According to the U.S. Small Business Administration Office of Advocacy, as of September 2009 there were 29.6 million small businesses in the United States. While owning a small business can be a fun, exciting venture, it also comes with many responsibilities. Small-business owners wear many hats. Understanding these roles and responsibilities can help make your job easier.
Before you start a small business, you need to apply for an Employer Identification Number, or EIN, which is a federal tax number the Internal Revenue Service uses to identify your business. You also need to apply for state and local taxes. Once your business is established, you need to pay federal and state taxes. Your tax rate will vary depending on your industry and state and local tax laws, so check with your local tax office to understand how much you should pay.
Another important responsibility for small-business owners is hiring and managing employees. If you will have employees helping you, you’ll be responsible for recruiting, hiring, firing and retaining employees. Managing employees can be a challenge though. According to the U.S. Small Business Administration, a company employee handbook is one of the most important communication tools between your company and employees. It should include non-disclosure agreements and conflict of interest statements, anti-discrimination policies, compensation information, work schedules, standards of conduct, general employment information, safety and security, benefits and leave information.
Before starting a small business, you’ll have to conduct market research to find out who your customers are and how to best target them. Once you conduct the necessary research, marketing your business will be an ongoing responsibility. You may need to write marketing copy, visit prospective customers and ensure current customers are happy. If you don’t have experience creating marketing materials, it is best to hire a professional graphic designer and copywriter to help you out.
Keeping track of finances is another responsibility for small-business owners. Hire an accountant to help you manage your finances. If you don’t have an accountant, you’ll need to prepare your own tax forms each year. Other financial responsibilities include preparing and keeping track of financial statements such as balance sheets and income statements, paying suppliers and vendors for inventory and services rendered and paying employees.
Even if you understand the laws and regulations associated with your industry, it helps to have legal counsel on your team. However, you still need to be a part of all legal matters pertaining to the business as the company owner. Legal responsibilities include preparing contracts and other documents, understanding and communicating employment laws to employees and dealing with legal disputes.