how to plan and start a business

An official website of the United States government

Here’s how you know

Official websites use .gov A .gov website belongs to an official government organization in the United States.

Secure .gov websites use HTTPS A lock ( Lock A locked padlock ) or https:// means you’ve safely connected to the .gov website. Share sensitive information only on official, secure websites.

10 steps to start your business

Conduct market research.

Market research will tell you if there’s an opportunity to turn your idea into a successful business. It’s a way to gather information about potential customers and businesses already operating in your area. Use that information to find a competitive advantage for your business.

Write your business plan

Your business plan is the foundation of your business. It’s a roadmap for how to structure, run, and grow your new business. You’ll use it to convince people that working with you — or investing in your company — is a smart choice.

Fund your business

Your business plan will help you figure out how much money you’ll need to start your business. If you don’t have that amount on hand, you’ll need to either raise or borrow the capital. Fortunately, there are more ways than ever to find the capital you need.

Pick your business location

Your business location is one of the most important decisions you’ll make. Whether you’re setting up a brick-and-mortar business or launching an online store, the choices you make could affect your taxes, legal requirements, and revenue.

Choose a business structure

The legal structure you choose for your business will impact your business registration requirements, how much you pay in taxes, and your personal liability.

Choose your business name

It’s not easy to pick the perfect name. You’ll want one that reflects your brand and captures your spirit. You’ll also want to make sure your business name isn’t already being used by someone else.

Register your business

Once you’ve picked the perfect business name, it’s time to make it legal and protect your brand. If you’re doing business under a name different than your own, you’ll need to register with the federal government, and maybe your state government, too.

Get federal and state tax IDs

You’ll use your employer identification number (EIN) for important steps to start and grow your business, like opening a bank account and paying taxes. It’s like a social security number for your business. Some — but not all — states require you to get a tax ID as well.

Apply for licenses and permits

Keep your business running smoothly by staying legally compliant. The licenses and permits you need for your business will vary by industry, state, location, and other factors.

Open a business bank account

A small business checking account can help you handle legal, tax, and day-to-day issues. The good news is it’s easy to set one up if you have the right registrations and paperwork ready.

Now: Open shop

Congratulations! It's time to cut the big ribbon. Your business is officially open. Now, focus on managing and growing your business.

How to Start a Business: A Step-by-Step Guide

Table of contents.

• You should prepare thoroughly before starting a business, but realize that things will almost certainly go awry. To run a successful business, you must adapt to changing situations.
• Learning how to start your own business involves conducting in-depth market research on your field and the demographics of your potential clientele is an important part of crafting a business plan.
• In addition to selling your product or service, you need to build up your brand and get a following of people who are interested in what your business offers.
• This article is for anyone who wants to learn how to start a business.

Starting a business can be hard work, but if you break down the process of launching your new company into individual steps you can make it easier. Rather than spinning your wheels and guessing where to start, you can follow the tried and true methods of entrepreneurs who’ve done it successfully. If you want to learn how to start your own business, follow this 10-step checklist to transform your business from a lightbulb above your head into a real entity.

Starting a business is a lot of work, but we’re here to help! Check out our useful resources for everything you need to successfully build your business from the ground up.

• 11 Things To Do Before Starting A Business
• Tax and Business Forms You’ll Need To Start A Business
• Startup Costs: How Much Cash Will You Need?
• 20 Mistakes To Avoid When Starting A Business

How to start a business

1. refine your idea..

If you’re thinking about starting a business, you likely already have an idea of what you want to sell online , or at least the market you want to enter. Do a quick search for existing companies in your chosen industry. Learn what current brand leaders are doing and figure out how you can do it better. If you think your business can deliver something other companies don’t (or deliver the same thing, only faster and cheaper), you’ve got a solid idea and are ready to create a business plan. 

Define your “why?”

“In the words of Simon Sinek, ‘always start with why,’” Glenn Gutek, CEO of Awake Consulting and Coaching, told Business News Daily. “It is good to know why you are launching your business. In this process, it may be wise to differentiate between [whether] the business serves a personal why or a marketplace why. When your why is focused on meeting a need in the marketplace, the scope of your business will always be larger than a business that is designed to serve a personal need.” 

Consider franchising.

Another option is to open a franchise of an established company. The concept, brand following and business model are already in place; you only need a good location and the means to fund your operation.

Brainstorm your business name.

Regardless of which option you choose, it’s vital to understand the reasoning behind your idea. Stephanie Desaulniers, owner of Business by Dezign and former director of operations and women’s business programs at Covation Center, cautions entrepreneurs against writing a business plan or brainstorming a business name before nailing down the idea’s value.

Editor’s note: Looking for a small business loan? Fill out the questionnaire below to have our vendor partners contact you about your needs.

Clarify your target customers.

Desaulniers said too often, people jump into launching their business without spending time to think about who their customers will be and why those customers would want to buy from them or hire them.

“You need to clarify why you want to work with these customers — do you have a passion for making people’s lives easier?” Desaulniers said. “Or enjoy creating art to bring color to their world? Identifying these answers helps clarify your mission. Third, you want to define how you will provide this value to your customers and how to communicate that value in a way that they are willing to pay.” 

During the ideation phase, you need to iron out the major details. If the idea isn’t something you’re passionate about or if there’s no market for your creation, it might be time to brainstorm other ideas.

Tip: To refine your business idea, identify your “why,” your target customers and your business name.

2. Write a business plan.

Once you have your idea in place, you need to ask yourself a few important questions: What is the purpose of your business? Who are you selling to? What are your end goals? How will you finance your startup costs? These questions can be answered in a well-written business plan . 

Fledgling business owners can make a lot of mistakes by rushing into things without pondering these aspects of the business. You need to find your target customer base. Who is going to buy your product or service? What would be the point if you can’t find evidence of a demand for your idea? 

This business plan template can help you launch and grow your business the right way.

Conduct market research.

Conducting thorough market research on your field and the demographics of your potential clientele is an important part of crafting a business plan. This involves conducting surveys, holding focus groups, and researching SEO and public data. 

Market research helps you understand your target customer — their needs, preferences and behavior — as well as your industry and competitors. Many small business professionals recommend gathering demographic information and conducting a competitive analysis to better understand opportunities and limitations within your market. 

The best small businesses have differentiated products or services from the competition. This significantly impacts your competitive landscape and allows you to convey unique value to potential customers.

Consider an exit strategy.

It’s also a good idea to consider an exit strategy as you compile your business plan. Generating some idea of how you’ll eventually exit the business forces you to look to the future. 

“Too often, new entrepreneurs are so excited about their business and so sure everyone everywhere will be a customer that they give very little, if any, time to show the plan on leaving the business,” said Josh Tolley, CEO of both Shyft Capital and Kavana. 

“When you board an airplane, what is the first thing they show you? How to get off of it. When you go to a movie, what do they point out before the feature begins to play? Where the exits are. During your first week of kindergarten, they line up all the kids and teach them fire drills to exit the building. Too many times I have witnessed business leaders that don’t have three or four predetermined exit routes. This has led to lower company value and even destroyed family relationships.” 

A business plan helps you figure out where your company is going, how it will overcome any potential difficulties, and what you need to sustain it. When you’re ready to put pen to paper, use a free template to help.

3. Assess your finances.

Starting any business has a price, so you need to determine how you will cover those costs. Do you have the means to fund your startup, or will you need to borrow money? If you’re planning to leave your current job to focus on your business, do you have savings to support yourself until you make a profit? Find out how much your startup costs will be. 

Many startups fail because they run out of money before turning a profit. It’s never a bad idea to overestimate the amount of startup capital you need, as it can take time before the business begins to bring in sustainable revenue. 

Perform a break-even analysis.

One way you can determine how much money you need is to perform a break-even analysis. This essential element of financial planning helps business owners determine when their company, product or service will be profitable. 

The formula is simple:

• Fixed Costs ÷ (Average Price Per Unit – Variable Costs) = Break-Even Point

Every entrepreneur should use this formula as a tool because it tells you the minimum performance your business must achieve to avoid losing money. Furthermore, it helps you understand exactly where your profits come from, so you can set production goals accordingly. 

Here are the three most common reasons to conduct a break-even analysis: 

Ask yourself: How much revenue do I need to generate to cover all my expenses? Which products or services turn a profit, and which ones are sold at a loss?

Ask yourself: What are the fixed rates, what are the variable costs, and what is the total cost? What is the cost of any physical goods? What is the cost of labor?

Ask yourself: How can I reduce my overall fixed costs? How can I reduce the variable costs per unit? How can I improve sales? 

Watch your expenses.

Don’t overspend when starting a business. Understand the types of purchases that make sense for your business and avoid overspending on fancy new equipment that won’t help you reach your business goals. Monitor your business expenses to ensure you are staying on track.

“A lot of startups tend to spend money on unnecessary things,” said Jean Paldan, founder and CEO of Rare Form New Media. “We worked with a startup with two employees but spent a huge amount on office space that would fit 20 people. They also leased a professional high-end printer that was more suited for a team of 100; it had key cards to track who was printing what and when. Spend as little as possible when you start, and only on the things essential for the business to grow and succeed. Luxuries can come when you’re established.”  

Using accounting software can streamline your expense tracking. Read our reviews of the best accounting software to learn more and find the right platform for your needs. Try starting with our Intuit QuickBooks Online review — this vendor is our top pick for small businesses.

Consider your funding options.

Startup capital for your business can come from various means. The best way to acquire funding for your business depends on several factors, including creditworthiness, the amount needed and available options.

• Business loans. If you need financial assistance, a commercial loan through a bank is a good starting point, although these are often difficult to secure. If you cannot take out a bank loan, apply for a small business loan through the S. Small Business Administration (SBA) or an alternative lender. [Read related article: Best Business Loans ]
• Business grants. Business grants are similar to loans, but do not need to be paid back. Business grants are typically very competitive and come with stipulations that the business must meet to be considered. When securing a small business grant , look for ones specific to your situation. Options include minority-owned business grants, grants for women-owned businesses and government grants .
• Startups that require significant funding up front may want to bring on an angel investor . Investors can provide several million dollars or more to a fledgling company in exchange for a hands-on role in running your business.
• Alternatively, you can launch an equity crowdfunding campaign to raise smaller amounts of money from multiple backers. Crowdfunding has helped numerous companies in recent years, and dozens of reliable crowdfunding platforms are designed for different types of businesses. 

You can learn more about each of these capital sources and more in our guide to startup finance options . 

Choose the right business bank.

When you’re choosing a business bank , size matters. Marcus Anwar, co-founder of OhMy Canada, recommends smaller community banks because they are in tune with the local market conditions and will work with you based on your overall business profile and character. 

“They’re unlike big banks that look at your credit score and will be more selective to loan money to small businesses,” Anwar said. “Not only that, but small banks want to build a personal relationship with you and ultimately help you if you run into problems and miss a payment. Another good thing about smaller banks is that decisions are made at the branch level, which can be much quicker than big banks, where decisions are made at a higher level.” 

Anwar believes that you should ask yourself these questions when choosing a bank for your business: 

• What is important to me?
• Do I want to build a close relationship with a bank that’s willing to help me in any way possible?
• Do I want to be just another bank account, like big banks will view me as? 

Ultimately, the right bank for your business comes down to your needs. Writing down your banking needs can help narrow your focus to what you should be looking for. Schedule meetings with various banks and ask questions about how they work with small businesses to find the best bank for your business. [Read related article: Business Bank Account Checklist: Documents You’ll Need ]

Financially, you should perform a break-even analysis, consider your expenses and funding options, and choose the right bank for your business.

4. Determine your legal business structure.

Before registering your company, you need to decide what kind of entity it is. Your business structure legally affects everything from how you file your taxes to your personal liability if something goes wrong. 

• Sole proprietorship: You can register for a sole proprietorship if you own the business independently and plan to be responsible for all debts and obligations. Be warned that this route can directly affect your personal credit.
• Partnership: Alternatively, as its name implies, a business partnership means that two or more people are held personally liable as business owners. You don’t have to go it alone if you can find a business partner with complementary skills to your own. It’s usually a good idea to add someone into the mix to help your business flourish.
• Corporation: If you want to separate your personal liability from your company’s liability, consider the pros and cons of corporations (e.g., an S corporation or C corporation ). Although each type of corporation is subject to different guidelines, this legal structure generally makes a business a separate entity from its owners. Therefore, corporations can own property, assume liability, pay taxes, enter contracts, sue and be sued like any other individual. “Corporations, especially C corporations, are especially suitable for new businesses that plan on ‘going public’ or seeking funding from venture capitalists in the near future,” said Deryck Jordan, managing attorney at Jordan Counsel.
• Limited liability company: One of the most common structures for small businesses is the limited liability company (LLC). This hybrid structure has the legal protections of a corporation while allowing for the tax benefits of a partnership. 

Ultimately, it is up to you to determine which type of entity is best for your current needs and future business goals. It’s important to learn about the various legal business structures available. If you’re struggling to make up your mind, discussing the decision with a business or legal advisor is a great idea.

Did you know? You need to choose a legal structure for your business, such as a sole proprietorship, partnership, corporation or LLC .

5. Register with the government and IRS.

You will need to acquire business licenses before you can legally operate your business. For example, you must register your business with federal, state and local governments. There are several documents you must prepare before registering.

