About 400,000 small businesses start up each year. Do you know what documents you need to open a small business? You need a small business checklist to organize the necessary business documents!

The small business documents you need include your insurance, a business plan, and tax documents. Knowing the steps to start a business can help you get off the ground. 

Check out these five necessary documents to open a small business.

1. A Small Business Checklist Begins With Insurance 

One of the many documents you need to open a small business includes proper insurance. You’ll need liability insurance, but other insurance documents can protect you from malpractice or if you sell a faulty product. 

When you assemble your small business documents, consider a business owner’s policy. know more about Insurance Do I Need For A Small Business .

2. A Business Plan

Small business documents include developing a business plan to lay out the goals of your business in writing. In one of the first steps to starting a business, you can dictate management, marketing, and sales strategies and how you will develop products. 

A business also weighs risks and benefits. 

3. Tax Documents

As part of your small business checklist, you must have the proper tax documents. The correct business documents for taxes include an employee identification number and sales tax identification. You don’t need a federal tax ID if you are a sole proprietor. 

Check with a tax attorney to ensure you have the proper small business documents. Setting up the correct tax documents will make tax time easier when you start a business.

4. Legal Documents

Contracts, agreements, and even noncompete clauses are legal documents for your small business checklist. These legal documents will make sure you have the proper system in place if you disagree with a vendor or employee.

You can draft these business documents yourself; however, an attorney can make sure these legal documents express your needs. 

5. Permits and Licenses

Permits and licenses are among the small business documents you’ll need to open a business in many communities. 

Food businesses, for example, need the proper licenses from the health department or a license to sell alcohol. Other businesses need the proper permits to have live music. 

Before opening your business, check with the jurisdiction to find the proper permits and licenses. You don’t want to incur fines or penalties, which could cost you more.  

So you want to start a business – congratulations!  Once you get over the initial excitement, it’s time to break down the process of launching your startup into manageable chunks.

You might get overwhelmed with the sheer number of items on your to-do list. But not to worry; I’ve broken down this startup checklist into the primary tasks you need to do now, and those that you can defer until later.

A 30 Point Checklist for Your Startup

Do the following tasks either before launch or during the early days of your startup.

1. Determine viability

Be brutally honest.  Your startup needs to be something you can make a profit doing or delivering.  Ask yourself: would you buy it? Run the numbers: will customers pay enough so that you can cover costs and make a profit?   Here is a list of 29 more questions to ask, attributed to noted investor Paul Graham.

2.  Create a business plan

It’s easy to convince yourself that you don’t need a business plan, but creating a business plan with financial projections forces you to think through details. Keep your plan a living breathing thing that you revisit and adapt regularly.

3.  Figure out the money

Most startups take a lot more time to get off the ground than you expect. Know where your living expenses for the first year will come from (savings, a job, spouse’s income, etc.).  If you need financing for the business start investigating as soon as possible.

4. Get family behind you

Spend time to make sure your spouse and other close family ‘buy into’ your startup.  You’ll have enough challenges without resistance from family.

5. Choose a business name

You want a name that will stick in your target audience’s heads. And it shouldn’t already be taken by another company. Do Google searches and use a corporate name search tool to see if the name you have in mind is unique. Check at the state and Federal level.

6. Register a domain name

Get a matching domain to your business name.  An AOL email address or a website with free hosting and a name like mysite.wordpress.com makes it seem like either (a) you are not running a real business or (b) you don’t plan to be around long.

7. Incorporate / figure out legal structure

Incorporating your startup can protect your personal assets. Talk over structure (corporation, LLC, sole proprietorship) with your attorney and accountant.

8. Apply for an EIN

An Employer Identification Number (EIN) helps you separate yourself from your business. You’ll need it if you plan to incorporate your business or open a business bank account.  Plus, with it you can avoid giving out your social security number (an opening  to identity theft). 

9. Investigate and apply for business licenses

You may need one, if not several, business licenses for your startup, depending on your industry and where you are located.  Most licenses are at the state or local level.  Here in the United States, the SBA has a helpful business license and permits tool.

10. Set up a website

Get your website up and running as soon as possible. Today, it’s necessary for credibility.  Even if your product is not yet built, you can start with company information.

