Taking the First Steps to Starting Your Own Business
Starting your own business begins with a few key decisions: your business structure, an EIN, a separate bank account and a plan for taxes. Getting them right early saves headaches later.
By the James Family Tax team
Every year, more and more people are choosing to leave corporate America in favor of starting their own small business. On top of being your own boss, you get to pursue your own vision, work your own hours, and enjoy a sense of fulfillment that you may not be able to find with traditional employment.
Of course, starting a small business can seem like a tall task — how do you even get started?
First and foremost, starting a small business begins with developing and understanding your vision. What are your goals and what do you hope to accomplish?
Many of us are driven by an inherent desire to make an impact in our community. It can be exciting, but before long you may experience self-doubt, feeling overwhelmed, or just plain unsure how to turn your vision into something tangible.
Fortunately, starting a small business is easier than many people might think. It requires a lot of planning, big decision-making, and research, but for those that are dedicated to pursuing their own ideas, forming a business is very achievable.
If you’re ready to turn your vision into a reality, take a look at these tips for getting your small business off the ground.
How to Start a Small Business
Once you have a clear vision for your business, it’s time to get to work on the steps you need to take to turn your idea into a reality.
This is where you’ll have to start making some pretty major decisions, but don’t worry, it’s not as intimidating as you might think. Just follow these steps to get started.
1. Research Your Idea
To determine whether or not there is a market for your idea, you need to start by performing thorough market research.
Once you identify a market, it’s important to learn as much about your audience as possible. Where do they live? What age group should you target? Do they shop for products/services online or in-store?
Answering questions like these will help you set up your business to appeal to your primary market.
This is also when you should identify your primary competition, and whether or not your business offers something that your competitors can’t.
2. Write a Business Plan
One of the most important first steps to starting a business is writing a thoughtful and detailed business plan.
A business plan serves as the foundation for your business. It should include things like:
● A company description
● An executive summary
● Your marketing plan
● Financial projections
● Funding requests
● Your products and/or services
● And more
This will serve as a roadmap for your business and will help you manage each stage of your company’s development.
If you need help understanding how to do this, the Small Business Administration offers a very detailed guide for writing a business plan.
3. Select a Business Structure
Choosing a legal business structure will impact your business taxes, the business registration process, and more, so be sure to familiarize yourself with the different business entities so that you can make an informed decision for your own business.
The most common business structures are:
● Limited Liability Company (LLC)
Because of the implications of this decision, we recommend consulting with a CPA or tax professional to help you determine which business structure makes the most sense for you.
4. Get Funding
Every new business needs funding to get off the ground, and your business plan should help you determine exactly how much you need to get started.
The good news is that there are plenty of ways you can secure funding for your new business venture, including:
● Self-funding
● Venture capitalists
● Crowdfunding
● Small business loans
Each of these offers specific advantages and disadvantages, so be sure to explore your options thoroughly to determine your best course of action.
5. Register Your Business
After choosing a business idea and name, creating a business plan, and selecting a business structure, registering your business is how you make it real. This will establish your business as a legal entity.
How you register your business will depend on your business structure and location; however, in most cases, it’s as simple as registering your business name with your local and state governments. You’ll also need to get federal and state tax ID numbers.
Visit the SBA website to find out your state’s business registration requirements.
6. Set Up Your Accounting Structure
Managing your company’s finances will be one of your most important responsibilities as a business owner, and to start, you need to establish an accounting structure.
This means you should open a business bank account to separate your personal and business finances, stay legally compliant, and to track income and expenses for tax purposes.
Additionally, you need to decide whether to handle bookkeeping yourself or hire a bookkeeping professional. When making this decision, keep in mind that, while your business’ finances may be simple enough in the beginning to manage on your own, you may need an accountant to help keep your finances in order as your business grows.
Get Help Starting Your Business
Starting a business can feel like a monumental task, but with the right guidance, this process can be quick, easy, and stress-free.
Some of the earliest decisions you have to make are also some of the most important, that’s why James Family Tax offers consulting services to help our valued clients set themselves up for success.
We’ll work with you to understand your vision, goals, and current needs to help you build a strong foundation for your business.
Contact James Family Tax to make an appointment and take the first step to turn your idea into a successful new business.
The information provided does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available for general informational purposes only. Information may not constitute the most up-to-date legal or other information. For more information consult with your attorney or tax advisor. No reader, user, or browser should act or refrain from acting on the basis of this information without first seeking legal advice or counsel in the relevant jurisdiction.
How James Family Tax Can Help
Ready to start or restructure your business? We handle LLC formation and help keep your entity active and in good standing.
Book an appointment at our San Antonio or Schertz office, or call (210) 864-1788.
Related reading: How to Check If Your LLC is Active in Texas: A Complete Guide for