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Tips for Starting a New Business

Below are some tips for starting a new business. Business owners that have been running your own business for less than 3 years may also want to review these.

  • Write a business plan. Business plans are extremely helpful because they force the business owner to formulate for how they will start and run their business. Do not get caught up on the length of the business plan. However, it should include a break-even analysis, a profit-loss forecast and a cash-flow analysis.
  • Utilize your own money as much as possible. Funding start up costs with your own money is preferable. The reason is that it is difficult to forecast when a profit will be generated. This can be a problem for businesses that took out large loans at the outset.
  • Form a limited liability entity. Discuss with your attorney the best entity for your business. This will depend upon the type of business and your goals.
  • Open a separate checking account for your business. This will help to avoid comingling of funds. You should write yourself a check for salary and put it into your personal checking account. Do not use corporate funds for personal reasons.
  • Consider Insurance. This will also help to reduce the owner’s liability for business debts and judgments.• Get things in writing. Having your attorney help with contracts on the front end can save many headaches in the future. For example, if there is more than one shareholder, then you will need a written buy-sell agreement.
  • Consider intellectual property protection for the business. Discuss obtaining a trademark for your company name and/or logo with your attorney. In addition, consider whether you have intellectual property that may qualify for copyright or patent protection.
  • Put employment contracts in place at the outset. This is extremely important because it helps to manage the employee’s expectations. Employers may also want to consider confidentiality and nondisclosure and nonsolicitation provisions.

After reading these tips for starting a small business, you may realize that you need legal assistance to draft all of the required documents. Turn to Ritter Law Firm for all of your small business law needs. Contact the firm today for a free consultation.