1. Manufacturing: Maximum number of employees may range from 500 to 1500, depending
on the type of product manufactured;
2. Wholesaling: Maximum number of
employees may range from 100 to 500 depending on the particular product being
provided;
3. Services: Annual receipts may
not exceed $2.5 to $21.5 million, depending on the particular service being
provided;
4. Retailing: Annual receipts may
not exceed $5.0 to $21.0 million, depending on the particular product being
provided;
5. General and Heavy Construction: General construction annual receipts may not exceed $13.5 to $17
million, depending on the type of construction;
6. Special Trade Construction: Annual receipts may not exceed $7 million; and
7. Agriculture: Annual receipts may
not exceed $0.5 to $9.0 million, depending on the agricultural product.
Small businesses are
divided to many categories. There are many diverse categorizing based on the
size, field of activity, field of industry, type of ownership, and the annual
financial turnover of units. SBA has categorized small businesses in a
different way. This kind of classification refers to both activity and
ownership. SBA suggests entrepreneurs to allocate their businesses in one of
these groups:
1. Green Businesses: Green businesses not only benefit the environment, but also use Eco-friendly business practices as a means to market their products.
2. Startups & High Growth Businesses: Startups commonly are technology-based businesses and have high growth potential.
3. Home-Based Businesses: Many well-known companies like Apple and Ford started as home-based businesses.
4. Online Businesses: Establishing a business presence on the Internet can be a great way to sell and market goods and services.
5. Franchise Businesses: Franchises can provide an opportunity for ready-made business success, but they also come with a variety of challenges.
6. Buying Existing Businesses: Buying an existing business can be less risky than starting one from scratch.
7. Self Employed & Independent Contractors: Being a self-employed or an independent contractor can offer small business owners flexibility as well as challenges.
8. Women-Owned Businesses: Consists of women owned small businesses.
9. Veteran-Owned Businesses: Starting a small business is a tremendous opportunity for veterans. The federal government has programs specifically for veterans and the military community.
10. People with Disabilities: Starting a business can be a great opportunity for those with disabilities because of benefits such as work flexibility.
11. Young Entrepreneurs: Young entrepreneurs are the key to the U.S. nation's economic future.
12. 50+ Entrepreneurs: Using the experience of retirees to explore new business opportunities.
Steps to start a small business: There are many recommended steps in diverse resources on the Internet. One of the most reliable processes is mentioned on www.sba.com. According to the U.S. Small Business Administration, there is a series of legal activities “to plan, prepare and manage” a business that can be ordered in 10 common steps.
Step 1: Write a
Business Plan: Map out how you will start and run
your business successfully. There are many useful tools and resources to create
a business plan.
Step 2: Get
Business Assistance and Training: Take
advantage of free training and counseling services, from preparing a business
plan and securing financing, to expanding or relocating a business.
Step 3: Choose a
Business Location: Get advice on how to
select a customer-friendly location and comply with zoning laws.
Step 4: Finance
Your Business: Find government backed loans,
venture capital and research grants to help you get started.
Step 5: Determine
the Legal Structure of Your Business: Decide which form of ownership is best
for you: sole proprietorship, partnership, Limited Liability Company (LLC),
corporation, S corporation, nonprofit or cooperative.
Step 6: Register
a Business Name: Register your business name with your state government.
Step 7: Get a Tax Identification Number: Learn which tax identification number you'll need to obtain from the IRS and your state revenue agency.
Step 8: Register for State and Local Taxes: Register with your state to obtain a tax identification number, workers' compensation, unemployment and disability insurance.
Step 9: Obtain Business Licenses and Permits: Get a list of federal, state and local licenses and permits required for your business.
Step 10: Understand Employer Responsibilities: Learn the legal steps you need to take to hire employees.
Tax: Although there are
many kind of classification for small businesses, all of them have to pay tax. IRS
(the Internal Revenue Service) has prepared
a basic checklist for doing official steps related to paying tax. As it is
mentioned on www.irs.gov, “this list
should not be construed as all-inclusive. Other steps may be appropriate for
your specific type of business.” Meanwhile, each state has additional
requirements for starting and operating a business.
Step 1: Apply for an Employer Identification Number (EIN) if applicable. An Employer Identification Number (EIN) is also known as a Federal Tax Identification Number, and is used to identify a business entity. Generally, businesses need an EIN. It’s best to be sure your organization is formed legally before you apply for an EIN.
Step 2: Select a Business Structures. When beginning a business, you must decide what form of business entity to establish. Your form of business determines which income tax return form you have to file. The most common forms of business are the sole proprietorship, partnership, corporation, and S corporation. A Limited Liability Company (LLC) is a relatively new business structure allowed by state statute. Legal and tax considerations enter into selecting a business structure.
- Sole Proprietorships
- Partnerships
- Corporations
- S Corporations
- Limited Liability Company (LLC)
Step 3: Determine Tax Years: A “tax year” is an annual accounting period for keeping records and reporting income and expenses. You must figure your taxable income on the basis of a tax year and file an income tax return. An annual accounting period does not include a short tax year. The tax years you can use are:
- Calendar year - A calendar tax year is 12 consecutive months beginning January 1 and ending December 31.
- Fiscal year - A fiscal tax year is 12 consecutive months ending on the last day of any month except December. A 52-53-week tax year is a fiscal tax year that varies from 52 to 53 weeks but does not have to end on the last day of a month.
