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Cash Flow Management
Can you help me with cash flow projections?
Absolutely. If you’re worried about your cash position or wondering whether you’re going to be able to pay your bills later this year, then it’s time to do a cash flow and profit plan projection. Creating a projection will help you develop a profit plan and cash budget forecast that will help you make sure you keep enough cash on hand to pay bills, meet payroll, and plan for one-time expenses such as equipment purchases or tax payments in coming months. Ultimately, it will help you sleep better at night. If you haven’t already, make an appointment to work with an SBDC advisor on these crucial steps.
How do I estimate my startup costs and cash flow?
Financial projections are estimates of the financial future of your business. Creating financial projections is an important step in determining the feasibility of your business. To ensure sufficient cash is available for operations, you must be aware of your business’s current and future financial position. Additionally, financial projections are a critical part of your business plan and/or loan proposal. Although the numbers are based on estimates, do not consider such projections as “a guess.” Research plays an important role in accurately determining future sales and costs. The projections serve as a basis for planning and are likely to change as more information becomes available. Creating financial projections may seem intimidating. It is important to remain conservative as you develop them. In other words, understate revenues and overstate costs.
How do I make predictions about future sales and expenses in order to create a cash flow projection?
Research your industry, look for trends you may be able to take advantage of, look at the past, figure out what you might do differently going forward, look at details, test the market, look at your social media presence. Be the most informed person possible on the subject of your business. Your SBDC consultant can help with the process. Keep your notes because if you apply for funding your banker may want to know how you came up with specific numbers.
How can I figure out my break even point?
That critical break even point is a must to know. There are several factors involved in getting an accurate number. First, figure out and list your costs and expenses. Determine which ones are fixed expenses, like rent or mortgage payment, and which ones may vary from month to month. Then list your income from all sources. Your break even point is the place where your income equals your expenses. Any additional income above that point is profit. Here at the SBDC we can help you figure it out if you would like assistance.
Human Resources/Managing Employees
Who should I have on my team?
Having a working relationship with the following professionals will save you time and money down the line, and put your business on solid ground: CPA (Certified Public Accountant), Lawyer, Insurance agent, Banker, Bookkeeper, Coach (us!). If you’re finding these hard to come by, call us. We’ll help you think about the characteristics to consider in developing a trustworthy team.
How do I register to become an employer?
To register as an employer, you need to obtain a federal Employer Identification Number (EIN) from the IRS and secure workers compensation insurance. You then need to establish state income tax withholding and unemployment insurance tax accounts by filing IBRS.
Have employees complete and keep in employer’s files: Employee’s Withholding Certificate W-4 obtained from the IRS and Employment Eligibility Verification Form I-9 obtained from the U.S. Department of Immigration and Naturalization.
What financial responsibilities do I have for my employees?
You must withhold federal and state income taxes, contribute to unemployment and workers compensation systems, and match Social Security and Medicare contributions. You may also wish to inquire about key employee life or disability insurance and consider establishing an employee health insurance program.
What is OSHA?
The U.S. Department of Occupational Safety and Health Administration (OSHA) oversees workplace safety. All employers are required to provide a safe and healthy workplace and are subject to no-notice safety and health inspections by OSHA. Employers with more than 10 employees are required to maintain a record of injuries on the OSHA 200 form, which must be available for inspection for a period of five years.
How do I know if I should hire my first employee?
When you are considering hiring be sure to address these conditions: Can you afford an employee? Will this employee create more sales, help you deliver your product or service more efficiently or handle tasks that free you to do one of these two things? Would an employee allow you to give your customers more efficient service or quicker delivery, with the result that better service would lead to more customers or an increase in sales? There’s a tension between how much the employee’s salary and benefits will drain your business’ budget and how much extra money the employee’s presence will bring in. Another item to think about is whether you need someone full time, part time or will an independent contractor be more effective for your business?
How can I effectively interview applicants?
Interviews should be as relaxed of a meet and greet as you can make them. By staying relaxed, you allow the interviewee to shine. Ask questions that allow them to talk about themselves and their knowledge, their attitudes and opinions. Don't spend a lot of interview time talking about you or your business. If they ask questions, be willing to respond. If you decide to pursue a candidate, you can talk about your job in more detail at that time. Use interviews along with skills testing, personality assessments, background checks and references in order to help determine whether or not the applicant is suitable for your position and your business. This way, you will have an idea of the applicant’s personality as well as qualifications.
Which federal posters do small businesses need to post?
The federal posters that should be on display for your business vary widely depending on the type of business you are in. The U.S. Department of Labor has an interactive Poster Advisor tool that will walk you through the steps to determine the posters you will need specifically for your particular business.
In addition to knowing what federal labor posters you should have on hand, you should also visit the Idaho Department of Labor to determine the state labor posters that are required. Your insurance company will provide a workers compensation poster.
Idaho Small Business Development Center (SBDC)
What's the difference between the SBA and the SBDC?
The U.S. Small Business Administration (SBA) is a federal agency that provides aid, counsel, and disaster assistance to small businesses. They are able to fulfill their mission, in part, through the creation of Small Business Development Centers (SBDC). The Idaho SBDC is funded, in part, by the U.S. Small Business Administration (SBA), as well as matching funds from the state of Idaho, partner colleges and universities and contributions from other sponsors throughout the state. SBDCs are located at colleges and universities nationwide and offer one-on-one, no-cost confidential counseling and low-cost workshops. SBDCs are part of the nation-wide Association of Small Business Development Centers (ASBDC).
How does business counseling work?
The Idaho SBDC is staffed by certified business advisors and provides entrepreneurs with business assistance and tools to aid in their success at no-cost to the business. Our experienced advisors cover topics that include business planning, financial analysis, marketing, accounting, cash flow projections, and new business feasibility, to name a few. If you are interested in setting up an initial appointment, please complete our online client registration. We provide assistance for new businesses and established businesses looking to grow, businesses that may be preparing to sell or close and individuals planning to purchase an existing business.
Does the SBDC only help start-ups?
No, the SBDC business counselors are with you every step of the way whether you’re just starting, maintaining, growing or exiting your business. We can also help with the buying and selling of businesses. Growing season is every day for SBDC clients, regardless of the region, the season or the weather. We know what it takes to succeed in business, every step of the way, and our clients are reaping the benefits of SBDC expert assistance. Grow with us.
Ok, I see I need an appointment to meet with a counselor. How do I set up one?
Can we meet in the evenings or weekends?
Each consultant sets their own hours. Please contact your consultant directly to find out if she/he is able to meet outside normal business hours. You may be able to meet via Zoom or Skype.
How do I copyright a product?
A copyright is the exclusive legal right given to an originator or an assignee to print, publish, perform, film, or record literary, artistic, or musical material, and to authorize others to use their material. Copyrights are filed with the U.S. Copyright Office. Learn more about copyrighting and the process of getting your material protected by visiting their website.
How do I file a patent or trademark?
If you have a new technology or innovation that you're developing, we'll be glad to help you understand the patent process and refer you to a patent attorney if necessary. Be aware that scams abound in this area. A provisional patent application is NOT a patent application.
SBDC consultants can help with preliminary trademark searches related to naming your business or creating a unique logo. For details on registering a trademark see the FAQs section of our companion website, business.idaho.gov.
What legal aspects do I need to consider when starting my business?
Many different legal aspects must be considered when starting or growing a small business. These include: the business structure you choose (entity type), zoning, permits, taxes, registrations, worker’s compensation insurance if you have employees, patent and trademark registrations, leases, contracts, discrimination, and much more. The SBDC does not provide legal advice or services and strongly recommends you consult with an attorney.
How should I structure my business?
Your choice of business structure impacts taxes, liability and other areas of your business. The basic structures of business ownership are sole proprietorship, limited liability company (LLC), partnerships, c-corporations and sub chapter s-corporations. Among other considerations, selection of a business structure depends on the level of control you desire, the size and nature of the business and possible vulnerability to lawsuits. Read through the benefits and limitations of each structure type on the Legal Structure page of business.idaho.gov then consult with an attorney and an accountant to determine the structure that works for you.
How can I protect my assets?
Protecting your personal and business assets begins with the business structure you choose. Registering an LLC or corporation offers liability protection if you are careful not to co-mingle your business and personal finances. Your attorney should create the appropriate legal agreement to govern your business - Articles of Incorporation, an Operating Agreement or Partnership agreement. All need to conform to Idaho law, include details of how business finances will be handled and by whom and be regularly updated. Registering only an assumed business name, which creates a sole proprietorship, offers no legal protection and puts your personal assets at risk, as well as your business ones. Your SBDC consultant can suggest some safeguards to help protect your assets, beginning with good business practices. We are here to help clarify and define additional practices that will help reduce your risks.
Do I have what it takes to own/manage a small business?
You will be your own most important employee, so an objective appraisal of your 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?
- Can I afford to start a business?
- How will the business affect my family and are they supportive of the time and financial commitments?
Think of the four entrepreneurial Cs: Control of your time and income; Creativity in your profession; Cash - the possibility to create more than a paycheck; Challenges - you must like them. If you can say yes to these AND you are willing to withstand risk and possible failure, you have what it takes.
How do I convert from a Sole Proprietor to LLC
To change from a sole proprietorship to an LLC you will need to first register the LLC with the Idaho Secretary of State. Then you will need to transfer licenses and permits to your new LLC and there are details included in that process: taxes, state requirements, and separation of personal property. As an LLC, you must maintain separation between business and personal finances. If you have employees, you will need to transfer your withholding and unemployment accounts to the LLC. The Small Business Development Center can refer you to attorneys and CPAs that can assist you.
I need to reinvent my business, how can you help?
One needs to look no further than the newspaper industry today to realize that even the most notable of business models needs to reinvent to survive. Successful companies find ways to make industry change their catalyst for growth. Reinvent your company and plan for change by understanding your industry and the direction it is headed, your business assets, core competencies and strengths. With that knowledge, you can build a toolkit that will reinvent the way you do business. If you haven’t already, apply to work with an SBDC business advisor for free to guide you through this next step of your business stage.
How can you help me grow my business?
We have several tools to help you identify new customer segments and revenue streams and we can also help you reduce costs and increase efficiency. We use the Business Model Canvas, Lean Launchpad, Profit Mastery, Reference USA and various databases to help you develop a growth plan.
How do I start an online business?
When starting an online business, we suggest you treat it exactly the same as a brick and mortar business. Start with research and planning.
- Is there a market for your products or service?
- Do you have experience working with the audience you want to attract?
- What value are you bringing your potential customers?
- How are your competitors doing and what are they doing to attract online customers?
- What start up expenses will you have?
- Do you have the technical skills needed to manage an online market place or can you learn them?
- Do you have reliable high speed internet service?
If you answered these questions and would like to move forward, make an appointment with an SBDC consultant to discuss your idea.
Can the SBDC help me start a nonprofit?
