Setting Up A Business
People starting a new business for the first time obviously need help in setting up a business. There are several factors that need to be considered such as deciding on the name of the business, and getting it registered as such, obtaining required licenses, and getting IRS clearance, apart from developing estimates and projections, getting required quotations for equipment, identifying the office premises or manufacturing unit location, recruiting required personnel, and raising required finance, etc.
Obviously, it is confusing to decide which of these should be decided before the other. The first step would be to develop project cost and project cash flows from it. For this, the business owner needs to obtain quotations and cost details. Developing such estimates with the help of a qualified finance professional is advisable because there may be finance related factors, which the business owner may have overlooked. Any flaws in estimates become obvious at this point of time.
Finance professionals are also aware of various finance options available in the market, and they can help the new entrepreneur in coming up with means of financing as well. In addition, the finance professional would advise the entrepreneur on which business structure would be most advisable for the proposed project. Therefore, the entrepreneur can identify whether or not the project is feasible at this stage itself. If not, then the only loss that the entrepreneur incurs is towards the fees of the finance professional, and may be some traveling expenses to different places to negotiate cost of machinery, or properties, etc.
Presuming the finance professional found the project to be feasible, the next step would be to identify a place from where the business operations are to be carried out. Obviously, business should have a separate office, unless it is a home based business, or a very small business.
After negotiating the terms and conditions for lease, if at all, the entrepreneur can start the process of confirming availability of proposed name of the business. While this is in progress, the entrepreneur can identify suppliers, and possible markets. Once the availability of name is confirmed, the entrepreneur can complete the incorporation procedures, and simultaneously, apply for tax department registration. In the United States, it is the IRS with which the business needs to be registered.
After receiving required licenses under corporation act, and IRS code, the entrepreneur can start the activities such as recruiting personnel, approaching the banks for finance, placing purchase orders for machinery and materials, arranging for any computers, telephones, and so on. If the business is a large business, entrepreneur may take assistance from professionals. Even accounts personnel may be needed. However, for setting up a small business, the entrepreneur can use several of the accounting packages that are available as freeware online. Similarly, if it is a small business, the entrepreneur can consider joining hands with another business complimentary to it, so that establishment expenses can be brought down.