Entrepreneurship can be an exciting opportunity filled with endless possibilities, but if you’re not prepared, the steps it takes to turn your dream into a reality may be overwhelming. If you’re considering finally working for yourself and starting your own business in the United States there are many steps to take before building your empire.
A genius idea is nothing without conducting market research to find out if there is actually a market in the United States for your product or service. Questions to ask during this step are what is the demand, market size, location, and pricing. There should be a desire for your product or service, therefore fulfilling the need for demand. If there are many people who desire the product, then the market size should be large enough to keep the business afloat.
The location of your consumers is also very important, too. If your business is unable to reach the consumer, then there is no need for your product, and if your product is not priced well, then the need for the product also dwindles. Once you’ve established an audience for your brand, having a smart business plan will help you secure any outside funding you would need from either investors or a bank loan.
To gain financing, start by exploring options for loans. GovLoans, the Small Business Administration and the Small Business Lending Fund are all great places in the United States to start researching. Nonprofit organizations in medicine or tech development can apply for federal grant funding. However, these organizations need to be somewhat established and not in their beginning stages. There are other federal and state assistance programs in the United States such as the Small Business Innovation Research Program. This program is awards-based and only for businesses that conduct federal research. To find investors, check out the Small Business Investment Company Program, where small business can find partners to privately fund their company. Once you’ve figured out how to fund your startup, it’s time to actually launch your business.
The first step after the initial planning stages is to decide what kind of business it will be. There is a great deal to consider when choosing how your business will be presented to the public, and many factors that could make or break your business depend on the route that is chosen. LLCs are the most common business types. These businesses keep your business assets and private assets separate from each other, therefore if your business goes into debt, your home and car will be safe from seizure. C-Corporations are for companies that expect to have investors who would take part in a share program. C-Corporations with shares means that the corporation itself will be taxed, and any money coming through via shares will also be taxed. This a double tax, and if you would like to avoid this double taxation, an S-Corporation may be a more suitable option. If your business makes more than $80,000 a year then this is the correct choice for your company.
Once someone has figured out the perfect business to construct, then comes the launch. Many steps of preparation go into beginning the process. The first step into starting a business in the United States is to register your business as a legal entity at the state and local level. Figuring out if your business is a corporation, nonprofit organization, partnership or sole proprietary company is the first step in determining what legal steps need to be taken.
As soon as the legal components are taken care of it is time to register the business’ name. This might seem redundant, but during this step instead of filing for financial and tax legality, this step includes choosing a name that will eventually be on all of the necessary permits and licenses. From there, the business requires an EIN number from the U.S. Internal Revenue Service. An application can be filled out online, but first check with your state to find if you will need a state number or charter, too.
This brings us to the next step, which is filing for state tax IDs. These are needed as well as the Federal IDs from the previous step. Finally, it’s time to acquire your licenses. You’re finally seen as a legal entity with a name and now you can start obtaining basic operating licenses, liquor permits, or anything else that your business will need.
You can purchase a US virtual phone number to give yourself a local presence. Virtual phone numbers can be local or toll free, and route calls to any other phone, anywhere in the world.
The World Bank rates The United States as the 51st in the world when it comes to the ease of launching a new company. This leads us to ask: why is it so hard for Americans to launch their own businesses? According to Inc.com, 550,000 startups were launched each month in the United States 2015. With that kind of competition, it is no wonder that the US ranks so lowly.
The main factor startups have to deal with is the working hours of time spent on dealing with government compliance. Federal, state and local business requirements often contradict each other and it takes a lot of time to figure out how to deal with their regulations. It is not a simple task to even register a business with the government because of the strange hours of municipal courts, furlough days, and the surprising amount of permits that need to be obtained before a launch. Another factor keeping the United States low in the rankings is the competition from other growing countries. Long-established existing regulations like those in America aren’t weighing down other countries that have not grown as quickly.
After following these steps, it’s time to open the doors. Once your business has officially begun, shift attention to focus on growth. Use social media, email lists, and marketing campaigns to reach a larger audience. Never forget about the customers that you already have; retaining them is so worth the effort and can be as important as acquisition. It is important to establish a relationship with existing consumers. Continue market research to make sure that your business is always on top of new and upcoming trends, and continue to develop your product to reach a higher and higher caliber. Keep focusing on the future and building the empire that you have always dreamed of, and always remain grateful for how far you have come.