No, we are prevented from doing so because the SBDC is an economic development arm of the state of Idaho. Therefore, we rely on tax-supported appropriations and are mandated to work only with for-profit companies. We welcome you to any SBDC workshops that may assist you in your venture. You are always welcome to utilize our no-cost resources on our website. For non-profit assistance, please visit the Idaho Non-Profit Center and the Internal Revenue Service website.
Can the SBDC help me start a marijuana-based business?
Our cooperative agreement with the Small Business Administration (SBA) states our award is governed by and constituted under federal law. Since marijuana is illegal under federal law, we are prevented from assisting marijuana growers or distributors.
What do I need to do to start my own business?
One of the most important things to do before starting your own business is to determine whether or not your business idea is feasible. You must research your idea to ensure that your business has a favorable chance for success, will meet your expectations, and will provide an adequate reward for the risk involved. It is wise to validate your beliefs about your business concept through research and careful planning because you will not have time to do it once you start your business.
What is the best type of business to start? Is it better to buy an existing business or start a new one?
Typically, new businesses are based on the owner’s interest or passion, since business ownership requires a big investment of time and resources. Having previous skills or knowledge relevant to a particular trade or industry is also a plus when considering what kind of business to start. Regardless of the type of business, you must determine whether adequate demand exists for the product/service you will offer.
As to whether to buy or start a business, consider your goals and potential return on investment. An existing business should have established procedures and processes, operations, reputation, and a customer base. These are assets – and the reason existing businesses frequently sell at a premium. If the business is lacking in these areas (and priced accordingly), beware. Also, an existing business may have “baggage” that can cause problems for the future owner, whereas a new business can start with a clean slate.
While it may take less money to start a new business than it does to purchase a going concern, it takes time and can be very difficult to build the business. The new business also has no track record on which to base decisions. Significant working capital is often required to grow a new business. The bottom line is that every business purchase situation is different and should be carefully evaluated on its own merits.
Where can I find out about licenses and taxes?
What business should I choose to start?
Usually, the best business for you is the one in which you are most skilled and interested. As you review your options, you may wish to consult local business experts, such as the SBDC or a SCORE counselor. Do your market research, both locally and nationally, to understand the growth potential of your business idea. Matching your background with the needs of the local market will increase your chance of success.
How long will it take to start a small business?
As long as it takes you to complete your feasibility study, prepare your business plan, gather your money, buy what you need to buy, and arrange your business operation affairs. This could take a few weeks or many months. If you have difficulty with any of these items, the time to learn and solve problems must be added.
What business licenses do I need to start?
Different licenses may be needed for different business types or professions. For example, a plumber or a cosmetologist needs a professional license in Idaho, but a retail store does not. Some municipalities require business licenses and some do not. Your city clerk can tell you if you need one. (Idaho does not have a state business license requirement.) We are here to help you sort through the licenses and permits (such as a sales tax permit) you may need.
Note that licenses differ from the type of legal entity you choose for you business (e.g. LLC, sole proprietor, C Corp). You need to first register your entity type with the Idaho Secretary of State before you apply for licenses and permits.
What basic skills do I need to run a business?
The basic skills include:
- product or service knowledge as it relates to your business
- record keeping and creation of financial statements
- financial management, including breakeven analysis
- personnel management if you have employees
- marketing and market analysis skills
- legal structures
- federal, state and local taxes
- communication skills
In addition to these technical skills, it is most important to have a willingness to learn, adapt, and make changes in a timely way.
What initial costs should I consider?
Initial costs are both one-time and recurring expenses that are needed to set your business in motion. There’s no way you can start and build a successful small business if you don’t have the funds to back it up. Start by making a list of ALL your initial costs, no matter how small or insignificant.
- name and entity registration with the Secretary of State
- legal fees
- accounting fees
- licenses and permits
- rent and security deposits
- building/remodeling if appropriate
- initial product inventory
- furniture and equipment, including computers and software
It’s not enough to consider how much a large piece of machinery costs. You also need to think about the costs involved with transporting it or setting it up. Everything needs to be accounted for. Then consider your ongoing costs (expenses you anticipate paying again and again), such as rent and utilities. Once you know what it may cost to start your business you can decide whether to move forward or wait awhile.
How can I get my business certified as minority or women owned?
The federal government considers a minority-owned business as one owned by a woman, disabled person or anyone of a nationality other than white. The business must be owned and at least 51% controlled by one or more minorities. It is a self-certifying process and no paperwork needs to be filled out unless you plan to apply for government contracts. If you are interested in federal or state government contracting, contact Idaho Apex accelerator for assistance in becoming certified.
What insurance should I have?
An important aspect of your business is a well-planned insurance program. Types of insurance you should consider are:
- Property Insurance
- Liability Insurance
- Product Liability Insurance
- Automobile Insurance
- Worker’s Compensation if you have employees
- Business Interruption Insurance
- Health Insurance
- Life Insurance.
Your SBDC consultant may have local referrals or contact an insurance agent who specializes in business insurance. Also visit the Insurance page of Business.idaho.gov.
Should I buy a franchised business to start?
Approximately 40 percent of present-day retailing in the U.S. is done through the franchise method, which makes owning a franchise an appealing option. There are definite advantages to starting out with a franchised business, but it is important to be knowledgeable about the different kinds of franchising options available to you. Some offer fair value for what you pay and others are rip-offs. Get legal or business counseling advice before purchasing a franchise. You may also visit SBDC partner FranNett.
Should I buy an existing business to start?
The advantage of buying an existing business is that it is already established in the market. It has customers and is carrying on business. You avoid the hassle and expense of starting from scratch. The trick is finding a business that fits your desires and capabilities. Is it the kind of business you want? Can you afford it? Can you operate it? Is it profitable? Does it have a good reputation?
Make sure you work with an SBDC consultant and a tax professional to understand the value in what you are buying and ensure there is information and systems in place to help you take over. Your attorney can prepare a buy/sell agreement that aligns with Idaho law.
Since I’ve never had any trouble obtaining a home mortgage, credit card, or auto loan, shouldn’t I be able to easily obtain a loan for my small business?
Obtaining a small business loan is not the same as getting a personal loan. It is much more challenging to obtain a loan for a small business than a loan to purchase a home or car. You should not assume that just because you easily obtained a personal loan that you will be able to obtain a small business loan. Business loans typically take more time, require more documentation, require collateral and are more highly scrutinized.
What is an SBA loan and how do I get one?
An SBA loan is a loan provided by a bank or other lender that has been guaranteed (backed) by the U.S. Small Business Administration. (The SBA does not make loans.) The guarantee assures the lender that it will be repaid a portion of the money it loans even if the borrower fails to repay the loan. As a business owner, you will make a request to a lender (usually your local bank) for funds needed for your business. The lender will evaluate your request and decide whether it can make the loan to you on its own. If a lender feels the request has merit but cannot make the loan without additional support, then the lender can request an SBA guarantee. SBA considers issues such as collateral, credit, equity, and loan repayment ability when making a determination on a loan. SBA does not provide grants to small businesses. With the exception of disaster loans, SBA does not provide direct loans. Your SBDC consultant can provide more information on SBA loans.
How much money can I borrow? Is it possible to get 100% financing for my business?
How much you can borrow is a decision that rests with your lender. Some criteria your lender will consider are: how much money your business plan says the project will require, how much collateral or personal investment you are willing to put into the business, and your personal and business credit history. As you develop a business plan, you must gather the appropriate financial data to make informed projections regarding startup costs (or expansion costs for existing businesses). These projections should show you how much you need to borrow and help you determine your ability to repay the debt.
You are unlikely to obtain 100% financing for your project from a lender. Lenders expect the borrower to share some of the risk and typically require an individual to cover at least 20% of the financing cost to start a business. Some banks will require an even larger owner equity injection depending on the industry or type of business. The equity you have or will have in the business will also be a factor.
How can I find out my credit score?
What do I need to get a business loan?
In order to apply for a loan, you will need at least three years worth of tax records for the business or personal tax records if you are not yet in operation; a personal financial statement, good credit and copies of any outstanding contracts (for example, your lease). The lender will usually want to see a thorough business plan that includes cash flow projections, a market analysis and an operational plan. Your SBDC consultant can help.
Does the SBDC offer loans?
No, the SBDC does not offer loans. Our services are technical and educational in nature. SBDC consultants will assist in developing your business plan, calculating financial projections, comparing loans and preparing you to select and meet with a lender.
What are the risks of borrowing from a lender I located on the web?
There are many. Please see an SBDC consultant before proceeding. We have run across more unscrupulous lenders on the internet than we have good ones. As a business owner, you may not have normal consumer protections that you would with personal loans. High rates, fees, access to your bank account, high pressure, the inability to pay them off, and other problems abound.
What alternatives are there for financing a business?
Committing your own funds is often the first step in financing. It is certainly the best indicator of how serious you are about your business. Risking your own money gives confidence for others to invest in your business. Seeking a loan from family and friends is another option. Think very carefully before you take on partners or investors in your business. Talk with an attorney or an SBDC consultant before agreeing to a partnership or outside investor and be certain to have your attorney create a legal partnership agreement or similar document for your protection.
What financing is available when your credit rating is bad or you have a bankruptcy?
Unfortunately, traditional financing options are very limited and often nonexistent. At best an individual may try to work with a micro-lender or economic development organization, though poor credit will still be an issue. Other alternative financing options to explore include asking friends and family members to invest. If necessary, you may need to work on improving your credit history and put some time between the problem and a new credit application. This will mean waiting to start your business, but it may be the best alternative. Be very careful about scams and stay away from predatory lenders who will want access to your bank accounts and charge an exorbitant interest rate.
How should I prepare to meet with a business banker?
First, set an appointment. Then write down why you need the loan and how much you need to borrow. Bring a copy of your business plan, including financial statements and projections. If you do not have three years of history with the business, are not making a profit, or don’t have substantial security to offer, be prepared to be turned down. Your SBDC consultant may be able to help you prepare for the appointment. If you are turned down, an alternative lender may need to be considered.
COVID-19 General Support
What is the difference between collecting Unemployment versus PPP?
if this is for yourself, you can get PUA (Pandemic Unemployment Insurance) or PPP based on your Schedule C net taxible income or 1099 income. (At 2.5X your average monthly income) However, the Labor Department will deduct any hours you work on your business from your award. So, do the math to see if you have a better benefit from PPP or PUA. If PPP is for your employees, you can still get PUA for yourself with the same rules. However, if you collect unemployment be mindful of the payroll parameters of the PPP when you apply for forgiveness. Do the math first to decide what works for you and your situation. An employee is not eligible for unemployment if they are full time. There are some parameters for part-timers who apply for unemployment.
What are the best options for capitalization for sole owners/proprietors?
You may be eligible for all programs: EIDL, PPP, Idaho Cash Grant, Unemployment Insurance. Perhaps your accountant or SBDC consultant can help you make that determination.
