By Randy Duermyer, About.com Guide
Step 5: Understand Legal Barriers to Starting Your Business
Check your zoning laws before starting a small business.
If you live in an area that is subject to the rules and regulations of a homeowners' or community association, check for restrictions. Find out what, if any restrictions exist on starting a small business in your home and how you might work within them before you invest one cent in your home business.
If you plan on starting a small business in your home, you may not be able to do so if you welcome clients or customers into your home, if you will be operating machinery, storing or working with hazardous materials, making noise, etc. These and other issues surrounding the nature of your small business may all have an impact on what you can and cannot do and can prevent you from starting a small business at entirely.
Will you need a special zoning exemption? Will getting one be a difficult and drawn out exercise? Is it even legal to operate the business you're planning? Will you need to secure a license before starting your small business?
Are your products and services potentially subject to patents, trademarks or copyrights?
More on understanding patents, trademarks and copyrights...
Step 6: Review Your Small Business Insurance Needs
When you go into business, you'll potentially be exposing yourself, your home and your family to a variety of risks. You need to think about how you'll manage those risks and find out if you need small business insurance to help handle them before it's too late.
Consider this:
**Will you need health insurance? If so, how can you get it and how much is it going to cost? **When one spouse is still working, the ideal situation may be to get the other included on the working spouse's health insurance coverage if you can. If not, either the cost or the lack of availability, or both may prevent you from starting your business.
More on health insurance...
**If you're carrying inventory, need equipment or are storing hazardous materials what kind of property insurance will you need to avoid suffering financial hardship? Will you need a small business insurance policy for this purpose and how much will it cost?
**Will you need liability insurance? Where can you get liability coverage under a small business insurance policy and how much is it going to cost? Will you need errors and omissions coverage?
**What about your auto insurance? Will you be using your car for business?
Remember, your homeowners' and auto insurance policies weren't designed to cover your small or home business. Your best bet is to shop for small business insurance that can help you manage your exposure to loss, so do your small business insurance and health insurance shopping ahead of time to save aggravation and surprises later.
Small business insurance can be a major expense of doing business, but some coverages like General Liability may be quite reasonable depending on the nature of your business.
Record any small business insurance cost estimates for this step - you'll need them to determine your startup and operating costs.
~~ TO BE CONTINUED TOMORROW, 05/21/2010 ~~
Step 5: Understand Legal Barriers to Starting Your Business
Check your zoning laws before starting a small business.
If you live in an area that is subject to the rules and regulations of a homeowners' or community association, check for restrictions. Find out what, if any restrictions exist on starting a small business in your home and how you might work within them before you invest one cent in your home business.
If you plan on starting a small business in your home, you may not be able to do so if you welcome clients or customers into your home, if you will be operating machinery, storing or working with hazardous materials, making noise, etc. These and other issues surrounding the nature of your small business may all have an impact on what you can and cannot do and can prevent you from starting a small business at entirely.
Will you need a special zoning exemption? Will getting one be a difficult and drawn out exercise? Is it even legal to operate the business you're planning? Will you need to secure a license before starting your small business?
Are your products and services potentially subject to patents, trademarks or copyrights?
More on understanding patents, trademarks and copyrights...
Step 6: Review Your Small Business Insurance Needs
When you go into business, you'll potentially be exposing yourself, your home and your family to a variety of risks. You need to think about how you'll manage those risks and find out if you need small business insurance to help handle them before it's too late.
Consider this:
**Will you need health insurance? If so, how can you get it and how much is it going to cost? **When one spouse is still working, the ideal situation may be to get the other included on the working spouse's health insurance coverage if you can. If not, either the cost or the lack of availability, or both may prevent you from starting your business.
More on health insurance...
**If you're carrying inventory, need equipment or are storing hazardous materials what kind of property insurance will you need to avoid suffering financial hardship? Will you need a small business insurance policy for this purpose and how much will it cost?
**Will you need liability insurance? Where can you get liability coverage under a small business insurance policy and how much is it going to cost? Will you need errors and omissions coverage?
**What about your auto insurance? Will you be using your car for business?
Remember, your homeowners' and auto insurance policies weren't designed to cover your small or home business. Your best bet is to shop for small business insurance that can help you manage your exposure to loss, so do your small business insurance and health insurance shopping ahead of time to save aggravation and surprises later.
Small business insurance can be a major expense of doing business, but some coverages like General Liability may be quite reasonable depending on the nature of your business.
Record any small business insurance cost estimates for this step - you'll need them to determine your startup and operating costs.
~~ TO BE CONTINUED TOMORROW, 05/21/2010 ~~
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