Write a Business Plan
Form goals and objectives for your new company. Start with a detailed outline of what you plan to accomplish. You don’t necessarily need a formal plan unless you will seek a business loan, but you must do something if you plan to succeed. Even a properly done One Page Business plan can help.
Choose A Name
When you decide on a name for the business entity and search it on the internet (Google it) to see if anyone else is using the name. Just because the Arizona Corporation Commission allows you to reserve a name does not protect you if the the name is already in use.
Purchase A Domain Name
If you will have a website that is the same as the entity name, you can purchase the domain name at this stage, or wait until after you’ve checked the name availability through the Arizona Corporation Commission owning a domain name does not give you any right to the name through the A.C.C. or through the Arizona Secretary of State. Domain names are completely separate from the A.C.C. and the Arizona Secretary of State. Having a website is essential in today’s business world of internet searches and social media. Register a URL that is memorable and relevant to your company and/or industry.
Whether you use your own savings or obtain loans, starting a business requires money. The lack of sufficient money is the number one reason businesses fail is lack of sufficient capital. Starting a business on a shoestring budget and hoping to bootstrap your way to success is bucking the odds. There are plenty of free counseling and training services available that can help you prepare a business plan, secure financing and more.
Choose a Location
Think about the people your business is designed to serve and then pick a location most convenient to them. Most successfully businesses are where there is the right traffic for that business. In retail businesses it is crucial – you are really in the real estate business when you own a store.
Determine Your Legal Structure
Are you creating a sole proprietorship, a partnership, a limited liability company (LLC), corporate, S corporation, nonprofit or cooperative? Note there is much confusion regarding some names. – “S” corp, “C” corp, and “501c3” corp are only federal tax designations. They do not indicate your legal structure , only how you pay your taxes. Arizona you would just form a corporation or a nonprofit corporation. LLC are popular entity structures for many small businesses. This can protect owners personal assets from business debts and liabilities if used properly. Incorporating can provide credibility and tax benefits
Get an Tax Identification Number (TIN)
A TIN is like a social security number for your business and you’ll need to obtain it from the IRS or your state revenue agency.
Choose a Tax Year
A calendar year runs consecutively from Jan. 1 – Dec. 31, a fiscal year is 12 consecutive months ending on the last day of any month except December.
Register to Pay State and Local Taxes
You might need to complete a transaction privilege tax application with the Arizona Department of Revenue. Check the ADOR website, www.azdor.gov, and the Arizona Commerce Authority Small Business Services website www.azcommerce.com for more information.
You also may need to obtain insurance for your business. Coverage to consider includes general liability, umbrella coverage, workers’ compensation, unemployment and disability insurance. Don’t assume you do not need insurance if you are working from your home.
Obtain Business License and Permits
Arizona requires state and local licenses for many businesses.
Develop business collateral
Marketing material. Most buisnesses use customized letterhead, cards, and forms with their company name, logo and website for marketing and credibility. While there are many cheap printers on line, having a good relationship with a local printer could be a better idea for you.
Open a bank account and merchant account
To protect their corporate or LLC veil, businesses must maintain separate business and personal accounts and records. Establish a separate business bank account so your personal assets are not co-mingled with business funds. Banks may also require an Employer Identification Number (EIN) to open a business checking account. Your customers will want to pay you with no hassle. Depending on your expected volume of sales you may consider a merchant account. For lower transactions you might use PayPal or Square.
Learn your legal obligations before you hire employees.
Identify where to get help
Know where and when to seek advice from other sources, such as attorneys and accountants, to assist you with specific questions about your business. Establish a board of advisors or mentors to help you along the way. This can be formal or informal. Getting guidance from a mentor or someone already successful is a smart way to go.
Follow government rules
Operating a business means satisfying ongoing government and legal requirements to maintain the company’s good standing
Poulos Law Firm has extensive experience helping businesses get started here in Arizona. We are happy to help with many of the steps in the process.