Author: damiong

Choose a Business Structure

There are several different types of legal structures for you to choose from, each with implications for your taxes, personal liability, partnerships, and registration requirements. The below is not meant to be an exhaustive list of the different types of legal structures—and is also not meant to serve as legal or tax advice—but it can serve as a starting point for your own research. Depending on their needs, many business owners also consult with an attorney.

Some types of legal structures are easier to set up than others. For instance, forming a sole proprietorship does not require you to file any legal documents, while for entities such as corporations, Limited Liability Companies, General Partnerships, Limited Partnerships, and Limited Liability Partnerships, you will need to formally incorporate your company with the State of Georgia.

For more information about selecting your Business Structure visit the Small Business Administration

Sole Proprietorship

  • Advantages
    • Easiest and least expensive to set up
    • Full control over all business decisions
    • Minimal legal restrictions or requirements
    • Owns all profits and reaps all benefits
    • Not required to pay unemployment taxes
  • Disavantages
    • Personally liable for all business transactions
    • May have difficulty obtaining long-term financing
    • No unemployment benefits if the business fails
    • Limited tax savings

General Partnership

  • Advantages
    • Easy to establish
    • Partners share workload and responsibilities
    • Financing is easier to obtain than for a sole proprietorship
    • The partners share all profits and reap all benefits of ownership
  • Disavantages
    • May be more expensive to start
    • Partners have unlimited liability for business expenses
    • Each partner is bound by the actions of the other partner
    • Decision-making authority is divided
    • Loss of one partner may dissolve the business
    • Partnership may be difficult to end

Limited Partnership

  • Advantages
    • Relatively easy to establish
    • Partners share in start-up expenses
    • Financing is easier to obtain than for a sole proprietorship
    • Partners share all profits and reap all benefits of ownership
  • Disadvantages
    • More expensive to set up initially due to the requirement for a written agreement
    • Operating (general) partner has unlimited liability for expenses
    • Loss of one partner may dissolve the business

Limited Liability Partnership (LLP)

  • Advantages
    • Tax advantage of flow-through tax treatment for LLP partners
    • Simple for an existing partnership to become an LLP
  • Disadvantages
    • A sole owner cannot set up an LLP as a partnership; an LLP must have at least two partners to exist

C (General) Corporation

  • Advantages
    • Has a lifespan independent from its owners (stockholders)
    • Fringe benefits costs are tax-deductible
    • Personal assets are protected from business liability
    • Ownership can be transferred through the sale of stock
    • Easy to raise operating capital through the sale of stock
    • Ownership can change without affecting daily management
  • Disadvantages
    • Incorporating involves considerable start-up expenses
    • Subject to more District and federal legislation
    • Corporate earnings subject to double taxation
    • Many legal formalities exist when filing corporate status
    • Activities are limited

S Corporation

  • Advantages
    • Already exists as a corporation
    • Corporate earnings avoid double-taxation
  • Disadvantages
    • Difficult to qualify for IRS requirements

Limited Liability Company (LLC)

  • Advantages
    • Profits and losses pass through the company to its owners for tax purposes
    • Personal assets are protected from business liability
    • No limitation on the number or nature of owners
    • Easier to operate than a corporation
    • Not subject to corporate formalities
    • Owners may participate in management of the business
  • Disadvantages
    • Legal assistance is needed to properly set up and structure
    • Professionals—such as lawyers, accountants, and doctors—are prohibited from registering as an LLC

Nonprofit

  • Advantages
    • Tax exemption
    • Business operation flexibility
  • Disadvantages
    • Merger limitations

 

 

Creating a Business Plan

Creating a business plan is one of the first steps you should take as a prospective business owner. It will help you to craft your game plan, hone your product, understand your customer base, and guide your decision-making to set up your business for success.

Writing a Business Plan

Writing a business plan is an important first step to getting your business up and running. An effective business plan will serve as a roadmap for your business, guide your decision-making process, help you to obtain financing, build relationships, attract good employees, and boost your confidence as a business owner.

