It’s never easy to start a small business. Many components key into establishing a company, and even after it is established there is no guarantee that it will be profitable or yield the kind of return that the owner or owners expect. Often, an idealistic entrepreneur makes the mistake of believing that a great concept or product is enough to push a small business to success. In fact, oftentimes the success of a business depends less on the strength of what it sells, and more in how it sells that product or service, as well as where. Before moving forward with starting a business at all, you should first focus on where you want to begin that business. For a lot of people, both residents and outsiders alike, that place is New York state.
Even looking beyond the hyper-competitive hub of New York City, New York state offers a number of options and advantages to young entrepreneurs. For most residents, staying in state may seem natural. Those looking to venture out of their home states to begin their businesses are quickly drawn to New York state due to the fact that it possesses the third largest economy in the country, with a gross state product of $1.44 trillion. The state packs quite a bit of buying power, and it’s quite welcoming to small business owners. With that being said, there are New York-specific quirks that small business owners must remain aware of if they are to be successful in the long term. Let’s look into how to start a small business in New York state, and what business owners should be aware of before moving to New York in the first place.
Why Should I Start My Business In New York State?
Remember that, as attractive as starting a small business may be, 70% of all business partnerships fail. Therefore, it’s important to give yourself as many advantages as possible from the beginning. The fact is that New York state residents simply have the income available to spend money on small businesses, in comparison to people in less affluent states. Furthermore, programs like Start-Up NY offer tax incentives to those that want to start small businesses in the state. New York state not only wants start-ups to begin within the state but stay in New York for the long term.
How Do I Start My Business?
No matter where you start your business, you’ll want to pick up with an idea that you’re passionate about and focus on a field in which you hold a good amount of knowledge and experience. Ideally, you’ll want to make connections in New York state as well, but this is not strictly necessary at first; connections will come with time as well. Choosing a business name is more key than you might think; with 92% of online searchers picking businesses on the first pages of their local search results, you’ll want yours to stand out. From there, you should pick a structure for your business. The three choices you’ll be offered include a DBA, which stands for “Doing Business As”; a corporation, which stands as its own entity with shareholders, directors, and officers; and an LLC, or Limited Liability Company, which doesn’t require directors and officers, and is often much easier to run in the long term. Typically, small business owners will decide between structuring themselves as a corporation or an LLC. A corporation is more ideal for those that plan on starting a larger company and raising funding. Furthermore, certain professions are required to choose a Professional Corporation. However, LLCs have recently gained more popularity as they are less complex and easier to manage.
How Do I Register My Business In New York State?
Following the basic beginnings of your startup, you will be required to register it. Forming an LLC in New York state can be done either in conjunction with the New York Secretary of State, who acts as the default registered agent, or with a registered agent service. You’ll then file the Articles of Organization with the New York Division of Corporations. The LLC must be published in at least two separate newspapers within 20 days of its formation. Then, an organizational meeting must be held, after which you’ll have the option of filing IRS Form 2553 to elect S-Corporation status. Beginning a corporation is similar in process, though rather than filing the Articles of Organization, you’ll file the Articles of Corporation. Its organizational meeting will be different as well, as it will involve gathering contributions from shareholders and electing directors and officers, as well as issuing stock and forming Corporate Bylaws. These factors will clearly not be involved in an LLC’s organizational meeting. A DBA essentially involves using a name for a business other than its legal name, and therefore filing a DBA will involve checking your business name through the County Recorder, obtaining a Certificate of Assumed Name, and filing the necessary forms with the County.
How Do I Solidify My Business?
Though the basic aspects above really “start” the business, the following steps will include obtaining your Federal Employer Identification Number, which functions much like a social security number for business owners, opening company accounts, obtaining business licenses and permits, and beginning regular business processes. Your FEIN is perhaps the most key, as it will allow you to register for state taxes like the New York Sales Tax and the Unemployment Insurance Tax and Employee Withholding Tax which must be filed on behalf of your employees.
While starting a small business is never easy, and 87% of all businesses report that their markets have become more competitive within the past three years, it’s remarkably rewarding. New York state offers the kinds of advantages that enhance these rewards, ultimately leading to greater longevity for your business.