What requirements are there for part-time employees that have other jobs also? Do I have to pay them the part-time wages during the down time with the PPP loan?
That is your discretion. If you want forgiveness for your PPP loan, you will be forgiven to the extent that you keep your total payroll and full time headcount as compared to monthly average of 2019. And you have to use 60% of your award on payroll to get forgivelness. Whatever is not forgiven will be loaned to you at 1% for a term of two years.
Does a business owner need to have the same employees in place before February 15 as thereafter? Is this about the specific employees or the number of employees?
No. They will not check the names of your employees. You must maintain your FTE (Full Time Equivilency) calculated at 1 for each full time employee and .5 for each part time (under 40 hours) employee.
If a small business owner has taken a consistent monthly draw every month for the past few years, but never put themselves on payroll like employees, can the PPP be used for an owners draw?
Yes you can. As long as you can document the draw and employee payroll. If you are a sole proprietory, your award is 2.5% of your taxible income on your Schedule C, Schedule F or Schedule K.
How can this help sole proprietor with no employees? I rent space in a salon to run my business, can this help me?
Yes. 60% must be payroll and your business rent can be a part of the remaining 40% when you apply for forgiveness. You are eligible for PPP at 2.5 X your taxible income as it appears on your 2019 Schedule C or K-1. However, you may want to compare that to collecting Unemployment Insurance.
Does claiming unemployment prevent you from getting PPP?
No. But, you can’t use these monies for the same purpose. So if you collect unemployment be mindful of the payroll parameters of the PPP and that you may have trouble getting forgiveness. Do the math first and track scrupulously.
Do PPP loans cover paid sick leave?
Yes. PPP loans covers payroll costs, including costs for employee vacation, parental, family, medical, and sick leave. However, the CARES Act and FFCRA excludes qualified sick and family leave wages for which a credit is allowed under sections 7001 and 7003 of the Families First Coronavirus Response Act.
I heard about an additional $600 more per week? When does this start?
Originally the CARES Act includes Federal Pandemic Unemployment Compensation (FPUC), which adds an additional $600 to each claimant’s weekly payment until July 31, 2020. As of 1/1/2021 This is effective until 3/31/21 there will be an additional $300 per week.
Are there any additional grants or assistance help in Idaho beside the Federal relief fund?
Idaho is offering $10,000 grants to any business who did not get other assistance, who are registered with the Idaho State Tax Commission and have a TAP account. Idaho is also offering a variety of municipal grants. Check with your city to see what is being offered.
What if an eligible borrower contracts with a third-party payer such as a payroll provider or a Professional Employer Organization (PEO) to process payroll and report payroll taxes?
The SBA recognizes that eligible borrowers that use PEOs or similar payroll providers are required under some state registration laws to report wage and other data on the EIN of the PEO. In these cases, payroll documentation provided by the payroll provider that indicates the amount of wages and payroll taxes reported to the IRS by the payroll provider for the borrower’s employees will be considered acceptable PPP loan payroll documentation.
Will workers qualify for unemployment benefits if the coronavirus (COVID-19) causes an employer to temporarily or permanently shut down operations?
Unemployment insurance benefits are available to individuals who are unemployed through no fault of their own. If an employer shuts down operations and no work is available or reduces an individual’s hours due to a drop in business, this would be considered a lay off due to lack of work and the individual may be eligible for benefits. Anyone can apply for benefits, and it will be evaluated on the individual merits.
If an employee receives unemployment benefits as a result of a coronavirus-related business shutdown, will my unemployment insurance account be charged?
It depends. Part of Gov. Brad Little’s emergency proclamation provides that experience rated employers (most businesses) will not be charged for unemployment claims attributed to COVID-19. There is no change to cost reimbursed employers. Cost reimbursed employers include non-profit and government employers.
Will my employees be required to look for work if I had to temporarily or permanently shut down operations for work because of coronavirus (COVID-19)?
It depends. If they are unemployed due to COVID-19 related reasons and you are plan on having them return to work, they are not required to register for work or seek work. They will need to answer ‘yes’ to the question asking if they're returning to work on the UI application. If they are not returning with you, they will be required complete two work search activities per week.
How can a company get workers back if they are considered attached and the company reopens but the employees would prefer to get unemployment insurance instead?
First, be sure you communicate the expectation to return to work with as much detail as possible at the time employees become separated. Then, ensure they were clearly instructed to come back — speak with them, send an email to the email address, text them, etc. Then, let the Idaho Department of Labor know who didn’t come back. That person is missing available work and would need a qualifying reason to do so and may lose their benefit. (either a personal compelling reason or an illness, and even then it has to be less than 1/2 of their weekly benefit amount).
Are these loans going to be taxable?
PPP and EIDL are not taxible and the expenses are deductable for federal taxes.
For the self-employed, is the Pandemic Unemployment Assistance benefit to be based on the sole proprietor's gross income or based on net profit?
Net taxable income taken from your 2019 tax return.
If there is a separation due to the coronavirus, am I required to pay accrued vacation/PTO or sick pay?
It depends. Idaho law does not require the payment of vacation, holiday or sick pay. These items are agreed upon between the employer and the employee. If there is any change in a policy, the employee must be notified prior to the change. For U.S. Department of Labor Wage and Hour guidance on issues around COVID-19, its effects on wages and hours worked under the Fair Labor Standards Act and job-protected leave under the Family and Medical Leave Act.
What are the specific steps (verification process) to obtain loan forgiveness (conversion to a grant) on the PPP?
The PPP is forgivable if you spend 75% of your loan on payroll to the extend that you match your full time head count and dollar amount of your monthly average of 2019 and up to 25% on business mortgage interest, leases, and utilities. The actual “process” for doing this hasn’t not yet been revealed but you will reapply through your banking institution.
What does marketing my business involve?
Marketing is one of the most important aspects of your business. Without marketing, potential clients can't find you. Marketing consists of four elements often called the "four P's": Product - the item or service you sell. Price - the amount you charge for your product or service. Promotion - the ways you inform your potential clients about who, what and where you are. Provision - the channels you use to get your product or service to the customer.
Marketing encompasses much more than just advertising or selling. A major part of marketing involves researching your customers: Who are they? Where are they located? How do you reach them? What do they want? (Great product? Great customer service? Follow-up support?) What can they afford? What do they think? Your understanding and application of the answers to such questions plays a major role in the success or failure of your business. For assistance in creating a marketing plan, contact your nearest Idaho Small Business Development Center.
What kind of market research can you help me with?
SBDC advisors have access to SBDCNet, which is a national clearinghouse of market research data such as ring studies, industry reports, articles and archives. Our advisors also have access to university databases and federal databases like the US Census Bureau and IBISWorld. Advisors do not write your marketing plan for you.
How do I obtain a domain name for my business?
Start by going to any online directory of domain names such as googledomains, godaddy.com, or another directory. If the name you’ve chosen is not already registered, you can pay the online directory an annual fee for the right to use the domain name. You may also be able to buy an existing name from its owner at a typically higher cost.
How can I find profiles on typical industry customers?
There are a few places you might try to locate these kinds of statistics. Trade and industry associations and groups often conduct extensive market research and make this research available to members. While they often focus on national or statewide trends, you might find local statistics through a group’s local chapter. You may also get valuable information from local chambers of commerce, economic development centers and business sales tools like IBISWorld, an online database. The SBDC can also recommend relevant, up-to-date sources of information on your industry.
How do I find suppliers for my business?
Besides using online search engines to find specific suppliers, SBDC consultants may have information concerning international, governmental, and private suppliers for your specific business activity. Another option is to attend industry trade shows. Trade shows are a great place to meet suppliers and wholesalers. Trade Show News Network is a way to find those shows and the suppliers who attend them.
What are some resources to help with marketing research?
Free: SBDCnet Industry Links – resources by industry (click on “Industry Links”). County Business Patterns – provides Census data on establishments, payroll and employee size for all U.S. counties by SIC.
Paid: IbisWorld Industry Reports – guide to industry information, research, and analysis for many industries. Northern Light Market Strategic Research Portals – market and competitive intelligence. BizMiner – reports on industry, market and financial trends by size of business. To access Zapdata or IBISWorld, contact an SBDC consultant. Both databases search U.S. markets by SIC code. MarketResearch.com – offers both free and paid databases of market research reports.
What is a Sales Pipeline?
A sales pipeline is a visual snapshot of where customer prospects are in your sales process. Sales pipelines show you how many deals a business is expected to close in a given week, month or year. Typically a sales pipeline is a plan viewed or maintained in a customer relationship management (CRM) system.
What is Google Business Profile (formerly Google My Business?)
Google Business Profile is a free service Google provides to help your business claim and manage its free Google listing. The listing contains details about your business. Your listing appears on the right side of the search screen whenever a user searches for your business by name. The Boise SBDC office has an employee who is a certified Google Partner and business consultant. She is happy to meet with you in person or via Zoom to help you establish your Google Business Profile listing.
Should I have a website?
In most cases, yes. A website is your digital storefront. There are four general reasons to have a website:
- to sell products and services
- to provide information
- to increase visibility
- to provide additional customer service
To sell products and services on the Internet, success involves having a great product or service and attracting a targeted market. E-Commerce (selling through a website) is a five-step process:
1) Host the content on the Internet.
2) Market the website and content.
3) Collect and record customer orders.
4) Process payments.
5) Fill and ship customer orders.
Can you help me re-structure my debt?
Yes, we can help. Our advisors are able to review your financials and credit situation to help you develop a strategy to consolidate your debt and manage your cash flow.
Can you help me understand my financial statements?
We would be happy to help you. SBDC advisors have extensive experience analyzing small business financials and they are also certified Profit Mastery instructors.
My business was affected by a flood/fire… can you help me?
The Small Business Administration (SBA) is your best source for resources needed after a natural disaster. If your business is engaged in agriculture, see the resources on the U.S. Department of Agriculture's website. To prepare your business to withstand a natural disaster, see the resources found on business.idaho.gov.
When do I need to collect Idaho sales tax?
You need to collect sales tax when you make your first retail sale in Idaho. Most service businesses are exempt from sales tax with some exceptions. To obtain a sales and use tax permit (also called a resellers permit), you will submit IBRS. If you need only a temporary permit, such as for sales at a trade show, you can print a temporary sales tax permit from the Idaho State Tax Commission's website. A temporary permit is valid for 90 days for one event. In addition to products, sales tax is charged on rented equipment, including golf and bowling shoes and equipment and on admission fees.
I've heard that as a woman, minority, disabled, or veteran owned business I may qualify for certification that will help me get more business. What is this and how do I do it?
Depending on your interest in pursuing federal or state contracting opportunities you may qualify for certification as a disadvantaged business. To find out how to qualify or to learn more about state or federal contracting programs, please register for SBDC consulting or contact Idaho PTAC. Certification is useful only when pursuing federal and state contracting opportunities. For general business purposes, any business that is owned by a woman, disabled person or minority can self-certify by indicating in their marketing that they are a disadvantaged business.
