For people who are tired of working the standard 9-to-5 job, starting a business can be an appealing alternative. If you’re thinking of starting a business, you’ve likely spent a lot of time daydreaming about the freedom that comes with owning a company. Imagine being able to say goodbye to working eight or nine hours a day in a cubicle or confined office. Imagine not having to answer to anyone. Picture the possibility of limitless income.
But you may be asking yourself — am I ready to start a business? While starting a business may be a good decision, it’s not as simple as it may seem, and it can be a stressful and challenging journey. Those who are considering becoming an entrepreneur should understand the steps to starting a business.
If you are a new business owner or want to begin your own company, David Pope Insurance Services, LLC has developed this guide to starting a business that can help you through every step of the process.
Before you start a business, you should ensure you understand your market. To do so, you’ll need to do some research. If you don’t do market research beforehand, this could doom your business before you even get it off the ground. Determine the exact nature of your business and your target demographic. The following are some ways you can perform your market research before starting your company:
Beyond basic demographics, you should know as much about your customers as possible. Before you start your business, ask yourself the following questions about your target audience:
Can you become an entrepreneur if you are unsure how you will fund your business? Part of the process of learning how to become an entrepreneur is determining whether you can afford to keep your company up and running.
Many entrepreneurs struggle to find the funds to launch and grow their businesses, but this is one of the first and most crucial financial choices you will make as a business owner. How you fund your enterprise may affect how you structure and run it.
When determining whether you can fund your business, consider your asset and capital requirements, along with your operating expenses. Your capital requirements include how much money you need to fund your enterprise and help it reach its financial and operational goals. Your assets will involve the resources your company owns, such as properties, buildings and patents. You shouldn’t go broke while trying to obtain all your necessary assets, which is why you should determine everything you’ll need for successful operation and budget accordingly.
Additionally, operating expenses will include things like inventory costs, payroll, rent and more. A major responsibility as a business owner will entail keeping your operating costs low while still maintaining quality service and staying ahead of the competition. To acquire an adequate amount of money for your company, you can:
The structure you choose for your business will affect how your day-to-day operations run, how much of your personal assets will be at risk and how much you will pay in taxes. Select a business structure that provides you with the right balance of benefits and legal protections. The following are some common business structures you may choose from.
A partnership is the simplest structure for a business owned by two or more people. Limited partnerships and limited liability partnerships are two common kinds. Here’s how they work:
If your enterprise has multiple owners who want to test a business idea before establishing a more formal organization, a partnership may be the right choice.
Sole proprietorships are easy to form and allow you to have complete control of the company. If you perform business activities and do not register as any type of business, you will automatically be considered a sole proprietorship.
A sole proprietorship does not create a separate business entity. As such, your business liabilities and assets are not considered separate from your personal liabilities and assets. Under a sole proprietorship, you may be held personally liable for your company’s obligations and debts. Raising money can be difficult, as you cannot sell stock, and banks are hesitant about lending to sole proprietorships.
If you want to test your business idea before you develop a formal company — and your business is low risk — a sole proprietorship may be the right choice for you.
Cooperatives are businesses owned and operated for the benefit of those who will use the companies’ services. Earnings and profits the cooperative generates will be distributed to the members. Generally, an elected board of officers and directors will run the cooperative, and regular members will have voting power to control the cooperative’s direction. Purchasing shares allows someone to become a member of the cooperative.
A corporation is a legal entity separate from the owners. A corporation offers the strongest protection to business owners against personal liability. However, the cost of forming a corporation is greater than other business structures. A corporation also requires more extensive reporting, record keeping and operational processes.
In terms of raising capital, corporations have an advantage because they can raise funds via selling stock. A corporation pays income tax on the business’s profits. Corporations may be a good option for a company with medium to high risk, one that needs to raise money or one you eventually plan to sell.
When you form an LLC, you can enjoy the benefits of both a partnership and corporation. In most instances, an LLC protects you from personal liability and your personal assets will not be at risk in the event of a lawsuit or bankruptcy.
In an LLC, you are considered self-employed and will likely need to pay self-employment taxes. In many states, LLCs also have a limited life. An LLC tends to be a good option for businesses with medium to high risk, owners with significant personal assets and owners who wish to pay a lower tax rate.
Many small business owners need a combination of permits and licenses from both state and federal agencies. The requirements vary depending on your location, government rules and business activities. The following are some examples of special licenses and permits you may need for your business:
Having a marketing plan is as important as having a business plan. A marketing plan is strategic, includes objectives, facts and numbers and is focused on winning and retaining customers. Follow these steps to create your marketing plan:
Today, business owners face many risks. Commercial or small business insurance can provide you with the protection and peace of mind you need. At David Pope Insurance, we can customize a commercial insurance policy to suit your business’s unique requirements for protection.
With commercial insurance, you can protect the money and time you have invested into your business. In Missouri, we are one of the preferred choices for commercial insurance brokers. Our insurance agents are dedicated to our clients and bring their passion and know-how to creating comprehensive, affordable business policies. Along with Missouri, we also serve other states, including Kansas, Tennessee, Iowa, Illinois, Arkansas, Colorado and Nebraska.
You deserve a commercial insurance plan that provides your business with the coverage needed at a price that fits within your company’s budget. We can help you find the commercial insurance plan that’s right for you thanks to our connections in the insurance industry.
Running a business comes with many responsibilities, from managing employees to controlling inventory. With commercial insurance, you can alleviate the stress of worrying about whether you are covered in the event of a disaster. When you connect with one of our agents at David Pope Insurance, we will learn what your business needs are and find the right plan to meet them. We will put our decades of experience to use, outlining the potential areas of concern and identifying a policy that can handle them.
We understand that not every commercial insurance policy is right for all businesses. Further, we know many businesses need multiple policies to successfully cover all of their concerns. As such, we ensure our agents are trained in writing various policies. When you choose David Pope Insurance, you won’t have to deal with the hassle of working with multiple insurance brokers. We offer the following types of business insurance plans:
If you’re looking to save money on your commercial insurance, you may want to consider bundling multiple policies. For complete protection, a business often needs more than a single commercial insurance policy. We can help put together a bundling package for you that allows you to obtain full protection with deep discounts.
We offer financial stability to our clients by finding the lowest rates available on the market. We are a local, family-owned agency with more than two decades of experience providing insurance to residents in Missouri. At David Pope Insurance, we can give you the peace of mind you need while keeping your costs low.
Along with commercial insurance, we offer the following policies to Missouri residents:
Assess yourself. Are you an entrepreneur? If you are a new business owner or are on the verge of starting your business in Missouri and want to learn more about commercial insurance, contact us at David Pope Insurance today.
