Women have made leaps and bounds in the world of entrepreneurship, owning some 12.3 million businesses in the US — a figure that is a world away from the 402,000 women-owned companies in 1972. And it’s easy to see why more and more of these women have turned towards ‘mompreneurship’. You can have a more rewarding and empowering career by being your own boss, working anytime you want, and determining how you earn. As opposed to traditional day (or night) jobs, mompreneurs can have more time with kids while saving on daycare and daily commutes.
And what better place to start a small business than here in Michigan, where the workforce is abundant, global supply chain infrastructure is sound, and cost of living is low? With these benefits and the different COVID-19 resources available in the state, starting a small business here wouldn’t be too hard for mompreneur hopefuls like you.
Decide on a Business Name
Deciding on a unique name is the first step to starting a small business as a mompreneur. You can check with the Michigan Department of Licensing and Regulatory Affairs (LARA) to see if yours hasn’t been taken yet. If your desired business name is available, you can reserve it for six months by filing an Application for Reservation of Name with LARA. If you’re planning to start an online business, you should do a trademark check at the USPTO’s Trademark Electronic Search System to make sure your chosen name has not been taken yet either, before proceeding to register it as a domain name.
Choose a Business Entity
Sole proprietorships are one of the most common options for a business entity, and also the simplest, having no separate legal entity from the sole owner. Meanwhile, setting up an LLC in Michigan lets you create a separate legal entity for your business. This draws a clear line
between your personal assets and your business’s, and protects you from liabilities — but without the more complicated procedures of incorporating. That’s because setting up a corporation requires filing articles of incorporation with the state, which then restricts its scope of activity once it operates under state law. In order to choose the right structure for your business, define your company’s goals first and consider the local, state, and federal laws under which it’s going to operate.
Acquire Business Licenses and Permits
If you’re planning to sell products, you should register for a sales tax license with the Michigan Department of Treasury. If your business is going to have employees, you should also register for employer withholding tax, with which you’ll need to obtain a federal Employer Identification Number from the IRS. After that, you should obtain regulatory licenses and permits in the state and local levels that are applicable to your business type and location. These may cover health and safety, the environment, building and construction, and specific industries or services.
Check for Applicable Business Taxes
Other than federal income taxes, there are also taxes for every business type in Michigan. Sole proprietorships pay business income tax as part of their personal state income tax returns. LLCs do the same, along with filing an annual statement with LARA. Corporations, meanwhile, pay Michigan corporation taxes, along with state taxes on the shareholders’ dividends and personal income. Then, there are also separate employer taxes if your business has employees, as mentioned earlier.
Obtain Business Insurance
It’s always a good idea to get business insurance, which is often regulated at the state level. Do some research on which type would be best for your small business. There are at least seven types of business insurance you can use in Michigan or any state. These include professional liability, property, workers’ compensation, home-based business, product liability, vehicle, and business interruption. By getting the right insurance, your small business can avoid major financial losses due to lawsuits or catastrophic events. While you’re at it, you may also want to sign up for community events like the Mom to Mom Sales in Oakland County. Here, you can start building your business fund conveniently by
selling old clothes and toys your kids have outgrown. And who knows? Soon, it may even be a good venue to launch your new business and build more growth opportunities.
PHOTO CREDIT – Photo by Ketut Subiyanto from Pexels
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