Step 4: Pay Business Taxes. The form of business you operate determines what taxes you must pay and how you pay them. The following are the four general types of business taxes.
- Income Tax
- Estimated Taxes
- Self-Employment Tax
- Employment Taxes
- Excise Tax
Competition and Tools for analyzing: The most common tool that is used for
analyzing competitive environment is SWOT. According to Darrell Zahorsky in his article “A Business Owner's Secret Weapon: Swot
Analysis” A SWOT
analysis may sound like a form of mission planning for James Bond. A SWOT
simply stands for: Strengths, Weaknesses, Opportunities, and Threats. Each area
forms a box on a grid and you fill in each section to help formulate a
marketing strategy.
Strengths and weaknesses focus your business to look internally at
what your business can do. Many businesses are great at looking inward but fail
to look outside their company. Threats and opportunities are external; focusing
on the conditions of the real-world. This is where a SWOT analysis is helpful.
It challenges you to see beyond your company walls to determine what
opportunities are open for your company and how to capitalize on your
strengths. While most of your analysis will be subjective, the SWOT can provide
multiple benefits to your small business. These benefits can include:
- Insight into where your business can focus to grow.
- Understand the industry structure by using a SWOT in your business plan.
- Focus your advertising and marketing on areas that give you a competitive advantage in the marketplace.
- The foresight to see looming threats and react proactively.
The most important take-away from this exercise is to apply this
knowledge to your small business. Take all necessary actions to reduce the
threats to your company and position yourself to take advantage of the
opportunities.
Online and Free Resources to Startup in Oregon:
According to SBA, there are a number of available programs to assist startups, micro businesses, and underserved or
disadvantaged groups. Even you can save money when starting
or expanding your business by using government surplus. From commercial real
estate and cars, to furniture, computers and office equipment, find what you
need for your business in one place.
Most of services are given by local institutions and organizations.
According to SBA, there are many courses, training, resources, programs and
business advisors to help entrepreneurs with starting a small business in
Oregon. These services are available in 19 Small Business Development Centers
(SBDCs) across Oregon offer a full range of services and information for small
businesses of all types. They have a resource team that can help you in many ways,
and they have been helping new and existing business owners for more than 30
years. These centers are located in Albany, Bend, Clackamas, Grants Pass, Gresham,
Eugene, Klamath Falls, La Grande, Lincoln City, Medford, North Bend, Ontario, Pendleton,
Portland, Roseburg, Salem, Seaside, The Dallas, and Tillamook.
One of the most important centers is located at Portland Community
College (Portland Community College SBDC). The Portland SBDC offers a wide
range of services for small businesses no matter their stage, from pre-venture
start-ups to mature businesses.
Here are some of services that are available at Oregon’s SBDCs.
1. Advising: Meet with a business advisor who can provide advice on a wide range
of business topics.
2. Training: The workshops,
seminars and online training offerings will help you sharpen your business
skills with useful informational on a particular topic. Sign up for a class at
one of the Centers, attend an informational presentation, or take advantage of
an online webinar that you can access any time of day from your home or
business.
3. Bizcenter
Online Learning: This new
resource offers online training in areas of interest to small businesses
including social media, search engine optimization (SEO) for websites, customer
relations management, government contracting, and other topics. Many of these
valuable resources are free for businesses that are working with a local SBDC
advisor.
4. Technology
Impact Program: Oregon small
businesses can take advantage of new online courses and business planning
software, thanks to an innovative partnership between the Oregon Small Business
Development Center Network (OSBDCN) and Palo Alto Software, the world’s leader
in business planning software. This partnership culminated in the launch of the
Technology Impact Program (TIP) in 2012 and makes these online business courses
and tools easy to access by businesses across Oregon.
5. Hispano
Resources: SBCDs provide
Hispanic small businesses with services to start and grow their business,
business information, and access to partners who are also interested in
supporting Hispanic businesses.
In addition, there are some useful programs that
Oregonian entrepreneurs can attend and use the advantages. According to Oregon
Small Business Development Center Network, some of these programs are consist of:
1. Grow
Oregon: This program is
for companies that have 10–99 employees, annual gross sales of $1,000,000 to
$50,000,000, and meet other criteria.
2. Global
Trade: This program offers
training on a variety of topics involving international trade including global
business management, trade finance, international logistics, international marketing,
and legal and cultural issues.”
3. Capital
Access: Capital Access
Team (CAT) provides loan packaging, financial analysis, finance strategies, and
lender relations to businesses statewide.
4. Assistance
with applying for federal grants for research and development (SBIR/STTR): The auditors assist
qualified Oregon companies in the preparation of proposals for Small Business
Innovation Research (SBIR) and Small Business Technology Transfer (STTR)
awards. SBIR/STTR are competitive federal grant programs that award funding to
small businesses for research and development that has the potential to
commercialize new technologies.
5. Small
Business Management: This three-year
program includes classroom sessions, one-to-one coaching from an advisor, and
the opportunity to learn from other small business owners.
6. Veterans
Mean Business: This program
provides one-on-one advising and classroom training for military veterans who
operate a small business. The program is funded by a grant from the US Small
Business Administration.
Sources:
http://www.sba.gov
http://www.lendio.com/blog
http://smallbusiness.chron.com
http://www.irs.gov
http://www.bizcenter.org
http://www.dummies.com
http://sbinformation.about.com
