Now that you've prepared to launch your business, you're ready to get going! However, the process of getting your company off the ground can be complex. Here are some things you'll need to do to start your business.
The main rule of real estate is location, location, location. The same goes for opening a business. The taxes, zoning laws, and regulations you'll be subjected to all depend on the location you select.1The state, city, neighborhood, and even street address should be a big part of choosing your location.1 Your location should be one that best suits the customers you're targeting. For example, do you want a spot on the main road to serve passers-by? Do you want to be an urban hotspot? Or are you aiming for a more suburban crowd?
Your business name is incredibly important. After all, it's one of the first things your customers will associate with you! However, a business' name isn't always one single name. Business names fall into a few categories, and many companies have more than one. Here are some examples.
This is a legal name for identifying your business. By default, it's used only by your state and protects your business identity at the state level. Your state may also require you to register this name legally with the federal government. However, this depends on your location and ownership structure.2
This is a name other than the entity name that you run your business under. It's also known as a "trade name," "fictitious name," or "assumed name." For example, a business run by a sole proprietor may operate under the name of the shop, rather than the owner's actual name.2Registering one has several benefits. Besides being able to operate under any name you choose, it allows you to do things like open a business bank account.2Like an entity name, you can register a DBA name with the city, state, or county. If you plan on doing business under a name other than your full legal name, you must register a DBA name.3
A domain name is a word or phrase that identifies a website. This is something you should think about regardless of whether you run an online business. In the 21st century, every business needs to have a web presence. We cannot stress this enough. You should register a domain name as soon as you can. Registering a domain has several benefits. For example, it will protect your business name from being used by other companies. It will also protect you against cybersquatting, a practice in which a fraudster uses a misleading domain to trick people into visiting their site. If such a person registers your business name, that could spell bad news for you and your customers. For example, the cloud storage company Dropbox didn't own www.dropbox.com during their earlier years. Someone else registered the domain and used it for their own dubious purposes. You can register a domain at sites such as Google Domains and Bluehost.
Now that you've decided on a location, you should register your business as soon as possible. This will give you a handful of benefits as an owner. For example, you'll get legal protections in case you are ever sued or experience other difficulties. Also, some areas require you to register.4In most cases, you'll need to register with the state before you open. However, this all depends on your current business situation. For example, small businesses only need to register their DBA name with the state and local government in most cases. Sole proprietorships ran under the owner's legal name usually don't need to register at all. On the other hand, more complex companies will need to do a lot more.4 Also, in Illinois, you will have to register with the Department of Revenue and get an IBT number. You can read more about this later in this article. Registration usually comes with a fee, but it's usually under $100. You should include these costs in your starting budget.4
In most cases, you'll need a license or permit before opening. This is often part of the registration process with your state or city. The license you'll need depends on the industry you're working in. For example, a restaurant or café may need restaurant and liquor licenses. Overall, it's a very open-ended part of starting your business. The process of getting licensed varies – along with license fees – based on your business situation and the issuing agency.5Most of the time, you'll have to get licenses from the federal government, as well as your state and possibly city governments. You can find a list of federal licenses here, along with information about each. On the other hand, state and city licenses vary widely. To see a list, check your state or city government website.
In simple terms, a trademark is anything that identifies your business, goods, and services. A trademark can be a word, phrase, photo, graphic, etc. For example, a restaurant may invent unique names for some of its menu items; these are trademarks. Having a trademark protects your business' identity. They help it stay unique and competitive. Because of this, having a trademark is important to keeping your business open. Trademark registration has tons of advantages. For example, if you register your business name as a trademark, it will become officially recognized by the federal government. Registration also gives you stronger legal protections against infringements.6To register a trademark with the U.S. Patent and Trademark Office (USPTO), it will have to pass a few tests. If it doesn't pass, the USPTO will refuse it. To read more about this in detail, check out this page on the USPTO's website.
Before you choose any trademark, check the USPTO's database to make sure it's not registered already. Being sued for infringement can be expensive.
The law requires that every company with employees have an Employer Identification Number (EIN). Your EIN serves as a federal tax ID, letting your business itself pay state and federal taxes. Businesses must pay taxes too, not just individuals, so your EIN is like a business social security number. You can get an EIN by applying with the IRS.7Businesses in Illinois also need an Illinois Business Tax number (IBT). You get an IBT when you register your business with Illinois Department of Revenue. For more info, check out this page.8
Finally, before you open, you should get a business bank account and look for business insurance. Having these things protect your business legally and financially. A business account gives you and your customers several benefits. One example, it separates your business assets from your personal ones, gives your customers purchase protection, and gives a more professional image.9As for business insurance, having it can be incredibly important to your company. When you form a company like an LLC, you get several protections. However, these only protect your personal property. Insurance protects your business property as well. As a business owner, you may run into unexpected costs, and without insurance, they could force you to close.10Depending on your situation, you may also have to buy other types of insurance. For example, if you have employees, you must have worker's compensation, unemployment, and disability insurance. Your state may require you to have additional types as well.10You can read more about business accounts here. If you'd like to read more about the different types of business insurance and how to get them, check out this page.
Now that you’ve read about launching your business, learn about properly running it in the next article. Also, you can get region-specific assistance from the Illinois Department of Commerce if you need it while setting up your business