Wondering what steps you have to take to get a new business started? What should you do first? What next? This startup checklist can help you determine the steps you need to take to launch your business the right way.
The business startup checklist below is meant to remind you of the tasks you may have to perform when starting your business. The checklist includes items that apply to many different types of startups. Many of the tasks need to be done for legal reasons, even if you’re starting a business with little or no money.
Not every small business will have to complete each step. For instance, you may decide not to register your trademark with state or federal officials before you launch the business. Or, you may not be required to publish a notice of intent to do business.
Since laws vary by state and by type of business, be sure to check with local authorities to determine if there are any additional legal steps you need to take. Small Business Development Centers and local SCORE (Service Corps of Retired Executives) chapters are both excellent, free resources that can help you identify local regulations as well as help you with other startup and small business questions.
Here’s our checklist for starting a business:
- Choose a business based on your skills and interests
- Assess your financial situation (more on this below)
- Research the business idea
- Research competitors
- Refine your business idea (more on this below)
- Write a business plan (more on this below)
- Write a marketing plan
- Choose the right legal entity type (more on this below)
- Choose a business name
- Determine if there are any patent restrictions
- Check trademark registrations to verify your right to use your chosen name
- See if the business name is available as a domain name
- Register the business name and get a business certificate
- Register your business domain name even if you aren’t ready to use it yet
- Register for your own trademark for your business name
- Choose a location for your business or make space in your home to run it
- Check zoning laws
- File partnership or incorporation papers
- Get any required licenses and permits
- Determine if there are health or safety laws with which you must comply
- Register copyrights for business intellectual property
- Apply for a patent or provisional patent for inventions
- Have a business phone line installed if you’ll be working from home
- Order phone, internet, and any utility services needed for a business location that isn’t home-based
- Get appropriate business insurance for your business (more on this below)
- Arrange for health insurance coverage if needed
- Talk to an accountant about your tax obligations and record keeping requirements
- Apply for a state sales tax number if needed
- Apply for an Employer Identification Number (EIN) if needed
- Inquire about workers compensation insurance and unemployment insurance if you’ll be hiring employees
- Open a bank account in the business name
- Set up an accounting system or accounting software for the business
- Setup your funding and create a budget for starting the business
- Have a logo created
- Order business cards, envelopes, and stationery for the business. Alternately, print them yourself, if you have the capability.
- Order business checks with the name imprinted
- Order inventory
- Purchase needed equipment and supplies
- Order signage
- Order fixtures
- Find a website hosting company or cloud-based storefront provider and set up your business website
- Set up a business email address (preferably using the business domain name)
- Set up social media pages for the business
- Start building a permission-based customer email list for newsletters and promotions
- Prepare brochures, flyers, and other handouts. Print or order a small quantity to promote your business opening
- Send out publicity releases
- Decide where and how to advertise your business
- Contact friends, family, and acquaintances and let them know you’ve started your business
- Plan and implement low-cost business promotion tactics to market your business
Let’s explore some of the checklist items in more detail:
Refine your business idea
Once you have a business idea, it’s time to sit down and do some market research. Try to get a sense of what your competitors are doing and what’s working for them.
You also need to figure out what sets you apart from the other competitors in your niche. This exercise is really important to help you figure out what your competitive advantage really is.
In addition to this, you need to understand why you’re starting a business. It could be to fulfill a personal need or a market gap. Whatever it is, it’s important to be clear about your purpose.
Based on your idea, give your target market some thought. Who are they? Write down as many details about them as you can, including age, gender, and location.
After defining your unique selling proposition (USP) and conducting a thorough market analysis, you’ll get a better idea of whether your business idea seems worth executing. At this stage, if you think your idea might not be effective, it’s okay to pivot or refine your idea.
Once you have a clear idea of your idea, USP, and target audience, it’s time to come up with a business name that’s relevant for your brand.
While choosing a name, keep in mind that it needs to be unique and brandable. It’s the first step in defining your brand personality and communicating what your brand stands for.
Choose the right legal entity type
Another early item on your business startup checklist is to decide on the right legal entity type for your business. This is an important decision to make as it can affect your personal liability, taxation arrangements, and more.
Some of the business structures that you can choose from include:
Partnership
In this type of arrangement, two or more people can be held personally liable as owners of the business. In addition to a general partnership, within this structure, there are two variations: limited liability partnerships (LLP) and limited partnerships (LP).
