Updated: Sep 7, 2021
Here are some fundamentals you should consider before starting your business.
Before you register
Do market research
Researching allows you to see if there is a demand for your product or services in your area. If you plan to do your selling online, look for websites and companies that sell those products. You want to make sure there is enough demand to sustain a business. If it looks like there is little market demand you may want to look into adding other services and products in your business.
Connect with other business owners
Connecting with other business owners in the same field you are wanting to work in allows you to learn from them. Getting connected with a business mentor will help you in your business journey. Look for times when the local chamber of commerce gathers, local networking groups, and even virtual groups.
Write up a business plan
Put down on paper or word document what you hope to get from the business. Writing down who you plan to sell to will help you stay on track in your business. Write down how you plan to finance your business. Having a business plan will help you stick to your goals. If you plan on getting financing from a bank or other lending institution you will need to present a business plan to them. Set out a budget or forecast of how the business finances will be for the next year to five years.
Choose a location
Location, location, location. If you plan to have a physical presence you need to choose a location that will be accessible by your ideal clients. Look for a location that is not only well-travelled but also in your budget. If you plan on being exclusively, or even adding online shopping as an option, you need to look for websites and social media platforms that will work for your business. Your web location is just as important as a storefront location.
Unless you are a millionaire, you will need to look into the different types of funding for your business. Creating a forecast of potential expenses will help you know how much in funding you will need to gather. Do not invest all of your life’s savings or retirement into starting a business. Still, invest enough to help get you started but also look for other ways to get investing, either through asking friends and families, partnering with others, bank or even government loans and grants.
There are three main types of business structures, sole proprietorship, partnership, and corporation. Depending on what structure you choose will affect your tax filing and potentially legal capabilities. Sole proprietorships are good for anyone who is starting a business on their own. A potential downfall is you are 100% responsible for any debt the business gets. Being in a partnership is great if you are going to go into business with one or more other people. This can increase the starting investment for the business as a whole. You will only be able to claim part of all income or expenses in the business for tax purposes, and depending on the liability structure still be on the line for the companies debts. A corporation takes all the liabilities and keeps them in the company. There are a lot more paperwork and legal setup that needs to be done when setting up your business as a corporation.
Choose a business name
Now for some of the fun part, coming up with a business name. You may have already come up with a name. Select a name that reflects your business and the type of people you want to attract. Use business registration sites to see if the name is already taken. Any business will need a website so also check the internet to see if it’s taken as well as social media. Some trades may have restrictions on what can be in your business name so look up any restrictions for your industry. Brainstorm with friends and families. Once you have chosen a name you need to register it with the provincial and the federal government.
Register with province
Unless you are a sole proprietor running your business under your name you will need to register your business name. If you are also planning on having a trademark on items or the business itself you will also need to register. Search for your province or territories registration website. Once you register with the province you may get a master business license stating your provincial business number as well as the name of the business and owners’ names. You may need to re-register every few years.
Register with CRA
Now that you have registered with the provencal government its time for you to register your business with the federal government. You will need to register to collect sales tax as well as set up payroll. If you are a corporation there will be corporate tax you will need to file each year.
Apply for permits
Some industries may require you to have a license or permit to carry out business. Search for any regulation for your specific work. If you have a storefront you may need a license to carry out work in your town. If you plan to advertise or sell certain goods on the premises you will need a license for that.
Open business bank account
Now that you have registered your business its time to open a bank account for your business. Each bank may require different things. Research different institutions to see what ones will benefit you the most. Open a checking account for day to day operations as well as a business credit card if able. Having a savings account to hold all your sales tax will help you have enough money when it comes due.
Signup for accounting/bookkeeping software
You need to keep track of your income and expenses. Pick an accounting software that will best fit your business. Some banking institutions may connect to accounting software for free. Make sure you can track inventory, if needs be, and sales tax. If you need help deciding one ask a bookkeeper or accountant.
Look for funding
If you have made a budget and notice that you need some funding. Gather together your business plan as well as any budget you have. Look for potential grants from your city, county, province and even the federal government. You may look into having a crowdfunding campaign running.
Promote your business
If you haven’t been promoting your business now is the time. There are many mediums to promote. Some organizations offer discounts or will event advertise for free for businesses that are a year or two into running. Look for ways to promote your business on social media and the web. Get your business listed on directories for your area and areas your clients may look at.
Now that you have everything set up its time to open up shop! Organize your products in a way that will catch the client’s attention. Continue to make your business better by analyzing your finances and staying up to date on products and services.