How to Write a Business Plan: A Comprehensive Guide

ByMilica Milenkovic

June 27,2022

Are you thinking of starting a business? If so, you will need to create a business plan, i.e., a comprehensive guide outlining your business goals and strategies. This document is useful for onboarding new people or securing financing from investors or banks.

Since it's often the key to securing funding, we will walk you through everything you need to know about a business plan and when you will use it. Most importantly, we'll show you how to write a business plan and break down the typical components of a business plan template, so you don't get overwhelmed. And, as always, we'll provide you with tips for creating a successful one.

What Is a Business Plan?

A business plan is a document laying out a business's objectives and the planned tactics for achieving them. In short, this business strategy outline is your roadmap for success. While there is no one-size-fits-all business plan, there are certain elements that all successful programs should include.

So, what does a business plan look like? It typically includes an executive summary, company overview, market analysis, competitive analysis, and financial forecasts.

However, it's important to remember that a business plan is not set in stone. As your business grows and evolves, you will need to revisit it and make adjustments. Think of it as a living document that will continue to evolve as your business does.

When Is a Business Plan Useful?

Using a business plan as a roadmap streamlines business growth. A company can always reference it, i.e., use it as a guide to prioritize tasks and objectives, and form future strategies. These are just some of the reasons it’s worth taking the time to write a business plan.

However, as mentioned before, a business plan is not set in stone - it should be updated regularly, improved when needed, and adjusted to maintain usefulness. It can only be as valuable as businesses make it. Some companies might go for an extremely detailed document, while others might opt for a brief business plan outline focusing on financials to present to investors.

In the same vein, it’s a valuable tool for communicating with potential business partners, customers, and venture capitalists, as well as hiring new employees. Everyone would rather work with an established business with a developed business model, so a good business plan is often crucial to establishing these relationships.

Why Is a Business Plan Important for Investors?

A business plan is essential for securing investments, as it outlines the company's goals, strategies, and the procedures to achieve them.

Creating a business plan is essential for presenting your business to investors because it

allows them to see the big picture,
understand the risks and potential rewards involved,
evaluate whether the company is a good fit for their portfolios.

A well-crafted and detailed business plan shows you've done your homework and are serious about making your business a success. It also demonstrates you're aware of the risks involved and have thought through how to overcome them. In short, a business plan is a foundation upon which a successful investment deal can be built.

So, if you're looking for an initial investment, make sure to create a business plan. It will make the difference between getting funded and getting rejected.

The Components of a Business Plan and How to Write Them - a Step-by-Step Guide

It's time to break down the components of a business plan. As mentioned, there is no one-size-fits-all template to use. However, all successful plans should include certain elements, so here is how to write a business plan, step by step.

Executive Summary

This is a brief overview of your business, its products or services, market, and financials.

The summary is the first (and often only) chance to make a good impression on potential investors. It is vital to ensure that the summary is well written and free of errors.

How to Write an Executive Summary?

Here are a few tips for writing a practical executive summary:

Start with a bang: The first sentence of the summary should be attention-grabbing and give a brief overview of the business.
Keep it short and sweet: The summary part of a business plan should be no longer than one page.
Focus on the essentials: The executive summary should highlight the critical points of the business plan, including the company's mission, products or services, target market, and financial projections.
Use simple language: Avoid jargon and technical terms in the executive summary. Stick to plain language all readers can understand.
Proofread carefully: Proofread the executive summary before sending it off to potential investors to secure funding. Use a reliable grammar and spelling checker to fix every mistake to make your business look more professional.

Company Description

This covers your company description, history, structure, and management team.

When writing the company overview section in a business plan, there are a few things to consider. First, it's important to briefly describe the company's history and how it got to where it is today. This will give readers a better understanding of the company's mission and values.

Second, it's essential to describe its current structure and management team. This will help potential investors see that the company is well-organized and has a solid foundation.

Finally, it's important to highlight any recent accomplishments or awards that the company has received. This will show that the company is growing and thriving.

Product or Service Description

This is a detailed description of the product or service you are offering, and is an indispensable aspect of every well-researched business plan.

Every business plan needs a description of the products or services the company intends to sell. This part of the business plan is often called the Value Proposition or Unique Selling Proposition.

The product or service description should be clear, concise, and confident. It should explain what needs the product or service fulfills and how it’s better than other options on the market. This section of the business plan is your chance to sell your idea, so make sure to put your best foot forward.

