How to Legally Get Started as a Small Business or Brand
You've dreamed of starting your own business, you know your craft, but the thought of running a legit, amplified business seems absolutely overwhelming. I get it. That was me back when I started in 2008 when I designed and launched my event photography and stationary graphic design company - kreatid photography & design. Yep, that’s how I started - as a stationary/event company! With my Nikon D40 DSLR set to auto and my Epsom large format printer I was ready for the world. I photographed life events and anyone who would stand in front of my lens in the evenings and weekends as a way to express my creativity while juggling a part-time administrative job that left me feeling less than inspired all while trying to be a good wife and mom to our six and eight year old kids. For me, the sacrificed sleep as I poured over legal jargon, creative education classes, YouTube (waaay before YouTube became the beast of a search engine it is today), and the good old school of Google were worth it to me. Within three years, I stepped away from my administrative job, my kids were more self-sufficient and my business crossed over into a six figure full-time wedding photography and graphic design business.
And now here we are. Maybe you found this post via your own Google/Pinterest search. Let me be one of the first to say, “You can freaking do this!” I did and I’m genuinely excited to walk you through the first essential steps in getting started as a legit business, from choosing the right business structure (what even is the difference between LLC and sole prop?!) to understanding taxes and licenses. Whether you’re a creative looking to launch your small business or brand or someone eager to be their own boss, this post can be tailored to you.
1. LLC vs. Sole Proprietorship?! Choosing the Right Business Structure
When starting my photography/graphic design business, one of the first decisions I needed to make was choosing between an LLC (Limited Liability Company) and a Sole Proprietorship and both options sounded like a new foreign language. Let me break it down for you, each structure has its pros and cons, and your choice will significantly impact your business's branding, legal responsibilities, and taxes.
LLC (Limited Liability Company)
An LLC is a popular choice for small businesses and brands because it offers liability protection. This means that your personal assets (like your home or savings) are protected if your business or brand faces legal issues or debts. Additionally, an LLC adds a level of professionalism to your brand, which can be appealing to clients. The downside? An LLC typically costs more to set up and maintain, with state filing fees and quarterly/annual reports.
Sole Proprietorship
On the other hand, a Sole Proprietorship is the simplest and most affordable structure to set up. You and the business/brand are one and the same, which means you report business income and expenses on your personal tax return. While this structure is easier to manage, it does not offer liability protection, putting your personal assets at risk if something goes wrong. However, if you’re just starting and want to keep things simple, this might be a good choice for you.
In short, if you’re serious about growing your small business or brand and protecting your assets, consider an LLC. But if you’re looking to start small with minimal upfront costs, a Sole Proprietorship might be the way to go for you.
2. Navigating Taxes: What You Need to Know
Understanding taxes is crucial when running a small business or brand. Whether you choose an LLC or a Sole Proprietorship, you’ll need to stay on top of your tax obligations to avoid penalties and keep your business financially healthy.
Self-Employment Taxes
As a photographer running your own business, you’ll be responsible for paying self-employment taxes, which cover Social Security and Medicare. This is in addition to your federal and state income taxes. It’s essential to set aside a portion of your income to cover these taxes quarterly to avoid a large bill at the end of the year.
Deductions
The good news is that there are numerous tax deductions available for small business owners. These can include expenses related to your equipment, travel, office space, and even some marketing costs. Keeping detailed records of all your expenses will make tax time much easier and can significantly reduce your tax liability.
Sales Tax
In Arizona, where I currently call home, photographers are required to collect sales tax on tangible goods, such as prints or albums, and in some cases, digital files. Make sure you’re familiar with the sales tax requirements in your city and register for a sales tax license with your state’s Department of Revenue.
Understanding and managing your taxes might seem daunting at first, but with a little research and possibly the help of a tax professional, you can confidently handle this aspect of your business.
3. Proper Licenses: Getting Legal
Before you start booking clients, it’s important to ensure that your small business or brand is legally compliant in the city you live. In my city, I needed to obtain a few key licenses and permits.
Business License
First and foremost, you’ll need to apply for a business license through your local city or town. This license is required for all businesses operating within town limits, and it’s a relatively simple process. You can apply online (I did here), and the cost will depend on the type of business you’re running.
Sales Tax License
As mentioned earlier, if you’re selling any tangible goods, you’ll need to obtain a sales tax license from your state’s Department of Revenue. This license allows you to collect and remit sales tax on your products.
Home Occupation Permit
If you plan to operate your small business or brand from your home, which many of us do, you might need a Home Occupation Permit. This permit ensures that your home-based business complies with local zoning regulations and doesn’t negatively impact your neighborhood.
By securing the proper licenses and permits, you’ll not only be operating legally but also positioning your business as a trustworthy and professional brand in the eyes of potential clients.
4. Branding Your Business: Stand Out
Now that you’ve tackled the legal and financial aspects of starting your small business or brand, it’s time to focus on branding. In a creative field like photography, where I got my start, your brand is everything - it’s how you communicate your style, values, and the unique experience you offer your clients.
Define Your Niche
First, think about what makes your photography unique. Do you specialize in weddings, family portraits, newborns, or maybe high school senior photos like I did? Defining your niche will help you attract the right clients and set you apart from the competition.
Create a Visual Identity
Your brand’s visual identity should reflect your creative style. This includes your logo, website design, and even the way you present your portfolio. Consistency is key, so ensure that all your branding materials—from business cards to social media profiles—are cohesive and professional. And guess what, you now have a friend in the business that does just this - check out my services page and let’s start crafting a strong visual identity together!
Build an Online Presence
In today’s digital age, having a strong (and consistent) online presence is essential. Create a website that showcases your best work and provides potential clients with all the information they need to book your services. Don’t forget to leverage social media platforms like Instagram, Tik Tok, Pinterest and Facebook to connect with your audience and share your latest projects.
By investing in your brand, you’ll create a memorable and professional image that resonates with your target audience and helps your business grow.
The So What and more helpful resources:
Starting a small business or brand is such a rewarding venture, especially when you’re prepared with the right knowledge and tools. From choosing the best business structure to navigating taxes and securing the proper licenses, each step is crucial to your success. And remember, your brand is your business’s identity—make it creative, unique, and true to your vision. Get at me and let’s start collaborating together on building out your small business or brand!