Articles of incorporation and operating agreements

To become an officially recognized business entity, you must register with the government. Corporations need an articles of incorporation document, which includes your business name, business purpose, corporate structure, stock details and other information about your company. Similarly, some LLCs will need to create an operating agreement.

Doing business as (DBA)

If you don’t have articles of incorporation or an operating agreement, you will need to register your business name, which can be your legal name, a fictitious DBA name (if you are the sole proprietor), or the name you’ve come up with for your company. You may also want to take steps to trademark your business name for extra legal protection. 

Most states require you to get a DBA. You may need to apply for a DBA certificate if you’re in a general partnership or a sole proprietorship operating under a fictitious name. Contact or visit your local county clerk’s office to ask about specific requirements and fees. Generally, there is a registration fee involved. 

Employer identification number (EIN)

After you register your business, you may need to get an employer identification number from the IRS. While this is not required for sole proprietorships with no employees, you may want to apply for one anyway to keep your personal and business taxes separate, or to save yourself the trouble if you decide to hire someone later on. The IRS has provided a checklist to determine whether you will require an EIN to run your business. If you do need an EIN, you can register online for free. 

Income tax forms

You must file certain forms to fulfill your federal and state income tax obligations . Your business structure determines the forms you need. You will need to check your state’s website for information on state-specific and local tax obligations. Once you set this all up, the best online tax software can help you file and pay your taxes quarterly and annually.

“You might be tempted to wing it with a PayPal account and social media platform, but if you start with a proper foundation, your business will have fewer hiccups to worry about in the long run,” said Natalie Pierre-Louis, licensed attorney and owner of NPL Consulting. 

Federal, state, and local licenses and permits

Some businesses may also require federal, state or local licenses and permits to operate. Your local city hall is the best place to obtain a business license. You can then use the SBA’s database to search for state and business type licensing requirements. 

Businesses and independent contractors in certain trades are required to carry professional licenses. A commercial driver’s license (CDL) is one example of a professional business license. Individuals with a CDL can operate certain types of vehicles, such as buses, tank trucks and tractor-trailers. A CDL is divided into three classes: Class A, Class B and Class C. 

You should also check with your city and state to find out if you need a seller’s permit that authorizes your business to collect sales tax from your customers. A seller’s permit goes by numerous names, including resale permit, resell permit, permit license, reseller permit, resale ID, state tax ID number, reseller number, reseller license permit or certificate of authority. 

It’s important to note that these requirements and names vary from state to state. You can register for a seller’s permit through the state government website of the state(s) you’re doing business in. 

Jordan says that not all businesses need to collect sales tax (or obtain a seller’s permit).

“For example, New York sales tax generally is not required for the sale of most services (such as professional services, education, and capital improvements to real estate), medicine or food for home consumption,” Jordan said. “So, for example, if your business only sells medicine, you do not need a New York seller’s permit. But New York sales tax must be collected in conjunction with the sale of new tangible personal goods, utilities, telephone service, hotel stays, and food and beverages (in restaurants).”

Register key documents like articles of incorporation or an operating agreement, a DBA, an EIN, income tax forms, and other applicable licenses and permits.

6. Purchase an insurance policy.

It might slip your mind as something you intend to get around to eventually, but purchasing the right insurance for your business is an important step to take before you officially launch. Dealing with incidents such as property damage, theft or even a customer lawsuit can be costly, and you need to be sure that you’re properly protected. 

Although you should consider several types of business insurance , there are a few basic insurance plans that most small businesses can benefit from. For example, if your business will have employees, you will at least need to purchase workers’ compensation and unemployment insurance.

You may also need other types of coverage, depending on your location and industry, but most small businesses are advised to purchase general liability (GL) insurance, or a business owner’s policy. GL covers property damage, bodily injury, and personal injury to yourself or a third party.

If your business provides a service, you may also want professional liability insurance. It covers you if you do something wrong or neglect to do something you should have done while operating your business.

7. Build your team.

Unless you’re planning to be your only employee, you’ll need to recruit and hire a great team to get your company off the ground. Joe Zawadzki, general partner at AperiamVentures, said entrepreneurs need to give the “people” element of their businesses the same attention they give their products. 

“People build your product,” Zawadzki said. “ Identifying your founding team , understanding what gaps exist, and [determining] how and when you will address them should be top priority. Figuring out how the team will work together … is equally important. Defining roles and responsibilities, division of labor, how to give feedback, or how to work together when not everyone is in the same room will save you a lot of headaches down the line.”

8. Choose your vendors.

Running a business can be overwhelming, and you and your team probably aren’t going to be able to do it all on your own. That’s where third-party vendors come in. Companies in every industry, whether that’s HR or business phone systems , exist to partner with you and help you run your business better. For example, with a business phone system, you can design an IVR system to automatically route your callers to the right representatives.

When you’re searching for B2B partners, choose carefully. These companies will have access to your most vital and potentially sensitive business data, so finding someone you can trust is critical. In our guide to choosing business partners , our expert sources recommended asking potential vendors about their experience in your industry, their track record with existing clients, and what kind of growth they’ve helped other clients achieve. 

Not every business will need the same type of vendors, but there are common products and services that almost every business will need. Consider the following functions that are a necessity for any type of business.

• Enabling multiple customer payment types: Offering multiple payment options will ensure you can make a sale in whatever format is easiest for the target customer. Compare options to find the best credit card processing provider to ensure you’re getting the best rate for your business. That’s because small business credit card processing is often a direct route to more revenue and a larger customer base.
• Taking customer payments: Set up a point-of-sale (POS) system so that you have a state-of-the-art interface for making sales. The best POS systems couple this payment technology — which largely overlaps with credit card processing — with inventory management and customer management features. As such, POS systems are especially important if you plan to sell products instead of offering services.
• Managing finances: Many business owners manage their own accounting functions when starting their business, but as your business grows, you can save time by hiring an accountant , or by choosing the right accounting software provider .

9. Brand yourself and advertise.

Before you start selling your product or service, you need to build up your brand and get a following of people who are ready to jump when you open your literal or figurative doors for business.

• Company website: Take your reputation online and build a company website . Many customers turn to the internet to learn about a business, and a website is a digital proof that your small business exists. It is also a great way to interact with current and potential customers.
• Social media: Use social media to spread the word about your new business, perhaps as a promotional tool to offer coupons and discounts to followers once you launch. The best social media platforms to use will depend on your target audience.
• CRM: The best CRM platforms allow you to store customer data to improve how you market to them. A well-thought-out email marketing campaign can do wonders for reaching customers and communicating with your audience. To be successful, you will want to strategically build your email marketing contact list .
• Logo: Create a logo to help people easily identify your brand, and use it across all of your platforms.

Keep your digital assets up to date with relevant, interesting content about your business and industry. According to Ruthann Bowen, chief marketing officer at EastCamp Creative, too many startups have the wrong mindset about their websites. 

“The issue is they see their website as a cost, not an investment,” Bowen said. “In today’s digital age, that’s a huge mistake. The small business owners who understand how critical it is to have a great online presence will have a leg up on starting out strong.” 

Creating a marketing plan that goes beyond your launch is essential to building a clientele because it should continually get the word out about your business. This process is just as important as providing a quality product or service, especially in the beginning. 

Ask customers to opt into your marketing communications.

As you build your brand, ask your customers and potential customers for permission to communicate with them. The easiest way to do this is by using opt-in forms of consent. These forms allow you to contact them with further information about your business, according to Dan Edmonson, founder and CEO of Dronegenuity. 

“These types of forms usually pertain to email communication and are often used in e-commerce to request permission to send newsletters, marketing material, product sales, etc. to customers,” Edmonson said. “Folks get so many throwaway emails and other messages these days that, by getting them to opt in to your services transparently, you begin to build trust with your customers.” 

Opt-in forms are a great starting point for building trust and respect with potential customers. Even more importantly, these forms are required by law. The CAN-SPAM Act of 2003 sets requirements for commercial email by the Federal Trade Commission. This law doesn’t just apply to bulk email; it covers all commercial messages, which the law defines as “any electronic mail message the primary purpose of which is the commercial advertisement or promotion of a commercial product or service.” Each email violating this law is subject to fines of more than $40,000.

Tip: Create a strategic marketing campaign that combines various marketing channels, like a company website, social media, email newsletters and opt-in forms.

10. Grow your business.

Your launch and first sales are only the beginning of your task as an entrepreneur. To make a profit and stay afloat, you always need to be growing your business. That takes time and effort, but you’ll get out of your business what you put into it. 

Collaborating with more established brands in your industry is a great way to achieve growth. Reach out to other companies and ask for some promotion in exchange for a free product sample or service. Partner with a charity organization, and volunteer some of your time or products to get your name out there. 

While these tips will help launch your business and get you set to grow, there’s never a perfect plan. You want to ensure you prepare thoroughly for starting a business, but things will almost certainly go awry. To run a successful business, you must adapt to changing situations. 

FAQs about starting a business

What are the four basics for starting a business.

The four basics for starting a business are your business name, business structure, business registration certificate and all your other licenses. You must take the proper legal and regulatory steps in each of these four areas before you launch your business. Obtaining external funding and putting together a business plan are also smart moves, but they aren’t legal prerequisites.

How can I start my own business with no money?

You can launch a successful business without any startup funds. Work on a business idea that builds on your skill set to offer something new and innovative to the market. While developing a new business, keep working in your current position to reduce the financial risk.

Once you’ve developed your business idea and are ready to start on a business plan, you’ll need to get creative with funding. You can raise money through investments by pitching your idea to financial backers. You could also gather funding through crowdsourcing platforms like Kickstarter, or set aside a certain amount of money from your weekly earnings to put toward a new business. Finally, you can seek loan options from banks and other financial institutions to get your company up and running.

Check out our list of low-cost business ideas for inspiration on how to start a new company when you’re on a tight budget.

What is the easiest business to start?

The easiest business to start is one that requires little to no financial investment upfront, and no extensive training to learn the business. A dropshipping company, for example, is one of the easiest types of new business to launch. Dropshipping requires no inventory management, which saves you the hassle of buying, storing and tracking stock. 

Instead, another company fulfills your customer orders at your behest. This company manages the inventory, packages goods, and ships out your business orders. To start, create an online store by selecting curated products from the catalog available through partners.

Check out our list of businesses you can start quickly for ideas on how to launch your next business with ease.

Which types of businesses can I start from home?

In today’s world of remote work, you may be thinking of an online business idea . Any online-only business that doesn’t require inventory should be easy to start from home. Ideas that fall within this category include but aren’t limited to copywriting businesses, online tutoring operations and dropshipping businesses. Anything you’re good at or passionate about that you can do from home, and for which demand exists, can make for a great home business. 

When is the best time to start a business?

Each person’s ideal timeline for starting a new business will be different. Start a business only when you have enough time to devote your attention to the launch. If you have a seasonal product or service, then you should start your business one quarter before your predicted busy time of the year. Spring and fall are popular times of year to launch for nonseasonal companies. Winter is the least popular launch season because many new owners prefer to have their LLC or corporation approved for a new fiscal year.

Max Freedman and Skye Schooley also contributed to this article. Source interviews were conducted for a previous version of this article.

Building Better Businesses

Insights on business strategy and culture, right to your inbox. Part of the business.com network.

• Business Strategy
• How to Start a Business in 10 Easy Steps
• Expansion Strategy for Startups

How to Start a Business From Scratch

How to start a business in 7 easy steps, 1. start with a good business idea.

• Business consulting
• Cleaning services
• Tax preparation and bookkeeping
• Event planning
• Jewelry making
• Copywriting services
• Personal training
• Music lessons
• Computer training
• Graphic design
• Landscaping
• Financial planning
• Photography

2. Conduct Research About Your Business Idea

• Understand your customers’ needs
• Identify potential problems with your product or service
• Lessen financial losses by helping you make more informed decisions
• Find niche markets you may not have known about
• Set goals that can guide your business

3. Write a Business Plan

• Title page and contents: Investors use your business plan to get a feel for your company. That’s why keeping it organized and easy to navigate is helpful.
• Statement of purpose : This summarizes your products, market and business operation. It also states if you’re looking for funding or not.
• Product descriptions : Explain each detail of your product or services and how they benefit your customers.
• Market analysis: Outline your target demographic, selling trends and customer expectations.
• Competitor analysis: This should highlight strengths and weaknesses of companies that have similar products or services.
• Finding potential weaknesses
• Communicating your ideas to stakeholders
• Organizing important information about your business
• Hiring employees that are right for your company

4. Make Your New Business Official

• Register your business with your state: This gives you legal grounds to move forward using your brand’s name.
• Pick-up the right licenses and permits: Depending on your business, this can include food, liquor, health or business licenses.
• Get a tax ID number: This allows the IRS to track your transactions. You’ll also need this to open a bank account.

