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Laws about serving cheddar cheese with apple pie, fresh maple syrup in every restaurant, and hardworking people who populate its towns—Vermont lives up to its reputation as a beautiful and unique state.
So it should come as no surprise that people—Vermonters and out-of-state “flatlanders” alike—might want tostart a business在佛蒙特州。是否你想卖的新鲜ods, start a new sustainable clothing line, or market those Bernie mittens, here’s a step-by-step guide to get you started.
Start a Business in Vermont
1. Choose a business idea
First things first: You can’t start a business until you know what the business is going to be. After all, there’s a huge difference between a handmade pierogi business in the town of Barton and a hip barber/tattoo shop in the city of Burlington, right?
Right, but not all business ideas are created equal. Some are fun ideas, but aren’t feasible for making money. In order todevelop a great business idea, ask yourself a few key questions:
- What type of founder are you?Take this opportunity to plan out your idea and determine your founder’s sign with aquick quiz。Figure out what motivates you, whether you are an expert in something, or if you have some key skills you can utilize.
- Who is your customer?Is it a”leaf peeper,” taking in the colorful fall foliage? Parents of a University of Vermont student? Or, a young professional looking for a barber shop to get a haircut and shave? Do some market research into your potential target market to help you understand your customers’ wants and needs. Targeting your business to these pain points is a step toward creating a successful business.
- What is your idea’s profitability?Scope out your business idea’s potential profitability by determining how much you’ll need to sell to cover costs, the likelihood of a returning customer, how much you can expect to make over time from one customer, and how much it’s going to cost to gain each new customer.
- What is your marketing plan?你不需要创建一个完整的销售和市场ting plan yet, but start thinking about sales strategies to help reach your market, from partnering with local influencers to offering freebies and discounts to referrals.
2. Name your business
Naming your business is one of the most important parts of starting a business in Vermont. Why? Yourname represents your business, so you’ll want to choose something memorable, apt, and unique. It will appear on your business cards (test your business name with Shopify's freebusiness card maker), website, and marketing materials. It’s also the name that you’ll use on your business bank accounts and that customers will use when referring to your business.
With so much riding on the perfect name, it’s no wonder that choosing a name for a small business can feel like a daunting task. Here are a few tips to keep in mind when choosing a name.
- Keep it relevant.Your business name should be reflective of what you do and who you are. Avoid names that are too general or vague, and focus on accurately representing the products or services you offer.
- Include the required business identifier.If forming an LLC in Vermont, for instance, your company name must contain the phrase “Limited Liability Company,” or its abbreviation (LLC or L.L.C.).
- Be unique.Before settling on a particular name, be sure to do your homework to check if the businessname is available在佛蒙特州。You can do this through theVermont business name search tool。你不想发现选择一个名称later that someone else has already claimed it as their own.
- Keep it memorable.Don’t be afraid to get creative with your business name to make sure it’s original and memorable to your customers. However, be careful not to make it so clever or pun-filled that it’s too complex to remember or pronounce.
- Confirm the domain name is available.It also makes it easier to find an available domain name for your website, which is an essential part of any modern business.
- Ask for feedback。Once you’ve settled on a few possible names, ask friends, family, and other trusted advisers for their opinions. Getting feedback from others can help you fine-tune your choice and ensure you're making the best possible decision for your business.
Using a DBA in Vermont
Some companies, especially sole proprietorships, choose a name that’s different from their legal name or the legal name of the company. That’s usually called a “doing business as,” or DBA, but in Vermont, it’s also called anassumed business name (ABN)。
You can file for a Vermont ABN online or via mail with theVermont Secretary of State。It takes about a day to get a response online, while mail can take up to 10 business days. It’s one option to consider when you’re figuring out the best name for your new business.
3. Create a business plan
A business plan is a necessary component for every small business owner starting a company. It's like a map that will help you get from Point A (starting your business) to Point B (successfully running your business). But where do you even begin? Start with abusiness plan templateto keep you organized and check out Shopify’sbusiness plan examplesfor inspiration.
Sections ofa solid business planinclude:
- Executive summary.This section should be no more than two pages, and give a brief overview of your business, products or services, target market, financial projections, and overall strategy. Think, an elevator pitch for your business.
- Company description.Break down the details of the business so customers understand why the business exists, what it sells, and its ideal market.
- Market analysis.A market analysis defines your target market, identifies your competition, and determines what sets your business apart from the others. It also analyzes and identifies industry trends that could impact your business.
- Management and organization.This section describes who’s working on your business, and can be tailored to your company’s management structure. It also can include a listing of the type of company formed—whether it’s an LLC, sole proprietorship, S corporation, or limited partnership.
- Products and services. Here, it’s important to list everything the business sells. You can also highlight new product launches.
- Build a buyer persona.Buyer personassound fancy, but really they’re just fictional ideal customers that illustrate who you’ll be selling to.
- Create a marketing plan.How will you reach your target audience? What promotional materials will you use? What pricing strategy will you employ? To get started on amarketing plan, sit down and brainstorm a list of objectives you want to achieve with your marketing efforts.
4. Choose a business structure and get started
Before you can start cashing in, you need to choose the rightbusiness structure。Should you go solo as a sole proprietor? Form a partnership with another entrepreneur? Or set up shop as an LLC or corporation? The answer really depends on a number of factors, including the size and scope of your business, personal finances, and long-term goals.
