Basics of Opening a Business – DSP 287

Graham and Ashkahn take creative license in this episode to talk about the basics of what everyone should know before starting a brick and mortar business.

They want to help others not make the same mistakes they did. This includes everything from getting a legal entity and hiring bookkeepers to making sure you have the correct labor law posters displayed and follow proper hiring practices.

ADP Client Services (Including Labor Posters and FAQs for Small Businesses)

Department of Labor Workplace Posters

Material Safety Data Sheets (MSDS) Directory

OSHA Safety Committee Requirements by State 

Listen to Just the Audio

Transcription of this episode… (in case you prefer reading)

Graham: Alright. Welcome everybody.

Ashkahn: This is Ashkahn.

Graham: I am Graham.

Ashkahn: And this is the daily solutions podcast.

Graham: Kind of breaking format there.

Ashkahn: No.

Graham: It’s not like we don’t usually announce.

Ashkahn: Sometimes we gotta get that in there.

Graham: what are spooky solutions?

Ashkahn: maybe they’re listening to an economics podcast and they didn’t realize it

Graham: We have a really good question today. In from the audience. This might be one of my favorites. So today’s question is in quotation marks, “info on business, dash it’s okay if you fun of this question.”

Ashkahn: This good.

Graham: Well first of all calling it a question is pretty generous because there’s not a single question mark in there. Quotation marks do not a question mark make. Also you’re missing “make fun of this”, the word “make” is absent from the question as well.

Ashkahn: Yeah we’ll take care of it. We’ll make fun of this plenty for you.

Graham: But thanks for permission. That helped out a lot and just choosing to even address this topic, but yeah I think we can give you info on business.

Ashkahn: Yeah we have lots of info on business.

Graham: Ashkahn what do you got on business?

Ashkahn: Well lets see. I’m thinking we were gonna need to interpret this in a way that makes this make any sense at all to other human beings. So I’m gonna go ahead and choose. I’m gonna choose to interpret this.

Graham: I think info is short for information.

Ashkahn: Okay. That was not I was gonna– I always thought it was gonna be infographics. And now we’re gonna be trying to describe those to people through this podcast. Here is the question I think we should answer.

Graham: What are some of your favorite movies?

Ashkahn: Can you talk about just some information about the basics of opening a business?

Graham: Question mark.

Ashkahn: Question mark. You know that’s what I think this person is really deep inside of. I think this is what they’re asking because that’s a good question if you’re out there listening, person who sent this. That is how you ask a question because you know when we opened our business.

Graham: That’s an okay question.

Ashkahn: When we opened our business I kinda do wish someone had just been like listen here’s the things every business has to do and don’t mess this up because we did, we messed them up. We didn’t know we were supposed to have a bookkeeper, like receipts in a garbage bag wouldn’t just sort themselves. Those are not things that were immediately evident to us, so I think it might be nice to go through just a couple quick ones, quick bullet points.

Graham: I see the foundational.

Ashkahn: Yeah.

Graham: Okay yeah sure.

Ashkahn: Not necessarily super float related, but just “hey you’re gonna open your float center. Just made sure you got this list crossed off.”

Graham: Okay, form of business.

Ashkahn: You have a legal entity.

Graham: Yep.

Ashkahn: And really do that before you’re spending money.

Graham: Ideally.

Ashkahn: Yeah open a bank account for the business. The less you mix this stuff up with your personal life the better.

Graham: The more legal.

Ashkahn: Yeah the more legal it’s all gonna be, the less liable you’ll be.

Graham: Yeah both for sure.

Ashkahn: And again easier it’ll be for all your paperwork going forward so that’s a really good thing to think about at the beginning. Don’t just start spending money randomly and then be like “oh I’ll just turn this all into something later”. It’s nice to get that stuff set up to begin with.

Graham: And along those lines I mean if you don’t form a business you probably already are a business then. You’re called a sole proprietor or a partnership if you have partners and basically you are the business so there’s no differentiation between your personal assets and business assets. So when we say “form of business entity”, usually it’s for this idea of the corporate veil that protects what you own from what your businesses are responsible for. So if someone sues your business for $5 million because they hit their head coming out of the tank or something like that, then your house and your car isn’t part of that whole day no matter what happens to your business. So that’s the idea business protection and then like Ashkahn is also saying getting a bank account so you can actually keep your finances separate and keep track of what’s going on. And I guess you know even before that, even before forming a business. I kinda jumped the gun a little bit, get a CPA or an accountant and a lawyer, like a small business lawyer to help you in that process of formation because even though there’s cool sites online like Legalzoom and you can read a lot about what goes into forming and what to be careful of.

