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What Do I Need to Know to Run a Business?

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Question: What Do I Need to Know to Run a Business?
Answer:

How to Run a Business
Before you start running a business, you must have knowledge and skills in several important areas, including financial matters,business taxes, marketing and sales, insurance, distribution, employee relations and payroll, technology and computers, and more. Where do you start? What do you need to know? Where can you find help? While every detail of what you need to know to run a business can't be included in one article, you can find the major areas of business discussed here.

Where to Start - Create A Business Plan
Start by creating a business plan. Even if you don't need a bank loan or other financing, and even if you have a simple one-person business, creating a business plan helps you think through all the issues needed, like what legal type, what you want to sell, pricing, sales, and marketing, operations and technology, and financial projections.

Follow this simple business plan outline to get started on that business plan.

Sales, Marketing, and Distribution
Everything in your business is involved with sales and marketing. You need to figure out:

  • Who your potential customers are
  • How you will reach them to let them know about your business (through advertising and other marketing efforts)
  • How much you will charge for your products or services
  • And how to get your products or services distributed to or delivered to your customers.
Here are several articles on pricing strategies and cost pricing to help you get started with pricing.

Financial Matters

A large part of what it takes to run a business is financial information. On a monthly, quarterly, and yearly basis you need to get financial information so you can see how your business is doing. You need to know:

Legal matters
When you start out running a business, you will need to determine what legal form your business will take - sole proprietorship, LLC, partnership, or corporation. This article discusses business types and which type might be best for your situation.

For running your business ongoing, you will need a good attorney or a firm which can handle the various legal matters that might come up, like real estate, employment, intellectual property, and general contract work. Even if you have an attorney on your board of directors, it's a good idea to have a relationship with an outside law firm. Selecting an attorney should be one of your first tasks as you start a business.

Employees, Payroll, and Payroll Taxes
If you plan to hire and pay employees, you have to know about

Insurance Contracts
Every business needs insurance coverage. For example, you will need insurance:

  • On any property your business owns
  • On business assets like vehicles, equipment and machinery
  • In case of business interruption
  • For liability protection
  • Disability insurance on yourself and other key employees
  • And you may want insurance on your life and lives of other key employees Look for a good insurance agent who can help you get the insurance you need. This article can get you started on kinds of business insurance

    Business Taxes
    Businesses must pay many different kinds of taxes, and taxes must be paid to local, state, and federal agencies. You will need to know about all the taxes your business must pay to avoid issues with taxing authorities.

    To run a business, you'll need to wear a lot of different hats, but with time you will get better at doing all the tasks required of a small business owner.

    Where to Find Help Running a Business

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