Congrats on wanting to become your own boss. Starting an Ohio business is a relatively easy process if you follow the proper steps in the correct order. Our article dives into all the steps to start a business in Ohio. Let’s get started.
1. Conduct market research to find a business idea
The first step to starting a company is picking a business idea—that is, what kinds of goods or services do you want to provide the public? Look for an idea that intersects with your passion and potential to generate income. Your passion comprises your skills and personal interests.
Conduct market research to determine the demand for your idea. Understand your competitors and the unique edge you bring to the market. Develop a unique selling point to communicate with potential customers to drive profit.
Useful market data you should gather includes surveys, polls, and focus groups.
2. Plan your new business
Planning your new Ohio business involves creating a business name, finding a location, and writing a business plan.
Your business name should be catchy and easy to remember. It should give an insight into the kind of business you run.
Ohio has naming rules for new LLCs and corporations. For instance, if you are planning to start an LLC, Ohio requires that you use the full phrase “Limited Liability Company” or one of the legally recognized abbreviations (L.L.C., LLC, limited, ltd., or ltd) while registering your new business.
Whatever name you choose, check that there are no similarly existing trade names currently registered in Ohio. You can do a business name or trademark lookup on the Ohio Secretary of State’s Business Search website.
Then, pick a location. The location of your Ohio business not only determines your customer base but also what kinds of permits you’ll need to obtain.
The next step is to write a business plan. A business plan is a clear roadmap of where your business is, your objectives, and the strategies you will use to accomplish your goal.
The business plan helps you develop a clear vision of your business and its current market value. It also attracts investors because they can see your strategies clearly laid out.
A business plan should include the following:
- Market research data
- Competitive analysis
- Sales and marketing strategies
- Product development plan
3. Plan your new business
The next step is to decide on what kind of legal entity you will operate under. Common business structures include LLCs, sole proprietorships, corporations, and nonprofits. Setting up the right legal structure is essential because it determines your liability for the business and the taxes you must pay.
- A sole proprietorship is a business considered legally the same as the individual. All the profits are yours, but all liability also falls on you. In Ohio, sole proprietorships do not need to register with the state, but you can file for a trade name or fictitious name with the Secretary of State if you do not wish to conduct business under your own personal name.
- A general partnership is similar to a sole proprietorship, except that it is owned by two or more persons. Like sole proprietorship, it does not need to register with the state of Ohio (but the owners have the option to file a Statement of Partnership Authority).
- A limited liability company (LLC) is viewed as separate from the business owner. It is taxed separately from the owner too. Also, liability for debts accrued is generally capped. This is a popular option for businesses with one owner.
- Partnerships are similar to LLCs, but multiple people own them. A partnership is taxed separately from the owners. You can form a limited partnership (LP), limited liability partnership (LLP), or a limited liability limited partnership (LLLP).
- A corporation is owned by its shareholders via shares of stock. Shareholders are considered legally distinct from the organization itself, and not personally responsible for any debts that it might incur.
4. File for Licenses & Permits
The final step is to file the appropriate paperwork required by federal, state, and local governments.
- First, register your business with the Ohio Secretary of State.
- Next, apply for a Federal Employer Identification Number (EIN) online through the IRS website.
- Open a business bank account. You will need your EIN for this.
- Register with the Ohio Department of Taxation to learn how to collect sales tax and when you should file tax returns, and so on. This department also coordinates the Ohio Small Business Tax Training Program.
- Report newly hired and re-hired business employees at the Ohio New Hire Reporting Center.
- If you have at least one employee, contact the Ohio Bureau of Workers’ Compensation to learn of any requirements you need to comply with.
- Contact the Ohio Department of Job & Family Services to determine whether you need to establish an Unemployment Compensation Tax Account.
- Call the county clerk at your business location to determine what licenses and permits you are required to obtain. If you will be selling goods or services to the public, this will likely include an Ohio seller’s permit.
- File an Annual Report of Unclaimed Funds with the Ohio Department of Commerce’s Division of Unclaimed Funds.
Nonprofits are allowed to apply for tax exemption from the IRS. They are required to register with the Ohio Attorney General’s Office if the nonprofit is a charity organization.
If you plan to purchase wholesale goods, it’s wise to learn how to fill out an Ohio resale certificate (exemption certificate). You can obtain these forms free of charge from the Ohio Department of Taxation website.
Benefits of working with FastFilings
FastFilings is a recognized and approved document filing service that helps Ohio businesses acquire the necessary permits and remain in good standing with the state.
Filing permits and applying for licenses takes work. With FastFilings, you can sit back and let our business experts go through the process.
When you hire FastFilings, you unlock access to benefits like:
- Hassle-free registration with the Ohio Secretary of State
- Expedited orders
- We track filing due dates and inform you beforehand
- We obtain the permits you need to do business in Ohio legally
Our experts are always available to help. Fill out this online form to get started.
Sources
https://www.ohiosos.gov/globalassets/publications/busserv/business_checklist22.pdf