Starting a business may seem like a complicated process, but in reality, it is pretty easy when you break it down into manageable steps. If you have never started a business in Hawaii before, you may wonder how even to begin. This article will provide you with all the steps, from choosing an idea to marketing your business. With this guide, you’ll be able to start your Hawaiian business in no time!
Step 1: Choose Your Idea
The very first step in starting any business is choosing your idea. Your chosen idea will be the building blocks of the business, so it doesn’t need to be overly complicated or structured at this stage.
Choosing a business idea can be pretty simple once you ask yourself the following questions:
- What are my hobbies and passions?
- Can these hobbies be turned into a profitable business?
- Can I see myself running the business and enjoying it?
- What current needs are there in the market?
- Is there a need for your business?
- Are there any other businesses similar to mine?
These questions should help point you in the right direction. If your idea does not seem like it will work, do not worry, as you can tweak it as you answer the questions until it works. You can also enlist the help of your friends and family to see if your idea is a good one and to build on it.
Step 2: Pick a Name
Your business name is so important when it comes to attracting potential customers. Your name is the first thing that many people will see and hear. Their first impressions of your business will be based on your name. Therefore, you want to choose a unique and memorable name that is easy to read and pronounce. You should also ensure that your name is relevant to your business and the industry.
On top of all that, you need to adhere to state regulations. In Hawaii, you cannot use a name that has already been registered with the Secretary of State. You can check if your desired name is still available on Hawaii’s Business Express website.
If you are still battling to come up with a name, try the following suggestions:
- Create a word dump. This is simply a list of words you jot down as soon as they pop into your head. You don’t have to think too hard about the words; this is a creative process.
- Hold a brainstorming session with friends and family.
- Create a survey on social media, asking people what names they think are best.
- Use an online name generator.
Step 3: Write Your Business Plan
After you have decided on a business idea and name, it is time to write your business plan. A business plan is like the instruction manual to start your business. It will include all your research, planning, and financial goals.
While there are no set rules on what needs to be included, a good business plan should include the following:
- All the basic information about your business
- The purpose of your business
- What gap in the market your business fills
- Your direct competitors
- Your plan to stand out from them
- Your target audience
- Your plan to turn them into paying customers
- The cost to start your business
- Roles to be filled by employees
- Your financial predictions and calculations
Your business plan can also be used as a tool to attract potential investors to your business.
Step 4: Get Funding
Starting a business will require capital; unless you can fund this money yourself, you will need to get funding elsewhere. Three ways to get financing for the business are a grant, loan, or investor.
Grants
A grant is one of the best ways to acquire funding for your business, as you do not have to pay this back. The Hawaii Business Development and Support Division offers several grant programs for businesses. You can check these out here.
Loans
While grants are advantageous, they do come with a strict set of requirements you need to meet to qualify. You can apply for a loan if your business does not meet the grant requirements.
The Hawaii Business Development and Support Division has more information about loans available through the state. Additionally, you can seek loans from private sources such as banks or even friends and family. Make sure you read the fine print before signing any contract.
Investors
Having someone else invest in your business is an excellent way of getting funds, especially if you’re interested in having shareholders. In Hawaii, there is a local network of investors called Angel Investors that the local government endorses. You can also ask your friends, family, and acquaintances to see if anybody would be interested in investing in your business idea.
Step 5: Choose a Business Structure
While there are at least four different business structures to choose from, picking the right one for your business is so crucial to the success of your business.
Sole Proprietorship
As one of the most straightforward non-formal business structures, a sole proprietorship is a single-owner business. There is no separation between the business and the owner. Because of the simplicity of this business structure, it is commonly chosen for the low-risk business.
Partnership
A partnership is another informal business structure similar to a sole proprietorship in that there is no separation between the owner and the business. The only difference is that a partnership has more than one owner, each with equal shares in the business.
Limited Liability Company
A limited liability company, LLC, is a formal business structure and is one of the most commonly used structures for small businesses. What makes this business structure so great is that it has the simplicity and ease of a sole proprietorship or partnership with the added liability protection of a corporation. An LLC has the best of both worlds.
