1. ESTABLISH A BUSINESS ENTITY & PLAN

Do you want to start a small business or online business but unsure where to begin? Does the thought of the process overwhelm you? If you answered yes, then this informational course is for you. There is a ton of information available online on how to get a small business started, but too much information could be what is causing you to feel overwhelmed. Information overload can make you feel like you must use every piece of information that you have learned and if you don’t use it all then you must be doing it wrong.

You have learned about all these different strategies, but you have no plan of organizing or executing the information. Use this strategy plan to get your small business to grow to heights you never thought imaginable. Following these steps allowed me to immediately start doing business online, and on the first day of my website launch I had new e-mail subscribers all around the world, wanting to stay updated on everything about my new business. It felt so amazing to view my website analytics and see live sessions in different states, & other countries. This was after just one week of being open for business. So, if you follow this simple strategy plan, you will be running your own business in no time.

The first step of this strategy is determining your reason for starting your business. Are you starting your business to make extra money on the side? Are you starting your business to replace a 9 to 5? You may even be starting your business for the passion of your niche, and you are not concerned about the money stream. You may have an idea so big that you can see it being a multi-million-dollar company someday. Your reason for starting your business plays a major role in how your business will be ran, and how much energy you should put into it. Some people refer to this as determining your, “why”.

No matter what reason you have for starting your business, formatting a business plan is very important. It goes along with your reason for starting your business. Business plans are very useful in keeping our business organized. Business plans are also important if you are looking for an investor, a partner, or a business loan. Most commercial rental properties also require a physical copy of your business plan if you plan to rent a storefront. Can you start a business without a business plan? Of course, you can, however your business reflects your planning.

If you don't have a business plan in place, it may be difficult when obstacles arise in your daily business operations. A business plan provides a plan of action for you to run your business effectively. Having a business plan is very helpful for you, the owner as well. Any issues that you may come across, whether it is financial, or customer service related should be in your business plan for you to refer to. Many aspiring business owners view business plans as a daunting task, but they are easier to format than most people think. There are two different types of business plans that you can consider for your small business. You may choose to draft a traditional business plan or, a quick plan. This goes back to your reason for starting your business. 

If you are looking for investors the best type of plan to write is a traditional business plan. These are usually more detailed, and extensive. If you are using your plan to guide your own focus in your business a quick one-page plan will do if it contains, the key elements needed to run your business. If you don’t know where to begin with writing your business plan, there are free templates available online to help you properly format your business plan. Choosing a liable source for your template is very important to ensure that your business plan is formatted properly and not missing any valuable information. The Small Business Administration has a sample available for download on their government website.

The next step would be to decide how you want to classify your business. Learning the laws regarding your small business is very important. There are several types of business entities. They include Sole Proprietorships, Limited Liability Companies, S-corporations, C-corporations, and Partnerships. Your business entity determines how you will file your taxes. Sole Proprietorships, and Limited Liability Companies are the two business entities you should consider when starting a small business. Sole Proprietors file their business taxes on their personal taxes as self-employed. If you establish your business as a sole proprietorship, you are liable for everything personally. Therefore, any lawsuits, or fines will be against you personally. Sole proprietorships are good for small businesses just starting up because the cost to register your business is very low in comparison to other business entities.

An advantage of being a sole proprietor is all your business earnings go directly to you as your salary. You can always redetermine your entity once your business blooms. One of the most common business entities is a limited liability company, better known as an LLC. However, the laws regarding an LLC do vary by state. An LLC is structured to protect its owners from personal damage.

An individual owner can be considered an LLC as well, because there is no maximum or minimum number of LLC members. This is referred to as a single-member LLC. The costs for an LLC are much higher than a sole proprietorship. There is an initial fee, as well as annual fees. If you are a single-member LLC, you are also taxed the same as a sole proprietorship. If your LLC includes more than one member, it will be taxed the same as a partnership. You do have the option to request to be taxed as a corporation as well.

One key difference in a single-member LLC and a Sole Proprietorship is your salary. In an LLC you must write a check to withdraw profits from the business account for personal use. This is known as an “owner’s draw”. However, you are not considered and employee.