This document provides information and resources for starting a business in the community. It lists local business partnerships that provide support services and outlines various paths to business ownership, including starting a direct sales business, buying an existing business, buying a franchise, or starting your own business. It then discusses business planning, licensing and registration requirements, insurance needs, taxes, and other considerations for starting a business. The document aims to help new entrepreneurs by lowering the risks of starting a business through planning and using available resources.

1. Community Business
The ABC’s of Starting A Partnership
Business • Women’s Business Center of Northern VA
703-778-9922 www.wbcnova.org
• Small Business Development Center
• Business Finance Center
Lisa Y. Goodman, Director
• Business Incubation Center
The Women’s Business Center of Northern Virginia
7001 Loisdale Road, Suite C • Hispanic Entrepreneur Program
Springfield, Virginia
703-778-
703-778-9922 phone 703-768-0547 fax
703-768-
http://www.wbcnova.org
• Financial Education Center for WE
703-768-
703-768-1440 www.cbponline.org
Your ABC’s
Is Self Employment For You?
B
A Business Planning C What are your main concerns ?
Accountability Banking Controls
Assessment Breakeven Cash Flow
Access Beating the Odds Considerations
Cost
Customers
Paths to
Business Ownership
Starting a direct sales business
Personal Assessment
Buy an existing business
Lifestyle Assessment
 Buy a franchise
Business Assessment
 Start from scratch
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2. Starting A Business Under A Corporate
Umbrella (Intrapreneurship)
(Intrapreneurship A few words of advice …
Advantages
• Build in support Honestly determine your true motivations
• Established business plan Pre-determine your special market niche
• Cooperative Marketing Make sure your support system is in place
• Relatively Low start-up
start-
• Training and Management guidance/mentoring Determine start up costs
Research the best companies
Disadvantages
• Highly selective screening process
• Licenses required vary state to state
• Must bring your own market niche
• Must be highly self-motivated
self-
Starting a Direct Sales Business
Advantages
• Build in support A few words of advice …
• Established business plan
• Home based
• Low start-up
start-
• Potential for large income in short amount of time  Be careful of new MLMs (they come and go)
 Don’t reinvent the wheel
Disadvantages  Take advantage of all training opportunities
• Not always taken seriously
• The stigma of MLMs  Be teachable and trainable
• Bad experience of others may be haunting
Buying an Existing Business
A few words of advice …
Advantages
• Takes less time to get established
• Established track record  Seek independent advice
• Customers and suppliers in place  Insist on seeing past records
• Previous owner as “mentor”
 Is this a “bankable” deal?
Disadvantages  Watch for warning flags
• Creativity is limited
• Usually more expensive  Be willing to walk away from the deal
• Structuring the deal may be difficult
• Buying the Bad along with the Good
• Discover too late the “real” reason they sold
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3. Buying a Franchise
A few words of advice …
Advantages
• Shorter lead time to get started
• “Turn-
“Turn-key” operation  Review the agreement with lawyer
• Lower risk  Are other franchise owners happy?
• Brand recognition
 Costs comparable to other franchises?
Disadvantages  Territory and competition?
• High start-up and ongoing costs
start-
 Is the Franchise sound?
• Limited flexibility
• Franchisor may not be reliable
• May be difficult to exit business
Starting Your Own Business
A few words of advice …
Advantages
• Self Satisfaction
• Flexibility  Other sources of income for living
• Control
 Everything takes longer than expected
Disadvantages
• No Guidelines  Everything costs more than expected
• Long time to get established
• Limited return during start-up
start-  Don’t be in such a hurry to get started
• Uncertain Income
Your Rich Aunt Last Wish Business Planning
• Put the money in a savings account.
Return = $ 5,000 per year
• Give it to Charity
Return= Self- esteem, change the
Self-
• Give it to me so I can start my own business
Return = $ 11,000 per year
(In monthly payments of $1,000)
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4. Why Write A Business Plan? Business Plan Outline
 Helps you maintain a “proactive” status
 Points everyone in the same direction
 Helps clarify opportunities
 Stimulates development of new
opportunities
 Focuses attention on important questions
 Increase chances of success
I. Executive Summary II. Mission, Goals & Objectives
 Opening Arguments  Mission Statement
 Condensed Version of Business Plan  Goals & Objectives
 Highlight Key Segments  General Description of the Business
Stage of development
 Three “Cs”
General growth plan description
 Clear
 Concise
 Convincing
III. Background Information IV. The Marketing Plan
A. The Industry
 Background Industry A. The Products/Services
information
Products/Services Description
 Current/future
industry trends (size, Features/Benefits
growth) Life Cycles/Seasonality
Growth Description
B. Your FIT in the
Industry (Future Products/Services)
 Small Businesses
 Niche Segments
http://www.census.gov/epcd/ec97/industry/E333313.HTM
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5. B. The Market Analysis C. Marketing Strategies
Customer Analysis Product Features vs. Benefits
Competitive Analysis Place: Location/Distribution
Market Potential Price/Quality Relationship
Current Trade Area Description
Promotional Strategies
Packaging
Market Size & Trends
Public Relations
Sales Volume Potential (Current & Growth)
Advertising
V. Organizational Matters VI. The Financial Plan
A. Business Structure,
Management & A. Financial Worksheets
Personnel – Growth (or Start-up) Expenses
Start-
 Business Structure
– Advertising Budget
 Management
– Sales Forecasts