The major difference between the two arrangements is that the former gives limited liability to all the owners. In limited partnerships, only one partner gets unlimited liability, while the others get limited liability.
Corporation
This type of business structure is suitable for those who want to keep their liabilities separate from the liabilities of the company. It also offers different arrangements, each of which has different guidelines for the separation of liabilities.
Sole Proprietorship
This business structure is for those who want to own their business completely on their own. Only one person is responsible for obligations as well as debts, and their personal credit history can be directly affected, yet there is unlimited liability on your personal assets.
Limited Liability Company
A limited liability company (LLC) is a hybrid business structure that is a mix of partnership and corporation. In this arrangement, you get to reap the benefits of a partnership while getting the protection mechanism of a corporation. Need help setting your entity up? Check out us at ZenBusiness, the #1 alternative to Inc Authority.
Nonprofit Corporation
This structure is designed for any type of education, literary, charity, scientific, and religious work. These organizations are usually exempt from paying federal and state taxes.
Depending on your requirements and future goals, determine the best entity type for your business.
Assess your financial situation
Regardless of the type of business you want to start, you will need solid business financing to get it up and running. Do a quick assessment of the total amount of money you already have and the amount that you need. Based on this calculation, determine your options.
Where will you get all the required funds? Will you borrow money or pay for all the expenses yourself? It’s also worth considering whether or not you will need to leave your job to focus on your business.
If so, do you have money to support yourself till you start making profits? You have to keep in mind that it can take a couple of years for a startup to actually start making profits. To get a better idea of how to go about financial planning, you should perform a break-even analysis.
Financial decisions related to your business can directly make or break your business. That’s why it’s important for you to come up with a more sustainable business model.
Create a formal business plan
This step in the business startup checklist is especially relevant for those entrepreneurs who are seeking funding from investors.
Before you pitch your business idea, you should have a formal business plan ready. It should also contain a detailed section on finances as this is the most important part for investors.
In addition to this, your plan should also include details about your target market, products, services, company overview, and key milestones.
Buy business insurance
Purchasing an insurance policy for your business is something that should ideally be done before you launch.
Even if you may not require it immediately, it’s a good idea to buy it right away. In case of theft, fire accidents, or even lawsuits, an insurance policy can help you stay financially protected.
To maximize your risk protection, there are different types of insurance that you can buy.
These include:
- General liability insurance: This policy is important to protect your business from any third-party claims related to property damage or bodily injury. For instance, if a customer falls while shopping at your store, this insurance can cover their medical expenses.
- Worker’s compensation coverage: This policy covers medical benefits, disability benefits, wage replacement, and funeral expenses for any worker who gets injured while they are doing their job.
- Commercial property insurance: In case of theft, smoke damage, fire, or other such circumstances, this policy can help you cover the costs of tools, inventory, furniture, office equipment, and more.
- Business income insurance: This policy can help you replace your lost income in case of fire, theft, or such circumstances.
These are the most common types of business insurance, but there are many other types as well. Since all businesses are susceptible to risk, make sure you invest some time in understanding the types of insurance that you need for your business.
Conclusion
Now that you have a quick business startup checklist at your disposal, you can focus on getting all the work done. Are you ready to check off all the options from the list one by one? Remember that starting a business requires grit, dedication, patience, and a lot of hard work.
Disclaimer: The content on this page is for information purposes only and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.
ZenBusiness is a financial technology company and is not a bank. Banking services provided by Thread Bank, Member FDIC. The ZenBusiness Visa Debit Card is issued by Thread Bank pursuant to a license from Visa U.S.A. Inc. and may be used anywhere Visa debit cards are accepted. FDIC insurance is available for funds on deposit through Thread Bank, Member FDIC.
*Your deposits qualify for up to a maximum of $3,000,000 in FDIC insurance coverage when placed at program banks in the Thread Bank deposit sweep program. Your deposits at each program bank become eligible for FDIC insurance up to $250,000, inclusive of any other deposits you may already hold at the bank in the same ownership capacity. You can access the terms and conditions of the sweep program at https://go.thread.bank/sweepdisclosure and a list of program banks at https://go.thread.bank/programbanks. Please contact customerservice@thread.bank with questions regarding the sweep program.