Procurement Technical Assistance Center (PTAC)
What does PTAC stand for? What do they do?
PTAC stands for Procurement Technical Assistance Center. PTAC consultants assist businesses in qualifying to be able to bid on federal and state government contracts (procure government contracts). They recently changed their name to Idaho Apex Accelerator.
What is SBIR?
SBIR stands for Small Business Innovation Research. It is a form of funding offered by 11 federal agencies to help small businesses engaged in innovative reasearch that is in the national interest to gain the funds needed to develop their product or process. The program is competitive and requirements are rigorous. If you think your business may qualify for SBIR funding, talk to a counselor at the Idaho SBDC for details.
Do I need insurance?
Yes. To understand your risks, consult with an insurance agent. The agent can also give you quotes to help you develop accurate cost projections. Typically the types of insurance a small business owner will need to consider are: liability, property, worker’s compensation and, in some cases, bonding. For details see Insurance.
I need data for my business plan. What do I do?
The more data and research you do, the stronger your business plan will be. Your SBDC consultant can help you obtain a variety of information from SBDCnet, IBIS World, and other databases that could be helpful. You will likely need to determine your own projected expenses from suppliers and service providers. We also have planning templates and samples that can be helpful. Once you have a draft plan, we can review it and offer feedback. Contact your nearest SBDC office to schedule an appointment.
How long will it take to develop my business plan and get financing?
The length of time needed to craft a business plan can vary considerably based on the potential size of the business, uniqueness, whether you already have data, and whether financing or outside investment is needed. There is no one right way to write a business plan, so don’t get caught up in trying to make your plan look like someone else’s or hiring someone else to write your plan. You know more about your business than any outsider. Meeting with an SBDC consultant can help you avoid pitfalls in the planning process.
How do I choose a legal name and organizational structure for my business?
Your selection of a business name and structure is very important. They are registered with the Idaho Secretary of State. This process may affect your legal liability, taxes and more, so you may want to consult with your attorney and accountant before choosing a structure. You can research the differences between a sole propriotorship, Limited Liability Company (LLC), partnership, and corporation by checking Legal Structure. Talk first to your SBDC consultant and then to an attorney and a CPA. The higher your personal net worth, the more protection you will need and the business structure is the place to start.
What is in a business plan? Do I need a formal, written one?
A business plan describes your business, identifies your goals and serves as your firm's resume. The business will need a competitive advantage or value proposition to compete. The plan details the products and services you will sell; the customers to whom you will sell them; the production, management, and marketing activities needed to produce your offerings; and the projected profit or loss that will result from your efforts.
The business plan allows you to use the research you completed to draft the plan to make decisions affecting the future of the business. Completing the plan forces you to examine future decisions regarding management, marketing, personnel, and finances in an objective and organized way. It provides a projection of the sources and uses of financing needed for start-up or change up of your business. A cash flow projection is a vital part of the plan for certain types of businesses. The business plan can be a useful tool in securing capital. The plan may become your owner's manual guiding your daily operations and activities.
Business planning is an ongoing activity. Existing businesses, as well as start-up firms, benefit from writing and regularly updating their goals, plans and activities. If you seek funding, you will be required to provide a well researched and written business plan.
Will the SBDC write the business plan for me?
No. The SBDC will assist you in developing and reviewing a business plan. However, it is important that you write your business plan yourself. Writing a business plan forces you to think through issues that you may not have considered otherwise. The SBDC does offer workshops and on-line training courses that will assist you in writing your business plan.
How do I write a business plan?
We recommend using a business plan template. You can find several online including on the SBA website. We still see plenty of plans written with paper and pencil if that is more your style. Describing your business structure, customers and the value you provide them is a good place to start. An SBDC consultant or a SCORE counselor can provide assistance.
What is Business Model Canvas?
The Business Model Canvas is a great visual tool to chart business elements that describe your business’ products and/or services and their value to your customers. A strategic management tool such as the Business Model Canvas can help define and streamline your business.
What is a business feasibility study?
A feasibility study contains facts and projections that outline possible future scenarios for your business and gives an idea of whether your proposal is likely to succeed. It allows a business person or investor to look at probable outcomes before significant money is spent. These studies can be brief or lengthy. They may be about cost of production, pricing, technical prospects, scheduling, or other factors regarding the operation of the business and prospects of success.
Do I need a business plan? If so, why?
A good business plan will increase your chances for success. A high percentage of start-up businesses fail and a plan could help prevent failure. A business plan is the resume for your business. It provides information about your company and its industry, describes a marketing plan, details the operations plan and projects the financial needs of the business. It helps you allocate resources properly and make informed decisions. It provides specific and organized information about your company and how you will repay borrowed money. A thorough, well-written business plan is crucial to obtaining financing. Additionally, it can be used to tell your sales personnel, suppliers and others about your operations and goals.
Why do I need to define my business in detail?
Defining your business in detail will enable you to define your goals and see where you may be spending your time and money. It may also reveal potential untapped markets. A simple or common type of business with little investment might need only a short description. The bigger, more unique, and high investment your business, the greater the need for a more detailed description. Ask yourself, “What business am I really in?" Some owner-managers have gone broke because they never answered that question. One watch shop owner realized that most of his time was spent repairing watches while most of his money was spent selling them. He finally decided he was in the repair business and discontinued the sales operations. His profits improved dramatically.
Can you name a good reference book that can be used in the creation of a business plan for a restaurant?
The National Restaurant Association, the trade industry group for the restaurant industry, has a number of publications you may find useful. You can find more information on these publications on the National Restaurant Association’s website.
Buy/Sell a Business
I'd like to sell my business, what is the first step?
Whether you are considering selling, merging, or closing your business, an SBDC advisor can help you prepare an exit strategy before you actually need it. Where do you want to go with your business and what is your desired exit? If part of the exit plan is to sell your business, do you know what your business will be worth when you sell it? No matter what exit you have envisioned, proper planning will help you make the most of the transition and help to ensure that you realize the real value of your business. If you need assistance, contact the SBDC office nearest you.
Can I get financing to buy an existing business?
Your ability to obtain financing, such as a bank loan, to purchase a business depends on a variety of factors. These include your personal financial situation, the cash flow of the business, available collateral, business history and expectations for the future, and business purchase price. The lender will analyze the business, the borrower, and the structure of the deal to determine whether or not to provide financing. See our video, “Qualifying for a Small Business Loan”
What information should I request from the seller? What if the seller won’t provide any financial information for the business?
When deciding whether to purchase an existing business, you must thoroughly investigate the business and obtain information from the seller, including at least three years of financial statements.
You need accurate financial statements/tax returns for the business in order to make an informed decision about buying it. Should the seller tell you the business has unreported cash sales, beware! Inaccurate reporting to tax agencies is dishonest and illegal. Seller claims of unreported sales should never be counted to determine the cash flow of a business. These claims are unreliable at best.
When making a purchase decision, the buyer should rely on financial information which can be documented (i.e. tax returns, accountant-generated financial reports). Lenders only consider documented financial information and so should you. Be certain to request a Successors’ Liability Clearance Letter from the Idaho State Tax Commission to be certain the seller does not owe back taxes.
I’m buying an existing business that happens to be a franchise. Is there anything special I should know or consider?
You should obtain a copy of the franchise agreement and review it carefully. You should also determine if you’ll be required to pay the entire franchise fee, a transfer fee, royalty fees, or advertising fees. In most cases, the franchise will have to approve the transfer or sale. If you are seeking an SBA loan, it is important to determine if the franchise is one that is eligible for SBA financing. For more information, see the SBA Franchise Directory.
Can you help me value a business that I want to buy/sell?
Business valuation is one of the many ways our SBDC advisors can assist you when you are considering buying a business or franchise or selling a business.
Starting a Business
I want to start a non-profit organization. How do I do that and are there special regulations?
To be classified as a non-profit, approval must be secured from the Internal Revenue Service. First, register your business with the Idaho Secetary of State as a for-profit entity. The process to establish a non-profit can be expensive and time-consuming and many business activities do not qualify. Your attorney can assist with the application process. Information about establishing a non-profit, tax reporting and maintaining non-profit status is found on the IRS website. After receiving IRS approval, the business can then amend their registration with the Idaho Secretary of State to that of a Domestic Non-profit Corporation.
Alternatives: Before establishing a non-profit, you may want to consider other, less expensive, ways to accomplish your goal. See Alternatives to Forming a Charitable Nonprofit for recommendations.
If you decide to move forward in creating a non-profit, you may find it helpful to go through the Business Wizard. You can search for information related to the primary activity of your non-profit and find out if you or your employees may need specific licenses or permits, such as occupational licenses.
Taxes: Non-profits are not exempt from all taxes. Your non-profit may be required to collect or pay state sales or use tax. If so, you will need to secure a sales and use tax permit from the Idaho State Tax Commission. To find a list of exempt organizations, see the Tax Commission’s website.
Recordkeeping: IRS requirements for exempt organizations
- The Idaho Non-profit Center provides information about establishing and maintaining a non-profit in Idaho.
- The Idaho Attorney General publishes the booklet, Service on an Idaho Non-profit Board of Directors, which explains the responsibilities and liability associated with serving on a nonprofit’s board.
- The Association of Fundraising Professionals Idaho chapter provides training and networking opportunities for non-profit staff members who are engaged in fundraising activities.
If your nonprofit is engaged in activities involving children, the elderly, or vulnerable adults, your employees and volunteers will need a background check and to be fingerprinted. For information, see the Idaho State Police website.
Closing/Selling: If you close your non-profit, sell it or convert it to a for-profit entity, you must notify the ID Attorney General. The Idaho Charitable Assets Protection Act governs how you can legally dispose of the assets of the non-profit.
You will also need to notify the IRS and the Idaho State Tax Commission of the closure or conversion of the non-profit and file a final tax report.
I plan to start my business in my home. Are there special requirements I need to know about?
Home-based businesses may need to conform with additional regulations, as well as those associated with your profession or the product or service offered. First, go through the Business Wizard to find requirements related to your profession, product or service. Then, read through the information below to learn about possible additional requirements.
Local Requirements: Call your local city clerk’s office to find out if you need a city business license or another special license or permit. Your business will need to comply with your city, county, and/or homeowner’s or neighborhood association regulations. If you rent your home or apartment or live in a condo, check your lease agreement or covenants.
Legal Requirements: All businesses, including home-based ones, need to register their name and entity type with the Idaho Secretary of State’s office. The exception is sole proprietorships that use the owner's full name in the business name.
- The business must be operated by a full-time resident of the home, not an employee.
- The business must be a secondary use for the home; the primary use must remain that of a residence. The character of the home, interior and exterior, cannot be changed from that of a residence.
- The square footage allowed for business activities varies by community.
- In most communities, a business where customers come and go cannot be operated from a home. If you offer lessons (music, art, etc.), the number of students allowed at any one time may be limited.
