Starting a business is an exciting milestone, but it is important to build the right foundation from the outset. The decisions you make in the early stages can have significant legal, financial, and tax implications as your business grows.

Before launching your business, take time to evaluate your goals, anticipated costs, available financing, and the level of risk you are prepared to assume. Creating a plan and assembling the right professional advisors can help set your business up for long-term success.

1. Create a Business Plan

A well-developed business plan serves as a roadmap for your business. It should outline your goals, target market, expected revenue, operating expenses, growth projections, and financing requirements.

Your business plan can also help you make important decisions regarding:

• Your business name and brand
• Business location and operations
• Funding and financing needs
• Hiring plans
• Short- and long-term growth strategies

This is also a good time to assemble your professional advisory team, including a lawyer and accountant, who can help you navigate legal, tax, and regulatory requirements as your business grows.

2. Choose the Right Business Structure

One of the first legal decisions you will make is how to structure your business. Common options include:

• Sole Proprietorship
• Partnership
• Corporation

Each structure has its own advantages and disadvantages relating to liability, taxation, ownership, management, and future growth opportunities.

For example, while a sole proprietorship may be simple and inexpensive to establish, incorporation can provide liability protection and additional tax-planning opportunities for many businesses.

Choosing the right structure depends on your specific goals and circumstances, and obtaining legal and accounting advice early can help avoid costly changes later.

3. Register Your Business and Obtain Necessary Licences

Once you have selected your business structure, you will need to complete the required registrations and obtain any licences or permits applicable to your industry.

Depending on the nature of your business, you may need to consider:

• Business name registration
• Incorporation (provincial or federal)
• Municipal business licences
• Industry-specific permits and regulatory approvals
• Trademark protection for your business name or branding
• GST/HST and PST registrations, where required
• Payroll and corporate tax accounts with the Canada Revenue Agency

You may also need to register with:

• WorkSafeBC if you hire workers
• Canada Revenue Agency for payroll deductions and tax reporting
• Canada Border Services Agency if you import or export goods

The specific requirements vary depending on the industry and type of business involved.

4. Arrange Financing and Set Up Banking

Most businesses require some level of start-up capital. Once your business has been established, you should open a dedicated business bank account and, if necessary, secure financing.

Potential sources of financing include:

• Business loans
• Lines of credit
• Investor funding
• Shareholder contributions

Lenders will often request copies of your business plan, financial projections, and organizational documents before approving financing. In some cases, business owners may be asked to provide personal guarantees, particularly during the early stages of a business.

Understanding your obligations before signing financing documents is critical.

5. Develop a Marketing Strategy

A strong marketing strategy helps establish your brand and attract customers from day one.

Consider:

• Creating a professional website
• Establishing a social media presence
• Developing a consistent brand identity
• Building relationships within your community and industry
• Creating a long-term marketing plan

Marketing should not be an afterthought. The earlier you begin building awareness of your business, the sooner you can establish credibility and generate growth.

Ready to Start Your Business?

Whether you are launching a new venture, purchasing an existing business, or considering incorporation, obtaining legal advice early can help you avoid common pitfalls and position your business for long-term success.

The business and corporate lawyers at RDM assist entrepreneurs and business owners throughout British Columbia with incorporations, shareholder agreements, business purchases and sales, financing transactions, and ongoing corporate matters.

Contact our Business Team to learn how we can help you build a strong foundation for your business.