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Want to Start a New Business? Ask and Answer this One Simple Question

Earlier in January we posted a blog on what you need to do to start a new business in Washington state. I recommend that you check this out if you are considering starting a business as it gives you some tactical steps to take to be successful (including some that, if you miss, can lead to a lot of headaches later).

Before you even get to tactics, however, it’s important to ask and answer this very simple question: What do I want my business to do for me? This isn’t just a starter question; this is as important for the individual who has owned a business for 20 years as it is for the person who is just starting a business. This answer becomes the North Star, and the business owner who stays true to his or her answer will have more energy, fulfillment, and confidence than the one who doesn’t.

Although this question is simple on the surface, it takes continual honest and sober assessment as you build your business and time goes on. It is essential to have this North Star in place, stay aligned with it, and continually assess if you are meeting it. Because without this alignment, owning a small business can be difficult and lonely. Many more people choose to have a typical job with typical hours with typical benefits – and there is absolutely nothing wrong with taking that path if your own small business is not doing for you what you need it to.

But hey – we are in the small business game, and we wouldn’t change it for a second. We absolutely love what we get to do each day. Below are a few things to think about as you think about that simple question – What do I want my business to do for me?

Don’t Be Afraid to Get Personal

When you work for a large corporation, you are essentially opting in to its’ values (and associated perks). If bringing my dog to work is the most important thing to me, I’m going to choose to work for a company that allows me to bring my dog to work. But you don’t really get to bend the company rules – unless you are the next Albert Einstein! Additionally, you don’t really have the luxury to think about how your personal needs are going to be met; you figure that out on your own.

The beautiful thing about owning your own business is you can focus more on the personal side of things – some might say that you can be a little selfish. But I would dispute the ‘selfish’ notion; being able to set the terms enables us, as small business owners, to have a balanced life and be able to give back to the community in other ways. In fact, I’d say what the world needs right now is fewer frazzled, stressed-out people running around!

Is it important to you that you are home to take your son to soccer practice? Or that you can meet your spouse for lunch on Fridays? Absolutely build those types of things into your plan, and don’t be willing to give them up!

Review Your Preconceptions

We all have preconceptions about what it means to own a small business. A fairly common mindset is that you have to work long hours, barely make it month to month, stress out about costs like health care, and constantly do things you don’t like (such as accounting). Many people still start a business despite that, as they believe it is worth it because they are doing what they love and not answering to “the man”.

These preconceptions are further cemented by noticing how small businesses around us operate.  Whether we realize it or not, businesses are trying to impact our experience of their product/service from the moment we wake up to the moment we go to sleep.

Owning a small business has made us even more hyper-sensitive to these daily business interactions. We notice everything when we are connecting with other businesses – and not just the obvious things like customer service. We see subtler things as well, like when a business undervalues its’ services or is willing to work with people who don’t match its’ values.

As you analyze what you want for your own business, observe others – which business owners seem genuinely happy and how are they doing it? Which business owners seem miserable running a business and why are they so hassled or frazzled? And make sure that you are reviewing your own preconceptions. Don’t be willing to settle for less of an experience just because you think being a small business owner equals a frazzled life – it doesn’t have to!

Your Business (and your Answer) Will Change

In some ways, it’s easier to ask and answer ‘What do you want your business to do for you?’ when you are starting your business. When you’ve owned a business for any length of time, it really becomes a part of who you are. Walking away from a business is not easy – nor is making significant changes even when they are required.

As you embark on your journey, you need to understand that both your business and your answer will change. Your business will grow and it will face and overcome new challenges. Five years from now your business – the structure, people, and services – may look very different. But as your business grows and evolves you absolutely need to go back to the key question, because growth for growth’s sake is not worth it. Every change to your business needs to be viewed with the same approach that you started with, accounting for changes since you started.

Additionally, know that the answer to this key question will change as well. Perhaps you were single when you started your business and you got married along the way. You’ll definitely want to revisit the question and re-set what you’re doing so that the business is working for you.

Ready to Start a New Business in Washington State? Know these 10 things

The start of a new year always lends itself to dreaming – of new heights to achieve personally, new places to travel, new financial goals to set, and so much more. No matter how 2018 went for you, 2019 is a completely new canvas, and you have an opportunity to paint your brightest and boldest colors.

So why not start up that business you’ve always dreamt of? If you’ve been dreaming of leaving your day job and diving into something new, perhaps 2019 is the year to take the plunge!

After many years of hard work gaining experience and knowledge it should be easy to start, shouldn’t it?  Not really…starting a new business is exciting, but the path is also fraught with many details – small and large – that can seem tedious at best and overwhelming at worst.

If you decide to move forward, you could be on your way to making your dreams become a reality, creating the life you want and doing the things you love. But where to start? Below we’ve provided a 10 critical steps and knowledge points to help you get going.

Note that this list is specifically focused on Seattle-area Construction companies, but in many industries and locales there are likely some equivalent actions you will need to take, no matter the type of business you are starting. Now is the time to turn that dreaming into action!!!

Choose a Business Structure – Sole Proprietor, Partnership, Corporation, or LLC? There are specific tax implications for each option. We suggest meeting with a CPA who can walk you through the pros and cons of each to help you decide which option is best for you.

Apply for an Employer Identification Number (EIN) with the IRS – This number will allow you to open bank accounts for the business, apply for state business licenses, pay employer taxes, and file tax returns.

Register your Business with the Secretary of State – This is necessary if your new business will be a partnership, corporation, or llc.

Apply for a Washington State Business License – This will allow you to conduct business in the state. This application is where you will specify if you plan on hiring employees. If so, once you file this application, the two entities that handle unemployment insurance (Employment Security Department) and workers compensation (WA L&I) will be notified automatically and you will be assigned account numbers from each entity. Also, if you know you will be doing business in specific cities, you have the option to add city license endorsements while filing this application. Not all cities offer their licenses through this service, so check beforehand to see if your city has a separate application.

Purchase Bond & Liability Insurance – WA L&I requires contractors to have a surety bond for either $12,000 (General Contractor) or $6,000 (Specialty Contractor). Liability insurance coverage can be a $50,000 property damage policy and $200,000 public liability policy OR a $250,000 combined single limit policy. You can find more information here.

Complete Contractor Registration – This allows you to work as a licensed contractor in the state. Take your completed registration application and proof of your bond & insurance to any L&I office to have it notarized and processed.

Apply for City Licenses & Permits– Many cities in WA require you have a city license to conduct business there. Access WA is a helpful site that links to each city’s web page directly.

City of Seattle – Seattle has specific labor laws that are different than the state laws. If you will have employees working in Seattle, here is where you can find information on their requirements.

Apply for Reseller Permit This allows you to purchase materials purchased for direct resale without paying sales tax.

B&O and Sales Tax – Understanding the requirements specific to your industry is critical to be sure you are charging your customers the correct sales tax rates. DOR has provided a guide for contractors to understand their requirements.