Remember that the product or service description is not a sales pitch - it should be an honest and accurate representation of what you are offering.

How to Write a Product or Service Description

With that in mind, here are a few tips for writing a solid product or service description when making a business plan:

Know your audience. The product or service description should be tailored to your target market. What needs does your target market have that your product or service can address? What pain points can you solve?
Keep it simple. The best product or service descriptions are clear and to the point. Avoid using technical jargon or overly complicated language - you want your audience to understand why what you are offering is valuable.
Be confident. This is not the time to be modest - highlight the unique selling points of your product or service and why it is the best option on the market.

Market Analysis

This is a deep dive into your desired market, including an analysis of other businesses in your niche, and you shouldn’t skip it when you build a business plan.

This analysis is a breakdown of the industry the business will operate in. This includes an examination of the current market landscape and an exploration of the potential opportunities and challenges that lie ahead.

How to Write It?

Here are a few tips to help you get started:

Do your research. Before you can write this part, you need to perform market research. Be sure to examine both the current landscape and the potential future trends that could impact your business.
Know your audience. It's always important to keep your audience in mind, especially when starting a business plan. After all, not everyone will be familiar with the ins and outs of your industry. As such, it's essential to make your market research and its findings both informative and accessible.
Keep it concise. Analyses are integral to any business plan, but they shouldn't be overly long or convoluted.

Competitive Analysis

No business exists in a vacuum, and understanding other companies in your niche is critical for pinpointing competitive advantages and crafting a winning strategy.

But what exactly should this part of the business plan format include? In essence, it should provide an overview of the key players in your field and assess their strengths and weaknesses. It should also identify any gaps in the market your business could exploit and use within its marketing and sales.

While this may sound like a lot to cover, don't worry - with a bit of planning, you can easily produce an analysis that will impress potential investors and help you start your business off on the right foot.

Financial Forecast

Whether you're starting a new business or forecasting for an existing one, the process of writing a financial forecast is essentially the same. However, if you haven’t written one before, we suggest using a business plan template to guide you through the writing.

The first step is to gather historical data, if available. This could include sales data, financial statements, expenses, inventory levels, and everything else that can help you gauge your business' financial health. If you are a small business and don't have any historical data to work with, don't worry - you can still produce a reliable forecast using market analysis and industry trends.

Once you have your data, it's time to start creating your forecast. Begin by estimating the net income you expect your business to generate in the upcoming year. Then, evaluate your expenses and investment needs. Finally, use your estimates to calculate your desired profit margin.

When writing a financial forecast to create a business plan, it is important to be realistic and conservative. Include all expected sources of revenue and expenses, including one-time costs, such as new equipment purchases. Be sure to include a buffer for unexpected payments, such as repairs or slowdowns in sales.

Finally, don't forget to account for seasonal fluctuations. If your business is dependent on the holiday season, make sure to account for that in your forecast.

Business Goals

Every business plan should have a section dedicated to goals. You’ll often find this section marked last on most business plan examples. This is where you lay out what you hope to achieve in the short- and long-term. However, simply stating your goals is not enough. The goals need to be specific, measurable, achievable, relevant, and time-bound (SMART):

Specific: Vague goals are of little use, especially to you. Instead, focus on specific targets you can realistically achieve. For example, rather than setting a goal of “increasing sales,” good examples of business plans will aim for a more specific target like “boosting sales by 10% within the next year.”
Measurable: A good goal is something that can be measured. This way, you will know whether you are on track to achieve it. For example, rather than setting a goal of “improving customer satisfaction,” go for something like “reducing customer complaints by 25%.”
Achievable: Ensure your goals are realistic and attainable, in line with your resources and timeline. For example, you can write something along the lines of: "Increase year-over-year sales by 20% by Q4 2022."
Relevant: Make sure your goals are relevant to your business's overall mission and strategy. If your business is based on subscriptions, "Increase the number of subscribers" could be a better goal than "increasing daily sales" in the business plan, for example.
Timed: Giving yourself a deadline will keep you focused and motivated. Without a deadline, it is all too easy to put off taking action on your goals. For example, rather than setting the goal of “launching a new product” whenever, aim for a specific timeline.

Types of Business Plans

Your company can rely on different business plans, depending on its stage of development and needs. The most common types of programs are:

The Operational Plan

An operational plan covers all aspects of how a business will operate on a day-to-day basis. These business plans include everything from a company's organizational structure to its operating procedures.

