When starting a business in Nebraska, it’s important to choose an idea that is viable and profitable. To evaluate the feasibility of a business, there are several factors to consider, such as market demand, competition, geographical location, workforce availability, and potential customers.

Market Research: Market research helps entrepreneurs assess the viability and potential profitability of their business idea by providing insight into consumer trends, target markets, and industry regulations. Be sure to check out our library of business ideas to get detailed industry information, trends, costs to start, tips, and lots more.

Market Demand: Before starting any business in Nebraska, you should research the market to determine if there is enough demand for your product or service. Consider the population size and demographics of the area you plan to serve. Are people likely to buy what you’re selling? Will they come back for more?

Competition: It’s also important to assess the competition in your market. How many other businesses offer similar products or services? What will you do better? Knowing your competitors can help you develop strategies for differentiating yourself from them and gaining an edge in the marketplace.

Geographical Location: The geographical location of your business can play an important role in its success. Is it located in an area with easy access for customers? Are there transportation options nearby? Does it have good visibility from passing traffic? These are all things to consider when evaluating potential locations.

Workforce Availability: If you plan on hiring employees for your business, it’s important to consider the availability of qualified workers in Nebraska. Research local job markets and find out what skills are most in-demand so you can ensure that you’ll be able to find qualified candidates when needed.

When starting a business, an essential step is to write a comprehensive business plan. A business plan serves as your roadmap and outlines the steps for getting from where you are now to where you want to be.

A good business plan should include key elements such as market research, cash flow projections, and financial statements. It should also clearly define your company’s objectives, identify problems that need to be addressed and describe how solutions can be implemented. Additionally, it should provide a clear timeline of when certain goals should be achieved, and milestones met.

Related: How to write a business plan

A business entity is a legal structure that defines how a business operates and is taxed. Choosing the right business entity is important as it can have an impact on taxes, personal liability, and the administration of the business. In Nebraska, there are four common types of business entities: sole proprietorship, general partnership, corporation, and Limited Liability Company (LLC). I’ll go over each type of entity, and their pros and cons.

Sole Proprietorship: This is the simplest form of business entity, where the owner and the business are considered the same legal entity. The owner is personally responsible for all debts and liabilities.

Pros:
– Easy and inexpensive to set up.
– Complete control over business decisions.
– Minimal regulatory requirements.
Cons:
– Unlimited personal liability for business debts and obligations.
– Limited business continuity, as it ceases to exist upon the owner’s death or incapacitation.

General Partnership: A general partnership consists of two or more individuals who agree to share ownership, profits, and responsibilities of a business. Each partner is personally responsible for the partnership’s debts and liabilities.

Pros:
– Easy to establish and low setup costs.
– Shared decision-making and financial responsibilities.
– Business income is reported on each partner’s personal tax return.

Cons:
– Unlimited personal liability for each partner.
– Potential conflicts between partners (a partnership agreement is highly recommended).
– Limited business continuity, as it may dissolve upon the departure or death of a partner.

Corporation: A corporation is a separate legal entity owned by shareholders, providing them with limited liability protection. It is more complex and costly to set up and maintain than other business structures.

Pros:
– Limited liability for shareholders.
– Easier to raise capital through the sale of stock.
– Enhanced credibility and potential for business growth.
– Business continuity, as it exists independent of its owners.

Cons:
– Expensive and complex to establish and maintain.
– More extensive regulatory and reporting requirements.

Related: How to form a Nebraska corporation

Limited Liability Company (LLC): An LLC is a hybrid business structure that combines the limited liability protection of a corporation with the fewer administrative requirements than the corporation.

Pros:
– Limited liability for members (owners).
– Pass-through taxation, avoiding double taxation.
– Flexibility in management and profit distribution.
– Fewer formalities and reporting requirements compared to a corporation.

Cons:
– More complex and costly to set up than a sole proprietorship or general partnership.
– Potentially higher state fees or taxes, depending on local regulations.

Related: How to form an LLC in Nebraska

If you’re looking to start a business in Nebraska, it’s important to understand the various licenses and permits that are necessary for your business to operate legally. In Nebraska, businesses may need to obtain licenses and permits depending on the location, the type of business, and federal and state regulations.

Business Licenses: Even though the state doesn’t require a business license, in general, many cities in Nebraska will require businesses to apply for a local business license before they can open and legally operate. Depending on the type of business you plan to operate, you may also need additional licenses or permits from other government agencies. For example, if you plan to sell food or alcohol, you’ll need additional licensing from the state’s health department or liquor control board.

Name Registration: A sole proprietorship or general partnership will need to file a Trade Name Registration, also known as a DBA or Doing Business, As with the Secretary of State if operating under a business name, rather than the owner’s name(s).

Employer Identification Number: The Employer Identification Number or EIN (sometimes referred to as the Federal Employer Identification Number or FEIN) is a nine-digit tax identification number issued by the Internal Revenue Service (IRS). This number identifies a business operating in the U.S and is used for paying payroll taxes, filing tax returns, and more. Much like what a social security number is to a person, the EIN is similar to a social security number for a business. While most businesses will need to get an EIN, some do not.

Nebraska Tax Application: Business registration with the Nebraska Department of Revenue for a Tax ID Number is required for all businesses. This is most commonly used to register for a Sales Tax Permit, which is for businesses making retail sales of products and providing certain services.

Professional Licensing: Some occupations, such as acupuncturists, barbers, contractors, and others, require licensing in Nebraska.  While this isn’t a license on the business, licensing is required in order to operate.

