Despite being one of the most highly saturated business areas in the world, New York City continues to be a popular choice for people looking to launch careers and businesses. In fact, MarketWatch reports that the big apple has the largest urban economy in the world, as it is home to many healthcare, technology, securities, media, and tourism-related enterprises.
However, starting a business in New York City isn’t as easy as the numbers might make you think. Many business owners do the best they can to survive in the competitive New York market, and those who don’t think things through often fold within 6 months of opening. With that being said, we’ve listed down 4 things you should consider before starting your business in the city that never sleeps.
A Business Plan That Covers It All
Before you start your business, make sure that you have an extensive plan that covers all your bases. At its core, your business plan should detail your finances, how you plan on going about operations, and the products and services that you plan on offering. Furthermore, your business plan should also include everything that’s related to marketing, advertising, and management. By making sure that you have a foolproof plan, you can help secure the success of your business.
Competition in the Market
With more than 2 million small businesses in New York City, competition is very fierce in the big apple. New York City’s market isn’t an easy one to penetrate, considering almost everything can be found in the city. The population is so diverse that you can find many businesses offering obscure products and restaurants that specialize in far-flung cuisines. That’s why you have to strongly consider what makes your business stand out before your opening day. Other than that, you also have to make sure that you have a robust marketing strategy in order to entice the adventurous tastes of New York residents.
The Kind of Business Structure You Need
It’s important to choose your business structure carefully, as this will dictate the paperwork you’ll need to file, how you’ll deal with taxes, how liable you are for any damages, and also the very nature of your business entity. In New York, businesses usually default to a DBA, or “Doing Business As”, structure. However, this business structure does not protect you from any liabilities. That’s why it’s recommended to incorporate as an LLC, or a limited liability company since your business will then be recognized as a separate entity — protecting your personal assets in case your business runs into legal troubles. Plus, registering an LLC in New York is a lot simpler than setting up a corporation. After naming your LLC and appointing a registered agent, you need only file your certificate of organization and operating agreement, before applying for an employee ID number. Do note, however, that you’ll need to publish a public note of formation in two newspapers within 120 days of registering.
Incentives and Tax Benefits
Here’s the thing: New York has absurdly high taxes. But despite this, there are plenty of tax benefits and incentives that make the journey a little easier for small business owners. For one, there’s the START-UP NY program, which permits new businesses to operate tax-free if they’re close to or located in select universities in the state. There’s also the New Markets Tax Credit program, which gives incentives to real estate developers and businesses so they can create more jobs and help with developing the community in low-income neighborhoods.