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Georgia is home to more than 1.2 million small businesses and is a vibrant, dynamic marketplace that offers many benefits to new businesses.
“Georgia has been named the best state for business by Area Development magazine for an unprecedented 10 years in a row,” said Chris Clark, president and CEO of the Georgia Chamber of Commerce. “Our predictable tax environment, robust infrastructure network and extensive entrepreneurial community make Georgia a great place to start and grow a business.”
That being said, there are some complications for entrepreneurs looking to start a business locally. This step-by-step guide will walk you through the steps to start a business in Georgia.
How to Start a Business in Georgia
Choose a business idea Name your business Create a business plan Choose a business structure Obtain an EIN File articles of incorporation, if relevant Obtain business licenses and permits Consider insurance options Understand financial considerations Advertise your business
1. Choose a business idea
Choosing a viable business idea isn't just about deciding what products to sell or services to offer. There are several other things to consider before settling on a Georgia small business idea.
Who are your customers?
The best business ideas start with a clear understanding of who you're selling to. You can develop this understanding by conducting a competitive analysis of other companies in your market, analyzing markets where similar products or services are sold, researching potential customers, and studying industry trends.
What is the expected profitability?
Determine the profitability of your idea by considering your price, distribution opportunities, business model, and the costs of building your business and manufacturing your product. What is your break-even point? How many products or services do you need to sell to at least cover your costs?
2. Name your business
Naming your Georgia business entity is one of the most important decisions you'll make as an entrepreneur. It impacts branding, marketing, and even customer retention. Here are some things to consider when choosing a business name:
Is it unique in Georgia? All business names in Georgia must be unique. You can do a search using the Georgia Secretary of State's Business Entity Search feature. Is the domain name available? You should check to see if a marketable domain name is available that is a good match for your chosen business name. Is it easy to remember? Generally, a good business name is one that effectively communicates the entity's functions in a catchy and memorable way and reflects the business's mission. Does it contain the required suffix? If you are forming an LLC in Georgia, your company name must contain “Limited Liability Company,” “Limited Company,” or its abbreviation (LLC, LLC, LC, or LC). If you do not want to operate publicly under this name, you can apply for a trading name (DBA) under which to operate. Do I need to use a DBA? If you apply for a DBA for your business in Georgia, you must register with the Clerk of Superior Court in the county in which your business is located. You must publish a copy of your business name at least once a week for two consecutive weeks in a local newspaper used by the county sheriff's office for legal advertising.
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3. Create a business plan
A comprehensive business plan is an essential part of any business. A good business plan will include the following sections:
4. Choose a business structure
Your business structure will determine how your company is taxed, how easily you can secure investment, and many other factors.
The types of business structures available in Georgia are:
Georgia offers ample resources for all types of businesses.
“Georgia boasts an extensive network of support for businesses of all sizes. Initiatives such as the Small Business Development Center at the University of Georgia and the Advanced Technology Development Center at Georgia Tech are just a few examples of programs that serve as resources for entrepreneurs looking to start, grow and develop their businesses,” said Daniella Perry, vice president of the Georgia Chamber of Commerce Foundation.
“Of course, our local chambers of commerce are advocates for the small business community in every part of the state, providing tailored benefits for businesses in their local communities. Reaching out to your local chamber is a great way to find out which programs will best fit your needs.”
Here are some factors to consider when choosing the right business structure for your venture:
Sole proprietorship
A sole proprietorship is the default setting for any business that isn't formally incorporated or has a partnership agreement. That means it's owned and operated by one person. Instead of being taxed once on corporate income and once on personal income, as is the case with partnerships and most LLCs, the owner's personal income is taxed once.
Limited liability company
Limited liability companies are a popular choice of business structure. They offer many of the benefits of operating a simpler business entity like a sole proprietorship or partnership, plus many of the legal protections given to larger corporations. The limited personal liability offered by a limited liability company ensures that the owners' personal assets have a level of protection against creditors and legal judgments.
C Corporation
C corporations offer the same degree of personal asset protection, but they are generally more difficult to set up and maintain. Because the business is incorporated as a completely separate entity from the business owner, there is more paperwork involved. Still, it is easier to raise capital for a corporation by issuing stock.