11. Register social media profiles

Getting set up on the major social media channels (Facebook, LinkedIn, and Twitter, to start) will make marketing on them later easier. Also, it’s important to reserve your brand as a profile name.

12. Start your revenue stream

Start generating revenue as soon as possible.  At the early stages of a startup there is never enough money – resist the temptation to wait until things are “perfect.” Oh, and get your lawyer to create any customer contract forms necessary.

13. Rent retail or office space

If you’ve got a brick-and-mortar business, you’ll need to sort this out early. If you plan to run a retail business, pay attention to foot traffic, accessibility, and other factors that will affect the number of people that will walk in your store. EXCEPTION: If you don’t have a brick and mortar or retail business, then hold off renting an office as long as possible to avoid saddling your startup with lease payments.

14. Order business cards

As a startup founder, you’ll be doing a lot of networking, so order plenty of business cards. They are inexpensive enough that you can reorder them later if things change. Without cards you lack credibility.

15. Open a business bank account

It’s all too easy to use your personal bank account to pay for business expenses, but it becomes a gnarl to untangle later.

16. Set up your accounting system

Once you have your bank account set up, choose an accounting program. Start as you intend to go. Few things will doom your business faster than books that are a mess.

17. Assign responsibilities to co-founders

If you have one or more founders, it’s imperative that you decide who will do what up front. Put it in writing.  Co-founder disagreements can destroy your business.

What You Can Do A Bit Later

While you don’t want to put off these tasks too long, they don’t need to be checked off your list before you launch.

18. Upgrade your smartphone and choose apps

As an entrepreneur you are going to be on the go – a lot. I can’t emphasize enough how useful a good phone with good business apps can be, in running your startup. Get a credit card swipe device to accept payments, too.

19. Find free advice

Your local SBA office, SCORE, and other small business resources can provide you with free advice, access to business templates, and other tools.

20. Consult your insurance agent and secure coverage

Depending on the type of business you’re starting, you may need insurance of one kind or another, like liability, workers’ comp, or health insurance, especially if you hire full-time staff.

21. Hire your first employee

Depending on the type of business you have, you may need staff from day one (retail) or you may be able to outsource to  freelancers, interns, and third-party vendors for a while (service and tech businesses).   Just remember, trying to do everything yourself  takes you away from growing the business.

22. Line up suppliers and service providers

Finding a good source of inventory is crucial, especially in certain types of businesses (retail, manufacturing). Beyond inventory, line up good reliable suppliers and service providers so you don’t have to sweat the details.

23. File for trademarks and patents

The best thing to do is consult an attorney early about the need for patents, especially.  Get the advice early. Then you may be able to defer filing for a while, depending on the nature of your business.

24. Work your  network

Reach out to former co-workers and colleagues, as well as friends and family. Don’t pressure them to buy your products or services.  Instead, tap into them for introductions and help with other things on this startup checklist.

25. Don’t waste time on “partnerships” 

Be careful about wasting time on “business partnership” discussions. Your business won’t be attractive to potential partners unless and until you start making headway. Focus your precious time to make sales and get customers.

26. Refine your pitch

You need a good elevator pitch for many reasons: potential investors, customers, prospective new hires, bankers.  If you can’t persuasively and clearly pitch your business, how can you expect key stakeholders to buy in?

27. Refine your product, and marketing and sales approach

As you go along you will learn more about the marketplace.  Use customer feedback to refine your product and service offerings, and your go-to-market approach.

28. Secure your IT 

Whether you’re running a tech company or not, you likely have sensitive data on computers and devices that you want protected. Protect it from intrusions and disasters.  Back it up!  IT problems can derail a fledgling company.

29. Get a salesperson or sales team in place

In many startups the business owner starts out as the chief sales person. But to grow you need a dedicated sales function, so you can focus on activities other than day-to-day sales.

30.  Get a mentor

It’s all to easy easy to work “in” your business rather than “on” it.  As Michael Gerber tells us in The E-Myth, we need to be working “on” our businesses if we want them to grow and flourish.A mentor who has succeeded in your industry can provide you with priceless advice and serve as a sounding board.

