What Every Small Business Owner Needs to Know About

Business Licenses

Business License

• When it comes to knowing whether your business needs a license, the simple answer is it depends.

Guidelines

• Here are 3 general guidelines:– If you manage or plan on managing

hazardous materials, you probably need a business license

– If you serve or plan on serving alcohol, you probably need a business license

– If you are in a profession (e.g. a lawyer), you probably need a license

Business License

• Professions, hazardous material, and alcohol are the 3 types of businesses that usually need a license just about anywhere in the United States.  – But what if you don’t fit into the above 3

categories?

Business License

• If you don’t fit into any of the above 3 categories, you still are not in the clear.  – Though, you are much less likely to need a

business license if your small business doesn’t fall into one of the three categories listed above.

Finding Out If You Need A Small Business License

• #1 - Visit the website of your local state or city government’s business office to see if there is any information on the website.

Finding Out If You Need A Small Business License

• #2 - Even if you found good information on the government’s website, call and ask your local state or city government’s business office if you need a license.  – Ask them to send you an email confirming

that you do not need a business license.

Finding Out If You Need A Small Business License

• #3 - Once done with the business office, go to your state’s regulatory agency (usually called the department of regulatory agencies or DORA).  – Ask someone at the regulatory agency if you

need a professional license for your business.  – Again, have them confirm in writing that you do

not need one.

Finding Out If You Need A Small Business License

• #4 - Once both these government offices/agencies have confirmed in writing that you do not need a license, you can do one last thing.  – Go to a competitors business, and ask the

competitor if they have a license.  • You can be forthcoming in the interview or you could

pretend to be a potential customer doing your best to find a reputable business. 

• Do not skip the first two steps.  – Your competitors can lie.  – Do not rely only on their word.

Business License

• After a few hours on the phone and internet, you should have the means of proving, even in court, that you do not need a business license

Why You Should Care About A Small Business License

• While it may seem like a wild goose chase to track done the information and confirmations about getting a small business license, you should take the time to do it.  – If you avoid doing this step now, you could find out in

6 months to a couple years that you needed a license to operate your business. 

– The government or regulatory body in charge of your industry could levy a hefty fine against you or your new business. 

• Why waste the time to create a small business to have it go bankrupt a few years after opening your doors?

Links

• This Blog Post• Solo Small Business