Operational plans are important for small businesses because they provide a presentable roadmap, which is especially helpful if you're seeking funding from investors or lenders. After all, it shows them you clearly understand your business and its operations.

Operational plans are also important for internally managing a business. They can be used to track progress and ensure everyone is on the same page, working towards the same goals.

The Strategic Plan

A strategic plan is a high-level roadmap for a company's overall goals and how it plans to achieve them. This vital aspect of small-business plans is the basis for building an operational plan and assigning daily tasks according to long-term objectives.

Strategic plans are important for businesses of all sizes because they guide decisions about where to allocate resources and how to prioritize initiatives. Strategic plans are also useful for communicating a company's direction to its employees, shareholders, and other stakeholders.

The Marketing Plan

A marketing plan provides an outline for how you will promote and sell your products or services. It can also be a standard part of a regular business plan format. Marketing plans are essential for businesses of all sizes but can be especially helpful for small businesses that have yet to establish their sales strategies.

These could include overall company plans but also go into detail. For example, you can write down which website builder your business should use, or add "selling advertising space" as a goal. Marketing plans can also be used to track progress and measure results over time.

The Financial Plan

A financial plan outlines a company's financial goals and how it plans to achieve them. Financial plans are an essential part of any business plan, and outline how you will generate revenue and manage expenses. If your results aren’t in line with your financial plan, chances are, you’re in trouble.

Special Business Plans

While the plans listed above are used to navigate the business strategies and quickly onboard new people in any company, some documents are specific to a type of business or one of its purposes. Let’s discuss those briefly as well.

Lean Startup Business Plan

A lean business plan is a shortened, more agile version of a traditional business plan. Lean startup business plans are designed for businesses that are moving quickly and need to adapt their strategies on the fly.

It’s typically around 20 pages long, whereas your typical traditional business plan would contain about 50 pages. The lean one focuses on the company's value proposition, its market, and its financials.

This type of business plan is especially helpful if you're a startup or have a new business idea because it allows you to quickly adapt your methods as you learn more about your customers and market. On the other hand, traditional business plans don't leave as much room for growth in their outlines.

Venture Capital Business Plan

A venture capital business plan is a document that describes a new business venture, typically one with high growth potential. The plan should include information on the company's products or services, target market, team, and financial projections.

For example, all plans should have a clear mission statement about the problem the company is solving. This is followed by a description of the proposed solution, overview of the market opportunity, and detailed plan for how the company will reach its goals.

The last section of venture capital business plan forms is typically a financial analysis, which shows how much money the company will need to get started and how it expects to generate revenue.

While VC business plans can vary significantly in length and format, they all share the same goal: Persuading investors to provide funding for the new venture.

Micro-Business Business Plan

A micro-business business plan is a document that outlines a small business's goal, strategies, and tactics. This type of business plan should include the following aspects:

Business's mission and vision
Market opportunity
Target market
Company competitive advantage
Sales and marketing strategy
Operational plan
Financial projections

A micro-business plan should be updated regularly as the business grows and changes. It is an essential tool for any small-business owner.

Tips on How To Write a Business Plan

Now that we've gone over the different business plans, let's look at some tips you might benefit from.

Set realistic goals: It's essential to set realistic goals for your business, both in the short and long term. Be specific about what you want to achieve and when you want to achieve it.
Do your research: This may seem like a no-brainer, but it's important to do your research before writing your business plan. You need to understand your industry, market, and competition clearly.
Keep it concise: A business plan should be clear and concise. No one wants to read a 50-page document, so focus on the most important information.
Make it visually appealing: When you build a business plan, it pays to make it beautiful. A well-designed business plan is more likely to be read and remembered. Include charts, graphs, and other visuals to make your pitch more engaging.
Get feedback: Before you finalize your business plan, it's important to get feedback from people you trust. This could be a mentor, advisor, or even a friend who has invested in businesses before.

Final Thoughts

Writing a business plan may seem daunting, but it doesn't have to be. By following the tips above, you can create a well-written, concise, and visually appealing business plan to help you achieve your goals.

If you're still unsure where to start writing a business plan, there are plenty of online resources, like templates, samples, and tutorials. Once you get started, you'll be surprised at how easy it is to write one. And, who knows? You may even find that you enjoy it.

FAQ

What are the four types of business plans?

There are four types of special business plans: Traditional, lean startup, venture capital, and micro-business. Each type has its own unique set of characteristics and is designed for a specific purpose. A micro-business plan, for example, is typically created to serve as the roadmap for the growth of a small business. In contrast, a venture capital plan for a business is geared toward getting the investments a business needs to develop.