Your checklist might be longer than this, but organizing what needs to be done before you launch and what you can take care of down the road makes it easier to prioritize your tasks.

Five Types of Documents for Your Small Business Checklist

Starting a small business means putting together a small business checklist to get your operation up and running. You’ll need insurance, a business plan, and tax documents. You also can’t ignore legal paperwork and the proper permits.

Once you have the correct documents in place, you can open your business and start making money! It will give you peace of mind knowing that you followed the right plan.

Business Startup Checklist

Before you decide to quit your full time high paying job to take a plunge and start your own business, ask yourself if you have the traits and caliber to get down on the ground and do the job? Do you have it in you to be an aspiring entrepreneur? Starting a business is definitely not a child’s play and at the same, it is not a Herculean task either. If you have a plan, adequate funding and the knowledge to set it up with appropriate marketing and business development skills – then you are on the right path! The key to setting a new business from scratch is to be organized and most importantly to “prepare a checklist”. The actionable items on your checklist will help you start your business efficiently and effectively. A checklist will keep you aware of the work completed, work that requires immediate attention and work that’s pending. So let’s get started.

The Entrepreneur Checklist: Ready to start a business?

When asked, most entrepreneurs are clueless and do not have a concrete answer to the question “why do you want to start your own business”? The answer given by most entrepreneurs instantly gives away the longevity of the new business you wish to start. The clarity or the lack of clarity behind the reason to start a business will make or break your business. Your vague idea of starting a business or a clear vision will make your business failure or massive success. So the first question you need to put down on your checklist is:

• Why do you want to be an entrepreneur?
  • “I hate my boss, I want to be my own boss, I hate my job” so on and so forth are some of the clichéd answers to the question asked. Does this reason keep you going when the difficulty in your business starts to brew! This is where you need to pause and rethink- Do you have it in you to become an aspiring entrepreneur?
• Do you possess the required business skills?
  • When you ask yourself this question you will need to run an analysis about yourself.
  • You will have to analyze your strengths, weakness and personal skills.
  • You will have to prepare a SWOT about yourself – identify your strengths, weakness, opportunities and threats.

The Idea Checklist: What will be a good idea?

Once you have decided to become an entrepreneur and launch a business, follow this checklist to brainstorm and narrow down on a business idea.

• Make a list of your hobbies, skills, and talents.
  • List out your skills, talents, educational background, expertise and experience. Find businesses wherein your existing skills or experiences could be used to provide a competitive edge.
• Make a list of the business ideas you thought of or felt passionate about.
  • Figure out what you will make you excited to get up every day and look forward to the day. Because every great entrepreneur in history made their success; doing what they love and loving what they do.
• Brainstorm, narrow down and decide.
  • Brainstorm ideas with friends, family, potential co-workers, etc., and narrow down a business and business model. Make your final decision based on what best suits you and makes you feel confident and comfortable.

The Market Analysis Checklist: Will the idea work?

Once you have decided on a business idea, follow this checklist to fine-tune the idea and get an understanding of the market. It is important to do this checklist diligently to avoid costly mistakes in the future.

• Analyze the customers.
  • Market analysis is an extremely crucial step in setting up a new small business. Talk about the product or services you wish to offer with potential customers. This step will help you check if there is a demand for your business in the area. If you have done the analysis and feel there is the demand for your business, then you should work further on the technical analysis, manpower requirement analysis and financial requirement, etc.
• Analyze the competition. 
  • Do a SWOT to check the level of competition you will have in the area where you will establish your business.
• Analyze the opportunities.
  • Check and analyze the monetary requirements to set up your business and work on a financial projection. Check the possible risk factors your business can face as well as the level of benefits your business can receive once you set up shop at the decided place.

Business Plan Checklist: The final step before launch!

The business plan checklist is your chance to put down everything you have learnt so far about the market and your business plan into words. This step is often forgotten by Entrepreneurs; but, if done properly it can help you quickly find customers, obtain a bank loan or private equity investment to build a successful business.

