Small Biz Trends notes that this is because of the increase in young workers arriving in the city, its relatively low cost of living, impressive tax incentives, and venture capital firms investing in Pittsburgh startups.
If you want to be the next small business to make it big in Pittsburgh and give the likes of Duolingo and 4moms a run for their money, here’s how you can get started:
Come up with the right business idea
Before anything else, you should arrive at the right business idea that you love and are willing to work hard for. You can follow in the footsteps of new entrepreneurs who typically start with something they really believe in, so you always have the motivation for growing your venture over time.
It’s also worth pursuing something that people need, ideally something that solves a problem, so you are able to capture a corner of the market from the get-go. For instance, if you’re putting up a small stand in a sunny area, iced drinks, sunglasses, and portable fans are surefire hits as they are essentials that people won’t mind paying for.
Write a business plan
No business will be a success if it is not planned out thoroughly. Before you begin testing your idea or hiring staff, you must first go through a careful planning process, so you have a definitive timeline in place. When you have a plan, you have a clear direction of where you’re going, and you don’t have to go in blind.
What’s more, having a detailed plan can help you secure funding in the future, as it also functions as a tool to convince others to invest in your idea. The good news is writing a business plan isn’t as difficult as you think. At the very least, you should cover market analysis, your proposed service or product line, potential revenue streams, and financial projections.
Select a legal structure
Once you have an idea and a plan, the next step is to select a business structure. Registering your business as a legal business entity, such as sole proprietorship, partnership, or LLC, increases your credibility and protects you from personal liability in case you get sued. For up and coming businesses, registering as an LLC is ideal due to the convenient tax requirements. The process is easy and virtually painless too, as ZenBusiness’ guide to forming an LLC in Pennsylvania notes that all you have to do is select a name, file articles of organization to make it official, appoint a registered agent, and create an operating agreement. The last step is to apply for an EIN so you can open a business bank account, get financing, and hire employees later on.
Register for taxes
Of course, you shouldn’t forget to register for taxes especially if you are selling physical products and hiring staff. Depending on the type of business you have, the Pennsylvania government suggests registering for state and employer accounts, including Sales, Use, and Hotel Occupancy Tax, Employer Withholding Tax, and Unemployment Compensation Tax Account Registrations, with the latter being a non-negotiable if you are planning to have employees or acquiring an existing business with employees. You can register for all of these online, making the process virtually hassle-free.
Open a business bank account
Merging personal and business finances together is a big no-no for entrepreneurs. The U.S. Small Business Administration states that creating a distinct separation between the two is crucial to protecting your own assets and credit. It helps prevent funds, accounts, and assets getting mixed up together which protects the integrity of your venture. Not to mention, it will be so much easier to track business expenses, take advantage of tax deductions, accept payments from clients, and pay employees and vendors. If you have utilities to pay or are applying for credit, it’s also worth setting them under the company’s name, as they’re all expenses of your business.