These are the most common steps to starting a business in Sonoma County across different industries!
✨ Steps to Start Your Business ✨
🕵️ Initial Research and Information
Starting a business carries risks. As an entrepreneur, you can diminish these risks by performing some due diligence as part of the initial planning stages. In Sonoma County, there are plenty of resources available to guide entrepreneurs through these steps.
👋 Start with the Economic Development Collaborative
Our Business Services Team provides a host of services to get your business up and running, including:
- Industry trends
- Market research
- Finding a location
- Finding customers
For more information on our services, visit our Business Services page.
🏅 Business Coaching and Workshops
At every stage of business formation and growth, it can be helpful to consult local resources that offer business counseling and informative workshops.
👬 Local Business Associations
Local chambers of commerce can provide additional assistance that can be of particular use for a business owner looking to locate in a specific city or region. For a list of chambers of commerce in Sonoma County, visit our Networking & Business Organizations page.
💻 Online Resource Guide
The United States Small Business Administration (SBA) has a comprehensive online resource guide for entrepreneurs. The website offers assistance with local resources and mentoring, government contracting, and loans and grants available to small businesses.
SBA San Francisco District Office
455 Market Street
Suite 600
San Francisco, CA 94105
(415) 744-6820 or sba.gov
📝 Develop Your Business Plan
Document your business goals and develop a roadmap to profitability. See our guide to business plans here to get started!
📎 What to include in your business plan
Your business plan communicates what your business does, your vision for the future, and the steps you will take to reach those objectives. Generally, the business plan should include:
- An executive summary
- A marketing plan
- An operations plan
- The proposed organizational structure
- Financial projections
Your developed business plan should also include the following:
- The legal structure of your business
- You have probably heard the terms sole proprietorship, general partnership, limited partnership, and type C or S corporation. The determination to form a company under a particular structure has much to do with the business activity, location, and organization.
- For more information, see our page on Business Structure.
- The legal structure of the business will dictate many of the entity's operational functions and tax liability, entrepreneurs are encouraged to seek legal advice when considering these choices
- For more information, see usa.gov/business
- You have probably heard the terms sole proprietorship, general partnership, limited partnership, and type C or S corporation. The determination to form a company under a particular structure has much to do with the business activity, location, and organization.
- The business name
- Any business must register its name with the California Secretary of State’s office. Information on searching name availability and filing requirements can be found on the Secretary of State website.
🖨️ Business plan templates
Check out these resources that include advice and tips for success:
💰 Finance Your Startup
Ensure that you have enough capital to finance your operations. Once you have developed a business plan, there are several resources for small business financing. Check to Financing and Capital page for more information!
🗃️ Get organized
Project Costs
- Your project includes everything needed to open for business. Building, leasing costs, inventory, equipment, vehicles, marketing, etc. These details should all be outlined in the business plan.
Collateral
- Do you have cash or their assets that you will be investing in your business? Generally speaking, lenders like to see some "owner-participation" with regards to financing. This demonstrates a commitment to the business and its success.
- Most lenders request an equity of 20-30%. Equity is the amount put up by the business owner. Therefore, if the total project costs are equal to $150,000, then an owner should expect to contribute around $30,000-$45,000 in cash/assets. Assets are anything of value that can be exchanged for cash, such as artwork, vehicles, or land.
Pre-Application
- Lenders often cite that applications are denied simply because they are not complete, or the prospective borrower did not fully understand application requirements. Check with your local lender about setting up an appointment in advance of submitting your application to ensure you meet all requirements.
See our Financial Application Guide for common documents requested and tips for preparing to apply for business financing!
💲 Obtain financing for your business
When you are ready to pursue financing, you will want to visit the Finance Your Business page for a complete list of banks, credit union, alternative loan financing available in the area.
📁 Local Licensing Requirements
✔️ Business licensing requirements
You are required to obtain a business license if your business is located or doing business in the nine cities of Sonoma County. If your business is located or operating in unincorporated Sonoma County (outside a city boundary), the County of Sonoma does not require a business license or tax certificate. While a business license is not required from the County, businesses must still comply with other applicable rules and regulations affecting their operations.
During this application process, it’s always a good idea to check with city staff about any additional business permits, licenses, or requirements.
Check out our articles on Obtaining a Business License and Specialty Licensing and Permitting for more information!