What is the most important thing in a business plan?

There is no one answer to this question, as every business plan is different. However, there are a few key things that all business plans should include, such as a description of the business, its products and services, and its target market. Additionally, business plans should outline the company's goals and strategies for achieving them.

Can you start a business without a business plan?

While it is possible to start a business without a business plan, it is not recommended. A business plan serves as a roadmap for the company and to gain investments, so it is crucial to figure out how to write a business plan and create one before you start your business.

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These platforms also charge commissions for their services, so you might not be able to get as much profit as you’d hope for. Luckily, this eCommerce business idea is scalable, so you can switch your initial setup into one that works better for your new online business anytime. Create Your Online Restaurant If you have been toying with the idea of setting up a food truck, why not start it online? This could include anything from homemade meals, jams, organic food, cakes, and baked goods, to handmade pet treats for our little furry friends. If you decide to go with a restaurant-type online business, make sure to find a good website builder designed for restaurants. This will allow you to create a website that includes a menu and other relevant features to help your restaurant grow into a profitable eCommerce business. Fill a Niche Food Role These days, people are looking for convenience, especially when it comes to their meals. If you can fulfill this role and provide them with easy solutions for their meal planning, you might make a big buck online. Online grocery stores, meal-making kits, and fresh or frozen food subscription boxes are skyrocketing in popularity. After all, the online purchase of restaurant/meal kit delivery amounted to 33% of all online purchase categories in 2018, and the growth didn’t stop. This is becoming more prominent, especially for niche products and dietary restrictions, such as vegetarian, vegan, or gluten-free. If you’re thinking of running a food business as someone who loves this type of food, it could be the perfect choice among our ideas for eCommerce businesses to start. Start an Online Pet Store Another great eCommerce business idea is to start an online pet store. If you love animals, this could be an awesome online business for you. You can sell pet supplies, food, toys, and more. You can also offer pet-sitting services or dog-walking services through your eCommerce business. To get started, create a website or blog to showcase your products and services. Use social media to spread the word and attract customers. With dedication and effective marketing activities, you can build a successful online eCommerce business. Set Up a Shop To Sell Vintage Items Do you have a passion for collecting vintage items? If so, why not join one of the most profitable eCommerce businesses ever? You can sell vintage clothes, furniture, art, and other collectibles that you've accumulated over the years. These eCommerce business ideas are a great way to make money online if you have an eye for spotting valuable items. Just be sure to do your research before listing anything for sale, as you don't want to undervalue your items. Provide Services Online Almost any service that you could provide in a brick-and-mortar venue - you can also provide through your eCommerce store. If you’re searching for eCommerce business ideas, you don’t have to sell physical products. Instead, it could be anything from digital marketing or personal shopping to expert consulting services - anything you could already be providing offline. If you have a skill or expertise that you think people or businesses would be willing to pay for, start offering your services online through your eCommerce business. You can promote your services through a website or social media and start making money. Not sure which business you should transfer online? Here are some eCommerce business ideas for services. Provide Online Classes or Tutoring Online You can make money online by providing services such as consulting, coaching, or tutoring. Online education is gaining popularity, and you should jump on the bandwagon if you have skills to share. This is a great way to monetize your skills and knowledge. Just be sure to set your prices competitively and market your services in a way that speaks to your target group. Depending on your expertise, you could consider various potentially profitable eCommerce businesses. You can provide one-on-one courses via Zoom, for example, or pre-record lessons and charge subscriptions. Make sure to find the right medium for transferring knowledge to your audience. Translate for Others If you know a second language, not only can you offer online courses as your eCommerce business, but you can also start a freelance translation business from home. You can start by creating a website or blog to promote your services. As with all good eCommerce ideas on our list, acquiring new clients will take some time. You can also use social media sites like Facebook and Twitter to spread the word. When you get your first project, be sure to ask for the client's requirements so you can give them an accurate quote. Once you complete the project, ask for feedback so you can improve your services and include testimonials as references. With a bit of digital marketing, you can build a successful translation eCommerce business. Become a Social Media Manager If you're good at leveraging social media, you don’t have to look for additional ideas for an eCommerce business - you can make money online by managing social media accounts for businesses or influencers. Social media is a great opportunity for communicating with customers, finding new clients, and promoting your products and services. However, not everyone has the skill set needed to get the most out of their social media accounts. This is where you could come in and assist businesses