Sole proprietorships
Asole proprietorshipis an unincorporated business owned by a single individual. So if you own a one-person business, you are automatically considered a sole proprietor.
It doesn’t require any special paperwork to set up. However, this type of business structure does involve certain liability and tax issues—you are personally responsible for all debts and liabilities of the business. So if the business can't pay its bills, creditors can go after personal assets, such as your house or savings account. In addition, you will be responsible for paying taxes on all business income at the personal rate.
Limited liability company (LLC)
AnLLC, or limited liability company, is a formal business structure that offers its owners personal liability protection and personal asset protection for business debts and obligations. LLCs are also often more flexible than other business structures when it comes to taxes and management, and creating one makes it easier to have separate personal and business accounts. Treated as “pass-through” entities, LLCs avoid double taxation—they are only taxed once at the personal level. Still, Vermont LLCs can be taxed as a partnership or an S corporation, both of which require the company to act as a pass-through entity. You’llfile a Business Entity Income Tax return, as well as a Vermont tax return. Vermont also imposes a business entity tax (BET), which has a minimum of $250.
When forming a Vermont LLC, you’ll be required tofile paperworkwith the Vermont Secretary of State and pay a $125 fee. With an LLC, you’re required to maintain records,file an annual reportwith the state, and hold annual meetings. And while Vermont doesn’t require an LLC operating agreement, you might choose to make one to outline how your LLC will function and to protect both you and the company from potential legal and operational issues in the future.
C corporations
A C corporation, orC corp是一种合法的商业实体,是一个单独的勒gal entity distinct from its owners. A key advantage of incorporating in this way is that it limits owner liability. So if a corporation goes bankrupt, the shareholders would only lose their investment, and not personal assets.
However, a C corp has increased paperwork and compliance costs when compared to other business structures, like an LLC. If you want to incorporate in Vermont, you can do so on theVermont Secretary of Statewebsite.
Getting a federal employer identification number (EIN)
The next step is to get a federal employer identification number (EIN), which is basically a Social Security number for your business. It’s essential for business banking and can be helpful in obtaining a business credit card. You canget an EINby applying online with the Internal Revenue Service (IRS).
Incorporating in Vermont
Vermont doesn’t require statewide general business licenses, but you will be required to file Articles of Incorporation with the state. You can do that directly on theVermont Secretary of State’s website, for afee of $125
Components of an Articles of Incorporation include:
- Your business’s name
- A short description of what your business does
- Contact information, including your physical place of business
- Your registered agent’s information, if you’renot the registered agent
- Information about how many stocks you’ll be issuing, if relevant
- Names, addresses, and signatures of all incorporated directors, if relevant
5. Obtain a business license and permits
Vermont doesn’t require a general business license, but some cities have specific requirements. So, depending on your business, you might need specific permits like building or zoning, or a professional license. Check out theVermont Secretary of State’s Office of Professional Regulationfor detailed information about which licenses your business might need.
If you’re starting a business in Burlington or Rutland, you might have to obtain city-specific licenses as well. For Burlington, head to the city’sBusiness Resource Centerfor the information and forms you need. Rutlandoffers a similar serviceon it city website.
6. Examine insurance options in Vermont
Business insurance protects you and your business from unforeseen bad circumstances, like a fire or theft—even a flood. Among the types of insurance you will likely want for your business are:
- Professional liability insurance。If you provide professional services or advice,professional liability insurancehelps protect you and your company from being financially responsible in claims of negligence.
- General liability insurance.General liability insuranceprovides fairly broad coverage, including for injury and property claims, and libel and slander.
- Workers’ compensation insurance。Workers’ compensationinsurance (also called workers’ comp) provides coverage for an injured employee’s medical bills and lost wages after a workplace injury.
- Commercial property insurance。Thistype of insurance(also called hazard insurance or business property insurance) protects against business loss or damaged commercial property.
- Business owners’ policy。Abusiness owners’ policy(BOP) is a package deal tailored to your business’s needs. This type of coverage often includes general liability insurance, commercial property insurance, business income insurance, and workers’ compensation.
7. Understand financial considerations
Once your business is registered, it’s time to start thinking about money matters, particularly, where to get financing for your business. The Vermont district office of theUS Small Business Administrationand theVermont Small Business Development Centerboth offer financial help for companies looking for startup capital, as doesShopify Capital。
Next, there is the consideration: Where to put that money? The best place is a business account, with a business credit card attached. If you already have a bank, you can open new accounts with them so that your personal and business accounts are in the same place. Or, shop around for a bank you feel might be a better fit for your business.;
8. Market your business
After filling the necessary legal paperwork, it's time to start building your brand. This starts with market research, where you identify your customers and assess current offerings to determine what niche you can fill in the marketplace. Then, it’s time to launch amarketing campaign, which could take one of many forms:
- Pay-per-click web ads.Pay-per-click adsare typically more affordable than TV or radio spots. They also use more precise targeting through sponsored search results on websites like Google, during streaming videos, and on social media.
- Social media marketing.To reach younger audiences, companies usesocial media marketing, where they pay social media influencers to showcase their products and services in a video or blog post.
- Organic marketing.Organic marketingincludes search engine optimized (SEO) articles that help your brand show up higher on Google when people do searches for you. It can also include blog posts, videos, or podcasts, which are all geared toward getting you found online through search engines like Google, or on content providers like YouTube or Apple Podcasts.