MoneyMagpie

Feb 12

Your Guide to Starting an Online Business

Reading Time: 2 mins

With more than 200 million shopping online annually since 2015, 2020 is the year to consider going online. Business investors looking to start an eCommerce website will need a checklist to guide them on what to do and what not to do. You can click here for more Info on eCommerce businesses.

Start by Choosing a Business Name

After you have decided on what you will be selling online, the next logical step is to choose a business name that is both memorable and fabulous. Remember that it needs to be a name that is not in use by another company or organization.

Conducting a corporate name search helps you determine whether the name you have settled on is in use at the moment. Having chosen your preferred name, proceed to have it registered as either a corporation or LLC.

 

Secure the Domain Name and the Website

If at all possible, the business name should also be your domain name. But in the event that the name isn’t available, go for a URL that clients can spell with ease, and which is directly related to your business operations.

When starting out, the design of the online store is probably the biggest expense you will need to contend with. But you have to confirm that the eCommerce store is both functional and visually appealing.

Decide on whether you want to go with something custom-made or whether you would rather use an out-of-the-box online solution.

 

Register the Business and Choose a Good Business Structure

When the time comes for you to select your preferred business structure, you will have several solutions open to you:
• Corporation
• Sole proprietor
• LLC
• A partnership if you are working with another investor

Investors who don’t choose structures such as an LLC or corporation are automatically placed in the partnership or sole proprietorship categories by the tax authorities. But it’s not advisable to operate as a sole proprietor as it means that your personal assets will also be in harm’s way.

If your business gets sued for any one reason, the courts may opt to seize all the assets under your name to cover any debts not covered by the business finances. Opting to register the business as an LLC or corporation means that you and your assets are legally separated from the company.

You also get to benefit from numerous other tax benefits. It’s possible to register the firm on your own by filling out the paperwork, or by having a business specializing in this line of work handle it for you. Retaining a lawyer is also a viable option, though some may consider this overkill for a small start-up.

 

Obtain Your Employer Identification Number

Business owners will need to obtain an EIN (Employer Identification Number) for them to open and operate any business account. This is the same number that you will use when filing your taxes.

The Employer Identification Number may also be equated to the business social security number. It’s what is used to distinguish your business from others, while also making it possible for you to file your annual tax returns.

It’s a number all businesses will need to obtain regardless of whether you have people working for you or not.

 

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