Once you’ve incorporated a business as a legal entity, written a business plan, and laid the groundwork to start selling to customers, it’s time to start thinking about the reality of how to operate a business. Think through the basics of your small business operations, everything from office space to finding advisers to hiring employees.
Small business success isn’t just about having a great business concept and having a lot of inspiration and passion (although these things are important). It’s also about doing all the “little things” right, day in and day out to operate a business , build strong customer relationships and keep your business thriving over time.
Getting Ready To Operate A Business
Here are a few steps on your journey to operate a business after starting a new one – and every step gets you closer to the first sale:
Outfit Your Business with Office Space, Equipment and Supplies
There’s an old saying in the real estate business: selling homes is all about “location, location, location.” Depending on the type of business you’re in, choosing the right location can make or break your business. If you run a retail business, being in the right location can make the difference between getting lots of foot traffic and plenty of spontaneous visits from new customers, or being overlooked.
Even for non-retail businesses, choosing the right location with well-outfitted office space can make an important difference in creating a comfortable, energizing work environment. After all, your office will be your “home away from home” as you launch your business. If you run a manufacturing business, now is the time to get your equipment in place and make arrangements with suppliers to ensure efficient ongoing operations.
Build Your “Outside Team” – Hire Good Help
Every business needs a team of trusted advisers to help negotiate the complicated details of legal compliance, taxes, accounting and other topics that are outside the business owner’s immediate expertise. Most companies, no matter how small, will be well-served by finding a good business attorney, a banker and an accountant.
Many entrepreneurs are confident, energetic and eager to learn – but the fact is, no matter how smart you are, you can’t be an expert in everything. Instead of taking time away from your business to sort out every last detail or accounting or legal compliance, you need to learn to delegate and get help when needed.
Your business lawyer can help offer legal advice and help you stay in compliance with regulations. Your business accountant can help you manage cash flow, read your balance sheet, make your estimated quarterly tax payments and file your tax returns. Forming a personal relationship with a business banker can help you get set up with bank accounts and get access to lines of credit as you continue to grow.
The best way to find expert business advisers is to ask for referrals from other small business owners. CorpNet™ can be an integral part of your “outside team.” We don’t offer tax prep help or legal advice – but we can serve as your “outsourced business filing team.”
Build your “Inside Team” – Hire Employees
Nothing gets done without employees. Hiring the right people, with the right pay and incentive structures, can help your business grow faster than you ever could have imagined. It’s best to start small and try to avoid hiring more employees until there is enough demand to cover the cost of the extra salaries. As part of hiring employees, you also need to create a day-to-day management plan and job descriptions to make sure you can keep your employees productive and motivated.
Learn the Rules – Educate yourself on Employment Laws and Regulations
Once you hire employees and officially become an “employer,” you are undertaking an obligation to comply with many employment laws and regulations, at both the state and federal levels. Unfortunately, many fast-growing business overlook the details of employment law – and they do so at their own peril.
Do yourself a favor and spend time with an employment law professional to understand your obligations as an employer in such areas as federal and state payroll and withholding taxes, self-employment taxes, anti-discrimination laws, OSHA regulations, unemployment insurance, workers’ compensation rules, wage and hour requirements, among others. You want to make sure you’re treating your employees fairly and complying with the law. Even a well-intentioned mistake or oversight can result in significant liability or fines for your company.
Get Business Licenses and Permits
Depending on the type of business you are operating, you may be required to obtain one or more business licenses and/or permits from the state, local (city and county) or even federal level.
Depending on the type of business and the laws of your jurisdiction, these can include, among others, a general business operation license, zoning and land use permits, sales tax license, health department permits, and occupational or professional licenses.
At CorpNet™, we can provide assistance in this area through our business license services. Read more about how CorpNet can help you get the right business licenses for your company.
Get a Tax ID Number
If you’re a sole proprietor or individual paying taxes, you can file taxes with your Social Security Number. But once you’ve incorporated as a corporation or LLC, and/or once you’ve hired employees, you need to apply for a federal Tax Identification Number. The tax ID number is also called an Employer Identification Number, or EIN. It is like a Social Security Number for your business and is used by the IRS to identify your business for tax matters. You may also need a similar ID number from your state. Obtaining Tax ID numbers is yet another area where CorpNet™ can help. Read more about how CorpNet can help you get a Tax Identification Number for your business.
Buy Business Insurance
Running a profitable business is not only a matter of earning revenue and paying bills – it also is important to protect yourself against catastrophic expenses. Carrying insurance for various aspects of your business can help you avoid the worst-case scenarios of running a business – for example, liability insurance can protect you in case of a lawsuit. Your specific needs for business insurance will vary depending on the type of business, availability of insurance, and your business’s specific risk factors. Consult with an insurance agent who understands your specific industry and who has sold insurance to other businesses in your field.
Prepare Your Marketing Materials
Now that all of your legal “ducks are in a row,” and you have an official licensed business with a unique (and/or trademarked) business name, you can check off the final item on our Countdown list and create marketing materials. High quality marketing materials – including a well-designed logo, website, stationery, business cards and marketing brochures – will help you project a professional image. You want customers to know that your business is a legitimate, credible “serious” organization. High quality marketing materials will help you put your best foot forward to make a strong first impression with customers.
Are you getting more excited to operate a business? Soon you’ll be ready to open and start helping customers. In the meantime, we’ve created a quiz to help you figure out the right business structure for your business. Take the quiz to find out now!
Planning Photo via Shutterstock