how to start a Business in napa County
An informational guide
Are you overwhelmed with all that is needed to set up your business? You know you need professional advice, but there is no money in your budget? The good news is, we can help!
The Solano-Napa SBDC offers no-cost, one-on-one, confidential advising by experienced business owners who can walk you through the process and help you evaluate your options, so you avoid making decisions you will regret.
To get started, we suggest taking NorCal SBDC’s no-cost Starting Your Business Part 1 and Part 2 which covers this information in-depth and is available online.
We also offer no-cost live and recorded workshops on a wide variety of business topics for all industries including retail, restaurants/food production, manufacturing, personal services, technology, the creative arts and more.
10 Steps for Starting your Business
1. WRITE A BUSINESS PLAN
Regardless of where you’re located, a Business Plan is the foundation for a successful launch! A great resource is the SBA Build Your Business Plan creator tool. A popular alternative is an Executive Summary, examples of which can be found at www.thebalance.com/business-plan-executivesummary-example-2948007.
To increase your chance of success, explore and evaluate your business and personal goals. Use this analysis to build a comprehensive and well-thought-out business plan. Your business plan has a number of uses. Committing yourself to writing a business plan is a methodical way to mentally construct your business and serves as a valuable tool in loan applications.
2. SECURE FUNDING
It takes money to make money and all businesses need capital to start and grow. Typically this capital will come from savings, home equity, or friends and family. You should have at least enough capital investment for start-up costs and at least six months of operations.
The next most frequent source of funding is a business loan. If you are considering a business loan, we recommend contacting the SBDC to help you prepare projections, a business plan, and help you understand how to qualify for a business loan. The U.S. Small Business Administration (SBA) guarantees small business loans through local lenders. These loans are particularly helpful for minorities, persons with low-income, and persons with questionable credit.
Lenders will want you to be successful, as a loan is, in many senses, an investment in you and your business. Lenders will be very clear about their requirements and timelines.
3. DETERMINE YOUR BUSINESS STRUCTURE
There are several forms of legal entities of businesses, each with their own advantages and disadvantages. It is best to thoroughly research the structures and settle on the one that best fits your needs and goals. No classification is any better than another, they are only different. You can learn more about the various business structures at the IRS page for self-employed businesses.
All new businesses that are not a sole proprietorship must file formation documents with the Secretary of State. The required forms can be found on the California Secretary of State website. Any contracts between owners of a partnership should be drawn up before beginning business.
Information about the tax implications of each business structure can be found at the SBA’s wepbage for paying taxes for small businesses.
4. FILE YOUR BUSINESS NAME
A Fictitious Business Name (FBN) Statement is a public record that the identities the people doing business under the FBN. Banks often insist on a copy of the FBN Statement before opening a commercial account to satisfy them that John Smith has a right to deposit checks written to “Smith and Company Catering.”
A licensed business name is necessary if the company name differs from the owner’s name. A filing of a Fictitious Business Name Statement is required before opening a business checking account in the title of the business.
You are required to file a Fictitious Business Name if the business name you have chosen is different from your own legal name. For example, if your legal name is John Jones and you have chosen a name that includes your last name (“John Jones House Repair” or “Jones House Repair”), then you do not need to file.
The Fictitious Business Name Statement is filed with the county government. For a small fee, a notice will run in the local newspaper announcing the creation of your fictitious business name. Be sure to check the availability of your desired business name. California Business Name Availability, www.sos.ca.gov/businessprograms/business-entities, provides information on how to check to make sure a business name does not already exist and may be used.
For information on filing a fictitious business name in Napa County, visit the Napa County Clerk’s Office. The cost for registering a single fictitious business name with one registrant is $50. Each additional business name and/or registrant names is $7 per DBA and/or registrant.
After filing, your fictitious name must be published in local print media – once a week for four consecutive weeks in a local adjudicated newspaper. The clerk’s office will provide a list of adjudicated local newspapers at the time the statement is filed.
