How to Start a Small Business in California (CA)

California’s Most Popular Businesses

An idea for unique products or services is probably one of the first things that drew you to opening your own business. However, if you’re an aspiring entrepreneur struggling with a novel idea, there are a lot of very popular models in place for businesses enjoyed by both visitors and residents. Maybe try your hand at a drive-in theater, record label, yoga studio, sustainable shop, or even a security company.

Planning Processes

Starting a business sometimes means getting your hands dirty in the planning process. You will want to think of the proper plan to follow to open your business correctly. Here are some steps to help you get started:

1. Pick a name

When you were thinking about what type of business to open, you may have also thought up some names for your business as well. In California, there are some rules to keep in mind while choosing a business name, but don’t let that stop your creativity from coming across. The right name is important! 
 
When you go about thinking of a name, you will want to pick something that shows off your business’ values while also being unique enough to stand out in a crowd. This will be the first thing your customers see, and you want it to be a sneak peek of what they should expect when they walk through the doors.

2.  Conduct market research

It’s essential to get a solid understanding of your field of business. This could mean researching your desired audience to better serve their needs, while also studying your competition to see how to improve—or get tips.

3.  Choose a structure

When you want to open up a business, you must first pick out the structure you want your business to uphold. You can choose from an LLC, partnership, cooperation, non-profit, or sole proprietorship.

Registering in California

After choosing which structure works best for your business, you will want to register under that structure in the state. To do so, you will need information like your business’s name, an agent for service of the process who will take care of the taxes for your company, your employer identification number, and your formation documents. Depending on what type of structure you choose for your business, California may ask for more documents or certifications.

It’s All About Location

If you plan to open a brick-and-mortar business, you want to pick an area with high foot traffic and word of mouth. Cities like Los Angeles or Oakland could be great to look into. On the other hand, if you are hoping to open a fully online store, you can open it anywhere in the state and grow from there!

Focus on Banking

You will want to create a bank account solely for your business to keep your personal affairs separate. This will keep them safe if anything were to happen to the business. Another way to help keep things on the straight and narrow would be to get a business credit card so you can track your spending and manage transactions in one place. You could also look into investing in a business accountant—a person or software that can track the money going in and out and help with taxes later.

Insure Your Business

When you open your business, you also open it up to risks and possible liabilities. Getting insurance could help. This could look like Workers’ Compensation Insurance, General Liability Insurance, or Professional Liability Insurance. If your business has one or more employees in California, you need to be signed up for Workers’ Compensation Insurance.

Hiring Employees

As your business grows, you may eventually be in need of employees to help out. On top of picking the right people for your business and brand, there are other things to keep in mind as well. You must make sure you are registered in the IRS for Employee Taxes and report each of your new hires through the state of California.

Branding

Develop a good understanding of what you want your company to look like as an essential first step toward branding. Each business will have its own type of branding, but in the end, it is their message that brings in customers and creates a distinct experience for them. No matter if you are a clothing boutique or a grocery store, you can brand it uniquely.

What do you want your brand to represent?
How do you want to be seen by your customers?

Questions like these could help you figure out what that branding will be. In the end, you want to stand out from the crowd.

Next to branding, making a perfect logo can help you to stand out as well. This logo will represent your business on price tags, bags, business cards, and your website. This is an excellent format to show your branding and goals in a small picture or set of words.

Get Online

The online world has completely taken over the real world. Nearly everyone is either on their phones, computers, or tablets, so why not also put your business there? A website can be a great way to represent your business online and give even more people the chance to learn who you are—and what you sell. 
 
Social media is also a great way to get online. Whether you have a brick-and-mortar store or an online store, social media platforms like Facebook, Instagram, or TikTok can be great places to showcase yourself and your business—and gain some online traction.

Online Business

From your website, you can also give your customers a chance to buy directly as well. If you are thinking of creating a fully online store, this thought has probably already crossed your mind. Opening an online store can be simple, with companies like Ecwid helping people create their dream websites and offering resources to help their businesses grow. 
 
Ecwid has the ability to connect your products to other selling sites, like Facebook and Instagram. From there, you can have your products in the view of more customers and get more sales. They also offer a convenient dashboard where you can track all your sales from each of your sites. From this dashboard, you can also see your inventory, and Ecwid lets you know when a certain product needs to be purchased. If you are interested in opening up an online store, Ecwid offers amazing resources.

Marketing

Marketing for a physical store and an online store may look different, but both require a substantial amount of marketing for people to learn your name. That is why depending on your business’s size and growth, a budget of $250 to $1,500 should be put aside for marketing.

If you are marketing more offline, this could look like business cards, pamphlets, window signs, or billboards.

However, online marketing could consist of buying ad space on social media platforms like Facebook, Instagram, or YouTube. Those platforms are also great for creating a business page and promoting from there, even if you don’t want to pay for ads. You can showcase products and connect with your customers. Email subscriptions can also be a great method to keep a direct line of contact with customers.