Starting a Business: 5 Things You Need To DoAug 6 2019
Before you start a business in BC, be sure you know that having a business is right for you. Not only will it require more of your time than if you were working for another company, but you will also need to allow for expenses such as registration, incorporation, start-up fees, supply and equipment purchases and marketing. Creating a plan helps outline your goals.
1. Business Plan
This is an important first step because it outlines your goals including how much money you expect the business to make. The plan will help you make important choices, such as the name of your business, the location and the type of entity you want to register under. It also assists with accessing the proper financing, based on your annual growth targets. Your business plan should also include creating a business team, including a lawyer and accountant, who will act on behalf of your business and assist you as your business grows.
2. Naming & Business Structure
Once your business plan is in place, you need to decide on your company’s name. You will also need to decide how you want to register your business: as a sole proprietorship, partnership or incorporation. There are pros and cons associated with each one, depending on which direction you wish to take your business. A business lawyer can provide you with a comprehensive background in this area.
3. Registration & Licenses
Registering your business and procuring the necessary licenses and permits can be time consuming but they can also save you time and money down the road. A good business lawyer can help you get the necessary paperwork underway and assist you with navigating the process.
Registrations and licenses vary based on the industry you choose. You may, for example, want to consider trademarking your company name to avoid potential conflicts. All businesses require a Provincial Sales Tax license and – if you sell goods or services – the Goods and Services Tax is also mandatory.
You will also need to decide if you want to register provincially (BC only) or federally. The decision to register provincially or federally will be based on your own specific expectations for your business, as each have their own pros and cons. A business lawyer can help explain the distinction between the two more thoroughly.
Additional registration with other entities that you will need to consider include:
- WorkSafeBC (premiums must be paid if you are hiring employees);
- Canada Revenue Agency (if paying salaries, bonuses, wages, vacation pay, etc.);
- Canada Revenue Agency (corporate income tax account); and
- Canada Border Services Agency (If you are importing or exporting goods).
4. Business Financing
Once you have everything registered, you will need to set up a corporate bank account and you may need to apply for a business loan. Most lenders will ask for a copy of your business plan and your incorporation documents, after which they will review the plan and check your credit. As a new business, many lenders may require additional security from its shareholders or directors until the business is in a more stable financial position so you may be expected to co-sign for a business loan. This means you will be personally responsible for the loan. Once financing is in place, supplies and equipment can be purchased, if needed.
Part of your business plan should include a five-year marketing plan. Make sure you have an online presence: take advantage of social media and create a website. The sooner you start marketing your business, you can establish your company’s brand – leading to improved sales and faster returns.
Contact RDM Lawyers
If you are ready to start your own business or have questions regarding registration or licensing, contact one of RDM’s business and corporate lawyers.