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How difficult is it to start a business and what is the process?

How difficult is it to start a business and what is the process

Thank you comment icon Starting a business is a very long and difficult process. Aside from the licensing and legal requirements, starting a business takes a lot of planning and dedication. Of course, with social media and technology nowadays, you can start a business from your house and have low overhead costs as well as startup requirements; however, making sure you have a product or service that people want to buy is very important. Proving this requires time and money put into doing consumer validation research and surveys. Then you must figure out your costs and then how much you want to sell your product/service for. Next is producing the product/service and finding ways to sell it! sarah

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Alexa’s Answer

Hi! You have to think about what you would like to pursue, once you know that you need a game plan.

How will you fund this business while your are starting up, how will you market this business, what is your target audience, will you be able to hire employees to help you.

I recommend talking to people in the business you’re trying to purse, or doing research. There’s is a great chance that your business will be successful, but you need to be knowledgeable before starting up.

For example, there is a great cafe down the road from me. Modern, great food and atmosphere, but the location they picked is not ideal and I don’t know how long it’s going to last.

Goodluck!
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Aaron’s Answer

It's technically not hard. In general, if you're just starting off and it's not a business that requires you to have "special training" or education, then you can go ahead and start your business as "self-proprietor" meaning that the business and you are essentially the same person for tax purposes. You just put your personal social security down for taxes as the entity to be taxed for income earned. Things get more complicated if your business expands to needing employees, etc. However, there are many great benefits to having a business such as creating an LLC which allows you to start investing in your retirement under an SEP (self employment) IRA...higher contribution limits...or to file a S-Corp which essentially allows you to create an employee 401k (yourself) and then your "company" (aka...yourself) can match your personal 401k contributions ;)

The main thing I recommend....learn taxes. H&R block has an easy and excellent tax certificate you can do every upcoming tax season for around a $140. Understand the types of business that can exist in the tax world. Understand which one makes sense for you starting off.

I help small businesses a lot and unfortunately I see many great ideas burn and die due to a lack of understanding of what they need to pay in taxes or how, and how to secure as much of your income as possible into future retirement savings.

Aaron recommends the following next steps:

Start as a self-proprietor
Learn Taxes
Research LLC and S-Corp for single member entities
Make a financial plan (maximize profits against taxes by storing away business income into SEP-IRA or S-Corp 401k matching, etc)
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Melissa’s Answer

It all depends on what type of business you are thinking of starting and the laws in the state you are wanting to do business in. If it is a profession that is typically licensed, you will need to consult with the licensing board to see what the requirements are. I would suggest you start by googling the type of business you are thinking about, along with the state you will be working in to see what comes up. Best of luck to you!
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Tessa’s Answer

In addition to licensing, you'll want to craft a very specific and thorough business plan! There are many online resources that provide business plan templates that can help guide you through defining your offering, your target audience, revenue plan, etc. I would also check out your local town to see if they have any small business competitions! This is a great way to get practice writing business plans and pitching ideas to investors (people who can supply you with money before your business starts making money). Best of luck!
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Robert’s Answer

Great question. It can be inexpensive, simple and very profitable or very expensive, complicated and years before you see a return on the investment.
Talk to SUCCESSFUL entrepreneurs who have accomplished what you are trying to achieve. Earn their mentorship and they will help you. Avoid taking advice from people who have jobs or opinions but no actual experience building their own successful business.
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