5. Know Your Finances

• Asking your friends and family for extra money
• Getting a small business loan
• Looking for grants or local funding
• Encouraging angel investors to back your company
• Freelance writing
• Dog walking
• Book keeping
• Interior design

6. Protect Your Business

• General liability insurance to help protect your company from liability claims alleging bodily injury, property damage, libel or slander.
• Business income insurance for help replacing lost income if you have to temporarily close your operation due to fire, theft or wind damage.
• Data breach coverage which helps pay costs if your customers, patients or employees private data is lost or stolen.
• Professional liability coverage for protection if you’re sued for negligence or errors in the services you provide.
• Commercial property insurance which helps pay for damages to your building, equipment, inventory, furniture and fixtures.

7. Build Your Business

How to start a startup.

• Make a business plan
• Secure funding
• Surround yourself with the right people
• Follow the right legal procedures
• Establish a location
• Develop a marketing plan
• Build your customer base
• Plan to change

Lean Startup Methodology

Early stage startup.

Need Business Insurance?

Explore all expansion topics for startup business.

5 People You Must Have on Your Startup Team Setting Up an Office Should You Start a Business in Retirement? Are You Thinking of Buying a Franchise? How to Start a Business From Scratch

In This Section

How to Start a Business

Ready to start your business don’t know where to start with this guide, you’ll go from a simple idea to a growing business in 12 easy steps..

1. What to do before starting a business

Why are you starting a business? What does it take to be successful? Could you start with a side hustle? Let’s help you answer these and other vital questions before setting up your business.

Get Started

In this section

2. Find the right business idea

Once you know why you want to start a business, it’s time to find and develop your idea. Learn what it takes to develop a good idea and explore our curated lists of potential business ideas that may be a good fit.

3. Validate your business idea

How do you know if your business idea will work? By testing it out and verifying that you’re solving a real problem for real people. Here’s what you should do after coming up with your business idea.

4. Conduct market research

Who are your customers? Who are your competitors? What does the industry look like? Will you be able to successfully enter this market? These are necessary questions to answer with a bit of research.

5. Select your business model

How will you make money? This is answered with your business model, which covers how your costs, revenue streams, and customer expectations work together. And you don’t have to start from scratch—check out these common types of business models.

6. Price your products and services

What are your customers willing to pay? It’s difficult to know when starting out, but don’t let that stop you. Learn how to set initial prices and compare common pricing models that may work for your business.

7. Write your business plan

You need a business plan before starting a business. This isn’t about checking a box but improving your understanding of what it takes to run a successful business. Check out our Business Planning Guide for everything you need to write a great business plan.

8. Make your business legal

Before setting up shop, you must check all the necessary legal boxes. Don’t worry about spending hours researching—we’ve compiled the most common legal requirements.

9. Set up your finances

You need a firm grasp of your startup costs and funding needs. Which requires you to forecast your sales, expenses, and cash flow. That may sound daunting, but we’ve broken it down into steps to follow and even cover setting up accounting and payroll systems.

10. Choose a business location

Will you be selling online? Running a traditional brick-and-mortar location? Maybe a bit of both? You need to consider where and how you’ll sell your products. Let’s explore what to look for in a physical retail location and how to make a splash online.

11. Put your team together

Learn to identify the right time to hire, what makes a good employee, and how to successfully grow your team.

12. Market your business

Learn the basics of creating a small business marketing plan, including what to prepare beforehand and how to track the impact of your marketing efforts.

How to start a nonprofit

Nonprofits are designed to pursue a mission, not generate profits. That doesn’t mean you can skip traditional startup steps—in fact, it may be even more crucial to your survival.

How to start a home-based business

Home-based businesses can provide a quicker startup path, greater flexibility, and lower costs. Learn how to take advantage of these benefits and establish a successful business.

How to start a franchise

Franchising is a great way to launch a business without having to start from scratch. Get to know the nuances of this business type and find out if it’s a better fit for you.

Tips to start your business

Looking for additional guidance to help get your business off the ground? We’ve rounded up our favorite tips and resources from entrepreneurial experts to do just that.

Industry startup guides

Interested in learning more about starting a specific type of business? Check out our growing list of industry startup guides for more detailed insights.

Resources and templates for starting a business

Business startup checklist

Try this simple checklist for an easy way to track your progress when starting a business.

Download Tool

Business idea validation checklist

Want to find out if your business idea is a winner? Work through this checklist to test it.

Business plan template

Make writing a business plan easy and improve your chances of success with this fill-in-the-blank template.

Download Template

Build a roadmap for success with LivePlan

Quickly consider every aspect of your business, build your business plan, and create accurate financial reports that help you start and grow.

Starting a business FAQ

What are the basic steps to start a business?

To start a business, you’ll need to—identify and validate your business idea, conduct market research, select a business model and pricing strategy, write a business plan and financial plan, select your business structure, register your business and obtain licenses and permits, select an online or physical location, start building your team if necessary, and promote your business through marketing and advertising.

How much money do you usually need to start a business?

The amount of money needed to start a business varies greatly depending on the type and scale of the business. It could range from a few hundred dollars for a home-based service business to several thousand or even millions for a manufacturing or tech startup. You must carefully consider and forecast your startup costs and cash flow to fully understand how much money you need to start.

What should I do first when starting a business?

The first step in starting a business is identifying a viable business idea and conducting market research to understand the demand, competition, and potential challenges. Additionally, it’s worth self-reflection to determine if you want to jump into entrepreneurship.

What do I need to start my first business?

At a minimum, you’ll need a business idea, a business plan, capital, a legal structure, a registered business name, necessary licenses and permits, a business bank account, and an accounting system.

How can I start a business with no money?

Starting a business with no money can be challenging but not impossible. You can consider service-based businesses that require minimal upfront costs. You can also minimize your upfront investment by starting your business as a side hustle while retaining a full or part-time job.

What 3 things make a business successful?

A clear and compelling value proposition, a strong understanding of the market and customers, and effective management and operations are three key elements that contribute to business success.

How can I start a simple business?

Starting a simple business often involves offering a service based on your skills or interests. This could be anything from pet sitting to graphic design. The key steps include identifying your service, understanding your market, setting prices, and promoting your business.

How do I start a beginner business?

As a beginner, start with a business idea that aligns with your skills and passions. Conduct market research, write a one-page business plan, and test if your idea resonates with your target customers. Start small, learn from the experience, and gradually grow your business.

How to start a business with only $100?

With only $100, consider a service-based or online business that requires minimal startup costs. This could be a consulting service, online tutoring, freelance writing, or selling handmade products. Use social media and free online tools for marketing and management to keep costs low.

Flash Sale. 40% Off the #1 rated business plan builder

• Search Search Please fill out this field.

Conducting Market Research

Crafting a business plan, reviewing funding options, understanding legal requirements, implementing marketing strategies, how much does it cost to start a business, what should i do before starting a business, what types of funding are available to start a business, do you need to write a business plan, the bottom line.

• Small Business
• How to Start a Business

How to Start a Business: A Comprehensive Guide and Essential Steps

Building an effective business launch plan

Starting a business in the United States involves a number of different steps, spanning legal considerations, market research, creating a business plan, securing funding, and developing a marketing strategy. It also entails decisions around a business’s location, structure, name, taxation, and registration.

This article covers the key steps involved in starting a business, as well as important aspects of the process for entrepreneurs to consider.

Key Takeaways

• Entrepreneurs seeking to develop their own business should start by conducting market research to understand their industry space and competition, and to target customers.
• The next step is to write a comprehensive business plan, outlining the company’s structure, vision, and strategy. Potential funders and partners may want to review the business plan in advance of signing any agreements.
• Securing funding is crucial in launching a business. Funding can come in the form of grants, loans, venture capital, or crowdfunded money; entrepreneurs may also opt to self-fund instead of or in combination with any of these avenues.
• Choosing a location and business structure can have many implications for legal aspects of business ownership, such as taxation, registration, and permitting, so it’s important to fully understand the regulations and requirements for the jurisdiction in which the business will operate. 
• Another key aspect of launching a new business is having a strategic marketing plan that addresses the specifics of the business, industry, and target market.

Before starting a business, entrepreneurs should conduct market research to determine their target audience, competition, and market trends. 

The U.S. Small Business Administration (SBA) recommends researching demographic data around potential customers to understand a given consumer base and reduce business risk. It also breaks down common market considerations as follows:

• Demand : Do people want or need this product or service?
• Market size : How many people might be interested?
• Economic indicators : These include income, employment rate, and spending habits of potential customers.
• Location : Where are the target market and the business located?
• Market saturation : How competitive is the business space, and how many similar offerings exist?
• Pricing : What might a customer be willing to pay?

Market research should also include an analysis of the competition (including their strengths and weaknesses compared to those of the proposed business), market opportunities and barriers to entry, industry trends, and competitors’ market share .

There are various methods for conducting market research, and the usefulness of different sources and methodologies will depend on the nature of the industry and potential business. Data can come from a variety of sources: statistical agencies, economic and financial institutions, and industry sources, as well as direct consumer research through focus groups, interviews, surveys, or questionnaires.

A comprehensive business plan is like a blueprint for a business. It will help lay the foundation for business development and can assist in decision making, day-to-day operations, and growth. 

Potential investors or business partners may want to review and assess a business plan in advance of agreeing to work together. Financial institutions often request business plans as part of an application for a loan or other forms of capital. 

Business plans will differ according to the needs and nature of the company and only need to include what makes sense for the business in question. As such, they can vary in length and structure depending on their intended purpose. 

Business plans can generally be divided into two formats: traditional business plans and lean startup business plans. The latter is typically more useful for businesses that will need to adjust their planning quickly and frequently, as they are shorter and provide a higher-level overview of the company.

The process of funding a business can be as unique as the business itself—that is, it will depend on the needs and vision of the business and the current financial situation of the business owner. 

The first step in seeking funding is to calculate how much it will cost to start the business. Estimate startup costs by identifying a list of expenses and putting a number to each of them through research and requesting quotes. The SBA has a startup costs calculator for small businesses that includes common types of business expenses. 

From there, an entrepreneur will need to determine how to secure the required funding. Common funding methods include:

• Self-funding , also known as bootstrapping  
• Seeking funding from investors, also known as venture capital  
• Raising money by crowdfunding
• Securing a business loan
• Winning a business grant

Each method will hold advantages and disadvantages depending on the situation of the business. It’s important to consider the obligations associated with any avenue of funding. For example, investors generally provide funding in exchange for a degree of ownership or control in the company, whereas self-funding may allow business owners to maintain complete control (albeit while taking on all of the risk). 

The availability of funding sources is another potential consideration. Unlike loans, grants do not have to be paid back—however, as a result, they are a highly competitive form of business funding. The federal government also does not provide grants for the purposes of starting or growing a business, although private organizations may. On the other hand, the SBA guarantees several categories of loans to support small business owners in accessing capital that may not be available through traditional lenders.

Whichever funding method (or methods) an entrepreneur decides to pursue, it’s essential to evaluate in detail how the funding will be used and lay out a future financial plan for the business, including sales projections and loan repayments , as applicable.  

Legally, businesses operating in the U.S. are subject to regulations and requirements under many jurisdictions, across local, county, state, and federal levels. Legal business requirements are often tied to the location and structure of the business, which then determine obligations around taxation, business IDs, registration, and permits.

Choosing a Business Location

The location—that is, the neighborhood, city, and state—in which a business operates will have an impact on many different aspects of running the business, such as the applicable taxes, zoning laws (for brick-and-mortar, or physical locations), and regulations.

A business needs to be registered in a certain location; this location then determines the taxes, licenses, and permits required. Other factors to consider when choosing a location might include:

• Human factors : Such as the target audience for your business, and preferences of business owners and partners around convenience, knowledge of the area, and commuting distance
• Regulations and restrictions : Concerning applicable jurisdictions or government agencies, including zoning laws
• Regionally specific expenses : Such as average salaries (including required minimum wages), property or rental prices, insurance rates, utilities, and government fees and licensing
• The tax and financial environment : Including income tax, sales tax, corporate tax, and property tax, or the availability of tax credits, incentives, or loan programs

Picking a Business Structure

The structure of a business should reflect the desired number of owners, liability characteristics, and tax status. Because these have legal and tax compliance implications, it’s important to fully understand and choose a business structure carefully and, if necessary, consult a business counselor, lawyer, and/or accountant.

Common business structures include:

• Sole proprietorship : An unincorporated business that has just one owner, who pays personal income tax on profits
• Partnership : Options include a limited partnership (LP) or a limited liability partnership (LLP)
• Limited liability company (LLC) : A business structure that protects its owners from personal responsibility for its debts or liabilities
• Corporation : Options include a C corp , S corp , B corp , closed corporation , or nonprofit

Getting a Tax ID Number

A tax ID number is like a Social Security number for a business. Whether or not a state and/or federal tax ID number is required for any given business will depend on the nature of the business, as well as the location in which the business is registered.

If a business is required to pay state taxes (such as income taxes and employment taxes), then a state tax ID will be necessary. The process and requirements around state tax IDs vary by state and can be found on individual states’ official websites. In some situations, state tax IDs can also be used for other purposes, such as protecting sole proprietors against identity theft.

A federal tax ID, also known as an employer identification number (EIN) , is required if a business:

• Operates as a corporation or partnership
• Pays federal taxes
• Wants to open a business bank account
• Applies for federal business licenses and permits
• Files employment, excise, alcohol, tobacco, or firearms tax returns

There are further situations in which a business might need a federal tax ID number, specific to income taxation, certain types of pension plans, and working with certain types of organizations. Business owners can check with the Internal Revenue Service (IRS) about whether they need an EIN.