- The business must comply with local health, safety, and fire codes and with city and county ordinances. You may be required to conduct all business activities inside the home or an approved accessory structure (garage, shop, etc.). Equipment used in the business may be restricted in size, weight and power to that of normal household appliances.
You must also comply with local regulations concerning:
- exterior signage
- number of employees
- parking (employee and customer); truck and equipment parking
- noise, odor and waste disposal
- dust and vibrations
- air, waste water, or soil pollution
- storage of supplies and materials
- Food Preparation – Idaho’s Cottage Food law allows certain “low risk” foods sold directly to the consumer to be prepared in a home kitchen. This includes most baked goods and other products that don’t require refrigeration. Other foods, including baked goods that will be sold at a commercial establishment, sold on-line or across state lines, or contain imported ingredients must be prepared in a commercial kitchen. The commercial kitchen will be inspected and licensed by your regional health department. Visit the Home-Based Business section of the Food and Drug Administration’s website for more information.
- Child Care – If you care for seven or more children in your home (including your own) and you receive payment for one or more of them, a license is needed from your city clerk’s office and/or from Idaho Department of Health and Welfare. The home will be inspected by the health department and the fire marshal. (Note – some cities’ licensing requirements are more stringent than state requirements, so be sure to check.) Federal and state regulations require everyone applying for or renewing a childcare license to check the Central Registry in every state in which the person lived in the past five years (including Idaho) and to submit proof of the check/checks. Anyone living in a home where an in-home daycare is operated must also submit proof of a check. Central Registries are databases maintained by individual states that contain records of child abuse and neglect investigations. Idaho Department of Health and Welfare maintains the Idaho database. In addition to a Central Registry check, some cities also require an FBI background check.
- Temporary Lodging/Airbnb – Homeowners who rent a room, cabin or another space to the public must register a business name with the Idaho Secretary of State’s office. If the rental is for 30 days or less, sales tax and applicable lodging taxes must be collected and remitted to the Idaho State Tax Commission. Some marketing programs, such as Airbnb and VRBO, will collect taxes for you. For details, see Short-term Rentals. Contact your city clerk's office to learn about local regulations, including local sales and lodging taxes you may need to collect.
- Product Restrictions – Certain products cannot be legally manufactured, grown or raised in a home business. These include fireworks and other combustible items, drugs and drug paraphernalia, poisons, noxious weeds or insects, and sanitary and medical products. Some communities restrict the production of additional items, so check with your city clerk's office for details.
- Service/Sales Restrictions – Services involving risky or illegal activities, adult activities, loud noise, pollution or that create a nuisance for neighbors are restricted in home businesses. The sale of restricted items, such as alcohol, drugs or tobacco, poisonous reptiles or insects cannot occur in a home business.
- Animals – Businesses involving animals (including poultry and birds) are subject to additional regulations and licensing requirements, depending on the type and number of animals and the service provided. A kennel or breeder’s license may be needed; special waste handling and noise abatement procedures may be required, as well as other issues. Contact your city clerk’s office for information.
- On-line Businesses – If you operate an online business, you need to register a business name and entity type with the Idaho Secretary of State’s office. If the business involves sales, a sales tax permit will be needed. If you sell food products online, see the “Food Preparation” information above. Some cities require online businesses to obtain a special home business license.
- Party Plan Businesses – if you sell Scentsy, Pampered Chef, Mary Kay or another product involving home parties or sales events, check with your city clerk’s office to find out if you can hold parties at your home. Some Idaho cities restrict the number of attendees at open houses and similar events held at the dealer’s home (not at a customer’s home).
- Storage Space - If you allow people to store their RV, boat, trailer or another item on your property and you charge a fee, you are a business and need to register with the Idaho Secretary of State and collect appropriate taxes.
- Yard/Garage Sales - If you hold more than two yard or garage sales in a 12 month period, you are a business. You need to register a business name and entity type with the Idaho Secretary of State and obtain a sales tax permit from the Idaho State Tax Commission.
Employees: Your city or county regulates the number of employees a home business may have and the number of vehicles they may park at the home or on a public street. State and federal employment-related posters must be displayed. You must also have workers compensation insurance, pay unemployment insurance taxes, establish a tax withholding account and comply with OSHA safety regulations. For more information on having employees, visit the Employer Issues section of this website.
Signage: Most communities regulate the size and type of signage allowed, if any, in a residential area. Contact your city clerk’s office for local requirements.
Tax Issues: Small business owners, including independent contractors, pay taxes on the profit from their business. They also pay self-employment tax and may need to make quarterly estimated income tax payments. For information, visit the Taxes section of this website and the Small Business and Self-Employed section of the IRS website. For Social Security and Medicare requirements for the self-employed, including independent contractors, visit the Social Security Administration website.
Insurance: All businesses need insurance, regardless of location. Check first with your homeowner’s insurance agent or an agent who writes policies for small businesses. Not all home-based businesses are covered by homeowner’s insurance, particularly if the primary activity, such as house painting, does not occur at the home. If homeowner’s insurance will cover your business, additional coverage may be needed for business equipment, inventory, or a business-owned vehicle.
For information on other types of insurance you may need, such as workers’ compensation or product liability insurance, visit the Insurance section of this website.
Security: Home-based businesses have unique security issues, including allowing strangers into the home, protecting mail, computer security, and personal safety issues, both in and out of the office. Mail, particularly checks and financial information, can be protected by using a mailing address other than your home address, such as a post office box or a mail box at a package shipping center.
Disaster Preparation: Like any business, your home-based one is subject to natural disasters, including fire, floods, earthquakes, structural damage caused by excessive snow, wind, falling trees and more. The U.S. Department of Homeland Security offers Business Toolkits to prepare your business for a natural disaster.
Zoning: Before opening a business in a home, check with your city or county planning and zoning department to be certain you can legally do so. Most communities do not allow retail businesses in an area zoned for residential use, nor do they allow trucks and equipment to be parked at a home or large numbers of people to come and go. If a business is operating in violation of zoning regulations, it could be closed without notice.
Also check with your homeowner’s or condo association or your apartment lease to be certain the covenants allow a business in your home.
Closing Your Home Business: When a business closes, several agencies need to be contacted. For information, visit the Assistance Resources section of this website and look for “Business Closure.”
CAUTION – If you are starting a home business in response to an ad about earning money at home, BEWARE! Work-at-home scams are among the most prevalent. Before sending money, meet with a counselor at your nearest Idaho Small Business Development Center or SCORE office, listed under Assistance Resources, Business Formation and Expansion, and contact the Better Business Bureau in both your community and where the business is located. Also see the information found on the Federal Trade Commission’s (FTC) website.
Financing Your Business
I need a grant to start my business. Who offers them and how do I apply?
Very few grants are available to start or expand a for-profit business unless you have invented a new technology. Most grants are available to non-profits and community organizations to expand their work or to fund special projects and activities.
SBIR/STTR Grants: If you have invented an innovative product that will serve the national interest, you may qualify for an SBIR or an STTR grant to help develop it. Grants are offered by 11 federal agencies through a competitive process. Information is available at SBIR.gov. If you think you may qualify for an SBIR grant, contact your nearest Small Business Development Center or Elevate Idaho for assistance in applying.
NASA Idaho Space Grant Consortium and Idaho NASA Established Program to Stimulate Competitive Research: Research opportunities and student internships with NASA
Grants for Innovation: If you own an existing for-profit business (not a start-up) that is engaged in the development of new processes or technologies or uses natural resources in an innovative way, you may qualify for a research grant. To find grant opportunities, see:
- U.S. Department of Agriculture Rural Business Development Grants in Idaho
- U.S. Department of Energy
- U.S. Department of Justice
- U.S. Department of the Treasury
- National Institute of Health
- Housing and Urban Development (HUD)
- U.S. Department of the Interior Bureau of Land Management
- U.S. Department of the Interior Office of Grants Management
- U.S. Bureau of Reclamation – WaterSMART water and energy grants
Made in America Grants: If you manufacture a product that is made in America and you have problems competing with foreign businesses, you may be eligible for assistance through the Northwest Trade Adjustment Assistance Center.
U.S. Economic Development Administration: Economic development assistance – available to communities and tribes
Idaho Department of Agriculture: financial resources
Idaho Regional Travel Grant Program: – available to chambers, visitors centers, travel councils and other community organizations
FedEx Small Business Grants
Ebay Up & Running Grants: Recipients must have an active Ebay seller's account.
National Association for the Self-Employed micro grants
Wells Fargo Grants: available to community organizations and nonprofits for community development activities
Idaho Power Local Energy Efficiency Funds: grants for energy conservation projects
Idaho State Elks Association: Community Charity
Amber Grants for Women: Monthly grants of $500 are offered. At the end of the year, one of the monthly winners will receive an additional $25,000. See WomensNet for details.
Chobani Community Impact Fund: available to businesses in the Magic Valley to expand economic opportunity and promote entrepreneurship
Micron Gives: Available to non-profits
Non-profits: If you are a non-profit organization, these sites will be helpful:
Other Programs: Special business assistance programs for women, minorities, veterans, the disabled, and others are available, but they are usually for low interest loans, government contracting opportunities, and other types of assistance, not grants.
Partnerships: U.S. Fish & Wildlife Service
Tax Incentives: Your business may qualify for tax incentives (tax credits) for certain business activities, such as creating new jobs in an economically depressed area, hiring the long-term unemployed, or making workplace accommodations for a disabled employee. Incentives are offered at both the state and federal levels. State programs are listed on the Idaho Department of Commerce website. To find federal tax incentives, visit the Internal Revenue Service website. Also visit the Taxes page on this website to find additional resources.
SCOR/U-7 Finance Program: The Small Company Offering Regulations program administered by the Idaho Department of Finance enables established businesses to accept investment funds from qualified Idaho investors without registering with the U.S. Securities and Exchange Commission.
Challenge.gov: Government agencies having a specific need list it on Challenge.gov. Businesses and individuals can submit a solution. The needs regularly change, as do the requirements to submit a proposal.
To learn about funding for which your business may qualify, talk with a counselor at the Boise or Spokane Small Business Administration offices, the Idaho Small Business Development Center, or a SCORE counselor. Contact information for each organization is listed in the Assistance Resources section of this site. Counseling services are free.
What is crowdfunding?
Crowdfunding is a financing option designed to quickly raise funds by securing many small donations from many contributors. Crowdfunding is most successful when a business needs to raise a modest amount of money in a short time. The most common type of crowdfunding involves soliciting donations to start a business or launch a new product. Donors receive a specialty gift for donating. Kickstarter and IndieGoGo are two popular crowdfunding donation websites.
About 30 percent of businesses meet their funding goal. If they don’t, the business receives no money and donated funds are returned to the donors.
The most easily funded products are games, art, books, music, food, fashion and design. Crowdfunding is not often successful for service businesses, website or app development and any other activity not offering a tangible product.
