Texas is the second-best place to do business according to Forbes List. Everything is indeed bigger in Texas, Oil, Energy, Biotech, and of course Information Tech. All these factors contribute to why Texas is the best place to start your business.
The question however is ” Do you know how to start a business in Texas”? Not to worry if you do not. This article will be teaching you how.
We will be looking at the various steps involved in starting a business in Texas, and also why you should start a business in Texas.
This piece will also highlight the trending jobs in Texas and the biggest industries in Texas.
According to the Texas small business profile, in February 2019, the state of Texas’s unemployment rate was 3.8%, down from 4.1% in February 2018. This was equal to the February 2019 national unemployment rate of 3.8%.
Meanwhile, its economy In the third quarter of 2018, grew at an annual rate of 3.7%, which was faster than the overall US growth rate of 3.4%.
These stats go to show how lucrative businesses in Texas have been. So what are you waiting for?
Introduction
Owning a business of your own is no doubt an achievement, and of course, it comes with an amazing filling of self-fulfillment.
However, it’s lot always easy – but i assure you that it’s easier in Texas.
If wishes were enough, we all would probably be doing one business or the other, but it isn’t. Starting a business as matter of fact requires lots of deliberations and planning for it to come to fruition.
The environment you wish to site your business is another factor that must be put into consideration before starting your business. You need to understand the business laws and regulations in such places to know if your business idea would thrive.
This is why we are going to discuss how to start a business in Texas, because we know Texas to be a very business-friendly state. Before we get started, however, let’s look at some;
Facts About Texas
Texas is a state in the South Central region of the United States. It’s the second-largest U.S state by both area and population with a population of about 29 million people.
The Alamo is located in San Antonio. It is where Texas defenders fell to Mexican General Santa Anna and the phrase Remember the Alamo originated. The Alamo is considered the cradle of Texas liberty and the state’s most popular historic site.
The state of Texas shares borders with the states of Louisiana to the east, Arkansas to the Northeast, Oklahoma to the north, and New Mexico to the west.
Texas is nicknamed the Lone Star State and is known for its abundance of Tacos.
Texas was once a country of its own before joining the union in 1845.
The phrase “GONE TO TEXAS” or its shortened version GTT was adopted by people leaving a brief note for their loved ones before skipping to Texas.
In Texas, Vietnamese is the third most spoken language – this after English and Spanish. Texas also has a sizeable amount of its citizens speaking German.
Though Texas is one of the biggest states in America, it’s home to the “smallest Prada store in the world”
Texas is very popular with its barbecue, but what most people don’t know is that its barbecue varies from one region to the other.
More About Texas
Whole Foods grocery stores first began business in Austin Texas, with its door first opened in 1980.
Frozen Margaritas!! Tasty right? Well, it was invented in Texas by a man named Mariano Martinez. This was in 1971.
The Second largest Canyon, which is a stunning sight to see, is in Texas – Palo Duro Canyon.
The state of Texas is home to three of the top 10 most populated US cities.
The Texas capitol is taller than the US capitol almost by 15 feet. And the state produces more wool than any other state in the US.
The term “maverick” comes from a Texan. A 19th century Texas rancher named Samuel Maverick is the origin of the word, who gained notoriety for refusing to brand his cattle.
Finally, Texas is home to the largest bat colony Bracken Cave.
Why You Should Do Business In Texas
Below are some of the reasons you should do business in Texas
Population
As one of the most populous states in the U.S, Texas provides a viable market environment for any business to thrive. It has an abundance of talent.
Friendly Business Environment
Additionally, the state of Texas is very accommodating for businesses to thrive, and this can be seen in its low business licensing fees, its lack of red tape, and an abundance of relatively cheap real estate.
Texas is home to over a dozen companies on the Fortune 100 “Best Companies to Work for” list. Small businesses make up over 45% of all jobs in The Lone Star State.
The state offers entrepreneurs a business-friendly environment, minimal tax burden, reasonable cost of living, robust infrastructure, and many other business-enabling factors.
Innovation
In addition, the state of Texas is open to innovation. It has been host to South by Southwest (SXSW) for a number of years now and continues to celebrate the changing landscape of tech and media.
Good Transport System
More than 380 airport calls Texas home with dozens of 100 fortune companies located here.
Receptive Of Small Businesses..
The state of Texas has a consistently friendly climate for small businesses.
Tax Benefits
Another reason why you should do business in Texas is that starting a business in Texas has significant tax benefits.
The Tax Foundation’s 2019 State Business Tax Climate Index revealed that Texas does not have an individual income tax or corporate income tax. This, therefore, makes Texas an attractive location for a startup, along with a thriving economy.
Cost Of Starting a Business In Texas
The cost of starting a business in Texas is actually dependent all a lot of factors like;
This said, for an LLC you will pay $300 to the Secretary of State to file for Certificate of Formation for a Limited Liability Company (Form 205) with the Secretary of State.
Industries In Texas
Texas is home to a lot of oil companies, this is why it’s the largest oil-producing state in the U.S.
It is also lots of companies making waves in Advanced tech and manufacturing.
It also has a robust Aerospace, aviation, and defense industry.
Texas is also known for its energy generation and consumption both per capita and as a whole. As a matter of fact, Texas is the largest energy producer in the country, before Florida.