Registering a Business

Registration of a business will depend on its location and business structure, and can look quite different depending on the nature and size of the business. 

For example, small businesses may not require any steps beyond registering their business name with local and state governments, and business owners whose business name is their own legal name might not need to register at all. However, registration can include personal liability protection as well as legal and tax benefits, so it can be beneficial even if it’s not strictly required. 

Most LLCs, corporations, partnerships, and nonprofits are required to register at the state level and will require a registered agent to file on their behalf. Determining which state to register with can depend on factors such as:

• Whether the business has a physical presence in the state
• If the business often conducts in-person client meetings in the state
• If a large portion of business revenue comes from the state
• Whether the business has employees working in the state

If a business operates in more than one state, it may need to file for foreign qualification in other states in which it conducts business. In this case, the business would register in the state in which it was formed (this would be considered the domestic state), and file for foreign qualification in any additional states.

Some businesses may decide to register with the federal government if they are seeking tax-exempt status or trademark protection, but federal registration is not required for many businesses.

Overall registration requirements, costs, and documentation will vary depending on the governing jurisdictions and business structure.

Obtaining Permits

Filing for the applicable government licenses and permits will depend on the industry and nature of the business, and might include submitting an application to a federal agency, state, county, and/or city. The SBA lists federally regulated business activities alongside the corresponding license-issuing agency, while state, county, and city regulations can be found on the official government websites for each region.

Every business should have a marketing plan that outlines an overall strategy and the day-to-day tactics used to execute it. A successful marketing plan will lay out tactics for how to connect with customers and convince them to buy what the company is selling. 

Marketing plans will vary according to the specifics of the industry , target market, and business, but they should aim to include descriptions of and strategies around the following:

• A target customer : Including market size, demographics, traits, and relevant trends
• Unique value propositions or business differentiators : Essentially, an overview of the company’s competitive advantage with regard to employees, certifications, or offerings
• A sales and marketing plan : Including methods, channels, and a customer’s journey through interacting with the business
• Goals : Should cover different aspects of the marketing and sales strategy, such as social media follower growth, public relations opportunities, or sales targets
• An execution plan : Should detail tactics and break down higher-level goals into specific actions
• A budget : Detailing how much different marketing projects and activities will cost

The startup costs for any given business will vary greatly depending on the industry, business activity, and product or service offering. Home-based online businesses will usually cost less than those that require an office setting to meet with customers. The estimated cost can be calculated by first identifying a list of expenses and then researching and requesting quotes for each one. Use the SBA’s startup costs calculator for common types of expenses associated with starting a small business.

Entrepreneurs seeking to start their own business should fully research and understand all the legal and funding considerations involved, conduct market research, and create marketing and business plans. They will also need to secure any necessary permits, licenses, funding, and business bank accounts.

Startup capital can come in the form of loans, grants, crowdfunding, venture capital, or self-funding. Note that the federal government does not provide grant funding for the purposes of starting a business, although private sources do.

Business plans are comprehensive documents that lay out the most important information about a business. They are important references for the growth, development, and decision-making processes of a business, and financial institutions as well as potential investors and partners generally request to review them in advance of agreeing to provide funding or work together.

Starting a business is no easy feat, but research and preparation can help smooth the way. Having a firm understanding of the target market, competition, industry, business goals, business structure, funding requirements, tax and operating regulations, and marketing strategy, and conducting research and consulting experts where necessary, are all things that entrepreneurs can do to set themselves up for success.

U.S. Small Business Administration. “ Market Research and Competitive Analysis .”

U.S. Small Business Administration. “ Write Your Business Plan .”

U.S. Small Business Administration. “ Loans .”

U.S. Small Business Administration. “ Fund Your Business .”

U.S. Small Business Administration. “ Pick Your Business Location .”

U.S. Small Business Administration. “ Choose a Business Structure .”

U.S. Small Business Administration. “ Get Federal and State Tax ID Numbers .”

Internal Revenue Service. “ Do You Need an EIN? ”

U.S. Small Business Administration. “ Register Your Business .”

U.S. Small Business Administration. “ Apply for Licenses and Permits .”

U.S. Small Business Administration. “ Marketing and Sales .”

U.S. Small Business Administration. “ Grants .”

• Terms of Service
• Editorial Policy
• Privacy Policy
• Your Privacy Choices

By clicking “Accept All Cookies”, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts.

How to Start a Business: A Startup Guide for Entrepreneurs [Template]

Updated: September 12, 2023

Published: September 07, 2023

Learning how to start a business is no small task, but it’s necessary if you want to successfully get your venture off the ground. To help, I've put together a complete guide that walks you through the steps of starting a business.

hbspt.cta._relativeUrls=true;hbspt.cta.load(53, '1a0a4e5a-b3ce-4c8b-bc42-4e24cde930ae', {"useNewLoader":"true","region":"na1"});

The guide covers every requirement to start a business: from the paperwork and finances to creating your business plan and growing your business online. At the bottom, you’ll find a library of the best free tools and resources to start selling and marketing your products and services.

Use the links below to navigate to each section of the guide.

What Do You Need to Start a Business?

How to start a business, how to start a business plan, how to decide on a company name.

• How to Choose a Business Structure

How to Register Your Business

How to comply with legal requirements, how to find funding for your new business, how to create a brand identity for your new business, tips for starting a business, resources to start a business, how to start a business online.

Let's get started.

Free Business Plan Template

The essential document for starting a business -- custom built for your needs.

• Outline your idea.
• Pitch to investors.
• Secure funding.
• Get to work!

You're all set!

Click this link to access this resource at any time.

Fill out the form to access the template.

• Business Plan: Your plan is a document that provides in-depth detail about your business and its short- and long-term strategies.
• Business Name: Your name is what you’ll call your company on all official documentation and licenses.
• Business Structure: Your structure refers to the type of leadership and ownership your business will operate under.
• Business Registration: Your registration is a credential with state authorities that allows your business to operate legally.
• Legal Requirements: Your other legal requirements include business licenses and permits beyond the initial registration.
• Funding: Your sources of funding refer to business grants, loans, and personal savings.
• Branding: Your branding refers to the unique identity and image you create for your business.

Every budding entrepreneur wants more visitors, more qualified leads, and more revenue. But starting a business isn't one of those “if you build it, they will come” situations. So much of getting a startup off the ground has to do with timing, planning, and the market, so consider if the economic conditions are right to start a company and whether you can successfully penetrate the market with your solution.

In order to build and run a successful company , you'll also need to create and fine-tune a business plan, assess your finances, complete all the legal paperwork, pick your partners, research apps for startups growth, choose the best tools and systems to help you get your marketing and sales off the ground … and a whole lot more.

This process may feel overwhelming, so we’ll walk you through it step-by-step. But first, let’s summarize what we’ve just learned.

Requirements for Starting a Business

To summarize, the requirements for starting a business are:

• A business plan
• A business name
• An ownership or business structure
• A business registration certificate
• A legal license or seller’s permit (as well as other legal documents)
• A source of funding
• A brand identity

Without these elements in place, you unnecessarily risk your new business’s future.

Now that you know what you need, let’s go over the basic steps for starting a business.

• Write a business plan.
• Choose a business name.
• Choose an ownership structure.
• Register your business.
• Review and comply with legal requirements.
• Apply for funding.
• Create a brand identity.

Having a great business idea is only part of the journey. In order to be successful, you’ll need to take a few steps to get it off the ground. In order to refine your business idea and set yourself up for success, consider doing the following:

1. Write a business plan.

Your business plan maps out the details of your business, including how it’s structured, what product or service you’ll sell, and how you’ll be selling it. Creating a business plan will help you find any obstacles on the horizon before you jump into running a business.

Recommended Reading:

• What is a Business Plan? Definition, Tips, and Templates
• How to Build a Detailed Business Plan That Stands Out
• How to Write an Ecommerce Business Plan
• How to Become an Entrepreneur With No Money or Experience

70 Small Business Ideas for Anyone Who Wants to Run Their Own Business

Jump to: How to Start a Business Plan →

Featured Resource: Free Business Plan Template

Grab your free business plan template here .

2. Choose a business name.

Your business name is an essential part of your new business. It determines what you’ll call it on official documentation and on the business plan you’ll share with investors. Because your name will stem off your business plan and offerings, it’s best to create it after you’ve written a plan.

• How to Come Up With a Brand Name
• 100+ Business Name Ideas to Inspire You [+7 Brand Name Generators]
• How to Trademark a Business Name: A 5-Step Guide

Jump to: How to Decide on a Company Name →

3. Choose an ownership structure.

Your business’ legal structure can impact what you’re liable for and the taxes you pay. The most common types of business structures are sole proprietorship, partnership, limited liability company, and corporation. In the process of starting a business, you’ll need to choose the most appropriate one for you.

• The Types of Business Structures and How to Choose
• Sole Proprietorship 101: The Easy Guide to Setting One Up
• Sole Proprietorships vs. LLCs
• What Is a Privately Held Company?
• What’s an LLP? Limited Liability Partnerships Explained in Under 5 Minutes

Jump to: How to Choose an Ownership Structure →

4. Register your business.

Registering your business is the next step after choosing an ownership structure. That way, you can ensure you’re operating within the most essential legal constraints.

• How to Register a Business — Everything You Need to Get Started
• How to Register a Business Name
• Best and Worst States to Start a Business In
• How to Register Your Website’s Domain (For Free)

Jump to: How to Register Your Business →

Free Business Startup kit

9 templates to help you brainstorm a business name, develop your business plan, and pitch your idea to investors.

• Business Name Brainstorming Workbook
• Business Plan Template
• Business Startup Cost Calculator

5. Review and comply with legal requirements.

In addition to choosing a legal structure and registering your business, there are other requirements to follow to ensure your business is operating legally, including acquiring any business licenses and permits. Licensure requirements depend on industry — for instance, if you’re planning to found a construction firm, you’ll need the appropriate construction permits.

• Startup Costs for Entrepreneurs
• The Entrepreneur’s Guide to Business Expenses Lists
• 5 Things Every Marketer Should Know About Compliance
• Understanding Business Risk

Jump to: How to Comply with Legal Requirements →

6. Apply for funding.

When you’re starting a small business, getting loans from family and friends may suffice. However, larger ventures will require more capital.

Startup funding is essential regardless of the type of business you’re creating. Whether you leverage loans, grants, or family and friends, having solid funds will allow you to more effectively and economically launch your business.

• Startup Funding: What It Is, How It Works, & 5 Tips for Landing It
• 37 Funding Resources for Black-Owned Businesses
• How to Find Investors: A Guide for Entrepreneurs
• How Do Business Loans Work

Jump to: How to Find Funding for Your New Business →

7. Create a brand identity.

Once you have the first six steps squared away, you can focus on developing a unique brand identity for your business. Key components include your brand personality and experience, as well as visual elements like your logo, color palette, typography, imagery and graphic elements, and more.

• What is Branding?
• Brand Identity: How to Develop a Unique & Memorable Brand
• Brand Strategy 101: 7 Important Elements of a Company Branding Plan
• 21 Brand Style Guide Examples of Visual Inspiration
• Everything You Need to Know About Brand Experience

Jump to: How to Create an Identity for Your New Business →

As evidenced by this list, starting a business involves a whole lot of moving pieces, some more exciting than others. Brainstorming business names? Fun! Filing taxes? ... Not so fun. The trick to successfully getting your business off the ground is to meticulously plan and organize your materials, prioritize properly, and stay on top of the status and performance of each one of these moving parts.

From registering with the government to getting the word out about your business to making key financial decisions, you'll need to take a wide range of steps to start a successful business.

Now that we’ve gone over an overview of the steps, let’s go over each one in detail.

Back to Top ↑

• Use a business plan template.
• Narrow down what makes you different.
• Keep it short.
• Write an executive summary.
• Describe your company and business model.
• Analyze your market's conditions.
• Explain your product and/or service.
• Outline all operations and management roles.
• Design a marketing and sales strategy.
• Detail a financial plan with business costs, funding, and revenue projections.
• Summarize the above with an appendix.
• Review section examples for inspiration.

Having a solid business plan can help your business stay on track, especially when obstacles arise. But before we go over the steps of writing one, let’s answer an essential question first: What exactly is a business plan?

A business plan is a living document that maps out the details of your business. It covers what your business will sell, how it will be structured, what the market looks like, how you plan to sell your product or service, what funding you'll need, what your financial projections are, and which permits, leases, and other documentation will be required.

At its core, a business plan helps you prove to yourself and others whether your business idea is worth pursuing. It's the best way to take a step back, look at your idea holistically, and solve for issues years down the road before you start getting into the weeds.

Below are the key elements in a business plan template , details about what goes into each of them, and example sections at the bottom. You’ll also learn tips for writing a business plan .

1. Use a business plan template .

Before you begin your business plan, download this business plan template . It provides an outline for you to follow and simplifies the process.

The first steps are to create a cover page, and write a description of your business that outlines your product or service and how it solves a need for your customers. The next step is to work on the company description, which provides detail on how your company will be organized and includes the mission statement.