Other types of crowdfunding: Equity funding, debt funding and subscription based funding are additional types of crowdfunding. Equity funding sites, such as EquityNet, sell small amounts of equity in a business to a large network of purchasers. Crowdfunding equity sales are regulated by the Securities and Exchange Commission (SEC).
Debt funding sites, such as Kiva, provide micro loans, usually to individuals in emerging nations. The lender is repaid when the business makes a profit. Patreon is an example of a subscription funding site used by podcasters, musicians and other creative individuals where fans pay to listen to the artists’ work.
Crowdfunding websites may charge a percentage of the amount raised to cover their administrative costs. Credit card processing fees also apply. U.S. residents who raise money through crowdfunding must pay income tax on funds received.
Act for Impact: Bank of the West has teamed with Ulule to provide crowdfunding opportunities for women owned businesses, social impact entrepreneurs, small businesses and nonprofits with a vision for social change.
What loans are available to start a business?
Banks, some credit unions and numerous private organizations offer loans for everything from the purchase of a business to equipment leasing to factoring (a loan against accounts receivables). Family and friends may also lend money to help start your business. The following loan programs are available to many small businesses, though some are available only to established businesses, not start-ups. All require the borrower to have a well researched and written business plan and collateral. To find banks and other loan resources in your area, complete a search of the Resource Wizard on this site.
Small Business Administration Loan Guarantees – The SBA does not lend money. Rather, it guarantees loans offered by participating banks. To qualify, an applicant must meet both the bank’s and the SBA’s requirements.
For information about applying for an SBA loan, talk to your bank or visit SBA Loans.
- CAPLines – Helps established businesses meet short term and cyclical working capital needs
- 7a Loan Program – The most common SBA loan; can be used for several purposes
- Microloan Program – Guarantees loans up to $50,000; restrictions apply
- 504 Loans – available only through Certified Development Companies. Provides fixed-rate, long term financing for the purchase of major fixed assets such as real estate and equipment. To find a Certified Development Company in your area, contact the Idaho SBA office or your local Small Business Development Center. CDCs are located in Hayden Lake, Boise, Twin Falls, Pocatello and Rexburg.
Lender Match, a division of the Small Business Administration, matches businesses seeking a loan with SBA-approved lenders.
GovLoans.gov - find loan programs backed by the U.S. government and other funding options
Idaho Department of Agriculture – Agricultural Development Loan Program
REDiFiT – Low Interest transportation loan program to expand Idaho’s freight shipping industry
Idaho Housing and Finance Association – Collateral Support Program – Contact your banker for information.
MoFi – formerly known as Montana and Idaho CDC, loans are offered to businesses in Montana, Idaho, Wyoming, eastern Oregon and eastern WA that can’t qualify for bank financing. Asset management services are available.
Whole Foods Local Producer Loans – Available to businesses who sell their products to Whole Foods.
Crowdfunding – A method of raising funds via the internet by securing either many small donations from a large number of people or offering a small equity share in a business to many small investors. See the above FAQ about Crowdfunding.
Angel Investors/Venture Capital – See the Venture Capital/Angel Capital FAQ below.
Loan Preparation – Before approaching a lender, be certain you have gathered all the necessary documents, including a well researched and written business plan and personal financial statements for owners. Your lender can tell you everything you need. Also see the SBA website.
To find banks and other lending resources in your area, make a search on the Resource Wizard. To learn about loan programs that may fit your business needs, contact your banker.
I’ve heard about venture capital and angel investors but I am not sure how they work or if my business qualifies for their help.
Finding venture capital or an angel investor may seem like the answer to many small business funding needs, and it may be if you are in the right industry, have a solid business plan, a track record in your industry or a related one, a qualified management team, and you don’t mind giving up equity in your business and having someone watching over your shoulder.
Venture Capital: Most venture capital firms invest several million dollars in the companies they fund and in return expect an ownership share in the company (stock) and a management position within the company or a seat on the board of directors. Most prefer companies in rapidly growing industries, such as technology or bio-technology.
Venture capital funding is a fertile field for scam artists. Before engaging in business, contact the Attorney General's office and the Better Business Bureau in the state and community where the company is located and ask if complaints have been filed against them.
Angel Investors: Angel investors are wealthy individuals or groups that provide less money than venture capital firms, usually to early stage businesses. Like venture capitalists, angel investors usually prefer to invest in rapidly growing small businesses that will provide a high rate of return in a short time. They will expect a seat on the board and/or a management position within the business.
To find a venture capitalist or angel investor, ask your banker, attorney, or accountant for a recommendation to a company specializing in your field and arrange an introduction. (Most VCs and angels don’t like cold calls.)
VCgate is an online venture/angel capital resource directory where those seeking venture capital can find possible investors. To find venture capital and angel investors who specifically invest in Idaho businesses, search the Resource Wizard.
For more information about venture and angel capital funding, visit the Small Business Administration’s website.
I would like to issue securities to increase my businesses’ funding. How do I do that?
Operating A Business
Do Homeowners Who Provide Temporary Lodging Have To Charge Tax?
AirBnB, VRBO and similar websites have made it easy for homeowners to rent a room, cabin or another temporary lodging to the public. However, a homeowner cannot just open their doors without first registering as a business with the Idaho Secretary of State’s office and securing required state and local permits. See short-term rentals on the Idaho State Tax Commission’s website for information on properly establishing a temporary lodging facility. The IRS website contains Federal tax reporting information for temporary rentals. Short term rentals must collect sales tax, lodging tax and more. If a lodger remains more than 30 continuous days in the same room or space, taxes do not apply.
As of January 1, 2018 short-term rental marketplaces (AirBnB, VRBO, etc.) are required to register with the state and collect applicable taxes. If the marketplace fails to register or the property owner doesn’t use a marketplace, the property owner is responsible for collecting and remitting taxes.
Local Option Lodging Taxes - Some cities, such as Sandpoint and Kellogg, impose a local option lodging tax in addition to state lodging taxes. Contact your local city clerk's office to learn about your local requirements.
Limitations - Homeowners may not rent space in an RV, travel trailer or similar structure not designed for permanent habitation, nor can they allow someone to park and live in an RV or travel trailer on their property and collect rent for the space.
Local Requirements - Check with your local city clerk’s office to find out if you need a local business license or permit, a home occupation permit, fire inspection or something more. Some cities impose additional requirements, including such things as proof of adequate parking and proof of an emergency evacuation plan. There may be an annual license fee. Requirements vary by city, including a requirement in some cities that the homeowner be on-site during the time the space is rented.
Storage Space Rental - Homeowners who rent storage space at their home for items such as RVs or boats are considered business owners and must register a business name with the Idaho Secretary of State and collect any applicable taxes.
I own an autobody shop. I understand environmental requirements for businesses like mine have changed.
The EPA has updated the reporting requirements for businesses that use certain paints and solvents, including autobody shops. For assistance in navigating the regulations or to apply for an exemption contact Environmental Solutions.
How do I register a trademark?
Your trademark, also known as a service mark, can be registered in three ways:
State Registration: The Idaho Secretary of State registers trademarks in Idaho. Your trademark must be unique and not similar to one already registered. Be aware that registering your trademark only in Idaho does not provide national protection from its use by a business in another state.
International Registration: Madrid – The International Trademark System
The trademark symbol ™ can be used on written materials that include your unique name or logo (including your website) to indicate that your business claims an ownership right in the use of the symbol or word. You do not need to register your trademark to use the symbol, though it is a good idea to do so if you want to protect the name or symbol from use by others.
If the trademark is registered with the U.S. Patent and Trademark Office, the Registered ® symbol is used. Using the symbol gives public notice that the logo or name is trademarked and cannot be copied without legal consequences.
How do I register to sell to the government or become a preferred vendor?
Federal, state and local government agencies purchase everything from computers and vehicles to cookies and coffee from small businesses. They also contract with small businesses to construct or renovate buildings, build or improve infrastructure (roads, bridges), maintain landscaping, clean buildings and more.
Contracting With Federal Agencies: Businesses must register with System for Award Management (SAM). Once registered, you can peruse requests for bids on government contracts listed in the Contract Opportunities database.
The GSA (General Services Administration) is the Federal government’s primary purchasing agency. Federal “Prime” contractors (major contractors) are required to purchase a percentage of the goods and services they use from small businesses. A list of prime contractors is found in the GSA Subcontracting Directory. Prime contractors list goods and services they are seeking on Sub-Net.
Contracting With a Regional Agency: The US Army Corps of Engineers Walla Walla District provides contracting opportunities for waterways navigation, flood risk management, design, construction, operation and maintenance at public works facilities within the District's boundaries (ID, WA, OR, WY).
Contracting With Idaho Agencies: For information about the State purchasing process, see ID Division of Purchasing. Businesses need to register in order to gain information on current bid solicitations. The Division of Purchasing offers regular training programs to assist businesses in learning how to sell to the State.
Not all state agencies list their contracting opportunities with Idaho Purchasing, instead posting bid requests on their individual agency websites:
- Idaho Transportation Department contractor bidding
- Idaho Division of Public Works construction projects
- Idaho Department of Lands contracting opportunities
- Idaho Department of Environmental Quality vendor opportunities
- Idaho and Federal Bureau of Land Management contracting
Contracting With Local Agencies: Cities and counties list their bid opportunities in the legal section of a local newspaper and/or on their city or county website.
Disadvantaged Businesses: Woman, veteran and minority-owned businesses, collectively known as disadvantaged business enterprises (DBE), may have preference in bidding on certain contracts through the various Federal agencies’ Offices of Small and Disadvantaged Business Utilization. In Idaho, the Idaho Transportation Department handles such contracts.
Minority Owned Businesses: The National Minority Supplier Development Council, Inc. certifies minority-owned businesses.
HUBZones: Businesses located in a federally-designated HUBZone (an economically distressed area within a city or county) have preference when bidding on federal contracting opportunities. Find Idaho HUBZone areas here: HUBZone maps. Businesses must be certified in order to access bid opportunities.
Contracting Assistance: Idaho Apex Accelerator, a division of the Idaho Small Business Development Center, assists businesses in registering to contract with state and federal agencies and in finding appropriate bid opportunities.
I have an out-of-state business and plan to do business in Idaho. How can I find out about Idaho regulations?
What you need to do depends on how long you plan to do business in Idaho and whether you will hire Idaho residents or use employees from out of state. If you plan to engage in business for more than a few days or weeks, you will need to contact:
- The Idaho Secretary of State’s office to find out if you need to register your business in Idaho as a foreign corporation or LLC.
- The Idaho State Tax Commission to learn about taxes you may need to pay, permits you may need, and to establish an employee withholding tax account for your employees who live or work in Idaho. If an employee is paid $1,000 or more for work performed in Idaho, you will need to withhold Idaho income tax.
- The Idaho Industrial Commission to learn about workers compensation insurance requirements.