It is also the national leader in wind power generation, comprising about 28% of national wind-powered electrical production in 2019.
Texas is home to lots of Biotech companies and is known to be host to lots of Information and computer tech companies.
Trending Business Ideas In Texas
How To Start A Business In Texas
Below are steps you’d need to take to get your business up and running in Texas.
#1. Determination
While this is not really an official requirement, your determination will go a long way in helping you start your business.
You need to be disciplined and stay true to your goals of starting the business.
#2. Choose A Business Idea
It takes much more than sheer determination to get a business up and running in Texas.
If you’re really convinced, then you need a business idea that can work in Texas. We highlighted some of the trending business ideas in Texas above.
If you have one already picked out, or the ones we talked about doesn’t fit into your plans, then get one that does and get started.
#3. Write Your Business Plan
This should be one of the things you’ve to put in place for your business. Don’t be among those that’d only write a business plan because they need funding.
Your business plan is a guide of what you expect to do in your business and how to go about achieving it. Therefore, you should have one.
It brings your business ideas into something tangible that can be followed to achieve your aims of starting the business in the first place.
If you can’t write one yourself, get someone to help you or learn how to by reading how to start a business plan.
#4. Select A Business Entity
Now you have your business idea and plan sorted, the next thing to do will be to get a business entity.
This simply means choosing the structure of your business.
Are you going to be a sole proprietor, or would you be needing partner(s) in the business, or is going to be an LLC or a corporation kind of business.
Determining the structure you want your business to have will enable you to know how you’d go about your funding and a lot more.
#5. Choose A Business Model
This is very different from a business entity. It is an outline of how a company intends to make money with its product and customer base in a specific market.
Business models are important as they help you to identify what you’d be selling, whom you are selling to, and where and how to see those you’d be selling to.
There are numerous business models, and the important thing is that you choose one that best suits your business.
#6. Pick and Register Your Business Name
This no doubts something every intending business owner must do.
If your business is a Sole Proprietorship business, your name can be your business name. You can also get an assumed name via the DBA certificate.
To get an assumed name that isn’t chosen already, you need to;
Do Some Research
You’d be surprised to find that name you think is the right fit for your business has already been chosen by some stranger miles away. The only way to be sure however is to check out your name online.
While at it, also do a;
Trademark Search
Once a name has been trademarked, what it means is that no one is allowed to use it for business or any other purpose, as it now belongs to the person(s) that trademarked it.
To be sure, sift through the trademarks already registered with the U.S. Patent and Trademark Office.
The database can show you which names have already been registered along with the classification of each one.
Finally;
Check Texas’s Business Name Database
If you have done your due diligence by following the other steps above, now you must check the Texas Department of State: Division of Corporation’s database.
This will be your final step to ensure you don’t pick a name similar to any other business in Texas.
While at it, I advise you put some real thought into it because it might be difficult changing your name in the middle of company progress.
#7. Request For an EIN
Employee identification is to a business what the Social Security Number is to a woman. It is used to track your business dealings, establish business credit, open business checking accounts, and file tax withholding if you have employees.
To Apply For the EIN with the IRS, click the button below.
As you try to keep up with your federal taxes using the EIN, you must also keep with your state tax responsibilities.
In Texas, the Comptroller of Public Accounts collects various state taxes and imposes and collects franchise taxes, though most small businesses are exempt.
Also, businesses that own fixed assets are assigned Business inventory taxes. Therefore, get the best inventory system you can so you know how much exactly you can pay as tax.
#8. Acquire Business Licenses and Permits
Depending on the type of business you wish to venture into, you might need to acquire certain Business licenses and Permits to be able to operate.
To be on the safe side, check out the Texas Department of Licensing and Regulation to see if your specific profession qualifies.
If you’re not sure how to go about it, or if your business needs certain permits and licenses to operate, contact your local county or city government.
#9. Check Your Business Employer Requirements
In Texas, you must meet certain regulatory requirements to avoid getting into trouble. Some of these regulations are specific to your type of business, which includes having employees.
You must satisfy labor, safety, and tax obligations. You must also satisfy mandates like the Americans with Disabilities Act, Equal Employment, and safety, wage, and labor requirements.
To be sure, get a tax or business attorney.
This said, there are other economic hurdles you must meet up and they include;
#10. Sign Up For Business Banking
As a new business owner, I highly recommend that you separate your personal account from your business account.
This will help you keep proper tabs on your business finance and know if you’re making progress or not.
To get started, sign up for a business checking account. While you might be concerned about heavy fees that come with Checking accounts, there are many free business accounts out there – find them!
Before settling for any bank, check the proximity of the bank your place of business, and also how often you plan to make transactions and how much a balance you can carry month to month.
Related: 13 Best BANKS In Texas
Final Thoughts
There are a lot of factors in the state of Texas that makes starting a business seamless. From the low taxes and business fees to the absence of red tape, and relatively affordable infrastructure – Taxes is a start-up haven.
Therefore, if you have a business and Texas is your choice location to start it up, you’re in for the best start-up experience because the barrier is very low.
Sure the weather might be a little too hot during the summer, but that’s a small price to pay, and again that makes your winter experience not as bad as you might have it in other states.
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