You are excited about your business idea and ready to start immediately. There are a few steps to be taken and the business startup process can take some time.
Rule of thumb to remember: It always takes twice as long as you expect and costs twice what you thought it would. ALWAYS. Double the time, double the money and you will be very close. Maybe.
How long does it take to start a business?
The time required to start a new business is dependent on the type, complexity, and location of the business.
You could start a home business with just one person. There are no employees or products.
A business with a large manufacturing facility and many employees could take up to one year to start.
If you are able to find a location that does not require too much work, you can open a service or retail business in under six months. The process will take longer if you need a loan or hire employees. A little less time may be needed to buy an existing business, but still not a lot.
Start-up Tasks
Here are a few important steps to starting a new business, and a guideline on how long it might take. This assumes that you will not be opening a store or retail outlet outside your home.
You can shorten the time to launch your business if, for example, you are able to juggle the tasks required or find a business advisor to assist you.
This timeline does not include the time needed to create documents such as a Business Planand business agreements. These are important, but they’re not directly connected to the startup process.
- The creation of a domain name and business name is one of the most crucial tasks when starting a new company. The name of your business will appear on all documents, marketing and advertising materials, as well as the website. Take your time to choose the right name. It will affect everything you do.
- Locating a Business Location
You can begin working from home immediately. It could take up to 2-3 months for you to lease and find a place. It could take up to 6 months for you to be able use the space if you need renovations. - Setting up your website, getting a phone number, Local business licenses and permits
It can take anywhere from a few weeks to one month depending on if you need a variance or a permit. - Application for State Business Registration (LLC, partnership or corporation)
It takes about a month to register a business, which includes time for you to consult with an attorney. You can register your business with the state before deciding on a location and then change it later. - How to get your employer ID from the IRS
You can apply online for an EIN and receive the ID instantly. - Receive and Purchase Equipment and Supplies
This can take several weeks, depending on how complex your business is. You’ll need to coordinate your deliveries with the location of your business. - Determine your funding needs, and Find funding sources.
You will need to begin this process several months before your startup date.
What takes the most time?
The two tasks that take up the most time are:
- Find a location for your business and get it ready
You must first decide on an area (city, town), then you can look at what’s available. Check the zoning. Next, negotiate the purchase or lease of a building. Finally, renovate the building according to your needs. This assumes, of course, that you do not have to start from scratch. That can take months. - How to Get a Bank Loan
For a loan from a bank, must create a business plan that includes detailed financial statements, a marketing plan and information on your management and operations. It takes time to create a business strategy.
You will need to know what you want to buy, the price and where to purchase it. Prepare income statements and financial information. You must then take your plan to several banks to see which ones will lend you money, either with or without SBA guarantees.
You can get up and running very quickly if you are lucky enough to find a location that is not too difficult and the bank you approach gives you a small loan. It doesn’t usually work out that way.