- The Idaho Department of Labor to establish a state unemployment insurance tax account (for employees who are Idaho residents).
- The city clerk’s office in the city in which your business will be located or working to find out if you need a business license. If your business activities will occur outside city limits, check with the county clerk’s office to find out if you need a county business license.
Also visit the Business Wizard to obtain a customized check-list of agencies from which you may need to obtain licenses or permits, including professional licenses for your employees.
My product is made in the U.S., a rarity today. Do I need to do something to be able to advertise it as U.S. made?
The Federal Trade Commission (FTC) regulates “Made in the U.S.A” advertising. U.S. content must be disclosed on certain products, including textiles, wool, fur and automobiles. Manufacturers and marketers of other products who choose to claim their product is made in the U.S. also need to comply with labeling requirements.
How can I have my product certified as organic or “green?”
The Idaho Department of Agriculture certifies organic farms and food products grown in Idaho, as well as organic livestock production. They also certify organic soil amendments (fertilizer) made in Idaho.
The U. S. Department of Agriculture administers the National Organic Program for production, handling, and labeling of agricultural products, including meat, poultry, seafood, and alcoholic beverages. They also set policies for the import or export of organic products.
I want to sell my food at our farmer’s market but they won’t let me unless I prepare it in a commercial kitchen. What is that and how do I make my home kitchen into a commercial one?
Commercial kitchens are inspected and licensed by your local health department. To find contact information for your local health department, visit the Forms page of this site. Unfortunately, you cannot make your home kitchen into a commercial one. A commercial kitchen must be located in a separate area away from your home kitchen with a separate entrance and locking door and it cannot be used to prepare family meals. It must contain specific appliances, shelving, stainless steel countertops, and special sinks, all of which can be expensive to implement.
Many churches, community centers and senior citizens centers have commercial kitchens and may be willing to rent space to you. Also check with caterers and with restaurants that serve only breakfast and lunch to see if you can rent space in the evening. With some searching, there is a way to make your business possible. The Idaho Department of Health and Welfare’s Food Protection Program website offers additional information.
Idaho's Cottage Food law allows the production of certain “low risk” foods, such as most baked goods, in your home kitchen if you sell them directly to the consumer. If you sell any food product, including baked goods, to a commercial establishment, online, or across state lines, it must be prepared in a commercial kitchen. Foods requiring refrigeration, such as cream pies, must also be prepared in a commercial kitchen. The Idaho Department of Agriculture publishes a booklet, Starting a Craft Food Business in Idaho, that contains much information you may find helpful.
What is TERO? My company wants to bid on a project on the Ft. Hall Reservation but they say we must have a TERO permit.
TERO is an acronym for Tribal Employment Registration Office. To perform work on most reservations your company must employ Native American workers. You can obtain information and the necessary form by contacting the tribal office of any reservation where you plan to work.
The company I am currently working for wants me to give them a W-9. What is it and why do I need to do this?
A form W-9 is a “Request for Taxpayer Identification Number.” When a business pays $600 or more in a calendar year to another business or individual who is not an employee, the business is required to file an information tax return with the IRS. To do so, the business must obtain the correct taxpayer identification number to include on the return.
Examples of businesses that require a W-9 include those that issue 1099s to independent contractors and those that must report real estate transactions, contributions to an IRA, cancellation of debt, payments to a childcare provider and other monetary transactions. See IRS form W-9 information and instructions.
Planning and Zoning closed my business. They said it was not allowed to be located where it was. Can they do that? What recourse do I have?
Most Idaho cities and counties have zoning regulations with which businesses must comply. Before signing a lease or purchase agreement, first check with your city or county planning and zoning commission to be certain you can legally operate your type of business in the area you have chosen. For example, you would not be able to establish a construction business, including a home based one, in an area zoned as residential. As you discovered, If a business is opened in violation of zoning regulations, it can be immediately shut down when a zoning inspector finds it or when someone complains. It may then be difficult to terminate a lease or purchase agreement.
Some businesses, such as churches and day care centers, may be able to secure a conditional use permit to operate in an area not specifically zoned for businesses. Be sure to find out if your business qualifies for a conditional use permit and can meet all the requirements before you open it. If you attempt to operate your business without a permit, it will be closed when the city or county finds you.
I think my business may be subject to environmental regulations. How do I verify that and find out how to comply?
The Idaho Department of Environmental Quality regulates business activities affecting air and water quality and waste management and remediation, including hazardous waste. The DEQ’s Permits page contains a list of required permits for businesses that may generate pollution in the course of operations. For confidential assistance in understanding and complying with regulations, contact Environmental Solutions. A counselor will be happy to guide you through the process.
How Can My Store Accept Food Stamps?
The U.S Department of Agriculture Food and Nutrition Service issues permits to qualified stores, fruit and vegetable stands and other food retailers. To find out if your business qualifies to accept food stamps and to apply, see USDA SNAP Program.
Are contractors required to be licensed in Idaho?
In 2005, the Idaho Legislature passed the Idaho Contractor Registration Act, which requires contractors, remodelers and any business that charges $2,000 or more to a customer for work that improves, changes or demolishes property to be registered. The Act requires registration, not licensure. Registration is with the Idaho Division of Occupational and Professional Licenses. Any business that improves, changes, modifys or demolishes real property needs to register.
Where can I get money for my business?
The answer to this question will vary depending on whether you are starting a business or are already in business and on the following:
- the amount of money needed
- length of time in business
- geographic location
- personal credit rating and financial net worth
- business credit rating, if an existing business
- management ability
- ability to provide collateral and repay the debt
- viability of the business idea
- type of financing needed (debt or equity)
Committing your own funds is often the first financing step for a start-up. It is certainly the best indicator of how serious you are about your business. Risking your own money gives confidence for others to invest in your business.
Next, approach family and friends - those who know you best and want to see you succeed. Show them the benefits available by investing in your business. Let them have an equity stake in your business, become a partner, or if they prefer to lend you the money, write up a contract and pay back the loan with interest, as if you were working with a bank.
The next obvious source is a bank, particularly for an established business. Developing a relationship with a bank and a banker before approaching them for a loan is key. They will help you determine which type of loan is best for you.
Other loan sources include commercial finance companies, venture capital firms (only available to rapidly growing tech companies), angel financing (private investors of a few thousand dollars up to $5 million who are interested in rapidly growing companies), local development companies, and life insurance companies. For information about financing options, see the business.idaho.gov website.
Trade credit, selling stock, seller financing, use of supplier/vendor financing (have a supplier extend 120 day terms instead of the usual thirty while you extend only 30-day terms to your customer), end-user funding (having the ultimate customer finance the research and development of the product), and equipment leasing offer alternatives to borrowing. Leasing, for example, can be an advantage because it does not tie up your cash.
Consider which options are right for you and then work with your banker or an Idaho SBDC consultant to determine the option that is best for you.
How can I obtain a loan?
Securing a business loan can be a daunting process, particularly in this economy. The best way to enhance your "asking" position is to do your homework. Before approaching a lender, get a copy of both your personal and business credit reports and make sure they are accurate. If anything is amiss, correct it with the reporting agency. If there are blemishes (late or missed payments, defaults, etc.) - prepare explanations.
Prepare a detailed written business plan with credible financial and market data. If you are already established in business, be prepared to provide two to three years of financial statements and tax documents. Understand that if you have a poor credit record (personal or business) or cannot demonstrate a personal investment in the business and the ability to repay a loan, you will not be considered a good risk. Instead of applying for a loan now, you may need to work at maintaining good personal and business credit (timely, consistent payment of debt) for at least two years and then reapply.
Your banker will know of several types of loans. One of the most common for small businesses is an SBA loan. The Small Business Administration does not make direct loans to businesses; rather, they guarantee loans. To get an SBA loan, a business owner must first contact a commercial loan officer at a bank. All SBA loan programs, even those for women, veterans, and the handicapped, require the business owner to start with a bank.
The bank evaluates the needs of the business, determines whether the potential borrower is eligible for a loan, helps the borrower fill out application forms, and determines which of the many loan programs is most appropriate for the situation. If the loan needs a guarantee in order to be more attractive to the lender, the package is forwarded to the SBA.
The role of the SBA is limited to guaranteeing some portion of the loan made by the bank to the borrower. This guarantee lowers the risk to the bank, but it doesn't affect the amount of the loan.
Most banks in Idaho are SBA-approved lenders. However, some are more active in making small business loans than others. Start with your own bank to find out if they make small business loans. If not, contact a state or community bank. They are generally more interested in helping small businesses than the large national banks.
If I'm thinking of starting a business, what should I do first?
Before you quit your job or print business cards, it is wise to take stock of personal considerations. Ask yourself:
- Do I have what it takes to be an entrepreneur?
- Am I a risk-taker?
- Do I have a grasp of basic financial and marketing principles?
- Am I resourceful and organized?
- Can I support myself and/or my family financially during the early stages of the venture when cash may be short?
- Am I willing to work 18 hours a day 7 days a week if that is what it takes?
- Will my family and friends be supportive during the start-up process?
- Am I knowledgeable and experienced enough in my chosen field?
If the answer to any of these questions is "no," you may want to focus on addressing the issues before proceeding. If most of your answers are 'yes,' then it is time to lay the groundwork. Get as much information as you can on the feasibility of your idea and on the real experience of starting and managing any business. You can do this by:
- accessing business publications and data from your local library
- taking seminars and workshops
- speaking with or reading the websites of trade or professional groups that represent your chosen industry
- consulting with people who are already in the same or similar line of business (avoid those who may perceive you as a potential competitor)
- seeking advice from professional counselors like those at the Idaho SBDC or your local SCORE office
Also, take the time to read through the information on the business.idaho.gov website, then contact your nearest SCORE Chapter or Idaho SBDC office to arrange for a free consulting session.
What kind of registration and licenses are required to start a business?
Our companion website, Business.idaho.gov, which was created by over 20 Idaho state agencies, makes it easy for business owners to get a grip on the multitude of regulations, taxes, and licenses affecting business operations in Idaho. The site takes the guesswork out of which agency to contact for what. The heart of the site is the Business Wizard. It asks a few questions about your business and then develops a customized checklist of agencies to contact. The checklist includes phone numbers and links to forms and websites.
If you have been in business for awhile and you know what agency has the information you are seeking, just browse through the topic buttons on the home page. Links to downloadable forms and other information are at your fingertips.
Should I have a web page?
Many business owners assume they need a website, but not all businesses need one, depending on your particular situation. There are four general reasons to have a website:
- to sell products and services
- to provide information
- to increase visibility
- to provide additional customer service
First, decide if any of these reasons make sense for your business. To sell products and services on the Internet, success involves:
- having a great product or service
- attracting a targeted market
- selling and satisfying your customers
E-Commerce (selling through a website) is a six step process; all online businesses will go through the first three steps:
- Create the online content.
- Host the content on the Internet.
