If you are thinking about starting a business in Maine, you may be overwhelmed by the sheer number of things you need to do to get your business up and running. To help you on your entrepreneurial journey, this article will go through everything you need to know about starting a business in Maine. Going through everything you need to know, from choosing your idea to marketing your business, this is your one-stop guide on successfully starting a business in Maine.
Step 1: Choose Your Idea
Behind every successful business is a simple business idea. The first step in starting your own business in Maine is to choose an idea to build your business. This plan does not need to be overly detailed in this stage of the planning process.
To get you started thinking, answer the following questions to formulate an idea:
- What are my passions and hobbies?
- What am I particularly skilled at?
- Can these hobbies and skills be turned into a profitable business?
- Will I enjoy running this business for the foreseeable future?
- Is there a gap in the market for my business?
- Are there any businesses out there already that are similar to mine?
- How will my business differ from those already open?
- Does your business solve a consumer’s problem?
You can also employ the help of your friends and family to bounce ideas off of.
Step 2: Pick a Name
The name you choose for your business is significant as this is what potential clients will see and hear first. So their first impression and thoughts about your business will be based on this name.
Here are some things to keep in mind when deciding on a name:
- In Maine, you cannot use a name that has already been registered with the Secretary of State. To avoid accidentally applying with the same name, you can search to see if your desired name is available on their database.
- Your name should be unique and easy for people to read and pronounce.
- The name should be somewhat relevant to your business’s industry.
If you are struggling to come up with a name for your business, try out some of the methods below.
- Create a word dump. This is where you write down the first words that pop into your head when you think of your business.
- Use an online name generator.
- Hold a brainstorming session with your friends and family.
- Host a survey or poll on your Facebook page.
Step 3: Write Your Business Plan
Once you have chosen your business idea and name, you must write your business plan. A good business plan is like a map or guide to your business. A business plan will include all your research, financial details, and planning, as well as how you plan on running the business day-to-day.
Business plans can also be a great marketing tool to get funding for the business.
Here are some questions that every good business plan should answer:
- What does your business involve?
- What service does your business offer?
- Why did you start the business?
- Who are your direct competitors?
- Who is your target audience?
- How do you plan on turning them into paying customers?
- What are the costs of running the business?
- What roles will be available in the industry? Will you need to hire employees?
- What are your financial goals and predictions for the first year?
If you are struggling to draft your business plan, there are multiple templates that you can use for free off the internet.
Step 4: Get Funding
Getting funding to start a business is very important, especially if you cannot afford to fund the startup costs yourself. There are three different ways to go about acquiring funding in Maine, and that is through a grant, loan, or an investor.
The state of Maine has a Job and Recovery Plan for small businesses by offering grants. You can check out the official website to see if your business may qualify. While you do not need to pay back the money with a grant, they have strict requirements. So, if your business does not qualify, your next best option is to get a loan.
The State of Maine has several loan programs available for different businesses. Visit the Maine Office of Business Development website to see which loan your business may qualify for. As a part of Maine’s Path to Recovery to support the economic loss during the Covid-19 pandemic, the state offers a couple of different loans to support businesses.
Alternatively, you can go the private route and apply for loans from banks or even your friends and family. Make sure you get any agreement on paper – even if you’re borrowing money from a close family member.
If you don’t mind other people having shares in your business, then you might want to consider getting an investor for your business. Ask your friends, family, and acquaintances to see if anybody would be willing to invest some money into the company for a percentage.
Step 5: Choose a Business Structure
Choosing the right business structure for your business is crucial. There are four main types of business structures to choose from:
This informal business structure is the simplest and easiest business structure. A sole proprietorship is a single-owner-run business without separating personal and business assets. In other words, the business is not a separate legal entity from the owner. Low-risk businesses typically favor this business structure.
A partnership is like a sole proprietorship as it is not a separate legal entity from its owners. The only difference between the two business structures is that a partnership has more than one owner, all with equal shares in the business.
