Many say it’s the American dream to start a business and be self-employed. There is something nostalgic about this goal that many have and want to accomplish in their lifetime. Whatever the business, it’s good to make a plan (or several plans) that help to outline the goals and aspirations of the business in the short or long term. One of the first plans a business owner should consider making is a business formation plan.
Business formation plans should be considered shortly after the decision is made and the inspiration is found to start the business. Business formation plans outline not only what type of business you are (LLC, s-corp, non-profit), but can also build on that by outlining what type of state and federal legislation is in place that can affect your business. They can outline a general business strategy and the best business formation plans should determine how to get a competitive edge by setting a business up for success.
Certain industries will have specific legal issues to address with not only the business formation project, but also when the doors open for business. There could be liability issues that could pertain to future employee liability, client liability or just general risks that one undertakes when they decide to go into business. As a business owner, you could be responsible for anything that goes wrong as a result of doing business. It’s best to get ahead of these potential risks early, identify them and plan a ‘what if’ scenario that serves the needs of everyone your business could impact.
In short, a full business formation plan includes more than just mandatory paperwork. Thinking about the benefits and challenges that may be presented to your new business, both now and in the future, is a great way to look at this process. Paperwork and permits will no doubt be necessary in the business formation process. However, it’s those vague issues that one should consider during the formation of the business and how to plan for them.
Source: FindLaw, “Hiring Legal Help with Business Formation,” Accessed Jan. 15, 2018