to improve their relationship with customers on social media. If you have a knack for building followership, posting engaging content, and communicating with your audience, this might be the idea to pursue and build a profitable eCommerce business. It’s advisable to choose businesses or influencers that are relevant to your niche. Promoting your portfolio website on social media could provide you with the metrics you need to impress potential customers. Start an Accounting/Bookkeeping Firm If numbers are your forte, you can turn it into a business by starting an accounting or bookkeeping firm. Many people struggle with paperwork come tax season or with day-to-day bookkeeping. If you can provide reliable service, your clients will come to depend on your assistance. You can also consider business accounting as one of the eCommerce business ideas for people comfortable with crunching numbers. While the niche boasts renowned bookkeeping companies and is saturated as a result, you can still claim a piece of the pie for yourself. Consider working locally or collaborating with smaller companies that don’t need a large accounting team to manage their paperwork. These companies prefer working with someone who can provide their expertise and a bit of extra care and dedication. Become an Online Fitness Trainer If you're a fitness enthusiast, you can make money by providing online fitness coaching. This is a great eCommerce website idea to pursue if you're able to build up a large following. This holds true for yoga and other types of physical activity that can be done online. Similar to those video tapes with exercises that were all the rage in the 80s, you can also record and sell training programs or create fitness plans, diets, and so on. Depending on the online fitness coaching type you provide, one medium might work better than the other. Become a Freelance Writer, Designer, or Developer If you're a writer, designer, or developer, you can make money online by offering your services on your eCommerce website. The idea is that your site should serve as your portfolio and opportunity to promote yourself to new clients, but also as a store to accept payments for your work. While anyone can create a website in a manner of minutes with all the free website builders, these professions are still valued on the global market. Apart from creating your site, you can also join some of the popular freelance marketplaces or promote your services via social media. Become a Virtual Assistant On the same note, if you're good with computers and have some administrative skills, becoming a virtual assistant is among good eCommerce ideas to consider. Virtual assistants provide administrative, technical, or creative services to clients from their home offices. For this role, you’ll need excellent organizational skills and a willingness to dedicate time and effort to finding the right clients. You will also have to compete with some established virtual assistant companies, but if you focus on smaller businesses and entrepreneurs, you’ll be able to make more than a decent living with this option. Offer Event or Wedding Planning and Organization When it comes to profitable eCommerce business ideas, providing wedding and event organization is another service you can promote and book online. Not everyone has the time or creativity to organize everything for their big day, company outing, or kids’ party. This is where your eCommerce site comes into play. You can offer services online and allow your customers to book through your eCommerce store. For this to be successful, you'll need to create a large network of vendors, caterers, and other third parties. However, if you already have such service providers standing by, this business could be the right idea. No Clients Needed If you are an introvert and prefer not to deal with clients or customers, you can still make money online. There are excellent online eCommerce business ideas you could pursue, so let's discuss those as well. Start With Affiliate Marketing Affiliate marketing is a type of online marketing where you promote other people's products and earn a commission on any sales that you generate. This can be a great way to make money online if you're able to drive traffic to your affiliate links. Just be sure to choose products that are relevant to your niche and audience. So, where do you start with affiliate marketing now that you’ve chosen it among other ideas for an eCommerce business on our list? You could create a blog, social media account, or YouTube channel where you review products from an array of brands. Having a niche market, you can tap into through your blog or account can be a great way to earn affiliate commissions, as well as build up your own brand and authority. You'll need to invest some time and effort into creating high-quality content, but if you can build up a large following, you'll be able to make a great living reviewing products online. Launch a Dropshipping Business Another excellent choice that belongs to the easy eCommerce business ideas category is launching a dropshipping business. When you dropship, you simply sell products sourced and fulfilled by a supplier. This can be a great way to get started in eCommerce with little or no investment. You just need to find a reputable supplier and set up your eCommerce store. Once you've got everything up and running, it's just a matter of driving traffic to your site and making sales. You'll also be responsible for customer service and ensuring that your shoppers are having the best experience. After all, 91% of customers will simply leave and never return if they have a bad experience with your store, which is something new businesses cannot afford. Bottom Line There are plenty of ideas for an eCommerce business that involve selling products or services. So, if you're looking to get started in eCommerce, be sure to choose the option that best suits your skills and interests. Moreover, take a closer look at the professional network that you’ve built up over the years and then decide which avenue to pursue. With commitment and effort, you can start making money online in no time!

