Many parts of starting a new company are exciting, but others can seem overwhelming and not fun at all. If you’re new to managing a business, you may not be aware of everything you need to do. Tackling your pre-opening checklist takes time, but it will result in a healthier business.
Choose Your Business Structure
All businesses need to select a structure before registering with government entities. A limited liability company is one of the most popular structures for small businesses. An LLC means less paperwork, tax advantages, and protection of your personal assets against business liabilities.
Discover the Benefits of an Operating Agreement
If you form an Ohio LLC, you’ll also need to develop an Ohio operating agreement. This document will be tailored for your business, but it should include detailed information in these categories:
- Capital contributions
- Management and voting
- Membership changes
You should complete this agreement as soon as you form the LLC. It will streamline beginning operations and be included in any funding applications.
Create a Realistic Budget
Cash flow during the beginning stages of a business can be sporadic and hard to predict, but you’ll need to establish a budget and stick to it. You should be able to estimate regular expenses, such as:
- Rent or lease payments
- Utilities, phone, and internet
- Employee expenses
- Advertising costs
- Supplies and inventory
- Delivery or shipping costs
- Bank fees
If you plan to borrow money for startup costs, make sure you ask for enough to cover your operating expenses for an initial period.
If you don’t have sufficient cash to purchase everything you’ll need, you’ll need to find startup funding. Prepare a thorough business plan before you apply for loans or grants. You might borrow money through:
- Commercial banks
- The Small Business Administration
- Family and friends
Many business owners use a business line of credit. This allows you to borrow money as you need it up to your loan limit.
Obtain Permits, State Tax ID and FEIN
You’ll need to register your new company with several government entities before opening for business. Check with your local and state governments to ensure that you obtain the necessary permits or licenses. You’ll probably need a state sales tax account, and you’ll have to get a federal Employer Identification Number.
Develop Your Marketing Plan
You’ll probably choose to advertise in multiple ways. A user-friendly website and social media posts are excellent marketing tools. You can also place ads in local newspapers. Identify your target audience and adapt your marketing strategy to reach those people for the best results.
Set Up Your Bookkeeping System
Keeping accurate books is vital to your company’s success. Record all transactions daily and reconcile monthly. Most companies use a software package that allows them to manage all their finances in one place. Many software options provide point-of-sale features, integrate with customer relationship management programs, and many crucial reports.
Get Ready to Process Payroll
Employers have to pay their workers and payroll taxes. Keep up with new legislation governing payroll, deductions, wage bases, and more. Choose payroll software that calculates paychecks and payroll taxes, can enable direct deposits, generates tax forms, and produces paystubs for employees.
It’s Not Fun, But You Have To Do It
Accomplishing the necessary but often frustrating tasks when opening a new business isn’t fun. List everything you’ll need to do, complete each item, and then enjoy launching your new enterprise.