S Corporation
An S corporation is similar to a C corporation but provides a legal business structure with pass-through tax status, meaning the corporation does not pay corporate taxes and instead passes all profits, losses, deductions and credits through to its shareholders, who pay their own taxes.
To learn what business taxes you may be charged depending on the structure of your Georgia business, visit the Georgia Department of Taxation website.
5. Get an EIN
Once you've determined your business structure in Georgia, you'll need to apply for an Employer Identification Number (EIN), which is a nine-digit number that the IRS assigns to your new organization for tax purposes. It functions similarly to an individual's Social Security number.
An EIN identifies your business to Georgia tax authorities, and having an EIN not only makes it easier to file taxes at both the federal and state levels, but it also allows you to secure a line of credit, a business credit card, and hire employees.
6. File Articles of Incorporation if relevant
If you are incorporating, you will need to file Articles of Incorporation with the Secretary of State’s office to register your company. The Articles of Incorporation must contain at least the following:
Company name or valid company name reservation number; Name and address of the person applying on behalf of the company; A valid email address for the company; Mailing address of the company's principal office; Name and address of the registered agent (must have an address in Georgia); Name and address of each incorporator; Number of authorized shares to be issued, if any, initially
Within 90 days of incorporation, you must file your first annual registration listing the names of your three principal officers and pay a $50 fee if you are a for-profit business.
7. Obtain a business license
Georgia businesses require a general business license issued by the city or county in which they operate. Businesses that engage in certain types of business, such as selling alcohol, firearms, or tobacco, may require additional licenses or permits. To find out which agency regulates type-specific business licenses in the county or city where you form your Georgia LLC, contact the Georgia Chamber of Commerce or use the Georgia Municipalities Association's handy search tool.
8. Consider your insurance options
Business insurance helps protect your Georgia business and assets in the event of an unexpected loss, and the Georgia Department of Insurance and Safety Fire Protection Division provides resources to help you determine what your business needs.
The two types of insurance required for businesses in Georgia are workers’ compensation insurance if the business employs three or more employees, and commercial auto insurance for all vehicles used in connection with the business.
Other types of business insurance that can help you in Georgia include:
Liability Insurance. Liability insurance covers your business against any legal action resulting from an accident, injury, or negligence. It is usually required as part of a commercial lease. Professional Liability Insurance. Professional liability insurance protects manufacturers, wholesalers, distributors, and retailers from liability related to unsafe products and services. Cyber Liability Insurance. Cyber liability insurance protects your business from costs related to data breaches and cyberattack damage. Umbrella Insurance. This type of insurance helps cover unexpected expenses that exceed the insurance limits of other insurance plans.
9. Understand financial considerations
In addition to purchasing insurance, you will likely need other investments to set up your business in Georgia. This can include rent for a brick-and-mortar store, costs associated with a professionally designed website, advertising, equipment, and e-commerce software. You may need to hire lawyers, accountants, and other professionals.
📖 Read more: 9 startup funding options and how to get them
10. Market your business
A solid marketing strategy for Georgia small businesses includes several key elements.
Market research. Market research is necessary to gain a better understanding of your company's target customers. Advertising and promotion. Get the word out about your products through paid advertising. You can do this yourself or hire an agency to do it for you. Public relations. You can use public relations to increase awareness organically by identifying and building relationships with media outlets. New business and customer retention. Build genuine relationships with customers that keep them coming back. Satisfied customers spread the word to their friends, family, and colleagues through word-of-mouth marketing, which increases foot traffic to your store.
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Starting a Business in Georgia
Following these steps will lay the foundation for building a successful business in Georgia's growing market. But before you start your business in the Peach State, carefully consider whether your business goals align with what the state has to offer. Research the state's demographics, business laws, and infrastructure to ensure your venture will fit seamlessly into the state's ecosystem and benefit from the thriving business community that already exists.
*This post is for informational purposes only. You are responsible for verifying and using this information appropriately. Requirements are frequently updated, so be sure to do your own research and consult with legal, tax, and business professionals as needed. Businesses outside of Georgia have different procedures and requirements. To sell products using the Shopify platform, you must comply with the laws of your business' and your customers' jurisdictions, the Shopify Terms of Service, the Shopify Acceptable Use Policy, and other applicable policies.