Every single jurisdiction is different and your state is different than those places where they were written most certainly and getting someone who’s used to not only your state, but your county and your city to draft up documents that are going to protect you into the future is so worth the money that you’re spending now. So get professionals on board to give you advice before you even go about forming.

Ashkahn: And you’re gonna need them anyway, so might as well get them.

Graham: Yeah get them while you’re young.

Ashkahn: And yeah like a bookkeeper is also a nice one like what I was saying. It’s just hard when you’re doing all this other stuff opening your business, also sorting all your receipts and doing the quick books and all that nonsense. So having that stuff done early and having a bookkeeper be like here’s how I want you to start giving me receipts and tracking this and tracking that is not only gonna make sure you have a really clean set of finances from the beginning, it’s also gonna save you money because at some point you’re gonna have to get a bookkeeper and the longer you’ve gone without one the more you’re gonna have to pay that person to just–

Graham: Get you back

Ashkahn: Yeah.

Graham: Fix everything

Ashkahn: Fix everything wrong. Undo what you just did to yourself. So you might as well get them from the beginning and just kind of set it up right and get that thing going.

Graham: Yeah, yeah for sure. So I mean it’s kinda funny because a lot of the info on business is us telling you to get info on business from other people who are skilled in this area you know. I guess similarly to kind of all of that basic foundational stuff is making sure that you have approval from anyone who you need approval from. You know in the case of float senders it’s going to be

Ashkahn: Your parents.

Graham: Your spouse probably, children. No but the city, you know when you move into a new space you’re going to in addition to needing to be a business and needing your business permits you’re going to need permits for any kind of construction work that you’re going to do and you’re gonna have to run that by a bunch of different city departments usually in one kind of go, but everything from department of transportation to the environmental department to just the straight building and construction department. Again sometimes that’ll happen just in one pass. Health department obviously another big one to go and talk to. So you know these people are not people you’re hiring necessarily in the same sense you’re hiring lawyers, but it is still just these people who are professionals in what you’re trying to do who you need to go through in order to start up your business.

Ashkahn: Also getting your basic kind of online business presence set up I think is a nice thing to do really early, getting your business email account setup.

Graham: Get your Myspace page.

Ashkahn: Yeah you know it’s just nice. There’s still every once in a while I come across something from that we started an account we started many, many years ago that’s still has Graham’s personal email on it or something. It just takes some work to have to go undo all that, “oh that’s just my cellphone number on that thing”. Getting a couple of those basic communication pieces set up the way that you want them as early as possible so that you can start using that information on all the forms and accounts and stuff that you’re gonna have to start making is a nice way of saving yourself some future headache.

Graham: Yeah, yeah it’s good advice. And yeah early branding. I really like getting a Google voice number or something like that that people can call into so they’re not just calling your personal cell phone and that information is all over the place. Yeah all really good stuff.

Ashkahn: On the marketing side, it’s never too early to start a mailing list and just start collecting emails from people who are interested in what you’re doing.

Graham: Yeah I mean certainly like as far as things that you can do immediately. There’s a lot in just even that category of awareness and stuff like that. Info on– sorry I’m just going back to the question again. Info on business.

Ashkahn: “Info on business.”

Graham: is what we’re supposed to be giving here.

Ashkahn: You’re gonna have to do taxes.

Graham: Yeah so the government wants their take.

Ashkahn: Keep that in mind. With business stuff you’re supposed to be doing quarterly here in the U.S. you’re supposed to be doing quarterly estimates for your taxes.

Graham: Yep so once you start they’re expecting you three months later or maybe even sooner to be sending money into the IRS so if you’re not doing that go talk to your accountant bookkeeper again and make sure that they’re instructing you on how to do it. Make sure that you know what your insurance covers.

Ashkahn: Yeah.

Graham: Getting insurance for business interruption, for slip and fall, for property is great, but then when things come up it’s amazing the amount of events that the insurance companies have no interest in actually reimbursing for so as weird as it sounds.

