With the 3rd-largest economy in the nation and top access to funding, New York is a great place to launch your business. The billion-dollar companies such as IBM, Etsy, Dior, Pfizer all have started and grown in the great state of New York, and if you’re an ambitious one like them, you might want to know how to be your own BOSS in New York yourself.
According to the SBA 2018 Small Business Profile, Small businesses in New York made up of 99.8% approx. 2.1 million in the small business communities with 4 million people in the workforce and almost 50.2% of the state’s employed population. New York’s economy was growing at an annual rate of 4%, which was faster than the national average of 3.4%. Are you feeling Inspired? Want to start your business in the great state of New York? Here is a systematic guide to start a business in New York and jump into the Empire State’s lively empire-building community.
- Start with a Business Plan
Successful businesses are based on thoughtful planning. Therefore, before putting your hard-earned money and other resources toward starting your business endeavors: create a game plan! The first step is to start any kind of business in New York or elsewhere is with a business plan. So while you may be overzealous to take off your business idea, take some time and devise a strategic plan. This will guide you from a starting point to your desired result and beyond. The following pointers should be the key elements of your business plan:
- A detail description of your product or service
- Your business pain point and your business address them.
- How your product or service is better than from your competitors
- The structure of your business’s management
- Your target market analysis
- How you plan to attract & retain your potential target market
- How much working capital you currently have
- Your funding requirements
- Your financial projections
- How long it will make the break-even
- How long it will take to make a profit
Have your business plan to be as detailed as possible and you can always make the needed changes and additions as you experience.
- Pick a Business Name
Selecting a business name is difficult and a wrong one can bring in many legal and business problems. Make sure you follow these tips before selecting a name:
- Make sure you’ve covered the basics
- Search the web for your proposed name.
- Do a trademark search with the US Patent and Trademark Office (USPTO).
- Search the New York Business Entity Database for business name availability
- Also, do a name search on the State of New York website
- Choose a Business Entity & Register Your Business
The next step is to choose a business entity. Every business entity has its own set of requirements and it will regulate your tax, management and ownership structure, and your degree of legal protection. The registration process for every business entity is also different.
Some common business structures include are LLCs, sole proprietorships, partnerships, and corporations. Among these business structures, LLCs are popular, because of easy formation criteria and maintenance, and legal protection.
Taking help from legal professionals will assist in defining the business structure that is most suitable for your business.
Tip: Get help from New York’s Business Express new business checklist to see each type of business structure entails, state registration process, formation fee, and ongoing requirements.
- Obtain Your EIN and Register for Taxes
Registering with New York’s Tax Department is the next step. A good start will get acquaint yourself with your state and local tax requirements, and you can glimpse at the state’s Department of Taxation and Finance website to check your tax obligations. The best is to get help from a legal professional who can give you a detailed overview of it.
Then, apply for an EIN with the IRS or via IRS Form SS-4, which is needed to file your business’s income or payroll tax return, open a business bank account, apply for a business credit card, hire employees, and apply for small business financing. If you’re a sole proprietorship, you can use your social security number in lieu of an EIN.
- Obtain Permits & Licenses
The next step is to obtain permits or licensing to legally operate a business in New York. The New York’s Business Express new business checklist includes links to your main county office to inquire about your licensing, permitting, and zoning requirements.
Here, you’ll also need to cover business insurance, such as unemployment insurance, workers’ compensation insurance, and disability benefits insurance if you’re planning to hire employees.
Irrespective of your need to hire employees, you still need some kind of insurance, like commercial property insurance, professional liability insurance, and/or general liability insurance.
- Get Business Funding
Effective business management and operations require constant inflow of capital. When you need business loans, banks shouldn’t be on your top list to apply for funding. Banks are reluctant to fund especially new businesses, because of low credit scores and less time in the business with the ability to handle debt.
Alternative lenders are the best option to secure startup funding. Usually, it involves using own savings, bootstrapping, borrowing from loved ones, crowdfunding, and/or apply for personal loans. You can also check out the New York’s Small Business Loan Resources page for state-specific funding.
- Get a Business Bank Account and Business Credit Card
A business bank account is necessary in order to maintain business records and to protect yourself. When you open a business bank account, you can obtain financial statements and get access to many other financial resources. The next thing to make sure is to keep your business and personal finances separate. Separating accounts will help protect your personal assets and will make your bookkeeping easier to organize. Opening the business and personal bank accounts in the same bank is logically easier and can get you loyalty benefits as well. As a startup, you can open just a checking account to get access to your cash and can later open a business savings account as you grow.
Signing up for a dedicated business credit card can help you with your daily business-related expenses. Getting a business credit card is easier as compared to traditional financing. Using your personal financial information, you can use your card for business expenses. Also, intelligent spending on your credit card can help improve your credit score, which is vital to qualify for a small business loan. In addition, funding your New York business will be easier by using a 0% intro APR credit card during the early days.
- Create A Marketing Plan
Now that you’ve set up your foundation and everything is in order, the next step is to start marketing your new business. You can start by creating a marketing plan to focus on building and maintaining your digital footprint and reaching out to the potential community.
The first step is to build a professional website including all the relevant information about your business and management. The next is to create your social presence on popular social media platforms like Facebook, Twitter, Instagram, LinkedIn, YouTube, etc. The next is to integrate content marketing into your marketing plan.
Word of mouth is still the best marketing tool. Irrespective of your plan to open a storefront, e-commerce store, or a service-based business, visiting local New York business owners in your neighborhood can help you grow via word of mouth marketing. And if customers have a great experience with your business services and/or products, it will help the word spread quickly.
The Bottom Line
If you follow the tips mentioned in this guide, we guarantee you will establish a solid foundation for your New York-based business and will be in footsteps of billion-dollar companies like IBM, Etsy, Dior, Pfizer.