The structure of a business plan may vary depending on your business and needs, but it often incorporates the sections below:

Executive Summary

The executive summary is the first (and sometimes only) part of your business plan that people will read. The executive summary should provide information about your business and incorporate the highlights from each of the sections below. Ultimately, you want to leave the readers with a strong understanding of what your business is and why it will be successful.

Introduction

Provide a high-level overview of your business, how it will be structured and what your goals are for your business.

Business Description

Describe your business, the specific product or service that you will offer, and the features that differentiate you from your competitors.

Market Analysis

Demonstrate why your business model is relevant and timely. This section should ideally include information about industry trends, your target customers and their demographics, and your competitors in the region. This information will be essential to help you think about how to differentiate your product, where and who to market to, and different locations where your business might be most successful.

Organization & Management

Focus on the ownership, legal structure, and human resources side of your business. Use this area to introduce your team and the skills and expertise that they bring to the table. It can be helpful to provide an organizational chart to show the roles and responsibilities of you and your team, and a plan for when and how to hire additional staff if needed.

Marketing & Sales

Provide a plan of action to market and sell your product or service to the target customers that you identified in the Market Analysis. Identify the different strategies that you can use to build and grow your business over time.

Finances

Show your current and projected financial status, including balance sheets, a cash flow statement, and revenue projections. In simple terms: how much do you need to earn each month to cover wages, rent, loans, equipment, and other expenses?

Appendix or Supporting Documents

Include additional documents that support your plan

Resources

Strongbox West
Strongbox West is a coworking space designed to accommodate startups, small businesses, freelancers, artists, and makers. Their memberships include packages covering desks, offices, meeting rooms, or just working space for a day.

The Gathering Spot
An innovative, private, members-only city club that brings together a motivated
and diverse community of professionals, creatives and entrepreneurs. Members will benefit from
a 24/7 alternative work and social environment, complete with stimulating events, concierge
services, integrated technology and a full-service restaurant and bar.

Atlanta Tech Village
Atlanta Tech Village provides a community of other passionate, supportive entrepreneurs who will support and collaborate with other entities along their respective start-up journeys. Space at the Village provides interaction space to solve problems, mentors and advisors, event and networking opportunities, and more. 

F6S Network
F6S is an online platform that provides opportunities to connect with accelerators, funds, and investors, get help and advice, and grow your startup. The search engine allows users to search by location and use other filters to get the most individualized results for each person.

Startup Grind
Startup Grind is a global startup community designed to educate, inspire, and connect entrepreneurs. It is powered by Google for entrepreneurs. The platform host monthly events in 200 cities and 85 countries and has a community in Atlanta. Its events feature successful local founders, innovators, educators and investors who share personal stories and lessons learned on the road.

General Assembly
General Assembly’s curriculum and training programs offer a variety of tech, data, design, and business courses to keep your skills marketable and relevant to today’s work force demands. They have a campus in Midtown, Atlanta, but also offer online classes with both full- and part-time schedules. 

Tech Square Labs
TechSquare Labs is a workspace and incubator that works with startups and corporate design and invention teams. They invest via their own venture fund, and offer extensive coaching and support services to the TechSquare Labs community.

WeWork
WeWork provides collaboration space and community for small businesses and entrepreneurs all over the world, with five locations right in Atlanta. They have different packages and membership options, which is perfect for those looking to tailor their work space based on their individual needs.

Switchyards Downtown Club
Switchyards Downtown Club is a gathering place in downtown Atlanta meant for accelerating and growing consumer and design-focused companies. The building itself is 19,000 square feet and includes an expresso bar, 250 seat theater, 12 conference rooms, and a ping pong table.

Women’s Entrepreneurship Initiative (WEI)
The Women’s Entrepreneurship Initiative is an incubator in Atlanta whose mission is to empower, support, and provide resources to women as they aspire to open their own businesses.

A-H

Accessory Use

Accessory use means using a building or piece of land in a way that is different than its primary designation (See Primary Use). A musical rehearsal studio or massage therapy office located inside your house is an example of an accessory use. A “use” in city planning refers to the way a building or piece of land is designated to be used. For example, a piece of land may be designated as residential, meaning it can only be “used” as a home.

