If you are thinking about starting a new business, you need to know three things. Do these things and your business will run smoothly. Forget them, and you will have trouble down the line.
Register your business name.
This will be called a DBA (doing business as).
The reasons for this are two fold.
· When you generate money, you will have to report it to the federal government (Internal Revenue Service) and in some cases the state and local governments. The DBA is how you separate your regular income from your business income.
· The other reason is to make sure no one else is doing business under your same name. If you don't register your business and someone else is doing business under the same DBA, then you could lose your right to continue doing business under that name and have to start over. Getting a cease and desist order could cost you a lot of money and could cost you clients.
Do your homework first.
· Research and find out what the legal requirements are for your chosen business.
· You need to know what insurance you need to cover your liabilities
· You need to know about the bonds you need to post or buy to cover yourself and your clients.
Don't over extend yourself.
· Under capitalization is the most common reason for business to fail. Simply put, you don't have enough money to keep your business going while you are getting it started.
· People often forget to figure out how much money it is going to take to sustain a business. Paying the help, rent, utilities and other expenses while business is growing can be costly.
o A way to figure this out is to run a test market. A scaled down version of what you are going to do.
o Consider trying to sell your product or service at a flea market where you have a lot of traffic to see how people will respond to your business.
o In other words, don't quit your day job until you are sure that your business will have a sustainable income.
By doing these things first, you will save yourself a lot of grief and possibly your business. No one starts a business just to see if they can skirt the laws, not pay taxes, or have someone else take over your business.
Lawsuits can be devastating to you and your family, protect yourself by obtaining the correct insurance or bonds and falling all the rules.
Robert enjoys many business ventures and sharing his passion with others. As a businessman, he always has new projects going. Visit his latest business venture at http://bbqgrillparts.org/ where he shares his knowledge of the BBQ Grill Cover.
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