- Market the website and content.
Businesses conducting online sales will need to complete three additional steps:
- Collect and record customer orders
- Process payments
- Fill and ship customer orders
Before committing valuable cash and precious time pursuing the development of a website, you may want to meet with an SBDC consultant to determine whether your business would benefit from having a website.
What does marketing involve?
Marketing is one of the most important aspects of your business. Without marketing, potential clients can't find you. Marketing consists of four elements, often called the "four P's":
Marketing encompasses much more than just advertising or selling. A major part of marketing involves researching your customers:
- Who are they?
- Where are they located?
- How do you reach them?
- What do they want? (Great product? Great customer service? Follow-up support?)
- What can they afford?
- What do they think?
Your understanding and application of the answers to such questions plays a major role in the success or failure of your business.
For assistance in creating a marketing plan for your business, contact your nearest SBDC or SCORE office.
What is my market potential?
The principles of determining market share and market potential are the same for all businesses. First determine a customer profile (who), your anticipated market area (where) and the geographic size of the market (how many). This is the general market potential. Knowing the number and strength of your competitors (and then estimating the share of business you will take from them) will give you the market potential specific to your enterprise.
How can I find and keep qualified employees?
Two of the greatest challenges for any business are hiring the right people and keeping them. Employees, and more importantly their contributions, are a business's most important asset. So how do you go about finding, selecting and retaining the best people?
Decide What You Want
Before beginning your hiring efforts, know what you want. One way is to list the skills, experience, and other attributes you are looking for in the following categories:
- must have - skills you do not have the time, money or desire to teach but which are absolutely necessary to the job, such as education, occupational license and experience
- should have - sets of skills in which the candidate should have some degree of knowledge or skill
- nice to have - what you'd love to have but can live without
Search in the Right Places
The harder it is for you to find the skills you need, the wider the net you must cast. You may choose from local media, the state's employment center (ID Department of Labor offices), and the Internet. View any employment ad as a marketing tool for your company, making it as appealing as possible. Put a headline on your ad that describes the absolutely best benefit you can offer. Be sure to add your must-have list of skills, experience, and education. To get qualified people without having to weed through a pile of applications, be specific about what you say and very selective about where you place the ad.
Don't underestimate the value of networking. You may choose to ask your best employees if they know someone who would fit well in your organization or use your network in the community to find employees.
Conduct a Thorough Interview
Give the applicant a complete and accurate picture of your business. In today's market, you have to sell both yourself and your company. Through your questions, cover the job's must-haves, should-haves, and nice-to-haves and be sure to obtain a clear picture of where the candidate is in relation to these attributes. Remember, good questions lead to good answers - the more you learn about each applicant's experience and skills, the better prepared you are to make your decision. If you find yourself talking as much or more than the candidate, stop - you only learn about the candidate when you are listening. Don't be afraid to press a candidate for more information - it is then that you may learn important information.
Hire the Right Person
Some tips for choosing who to hire include:
- Go with your gut instinct
- Accomplishments are what really matter
- Attitude counts
- Be objective
The three critical elements in hiring the right person for the job are skills match, company fit, and job match. Be objective in determining which candidates have the best overall fit. In terms of wages, try to be a leader in your market - think about the cost of paying a little more versus the cost of turnover (roughly 25% of salary and benefits).
Hold on to Good Employees
Employee retention is as important as the initial hire. An individual's suitability to a particular job is the single most important factor in job performance and retention. Be sure to provide jobs that fit with the employee's personality and then take the time for a proper orientation. Listen to them and continue to provide training and skills development opportunities. Set clear expectations, show concern for employees, and treat them fairly. Some other low or no-cost employee retention tips include:
- Use an open management style that gives employees a sense of ownership and more control over their destiny.
- After completion of a tough project, give team members some time off or reward them in some other way.
- Be as flexible as possible with work hours, dress, work rules, telecommuting.
- Try to make the work challenging or allow individuals to make an immediate difference in some way.
- Have fun. Throw a pizza party for no particular reason; give away family tickets to an amusement park.
- Assign coaches or mentors to help employees not only with specific jobs, but also in developing their careers.
- Consider offering an equity stake in the company to key hires.
- Make sure your managers and supervisors have the necessary skills to hire and keep good people.
Your business's reputation is a key element in retaining employees and attracting new ones. Make sure you know how your business is perceived in the community and do whatever it takes to make that perception a positive one.
Does the Idaho SBDC charge for its services?
The counseling, management and technical assistance services offered by Idaho SBDC counselors and staff are provided at no charge to the client. Charges may be made to recover client-approved direct costs for items such as printing, postage, data retrieval, etc., related to special projects. Nominal fees are generally charged for training seminars and special events.
How can I protect my customers' and employees' data from theft?
Identity theft, Internet fraud, and security breaches are increasingly common in today's business world. To help your small business manage security and privacy challenges, the Better Business Bureau (BBB) has partnered with nationally-recognized security and privacy experts to create a new toolkit called Cybersecurity Resources to Help Businesses and Consumers. The objective is to demystify the complexities of data security and provide small businesses with a non-technical road map to securing their customer and employee data.
The Idaho SBDC offers a Cyber Security Packet that you may find helpful.
Licenses and Permits
I need a state business license. How do I apply?
Idaho does not have a state business license requirement. Business licenses are issued by cities and many cities do not require them. Please contact the city clerk's office where your business will be located to find out if you need a local license.
How do I apply for a permit to sell alcohol at my restaurant?
What is a vendor’s license and where do I get it?
Businesses engaged in temporary retail sales or solicitation of sales for future delivery, including selling door-to-door or at festivals, events, and trade shows, may need a vendor’s license or a temporary vendor’s license, also called a solicitor’s license. Temporary food cart vendors may also need a license. Licenses are obtained from the City Clerk’s office in the city where you will do business.
If you are engaged in door-to-door sales, you and each of your employees may need a license in every city or county where you work. Each of you will need a background check before the license is issued and you may need to post a bond. Out-of-state applicants have additional requirements. You and each of your employees must wear your license on your clothing in a clearly visible location.
Sales Tax - In addition to a vendor’s license, you will also need an Idaho sales tax permit or a temporary sales tax permit. A permanent permit can be obtained by completing form IBRS. A temporary sales tax permit for one specific event lasting less than 90 days can be printed from the Idaho State Tax Commission’s website.
Consumer protection - If sales are made door-to-door or at a trade show, fair, festival or similar event, they are considered impulse purchases and the seller must conform with federal and Idaho consumer protection laws. Consumers have the right to cancel an order or return an item within three business days. Your cancellation policy and contact information must be clearly communicated in your contract or on your invoice. For details, contact the Idaho Attorney General’s office or visit the Federal Trade Commission’s website.
How do I establish a retirement plan for my employees?
Retirement plans must comply with Federal and state laws and Internal Revenue Service requirements. The U.S. Department of Labor oversees the Employee Benefits Security Administration (EBSA), which sets standards for establishing and maintaining retirement plans. The DOL also administers the Pension Protection Act.
Harassment is a touchy subject. What do I need to know to protect my employees and myself?
On the job harassment takes many forms, none of which should be tolerated. One employee may harass another; a supervisor may harass an employee, group of employees or another supervisor; or a customer may harass one or more of your employees. Harassment may be related to religion, ethnicity, gender, age, disability or another issue. Bullying is a form of harassment and should not be tolerated.
Every business with employees should have a written harassment policy that is clearly communicated to employees, both as a deterrent to harassment and to inform employees of their rights if they are harassed. It is particularly important to have a written sexual harassment policy because sexual harassment on the job violates federal civil rights laws. Having a written policy your employees know about may offer some protection if you are sued.
Click here for training videos and additional information about preventing or investigating sexual harassment.
For more information about employer responsibilities in preventing harassment, see “Employee Handbooks” on the Helpful Links page of this website.
I had to fire an employee who used drugs on and off the job. I don’t want this to happen again. Where can I get help?
With the legalization of cannabis use in several states, employee use of illegal or controlled substances has become an increasing problem. According to the U.S. Department of Labor, 75 percent of illegal drug users are employed, and 3.1 percent say they have used illegal drugs before or during work hours. The American Insurance Association reports that prescription drug abuse is the fastest growing drug problem in the U.S. In addition, 79 percent of the nation’s heavy alcohol users are employed, and 13 percent say they have consumed alcohol during the workday. Fourteen percent of heavy drinkers (those who consume 5 or more drinks each day) are employed full or part-time. Over 10 percent of workers who die on the job test positive for alcohol or drugs. Substance abuse on the job costs employers approximately $74 billion each year in lost productivity, increased absenteeism and accidents and injuries that lead to workers compensation claims.
To help combat substance abuse both on and off the job, the Substance Abuse and Mental Health Services Administration (SAMHSA), a division of the U.S. Department of Health and Human Services, maintains a resource center to help employers address these issues and to assist in creating substance abuse employment policies. Additional information can be found on the National Safety Council’s website.
Ninety percent of large corporations have drug-free workplace programs but less than 10 percent of small and medium sized businesses have one, making them prime targets for addicted employees. DrugFree Idaho helps Idaho businesses establish a drug-free workplace program. Having a program in place may reduce workers comp insurance premiums by up to 5%, which may be enough to offset the costs of implementing the program. Today, with the legalization of medical marijuana use in some states and recreational use in others, it is important to involve your attorney when drafting a drug-free workplace policy.
Can I advertise on this site or put a link on this site?
Any state or federal government agency or non-profit organization may be represented on business.idaho.gov if they license or regulate business activities or offer business-related services. Local agencies, such as city and county clerks’ offices, are not represented individually in the text pages, because there are so many and their requirements vary. Their information is included in the Business Wizard. There is no cost to be included. This is not a commercial site, so no advertising is accepted.
If your organization fits the above criteria and you want your agency or organization to be listed on the site, send us an email, then we will review your site for possible inclusion. Please do not place a link on your site and then expect us to provide a reciprocal link.
What is a Health Insurance Identification Number and how do I get one?
If your business offers health insurance to employees, and you must if you have 50 employees or more, you will need a National Standard Employer Identification number to report claims electronically. For information, see National Provider Identifier Standard.
How do I obtain a UPC code for the product I plan to sell?
See GS1 US BarCodes and eCom, formerly known as Universal Packaging Codes.
I am interested in joining a service club where I can help the community and promote my business. Can you recommend one?
Many excellent service clubs exist in even the smallest communities. Among them are Rotary, Kiwanis, Optimist, Lions Clubs, Elks and more. Most focus on specific types of community and/or international assistance. If you have a passion for certain activities, such as those involving youth, education, the environment, recreation or international development, there may be a group for you.
If promoting your business is your primary purpose in seeking a service club, you may be better served by joining your local chamber of commerce or a leads group. Chambers are listed in the Resource Wizard on this site. To find leads groups in your area that may be accepting new members, make an internet search or secure a referral from a business associate.