How Do You Open a Small Business?


Quick Answer

An entrepreneur can start a small business by preparing a business plan, choosing and registering a business name, getting a tax identification number and applying for a business license or permit. An entrepreneur must open a business account and create an accounting system for his business.

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Full Answer

A business owner who sells products must apply for a certificate of resale that allows him to collect sales tax; however, sales tax does not apply to services. An entrepreneur must establish a line of credit for his business to create a strong credit history. This enhances an entrepreneur's relationship with his suppliers and creditors, and it raises the creditworthiness of the business.

At the beginning of a business, an entrepreneur may decide to manage his own finances using a simple accounting solution, such as a spreadsheet, to minimize costs. He must record all business expenses and incomes for tax purposes.

A business owner can use his business plan to get funding for his business from lenders, such as banks, credit unions and venture capitalists. His business plan must accurately detail his marketing approach, define his product and outline his operating procedures. He must also create a logo for his business that allows customers to identify him. An entrepreneur should seek professional advice on areas of business that he does not understand so that he can make good decisions.

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