So you want to start your own business? You have some ideas but have not developed a plan to make it happen. The following steps will help you develop a plan for your business and ensure that you have considered all of the important aspects. The plan will increase your chances of success and will be necessary if you intend to borrow money
Step 1 – Evaluating Your Business Idea
The first step in developing a business plan is to have a well thought-out concept. Carefully read and complete the “Evaluating Your Business Idea” workbook. This workbook will assist you in addressing all of the topics necessary to develop your business plan. Taking the time to evaluate yourself and your business concept, will improve your chance of success.
Step 2 – Determine your personal financial situation
Most new or future business owners need to have a personal financial statement. The statement includes all of your personal assets, liabilities and net worth and will determine the income necessary to meet personal financial obligations. Accurately and completely fill out the “Personal Financial Statement” for each owner. Anyone owning 20% or more of the business, or anyone having a majority financial interest in the business, will need to complete a personal financial statement. It is also important to know and understand your personal credit score before approaching a lender for consideration.
Step 3 – Consider your management skills
Complete the “Management Resume” for each owner as well as key employees who are critical to the success of the business. In addition to identifying skills, you will need to provide some personal information that may be required by your lender.
Click here to print: “Management Resume”
Step 4 – Meet with a Professional Business Consultant
The Small Business Development Center will assist you in organizing your information into a complete business plan. To apply for assistance, complete your request at Southeast Minnesota SBDC Client Signup. You may also complete and sign the Request for Counseling form and contact the SDBC to arrange a meeting with a consultant. Contact Rick Indrelie at the Rochester SBDC at (507) 280 – 5503.
Step 5 – Determine if you need a license or permit
Some business types are regulated and require a license or permit issued by the state or local government. You can search the following link to identify if a license is required and the steps necessary to complete the application: http://mn.gov/elicense/
Step 6 – Determine the appropriate business structure
Once you have finalized your plan you will need to determine the appropriate form of organization for your business situation. There are many factors to consider in choosing a form of organization; the “Guide to Starting a Small Business in Minnesota” provides valuable information to help you make a decision. Also, the SBDC hosts a Legal Advice Clinic that can provide information to assist you.
Step 7 – Registering your business with the Federal Government
You may or may not need to register your business with the Federal Government, go to the following link to determine whether or not it is necessary for your business.
http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Employer-ID-Numbers-EINs . If you need an Employer Identification Number (EIN):
Step 8 – Registering your business with the State of Minnesota
All businesses need to be registered with the state of Minnesota. The registration process will provide a number that will be used to file income and sales tax. Complete http://taxes.state.mn.us/business_taxpayers/pages/index.aspx