Start Your Next Business: 20 Essential Steps

While there might be hundreds of things you consider before starting a business, some of the decisions you will make are much more important than others. When preparing to get your next venture up and running, be sure to take some time to think about these 20 aspects of developing your new company.

1) Create a formal business plan – Without an organized and comprehensive business plan your company’s operations will not be as focused as they could be. This often leads to a difficult time securing investors or outside financing.

2) Decide on the most beneficial business structure for your company –Different corporate structures offer different benefits to business owners, while also dictating different requirements.  Be sure you choose the most beneficial structure for you and your business.

3) Incorporate or form your business or LLC – Once you have decided on which structure is right for you, file the necessary forms to incorporate or form your business.

4) Acquire your company’s federal tax ID number, and if applicable, state tax ID number – A federal tax identification number (commonly known as an EIN), is mandatory for any business, and necessary for a variety of other tax and financial purposes.

5) Claim all domain names and social media handles you may want to use – Maintaining a strong web presence is important in the modern business environment.  Be sure to claim any domain names or social media handles you will need to market your business online.

6) Find and hire relevant business professionals – Having a team of reliable and skilled professionals (such as an accountant) can help you organize and manage your financial resources.

7) Research and obtain any and all necessary business licenses and permits – In order to operate your business in accordance with federal, state, and local laws, you will need to make sure that you apply (and pay for) all licenses and permits relevant to your company.

8) Open your business bank account(s) – Your business will need to have a dedicated bank account.  This is important for any business, no matter how small it might be. Most of the steps of setting up a business or incorporating require you to have a dedicated business account.

9) Acquire business credit cards – Using credit cards for your company’s payment needs is a great way to establish credit early on, and keep track of your cash outflows. Just be sure that you are not spending more than you can afford to pay back quickly. Spend time researching the best interest rate and cardholder benefits (such as cash back or air miles).

10) Develop an efficient accounting system – A mismanagement of financial resources is one of the most common reasons a business fails, especially new small organizations.  Whether you hire an accountant or are using small business accounting software, be sure to keep a close on eye every dollar.

11) Research and purchase any mandatory insurance – Depending on your industry, there may be mandatory types of insurance that your business will have to maintain.  Be sure to research which types you will be required to have, along with the best rates.

12) Focus on establishing your credit - For a majority of new businesses, maintaining a strong liquid cash flow can be difficult.  By establishing credit with your suppliers, it will be much easier to make sure that all of your bills are being paid on time, as you will be able to avoid prepaying for goods and services.

13) Research and conform to all federal, local, and state regulations – There are several governing bodies (OSHA, the Department of Health, etc.) that exist to make sure that your business is operating to code.  Make sure you understand which organizations will be monitoring your company, and then make sure that you are in compliance with their rules and regulations.

14) Choose your business’s location – The location of your business depends upon the type of company you have. If your clients or customers will need to visit your office, it is important to find an accessible location.  If not, your decision will likely be based purely on financial and zoning factors.

15) Develop and standardize internal documents – No matter what type of business you will be running, there will likely be a long list of documents and forms you will be using on a regular basis.  Be sure to develop these beforehand, to save yourself time and effort after opening.

16) Create your website – Now that the Internet is far and away the most widely used information source among all types of customers, it is integral that your company has a website.  Either look to template driven options that you can create yourself, or locate a reliable and skilled web development agency.

17) Write and implement a formal marketing plan – The most important resource for a business is a steady stream of new clients or customers.  While it will likely change often, it is important that you have a plan in place that addresses client acquisition.  

18) Develop your online presence – Add content to your social media profiles, register your business on any relevant online directories, and use these tools to communicate with potential customers.  The importance of the Internet for businesses cannot be understated. Have a plan to manage online contact with current customers when your business is up and running.

19) Research and join any beneficial industry organizations – Depending on your industry, there are more than likely organizations you can join that will increase your credibility, provide useful networking opportunities, and pass on useful information regarding insider industry trends.  If you qualify and can afford the necessary fees and dues, it may be well worth joining these types of organizations.

20) Recognize and study your competition – Many new entrepreneurs often underestimate the competitive nature of business.  It is always important to identify your main competitors and research their business practices.