Accounts Receivable

Money that is owed by customers for goods or services that have not yet paid for.

Application Fee

A one-time fee paid at the time the application is submitted. Be aware that for some permits, you may have to pay for both the application and the permit. Application fees are usually not refundable and paying one does not guarantee you will receive the permit you applied for.

Assets

Assets are property that your business owns. This includes anything that has value, such as cash, accounts receivables, inventory, supplies, equipment, etc.

Branding

The identity for your product or service that differentiates it from competition.

Brick & Mortar

Brick and mortar refers to businesses that have physical (rather than virtual or online) presences – in other words, stores that you can physically enter to purchase merchandise. When the term came about, most buildings were made of brick and mortar. Though we use all kinds of building materials today, the term is still common.

Building Envelope
The maximum square footage and number of floors/building height allowed on a property by the city’s zoning restrictions.
Building Permit
Allows for new construction or construction activities within an existing building. Building permits are issued after the city has ensured that the proposed activity conforms with all city guidelines and regulations.
Business Entity
A business entity is established as separate from its owners to maximize tax strategies, create liability protection, and ensure asset protection. Corporations, limited liability companies, and sole proprietorships are types of common business entities.
Business Improvement District
A business improvement district is a geographically defined area within the City of Atlanta, in which services, activities and programs are paid for through a special assessment which is charged to all members within the district.
Business Personal Property
Any tangible property owned and used for your business, including all machinary, fixtures, office furniture, and equipment. In general, business personal property is all property owned or leased by a business except licensed vehicles, business inventory, intangible assets or application software
Business Plan
A business plan is an essential roadmap for business success. This living document generally projects 3-5 years ahead and outlines the route a company intends to take to grow revenues.
Cash Flow
A business’s cash flow is the measurement of cash flowing into and out of the business within a set amount of time. For example, you might bring in $100 in sales, but spend $50 in supplies within a given month.
Certificate of Occupancy

A document issued by the Department of Building and Safety, which verifies that a building complies with codes, laws and zoning and is thus approved for occupancy.

Change of Use

Any construction or remodeling that changes a facility into a different type of facility, for instance, if a print shop is changed into a restaurant. A change of use may trigger different zoning and permit approvals.

Conditional Use Permit (CUP)

Required approval for certain types of land uses and business activities, regardless of whether or not they conform to zoning requirements.

Crowdfunding

A method of raising capital in small amounts from a large group of people using the Internet and social media.

Demographics

A statistical view of a population, generally including age, gender, income, schooling, occupation and so on. Analyzing demographics of your customer base is very important in determining branding and marketing.

Doing Business As (DBA)

A DBA is a name a business operates under that is different from the legal name of the business. For example, the legal name for a home painting service might be Johnson Enterprises LLC, but the DBA might be Johnson’s Home Painting Services.

E-Commerce

E-commerce is the act of selling products or services over the internet. When you have an online presence through which you try to make a profit, you are involved in e-commerce.

Entitlement

Approval or permission by the City to use or develop land. Entitlements are required unless your building and all of your proposed business activities are permitted under the city’s zoning regulations.

Entity
Organization established as a separate existence for the purposes of taxes. Corporations, limited liability companies, and sole proprietorships are types of common business entities.
Entrepreneurship

The process of identifying and starting a new business venture and source and organizing the required resources while taking both the risks and rewards associated with the venture.

Fixed Costs

Fixed costs are the costs that do not change in relation to how much you sell. Paying rent or salaries are examples of fixed costs. They do not change if your sales or income increase or decrease.

Food Service Establishment (FSE)

A facility or business that provides food to the public. Examples of FSEs include restaurants, commercial kitchens, markets, food processing plants, caterers, hotels, schools, and hospitals.

Form 1099

A 1099 is an IRS form for the purpose of declaring income from non-salaried sources. Independent contractors should receive a 1099 by January 1 of each year from anyone they perform more than $600 of work for. Income reported to the IRS on a 1099 is taxable by the City of Atlanta if it does not qualify for a tax exemption.

