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STEPS FOLLOWED IN ESTABLISHING A HOME FURNISHING UNIT/ DESIGN STUDIO

By:SHASHIKANT SHANKER TD- VIITH ROLL NO- 21

Business means doing own work by employing your personal capital. There are many types of businesses and one of them is retail business. In this business, sale and purchase takes place from a fixed location . in this, purchase happens in the limited quantity. It is good for a person, who is having a limited capital to invest. Retail is one of India's fastest-growing economic sectors because the working population is increasing as is the buying power of the people. Starting a retail business requires a lot of initial research and hard work.

Steps for starting a retail business

Choose a business legal structure You must do this before anything else, as it affects how all further business will be conducted. Will you be as a sole proprietor, partner or corporation? Each type is distinct when it comes to taxes and other dealings with the government, as well as funding and any legal issues. You can change your organizational structure later on, but it is costly and time-consuming. The type of business structure you choose should be determined by the following three factors: liability, taxation and record-keeping. The following gives a basic idea of the most common forms of business structure: A sole proprietorship is the most common form of business organization. It's easy to form and offers complete managerial control to the owner. However, the owner is also personally liable for all financial obligations of the business. A partnership involves two or more people who agree to share in the profits or losses of a business. A primary advantage is that the partnership does not bear the tax burden of profits or the benefit of losses-profits or losses are "passed through" to partners to report on their individual income tax returns. A primary disadvantage is liability-each partner is personally liable for the financial obligations of the business.

A corporation is a legal entity that is created to conduct business. The corporation becomes an entity-separate from those who founded it-that handles the responsibilities of the organization. Like a person, the corporation can be taxed and can be held legally liable for its actions. The corporation can also make a profit. The key benefit of corporate status is the avoidance of personal liability. The primary disadvantage is the cost to form a corporation and the extensive record-keeping that's required. While double taxation is sometimes mentioned as a drawback to incorporation, the S corporation (or Subchapter corporation, a popular variation of the regular (Corporation) avoids this situation by allowing income or losses to be passed through on individual tax returns, similar to a partnership. A hybrid form of partnership, the limited liability company (LLC), is gaining in popularity because it allows owners to take advantage of the benefits of both the corporation and partnership forms of business. The advantages of this business format are that profits and losses can be passed through to owners without taxation of the business itself while owners are shielded from personal liability.

Select a name for your business Although this may sound simple, coming up with a catchy name that is easy for customers to remember and also describes the product or service you will sell is not always an easy task. Further, if you plan to operate a website, good domain names are getting hard to find. Pick the perfect name for your retail business. Some entrepreneurs have had the perfect name in mind since they were young. Others may take some time deciding. Do not choose your name haphazardly. A name tells a great deal About a business and is a very real part of its identity. Consider all the words that describe the product you are selling. Consider different phrases and terminology associated with your business. Think about what you are selling and to whom you are selling specifically.

Apply for an Employer Identification Number Apply for your tax identification number (or EIN: Employer Identification Number). The federal government uses this number to identify a business. You must have this number before conducting any business. It is required for any bank accounts or to apply for credit. Once you have a name for your business, you can apply for the EIN. Begin obtaining all your permits. Inform your local city government office about what type of business you will be opening. The city representative will be able to tell you what type of permits you need. Each state is different. Even towns and cities' requirements vary. Retain the services of a business attorney and an accountant with whom you will regularly confer.

Registration Requirements:

No: 1

Procedure Obtain director identification number (DIN) online from the Ministry of Corporate Affairs portal (National) Obtain digital signature certificate online from private agency authorized by the Ministry of Corporate Affairs (National) Reserve the company name online with the Registrar of Companies (ROC) (National) Stamp the company documents at the State Treasury (State) or authorized bank (Private)

3 4

5 Get the Certificate of Incorporation from the Registrar of Companies, Ministry of Corporate Affairs (National) 6 Make a seal (Private)