C or S Corporation
As the most formal business structure available, many large companies with many shareholders choose to use this business structure. This business structure separates the business from the owners and is an entirely separate legal entity from the owners.
Many large corporations choose to be taxed as an S-type corporation by the IRS due to their special tax status.
Step 6: Register the Business
To officially form your business with Hawaii, you will need to register your business. Registering your business will look slightly different depending on your chosen business structure.
Sole Proprietorship
According to the Hawaii Department of Commerce and Consumer Affairs, sole proprietorships do not need to register their business with the state. However, if you wish to operate under a different name other than your legal name, you will have to register a trading name online for a fee of $50.
Partnership
Even though a partnership is not a formal business structure, it must be registered with the Department of Commerce and Consumer Affairs registration division. More information on which forms to use and fees to pay can be found on the department’s website.
There is also the option to register a trading name as well.
Limited Liability Company
Registering your LLC in Hawaii is a pretty simple process. All you need to do is complete and submit the Articles of Organization; this is a simple document with all the business’s basic information. This form can be filed online for a fee of $50. You can find the entire LLC registration process in our article on how to form an LLC in Hawaii.
Corporation
To register a corporation, you must complete and file the Articles of Incorporation with the state of Hawaii. You can do this online on the business registration page of the Business Registration Department of Commerce and Consumer Affairs. The fee for filing the Articles is $50.
Step 7: Set Up Your Finances & Accounting
Setting up your finances before you start trading is a highly recommended idea. Setting up your finances entails opening a bank account for the business, applying for a company credit card, and setting up a payment method for your customers to use. If you have employees, it may be worth your while to install good payroll software as well, as this will help manage employee salaries and taxes.
If you feel slightly overwhelmed with this step, you should hire an accountant. But, even if you feel pretty confident setting this up, you will be grateful for the extra help come tax season.
Step 8: Get Business Insurance
Business insurance is must-have for any business owner, no matter what industry you are in. While there are many different insurance policies to choose from, if you had to pick only one, you should at least get general liability insurance. This broad insurance policy covers everything from damage to injury on your property
Other insurance policies to choose from:
- Business owner’s insurance
- Commercial auto insurance
- Commercial property insurance
- Limited liability company insurance
Step 9: Obtain Any Permits or Licenses Needed
The state of Hawaii does not require businesses to acquire a general business license. While you may not need a general business license, if you plan on selling items to collect tax, you will need to apply for a seller’s permit, known as a General Excise Tax License. You can apply for this license on the Hawaii Tax website.
In addition, you may need to apply for other permits or licenses depending on the type of business you run. You should also check your local city or county requirements to see if you’ll need to apply for additional permits to stay compliant.
Step 10: Build a Website
Nowadays, all successful businesses have websites, and building one yourself has never been easier. In fact, you don’t need to know any coding; many websites offer free or subscription-based web-building services with pre-made templates.
When designing your business website, keep the following suggestions in mind:
- Your business name should be visible and easy to read
- Your chosen font should also be clear and easy to read
- Avoid a cluttered and busy page as this can cause slow loading times and become difficult to read
- Keep your content up to date and relevant
- Include a good “About Us” or “Our Story” section
- Include your contact details and link to other social media accounts you have
Step 11: Hire Employees (If Any)
As you start your business, you may find that there are too many roles to fill alone, so you will need to hire employees to help you. To find good employees, ensure their qualifications match what you’re looking for. Good references are a must as well.
You will need to report any new hires to the Hawaii Child Support Enforcement Agency within 20 days from their hire date. You will also need workers’ compensation insurance if you have employees.
Step 12: Market Your Business
The final step in starting a business is to market your business. There are many different ways to market your business, and it can be done successfully on any budget. Whatever your marketing strategy, the primary key to marketing is to remain consistent.
Here are different ways to market your business:
- Make use of your business website
- Advertise on social media like Instagram and Facebook
- Hold competitions and giveaways on social media
- Create a Google Business Profile and advertise on Google
- Hand out flyers
- Attend local markets and business expos
- Advertise on your local radio or newspaper
The possibilities are endless when it comes to marketing.