I-Q

Liabilities

Items in which you owe money and/or debts. If the debt can be repaid in less than five years, it’s considered a short-term liability; debts that are to be paid in more than five years are long-term liabilities.

Microfinance

A source of financial services for entrepreneurs and small businesses lacking access to banking and related services.

Net profit

Revenue minus your costs AND tax.

Plan Check
A process where the Office of Buildings reviews and approves building-related proposals to ensure they comply with existing city laws, restrictions, and codes.

R-Z

Revenue

The money made from the sale of your product or service.

Rezoning

If a proposed development does not comply with the city’s existing zoning code, you may apply to change the zoning into one that will allow your development.

Variable Costs

Variable costs are costs that change in proportion to the number of units produced. For example, if you own a dog grooming business, dog shampoo is a variable cost. You only incur the cost based on the number of dogs you wash. Variable costs aren’t as risky as fixed costs because you only incur them when you sell your product or service.

Variance

A waiver of zoning requirements. Variances apply only to building restrictions (e.g., height, size), and not to allowable land uses.

W2

The IRS form for reporting employee income.

WorkSource Center

City-funded resource that offers free workforce development services for employers and employees.

YouthSource Center

City-funded resource that offers workforce development services to 16-18 year olds and GED Education Training for those 16 and older.

Zoning
Allowable land use and building restrictions for particular geographic areas, as defined by the City’s General Plan. If your project is not permitted by the zoning regulations, you will need to be apply for approval with the city.

The ATLINBusiness Portal is an invaluable tool for all our entrepreneurs and small business owners looking for the info they need to plan, launch, and grow their business.

Invest Atlanta

As the City of Atlanta’s official economic development agency, Invest Atlanta aims to advance Atlanta’s global competitiveness by growing a strong economy, building vibrant communities, and increasing economic prosperity for all Atlantans.

Advanced Technology Development Center (ATDC) Seed Capital Fund
ATDC at Georgia Tech is Georgia’s Technology Incubator. In addition to providing startups with the skills and opportunities to grow their customer base, they also support those who seek capital beyond what is available to them via traditional lending sources.

Atlanta Technology Angels
The Atlanta Technology Angels and Gwinnett Angels are two private groups of high-net-worth individuals that provide a platform for evaluating and selecting companies to fund. Neither group currently manages a fund or pool of money. Instead, investments are made by a handful of members interested in exciting business opportunities.

Atlanta Ventures
Atlanta Ventures invests in entrepreneurs in the ideas, product and market fit, and scaling stages, with a focus in Software As A Service (SaaS) companies in the Southeast region. They are in partnership with the Atlanta Tech Village.

BLH Ventures Partners
BLH Ventures looks for entrepreneurs with relevant experience, keen insights, or deep relationships with their fields. They focus on capital-efficient companies within the technology-enabled services, enterprise IT, consumer internet and e-commerce markets.  

Buckhead Investment Partners
Buckhead Investment Partners is a private equity and venture capital firm and seeks to invest in emerging growth companies.

CXO Collective
CXO Collective seeks to grow businesses that have a positive impact on customers, clients, and society. They provide buy-out, scale up, consultancy, and more services to business owners.

Forte Ventures
Forte Ventures is a Georgia-based multi-stage venture capital firm investing with corporate strategic partners in technology companies.

Fulcrum Ventures
Fulcrum focuses on entrepreneurs and management teams in the healthcare services, healthcare IT, software and SaaS, and tech-enabled service fields.

GRA Ventures
GRA Venture Fund is a public-private venture capital fund investing in research-driven, Georgia-based startup companies. It connects its portfolio to experienced business advisors and industry leaders, and provides industry and financial advice to is clients.

Imlay Investments
Imlay Investments is a private investment firm that funds early-stage technology companies. The Foundation helps entrepreneurial and established community organizations expand their capabilities and reach.