7* Obtain a Permanent Account Number (PAN) from an authorized franchise or agent appointed by the National Securities Depository Ltd. (NSDL) or the Unit Trust of India (UTI) Investors Services Ltd., as outsourced by the Income Tax Department (National) 8* Obtain a Tax Account Number (TAN) for income taxes deducted at source from the Assessing Office in the Mumbai Income Tax Department

9* 10* 11* 12*

Register with the Office of Inspector, Shops, and Establishment Act (State/Municipal) Register for Value-Added Tax (VAT) at the Commercial Tax Office (State) Register for Profession Tax at the Profession Tax Office (State) Register with Employees Provident Fund Organization (National)

13* Register for medical insurance at the regional office of the Employees State Insurance Corporation (National)

Register the Company's Name Reserve the company's name with the Registrar of Companies. You will have to provide the documents with a registration fee to get the certificate of incorporation that legally approves the name of your business.

Hire a Chartered Accountant The role of a chartered accountant is critical in the start-up process. They have the knowledge required to navigate the government's red tape and move the process along faster. If you are planning to handle the paperwork yourself, it could take up to 90 days or more to get started with the business.

Decide what products/services to sell To dream up a product idea and then attempt to find a customer base for that product is not only backwards thinking, it may spell financial doom. The correct way to approach a new business is to find an area of consumer need and become the company to supply the solution. It is also important to keep in mind that entrepreneurs who love the type of work they are involved in are much more likely to succeed. The best scenario, then, is to find a niche market wherein you will be doing the things you naturally love to do. Decide what you will be selling. Consider these questions when deciding what to put on your shelves. Is it a marketable product or category of products? Do people in your area have a need for it? Can you find a way to fill this need profitably? If you can answer "Yes" to all these questions, you have found what you will be selling.

Write a business plan Write a business plan. Important for many reasons, a business plan is an integral part of the start-up process. This plan is also a must if you will be calling on the assistance of a lender. Banks, investors and venture capitalists will all want a look at your business plan before loaning you any money. It also functions as a time line for the progression of your business. Your business plan outlines your goals for the future of your business and how you plan to achieve them. Refer to it often for guidance.

Learn the laws surrounding your business What city, county or state business licenses or permits will you need to obtain before starting your retail business? You will need to contact each agency individually to acquire this information. Some entrepreneurs choose to hire and accountant or attorney at this point to ensure that everything is in order before opening.

Choose a location for your business The location of your retail business can many times mean the difference between failure and success, so it is essential that you do your homework. Some factors to consider are state sale taxes, city regulations and economic incentives, commute, image, visibility, traffic/accessibility, type of space required (office, warehouse, store front, etc.), cost, convenience and zoning. Find the perfect location. Your retail store's location can make or break its success. Consider how much space you need for storage, sales and administrative functions, and whether your merchandise requires special storage. Before you make your final decision, check out other businesses in the area. Do not set up shop too near a similar business, unless you are in a very high-traffic area. Usually, you need a location where your business will be the only one of its kind. Consider parking options as well. If you expect to have many customers at once, ensure you have ample parking space.

Establish your business policies The best time to establish policies and procedures is before you open the doors to your new retail business. Anticipating problems and developing solutions ahead of time, as well as defining normal day-today policy will reduce confusion and emphasize your professionalism.

Market your business early Create an advertising plan and begin promoting your business well before you open. Let people know you are coming! Brainstorm ideas and take advice from various marketing resources and leaders. Stock your shelves. To sell retail, you will have to buy wholesale. Finding wholesalers of the products you want to sell takes a little work. Attend trade shows for local wholesalers and search online for wholesalers in your state. Look in the phone book and check your local library for resources. Check out retailers that sell similar products and ask about their wholesalers. Hire your employees. Run an ad in the employment section of your local paper and put a "Help Wanted" sign in the window. Take your time hiring your employees. You will need to hire people who are friendly and have some experience in retail sales jobs in the past. Take a close look at employee applications and resumes. Call past employers and listed references. Conduct background checks, drug screenings and criminal records checks. Open for business. Schedule a grand opening so your customers will become familiar with your store and the merchandise you carry. Adhere closely to your business plan, including the marketing strategy laid out therein, for the best chances of success.