With a GDP of over an astonishing $3.1 trillion, California is not just the biggest and the fastest-growing economy in the United States, but it’s the World’s 5th economy, just behind Germany and ahead of India.
California offers limitless possibilities for everyone willing to live the American Dream. They’re especially dominant in the entertainment business, thus it’s not surprising that almost every entrepreneur in the music business wants to start his own music business LLC in California.
If you’re one of them, here are some tips and 10 key steps you need to follow before you decide to move your business to Los Angeles, San Francisco, or San Diego.
Do the research and collect all necessary information
Good preparation is half the job. So, whether you’re starting your business from scratch, or moving your business from another US State or a different part of the World, you need to conduct a proper investigation and collect all the information needed to run a business in San Diego, California.
The math is simple: TO RUN A SUCCESSFUL BUSINESS, YOU NEED TO BE FULLY AWARE OF YOUR BUSINESS ENVIRONMENT. By knowing your environment, there are two key factors you need to be aware of:
- Laws and regulations
You don’t have to be a lawyer or a law expert, but simply you need to know the law and regulations related to your business. You need to know how to register LLC, which documents you need to provide, how much it will cost you, etc.
Before you jump into business, you need to do proper research and as much as possible details about your competition. In a modern-day business environment, the race for profits is ruthless like never before, so you need to know who you’re competing with.
Make a business plan
If you don’t have a business plan, don’t even think about starting a business. I’m not talking about ideas in your head, but a proper plan, with:
- Detailed analysis of your business,
- SWOT analysis,
- At least 3-year operating plan with Balance Sheet, P’n’L, and Cash Flow.
If you don’t know how to perform all the stated above, hire a professional. Many financial consulting companies will willingly perform this sort of due diligence for you.
Pick a business name
Picking a powerful and suitable name for a business can predestine the company’s future. Before you choose one that you’re satisfied with it’s necessary to make sure there is no company with that name. To check that you can use a business search on the California Secretary of State website. After you confirm there is no company with the identical name you can register it at the County of San Diego, Assessor/Recorder/County Clerk’s Office.
Regulate the legal structure of the business
The legal structure of your business is predetermined by 3 factors:
- Initial Equity
- Number of Employees
- Annual Revenue
Based on that, you can register your company as Sole Proprietorship, Limited Liability Partnership, General Partnership, Limited Partnership, Limited Liability Company, or Corporation.
Limited Liability Company or LLC is the most common form of business entity in California, so if you decide to move your company to San Diego, read the laws and regulations related to LLC carefully.
Regulate business activity type
The city of San Diego has a general business types classification, so when applying for business registration, you need to choose one of them. Each of the types is determined by start-up requirements and where the business can be operated. This is not a matter of choice, but it’s mandatory for business registration.
Select a site for your business
When you’re choosing a site for your business, first you need to check with City officials if your type of business is legal in certain areas. This is a must before you start your own business, but it’s easier than it sounds. Just contact City officials and they’ll probably respond within a day. After you get a written confirmation from them, you may proceed with business registration.
Collect special licenses and permits (if needed)
Depending on the type of business activity you chose you may need some permits to run your business legally. More information on licenses and permits you can find on CalGold. You may need more details for a specific type of business like a description of the requirement, the name, address, and telephone number of the agency.
Make sure you have all tax-related information
I suppose there is no need to stress how important it is to know everything tax-related for your business. You’re going to be obliged to pay income tax, unsecured personal property
tax, employment tax, and the City’s Business Tax. Many people even hire a tax preparer to help them at the start.
Learn about employer responsibilities
As a new employer you have a new set of responsibilities:
- Register as an employer and get EIN (Employer Identification Number)
- Pay additional taxes
- Match and submit employee withholdings
- Collect employee’s compensation insurance
- Adhere to employee eligibility regulations
Apply for the Business Tax Certificate
Every person or a business entity operating a business for more than 6 days in one calendar year in San Diego must have a business tax certificate. You may apply for a Certificate locally or download it from the City’s website.
All those steps may seem like a lot of work to do and time-consuming. To be frank, it can be stressful and hard if you’re not prepared properly. Luckily, those key steps for starting a company in San Diego are explained in detail, and just by following this simple guide, you can realize your business idea into a money-making machine.