ForumsStarting a Business

I began with the Business Economy Checking -- it's the lowest cost option, and until you start writing a lot of checks or making a lot of deposits, it provides everything you need -- including a free three-month trial of Premier On-line Services. As I said in my initial post, these initial decisions do not have to be forever -- you can always upgrade to banking products and services with greater functionality when the need arises. For most new one or two person operations, the most important things are to get started quickly and to spend no more money than absolutely necessary.

Hi Matt

Advice regarding setting up the business, look for the cheapest form of incorporation. LLC's are okay at a later level after you have partnerships and assets put into the business that are your own etc. Leave the LLC for now, just get a regular business license that registers the company name to you. If you can afford an incorporation do it. Go through the cheapest online incorporation. When you business catches on then decide your legal status, specially since you are not partnering with an outsider. Since you are selling knives an incorporation is the safest.

As far as bank account is concerned you need a chequing account. Savings accounts are no use to you since you are going to need to write checks. Regarding the merchant accounts, paypal becomes an expensive account for each transaction. The best thing is to get your own merchant account. This reduces your cost per transaction. But it is difficult for a new business to set up a merchant account, depending on your standing with your bank and your relationship. Check it out with your bank branch. If you cant get a merchant bank, authorize net and credit cards international and other processors are fine. Just make sure that when you are setting up your shopping card that it can handle the credit card processor that you plan to use. You cant pick a credit card processor and then get stuck trying to work with the shopping card they have. Initially if you can include the cost of the processing use paypal, it reduces your headache and does not cost you anything to set up and for terminal costs etc.

Also pick a good shipping agent for your courier costs. Dont get stuck with one courier service. They all have different rates for different locations

Good luck.

Everybody in business should have a checking account. For many reasons !) It shows that you really are
in business. 2) Your Accountant and the I R S want to see deposits and checks written. 3) What are you
going to do when you receive checks?? You get a Federal I D number on line at I R S.gov.
In business, you have to SPEND money to MAKE money.
Also remember SCORE. They are FREE and help the small businessman succeed.
Again, LUCKIEST

Well Matt it all depends on what your ambitions are at this time. If you are serious about your biz
then you should definitely think about avoiding legal and tax issues. A thing you can definitely do is
to establish a business entity. Start by:

1. Establish a fictitious business name as an individual and file it with your county
2. Get a city business license
3. Get a resellers permit with your state
4. Establish business checking account
5. Establish a business line of credit
6. Find a tax advisor and share with him your situation.

Hello, Matt ...

You Asked

Since this business is starting out from my home, and I won't have any employees to start with, what do you think the best way to go about registering the business is, and choosing a structure? Essentially, I want to make sure that I avoid any issues with taxation and protect myself from liability.

Does anyone have any experience with different payment processing services? Which ones do you like best / most?

My Reply

One key to financial success is CALIBRATING

cost management

taxation and tax incentives-disincentives

profits

benefits

tradeoffs and losses

CAVEAT Do not change from the Sole Propreitorship until you have done due diligence. Also note that the form of the company should align with the size, profit base, and the structure of the company.

First, conduct a comprehensive company situation analysis. Second, from the comfort of your office, peruse the plethora of Internet sources. You may gain enough personal knowledge to proceed on your own.

Third, check out legal providers. First, talk directly with those who will be closely evaluating your taxes - the IRS; they are extremely forthright and helpful. If you don't have attorney friends and acquaintances, you can also utilize your local legal aid, the local bar association (listing of corporate attorneys and pro bono attorneys). Bear in mind also that law librarians are extremely knowledgeable.

GOOGLE had the following information:

Sole Proprietorship

http://www.nolo.com/article.cfm/objectID/FE1875A0-239D-48E5-B7D2565E0CB62159/111/182/147/ART/

Forming a Corporation/Secretary of State

http://www.powerhomebiz.com/guide/cases/dineshchrissie.htm

Comparison of Sole Proprietorships, C Corporations, and S Corporations

http://www.corporate.com/howIncStep2.jsp

http://www.taxguru.org/corps/scorp.htm

http://www.spardata.com/valuation-information/c-versus-s-corporations.shtml

GBIntel
Global Business Intelligence
http://globalbusinessintelligence.googlepages.com/home

I'd recommend that you file a DBA with your county clerk and get your business up and running now as a sole proprietor. It's by far the cheapest, fastest, and simplest structure -- you could probably file the paperwork, get an Employer ID, and open a business bank account before today was over. Once you make some money and build a customer base, there are all kinds of creative options available for restructuring your enterprise (many of which are more advantageous than if you'd started with an LLC).

For the short term, you'd lose the "limited liability" that an LLC provides -- but you've indicated that you don't have any money, and that in itself effectively renders you "judgment proof" (attorneys who'd sue you for everything you've got won't bother if you don't have anything!).

Yes, you need an Employer ID number (you'll need it to open a business bank account, get a sales tax and use permit, etc.) Do it yourself after you've filed your DBA with your county clerk -- you can apply on-line and usually have it in a few minutes. Follow this link for instructions:
http://www.irs.gov/businesses/small/article/0,,id=102767,00.html

Hi Matt

My background is in IT and my wife and I recently started an online handbag website and a boutique in St Pete FL.

Not sure if you have decided on an e-comm application as of yet but I would highly recommend shop-script.com. I am not a sales rep for them and have no affiliation with them! LOL. However, I have investigated MANY shopping cart apps and this one was the easiest to set up and configure. I use it at my site: Http://www.DollsBags.com

As far as transaction processing goes, I have used PayPal Pro and it is good. I wasn't too fond of having to transfer funds out of PayPal to my AR account constantly, so I went with Authorize.net instead.

Regarding advertising and search engines. I have also done a LOT of research here too. Being in IT helps me quite a bit because I know a lot about how to get to the top of search engines. It takes 6 months to a year to do so effectively using FREE methods. Pay per click is OK if you write effective ads but it's tricky to beat the big guys to the top of the "Sponsored Links" column. But since you are just starting out and probably have a tight advertising budget, keep the costs down and use things like like exchange and affiliate programs.

Best of luck! Remember, Rome wasn't built in a day. What makes your business BETTER than all the other cutlery sites out there. Focus on that and you will have success!

Best Regards,

Rich Petrelli, VP
DollsBags.com