PDF Guide to Doing Business in New Jersey

Guide to Doing Business in

New Jersey

Table of Contents

Section 1

Starting a New Business

3

Getting Started

3

Elements of a Business Plan

4

Construction of a Business Plan

4

Sample Business Plan Outline

6

Business Registration

7

Planning

8

Registering a Trade Name and

Incorporation

9

Regulations and Licenses

10

Marketing: The Pathway to Profits

10

Trademarks and Copyrights

11

Patents in Brief

12

Reducing the Risk

13

Forms of Business Organizations

14

Sole Proprietorship

14

Partnership

14

Corporation

16

Advantages and Disadvantages of

Different Forms of Business Organizations 16

Choosing a Location

18

Starting A Business Checklist 18

Section 2

Costs of Doing Business

21

New Jersey Sales Tax

21

Income Tax Withheld

21

Insurance

23

Employee Insurance

24

Record Keeping

26

Professional Help

26

Other Employee Issues

27

Industrial Site Recovery Act- ISRA

28

Section 3

Financial Information

29

Small Business Start-up Money

29

How Much Money To Borrow

31

State Programs of Financial Assistance

32

Federal Programs of Financial Assistance 37

Section 4

Franchising

45

What is Franchising?

45

Investing in a Franchise

46

Section 5 Procurement Opportunities 49

Set-Aside and Certification Office

50

Certifying Agencies

51

Surety Bonds

54

U.S. Small Business Administration's

Government Contracting Program

56

How to Be Paid Promptly by the

State of New Jersey

57

Additional Procurement Resources

59

Section 6

Exporting

61

Export Financing

66

Other Sources of Financial Assistance

67

Section 7

Resources

69

Regional Alliance for Small

Contractors, Inc.

70

The Procurement Technical Assistance

Center at New Jersey Institute of

Technology

72

The New Jersey Small Business

Development Centers

73

Business Management Counseling from

Service Corps of Retired Executives

77

Frequently Utilized Telephone Numbers

80

Disclaimer:

The data in this guide was updated in September of 2010 and was current at the time of publication. This guide is not intended as an exhaustive study on starting a business. When specific questions arise contact the New Jersey Business Action Center at 866-534-7789 or log onto .

Section 1: Starting a New Business

Getting Started

Most entrepreneurs are not adequately prepared to go into business. While they have the motivation, desire and talent, many have not taken time to properly investigate and research the business they are interested in starting.

Reasons to Start a Business

Before starting a small business, list the reasons you want to go into business. Use a specific and systematic approach to build a plan from which success can be evaluated.

Some common reasons for starting a business include:

? Want to be your own boss ? Want financial independence ? Don't work well with others ? Dislike policy and procedures ? Want creative freedom ? Want to fully use your skills and knowledge

To determine the right business, answer the following questions:

? What do you like to do with your time? ? What technical skills have you learned or

developed? ? Will you have the support of your family

and/or spouse? Friends? ? How much time do you have to run the

business? ? Do you have any hobbies or interests that

are marketable?

The following best helps answer the question, what niche will the business fill?

? Is your idea practical and will it fill a need? ? What/who is your competition? ? What is your advantage over existing

businesses? ? Can you deliver a higher value/better quality

service? ? Can you create a demand for your business?

The last step in the model is the pre-business checklist. Answer the following questions and write down the responses before developing your plan:

? Describe the business you are interested in starting.

? What services or products will you sell? ? Where will you locate? ? What skills and experience do you bring to

the business? ? What will be your legal structure? ? What name will you go by? ? What equipment or supplies will you need? ? How will your business records be

maintained? ? What insurance coverage will be needed? ? What financing will you need? ? What are your resources? ? How will you compensate yourself and your

staff?

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Starting a New Business

Do I Have What It Takes to Own/Manage a Small Business?

Future business owners will be the most important employers, so an objective appraisal of strengths and weaknesses is essential. Some questions to ask yourself are:

? Am I a self-starter? ? How well do I get along with a variety of

personalities? ? How good am I at making decisions? ? Do I have the physical and emotional

stamina to run a business? ? How well do I plan and organize? ? Are my attitudes and drive strong enough

to maintain motivation? ? How will the business affect my family?

Elements of a Business Plan

What is a Business Plan and Why Do I Need One?

A business plan precisely defines the business, identifies goals and serves as the firm's r?sum?.

The basic components include a current and pro forma balance sheet, an income statement and a cash flow analysis. It helps allocate resources properly, handles unforeseen complications and helps businesspeople make the right decisions.

Because the business plan provides specific and organized information about the company and how it will repay borrowed money, a good business plan is a crucial part of any loan package. Additionally, the plan can tell sales personnel, suppliers and others about the company's operations and goals.

Define the Business Plan It may seem silly to ask, "What business am I really in?" But some owners/managers have gone broke because they never answered the question.

The following sample business plan outline may be of assistance in creating the company's business plan.

A Business Plan is: ? The management and financial "blueprint" for a business start-up and profitable operation. ? Written by the business owner with outside help, as needed. ? The explanation of how the business will function and depicts its operational characteristics. ? A detailed view of how the business will be capitalized and managed.

Construction of a Business Plan

1. B usiness Description Includes your business name, address and owner identification and identifies goals and objectives. Further, the description clarifies why the business person wants to be in business.

4

Starting a Business

2. P roducts and Services Describe what the company is selling and why. Explain, in detail, what products and services will be offered.

3. S ales and Marketing Sales and marketing are the core of business rationale. A business plan should address several basic questions:

? Who and how large is your market? ? How will the business be competitive? ? What pricing and sales terms are

planned? ? How will the business market its products

and services?

4. O perating Requirements The plan should identify and describe the equipment, facilities and people necessary to generate products and services. How will the products and services be produced and made available to the customer?

5. F inancial Management This is the most critical part of any business plan. Businesspeople will establish vital schedules that will guide the financial health of the business. For a new business, the plans should include:

? Projected "start-up costs" ? Expected profit or return on investment

(ROI) for the first year ? Projected income statement and balance

sheet for two years ? Projected monthly cash flow statement

for 12 months

Whether your company is young or established, the business plan should include:

? Income statement and balance sheet for the last two years

? Projected income statement and balance sheet for the next two years

? Projected monthly cash flow statement for 12 months

The plan should include an explanation of all projections. If you feel your finance or accounting knowledge is not sufficient to prepare these statements you should seek professional assistance. The bottom line is: will, or does, the company make a profit?

6. C oncluding Narrative This segment of the plan should summarize business goals and objectives and send a message that owners are committed to the success of the business.

Put Your Best Foot Forward

The business plan should be complete, clear, neat and accurate. It will be an extension of you and your business.

The length of a good plan will vary from a few pages to a hundred or more. The plan should provide a sound "blueprint" for the business and entice any reader to want to know more.

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