Last Friday, May 15th, Oklahoma entered Phase 2 of its economic re-opening. For the past few weeks in the Freedom Friday blog, I have been sharing some tips about how to re-open your small business and preparing for the future. In this week's Freedom Friday blog, I am going to discuss a different topic, which I was asked about recently, and that is starting an online business.
So, should you start an online business in the COVID-19 Economy? Well, it depends on several factors. First of all, you should NOT let the COVID-19 economy prevent you from starting an online business. In fact, I think the COVID-19 economy is a great time to start an online business, if you prepare and follow the steps I am about to share regarding starting an online business in the COVID-19 economy. Here are six (6) steps to start an online business in the COVID-19 economy.
1. Develop a Business Plan
The first step in starting an online business in the COVID-19 economy is to develop a business plan. This is the first step in starting any business. You need to define your product carefully and do your homework to make sure there is a market for your product. So, how do you create a business plan for your online business? A business plan is a road map to help guide you along while you start and grow your online business. It can be modified and changed as your goals change. There is a lot of information online about how to develop a business plan, including free templates.
2. Gather Your Team
The second step in starting an online business in the COVID-19 economy is to gather your team. What I mean by “team” is the people who will provide you the necessary support, advice, and guidance you need while you start your online business. Your team can include an accountant or tax professional, an attorney, a mentor, and even a business coach. Now, you might ask if you should include LegalZoom or a DIY resource as part of your team. LegalZoom and DIY legal resources can sometimes be a good service, for some people, some of the time. However, you should be very careful when using LegalZoom or a DIY legal resource to avoid future problems. Some documents you can get from these websites may be fine for certain kinds of people, in certain situations, to meet certain kinds of needs. For some people, this is OK. However, sometimes for your online business, just being “OK” is not good enough for what you really need, and you should consider consulting an attorney.
3. Choose Your Business Entity
The third step in starting an online business in the COVID-19 economy is to choose your business entity. One of the most important decisions you will ever make as an owner of an online business is your business entity. This is a critical decision to starting your business on the right foot. I highly recommend you consult with an attorney before choosing your business entity. I also highly recommend that you and/or your attorney conduct a name search before you choose your business entity. The Oklahoma Secretary of State will require you to perform a name search because you cannot name your business with a name that already exists. Also, if you're interested in trademarking your business name, you or your attorney should also conduct a trademark search.
4. Create Your Business Documents
5. Apply for an EIN
The fifth step in starting an online business is to apply for an EIN. What is an EIN? An EIN is your online business's federal Employer Identification Number, which is used for tax purposes by the Internal Revenue Service (IRS). If you plan to open a business bank account for your online business, your bank will require you to have an EIN. Your EIN might also be required to apply for any business licenses or permits you might need to operate your online business.
6. Open Business Bank Accounts
The sixth step in starting an online business is to open at least one business bank account, or perhaps multiple business bank accounts. If you are the owner of an online business, it is important to keep your business assets separate from your personal assets. If you mix your business assets with your personal assets, you will open yourself up to liability if your online business gets sued. This is another reason why it is important to maintain formalities with your online business. If your online business gets sued, you do not want your home, your car, or other assets in your own name to be at risk through “piercing the corporate veil.” An important step in starting an online business is to protect your personal assets by keeping separate bank accounts for your online business and for you, personally.
If you're interested in starting an online business anywhere in Oklahoma, or if you have an online or small business, and you are looking to grow, please feel free to contact me at [email protected], and schedule a free discovery call.
For more information about Liberty Legal Solutions, LLC, please visit our website at http://www.libertylegalok.com
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