I've been reading a lot and taking a lot of courses lately and frankly you all are out here paying people for things you can do yourself. We all want to know how to properly start a business, how to get funding, are there grant funds for for-profits, and how to establish business credit. Well guess what! You have come to the right place. Your favorite consultant will drop some major nuggets Ta-Day!
Let's start with properly starting a business. For starters, let's do away with not getting an EIN. However, that's not where we start which is where a lot of people go wrong. You can start with the EIN if you are a sole proprietor, but if you are planning on becoming any other type of entity which I strongly recommend, you need an EIN. Some of you are like what is an EIN (employer identification number) aka Tax Id Number.
Nevertheless, the first step is actually having a plan. When we say take a leap of faith we don't mean start the business with no plan, no vision, on a hope and a prayer. Write the vision and make it plain. If need help with writing a business plan there are lots of resources that we will gladly share. In your planning process come up with a name for the business, decide what entity type your business will be, research that industry, find your competitors, find out about licensing and permits then move on to the next step.
Step two is registering your business with the state you will be operating in. But what if I want to operate in multiple states then you will file as a foreign entity in those states you would like to operate in under the same name and EIN. As for a partnership, you do not have to register with the state but you absolutely need to obtain an EIN and create an operating agreement or joint venture agreement. Yes you need this agreement in place even if it is your spouse. There's a lot more funding, especially now, for women and minority owned businesses be sure to capitalize on that by have ownership percentages correct and your paperwork organized properly. Hint Hint...husband and wife! Wife should own 51% of the business. Which takes us to step three.
Step three is obtaining an EIN (employer identification number) retrieved from the IRS website free of charge. Say what! Free! Yes free! So why do people, consultants, businesses charge you to obtain an EIN? Uh well because we are doing the work and you are not. Therefore, jot down this knowledge or utilize other free resources out there without spending unnecessary money. Wow Jen Jen! You are bold isn't this the business you are in? I am and while I must make a living to help support my family I am also out her to help others attain their goals. And quite frankly if sharing information about a free EIN hurts my business well I might be in the wrong business LOL! Now on to step four.
Step four is obtaining a D-U-N-S. Obtain a what? Oh girl! You and all these acronyms! Relax! A D-U-N-S is a Dun & Bradstreet Number that you can also obtain for free from their website. Why do I need this number? You need this number to start establishing business credit. While, I want to tell you what I know about building business credit, I don't want to bore you to death so honestly you'll have to check the next blog for that because this one it a lot longer than I planned on.
Step five is getting the proper licenses and permits to run your business. And well these aren't free by any means. Most licenses and permits are obtained from the county or city you are operating in but some industries require licensing and permits from the county, city, and state but you will already know that because you did that research in step one right!
Step six. I won't call this the last step because honestly there is no last step when it comes to starting and running a business. But this definitely gets you off to a great start. There is so much more, for example, website, contracts, policies and procedures, record keeping, software, etc. Ok. Off on my tangent again. Step six is opening a business bank account. I recommend credit unions but if you have been banking with the same bank for a long time you may want to use them and that is perfectly fine.
Well, we are off to a great start. I know I said that already but we are. My apologies we only went over one of the above mention subjects, but take what you've learned here and apply it. By the time you get started we'll talk again. If you would like to talk specifically and in detail head over to our website bandhbusinesssolutions.com and schedule a consultation. We are here to serve. Also, be on the look out for our upcoming webinars. Catch them early while they are free because once they aren't, they aren't. One more thing, like and follow us on IG, FB, and Tik Tok @bhbsfirm
Until next time!
-Your Favorite Consultant