Zoning – Before starting to operate a business (even if it’s home-based), be sure to check local zoning regulations to ensure the business can legally operate at the location.

Related: What business licenses and permits are needed in Nebraska

Separating business and personal funds in Nebraska is an important step for a number of reasons.

First, it helps to ensure that you are able to track the income and expenses associated with your business accurately. Having separate accounts for each makes it easier to identify any discrepancies or potential problems.

Second, keeping your business and personal funds separate can help protect your personal assets from any potential liabilities associated with your business. If you have all your funds in one account and something goes wrong with your business, creditors may be able to access those funds as part of the collection process. By keeping them separate, you can limit the amount of risk involved if something unexpected happens.

Finally, having a separate business checking account can also make filing taxes easier at the end of the year. You will be able to clearly identify which expenses were related to the business and which were personal expenses. This will save time when preparing tax returns and ensure everything is reported correctly.

Securing adequate financing is crucial for the successful launch and growth of your business. However, it is important to understand the different funding options available to ensure that you have the capital you need to get your business off the ground.

Here are some common funding options to consider:

Personal Funds: Also known as “bootstrapping,” using personal funds is one of the most common ways to finance a new business. This can include savings, retirement accounts, or funds from the sale of personal assets.

Pros:
– Complete control over your business.
– No debt or obligation to investors.
– Demonstrates commitment to potential investors or lenders.

Cons:
– Limited funding capacity.
– Personal financial risk.

Conventional Bank Loans: Traditional banks and credit unions offer a variety of loan options for small businesses, including term loans, lines of credit, and commercial mortgages.

Pros:
– Competitive interest rates (for borrowers with good credit).
– Structured repayment terms.
– Retain full ownership of your business.

Cons:
– Will typically require collateral and personal investment.
– Stringent credit and financial requirements.
– Lengthy application and approval process.

SBA Loan Guarantees: The Small Business Administration (SBA) provides loan guarantees to lenders, making it easier for small businesses to obtain financing. These guarantees reduce the risk for lenders and can result in more favorable terms and conditions for borrowers.

Pros:
– Access to larger loan amounts.
– Competitive interest rates and repayment terms.
– Typically reduces collateral and personal investment amounts.

Cons:
– Lengthy application and approval process.
– Strict eligibility criteria.
– Still requires personal guarantees and collateral in some cases.

Microloan Programs: Microloans are smaller loans typically offered by non-profit organizations or specialized lenders, designed to support small businesses that may not qualify for conventional loans. A few organizations include Invest Nebraska, Midlands Latino Community Development Corporation, and the Nebraska Enterprise Fund.

Pros:
– Access to funds for businesses with limited credit history.
– Typically lower interest rates than credit cards or alternative lenders.
– Business training and support are often provided by the lender.

Cons:
– Smaller loan amounts, usually capped at around $50,000.
– Shorter repayment terms.
– May require personal guarantees or collateral.

Investors: There are several types of investors, including angel investors, venture capitalists, and equity crowdfunding platforms. These investors provide capital in exchange for ownership stakes or debt in your business.

Pros:
– Access to large amounts of capital.
– Valuable business advice and mentorship from experienced investors.
– No repayment obligation for equity investments.

Cons:
– Dilution of ownership and control.
– Pressure to generate returns for investors.
– Complex legal and regulatory requirements.

Related: Understanding the different types of business funding

Preparing to hire your first employee in Nebraska involves several important considerations. There are several federal and state laws and regulations to be aware of, such as minimum wage, overtime, anti-discrimination, workplace safety regulations, and more.

In addition, employers are responsible for reporting new hires, verifying employees are eligible to work in the U.S., income tax withholding, unemployment insurance, unemployment taxes, and payroll withholding taxes, including Social Security and Medicare.

Related: Steps to hiring your first employee in Nebraska

As a small business owner in Nebraska, it is important to understand the importance of insurance and the types of policies available to protect your business. Insurance can help protect your business from financial losses due to unexpected events such as natural disasters, lawsuits, and employee injuries. Having the right type of insurance coverage can provide peace of mind knowing that you are prepared for any potential risks that may arise.

When choosing insurance policies, it’s important to consider the unique risks and requirements of your specific industry and business. Here are a few common types of insurance policies.

– General liability insurance is recommended for all businesses and protects against claims of third-party bodily injury and property damage, reputational harm, and advertising injury.
– Workers’ compensation insurance is required for all employers in Nebraska. This insurance protects employers if an employee is injured while performing their job duties.
– Commercial auto insurance is necessary if you use vehicles for business purposes, and often personal policies won’t cover a claim if the vehicle is being used for business.
– Professional liability insurance (also known as errors and omissions insurance) can help protect your business from claims related to negligence or failure to perform services as promised.

Related: Types of insurance your business may need

Bookkeeping is an essential part of running a small business. It involves tracking and recording all financial transactions, such as income and expenses, to ensure accurate reporting of the company’s financial position. By keeping accurate records, businesses can make informed decisions about their operations and plan for the future.

When it comes to bookkeeping for a small business, there are several types of records that need to be kept. This includes sales receipts, accounts payable and receivable, payroll information, bank statements, invoices, tax documents, inventory records, and more. All of this information should be organized in a way that makes it easy to find when needed.

There are several ways to efficiently organize and record all of this information. One option is to use accounting software such as QuickBooks, Xero, and others which can help automate the bookkeeping process by tracking income and expenses in real-time. Additionally, businesses can establish a paper filing system for physical documents or outsource the bookkeeping process to an experienced accountant or bookkeeper who can provide timely financial reports on the company’s performance.

Related: Setting up accounting for a business