• Choose a business name for your venture.
  • Ensure the business name is in line with the company or LLP naming guidelines and get the business name trademarked.
• Prepare a short and succinct introduction to your business.
  • Keep it short. Preferably less than five lines.
• Prepare a mission and vision statement.  
  • This step is important and the mission and vision statement should be written down.
• Write an introduction about the promoters. 
  • Provide information like educational background, work experience, expertise, etc.,
• Provide information about the business model.
  • The problem your business is trying to solve.
  • How your business will solve the problem.
  • Existing solutions.
  • How big is the market for your business?
  • How will your business make money?
  • Operational strategy and marketing strategy.
• Compile financial estimates.
  • This is a mandatory and very important step in establishing a new business. Prepare cash-flow statements with the amount of money the business will generate, the estimated expenditure, etc., It is important to plan for funding wherever there is a shortfall in funds.
• Add a professional touch by creating a PowerPoint presentation for your business.
  • Make a long presentation with about 15 slides and a short presentation with about 5 slides. This will help you immensely while raising funds for your startup.

Finance Checklist: Is there money to start and sustain the business?

Once the business plan is ready, focus on funding your business and having the cash necessary to start and sustain your business for at least a year. A well-drafted business plan will be vital in this step for the success of your startup. Think about the following points and have answers:

• Will you be using your savings?
• Use the resources and fund from a friend by partnering with him/her?
• Will you generate funds from family and friends?
  • Will you be paying them back in cash or kind?
  • If cash what percentage of interest will you add to the money borrowed while returning?
• Will you seek assistance from venture capitalists, private equity firms, angel investors or others?
• Will you seek a bank loan?
  • Do you know the process to apply for a bank loan?
• Will you seek assistance from NGO’s or institutions that assist new business startups with seed funding?

Legal Checklist: Will you legally safe?

Once the money is available, talk to an IndiaFilings expert about setting up the business and the required business registrations. Know the answers for the following questions to ensure your are legally established and safe.

• What business entity to choose? Know the advantages and disadvantages.
  • Private Limited Company
  • Limited Liability Partnership
  • Proprietorship
  • One Person Company or others.
• Will you require any tax registration?
  • Is your business required by law to have a GST registration?
  • Is your business required by law to have a TAN registration?
• Will you have to file periodic returns to the government?
  • What are the due dates for filing of returns?
• Will the business require trademark or copyright or patent registration?
• Are there any special licenses required from regulatory authorities?
  • Any business that involved food would require FSSAI Food Business License.
• Are there any licenses or registrations required from state or central government?

Launch Checklist: Taking the first steps.

So once the money is available and you have a basic understanding of the legal requirements. Take the plunge and don’t stop.

• Decide on the location you wish to set up your business at.
  • Will you convert your home into office?
    • Will your family and work atmosphere get disturbed given the nature of your business?
    • Will clients or customers be happy visiting you at your home office?
  • Do you need a dedicated office space?
    • Does your business need an office space at all?
    • Will a virtual office space suffice?
    • What will be the area or location?
    • Will your finance plan support your office rentals?
• Recruit smart and talented individuals and professionals. 
  • Balance your team with entrants and experts.
  • Conduct an orientation program. Sell your team on your vision and mission for the business.
  • Delegate tasks based on experience.
• Advertise your business
  • Use classifieds, online services and paid services to advertise about your business.
  • Use social media. Spread the word about your business amongst friends and family.
  • Invest in a good website.
• Receive feedback from customers and employees.
  • Make changes to the business model and plan, as you learn.
• Dedicate time to constantly upgrade yourself with the latest market trends.
  • Equip yourself with the current skills,
  • Stay up to date on the market, competition and customer requirements.
  • Dedicate time to constantly keep learning about the nuances of your own business.

You might have a brilliant idea or the required funding to set up the business but that will not help you become your own boss. For an entrepreneur to succeed it is important for him/her to follow the process step by step. The key to starting up a new business is to prepare a checklist and follow it stage by stage.

Business Startup Checklist

dedicated to helping you start your small business as quickly and easily as possible. In this section, we’ve listed the specific steps required to start your business in any State. Once you’ve formulated your business idea and know where you’ll obtain the money to fund your new startup, the next step is following our instructions for starting your business right the first time!