Limited Liability Company
A limited liability company, or LLC, is a hybrid business structure and one of the most popular choices for small businesses. An LLC combines the ease and flexibility of a sole proprietorship or partnership with the liability protection of a corporation, making it a great choice for small business owners.
C or S Corporation
This is the most formal type of business structure available. Large companies with multiple shareholders favor this business structure. Corporations are entirely separate entities from their business owners. This business structure offers many tax benefits.
Step 6: Register Your Business
To remain compliant with the state of Maine, you may be required to register your business before you can begin to operate legally.
Maine does not require sole proprietorships to register the business with the state. Instead, they can simply start trading under their personal name. However, if you wish to operate your business under an assumed name, you will need to file this name with the municipal office in your local area.
The process to “register” a partnership is the same as a sole proprietorship. There is no need to register a partnership with the state of Maine. However, if you are trading under an assumed name, you will also need to file this name at your local municipal office.
Limited Liability Company
To register your LLC in Maine, you must complete and submit the Certificate of Formation to the Secretary of State. This can only be submitted by mail using the following address:
Secretary of State
Division of Corporations, UCC, and Commissions
101 State House Station
Augusta, ME 04333
The fee to do this is $175.
To register your corporation in Maine, you must complete and submit the Articles of Incorporation by mail to the Secretary of State. The fee to do this is $145.
Step 7: Set Up Your Finances & Accounting
Setting up your finances and accounting before you begin trading is an excellent idea. To set up your finances, you will need to open a bank account for business, apply for a credit card, and set up a payment method for customers to use.
If you are planning on hiring employees, you may consider installing payroll software and hiring an accountant to take care of the business’s accounts.
Step 8: Get Business Insurance
Maine does not require businesses to have insurance. But, most professions would advise obtaining it. You never know what will happen, so it’s good to be covered just in case disaster strikes. At the very least, you should consider investing in a general liability insurance policy. This broad insurance policy will cover everything you need when running a business. This coverage includes damage or injury on the business’s premises.
Other insurance policies you may consider using:
- Workers Compensation Insurance
- Business Owners Insurance
- Commercial Auto Insurance
- Commercial Property Insurance
- Limited Liability Company Insurance
Consult a business attorney or broker if you’re unsure what kind of insurance to get for your particular business and your needs.
Step 9: Obtain Any Permits or Licenses Needed
The state of Maine does not issue general business licenses, but many counties and cities have their own requirements for business owners. To learn more, you can check out the Maine Business portal. Depending on the nature of your business, you may also need to apply for specific permits and licenses before you can legally trade.
To determine whether or not you qualify for a sales tax certificate, also known as a seller’s permit, you will need to create an account and register with the Maine Revenue Services.
Step 10: Build a Website
Nowadays, every business should have a website; and thankfully, building one has never been easier. You have two options when building a website: hire someone to build it for you, or you can build one yourself.
If you are building your own website, here are some things you need to keep in mind:
- Check if your desired domain name is still available. There are multiple domain searches online to use.
- Ensure your business name is visible and stands out on the web page.
- Make sure your chosen font is clear and easy to read.
- Avoid cluttering your web page with multiple images and animations, as this can drastically slow loading times.
- Ensure that your website is mobile-compatible.
- Include an “About Us” or “Our Story” section.
- Provide all contact information.
Step 11: Hire Employees (If Any)
If you are planning on hiring employees, you need to be aware that you must legally report any new hires to the Maine Department of Health and Human Services on their portal. This has to be done within seven days after your new employee has started working at the business.
When hiring, ensure you thoroughly vet all applications to find someone who meets all your requirements and has the knowledge or passion needed for the position.
Step 12: Market Your Business
The final step in starting a business is to market the business. Thanks to the internet, there are so many different and creative ways that you can market your business.
Here are some ways to market your business:
- Advertise on your business website.
- Use free social media like Facebook, Instagram, and even TikTok.
- Create a Google Business Profile and advertise on Google.
- Host competitions and giveaways.
- Write a weekly newsletter.
- Attend local markets and business expos.
- Attend networking events.
If you have the budget for it, you could hire a content marketer to assist you.