✏️ Fictitious business name statement
If your new entity will conduct business under a name that does not contain the surname of any and all owners, or is a corporation that will do business under a different name than is registered with the State, you will need to file a Fictitious Business Name Statement (FBN) with the County of Sonoma Clerk-Recorder-Assessor’s Office. This application must be filed within 40 days of the business start date.
For more information, see our article on who needs an FBN Statement.
FBNs are sometimes known as "Doing Business As" (DBA).
✒️ Register Your Business
Register your business correctly with the California Secretary of State. Registration requirement and forms may be found at the California Secretary of State website: www.sos.ca.gov/business-programs
This should be done after you determine the most appropriate operating structure for your business, and have determined its name. All documentation must be approved by the State of California before the business can become a legally-recognized entity.
📚 State Licensing Requirements
👔 Professional or specialty licensing
If your new business involves providing a service or specialized product, there is a chance that the State of California will require you to carry some form of occupational or professional licensing.
Specialty or Professional licensing is required for certain business sectors and professions. The appropriate agencies and requirements may be found on the state’s CalGold website, which offers a wealth of information on licensing and permitting requirements – including contact information – sorted by location and business type.
📇 Seller's permit and special taxing
If your business will offer products for sale and/or specially regulated items such as alcohol and tobacco, it is likely that the State will require a seller’s permit and special taxing considerations. Both can be applied for online. For more information about licensing and permits, including seller’s permits and use tax information, contact the California State Board of Equalization at:
Santa Rosa Field Office
50 D Street Room 230
Santa Rosa, CA 95404
800-400-7115 or www.boe.ca.gov
🏦 Zoning and Permit Requirements
Sonoma County is comprised of nine incorporated cities, and the unincorporated area is governed by the County of Sonoma. Each jurisdiction is charged with regulating permits and ensuring compliance within its own boundaries. Various state agencies also regulate air quality, water quality, food safety, employee safety, energy efficiency, and the like.
Once you have a business location in mind, check with the local permitting and zoning authority to ensure your business use complies with regulations and to determine the necessary steps involved in establishing the business location. Contacts for each of the planning, health, and development agencies in Sonoma County can be found here!
Don't know what jurisdiction you fall under? Check out Permit Sonoma's zoning look-up tool - simply put in your address and click "View Report."
💸 Tax Requirements
Businesses are likely to be subject to federal, state, and local taxes. Entrepreneurs are strongly advised to consult with a tax professional as they consider business activity, organizational structure, and location. For reference, federal and state taxing agencies are described below.
⚠️ Internal Revenue Service (IRS)
If you plan on employing anyone, you must register for an Employer Identification Number (EIN) with the IRS. You can apply for an EIN online.
Further federal tax information can be found by contacting the IRS at:
777 Sonoma Avenue
Santa Rosa, CA 95404
(707) 523-0924 or irs.gov/Businesses
📈 California State Franchise Tax Board
Businesses in California are subject to various taxes based upon activity, size, and employment, among other factors. The following websites can provide information on California Business Tax requirements, forms, filing dates and other important information:
- California Tax Service Center: taxes.ca.gov
- California Franchise Tax Board: (808) 852-5711
‼️ California Department of Tax and Fee Administration (CDTFA)
The BOE monitors special taxation items such as fuel, alcohol, and tobacco, as well as the collection of California State sales tax and use taxes. More information may be found at: boe.ca.gov or by calling (800) 400-7115.
💼 Set Up Business Operations
💳 Open a business bank account and credit card
Opening a bank account for your business is a recommended step to separate business assets from your personal assets. Opening a business credit card is also a good idea to separate business expenses from personal expenses and build up credit for your company.
For more information on opening up a business bank account and credit card, click here.
📜 Insure your business
Buying business insurance coverage to protect yourself in case of property damage or legal action is always a good idea. There are many different types of insurance, some are required by law and depend on your business structure. There are many factors to consider when picking an insurance depending on your needs.
- Assess your risks
- Find a reputable licensed agent
- Shop around
- Re-assess every year
👥 Hire Employees
If you plan to hire employees, utilize countywide resources to hire, train, and recruit your workforce.
If you plan on hiring employees, there are additional local, state, and federal regulations. Below are some additional online resources that outline these requirements.
😀 Local hiring resources
- Visit our Find Employees page for more information on how the EDB can assist with your workforce needs on County Job Link/CalJobs
Sonoma County Job Link/Cal Jobs
2227 Capricorn Way
Santa Rosa, CA 95407
joblinksonoma.org or (707) 565-5550