In the next section of the business plan template, you'll identify your target audience or buyer personas. Through research, surveys, and interviews, you‘ll understand who wants your product, why they’re interested, and what problem your offering solves for them.

The next step is to describe your line of products and services in detail, including the pricing model, and the advantage you have over competitors.

From there, you‘ll write down your plan to market and sell your product or service. You’ll also identify your growth plan and set targets and measures for your marketing and sales activities.

Then, you'll determine which legal structure your business will have (LLP, sole proprietorship, etc.), and if there are any other legal factors you need to consider (e.g., permits, licenses, health codes).

Finally, financial projections will be made, and short-term and long-term goals will be set for the business.

2. Narrow down what makes you different.

Before you start whipping up a business plan, think carefully about what makes your business unique first. If you‘re planning to start a new athletic clothing business, for example, then you’ll need to differentiate yourself from the numerous other athletic clothing brands out there.

What makes yours stand out from the others? Are you planning to make clothing for specific sports or athletic activities, like yoga or hiking or tennis? Do you use environmentally friendly material? Does a certain percentage of your proceeds go to charity? Does your brand promote positive body image?

Understanding your brand's positioning in the market will help you generate awareness and sales.

Remember: You‘re not just selling your product or service — you’re selling a combination of product, value, and brand experience. Think through these big questions and outline them before you dive into the nitty-gritty of your business plan research.

3. Keep it short.

Business plans are more short and concise nowadays than they used to be. While it might be tempting to include all the results of your market research , flesh out every single product you plan to sell, and outline exactly what your website will look like, that's actually not helpful in the format of a business plan.

Know these details and keep them elsewhere, but exclude everything but the meat and potatoes from the business plan itself. Your business plan shouldn't just be a quick(ish) read — it should be easy to skim, too, like the example below.

Now that we’ve gone over the first essential steps of building your business plan, it’s time to jump into the creation process.

4. Write an executive summary.

The purpose of the executive summary is to give readers a high-level view of the company and the market before delving in to the details.

Pro Tip : Sometimes it‘s helpful to write the executive summary after you’ve put together the rest of the plan so you can draw out the key takeaways more easily.

The executive summary should be about a page long. It should cover:

• Overview : Briefly explain what the company is, where you‘ll be located, what you’ll sell, and who you'll sell to.
• Company Profile : Briefly explain the business structure, who owns it and what prior experience/skills they'll bring to the table, and who the first hires might be.
• Products or Services : Briefly explain what you'll sell.
• The Market : Briefly explain your main findings from your market analysis and product market fit .
• Financial Considerations : Briefly explain how you plan to fund the business and what your financial projections are.

Featured Resource: Executive Summary Template

5. Describe your company and business model.

Next, you‘ll have your company description. Here’s where you have the chance to provide the following information:

• A summary of what your company does
• A mission statement
• A description of your business structure and business owner
• A description of your location
• A list of the marketplace needs that your business is trying to meet
• A detailed account of how your products or services actually meet those needs

6. Analyze your market's conditions.

One of the first questions to ask yourself when you‘re testing your business idea is whether it has a place in the market. The market will ultimately dictate how successful your business will be. What’s your target market , and why would they be interested in buying from you?

Get specific here. For example, if you‘re selling bedding, you can’t just include everyone who sleeps in a bed in your target market. You need to target a smaller group of customers first, like teenagers from middle-income families.

From there, you might answer questions like:

• How many teenagers from middle-income families are currently in your country?
• What bedding do they typically need?
• Is the market growing or stagnant?

Include both an analysis of research that others have done, as well as primary research that you've collected yourself — whether by customer surveys, interviews, or other methods.

This is also where you‘ll include a competitive analysis. In our example, we’d be answering the question: how many other bedding companies already have a share of the market, and who are they?

Outline the strengths and weaknesses of your potential competitors, as well as strategies that will give you a competitive advantage.

Featured Resource: Market Analysis Templates

Download 10 Free Competitive Analysis Templates

7. Explain your product and/or service.

Here‘s where you can go into detail about what you’re selling and how it benefits your customers. If you aren‘t able to articulate how you’ll help your customers, then your business idea may not be a good one.

Start by describing the problem you're solving. Then, go into how you plan to solve it and where your product or service fits into the mix. Finally, talk about the competitive landscape: What other companies are providing solutions to this particular problem, and what sets your solution apart from theirs?

8. Outline all operations and management roles.

Use this section to outline your business' unique organization and management structure, while keeping in mind that you may change it later. Who will be responsible for what? How will tasks and responsibilities be assigned to each person or each team?

Includes brief bios of each team member and highlight any relevant experience and education to help make the case for why they‘re the right person for the job. If you haven’t hired people for the planned roles yet, that's OK — just make sure you identify those gaps and explain what the people in those roles will be responsible for.

9. Design a marketing and sales strategy.

This is where you can plan out your comprehensive marketing and sales strategies that‘ll cover how you actually plan to sell your product. Before you work on your marketing and sales plan, you’ll need to have your market analysis completely fleshed out, and choose your target buyer personas, i.e., your ideal customers. (Learn how to create buyer personas here .)

On the marketing side, you'll want to cover answers to questions like:

• How do you plan to penetrate the market?
• How will you grow your business?
• Which channels will you focus on for distribution?
• How will you communicate with your customers?

On the sales side, you'll need to cover answers to questions like:

• What's your sales strategy ?
• What will your sales team look like, and how do you plan to grow it over time?
• How do you plan to scale for growth ?
• How many sales calls will you need to make to make a sale?
• What's the average price per sale?

Speaking of average price per sale, you'll want to go into your pricing strategy as well.

Featured Resource: Marketing & Sales Alignment Template

Download the Free Marketing & Sales SLA Template

10. Detail a financial plan with business costs, funding, and revenue projections.

Outline your financial model in detail, including your start-up cost, financial projections, and a funding request if you're pitching to investors.

Your start-up cost refers to the resources you‘ll need to get your business started — and an estimate of how much each of those resources will cost. Are you leasing an office space? Do you need a computer? A phone? List out these needs and how much they’ll cost, and be honest and conservative in your estimates. The last thing you want to do is run out of money.

Once you‘ve outlined your costs, you’ll need to justify them by detailing your financial projections. This is especially important if you're looking for funding for your business. Make sure your financial model is 100% accurate for the best chance of convincing investors and loan sources to support your business.

11. Summarize the above with an appendix.

Finally, consider closing out your business plan with an appendix. The appendix is optional, but it's a helpful place to include your resume and the resume(s) of your co-founder(s), as well as any permits, leases, and other legal information you want to include.

12. Review section examples for inspiration.

Let’s go over examples of the sections in a business plan, so that you have an idea of how to approach your own. We’ll use a business plan for a fictional art supply store named NALB Creative Center .

Executive Summary Example

“NALB Creative Center (NCC) is the place where artists meet. NALB is an acronym for “No Artist Left Behind,” with our company by-line stating: “Live Your Art.” NCC is a specialty retail store offering a large array of artists’ materials and supplies, crafters’ needs, a gallery, and an education center. NCC will provide a pleasant facility that will inspire and support amateurs, professionals and crafters in the Big Island art community. NALB will sponsor art shows and competitions, art and craft fairs, scholarships for artists to continue their formal education, and other community events. NALB will facilitate, organize and offer creative workshops and classes in a variety of techniques and media.”

Company Summary Example

“NALB Creative Center is a startup, to go into business in the summer of this year. We will offer a large variety of art and craft supplies, focusing on those items that are currently unavailable on this island. The Internet will continue to be a competitor, as artists use websites to buy familiar products. We will stock products that artists don't necessarily have experience with. We will maintain our price comparisons to include those available online.”

Market Analysis Example

“In West Hawaii, the mauka community of Holualoa in Kona, Kealakekua and South Kona, as well as Waimea and Hawi in Kohala are three communities with large artist populations and galleries. In West Hawaii, the Holualoa Foundation for Arts and Culture, the Society for Kona’s Education and Art, the Kailua Village Artists, the Kona Arts Center, the Waimea Arts Center and other well-established non-profit groups offer arts classes and instruction in various media year-round to children and adults.

“NALB Creative Center will market to four primary customers:

• Professional artists.
• Amateur artists and crafters, including hobbyists.
• Businesses, such as architects, graphic designers, interior designers, or direct mail advertisers.
• Teachers and students.”

Products and Services Example

“NALB Creative Center will provide a wide variety of products of interest to artists and crafters. Our wholesale suppliers will include: Grumbacher, Liquitex, Windsor and Newton, Mabef Easels, Duncan, PrismaColor, Speedball, Masterpiece, Fredrix, Holbein, Rembrandt, and Strathmore. Vendors will include MacPherson and Herr’s. There are thousands of products available, we will offer many that are unusual, or new, as well as the basics that every artist needs on a regular basis. We will offer lines to include bargain, mid-range and professional quality products.”

Personnel Plan Example

“NCC will be operated in the first few years by the owners. Additional part-time help will be provided by family members. As NALB grows over the next years, we will need two additional full-time sales clerks, and two part-time clerks. This will free the owners to concentrate on building the business, and expanding into the other areas of NALB’s vision (tours, competitions, music, gallery, special events, etc.).”

Marketing Plan Example

“Our marketing strategy will focus heavily on customer service with loyalty and retention in sales; on sales promotion, and on niche positioning in the market.

“In addition to price and item promotional announcements, NALB Creative Center will focus its marketing efforts via several key direct-to-consumer advertising vehicles:

“Local and Regional Magazine Publications: (West Hawaii Today, Hilo Tribune-Herald, Hawai’i Island Journal). Each of these papers provide a demographic base that lines up nicely with that of NALB’s.

“Direct Mail Postcards: NALB will look to increase consumer awareness, retain the existing customer base and promote increased sales via postcard mailings. These mailings will be targeted around special events, and are intended to liquidate slow moving products or showcase vendor negotiated specials.”

Free Marketing Plan Template

Outline your company's marketing strategy in one simple, coherent plan.

• Pre-Sectioned Template
• Completely Customizable
• Example Prompts
• Professionally Designed

Financial Plan Example

“The growth of NALB will be moderate and the cash balance will always be positive.

• Being a retail environment, we will not be selling on credit. We will accept cash, checks, Visa and MasterCard.
• Marketing and advertising will remain at or below 5% of sales.
• We will finance growth mainly through cash flow. We recognize that this means we will have to grow slowly.
• It should be noted that the owners of NALB Creative Center do not intend to take any profits out of the business until the long-term debt has been satisfied. Whatever profits remain after the debt payments will be used to finance growth, mainly through the acquisition of additional inventory.”

Check out more business plan examples here .

After you create your business plan, you will likely have a good idea of your business’s strengths, weaknesses, opportunities, and threats . You can therefore strategically create a name for your business that differentiates you from your competition, while still making it clear what you offer to customers and prospects.

That’s why creating a business name often comes after you create your plan.

Naming your business is a little more complicated than making a list and picking your favorite. If you‘re using a name other than your personal name, then you need to register it with your state government so they know you’re doing business with a name other than your given name.

To that end, here’s how to decide on a business name and register it with the appropriate authorities.

1. Brainstorm business name ideas .

Strategically choosing the right business name starts with a traditional brainstorming session. For some businesses, this may be a simple, straightforward process, such as simply choosing “[city name] + [service]”, i.e. Atlanta Dentist. This is a good idea for local businesses because it will ensure you’re more visible in local search results.

However, you might want to come up with a unique brand name if you’re running an innovative startup or otherwise launching a business that would benefit from a unique name. No matter what, we recommend coming up with a short, memorable name that’s easy to say and simple to write.

2. Conduct a trademark search.

Next, do a trademark search of your desired name to avoid expensive issues down the road. The search will tell you if another business has registered or applied for the name you'd like to use. Remember: A trademark owner can sue you on reasonable grounds if you use their trademark unlawfully.

3. Make sure the name you want is available in your state.

Before you register, you need to make sure the name you want is available in your state. Business names are registered on a state-by-state basis, so it‘s possible that a company in another state could have the same name as yours. This is only concerning if there’s a trademark on the name.

4. Make sure the domain name is available online.

During the name choosing process, you’ll want to envision how the name will look like as a website domain . That’s an easy way to test whether the name is short and memorable enough for someone to recite the website address off the top of their head. For instance, “Carlo’s Homemade Chocolate & Sweets” might sound like a good idea, but that translates to carloshomemadechocolate.com, and that’s not even the full name.

After you’ve envisioned the name as a domain, it’s time to check domain name registrars for availability. There’s nothing worse than coming up with a great business name, and then having to get an adjusted domain, such as “businessname-1.com”, “business-name.com”, or “therealbusinessname.com”. While these aren’t poor choices, it’s best to stick to “businessname.com” for readability and memorability.

Once you’ve found a name that suits you and is available in an unaltered state, register your domain name to ensure no one gets it before you do.

6. File for a trademark if you've chosen an original name.

If you’d like, you can trademark your business name for extra protection. A trademark protects words, names, symbols, and logos that distinguish goods and services. Filing for a trademark costs less than $300, and you can learn how to do it here .

7. Register your business name (optional).

You likely won’t need to take an additional step to register your business name . Most times, it will happen automatically.

