So you’ve decided you want to start your own online business?
E-commerce is the way of the future: you can cut the costs associated with a physical location, plus you get to choose your hours and keep all the profits.
Before you get carried away with dreams of striking it rich online, here is a checklist of six crucial considerations to help you get started on the right foot.
- Make core decisions regarding Business Structure.
If you’re reading this, you’ve likely decided that you want to operate online. That’s a great start, but are you looking to conduct business as a sole proprietor, or as a limited liability company.
In broad terms, a limited liability company offers liability protection not available to sole proprietors (Business Name). If you have your sights set high, you’ll want to consider incorporating early to get these benefits from the start.
- Lock down your Business Name
The importance of a good name cannot be overstated. Your name is your brand, it is how you present yourself to your customer, and it’s how your customers are going to find you. Before you get too attached to a name, you need to make sure it’s unique and available.
Performing a public search will allow you to quickly scour the complete list of registered business names and trademarks. You can also use AffordableLaw’s name search service.
What do you want your business to be called?
Your company’s name should be memorable. Users need to be able to remember the company name in order to share it with others.
Your company’s name should be spellable. If users can’t spell your company name, they won’t be able to find it when searching for your products and/or services.
Your company’s name should be engaging. Think about what your users will associate your company name towards? What feelings does company name evoke? Will they associate the name with the image of the company?
Before you settle for a name, you must make sure it is available as a domain and trademark.
- Register your Domain Name
Your domain name might be the same as your business name, and it might not. However, it makes sense to select a business name first, because while business names must all be sufficiently distinct from one another, domain names are a little more malleable. For example, changing the Top Level Domain leads to a different destination, ie affordablelaw.ng is different than affordablelaw.com or affordablelaw.net.
Likewise, if the specific domain you want is taken, you can add a descriptor to distinguish your domain: affordablelaw.ng could become affordablelawng.com.
After securing the domain, you’ll need to build the website. You want to have a website that looks professional and is fully-operational before you start operating.
Most startups won’t be able to hire designers right off the bat, but there are plenty of platforms you can use to build your website, so there’s no excuse for operating a website that looks something straight out of 1999!
- Get Legal Protection
If you plan to incorporate, there are some important legal documents that must be filed with the government, and legally required organization documents to set out the owners of the company, bylaws and other items. These documents can be confusing for first-time founders and it is often better to have a lawyer prepare them, or use AffordableLaw to ensure your business remains compliant.
- Setting up a Business Bank Account
Whether you incorporate or not, it’s always best to give the business its own bank account to keep your finances transparent. For a company, a new bank account is a requirement. A company is a separate person at law, and as such, it requires its own finances. Money in a corporate bank account belongs to the company, and is separate from your personal account. It’s important to clearly separate your personal and businesses finances to benefit from the liability protections offered by incorporating.
In order to open a bank account for your business you’ll need to get a Tax Identification Number. This is a compulsory requirement for both Sole Proprietors and Companies.
A more in depth guide of the benefits of a business bank account can be found here.
You’re now ready to start selling!
But that doesn’t mean you’re done. On the contrary, you’re just beginning. Making the product, testing it, marketing it, selling it, shipping it, you’ve got a lot of work ahead of you!
AffordableLaw is here to assist with tools and services to help you incorporate, manage, and grow your company.