Your business is going to need a lot of work to be able to function, not only from a cash flow and public relations standpoint, but also with regard to operating within the law. You will have to jump through a large number of legal hurdles to ensure that your business can operate within legal boundaries. They start off simple enough, but sometimes it can be tricky to make everything fit together properly. With care and patience, you can make this work effectively.
For starters, when you name your business, you have to check out whether the name has already been taken by another company. Find out if your company name is similar to existing trademarks by using the United States Patent and Trademark Office’s search tool. You should also search the internet to see what similarly named companies exist and if there might be a conflict or confusion from similarly named businesses. If your desired name is available, you would be wise to register it as a trademark.
Finally, every kind of sale needs to have standard contractual terms, which are often known as either the terms and conditions or the terms of business. These terms will dictate the rights and responsibilities of each party, and additionally they will keep you from having to divert your attention from the important aspects of running your business. Getting involved in legal actions is time consuming and expensive and ultimately leaves all involved bitter about the situation. So avoid this by establishing clear, carefully thought out terms for every transaction your business is going to participate in.
Licenses and insurance are also some important considerations you need to keep in mind before you begin. To start with, you need a business license and tax registration. Beyond that, there is a very high likelihood you are going to need Public Liability and Employer Liability insurance policies. This is almost certain for most types of business you intend to start.
You will also need to consider what type of company you are going to form. There are several ways to do business, such as a sole proprietorship, a partnership, a limited liability partnership or even a limited or unlimited company. To know which type of structure is the best for your intended purpose, you need to identify if you will take on partners and how much liability they are willing to take on. Legal forms that provide limited liability protect limited investors from losing more than their investment in a venture. Investors who are not protected by limited liability can be sued for more money than they invested. They have unlimited liability, even if they do not make decisions or participate in the day-to-day operations of the firm.
Your choice of business entity can also impact your taxes, so you need to be careful to choose the best option for your intentions.