With a belief that entrepreneurship and innovation can help to build a diversified and resilient economy, Hawaii state government has set itself a goal to “…foster an ecosystem of innovation, research, education and entrepreneurship that creates living-wage jobs and a diversified economy” by 2030. If you are thinking about starting a business in Hawaii but don’t know where to start then read on to discover these 10 steps to start a business in Hawaii.
Follow these 10 steps to start your business in Hawaii
Step #1: Choose your business
What kind of business do you want to open? Choose a business that suits your passion, natural strengths and personal goals but most importantly one that fills a need and/or solves a problem.
Step #2: Analyze your idea and plan the business
Once you have settled on an idea, critically analyze it to make sure that it’s viable. Pro tip: run your idea past other successful entrepreneurs as they are likely to see flaws that you may not and know a great opportunity when they see one.
Answer the following questions:
- Is there is a market for your product or service?
- What problem will your business solve?
- What are the core values that drive the business?
- What does your business stand for?
- What sets your business apart from your competition?
- Will there be a reasonable profit margin after wages and other expenses are covered?
- How many clients or sales will you need in order to break even?
- How much money will you need to invest before you can break even and where will you get the funding?
- What types of employees or partnerships will you need to establish in order to make your business work?
Step #3: Create a business plan
Once you feel confident that your business idea has potential it’s time to create a business plan. A good business plan will make it much easier to start, build, run and eventually sell your business. It’s also necessary to have a business plan to show potential investors.
Step #4: Create a marketing plan
A detailed marketing plan is an important tool to help get your business making sales. Start by identifying your primary and secondary target markets: keep their buying behaviors in mind as you fill out the details of your marketing mix.
Step #5: Secure funding
If you need to seek funding for your start-up, use your business and marketing plans to show investors that your business is a good investment. Some options for funding include:
- Bank loan
- Angel investor
- Credit card
- Crowd funding
- Borrow from 401k
- SBA loan
- Borrow or raise money from friends and family
Step #4: Purchase your domain, build a website and create a web presence
Pretty much every business needs a website and a web presence. First, you will need to choose and purchase a domain name. Before choosing your business name, check to see if it’s available as a web domain and purchase it right away. Build a website that is visually appealing, provides relevant information for your visitors and attracts the right visitors through SEO work. Once your website is built, create social media profiles, register for review sites and create a Google Local profile.
Step #5: Form your business
Decide whether your Hawaii business will be a sole proprietorship, partnership, LLC, nonprofit corporation, or corporation. Registering as a Hawaii LLC or corporation benefits business owners because they cannot be held personally responsible for debts or other liabilities of the business. In addition, unregistered business owners may need to file a DBA.
Step #6: Register for taxes
To operate your business legally you will need to register for all relevant taxes.
- Most business need a Federal EIN (Tax ID Number) to operate. An EIN is used to identify a business in its Federal tax filings and allows businesses to legally hire employees and open a business bank account.
- Hawaii businesses selling products will need to register for the Hawaii Sales Tax.
- Businesses with employees will need to register for the Employee Withholding tax on behalf of their employees and Unemployment Insurance.
Step #7: Create business banking and credit accounts
To protect your personal assets, it is very important that business owners operate their business out of business accounts. Setting up a business credit card is also a good way to establish your business credit history.
Step #8: Setup the accounting system
Decide whether you will use an outside accountant or hiring an in-house accountant. If you will be handling accounting in-house, choose quality accounting software because it can mean much simpler accounting and annual tax filings.
Step #9: Get permits and licenses
In order to operate your businesses legally, you may need to get one or more business permits and/or licenses. You may need general businesses licences, liquor licenses, reseller’s licenses, building permits, health permits, signage permits and/or others.
Step #10: Get insured
Business insurance is used to help manage the risks of running a business. Some types of business insurance that may help protect your business are:
- General Liability Insurance
- Professional Liability Insurance
- Workers Compensation Insurance (Hawaii businesses with one or more employees are required to get this insurance with few exceptions)
Need help with HR? We’ve got you covered through HR outsourcing! When you partner with Makai HR you can get on with the business you are trying to grow while we take care of your employee needs from 401(k) plans to payroll, taxes, health insurance/benefits, and worker’s compensation. You also gain peace of mind that you are in compliance with all of Hawaii’s employer laws (if you’ve ever looked you know that the list is very long). When choosing a PEO to partner with, there are many things to consider including cost, services and technology solutions.
With the cost of doing business in Hawaii at record highs, we know how important it is to keep labor costs in line with revenue. Our plans are priced competitively and include value-added services like time-in/time-out systems. Our three tiers of PEO service plans are tailored to the size of your business and specific needs. We offer a 100% paperless solution which means that your employees can manage their needs through a computer, tablet or phone. We can truly improve your employees work benefits while freeing you up to run your business.
What are you waiting for? Companies who partner with a PEO benefit from 7-9% faster growth, 10-14% lower employee turnover; and they are 50% less likely to go out of business. Contact us today to get started!