Everything written so far is true, but don’t let it discourage you. As long as you have an accountant & you never over spend yourself you should do okay. If you run a very small business it’s not that big of a deal as long as you never bother your neighbors with noise, parking or traffic.
You can sell things wholesale at swap meets, & this way you won’t have the over head of an actual place of business. If local laws allow, you could set up a business in your garage, but I would never let people into my house these days, especially if you have a family. You just never know. The person who wrote about not buying things that need special sizes (like shoes & clothes) was right on. Another point is not to get involved in things that go bad in time or storage (like make-up, perfume or canned food goods etc) soap & bath products might be okay, as long as you are careful to store them in a cool place with little light, but be very wary of these things & be sure to do your research.
If you are selling to the public, think about buying insurance in case anyone gets hurt (like slipping on ice or falling down on your property) A few years back at a local art & produce fair an elderly lady was struck by the wind hitting an “EZ-up” tent booth. It knocked her down & she was hurt. Someone had to pay her medical bills! That’s why you may need business insurance. (One more item of note: many people refuse to sell baby clothes & toys in case a child may choke or get hurt… some insurance companies refuse to offer insurance to those make & sell baby items)
But first things first: You’ll need to get a wholesale/tax number. (available from your state) Then you might also need a business license from your local town or city. As far as zoning goes, it only matters if you are actually selling out of your house, because parking & traffic are issues. And YES you will definitely need a separate banking account for your business. If you buy wholesale, someone has to pay the tax on the items you buy. Either you or your customer (usually not the wholesalers) Before any wholesalers will do business with you, they will send you a form to fill out asking for your wholesale number etc. If you have a tax number you can order without paying taxes opn the wholesale items, but Someone always has to pay sales tax: In my state if you resale things, make, or remake things from wholesale items you purchaced without paying sales tax, you have your customers pay the sales tax, then send that tax money into the state. Depending on your business, you can sometimes just pay tax on your wholesale purchases when you buy them. That way you have already paid the tax & this can save steps, but this is rarely done. As previously stated, you will need to comply with Federal, State & Local Tax & business laws.
Your accountant will let you know the ins & outs of what things you can declare for tax purposes. Things like your separate computer & printer for your businesses records, If you have a single room for your business sometimes you can declare say for example an eighth of your house payment etc. (Ask your accountant!) The tax people expect you to loose money for the first few years. You can deduct your business start up costs & sometimes gasoline & mailing costs as well as many other things. Now, you have an idea why you HAVE to have an accountant. (it’s WELL worth their cost) Save EVERY single business receipt & give these to your accountant. You may be audited seven years or so later & you want every “I” doted & every “T” crossed! Ask your accounted about “red flags” when you file your federal, state (& sometimes city) taxes & especially have receipts for these things! In my state, if you get a tax number & don’t make any money from your business after 3 years, they call it a “hobby” & not an actual business. Then your tax number is usually revoked.
Here’s a few ideas: You can buy (in bulk) things to start a “Dollar Store” You can buy from “Overstock & Liquidators” you could buy from “Importers” (but I wouldn’t recommend importing yourself unless you know something about it) A good way to begin is to either buy a book about opening a business in your state or taking a class or two at your local community college or a class online. The Small Business Administration (SBA) has a library online with all kinds of forms: www.sba.gov & a volunteer from the SMA will meet you (usually at your local library) & answer questions about starting a business.
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