A good idea is the first step of starting a business in Florida, but if you don’t know what type of business you should start, I have three things to consider.

First, it’s important to conduct thorough market research in your local area and identify gaps in the market, emerging trends, and areas of potential growth. This research can help you uncover business opportunities that have a higher likelihood of success.

Secondly, you should also consider whether your proposed business is something that people need or want in your area. Before committing to a particular business, test your idea through methods such as customer interviews, surveys, or creating a minimum viable product (MVP). This process can help you gauge the potential demand and refine your offering.

Last, seek professional advice and consult with a business advisor, mentor, or consultant to discuss your ideas and seek guidance. They can help you refine your business idea, evaluate its viability, and provide insights on market trends and opportunities.

Maybe you already have an idea picked out, or maybe you are still deciding on one. Regardless, you can check out our library of business ideas to get detailed industry information, trends, costs to start, tips, and lots more.

A business plan serves as a crucial foundation for your business, providing you with not only a tool to obtain the necessary funding to get your business off the ground but its also a roadmap to guide your direction and enhance decision-making,

Related: How to write a business plan

A business entity is any structure used to conduct and conduct business operations. The four main basic types of entities that can be created in Florida include the sole proprietorship, partnership, corporation, and Limited Liability Company (LLC).

A Sole Proprietorship is an individual-run business in which the owner is responsible for all actions and financial liabilities of the business. This type of business structure makes it easier and less expensive to start versus the other entities, as there is little to no paperwork required by the state.

One common registration for the sole proprietorship and partnership that any business operating under a Fictitious Name (sometimes referred to as an assumed name, trade name, or Doing Business As/DBA) in Florida will need to register the business name by filing a Fictitious Name Registration (DBA).

Related: How to start a sole proprietorship in Florida

A General Partnership is a business structure that allows two or more persons to operate an unincorporated business and share in the profits. While easy to start, it also comes with inherent risks, as each partner’s personal assets are potentially at risk when engaging in business. This means that if the business were to incur any debts or be involved in legal proceedings, the partners would be held liable for it, and all of their personal possessions, such as homes, cars, and bank accounts, could be at risk.

Related: What is a partnership?

A Corporation is a separate legal entity that is owned by shareholders. It offers the benefits of limited liability, which means that shareholders are generally only responsible for the amount they have invested in the company, even if things don’t go as planned.

Related: How to form a Florida Corporation

An LLC, or Limited Liability Company, is a popular business structure that combines the benefits of a corporation with the ease of operation as a partnership or sole proprietorship. The reason for its popularity is that the LLC offers flexibility in management and taxation while providing limited liability protection to its owners (known as members).

Related: How to form a Florida LLC

Certain licenses and permits will be needed to operate a business in Florida, and the ones needed will vary on the business’s activities and location. Some common registrations include:

Business Licenses: There is no general state of Florida business license; however, many cities require a business license to operate.

Employer Identification Number: An EIN is a nine-digit identifying code assigned by the Internal Revenue Service (IRS) to businesses. This number is used for tax identification as well as other business dealings with the IRS, such as filing a return, applying for a business bank account, and more.

Sales Tax Permit: Businesses selling products and certain services will need to register for a Sales Tax Permit with the Florida Department of Revenue.

Professional Licensing: Some services, such as physical therapists, interior designers, detectives, cosmetologists, barbers, architects, and massage therapists, require licensing in Florida. While this isn’t a license on the business, licensing is required to operate. There are two main licensing agencies for “skilled trades”: The Department of Business and Professional Regulation (DBPR) and The Department of Agriculture and Consumer Services (DACS).

Related: What business licenses and permits are needed in Florida

Opening a business bank account is a great way to organize and track your business. Separating your personal and business funds makes it easier to track income and expenses, which not only helps with record keeping and tax time, but gives more protection in the event of an audit.

Starting a business can get expensive and a common obstacle is finding funding. The best way to get started is to know your financials. Some tips for finding the money to get started include:

Develop a solid business plan: A comprehensive and well-prepared business plan is crucial for securing funding. Your plan should include a detailed market analysis, a clear description of your product or service, financial projections, and a compelling executive summary. The plan should also include the requested amount, repayment plans, and how the funds will be used. Be transparent and provide a clear rationale for the requested funding.

Understand your funding options: Familiarize yourself with the different types of funding available, such as business loans, Small Business Administration (SBA) guarantees, lines of credit, grants, angel investors, or venture capital. Research the requirements and qualifications for each option to determine which is the best fit for your business needs.

Build and maintain good credit: A strong personal and business credit history can significantly improve your chances of securing funding. Make timely payments, manage your debt responsibly, and monitor your credit reports regularly.

Determine collateral: Many lenders require collateral to secure funding. Assess your assets and be prepared to offer collateral, such as real estate, equipment, or inventory, if needed.

Be prepared to invest your own capital: Lenders often expect business owners to have some “skin in the game” by investing their own money into the venture. Demonstrating personal commitment to your business can make your loan application more attractive.

Be patient and persistent: Securing funding can be a time-consuming and challenging process. Be patient, prepare for setbacks, and persistently pursue multiple funding sources.

Related: Understanding the different types of business funding.

Hiring your first employee in Florida can be both an exciting milestone and a necessary, but complex process for small business owners. Preparing for this step involves several key considerations, such as understanding federal and state labor laws, developing comprehensive job descriptions, establishing fair compensation and benefits packages, and implementing efficient onboarding processes.

Related: Steps to hiring your first employee in Florida

Having the right insurance coverage to protect your business is an essential part of starting a business. Depending on the type of business you are creating and the risks associated with it, there are many types of insurance that should be considered, such as property insurance to protect against damages or theft, and liability insurance to cover any potential lawsuits and injury claims made against your company.

Workers’ compensation insurance is required for any business in Florida with six or more regular employees or twelve or more seasonal workers in certain circumstances.

As this is a complex area requiring careful consideration of all risk factors involved in operating your business, it is best to seek professional advice who can help identify what type and level of cover best fits the specific needs of your small business.

Related: Types of insurance your business may need

A well-organized bookkeeping system provides numerous benefits to business owners, with effective recordkeeping and tax compliance being at the top of the list.

Accurate recordkeeping is crucial for monitoring the financial health of your business. A good bookkeeping system enables you to track revenues, expenses, and cash flow, allowing you to make informed decisions about your operations, investments, and growth strategies. It also helps you identify potential issues or inefficiencies that may require attention, ensuring your business remains financially stable and sustainable.

Secondly, a well-maintained bookkeeping system simplifies the process of filing state and federal taxes by providing organized records of all taxable transactions, deductions, and credits. This organization allows you to accurately report your income and expenses, minimizing the risk of errors or discrepancies that could lead to tax penalties, interest charges, or audits.

By maintaining organized financial records, business owners can make informed decisions, minimize tax-related risks, and create a strong foundation for their company’s success.

Related: Setting up accounting for a business