Determining Your Business Structure: LLC, Sole Proprietorship or Inc?
15 April

Determining Your Business Structure: LLC, Sole Proprietorship or Inc?

One of the most critical decisions to make when starting a new business, is choosing the right business structure. There’s a lot of jargon out there that can be quite confusing when it comes to choosing a business structure.

“The business structure you choose influences everything from day-to-day operations, to taxes, to how much of your personal assets are at risk. You should choose a business structure that gives you the right balance of legal protections and benefits.” – sba.gov

With so much riding on which structure you choose, it’s easy to understand the importance of making the right choice. To ensure you make the best decision for your business, there are a few things to keep in mind:

Understand the Differences

First and foremost, you will need to understand the differences between each business structure. You can’t very well decide one or the other is better if you don’t know what each offers or requires.

Should you file as a Limited Liability Company (LLC)? A Non-Profit? A Corporation? What about C-Corp, S-Corp, or B-Corp? How do you know which structure is right?

Start by educating yourself on the details of the most widely-used legal business structures. Sites such as the U.S. Small Business Administration (sba.gov) or the IRS (irs.gov) can offer helpful definitions of each structure.

Identify Your Options

Once you have a basic understanding of the typical structures available to you, you can begin comparing them. Some of the choices will automatically be eliminated (for example – if you’re not forming a business with a partner, you can obviously rule out filing as a Partnership), but others will need a closer look.

Create a small list of the structures which are not ruled out by basic criteria. Even if you may not initially consider one, if your business qualifies, add it to the list for now.

Create a Short List

From here, you can begin to compare and eliminate options. Do this by adding criteria, pros and cons, regulations, and whatever else you discover in your research under each structure on your list. By short-listing the highlights, you will be able to do a side-by-side comparison later on which will help you make the best possible decision for your business.

Be sure to include details in your comparison list such as tax liabilities, company control levels, legal liabilities, and any other form of protection you may need down the road. This will help you to weigh the risk-factors of each structure in terms of protecting your business (and your personal assets) in any future unforeseen issues.

Speak with Established Owners

Another thing to consider when deciding the right structure for your company is the invaluable insight from others who have already gone through it. Speaking with other local business owners, colleagues from a coworking space, or friends and family who have entrepreneurial experience can give you an inside look at things you may not think of by simply doing online searches.

In short, such an important decision is best made with all of the facts and details in mind. The only way to do that is to be thorough in your research and seek the advice of others who have been through the process.

Business Plan Basics: 5 Steps to Your Best Business Plan
1 April

Business Plan Basics: 5 Steps to Your Best Business Plan

When starting your own business, there’s one detail all successful business owners can attest to: create a solid business plan. While this may not be groundbreaking news, your business plan is a crucial step and needs to be taken seriously.

A solid business plan will help you with more than investment pitches (though that is a critical point for most). It will also help you outline everything you’ll need to be successful and will illuminate any potential problem areas.

Creating the detailed plan can be a tedious task but avoid being tempted to rush through it. This piece will be the backbone of all your future business’s endeavors; approach it with commitment.

With your future success riding on a solid business plan, prep work is imperative. To help make this happen, here are 5 steps to your best business plan:

1 – Create a Space

You might be ready to dive into writing, but the very first step should be to create a space. Before you begin your plan, you must make sure you’re prepared to work!

Whether it be a home office, a co-working office space, or an on-site building, you need to have a location that is specifically for working on your future business. Why? Not only does an office space give you a chance to work undistracted, it reaffirms your commitment to future endeavors. By designating a work space for yourself, you’ll be able to cut down on distractions, focus on your commitment to your future success, and get down to business.

2 – Do Your Research

Once you’ve created your working space, it’s time to begin researching. Since a bulk of your business plan will revolve around outlining your intentions, you need to be able to back up your words with action. Research similar businesses, speak with local business owners for tips, and use your research to formulate your intended actions.

3 – Do More Research

When it comes to a business plan, knowledge is key. The more you research, the higher your chances of success. It’s not enough to simply have a dream – you need to be able to make it a reality. You do this by fleshing out an outline of your path. You’ll need to know your market, competitive pricing, thoroughly define what you’re offering and how you’ll stand out from competition.

4 – Business Plan Outline

After you’ve begun your research, create a basic outline of your business plan. You shouldn’t begin writing it entirely, but create a skeleton outline of what to expect. For some, this can come in the form of a generic business plan template. An online search will help you locate one if you’re having trouble and want a basic template for reference. This outline will help you to organize your research and understand what’s needed before beginning your polished plan.

5 – Keep Focused

Lastly, while you want to make sure you have a fantastic business plan to present to potential investors or partners, do not let your determination be swayed by perfection. In other words, no matter how many times you review your plan, know that you’ll likely always find something to tweak, but don’t let that cause you to lose sight of your goals and miss your opportunities. It doesn’t have to be perfect – it just has to be detailed and concise. Stay focused.

“Don’t wait until you think your business plan is perfectly polished and cannot possibly go any further in depth. Otherwise, chances are you will have missed your window of opportunity…” Forbes.com.

Overall, the most important rule to remember when creating a successful business plan is to do thorough research and keep plugging away at it until it’s finished. It all begins with your preparation, so get yourself prepared for success!