How to start a top home based business in a litigious society is a lot like asking how to go clam digging in shark invested waters. While there is a modicum of safety, the fish are always nearby and failure to observe the advancing waters will result in an unscheduled though anticipated meal for the sharks. It is wisest to break down the various steps to starting and protecting your business:
1. Create a business plan. How many businesses get started without one is a staggering number that defies explanation! Of course, these are also the businesses which are doomed to fail not too long thereafter. A properly executed business plan will define and limit the scope of the business, set financial benchmarks that serve to identify success, failure, and needs to rethink strategy, scope, expansion, or marketing, and it will point out any areas that may invite governmental intervention.
2. Identify the areas that may bring you in contact with governmental rules and regulations by virtue of the business’ nature. In other words, a food business is certain to require permits and inspections; a daycare business will need inspections and licenses, and so forth. Compile the names of the applicable government agencies, their contact information, and then investigate the steps that you need to take to get your business off the ground in a legal manner.
3. Consult with your tax accountant about tax liabilities and filing requirements.
4. Visit with your small business attorney to ensure that you and your personal assets are protected. Generally speaking, this requires the formation of a limited liability corporation and while it is easy to accomplish, it is not unwise to have a legal professional look over the papers prior to filing them.
5. Contact your insurance professional to discuss your venture and explore any insurance needs that may come up. This is particularly crucial if you are planning on running a top home based business exclusively out of your home or if you will be transporting consumers in the scope of your activity. Do not rely on your run of the mil home owner’s insurance or standard car insurance to foot the bill if something happens to your clients during working activities.
Although one would like to believe that how to start a top home based business is as simple as deciding to turn a hobby into a professional money maker, the sad reality showcases that because of litigation – either private party lawsuits or governmental actions brought against you and your business – many a home based business entrepreneur will have to close her or his doors within just a few short months of throwing them open.
Perhaps not surprisingly, the frustration of these thwarted would be entrepreneurs is tangible when it comes to light that with but a bit of foresight, protection, and savvy engineering they could have all but suit proofed their business! Do not become part of that group and instead choose to have your ducks in a row before you actually start your business and open it to the public.
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