If you are a new corporation or LLC, your business name will automatically be registered with your state when you register your business, so you don't have to go through a separate process. There are rules for naming a corporation and LLC, which you can read about here .

If you are a sole proprietorship, partnership, or existing corporation or LLC, register a “Doing Business As” (DBA) name if you want to do business with a name other than your registered name . You can do so either by going to your county clerk office or with your state government, depending on which state you're in. Learn how to do that here .

If you’re confused about the LLC, corporation, and partnership stuff, not to worry. These are called business structures, and they determine how your business operates from the top-down. Below, we cover how to choose between them.

How to Choose an Ownership Structure

Choosing an ownership structure, also known as your business legal structure or business entity, is one of the key legal requirements you’ll need to fulfill when starting your business.

The four most common business structures are:

1. Sole Proprietorship

A sole proprietorship is a business that‘s owned and run by one person, where the government makes no legal distinction between the person who owns the business and the business itself. It’s the simplest way to operate the business. You don‘t have to name your business anything other than your own, personal name, but if you want to, you can give it its own distinctive name by registering what’s called a Doing Business As (DBA) name.

A freelance graphic designer running their own business without additional help or with legally outsourced work.

• It‘s easy and inexpensive to create a sole proprietorship because there’s only one owner.
• The owner has complete control over all business decisions.
• Tax preparation is also simple, since a sole proprietorship is not taxed separately from its owner.
• It can be dramatically more difficult to raise money and get investors or loans because there's no legal structure that promises repayment if the business fails.
• Since the owner and the business are legally the same, the owner is personally liable for all the debts and obligations of the business.

How Taxes Work

The individual proprietor owns and manages the business and is responsible for all transactions, including debts and liabilities. Income and losses are taxed on the individual's personal income tax return at ordinary rates. In addition, you are also subject to payroll taxes, or self-employment taxes, on the money you earn. Find IRS tax forms here .

Questions to Determine If It’s Right For You

Will you be the only employee, at least for the foreseeable future?

✅ If yes, this is an excellent option for you.

Are you all right with assuming full liability for the business?

✅ If so, this is a good choice. If not, consider an LLC or corporation instead, which will afford you more protection if the business fails.

2. Partnership

A partnership is a single business where two or more people share ownership, and each owner contributes to all aspects of the business, including shares in the profits and losses of the business.

Multiple doctors maintaining separate practices in the same building.

• It‘s generally pretty easy to form a business partnership, and it doesn’t tend to be super expensive, either.
• Having two or more people equally invested in the business' success allows you to pool resources.
• You’ll have access to more than one person's skillset and expertise.
• Just like a sole proprietor, partners have full, shared liability if the business goes south. Note : There is a variant on partnerships called a limited liability partnership, or LLP, that protects against that.
• Partners aren't just liable for their own actions, but also the actions of their partner(s).
• When more than one person is involved in decisions, there‘s room for disagreement — which means it’s important to have an explicit agreement over how the obligations and earnings will be split.

To form a partnership, you have to register your business with your state, a process generally done through your Secretary of State's office. You will also need to file self-employment taxes for each partner. Find IRS tax forms here .

Will you be founding the business with any other person, including a family member?

✅ If yes, this is an excellent option for you. A partnership structure is especially beneficial if the other stakeholder is a family member, so that no one goes back on their word.

Are you all right with assuming half liability for the business?

✅ If so, this is a good choice. If not, consider an LLP (limited liability partnership), LLC, or corporation instead, which will afford you more protection if the business fails.

Do you consider yourself to have strong conflict resolution and collaborative skills?

✅ Working in a team and resolving conflicts is an essential aspect of starting a business with a partner. If you’re more of a lone wolf, consider a sole proprietorship instead.

3. Limited Liability Company (LLC)

Limited liability companies (LLCs) are a type of business structure that‘s more complex than sole proprietorships and partnerships, but less complex than corporations. They are called "pass-through entities" because they’re not subject to a separate level of tax.

Most states don't restrict ownership on LLCs, and so members can include individuals, corporations, and even other LLCs and foreign entities. Most states also permit “single-member” LLCs — those having only one owner.

A small design firm owned by one president and staffed by multiple designers and other employees.

• Owners of an LLC have limited liability, meaning that they personally are not responsible for any financial or legal faults of the business. This reduction in risk is what makes an LLC a very popular business structure.
• They‘re simpler to operate than a corporation because they aren’t subject to as many formalities and regulations.
• LLCs are often more complex than sole proprietorships or partnerships, which means higher initial costs.
• Certain venture capital funds are hesitant to invest in LLCs because of tax considerations and the aforementioned complexity.

LLCs have the benefit of a “flow-through” tax treatment, meaning that the owners — not the LLC — are the ones who are taxed. Having only one level of tax imposed makes taxes easier. Find IRS tax forms here .

Would you prefer to be held minimally liable for the business and its financial outcomes?

✅ If so, an LLC is an excellent choice to protect your personal assets and finances. This is a good choice even if you’re starting a freelance business on your own.

Do you have the budget to pay LLC fees?

✅ LLC registration fees aren’t high, but they’re still an additional expense your business will need to budget for.

4. Corporation

A corporation is a legal entity that is separate and distinct from its owners, and has most of the rights and responsibilities that an individual possesses (to enter into contracts, loan and borrow money, sue and be sued, hire employees, own assets, and pay taxes). It‘s more complex than the other business structures, and it’s generally suggested for larger, established companies with multiple employees.

Microsoft, Coca-Cola, Toyota Motor, and almost all well-known businesses.

• They make seeking venture financing easy.
• They provide the best protection for personal assets.
• Founders, directors, and stockholders are (usually) not liable for the company‘s debts and obligations — only the money and resources they’ve personally invested.
• Because they're much more complex than other business structures, they can have costly administrative fees.
• They have more complicated tax and legal requirements.

Corporations are required to pay federal, state, and in some cases, local taxes. There are two different types of corporations: “C corporations” and “S corporations.” C corporations are subject to double taxation. Any profit a C corporation makes is taxed to the corporation when earned, and then is taxed to the shareholders when distributed as dividends.

The corporation does not get a tax deduction when it distributes dividends to shareholders. Shareholders cannot deduct any loss of the corporation, but they are also not responsible directly for taxes on their earnings — just on the dividends they give to shareholders.

S corporations, on the other hand, have only one level of taxation. Learn more about the difference between “C corporations” and “S corporations” here , and find IRS tax forms here .

Have you secured enough venture capital to scale your small business into a full corporation?

✅ Corporations can start small, but they need to have enough funds to grow. If you have a list of investors who’ve invested $1M+ in your small business, then it may be time to think about becoming a corporation.

Do you have an internal accounting team that can handle tax matters?

✅ The tax requirements for corporations can be complicated, which requires the expertise of dedicated accountants. If you have a team or are planning to start one, a corporation may be right for you.

Once the business plan, business name, and business structure is in place, you get to move on to the even less romantic part — the paperwork and legal activities. This includes things like registering with the government, and — depending on your business structure and industry — getting a tax code, a business license , and/or a seller's permit.

We go into more detail about how to register your business here . In summary, you’ll want to take the following steps to register your business:

Step 1: Pick your state of domicile.

Where are you operating? Georgia? New York? Choose the state where your business location will operate from.

Step 2: Register your business name.

Business name registration is automatic when you register as an LLC or sole proprietorship. Remember that you can always choose a DBA (Doing Business As) name.

The registration authority will vary by state. For instance, in Georgia, you register your business at the Department of Revenue, while in New York state, you register at the Department of State. Be sure to find the appropriate registration authority of your state.

Step 3: Apply for an Employer Identification Number (EIN), if needed.

You’ll need to apply for an Employer Identification Number if you’re not running a sole proprietorship or a single-member LLC. Otherwise, the IRS will use your personal SSN for tax purposes.

Step 4: Fulfill other legal requirements.

These may include obtaining a business license or a seller’s permit.

Below, you'll find an explanation of what goes into that last step, along with links to helpful resources where you can dig into the details. (Note: These steps are for fulfilling legal requirements for a business in the U.S. only.)

Businesses are regulated on the federal, the state, and sometimes even local level. It‘s important to check what’s required on all three of those levels. Your business won't be a legal entity without checking these boxes, so it’s essential to fulfill them all.

1. Get a seller’s permit, if needed.

Image Source

If your business sells tangible property to the public either as a wholesaler or retailer, then in most states, you need to apply for a seller‘s permit. ’Tangible property‘ simply means physical items, like clothing, vehicles, toys, construction materials, and so on. In some states, a seller’s permit is required for service-oriented business, too, such as accountants, lawyers, and therapists.

The seller‘s permit allows you to collect sales tax from buyers. You’ll then pay that sales tax to the state each quarter by putting the sales tax permit number on the state's tax payment form.

You can register for a seller‘s permit through your state’s Board of Equalization, Sales Tax Commission, or Franchise Tax Board. To help you find the appropriate offices, find your state on this IRS website .

Alternatively, search for “seller’s permit [state name]” to find out how to apply at your local office.

2. Apply for a federal business license, if needed.

Almost every business needs some form of license or permit to operate legally — but the requirements vary, which can get confusing. Which specific licenses or permits does your business need? This is determined mainly by what industry you’re in. For example, construction firms need a contractor’s license.

To figure out if your business needs a specific license, go to this SBA.gov website and select the state from which you‘re operating your business. It’ll tell you the specific license and permit requirements in that state.

3. Apply for state licenses.

Most states have specific licensure requirements for occupying a retail space, operating out of a warehouse, and even operating out of your home. According to Chase Bank , these can include:

• Operating licenses
• Building permits
• Zoning and land use permits
• Signage licenses

Keep in mind that these requirements will vary by state. For instance, in Georgia, you’ll need an Occupational Tax Certificate if you have a brick-and-mortar store, while in New York state, you’ll need a General Vendor license, even if you don’t have a physical store.

4. Apply for professional licenses and renew them.

Some fields require a professional license, which are separate from the federal business licenses you use to operate legally. Rather, this type of license ensures that you’re qualified to provide the services you’re advertising.

Professionals that may need a license include:

• Hair stylists
• Insurance agents
• Real estate agents

Be sure to double-check the requirements with your state, and remember to renew your license every year.

5. Understand small business tax requirements.

Business owners are obligated to pay specific federal taxes, and the amount of those taxes is determined by the business entity that you establish. All businesses except for partnerships need to file an annual income tax return. Partnerships file what's called an information return .

As mentioned, a business that‘s owned and operated as an LLC or corporation needs an Employer Identification Number (EIN), which you can apply for on the IRS’ website here . Even if you operate as a sole proprietor under your SSN, you’ll still need to play self-employment tax.

Once you‘re registered, it’s time to figure out which taxes you'll be responsible for. Here are the three types:

Self-Employment Tax (SE Tax)

Self-employment tax refers to a Social Security and Medicare tax for people who work for themselves, i.e. business owners. SE taxes require filing Schedule SE (Form 1040) if your net earnings from self-employment were $400 or more. (Note: There are special rules and exceptions for fishing crew members, notary publics, and more.)

You can learn more here .

Employment Tax

When you have employees, you (as the employer) have certain employment tax responsibilities that you need to pay, as well as forms you need to file. Employment taxes include Social Security and Medicare taxes, federal income tax withholding, and federal unemployment (FUTA) tax.

Excise taxes are also something you need to consider, depending on what you sell, where you operate, and so on. For example, in the U.S., there's a federal excise tax on certain trucks, truck tractors, and buses used on public highways.

Let’s summarize what we’ve learned about the legal requirements to start a business.

Legal Requirements to Start a Business

• Pick your state of domicile.
• Register your business name.
• Apply for an Employer Identification Number (EIN).
• Get a seller’s permit.
• Apply for a federal business license.
• Apply for state licenses.
• Apply for professional licenses and renew them.
• Understand small business tax requirements.

From the day you start building your business until the point where you can make a consistent profit, you need to finance your operation and growth with start-up capital. Some founders can finance their business entirely on their own dime or through friends and family, which is called “bootstrapping.”

This obviously gives the business owners a ton of flexibility for running the business, although it means taking on a larger financial risk — and when family's involved, it can lead to awkward holiday dinner conversations if things go wrong.

Many founders need external start-up capital to get their business off the ground . If that sounds like you, keep on reading to learn about the most common kinds of external capital you can raise.

1. Seed Financing

If you're looking for a relatively small amount of money, say, the investigation of a market opportunity or the development of the initial version of a product or service, then Seed financing might be for you.

There are many different kinds of seed financing, but the one you've probably heard of most is called Seed-round financing. In this case, someone will invest in your company in exchange for preferred stock. If your company gets sold or liquidated, then investors who hold preferred stock often have the right to get their investment back — and, in most cases, an additional return, called “preferred dividends” or “liquidation preferences” — before holders of common stock are paid.

2. Accelerator

Accelerators are highly competitive programs that typically involve applying and then competing against other startups in a public pitch event or demo day. In addition to winning funding and seed capital, winners of these programs are also rewarded with mentorship and educational programs.

Although accelerators were originally mostly tech companies and centered around Silicon Valley, you can now find them all over the country and in all different industries. If this sounds like something you'd be interested in, here's a list of the top accelerators in the United States to get you started.

