Implement Your Home Based Business

In this step of the plan, you will

• Implement your business plan
• Capitalize your business
• File your local, state, and federal forms
• Obtain necessary permits and licenses
• Set up your bank account and arrange for financing, if needed
• Set up your accounting system

In the previous step, you developed your business plan. If you are not seeking financing or investors, you may have developed an informal business plan. It should include your mission statement and the objectives you have set for your business. Without goals, it is difficult to stay focused on what needs to be done.

By not seeking financing or investors, you will be funding your business from your personal funds. It is easy to get into debt if you use your personal credit cards to fund your business. Hopefully, as part of your business plan you established a budget. If your business is going to be operated part-time while you are still working on your full-time job, financing the business from your personal funds will be easier. However, you must consider the unexpected expenses you or your family may have.

Most local communities require a business license. You will need to contact your local city or county government to complete the necessary forms and pay a fee. If you are incorporating your business or going into a partnership, you will want to have an attorney to create the necessary documents. There are some "do-it-yourself forms available.

You should set up a separate bank account for your business. As an employee of a corporation, you can take a draw as your salary. For tax purposes, it is best not to co-mingle funds.

Your accounting system can be set up by you or you can hire someone to do it for you. If you hire a bookkeeper, it will cost less than an accountant. This person can teach you how to make the necessary entries. You may want to retain an accountant to do a year-end audit of your books and prepare your tax records.

In recent years with the proliferation of Internet businesses, some people start their businesses without going through formal planning. A lot of those businesses fail. Sometimes the plan looks good on paper and when you start to implement it, you find flaws. That is normal. Review your plan and work out any problems you see. It is not a given that if you a perfectly developed business plan, your business will succeed. It takes hard work and dedication. Sometimes, it turns out that the business is not quite what you expected it to be.

Do not give up. Try another idea.

Once you have your licenses and permits in place and your recordkeeping system, you are ready to start your business.