Starting a Business in Mississippi
Mississippi offers many prime opportunities for people who catch the entrepreneurial bug. According to SwitchOn Business, Mississippi gave rise to over 7,500 new operations in the past year alone. With so many people finding their success, now is a fantastic time to set some business goals and get working on your dream company. Whether you are a current resident or plan to move there shortly, the state is ready for economic growth and expansion across a variety of sectors.
Although Mississippi has a unique set of laws and guidelines to consider, the general process of creating a business looks very similar to other states. The following steps will give you a solid foundation to start with. From there, be sure to research the exact laws and procedures in your area of jurisdiction so you can keep your operation in good standing with the local authorities.
Come Up With a Strong Business Idea
The first thing you need is a concept for the business. Your interests, passions, and natural talents provide a reasonable place to start looking for a tangible idea. However, it is important to balance your emotional desires with logical business sense. Once you have a concept you love, it is wise to perform some market research to see if the business has a solid chance of success.
Enjoying your own business is quite important, though you also need to attract the interest of other people in the long run. If you are fortunate enough to know a trustworthy person who has started their own successful company, then consider running your ideas past them for extra guidance.
Draft Your Business Plan
It is time to take your idea and make it more concrete. A business plan is a written blueprint that details all aspects of the organization. How will you realistically make money? Placing numbers on important details such as cost vs profits is how you develop a strategy for operating your business. Having a plan in place is crucial before you get to work.
Business plans are also a major prerequisite for receiving funding from investors, local governments, and other sources. No matter who wants to give you money, they will need to see a cohesive and realistic plan before investing in your vision.
Create a Business Entity
Your business must have a legal identity that makes it distinctly recognizable from any individual or organization. There are four main types of legal entities to choose from, each with its own strengths and weaknesses to consider. Your business can be classified as a Sole Proprietorship, General Partnership, Corporation, or Limited Liability Company (commonly referred to as an LLC).
While you should always consult a legal expert who knows your situation before establishing anything final, it is quite common for small business owners in Mississippi to opt for an LLC. They provide a great deal of flexibility for tax purposes while also shielding you from any personal liability if your company runs into legal trouble down the line.
No matter which business entity you decide on, you will have to go to your local government and fill out an application. There is often an accompanying fee when creating the entity as well. Beyond that, the only other obstacle is a potential name conflict. You cannot use a name that is already taken, so it is extremely beneficial to research your desired name before heading down to sign any paperwork.
Register the Name of Your Company
With your entity selected, you can officially register the name to lock it in. If you are using your own name as part of the title, there is very little you need to do. However, if your business name has no connection to your civilian identity, you need to fill out additional forms. Brand names such as these are known as DBAs, which is short for “doing business as.”
Acquiring an EIN
The EIN, or Employer Identification Number, is akin to a Social Security number for your business. This nine-digit string is used to identify your brand for tax purposes within the United States. The IRS requires this number to facilitate tax returns, payroll deductions, and other similar financial functions.
You can fill out forms directly with the IRS to get the ball rolling on this step. Be sure to have your SSN, name, address, and other pieces of personal information at the ready to fill out the EIN application.
Establish a Business Banking Profile
Just as you establish separate legal names for your business, you also want to start a new bank account that is unique to your company. This makes bookkeeping far more realistic, and many banks feature special promotions and offers to entice new businesses to join the ranks of their customers. Take some time browsing all the banks near your location to see who has the best introductory deals.
While establishing a new bank account, you may as well go one step further and open up business lines of credit at the same institution. Having a credit line to work with can be extremely helpful when discovering the true initial costs of opening your operation.
Apply for Necessary Permits and Licensing
There are several state and federal licenses to acquire before you can start your business in earnest. These are pretty general for all new small businesses. However, you also need to consider any industry-specific permits or licenses you will need to acquire. As an example, you need a special license to sell liquor at your establishment. Be sure to double-check that you are legally able to offer everything you plan on selling to customers.
Seek External Funding
Having sufficient money to begin operations is the name of the game. If you are like most people, you will need to go beyond what is currently sitting in your wallet. The following methods are great techniques to attract funding from external sources.
Venture Capital Investments
One of the reasons you wrote that business plan earlier was to attract investors in this step. Venture capital exchanges money for a stake of equity in your company. This can be great for young organizations as no debt is accrued in the transaction. However, it is prudent to balance outside influence with your own vision for the business.
Small Business Loans
A small business loan allows you to retain full control of your company, though you will have to pay off all the money you borrow in the form of debt. That debt comes with a certain rate of interest, so be sure to work out palatable terms before committing to the payments.
Using Lender Match
If you are having difficulty securing a loan from the resources near you, try using Lender Match to find lenders that work with SBA-guaranteed loans. The SBA will guarantee a loan to get you started, provided you go through one of the lenders in their partner program.
Crowdfunding Platforms
Online crowdfunding platforms have exploded in popularity in recent years. They allow you to leverage people’s interest in your upcoming products or services to help get them off the ground. Backers send you money to conduct operations and only expect gifts in return for the early support. This is a fantastic way to raise capital without ceding ownership of your company or racking up major debts.
Each crowdfunding platform has unique rules and structures, so you have even more flexibility in choosing how to run campaigns. Of course, crowdfunding is most successful when you already have an audience or a lot of interest in your work.
SBA Investment Programs
The Small Business Administration has several programs that grant funding for new business owners. It is always worth taking the time to see if you qualify for any of these government-backed initiatives.
Bring On Some Staff
Depending on the nature of your business, it may prove quite challenging to do it all yourself. Hiring some additional hands is a healthy step for growing companies and will make the workload more manageable. Check with the Mississippi Department of Employment Security for resources on how to register any new staff you bring on.
It is worth remembering that the goal is to find employees you can rely on. Take some time to research how to hire people before scheduling a bunch of interviews. If you know how to pick out the winners from a crowd, you can avoid many issues in your daily operations.
Safeguard Yourself With Business Insurance
A Mississippi Business Owner’s Policy protects you from many unfortunate circumstances that could befall your company. These include physical damages such as fires or storms and may also include digital goods such as employees’ personal data. Your policy can be customized to cover nearly anything that could go wrong in your specific operation.
General Liabilities
This general form of insurance covers broad topics such as bodily harm, property damage, and advertising losses. If you own a commercial property, additional points can be added to this type of insurance to cover things like medical costs for people injured at your building.
Workers’ Compensation
If you have at least five employees, Mississippi requires you to get some workers’ compensation insurance. This provides benefits to employees who get injured while on the clock. Coverage includes medical costs and any potential lost wages if they are out of work to recover.
Workers’ compensation often protects a firm if an employee’s family attempts to sue. However, it is paramount that you consult a legal expert to confirm you are covered if a lawsuit is on the table.
Get Your Mississippi Business Off to a Running Start Today
Although starting a business takes a great deal of effort, Mississippi is a fine place to launch your entrepreneurial dream. There are plentiful opportunities, a lot of room, and many avenues of support for budding small business owners. In addition to all the wonderful resources in Mississippi, the internet boasts a wealth of informative content and services that help you promote your venture.
Of course, we would be happy to assist you every step of the way in connecting you to these resources. At American Business Credit, we help small business owners just like you connect with the funding needed to get going with aplomb. Acquire unsecured loans for any industry, including franchises, agriculture, restaurants, medical practices, and industrial sites to name a few. No matter your walk of life, we will get you the resources you need. All you have to do is reach out to us today via our website.