 Personnel
 Outside B. Cash Flow Projections
Services/Advisors – Break Even Analysis
 Risk Management – Monthly Cash Flow Projections w/Assumptions
C. Financial Statements
B. Operating Controls – Income Statement
 Record Keeping
Functions – Balance Sheet
 Other Operating
Controls
Choosing a Business Entity Factors to Consider
• Sole Proprietorship  Legal Restrictions
• Partnership
– General  Potential Risk/Liabilities
– Limited
• Corporation  Earnings Distribution
– C-Corporation
– S-Corporation  Capital Needs
• Limited Liability  Tax Advantages/Disadvantages
Company
 Duration of Business Operation
Formation Assistant: http://www.bizfilings.com
http://www.bizfilings.com/
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6. Sole Proprietorship Partnerships
Advantages
• Easiest, least expensive form to start Advantages
• Fewer reporting requirements • Few Formalities
• No double taxation • Combination of resources and talents
• Owner’s personal income taxes offset by business • Same as Sole Proprietorship
losses
Disadvantages
Disadvantages • Unlimited liability for all partners’ actions
• Unlimited personal liability • Distribution of power of each partner
• Potential dissolution at owner’s death • Dissolution upon death of partner
• No tax benefits • “Pass-
“Pass-through” of income to partners
• Owner is personally responsible for taxes on • No income splitting
business income • No tax-free fringe benefits
tax-
• Limited ability to raise capital
Limited Liability Company C-Corporation
Advantages
Advantages • Limited liability of shareholders
• Limited liability for members without limits • Perpetual existence
• Increased ability to raise outside capital
on management participation • Ownership transfer through sale or gift of stock
• Flexible ownership and capital structure • Only ones that can fully deduct health insurance
• Avoids double taxation and have more options regarding pension plans
• Flexible allocation of profits among members • Favorable tax treatment for employee benefits
Disadvantages Disadvantages
• Cost/Complexity of establishing and manage • Time consuming and expensive to establish (+ $500)
• Time consuming and expensive to manage
• Poor tax treatment of fringe benefits • Annual reporting requirements
• Laws are still evolving • Double taxation
S-Corporation
Advantages Request:
• Taxed at individual shareholder level
(“pass through”)
• Same as for C Corporation
• Favorable tax treatment for employee health Business Registration Guide
insurance
804-371-
804-371-9733
Disadvantages
• Except for tax consequences, Same as C-Corp
C-
• Shareholder limitations (100) Or go on line:
• Shareholders must be individuals http://scc.virginia.gov/division/clk/brg.htm
• Limited to one class of stock
• Must be citizens or permanent residents
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7. Licenses & Registration Insurance
State (www.virginia.gov)
• Is your name available?
• Register (if applicable) with State Corporation • Liability (General, Product, Professional)
Commission
• Property
• Do you Need a Special Business License?
• Tax Registration (form R-1)
R- • Umbrella (house, car)
Federal (www.irs.gov)
• Worker’s Comp (3 or more employees)
• Obtain an EIN number (form SS-4)
SS-
Local (county/city) • Unemployment Insurance (1 or more
• Home Occupation Permit employees)
• BPOL License
• Trade Name Registration
Tax Obligations RESOURCES
• Federal
– Estimated Quarterly Taxes
– Payroll Taxes
– Self-Employment
Self-
• State (Income, Sales & Use, Litter,
Tire, etc.)
• Local (Personal Property, Real Estate,
etc.)
Small Business Administration SBA Programs
• Hub zone
• SBDCs
• 8(a) Certification
• Women’s Business Centers
• Pro-Net
Pro-
• Business Information Centers (now Central Contractor Registration or CCR)
• Loan Guarantee Programs • SBIC
• Micro-
Micro-Loan Programs • SBIR
• SCORE
www.sba.gov/dc
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8. Lower The Risks of a
Start-
Start-Up
 Don’t sell what you want -- sell what your
customers want Next Steps …
 Marketing -- even on a shoestring-- is essential!
shoestring--
 Learn to manage your finances (personal and
business) - cash flow, price, savings…
 Be prepared to become tired & discouraged
 Research - use facts to substantiate insights &
hunches
 Follow your strengths & interests
 Plan, Plan, Plan!
My Work Plan
Activities Month 1 2 3 4 5 6 7 8 9 10 11 12 Small Business Toolkit Series
Define your ideas
Decide what business to start Class 1 - Business Planning and Financing for Growth
Assess the impact on your life and family Develop a comprehensive business plan, complete with financial data.
Locate Sources of Business Advice/Support
Obtain necessary skills Class 2 – Tax Planning & Bookkeeping
Define business objectives
Pick a name and a logo for your business Set up a business accounting system and plan for annual tax reporting
Do some market feasibility research
Search for different locations Class 3 - Marketing, Legal & Risk Planning
Begin writing your Business Plan Find your customer and get their attention on a budget that works!
Choose legal form for your business
Setup a recordkeeping system
Learn how business entity and insurance choices help effectively manage risk.
Establish relationship with a banker
Open business checking account First Friday’s Networking Breakfast
Prepare cash flow projections
Define amount of investment you'll need Network with other women and hear a professional guest speaker.
Prepare financial statements
Obtain license, insurance, permits… Accounting Software Classes
Secure Financing
Prepare your operative plan QuickBooks Pro
Set up office and operational space
Purchase busines cards, office supplies Special Series
Hire staff Check out the Calendar for the latest series!
Cut the ribbon !!!
Questions?
Contact Information:
Women’s Business Center of Northern Virginia
7001 Loisdale Road – Suite C
703-778-
703-778-9922
www.wbcnova.org
info@wbcnova.org
Lisa Y. Goodman
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