Mosley Ventures
Mosley Ventures is a venture capital fund investing in early stage technology startups in Atlanta and the Southeast. They primarily invest in security software, mobility and wireless, big data, and healthcare IT.

Noro-Moseley Partners
Based in Atlanta, Noro-Moseley Partners invests in early growth information technology and healthcare businesses with rapidly scaling revenue, a capital-efficient model, and a clear pathway to profitability.

Paparelli Ventures
Paparelli Ventures is a pre-formation investment company focused on entrepreneurs in the Atlanta technology market. They have funded over 16 Atlanta startups in the last 15 years.

Tech Square Ventures
Tech Square Ventures is an Atlanta based seed and early stage venture capital firm. They partner with entrepreneurs who are building startups in sectors that emphasize the strengths of the Southeast region and the area’s research universities.

Tech Operators
TechOperators is an Atlanta-based firm investing in emerging software companies with high growth potential. They specifically focus on opportunities to innovate and transform solutions for cyber security, enterprise productivity, and IT infrastructure.

TTV Capital
TTV invests in fintech businesses that serve the widely varying needs of the financial services sector and the consumers of financial products. Their mission is to partner with the best entrepreneurs and provide them with the resources and support they need to successfully build great businesses.

Accion
Accion is committed to bringing affordable small business loans to microentrepreneurs. Accion East has provided over $132 million since inception in 1991, helping to grow small businesses and strengthen the communities they serve.

Ace Loans
ACE is a non-profit organization that provides loans and business development resources to help its borrowers create and grow sustainable businesses which generate jobs. Their mission is to provide community economic development to underserved people and communities.

Engage
Engage is an independent venture fund, established and financed by some of the most influential corporations in the world. Our mission is to strengthen collaboration and partnership between leading corporations and top entrepreneurs.

Georgia Small Business Capital
A certified development company that assist healthy, growing small businesses, secure long-term, below market, fixed rate financing for acquisition of fixed assets. They also provide assistance and advisory services to companies considering the possibility of selling their business or contemplating an acquisition or merger.

Angel Atlanta
The Atlanta Technology Angels is a formal “angel” investment group, founded in 1998, that invests in early stage technology companies based in Georgia. The Atlanta Technology Angels is an active source of private capital and business experience to local technology entrepreneurs.

Construction

Demand for construction and infrastructure projects, big and small, is growing in our region. The construction industry offers many opportunities for entrepreneurs.

Download Kit

Food

Got a delicious recipe, want to start a restaurant? Atlanta has become a food paradise. This starter kit will guide you through the process of starting a food business.

Download Kit

Barber/Salon

If you are ready to show your talent as a barber and make an investment in your future, educate yourself in requirements, funding, permits, and site location.

Download Kit

Retail

Make your dream a reality, become a business owner, but before you do, make sure that you learn the necessary steps to make your business successful.

Download Kit

Create a Business Plan

Creating a business plan is one of the first steps you should take as a prospective business owner. It will help you to craft your game plan, hone your product, understand your customer base, and guide your decision-making to set up your business for success.

Plan a Business

Every business owner must choose a legal structure for their business to operate, register, and pay taxes within. The legal structure you choose should suit the type of services or products you will provide. Consider your options to find the best fit for your business.

Permitting

You’ve found a great building for your business, and now you want to make it your own. Find out if you need a building permit and if there are any accessibility upgrades necessary to become ADA (Americans with Disabilities Act) compliant.

Choose a Location

Do your research to find a great location for your business. Consider factors like demographics, lease terms, and whether your business is allowed by local zoning and building regulations before you sign on the dotted line.

Finance Your Business

Whether you’re looking for startup capital or considering a loan to finance the expansion of your business, a variety of opportunities are available through various lenders and programs.

Hiring and Managing

Hiring the right people is one of the most important things you can do for your business. Be sure to take advantage of local resources to help you on your way, and make sure you know your responsibilities as an employer.

Register Your Business

Registering your business is a key part of getting it up and running. All companies doing business in the City of Atlanta need to register with the city and depending on how your business is set up, you may also need to register with the county, state, or federal government. You can find the information you need to navigate the steps below.

