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How to Start a Small Business in California

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With a population of more than 38 million, California is home to a diverse group of people. As an entrepreneur, the Golden State provides you with a unique opportunity to start a successful small business.

According to the US Small Business Administration, there are more than 3.5 million small businesses in California. Here are three additional pieces of data from the SBA about California businesses:

  • Approximately 684,000 small businesses have employees
  • Small businesses employ more than 6.3 million workers
  • There are roughly 2.8 million small businesses without employees

Now that you understand the popularity of small businesses in California, it is time to learn more about the process for getting started.

California has a number of state laws that may be different from other parts of the country.

The California Governor's Office of Business and Economic Development shares information on starting a business in the state. This includes a nine-step guide, touching on the following areas:

  • Researching and planning
  • Getting business assistance
  • Choosing a location
  • Financing your business
  • Choosing a business structure
  • Choosing a business name
  • Registering for taxes
  • Registering for permits
  • Employer FAQs (such as how to hire new employees)

By following these steps, one at a time, you will eventually find yourself with a legal business.

With each step, you should take the time to learn more about what would work best for your situation. For example, there are many types of business structures to consider: sole proprietorship, general partnership, limited partnership, limited liability partnership, limited liability company, and corporation. Understanding the pros and cons of each structure will help you make an informed decision.

While many states have struggled to add more jobs and businesses following the economic downturn, California is not one of them. The state has added approximately 500,000 non-farm jobs since the recovery began in September 2009.

It is your job to decide if starting a small business in California is the right decision. With plenty of help to be had, you may soon realize this is the best opportunity at the future you have been dreaming of.

Need help with California payroll for your small business?SurePayroll is happy to help.