PROFITABLE PLANNING: CONTACT WITH GOVERNMENT AGENCIES EARLY IN THE PLANNING STAGES OF BUSINESS IS IMPORTANT (PART 2 IN A SERIES)

Not all businesses have a business plan. Perhaps they should.

Business plans are a guide to a business. It organizes, on paper, ideas as to why you are in business, who your customers and competition are, strengths and weaknesses and your plans for the future.

Simply put, business plans show a complete story about a business as briefly as possible.

Business plans are required by the Small Business Administration (SBA), and are strongly preferred by private lenders.

Here, in the second in a series of articles concerning the start of a new business, a look at a checklist for starting a new business as it proceeds in its first year.

Owning a business is the American dream. But, as a business owner, you will need a plan to avoid pitfalls, to achieve goals and to build a profitable business.

Contact with local, state and county government agencies early in the planning stages of business is very important.

These contacts can provide information that is essential to your business operation.

Most cities and counties require that businesses be licensed.

"If you live and do business in the city of Cape Girardeau, you'll probably need a license," said Pam Seal, who writes hundreds of business licenses at City Hall each year. That includes all retail businesses, plumbers, electricians, painters, contractors and more. The latter group must also have a "trade" license, before applying for local permits.

About the only people in business who are not required to get licenses are individuals who have lawn-mowing or housecleaning businesses, said Seal.

But there is a lengthy list of occupations requiring licensing.

They include a blacksmith shop, carnival and/or circus operator, "hawker or huckster," peddler, auctioneer and much more.

And, in most cases, if you need a city license, you'll need a county license.

County license can be obtained at two Cape Girardeau County sites -- at 44 N. Lorimier in Cape Girardeau and at county offices in Jackson.

Places to find help and information

If an entrepreneur is looking at a retail business, they'll have to pay a visit to the Missouri Department of Revenue, 3102 Blattner Drive, Suite 102 in Cape Girardeau. There, they can receive retailing credentials -- license, retail and a use tax number. There could be other state licenses due.

The Missouri Business Assistance Center maintains a database that includes information on state-level licenses, fees, permits and requirements related to business operations. That database contains information on more than 300 licenses, permits and requirements.

You can check the MBAC at mbac@mail.state.mo.us or by calling (888) 781-2863.

Another valuable source of information on starting a business is the local Small Business Development Center (SBDC) in Cape Girardeau. The SBDC, located in Dempster Hall on the Southeast Missouri State University campus, offers help to both established businesses and those that are just beginning.

The goal of the SBDC, says Director Buz Sutherland, is to stimulate diversity and growth in the small business sector of the economy. The SBDC assists new and existing businesses to become more productive and more profitable.

The SBDC, which offers services to manufacturers, wholesalers, retailers and other companies, represents a "Partnership for Economic Development" between Southeast Missouri State University, the U.S. Small Business Administration, Missouri Department of Economic Development, local financial institutions, area utility companies and Southeast Missouri cities.

High on the list of "early" things to do is consult with an accountant, or employer service representative, to determine your rights and responsibilities as an employer.

Circular E, Employer's Tax Guard, which can be obtained from the local IRS office, explains federal tax withholding and Social Security tax requirements.

Once you start paying a salary or wages to employees, you must collect taxes from any employee. Primary taxes include federal and state income taxes, Social Security (FICA) and Medicare taxes.

For this you must apply for a federal employer identification number (EIN), Form SS-4. This number issued to identify your business on payroll and income tax returns as well as for other federal tax purposes.

The Missouri Division of Workforce Development offers employment services and other assistance to employers and employees. The Workforce development group offers a network of "one-stop, career centers" offering the latest information.

A checklist for staring your own business

The following checklist can be used as you proceed through the process of starting your own business.

First 30 days

* Prepare a written business plan, including a marketing plan.

* Estimate your start-up costs.

* Select an attorney and accountant.

* Obtain local business licenses through the city or county offices.

* Check local zoning ordinances, building permits and fire codes through the city or county government.

* Determine whether the business requires a state or federal license or permit.

* Select a banking institution and open a business account.

* Select your business fiscal year.

* Determine legal structure of your business (sole proprietorship, partnership, limited partnership, corporation), and fill necessary forms and paperwork with the secretary of state's office.

* Apply for sales a tax number if you will be selling retail or wholesale.

* You may need a Federal Identification Number (EIN).

* If hiring employees, determine the wage and hour laws, and requirements for worker's comp, etc.

* Check if OSHA laws effect your business.

* Some other meetings laws (bylaws, board elections, etc.) could apply.

First 60 days

* Obtain business insurance.

* Join a professional association or organization (Chamber of Commerce).

* You may need to make quarterly estimated income tax payments to the IRS and self-employment tax payments.

* If forming a corporation, file forms with the IRS within 75 days.

By end of first year

* File annual tax information for state and federal government.

* Keep a good set of records for all business activities.