How to Start a New Business in Alabama
- 1). Develop a business plan. Prior to finding a business location or undergoing any other business-related task create a detailed business model/structure. This plan should consist of what products/services you offer, your target demographic, advertising plans as well as how your business will operate.
- 2). Attend free training classes and seminars from the Alabama Small Business Development Center (ASBDC) offers state-wide assistance to small businesses. Along with helping to design your business structure the ASBDC can also assist in securing grants and small business loans.
- 3). Find a location for your business. Research the different neighborhoods within your city. Establish your place of business where the highest concentrations of possible customers are located. An example would be if you were starting a bookstore, purchasing retail space close to high school and college campuses may improve the profitability of your store due to the surrounding demographic.
- 4). Secure financing for your business. If you do not have ample amounts of cash you can apply for small business loans and grants. Speak with a financial advisor to learn about the different type of business loans available. If you do not have a financial advisor you can speak with an ASBDC representative about funding options.
- 5). Create an official business name. After you have selected a name reserve this name with the Alabama Secretary of State by calling the Corporations Call Center at 334-242-5324 or mailing in the Name Reservation Request to:
Alabama Secretary of State
Attn: Corporations Division
100 N. Union St., Suite 770
Montgomery, AL 36130
Take note that as of 2010, the Name Reservation Request application requires a $10.00 fee. - 6). Register your business with the Alabama Secretary of State if you are operating a corporation, limited liability company, partnership or a non-profit company. If your company is a sole proprietorship you are not required to register.
Fill out the Domestic For-Profit Corporation Articles of Incorporation. Only file this form after you have received the Name Reservation Certificate from the Secretary of State. You must also include the State of Alabama Application for Certificate of Existence, which as of 2010 requires a $5.00 fee (as of 2010). Lastly, include the $40.00 fee (as of 2010) for the Domestic For-Profit Corporation Articles of Incorporation and mail this registration packet to your cities Secretary of State office. - 7). Apply for an Employer Identification Number (EIN) by filling out Form SS-4. You may apply for an EIN online through the IRS website, by mailing a hardcopy of Form SS-4 or by calling 800-829-4933. You must also register your business for state taxes. This can be done online by the Alabama Business Tax Online Registration System provided by the Alabama Department of Revenue.
- 8). Apply for any required business licenses or permits. The Alabama Department of Revenue features a business licensure database outlining all business required to be licensed as well as how to obtain a required license. Take note that you must pay application/licensure fees.
- 9). Hire employees and begin organizing your business for its opening day after you have completed all the aforementioned steps.
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