Ashkahn: It’s like were you wearing a jacket during that. Oh so sorry jacket clause.

Graham: Yeah jacket clause, no earthquake coverage during jacket season. Yeah that’s it. But yeah business interruption, we had our entire business interrupted by huge amounts of construction going beyond the street directly outside of us for months when we couldn’t run floats and we got no insurance kicking in because none of the services were interrupted so they didn’t knick a water main, so theoretically we could still get water and electricity to our building so we didn’t get any money from insurance, which is crazy. But yeah these are all those things where it’s lessons from the field running a business that they really should have a class that they train you in beforehand to be like “hey watch out!”

Ashkahn: Yeah my other one is HR stuff.

Graham: Yeah when you’re hiring someone.

Ashkahn: Yeah so there’s certain posters you legally have to put up like OSHA posters and posters about minimum wage in your area and stuff like that and often there’s really easy ways of getting those posters for free and putting them up, ADP or many payroll services give them to you or

Graham: You can just order them

Ashkahn: Bureau of Labor Industry has free posters, but you know stuff like that you need to post up. Make sure when you’re hiring people you’re having them fill out the correct paperwork and there’s certain amount of time you have to keep it on file. There’s certain amount of privacy that you have to keep where you keep your files. There’s certain procedures for even how to interview people. It’s nice to just get a little bit of your head around kind of how HR law works when you’re starting to hire your first person or have people coming in to help you or hiring independent contractors for over a certain amount that makes you have to send them a tax form. There’s all these little things that you’re really not gonna know about if you never opened a business before.

Graham: Yeah I mean the amount of guaranteed time off you have to give people. There’s all sorts of crazy laws that are in effect that you don’t even know about. I promise you you don’t know about them. Safety sheets, like any chemical that you’re using in your shop including just something like Windex or Comet to wipe down the counter. You should have all of the chemical information in MSDS Safety sheets on hand. Things like that are not immediately obvious either.

Ashkahn: Yeah I think above 15 people or so, I keep forgetting the number, but there’s a point where OSHA wants you to having a safety committee. These weird things and I’m like wow how are people supposed to know about this without taking a course.

Graham: They gotta listen to our podcast.

Ashkahn: Yeah so you’re welcome everybody.

Graham: Yeah I mean that was just a brain dump. Really this is an episode of us just being like “what did we mess up? We should tell people not to do what we did.”

Ashkahn: Yeah all of these are coming out of deep, hard, personal experiences that we have.

Graham: So don’t be stupid like we were. Yeah honestly a lot of this stuff is pretty understandable or what I’m trying to say. It’s intuitive.

Ashkahn: It’s obvious once you know it.

Graham: If you stop to think about it and anytime when you’re like “oh am I allowed to use this chemical in this space?”, like there’s actually probably rules around what you have to do if you’re using that chemical or “you’re like I’m just allowed to hire people? That seems crazy.” It’s no, no. There’s tons of regulations around how you hire people. Just cause you can do it doesn’t mean that our government will stop you from messing it up and coming back after you.

Ashkahn: There you go, good luck.

Graham: Good luck. There’s a lot out there.

Ashkahn: I’d probably just wouldn’t do it.

Graham: In fact I purposely didn’t include two of the most important things just to see if you can find them.

Ashkahn: Yeah so you gotta figure out some stuff yourself. We can’t do everything for you.

Graham: Can’t hold your hand this entire time.

Ashkahn: Great, well thanks for that really, really I’m gonna use your quotes here, “question”, good “question” that you sent in.

Graham: Yeah thanks for it being okay if we fun of it.

Ashkahn: If you guys are out there wanna send in your own questions that would be better than this, which really shouldn’t be hard, almost anything, you could just slam your fist into a keyboard and probably send us a better question than this then go to floattanksolutions.com/podcast.

Graham: Savage.

Ashkahn: They really shouldn’t have given us license here.

Graham: They shouldn’t have given us permission is the problem here.

Ashkahn: Anyway go to our website.

Graham: /podcast. Our website slash podcast and you send us stuff.

Ashkahn: We’ll be nicer maybe unless your question is as stupid as this one then we won’t be.

Graham: Bye everyone.

Latest Blog Posts