By Vladana Donevski · June 23,2022

Knowledge Base

Incorporation Documents: What are the Articles of Incorporation?

The documents for incorporation differ by state, and the nature and type of the business looking to incorporate. In the United States, Corporations and Limited Liability Companies (LLCs) are the two main types of business entities, and require different documents to achieve that. In this article, we will learn the differences between articles of incorporation and organization, their components, the filing process, and why they’re necessary. Let’s get right into it! Articles of Incorporation: Definition The articles of incorporation - also known as a corporate charter, articles of association, or a certificate of incorporation - are legal documents filed to establish a company of a specific type as a business entity. In other words, they give the corporation its legal identity. In practical terms, for a corporation to open a bank account, issue stock or shares, operate within a state, and engage investors, it must first file articles of incorporation. In the United States, this is usually done with the Secretary of State or company registrar, depending on the state of incorporation. Delaware and Nevada are the most popular states for registering your corporation, because of their friendly regulations and minimal tax requirements. Articles of Incorporation vs. Organization Most people tend to confuse articles of incorporation with articles of organization, but they are not the same; now that we’ve defined the former, we’ll do the same for the latter. The articles of organization are filed at the point of creating an LLC. In terms of function and components, they are no different from articles of incorporation. However, the regulatory requirements are different and might be stricter, depending on the state and industry the business is in. These are the primary thing to research for prospective owners learning how to incorporate their business. The next step is filing your articles, so it’s time to learn how it works. Filing Articles of Incorporation The Required Documents The components of documents to be provided upon filing articles of incorporation vary by state, but many of them are the same everywhere. Most of these components will be on the face of the certificate of incorporation, and they include: The corporation’s name and address The name and address of the registered agent responsible for accepting legal documents on behalf of the corporation; some states may require a formal agreement of the agent’s acceptance of this responsibility. The number and type of authorized shares; more details on this can be found in the articles of incorporation and their bylaws. The type of corporate structure (e.g., profit, nonprofit, etc.) The names and addresses of the founding board members The names, signatures, and addresses of the persons handling incorporation; a corporation can have multiple incorporators who do not need to be directors or stockholders. If applicable, the lifespan of the corporation, as some corporations are made to exist for a limited time and carry out a particular function. The number and type of stocks the corporation can issue. Other components which are not required, but can be included, are: The limitation of directors’ liability Stockholder actions The assignment of authority to call stockholder meetings The purpose of incorporation, which may not need to be specific, depending on the state. The Filing Process The end goal of filing is to receive a certificate of incorporation. After preparing the documents, the incorporator should schedule an appointment with the designated filing agency of their state. Procedures differ between states, but generally begin with paying a filing fee after submitting the required paperwork. The process is completed upon acceptance of the paperwork and approval of the corporation’s registration. In most states, corporations must have both articles of incorporation and bylaws, even though bylaws are not to be filed. Bylaws only serve as internal documents setting out the rights and responsibilities of a corporation’s shareholders, directors, and other officials. Benefits of Incorporation Corporate Brand Identity Customers are more inclined to trust and do business with a brand when its corporate identity is established, as are investors. Banks are more likely to finance your venture if it’s an official business, and you’ll certainly look better in the strict due diligence checks on your business. Where no official or formal records are found, chances are that funding will disappear for lack of confidence in the safety of investing in you. Tax Advantages A corporation’s tax liability can be reduced depending on the state of incorporation. This tax reduction is often justified through operational costs like insurance, green energy investments, employee retirement benefits, production costs, employee wages, etc. Separation of Liability Filing your articles of incorporation separates the corporation's liabilities from those of its owners, in events of criminal activity, injury, or loss. The owners’ personal assets cannot be seized, auctioned, or sold if the business goes into debt. On the other hand, owners of unincorporated businesses are at risk of losing personal property in such situations. Protection of the Business Name Before an applicant is accepted, the state of incorporation will conduct a search to ensure that no other existing business or corporation has the same name. Applications for companies with an already taken business name won’t go through, because those names are protected - but only if their owners incorporated in time. Business owners also have the right to seek legal consequences for infringement of this protection. Perpetual Existence For businesses with no preset lifespan, the articles of incorporation guarantee longevity and perpetuated existence. This means that, in the event of withdrawal or death of one or all owners, the business remains in existence. By extension, a transfer of ownership is an option for incorporated entities. Unincorporated entities suffer a different fate and cease to exist in such situations.

By Vladana Donevski · June 30,2022

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