The Importance of Business Permits

When it comes to starting a business or launching a new product line, most people do not apply much (if any) scrutiny to their business licenses and permits until something goes wrong. More often than not, business owners expect their license and business permit requirements to be simple and their certificates to be easily acquired.

As for their renewal deadlines, they assume that those can be dealt with at a later date. However, the reality is not so simple—business owners are routinely fined, stores closed, and penalties levied against store managers for their lack of compliance, so it’s not as easy as most people assume.

Obtaining business permits for a new business

New businesses work within compressed timetables. Between incorporating a business, getting an EIN, setting up payroll, and actually starting the business, there’s only so much time left over to take care of business license compliance. It can also take some time to accurately determine requirements for compliance based on a company’s activities.

Which business licenses are required for my industry?

First of all, don’t think in terms of your industry. To understand compliance, you’ll need to start thinking like a licensing authority. Your industry does not matter to them. They care about your activities.

Here’s how you can get started with finding the small business permits you need:

1.    Carefully define your business activities. You’ll need to examine all of your core and ancillary products. Don’t forget to consider any product tie-ins that affect your business. In the modern era, industry lines are increasingly blurred (as evidenced by the fact that convenience stores offer varied products and services). If you are a service-oriented business, then those services need to be dissected as well.

2.    Prepare a list of every business activity that might require business permits and licenses.

3.    If you plan to operate out of multiple locations, assemble a list of all your physical locations. Make sure to include the service areas that are applicable to your business, even if you don’t have a brick and mortar shop within the jurisdiction. (For example, if you or an employee on your payroll travel to different locations to do work, you probably need to be licensed and permitted by the destination licensing authority as well.)

How to get a business permit

Now that you have gathered all the necessary information, you can cross-reference your activity list and your location list. The next step is to get the applications from the licensing agencies that have authority over your locations. You can do this yourself, which may or may not be easy, depending on your business’s location and your local government licensing authority. There are also online services that can obtain the necessary licenses and permits for you—either for you to fill out and file on your own or to file them for you.

The single most important concept to remember is the word proactive. Whether you apply for the proper licenses and permits on your own or through a licensing service, you want to take these steps before you open the doors to your restaurant, before your first yoga student shows up for class, before you dress a mannequin in your display window, before your e-commerce site goes live, or before you start landscaping your customer’s property. No business owner wants to be holding the bag if a location gets padlocked for non-compliance.