s trademarks in anyway whatsoever. Using another company’s name, slogan or logo could result in harsh penalties. Even if you do so without knowledge, your business could be punished and sued.
If you’re launching a company in the United States, you should refer to the United States Patent and Trademark Office. By doing so, you will be able to perform a search and analyze protected trademarks. Also, you should submit your trademark with the same entity. Before choosing a company name, it is a good idea to make sure it hasn’t already been trademarked.
After you’ve selected a name for your company, you’ll need to take steps to begin forming your company’s structure. The correct entity type for your business will depend on a handful of unique factors, including the number of owners and stakeholders. If you’re running a business on your own, you can form an LLC. If you’re working alongside another individual, such as a spouse or business partner, you might be better off with a partnership. Finally, if there are multiple shareholders, you should form a corporation.
Depending on the situation at hand, you’ll either need to prepare a partnership agreement or a shareholders’ agreement. The document will help to setup the arrangement between yourself and your business colleagues or shareholders. This will include information about the decision-making process and ownership rights.
Consider Getting An EIN
If you’ve ever worked for a big corporation, you’ve most likely received a W2 at the end of the year. On this document, you probably noticed that the company used a unique number to identify itself. This is referred to as the EIN or Employer Identification Number. This number can prove to be enormously important for businesses of all shapes and sizes. Even smaller businesses can benefit from an EIN, since it will give them the ability to use this number, while keeping their Social Security Number hidden. An EIN will also be immensely beneficial for better managing and tracking your company’s assets, expenses, revenue, and liabilities.
If you wish to open a separate bank account for business, you’ll need to obtain an EIN first. Again, this will prove to be very helpful for tax purposes at the end of the year.