Tips for starting up a business in New York

Knowing what to consider before starting a business and learning the different types of business structures can set potential entrepreneurs up for success.

New York is one of the best places in the country to make successful business ventures, especially for those who live in the big city. This great potential for making money, however, also leads to the State being one of the more competitive places in the business and financial realm. It can be tough for someone who is looking to start up his or her own company. Thankfully, a lot of experts have weighed in on some of the strategies they know from experience will most often lead to a new business's success. Becoming privy to some of these strategies as well as getting an idea of the pros and cons of different ways of structuring a business can give aspiring entrepreneurs a leg up over less informed competitors.

Questions to ask when deciding how to structure a business

The planning phase for starting up a successful business involves assessing the needs and functions of the business itself, in order to determine the most effective structure. The following list from the City of New York is meant to give people an idea of the types of things they should be considering:

· Will cash from the business need to be accessed for personal use?

· How much profit or loss is expected in the first year? How much is expected in successive years?

· Will the business be more or less vulnerable to liabilities and lawsuits?

· How important will outside investors be to keeping the business running smoothly?

· How many people will own the business? Will it e just one person, or will there be one or more co-owners?

Every potential business owner should also have a vision regarding what type of business it will be, and how big it is expected to become.

Understanding the different business structures

After assessing the above questions, a potential business owner will next need to know what the differences are between different business structures that exist beyond a basic business corporation. A sole proprietorship gives the owner complete control, but also full liability, whereas in limited and general partnerships, liability is split, but so is decision-making power. Those who are interested in pursuing an option where they are less liable may want to look at forming a Limited Liability Company, where it becomes possible for the corporation itself to be viewed as separate from the owners. Those who want to have limited personal profitability in exchange for a tax exempt status may be interested in forming a non-profit.

Someone who is looking at starting up a business in New York may find it helpful to consult an attorney in the local area who practices business organizations law.