1. Select a Name and Legal

• Sole Proprietorship
• Partnership

If you haven’t already, prepare at least a preliminary business plan.

3. Obtain your FedtificatioEIN)

If you are setup as a Corporation, LLC or Partnership (or a sole proprietorship with employees), apply for a Federal Employer Identification Number (FEIN) from the IRS. A FE

4. Open the Company Bank Account

Select a bank and open the company bank account.

TIP: Contact the bank prior to opening the account to see what their specific requirements are to open a business checking account; some banks’ requirements are fairly simple whereas some banks’ requirements are extremely complex.

5. Lease Office, Warehouse or Retail Space (if not home-based)

Depending on your type of business (retail, office or warehouse), arrange for office space to be leased. Contacting a commercial realtor in your area can be helpful. Also, make sure to arrange for utilities and office furniture.

6. Obtain Licenses and Permits

A. Federal Permits

Depending on the type of business you are in, you may need a Federal license or permit.

Most businesses do NOT require a Federal license or permit. However, if you are engaged in one of the following activities, you should contact the responsible Federal agency to determine the requirements for doing business:

• Investment advising ( http://www.sec.gov )
• Drug manufacturing ( http://www.fda.gov )
• Preparation of meat products ( http://www.fda.gov )
• Broadcasting ( http://www.fcc.gov )
• Ground transportation ( http://www.dot.gov )
• Selling alcohol, tobacco or firearms ( http://www.atf.gov )

B. State Licenses

Some occupations and professions require a State license or permit. Laws vary from State to State, however, if you are engaged in one of the following professions, you should contact the responsible state agency to determine the requirements for your business:

• building contractors
• banks
• insurance carriers
• physicians
• appraisers
• accountants
• barbers
• real estate agents
• auctioneers
• private investigators
• private security guards
• funeral directors
• bill collectors
• cosmetologists

State Licenses and Permits based on products sold.
Some state licensing requirements are based on the product sold. Contact your state licensing authorities to determine the licensing requirements of your business. For example, most states require special licenses to sell:

• liquor
• lottery tickets
• gasoline
• firearms

TIP: Most people engaged in the types of business that require a special State License or Permit are already aware of the requirements (i.e. an accountant is familiar with the licensing requirements for accountants).

C. Sales Tax Permit

If your company sells physical products within the state where it does business, you may have to collect and pay sales tax. This is usually accomplished by obtaining a State Seller’s Permit or Resale Permit.

TIP: Many service businesses that do not sell a physical, tangible product are NOT required to collect sales tax, ask the State taxation agency for details/clarification.

D. Business License

Most Cities or Counties require you to obtain a business license, even if you operate a home-based business. This is a license granting the company the authority to do business in that city/county.

7. Hire Employees (if applicable)

If you intend to hire yourself or others as a full or part-time employee of your company, then you may have to register with the appropriate State Agencies or obtain Workers Compensation Insurance or Unemployment Insurance (or both).

8. Set up an Accounting and Record-Keeping System

Setup your Accounting and Record-keeping system and learn about the taxes your new company is responsible for paying.

Company documents generally are required to be kept for 3 years, including: a list of all owners and addresses, copies of all formation documents, financial statements, annual reports, amendments or changes to the company. All tax and corporate filings should be kept for at least 3 years.

9. Obtain Business Insurance

There are many types of insurance for businesses but they are usually packaged as “General Business Insurance” or a “Business Owner’s Policy”. This can cover everything from product liability to company vehicles. A decent policy can run as little as $300/year and offers a great extra level of protection.

10. Systemize and Organize

Prepare the business as if someone needed to take it over and run it for you. This means have a method to process orders, pay bills, pay employees, pay taxes, maintain your permits, etc. Basically, try to make the operational aspect of the business as automated and efficient as possible so you can concentrate on growing your business.

TIP: View our “Manage Your Company” section for help with systemizing and automating your business.

11. Develop a Business Identity

Order business cards, letterhead and promotional materials for your business. A professionally created logo can make your business look professional and established.

12. Get the Word Out (Marketing)

Now that you’ve set-up the company for success, you need to get the word out. Create a marketing plan for your products and services that targets your ideal customer.