Starting a Business Checklist

Starting a business checklist

The steps in this checklist for establishing a business can help you take your business from concept to successful launch.

1. Assess your business idea

Before investing any time or funds into your new business, clearly define and assess your business idea. Consider whether your idea meets a consumer need and accessible customer base, as well as how competitive or popular that market is.

To answer these questions, a mentor within the industry or field can provide helpful advice and insight. They can also connect you to other professionals who may be beneficial in starting your business.

2. Conduct market research

Market research builds on your business idea by closely analyzing information about potential customers and businesses in your area. In this stage, you’ll define a selling point and buyer persona that details your business’ potential for success. Consider how saturated the current market is and what makes your idea stand out from competitors.

To research your market, search for market-related keywords and your planned business location online. Consider aspects such as branding and targeted consumers to see if there’s space for your business. For example, if your town has several gyms but lacks a yoga studio, there could be a place for you to break into the local fitness industry.

3. Develop a business plan

A detailed business plan is crucial for taking your business idea from a concept to a tangible and successful business and guiding you through key stages and elements. It can also help you acquire funding, investors or business partners, as these parties want to see an actionable plan for how you’ll use their resources and become profitable.

There are many business plans formats, but they all generally include these elements:

Executive summary
Company description
Market analysis
Business and management structure
Service or product offered
Marketing and sales plan
Funding requirements
Financial projections
Appendix

4. Get funding

Your funding strategy is one of the most important choices as a new business owner. Depending on your personal financial circumstances and business vision, common funding options include:

Self-funding: Using financial resources from savings, retirement accounts or support from friends and family
Investors: Investors provide funding in exchange for ownership shares
Loans: Banks and credit unions issue small business loans to eligible borrowers
Crowdfunding: People contribute funds to a business concept in return for a gifted product, recognition or other thanks

5. Find a business location

Finding a business location is a strategic step that determines regulations, zoning laws and taxes your business is subject to. Business expenses can vary depending on the region’s average salary, property values , rental rates and minimum wage laws, and business operations may be subject to restrictive zoning ordinances. Consider aspects such as your target market’s accessibility, sidewalk traffic, parking, square footage and competitor locations.

6. Determine your business name

Create a name that reflects your business’ identity, vision and goods or services. Once you determine a business name that is memorable, suitable and not already trademarked, register it to protect it and avoid future expenses or legal issues.

Name registrations include:

Entity name
Trademark
Doing business as (DBA)
Domain name

7. Choose a business structure

The type of business entity you form determines the tax income return forms you file and impacts your personal liability and business registration requirements.

Common business structures include:

Sole proprietorship
Partnership
Limited liability company (LLC)
Corporation
S corporation
Cooperative

8. Register your business

Depending on your business’ location and structure, you may need to register it with federal, state or local agencies. You usually don’t need to register with the federal government if your business operates under your legal name, but LLCs, tax-exempt or corporations must generally complete certain filings. Even if you aren’t required to register, small businesses can benefit from registering’s personal liability protection and legal and tax benefits.

9. Get federal and state tax IDs

Similarly to a Social Security number, an Employer Identification Number (EIN) lets your business pay federal taxes, open a business bank account, apply for licenses and permits and hire employees. Applying for an EIN is a free online service through the Internal Revenue Service (IRS).

State ID requirements and income and employment taxes vary. Check with your state’s website to understand your obligations as a business owner.

10. Set up business insurance

Business insurance can reduce the financial risk of starting a small business. The type of insurance your business needs depends on its operations, but common types include:

General liability insurance
Commercial property insurance
Business income insurance
Workers’ compensation insurance
Data breach insurance

11. Apply for licenses and permits

Depending on your business activities and location, your small business will likely need a combination of federal and state licenses and permits. Federal licenses are required if federal agencies regulate your business activities, and each state, country or city tends to have unique regulations. Requirements and fees for licenses and permits vary.

12. Open a business bank account

Open a business bank account as soon as your business starts spending or receiving money to stay legally compliant and protected.

In addition to separating business funds from personal funds and offering personal liability protection, a business bank account provides benefits such as purchasing power through credit cards or a line of credit, merchant services accounts to accept customer transactions and authorizing banking tasks to employees on the business’ behalf.

13. Hire employees

If your business requires employees to operate, start building a team. This means creating job descriptions, advertising job postings and interviewing applicants. Look for individuals with the enthusiasm and relevant skills to help launch and grow your business.

Remember the legal and tax obligations of hiring employees under the IRS, Fair Labor Standards Act and state regulations. All payrolled employees should typically complete Form I-9 and Form W-4, as well as other new hire forms.

14. Set up accounting

An accounting system is necessary to keep business finances organized and compliant with state and federal tax laws. Determine whether you’ll calculate your taxable income based on a calendar or fiscal year , and create a system for filing company financial statements and reports. Hiring a professional or getting accounting software can help ensure accounting efficiency and accuracy.

15. Acquire supplies, tools and other needs

Research and acquire the supplies and equipment you’ll need to operate your business, such as:

Furnishings
Computers, tablets and other technology
Phones
Business or industry-specific software
Production materials
Internet services

16. Create a branding and marketing plan

One of the final steps of starting a business checklist is promoting your business. Develop your business’ brand and marketing strategy based on your target audience and buyer persona. This plan includes developing a digital marketing and SEO strategy and creating a logo and promotional materials that give your business an identity and set it apart from competitors.

17. Create a website

Significant customer traffic comes from search engine queries, which means a website and social presence are crucial for any new business. Register a web domain and social media accounts that represent your brand and design them with professional written and media content to increase awareness and promote your brand.

Starting a Business Checklist