How to Start a Company

By Friday, October 21, 2016 0 No tags Permalink

Our world is more connected today than ever before in history. Something that happens on the other side of the globe can be viewed instantly in just seconds, and communication methods are becoming more and more effective. This makes it an exciting time for anyone with an entrepreneurial spirit.

As exciting as the climate is, it’s important for those ready to get their feet wet in the world of business to take a step back and ensure they are taking each step cautiously. Quick decisions can be detrimental, and there are some important steps to follow to best ensure you’re starting a business the most efficient way possible.

Write a Business Plan

Sometimes businesses make themselves. However, for most of us, it requires vision and planning to create one that will stand the test of time. A good business plan prepares you for the future long after the excitement of the initial startup fades and you’re faced with increased responsibilities. Online business incorporation companies can help with the needed forms. There are a few key questions a good business plan answers including:

  • How will you win your fair share of the market?

  • Who will be in charge of running the company?

  • What are the financials requirements and risks?

  • Why is your idea to present your product or service to the market an exciting and unique one?

Understand Types of Business Structures and Choose the Best One for You

As a business owner, there are certain obligations you’ll assume depending on the type of structure you decide to form your business on. There are several from which to choose, and this requires you to take your time and research. Some of these include:

  • Sole-proprietorship- not a legal entity and typically refers to a person running a business who is responsible for debts

  • Partnership- two or more people share ownership and are both responsible for profits and losses

  • S Corporation- taxed under Subchapter S of Chapter 1 of the Internal Revenue Code

  • C Corporation- taxed separately from its owners.

  • Limited liability company- provides limited liability to its owners.

What’s the Difference Between an LLC and Partnership?

Corporations offer their owners a number of benefits. From protection of assets and easy access to capital to anonymity, perpetual existence and so much more, it’s clear to see the desire to choose this business structure. However, it’s important to understand that partnerships and sole proprietorships do not fall under the “corporation” category. While these options offer benefits such as the ease in starting and the ability to count business profits as personal income, they also hold a much higher liability in the event things go wrong.

Is Creating an LLC the Right Step for My Business?

There are several types of corporations. However, the LLC remains one of the most popular in that what it has to offer for business owners is worth the investment in time and money it takes in creating an LLC. If you’re considering this type of business structure, there are a few things you should ask yourself before making such an important decision for the future of your company. A few of these include:

  • Are all partners on board with the idea?

  • Who are my members and shareholders?

  • What steps need to be taken in order to handle my business license?

  • What is my business plan for my investors?

  • In what ways will we be able to save money on taxes?

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