SCORE Legal Questions

SCORE Legal Questions Why Is A Business Plan Necessary?

A well-written business plan is a requirement of any lending institution that you may contact for a loan. Even if you don't need a loan, you should prepare a good business plan. This will require you to put a great deal of thought as to the risks and benefits of proceeding. It will generate a lot of questions that you may not consider without this effort. A business plan is the foundation of good business.

How Should I Structure My New Business?

Probably most new businesses should organize as sole proprietorships because of its simplicity and low initial cost. Review your business plan with a SCORE business counselor to discuss various business structures and determine what suits your business. If more than one individual will own the business, a business attorney and accountant should be consulted from the very beginning stages of business planning, so necessary legal documents are prepared and filed for your partnership or corporation.

How Do I Find An Attorney Or An Accountant?

The referral services of county and state bar associations can help you locate an attorney. Also contact business colleagues who have worked with attorneys and accountants. Obtain recommendations and interview your short list of candidates. Treat this with great care so you make the most informed decision about getting a skilled professional that is suited to your business needs. Meet for a consultation interview to find out what services are provided and how you will be billed. Usually, this initial consultation is provided at no charge to you.

What Tax Number and Licenses Are Required To Operate My Business?

Most SCORE offices have a list of the names and addresses of the various city, county, state, and federal offices you will need to contact for licenses, registration, and fees. Most counties, cities, and towns require registration of your business with the clerk of that governing body. Depending on your business, certain state permits may also be required. To obtain a state sales tax number, you will need to contact the nearest state sales tax bureau. They will provide specific instructions and all the forms required to apply for the number.

Is It Better To Buy Or Lease A Building For My New Business?

Probably nine out of ten times SCORE advises clients to lease space instead of buying or building. This is simply because most new businesses do not have the capital to buy or build offices at the beginning of the business venture. Furthermore, it is often better to lease in order to free up cash for business operations and avoid assuming a large loan of this type at the opening of business operations.

I'm Having Difficulty Making Cash Flow Projections. Is There An Easy Way?

Unfortunately, there is no easy way to prepare a cash flow statement. You simply have to invest the time and effort necessary to research all the numbers before applying them to your statement. Think of the cash flow statement as your projected checkbook. That is, on your cash flow statement as "cash in," enter your estimated deposits that you expect to post to your checkbook register. On this statement as "cash out," enter checks you expect to write and post to your checkbook register. Having a computer program available to calculate all of the numbers will help save time and add efficiency, but you must invest the time up front by projecting realistic income and expense numbers.

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