Diving into the market might feel scary, but there is a right and wrong way to doing it. In a pond of big fish and little fish, you are the smallest when you start out.
And the pond is big. According to the U.S. Small Business Administration’s Office of Advocacy, Michigan had over 850,000 small businesses in 2019 and they employed nearly 50% of the private workforce. Having a solid foundation underneath you may help those initial steps of forming a business and pave the way for future success.
Have a business plan
This does not just refer to what services you provide, it also refers to how you structure your company, what strategies you have going into this business and any analysis on the marketing or legal aspects of your venture.
Choose the right business entity
There are a lot of options for organizing your business. Sole proprietorships offer an easy avenue into the market with less paperwork and fewer business fees but offer no liability protection. Limited liability companies require more in the way of formal business formation, but separates your assets from your business assets for the purpose of liability. You want the formation that fits your business needs best.
Protect any starting IP
When starting out, you may have big ideas for logos or innovations that only you bring to the table. Protecting those pieces of intellectual property prevents competition from using them without your explicit permission or licensing.
The legal aspects of business formation may seem like an obstacle between you and success, but it is one of the most crucial times for your business. If you fail to organize your business using optimal legal structuring, you may end up applying ill-fitting strategies that hinder that success.