5. CHECK ZONING IN THE CITY/COUNTY LOCATION
It is imperative to determine zoning regulations and requirements prior to signing any lease or contract. The intended location of your business must have the proper zoning for your planned use of the site. If you will be operating the business out of your home you must follow the requirements for home occupants, if any, in your municipality. The Napa County Planning Division website, has a plethora of information concerning permits and zoning. Visit the site to find zoning maps, permit forms, and information about the various planning commissions and programs shaping Napa County. Here are the city planning sites:
- American Canyon, Phone: 707-647-4336
- Calistoga, Phone: 707-942-2827
- City of Napa, Phone: 707-257-9530
- St. Helena, Phone: 707-968-2659
- Town of Yountville, Phone: 707-944-8851
6. OBTAIN A BUSINESS LICENSE
Business licenses are required before your business can begin. In order to operate your business, you must comply city, state, and federal rules and regulations. www.calgold.ca.gov offers a search tool for discovering which licenses are necessary for your business based on your industry and location.
Business licenses can typically be purchased at City Hall and the price ranges from $40 and up, depending on the number of persons you intend to employ. Businesses located in, or conducting a portion of their business within any of the cities or unincorporated area of Napa County should contact that city regarding the requirements for a business license.
- American Canyon, Phone: 707-647-4354
- Calistoga, Phone: 866-240-3665
- City of Napa, Phone: 707-257-9508
- St. Helena, Phone: 707-967-2792
- Town of Yountville, Phone: 707-944-8851
7. PREPARE TO HIRE EMPLOYEES, IF NEEDED
Your Federal Tax ID number, otherwise known as the Employer Identification Number (EIN), is comparable to a Social Security number for your business. You can obtain an EIN by filling out Form SS-4. Everything you need to know about Employer ID Numbers (EIN) can be found at www.irs.gov/businesses/small-businesses-selfemployed/do-you-need-an-ein.
The Employment Development Department (EDD) is a department within the California State Government that promotes California businesses as well as aids employees and employers. They release yearly editions of their handbook, “California Employer’s Guide,” which covers broad topics concerning how to succeed in business. The most recent edition can be found at www.edd.ca.gov/pdf_pub_ctr/de44.pdf. All employers in California are required to electronically submit employment tax returns, wage reports, and payroll tax deposits to the Employment Development Department.
It is a legal obligation to invest in Workers Comp Insurance prior to the hiring of any employees. This can be done with your insurance agent or broker, but California State also has established a State Fund. This fund is the largest supplier of Workers Comp Insurance in the state and grants many opportunities to low income start-ups. An important distinction when hiring employees, especially for tax purposes, is classifying their employment status appropriately. The IRS has a helpful publication for understanding the different classifications and rights of certain employees, this can be found at www.irs.gov/publications/p15a/ar02.html. Along with many other resources, the SBDC offers this simple, easy to use checklist to hiring and maintaining employees, www.norcalsbdc.org/sites/default/files/C hecklist%20for%20Hiring%20Employees.pdf.
8. OBTAIN A SELLER’S PERMIT AND RESALE NUMBER
A California Seller’s Permit application is required for all business selling or leasing tangible property (including anything you did not prepare such as sodas, etc.). Retailers, wholesalers, and manufacturers must obtain seller’s permits from the California State Board of Equalization online or in person. Visitwww.cdtfa.ca.gov/services.
The California State Board of Equalization (BOE) collects California State sales tax and use taxes. BOE also monitors special taxation items such as fuel, alcohol, and tobacco. More information may be found at www.boe.ca.gov or by calling 800-400-7115
9. ENSURE YOU HAVE ANY SPECIAL LICENSES AND PERMITS REQUIRED
The licenses and permits necessary to run your business legally are determined by the type of business you wish to establish. The CalGOLD database, www.calgold.ca.gov, provides detailed information on business permits, licenses, and registration requirements from all levels of government. Here you can also find a description of the requirements, contact information for the supervising agency, and a direct link to the agencies’ website. Their catalog of information will assist you in finding the appropriate permitting information for your business, as well as direct you to links and contact information for the agencies that administer and issue business permits, licenses, and registration requirements from all levels of government.
The California Department of Consumer Affairs lists more than 200 regulated occupations and professional services. Their website, www.dca.ca.gov, also offers valuable licensing information.
10. ASSESS YOUR NEEDS FOR BUSINESS INSURANCE
Businesses are major investments; sometimes a life’s work can go into opening a business. Unfortunately, the truth is that it’s not uncommon for businesses to be robbed, vandalized, or otherwise destroyed. It’s incredibly important for all business owners to invest in Liability and Property Insurance, to protect your building, inventory, and equipment. Many insurance companies offer Business Insurance, and most will work with you to create a policy that best fits your needs.
Contact your insurance agent and shop around before settling on a policy.
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