Find a Location and Permits

Visit the Atlanta Permitting Portal to determine if a location is zoned for your type of business, see which permits you need, and what they cost. Get started!

Employer Identification Number (EIN)

Most businesses must register with the US Internal Revenue Service (IRS) to obtain an Employer Identification Number (EIN). Think of it as a social security number for your business. If you plan to hire employees, you will need to complete this step in order to pay payroll taxes. Most business owners find an EIN helpful for other business purposes, such as opening a bank account. You can apply for an EIN online for free.

Incorporate your Business Entity

If you choose to structure your business as a Partnership, Corporation, or Limited Liability Company, you will need to incorporate your business entity with the Georgia Secretary of State. Visit their website to make sure your business name is available and get tips on filing

Register a Business Name (“Doing Business As”)

If you’ve chosen a business name that is different from your first and last name (for instance, if your business is called “Jane’s Grocery” instead of “Jane Doe Inc.”), you will first need to make sure that no one else is using that name. Check to see if the name is still available, and then be sure to register the name to yourself so someone else doesn’t take it. This helps to avoid confusion from having a lot of businesses with the same name and will protect your business by ensuring that no one starts doing business using your business name.

Reserve your business name here.

Register for State and Local Taxes

All companies doing business within the City of Atlanta must register their business with the City and the State – Georgia Tax Center.

Rising costs, wage increases, and regulatory changes can all impact your business, but there are ways to navigate these waters and maintain a successful business.

Determine Your Expenses

To build your business preparedness, analyze the existing financial condition of your company by calculating your revenues and profits along with your expenses. This process will help you determine your cash flow and understand how to structure your costs, such as wages, supplies, rent, and other expenses. An accountant can be helpful in this regard; it also helps to gain bookkeeping skills or have a trusted bookkeeper to ensure that you are accurately recording your financial transactions, including purchases, sales, receipts, and payments.

Understand your inventory

To remain competitive, small businesses constantly have to find new ways to offer high-quality goods at a price point that is affordable to their customers. It helps to have a strong point-of-sale (POS) system or other reliable method to track your inventory, so you have a good sense of how much product you have and how often you need to order your products and supplies so that you can minimize your waste. If your financial assessment shows that the current cost of your supplies is too high to be profitable, consider exploring other vendors or work with your current vendor to renegotiate your agreement.

You can also use your point-of-sale or inventory system to understand what is selling well and what isn’t selling well and adjust your business model accordingly. Talking with your peers and customers, staying up to date on current trends, and attending trade shows are all good ways to understand if there are new products or services that you can offer to your customers that will help to grow your business, or if there are current products that you offer that are no longer relevant or popular. Having the ability to anticipate and adapt to the changing needs of your customer is a great way to make your business stronger.

Assess your prices

After you’ve determined your expenses, you’ll need to make sure that you can continue to turn a profit to stay in business. If your prices are not covering your costs, you may try to identify ways to reduce your supply and operational costs, or you may consider raising your prices. You’ll want to research what other businesses are charging for similar goods and services so that you remain competitive, or consider ways that you can change or rebrand your business and products or services to support a price increase.

Identify operational efficiencies

In addition to supplies and prices, you can also look at your business operations to find ways to decrease your costs. For instance, if you find yourself driving to the post office several times a day to mail packages, you might try different methods to bundle your deliveries or see if there are services that can do the deliveries for you to reduce your driving time and mailing costs. Or if you have very labor intensive or manual processes, you may consider new software or technology that can automate some of those tasks, freeing up time that can be put towards other parts of your business. Review all aspects of your operations and think creatively about whether there are ways to increase your business’ efficiency and productivity. If needed, a business process consultant may be able to find ways to decrease your operational costs.

Key Dates and Deadlines

Don’t miss any deadlines; mark important dates on your calendar so you can prepare for them in advance. Find due dates and links for additional information for important license renewals, tax statements, and reporting forms below.
  • License expires – December 31
  • Renewal deadline – February 15
  • Payment deadline – April 1
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