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Understanding the steps to starting a business

Starting a business may be a lifelong dream for many or an exciting opportunity for others. Regardless of what has brought the new entrepreneur to the point of starting a new business, it is important that they understand the basic steps involved in the process of starting a new business. Both financial and legal considerations will have to be carefully evaluated and decided upon during the process of starting a new business.

The first important step of starting a business is to write a business plan. There are many elements of a business plan but it is important to remember that a business plan serves as a guide to how the business will be started and run smoothly and successfully. Secondly, it is important to obtain necessary advice and guidance which is available through a number of difference resources for entrepreneurs starting their own businesses. Deciding on appropriate financing is another important step for a new business owner to research, consider and secure.

The next step in the process is for the entrepreneur to choose a location that is best for the business. A number of important considerations are implicated by the decision concerning where to locate the business such as zoning laws. The next significant decision a new entrepreneur will make concerns the type of business form they want to use for their business. Business formation is an important consideration to be evaluated carefully because it has important governance, tax and liability implications which should be carefully made and considered based on the needs and goals of the business. Potential business forms include a sole proprietorship, partnership, limited liability company or corporation, as well as others.

Finally, it is important to properly register the business according to local laws, comply with applicable tax laws, obtain any required licenses or permits and understand employment laws. Starting a business is an exciting opportunity for many new entrepreneurs which is why understanding how to properly set up the business, including legal steps and requirements, can help set the business up for a long and successful future.

Source: U.S. Small Business Administration, "10 Steps to Starting a Business," Accessed Oct. 1, 2015

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