3. Small Business Loan

If you have a really rock-solid plan for how you'll spend the money in place, then you might be able to convince a bank, a lender, a community development organization, or a micro-lending institution to grant you a loan.

There are many different types of loans , including loans with the bank, real estate loans, equipment loans, and more. To successfully get one, you‘re going to need to articulate exactly how you’ll spend every single penny — so make sure you have a solid business plan in place before you apply. You can learn more about SBA.gov's loan programs here .

4. Crowdfunding

You might ask yourself, what about companies that get funding through platforms like Kickstarter and Indiegogo? That's called crowdfunding, which is a newer way of funding a business.

More importantly, it typically doesn‘t entail giving partial ownership of the business away. Instead, it’s a way of getting funding not from potential co-owners, but from potential fans and customers who want to support the business idea, but not necessarily own it.

What you give donors in exchange is entirely up to you — and typically, people will come away with early access to a product, or a special version of a product, or a meet-and-greet with the founders. Learn more about crowdfunding here .

5. Venture Capital Financing

Only a very small percentage of businesses are either fit for venture capital or have access to it. All the other methods described earlier are available to the vast majority of new businesses.

If you're looking for a significant amount of money to start your company and can prove you can quickly grow its value, then venture capital financing is probably the right move for you.

Venture capital financing usually means one or more venture capital firms make large investments in your company in exchange for preferred stock of the company — but, in addition to getting that preferred return as they would in series seed financing, venture capital investors also usually get governance rights, like a seat on the Board of Directors or approval rights on certain transactions.

VC financing typically occurs when a company can demonstrate a significant business opportunity to quickly grow the value of the company but requires significant capital to do so.

When you‘re first starting a business, you’ll need to build the foundation for a strong brand identity. Your brand identity is about your values, how you communicate concepts, and which emotions you want your customers to feel when they interact with your business. Having a consistent brand identity to promote your business will make you look more professional and help you attract new customers.

Here’s what you need to do to develop your brand identity:

1. Design a logo.

Creating the right logo for your business requires careful thought and consideration. It should be representative of your brand's purpose and target audience, while also being memorable and distinct from competitors.

To start, you need a deep understanding of your business's mission, values, and target audience. Think beyond what your company does and truly examine why you do what you do, and who you do it for. This knowledge will serve as the foundation for your logo.

Consider conducting market research and identifying current logo trends can help you understand what works well for others and strategize on how to stand out. Then, start brainstorming design ideas that showcase what makes your business unique. For instance, you could try writing out a list of words that best describe your business and what makes it special, and then use those words as inspiration to start sketching ideas and concepts.

Once you have some sketches created, pick which ones you think are the best and share them with stakeholders, colleagues, and buyer personas to gather feedback and refine your design. After narrowing down a design, you’ll want to test its versatility and scalability to ensure it works well in different sizes and formats.

2. Develop a visual identity.

Your brand’s visual identity doesn’t stop at creating a logo — you’ll also need to establish guidelines for typography, color palette, imagery, and other graphic elements. The more consistent your brand is with its visuals, the more consumers will be able to recognize and trust it.

To get started, consider creating a brand mood board. Ask yourself: What kind of emotions do you want your brand to evoke? Is there a specific visual aesthetic that you want to emulate? This can help you gather visual inspiration that resonates with your brand.

Choose your color palette and typography wisely. Spend some time researching color theory , as color can have a major impact on how people perceive your brand. Make sure your typography is readable and looks good across different sizes and formats. Additionally, you should create other visual assets such as patterns, shapes, illustrations, and icons that pair well with your color palette and typography.

3. Craft a tagline.

In just a few words, your tagline should encapsulate your brand’s essence and communicate its value. Think of it as a written or verbal version of your logo. Both elements are created to immediately capture the attention of your audience. Even if consumers don’t remember anything about your product or service, they will remember a catchy tagline.

When crafting your tagline, keep it simple. You want your tagline to be memorable, so aim for a short phrase and focus on key benefits or unique aspects of your brand. Also consider utilizing techniques like alliteration, rhyme, or play on words to make your tagline stand out — just make sure it aligns with the rest of your brand’s voice and tone.

4. Develop your voice and tone.

Your brand voice refers to the personality that your brand adopts in its communication with its audience. It provides direction on what to say and how to say it, allowing you to differentiate yourself and cut through the noise. A well-defined brand voice helps create a distinct and memorable identity for your brand, allowing you to connect with your target audience on a deeper and more meaningful level.

When determining the appropriate voice and tone for your brand, remember that consistency is key. Ensure that your brand voice and tone align with your brand‘s values, mission, and positioning. Alignment between your brand’s personality and its communication style is crucial for building trust and authenticity.

It’s also important to be mindful of how you use language. Adapt your voice and tone to suit the preferences and understanding of your audience. Additionally, use emotion and storytelling techniques to engage your audience and resonate with them.

5. Create brand guidelines.

Once you determine all of the previously mentioned brand elements, establish a set of brand guidelines that communicate how to appropriately use them. Having these rules and standards set in place ensure consistent and cohesive messaging and representation for your brand.

Get started by defining the rules for using your brand elements across different channels and applications, such as digital and print media, social media profiles, web design, packaging, and any other relevant materials.

Show practical examples of correct and incorrect usage scenarios to demonstrate the do‘s and don’ts of brand representation. This helps stakeholders and users understand the guidelines and their application. You can also offer your team templates or mock-ups to ensure correct implementation.

Once the brand guidelines are set, distribute them to internal stakeholders and relevant external partners. To make sure everyone’s on the same page, take the time to review the guidelines with everyone and consider conducting training sessions if necessary.

As your brand evolves, so should your brand guidelines. Continuously review and update them to reflect any changes or refinements. Keep the guidelines easily accessible and communicate any updates effectively.

Ready to dive into a life of entrepreneurship? Here are the best tips for becoming successful in your small business niche.

1. Create a customer acquisition strategy.

Once you've registered your new business with the government and gotten the legal paperwork squared away, how do you go about, you know ... acquiring customers ?

Here’s the truth: A new company needs to start drumming up interest for its product or service even before it's ready to ship. But there are a million different platforms and avenues you can use to drive awareness … so where on earth do you start?

It all comes down to your target customer. You won‘t be able to acquire customers without knowing who they are. One of the very first questions you need to ask yourself is: Who wants what I’m selling? Who would find it useful? Who would love it?

To create a strong customer acquisition strategy, you’ll need to narrow down your target audience as much as possible.

2. Narrow down your target customer.

To find your target customer , you need to dig in to whom that person is and what kind of messaging would resonate with them. Using research, surveys, and interviews, try to find out:

• Their backgrounds, interests, goals, and challenges
• How old they are
• What they do every day
• Which social platforms they use

And much more.

Creating very specific buyer personas can dramatically improve your customer acquisition efforts. Read this step-by-step guide on how to create buyer personas , which includes buyer persona templates you can customize yourself. Once you've picked a buyer persona or two, print them out, tack them onto your wall, and think about their interests and needs before making every business decision.

3. Build your online presence.

With your target customer and your brand identity under your belt, you can begin building the core marketing elements of your small business, which includes your website, your blog, your email tool, your conversion tool, and your social media accounts. To dive deeper into these topics, read our beginner's guide to small business marketing here .

4. Generate and nurture leads.

Once you‘ve started building an online presence and creating awareness for your business, you need to generate the leads that will close into customers. Lead generation is the process of attracting and converting strangers and prospects into leads, and if you build a successful lead generation engine, you’ll be able to keep your funnel full of sales prospects while you sleep.

What does a successful lead generation process look like? Learn more about lead generation here , and don’t forget to try HubSpot's free marketing tools , our free lead generation tool that lets you track your website visitors and leads in a single contact database.

5. Set up your sales infrastructure.

By taking the time to set up your sales process from the get-go, you‘ll avoid painful headaches that come with lost data down the line. Start with a CRM, which is a central database where you can keep track of all your clients and prospective clients in one place. There are loads of options out there, and you’ll want to evaluate the CRMs that cater to small businesses . (Excel doesn't count!)

6. Identify your sales goals.

Don't get intimidated by sales lingo such as KPIs and ROI. All this means is that you need to figure out what you need to make ends meet and grow: how much revenue do you need, and how many products do you need to sell to hit that target?

7. Hire a sales rep.

When you‘re starting your business, it’s tempting to do everything yourself, including taking on sales. However, making that first sales hire is crucial to scaling — you need someone dedicated to understanding your buyer and selling to them full-time. When looking for that first sales hire, seniority should be less of a priority than how much sales experience they have on the front lines and whether they understand your business‘ target buyer. From there, you’ll want a plan for building your sales development team .

8. Get more out of your sales activities.

Efficiency is key. Put together a sales process, such as this helpful 7-step sales process framework , which works regardless of your business size. You'll also want to automate sales tasks (such as data entry), or set up notifications when a prospective customer takes an action. That way, you spend less time poring through records and calling the wrong prospects and more on strategy and actual selling.

9. Keep your customers happy.

Getting new customers in the door is important, but retaining them is just as important. You can‘t ignore customers once you’ve closed them — you have to take care of them, give them stellar customer service, and nurture them to become fans of (and even evangelists for) your business.

While inbound marketing and sales are both critical to your funnel, the funnel doesn‘t end there: The reality is that the amount of time and effort that you spend perfecting your strategy in those areas will amount to very little if you’re unable to retain happy customers.

This means that building a model for customer success should be central to your organization.

Think for a second about all the different ways reviews, social media, and online aggregators spread information about your products.

They're all quick and effective, for better or for worse. While your marketing and sales playbooks are within your control and yours to perfect, a large chunk of your prospects are evaluating your company based on the content and materials that other people are circulating about your brand.

10. React quickly to customer issues.

People expect fast resolution times (some faster than others depending on the channel), so it‘s essential to be nimble and efficiently keep up with requests so that you’re consistently providing excellent service to avoid losing trust with your customers.

Pay attention to the volume of your company mentions on different channels. Identify where your customers spend the most time and are asking the most questions, and then meet them there, whether it's on a social network, on Yelp, or somewhere else.

11. Keep track of touchpoints with individual customers.

Interactions with your customers are best informed by context. Keep track of all the touchpoints you've had with individual customers, because having a view into their experience with your company will pay dividends in the long run.

How long have they been a customer? What was their experience in the sales process? How many purchases have they made? Have they given positive/critical feedback about your support experience or products? Knowing the answers to these questions will give you a more complete picture when you respond to inquiries and will help you have more productive conversations with customers.

12. Create feedback loops.

From the moment you have your first customer, you should be actively seeking out insights from them. As your business grows, this will become harder — but remember that your customer-facing employees are a valuable source of information because they are most in tune with your buyers and potential buyers.

13. Create a FAQ page on your website.

Give customers the tools to help themselves, and scale this program as you grow. When you're starting out, this might take the form of a simple FAQ page. Over time, as your customer base grows, turn your website into a resource for your customers and enable them to self-service — such as evolving that FAQ page into a knowledge base or library that answers common questions and/or gives customers instructions.

Here are some helpful resources to help you spread awareness, build your online presence, and get the leads you need for free. In addition, we’ve listed additional templates and sales tools to help you build an efficient sales engine, reach prospects, and close customers for free.

• The Ultimate Inbound Guide for Start-Ups : A guide that covers how to build an inbound sales and marketing machine, which demand generation activities offer the biggest return on investment, and more.
• HubSpot's Free Marketing Tools : Free marketing tool that gives you insight into what every lead does before and after they fill out a form. It includes built-in analytics that make it easy to learn which pages, offers, and traffic sources are driving the most conversions for you.
• Website Grader : Enter your website URL and email address, and you‘ll get a detailed grade on your website’s performance, mobile, SEO, and security, along with detailed tips and resources for making impactful improvements on your website.
• Press Release Templates : Downloadable press release templates you can customize, along with a corresponding guide to building a press release and promotion plan.
• Case Study Templates : Downloadable case study templates you can customize, tips on how to find and reach out to candidates, and sample interview questions.
• Content Creation Templates : 100 social media image templates, 8 PowerPoint presentation templates, 50 call-to-action templates, 15 infographic templates, 5 ebook templates, 5 blog post templates, and more.
• Email Signature Generator : A free tool that creates a professional email signature you can easily add to your Gmail, Outlook, Apple Mail, Yahoo Mail, or any other email provider.
• Sales Email Templates : A list of email templates that have been used with tremendous success by real companies (including HubSpot).
• Sales Call Scripts : Easy-to-follow sales call scripts that can help you build rapport and develop trust, understand the prospect's pain points, identify key decision-makers, and secure a follow-up meeting.
• Daniel Pink's “Sell Like a Human” Video Series : Monthly video series where Sales Expert Daniel Pink and special guests solve your biggest sales challenges in under 30 minutes.
• Sales Close Rate Industry Benchmarks Tool : Compare your sales close rate against your industry competitors using data from over 8,900 companies segmented by 28 industries.

Additional Resource: Enroll in HubSpot Academy to learn everything you need to know about digital marketing and sales for small business. Train your whole team for free!

Starting a business online is a little different from starting a traditional business. Here are some important steps for starting and scaling your business online.

1. Determine your niche and business idea.

Your business niche is your target focus area for your product or service. It’s important to choose a niche because customers like brands and businesses that specifically cater to their needs. Most customers are more likely to purchase products or services from a brand that provides personalized experiences.

When determining your niche and business idea, first identify your target audience and specify everything from their age to their interests. Then, use that information to figure out their principal need. If your product doesn’t resolve a specific need, your business will fail to get off the ground.

2. Conduct market research.

Conduct market research to understand what product or service you should offer, whom you should serve, and where you face the stiffest competition. From physical goods to digital downloads, understanding your target market and competitors will help you determine how to best position your product.

Your research should help you create a strong selling proposition . In other words, what makes your business unique? Why should someone buy from you?

3. Learn online business laws.

While online businesses may require fewer licenses and permits than traditional businesses, there are still legal requirements that you will need to adhere to. Be sure to check:

• What kind of business license (if any) do you need to start operations?
• What legal structure makes the most sense for your company?
• Are there any permits that you need to obtain?
• Are there any inspections that you need to pass?
• Do you need a sales tax license?
• Are there any specific regulations applicable to online businesses only?
• What are the laws regarding hiring contractors and hiring employees?

4. Create a website.

After handling the research, taking care of legalities, and honing in your products or services, it is time to create your website . When creating your website, you will need to choose a strong ecommerce platform that will allow you to sell products online.

5. Set up shop.

Once your website is complete, it’s time to add products or services to your store. When adding your products, pay attention to product images and descriptions. Having a crisp image and a detailed but concise description will help your audience maneuver your website smoothly.

After you have finished setting up your store, it’s critical to ensure you offer a seamless shipping or delivery experience to your buyers. For example, you can use HubSpot to manage quality control before you ship products out.

Finally, you want to make sure everything is working before you hit the live button on your website. Make sure that everything is clickable and that all pages look good across all devices and browsers. Once you’ve checked that, you are ready to go live.

6. Grow your business.

You’ve created an awesome product and now it’s time to get the word out. In other words, it’s time to grow your audience. There are numerous ways to reach your target customer, including:

• Social media : Use hashtags and paid ads to expand your reach.
• Influencer marketing : Send free samples to “celebrities” in your niche.
• Facebook groups : Connect with your target market on this platform.
• Google advertising : Put your products in front of people all over the web.
• Content marketing : Publish blog posts to bring organic traffic to your site.
• Word-of-mouth : Encourage customers to spread the word.
• YouTube videos : Start a channel to showcase your products.

Next Steps: Getting Ready to Launch Your Business

Being a small business owner isn’t easy, but with the right plan, you can set up your business for success. Be sure to check and know your requirements, have a solid business plan, and submit your legal paperwork before you take your business live. Once you have a solid business plan and the financing to execute your goals, you'll be well on the path to launching a successful enterprise.

Editor's note: This post was originally published in August 2019 and has been updated for comprehensiveness.

Don't forget to share this post!

Related articles.

How to Write a Business Proposal [Examples + Template]

Product Differentiation and What it Means for Your Brand

Amazon Affiliate Program: How to Become an Amazon Associate to Boost Income

The 25 Best PayPal Alternatives of 2023

The First-Mover Advantage, Explained

Intrapreneurship vs. Entrepreneurship: What's the Difference?

What Are Current Assets? Definition + Examples

The Straightforward Guide to Value Chain Analysis [+ Templates]

• Credit cards
• View all credit cards
• Banking guide
• Loans guide
• Insurance guide
• Personal finance
• View all personal finance
• Small business
• View all small business

You’re our first priority. Every time.

We believe everyone should be able to make financial decisions with confidence. And while our site doesn’t feature every company or financial product available on the market, we’re proud that the guidance we offer, the information we provide and the tools we create are objective, independent, straightforward — and free.

So how do we make money? Our partners compensate us. This may influence which products we review and write about (and where those products appear on the site), but it in no way affects our recommendations or advice, which are grounded in thousands of hours of research. Our partners cannot pay us to guarantee favorable reviews of their products or services. Here is a list of our partners .

How to Write a Business Plan, Step by Step

Many or all of the products featured here are from our partners who compensate us. This influences which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money .

1. Write an executive summary

2. describe your company, 3. state your business goals, 4. describe your products and services, 5. do your market research, 6. outline your marketing and sales plan, 7. perform a business financial analysis, 8. make financial projections, 9. add additional information to an appendix, business plan tips and resources.

A business plan is a document that outlines your business’s financial goals and explains how you’ll achieve them. A strong, detailed plan will provide a road map for the business’s next three to five years, and you can share it with potential investors, lenders or other important partners.

Here’s a step-by-step guide to writing your business plan.

» Need help writing? Learn about the best business plan software .

This is the first page of your business plan. Think of it as your elevator pitch. It should include a mission statement, a brief description of the products or services offered, and a broad summary of your financial growth plans.

Though the executive summary is the first thing your investors will read, it can be easier to write it last. That way, you can highlight information you’ve identified while writing other sections that go into more detail.

» MORE: How to write an executive summary in 6 steps

Next up is your company description, which should contain information like:

Your business’s registered name.

Address of your business location .

Names of key people in the business. Make sure to highlight unique skills or technical expertise among members of your team.

Your company description should also define your business structure — such as a sole proprietorship, partnership or corporation — and include the percent ownership that each owner has and the extent of each owner’s involvement in the company.

Lastly, it should cover the history of your company and the nature of your business now. This prepares the reader to learn about your goals in the next section.

» MORE: How to write a company overview for a business plan

The third part of a business plan is an objective statement. This section spells out exactly what you’d like to accomplish, both in the near term and over the long term.

If you’re looking for a business loan or outside investment, you can use this section to explain why you have a clear need for the funds, how the financing will help your business grow, and how you plan to achieve your growth targets. The key is to provide a clear explanation of the opportunity presented and how the loan or investment will grow your company.

For example, if your business is launching a second product line, you might explain how the loan will help your company launch the new product and how much you think sales will increase over the next three years as a result.

In this section, go into detail about the products or services you offer or plan to offer.

You should include the following:

An explanation of how your product or service works.

The pricing model for your product or service.

The typical customers you serve.

Your supply chain and order fulfillment strategy.

Your sales strategy.

Your distribution strategy.

You can also discuss current or pending trademarks and patents associated with your product or service.

Lenders and investors will want to know what sets your product apart from your competition. In your market analysis section , explain who your competitors are. Discuss what they do well, and point out what you can do better. If you’re serving a different or underserved market, explain that.

Here, you can address how you plan to persuade customers to buy your products or services, or how you will develop customer loyalty that will lead to repeat business.

» MORE: R e a d our complete guide to small business marketing

If you’re a startup, you may not have much information on your business financials yet. However, if you’re an existing business, you’ll want to include income or profit-and-loss statements, a balance sheet that lists your assets and debts, and a cash flow statement that shows how cash comes into and goes out of the company.

You may also include metrics such as:

Net profit margin: the percentage of revenue you keep as net income.

Current ratio: the measurement of your liquidity and ability to repay debts.

Accounts receivable turnover ratio: a measurement of how frequently you collect on receivables per year.

This is a great place to include charts and graphs that make it easy for those reading your plan to understand the financial health of your business.

» NerdWallet’s picks for setting up your business finances:

The best business checking accounts .

The best business credit cards .

The best accounting software .

This is a critical part of your business plan if you’re seeking financing or investors. It outlines how your business will generate enough profit to repay the loan or how you will earn a decent return for investors.

Here, you’ll provide your business’s monthly or quarterly sales, expenses and profit estimates over at least a three-year period — with the future numbers assuming you’ve obtained a new loan.

Accuracy is key, so carefully analyze your past financial statements before giving projections. Your goals may be aggressive, but they should also be realistic.

List any supporting information or additional materials that you couldn’t fit in elsewhere, such as resumes of key employees, licenses, equipment leases, permits, patents, receipts, bank statements, contracts and personal and business credit history. If the appendix is long, you may want to consider adding a table of contents at the beginning of this section.

How Much Do You Need?

Here are some tips to help your business plan stand out:

Avoid over-optimism: If you’re applying for a business loan at a local bank, the loan officer likely knows your market pretty well. Providing unreasonable sales estimates can hurt your chances of loan approval.

Proofread: Spelling, punctuation and grammatical errors can jump off the page and turn off lenders and prospective investors, taking their mind off your business and putting it on the mistakes you made. If writing and editing aren't your strong suit, you may want to hire a professional business plan writer, copy editor or proofreader.

Use free resources: SCORE is a nonprofit association that offers a large network of volunteer business mentors and experts who can help you write or edit your business plan. You can search for a mentor or find a local SCORE chapter for more guidance.

The U.S. Small Business Administration’s Small Business Development Centers , which provide free business consulting and help with business plan development, can also be a resource.

On a similar note...

How to Start a Business in 2024: A 10-Step Guide

Starting a business involves planning, doing market research, and acquiring knowledge of the legal aspects of opening a firm. You’ll answer questions like, “How do I find a product to sell?” “What’s the right business model?” “What are the best channels for marketing?”

Let’s go over the key steps on how to start a business , including creating a business plan, registering your company, promoting your offering, and more.

Start selling online now with Shopify

1. Choose a business idea

It all begins with an idea. Many small business ideas are available for you to pursue, including ventures you can run from home. 

• 26 Best Small Business Ideas to Start This Year
• List of The Most Popular Online Business Ideas
• 17 Unique Business Ideas for First-Time Entrepreneurs
• 10 Profitable Home Business Ideas You Can Start Today

2. Research your product and audience

Upfront research is necessary to determine whether there’s an audience for your business or product idea.

• How to Define Your Target Market and Target Audience
• The Marketing Research Process in 6 Steps
• How to Do a Competitive Analysis + Example Template
• How to Create a Product Validation Spreadsheet

3. Write a business plan

A business plan helps you get clear on how to manage key aspects of the business. It includes everything from your executive summary to your financials.

• How to Write a Business Plan: Step by Step Guide
• How to Write a Lean Business Plan: A Detailed Guide
• Free Business Plan Template & Examples for Startups
• The 7 Best Business Plan Examples to Inspire Your Own

4. Make or source products

If your product is a handmade item, you can choose an appropriate space in your home to carry out its production. If it’s designed to be manufactured in a factory, you’ll likely need to find a supply partner.

• 13 Things to Make and Sell Online: Go DIY Today
• How Do I Find Reliable Manufacturers Near Me or Abroad?
• 6 Best Dropshipping Suppliers and How to Choose
• 10 Best Print-on-Demand Companies and Sites

5. Develop a brand  

A strong brand is crucial for building trust with customers and the wider audience.

• Online Store Names: Ideas, Generators, Tips, And Examples  
• How to Develop Your Brand Voice: Guide + Examples
• A Guide to Brand Storytelling [Free Worksheet]
• 15 Examples of Brand Guidelines and Tips to Make Your Own

6. Build a website

A website lets you introduce your business to the world, and it’s easy to create one thanks to website builders like Shopify’s.

• How to Build a Website for Beginners
• 9 Best Website Builders for Small Business
• 8 Popular Types of Websites You Can Create
• 43 Amazing Ecommerce Website Design Examples

7. Register your business  

In most countries, you will need to officially register your business. Check with your local government agency to clear any doubts.

• The 4 Most Popular Types of Businesses and How to Choose One
• How to Register a Business in 6 Steps: A Guide
• How To Get a Business License in 3 Simple Steps
• How To Get Business Insurance in 6 Simple Steps

8. Manage your money

Getting a grip on finances is important for streamlining your business operations. This involves everything from opening a business bank account to choosing accounting software.

• Choosing the Right Bank for Your Business: 8 Things To Know
• Why Bookkeeping is Essential for Your Online Business
• 8 Best Small Business Accounting Software Picks
• Financial Statement: What Is It and Why It Matters For Your Business

9. Market your business

Marketing is essential to launching a successful business. It’s how you can get products in front of your target audience.

• 5 Organic Marketing Ideas for Entrepreneurs
• Social Media Marketing: A Step-By-Step Guide
• Influencer Marketing: A Comprehensive Guide
• The Ultimate Guide to Experiential Marketing

10. Grow your business

Once your business is up and running, consider taking steps to make it grow. New business owners can take several measures, from seeking additional funding to selling in overseas markets. How to start a business in 2024: summary

• Choose a business idea
• Research your products and audience
• Write a business plan
• Manufacture or source products
• Build a brand
• Create a website
• Register your business
• Manage your money
• Market your business
• Grow your business

Want to learn more?

• How to Get a Small Business Loan
• 10 Best Crowdfunding Websites for Raising Funding
• A Guide to Hiring Virtual Assistants
• 11 Best International Marketplaces for Selling Your Products

Color Combinations Guide: The Ultimate Cheat Sheet (2024)

Choosing the best color combination is an art. We put together a cheat sheet to help ease the stress of picking.

10 WhatsApp Statistics Every Marketer Should Know in 2023 [Infographic]

If you’re anything like me, you probably can’t remember the last day you went without using WhatsApp. Chances are that …

25 Online Jobs That You Can Start in 2024

The way that people earn a living is rapidly changing. We’re seeing more and more individuals embrace online jobs in so…

Oberlo uses cookies to provide necessary site functionality and improve your experience. By using our website, you agree to our privacy policy.