How to Start a Business in Tucson

Create a business plan

The city does not have any specifications for what they are looking for in business plans, however, most business plans follow a similar structure. First, most businesses go into detail about their executive summary. An executive summary is the “elevator pitch” of your business, describing what your business will be, what services or products you will provide, your mission statement and any goals that you have for your business. This section is ideally for investors to look at and get an overall picture of your business and help them decide if they are interested or not. For those that are not looking for investors, this section should help the business owner provide the basic information of the business whenever they need to describe it.

Second, business plans will identify the customer that the business is looking to cater to. It describes if the customers will be one-time customers or if the product or service is meant for them to purchase multiple times. This is also the area where most businesses will identify their problem statement, which is the pain point that their customers would like to have addressed in their lives.

Next, the business owners should have an evaluation of their target market. This should include the demographics they are looking to market to, where they are selling or providing their product or service, their ideal customers lifestyle, including their profession, hobbies, interests, salary, family, etc.

After evaluating their target market, opportunities should be outlined. In this section, business owners should state what the gaps are in the market that they are trying to fix or compensate for. This section also allows business owners to understand their competitors.

Business owners should know who their competitors will be, in both direct and indirect competition. Direct competitors are those who have the same or similar business product as you. Indirect competitors are those that may provide an alternative to your product or service, or are in the same industry and provide a different product that might take away from yours. For example, in the milk industry, different dairies would be in direct competition with each other. Their indirect competitors would be alternative milks or other beverages that people might drink in the mornings instead, like orange juice. It is important for business owners to know what differentiates them from the competition in order to properly market themselves.

Another important part of the business plan is building a financial plan. This part should cover the cost of making or offering your products or service, labor costs and any overhead you might have. Overhead would include fixed costs like rent and utilities for your business location, and variable costs like marketing and distribution.

Once you know your budget, you would want to dive deeper into your marketing plan. In this section you would create a pricing plan for your product or service based on the profit your business would need to break even. This is also the section where you would describe how your product or service would fit into its market, how you will promote it, where you will sell and what your profit would be based on your pricing plan.

After creating your marketing plan, you will want a section that describes your operations plan. This plan will outline how your business will be run day-to-day and what jobs will be required to run the business.

Once you have your operations outlined, you will create the last section of your business plan, which will describe your employee plan in detail. This will include what positions will you hire and the job responsibilities will be, how you will search for these employees and what the pay and benefits offered will be.

Register Your Business

Creating your business plan will help you determine what type of business you want to create: a non-profit, LLC or corporation. Once you know this information, the city of Tucson requires you to register your business with the Arizona Corporation Commission. Before you start this process, you will want to make sure that your business name you want is available through their website. Once you do this, you can register your business online through the ACC.

Register Your Business Name

After you have made sure that your business name is available and registered your business, you will want to tradename or trademark your business name. This can also be done online, through a link on the city of Tucson’s website, and it will last 5-10 years before you need to renew, depending on whether you apply for a tradename or trademark.

Find Your Business Location

In order to move forward with your next steps for starting a business, you will need to know where the business will be located. Once you have picked out your location, you will want to check if it is in Tucson city limits. If it is not, you will need to find out the city’s requirements for starting a business where it is located. Deciding on a location can also help you know the zoning details of the property and if the city has any incentives for starting your business in certain zoning areas.

Acquire an EIN

Acquiring an Employer Identification Number (EIN) through the IRS is an important step to starting your business because you will need your EIN to complete later steps and for future tax purposes. All you need for applying is the social security of the owner of the business and the basic business information. As long as you have these, you can apply online and receive your EIN immediately after completing the form.

Apply for a Business License

Applying for a business license is the most important step in the process, because you cannot operate without one. You can apply for a business license online through the Arizona Department of Revenue as long as you know your business name, location, phone number, EIN and type of ownership. If you also know your land use zone, you can also apply for a Home Occupation Application if you plan on starting the business in your home.

Acquire Transaction Privilege Tax License

Once your business is licensed, you will need to apply for a Transaction Privilege Tax License in order to apply sales tax to your products or services. Registering is also required to withhold taxes from your employee’s wages. This information will also be necessary for paying corporate income tax.

Receive a Certificate of Occupancy

While you are completing all of the steps after knowing where your business will be located, you will want to be simultaneously applying for a certificate of occupancy. This is required for newly constructed, relocated or altered areas of a building or business. When applying for the certificate, you will need to know what type of business will be located there, the square footage, building code and safety measures like fire sprinklers, and the zoning information. You can file for a temporary certificate if you need to be in the building earlier for things like employee training. The application also requires inspections, which costs $582.50 for each inspection required.

Apply for Sign Permits

In the city of Tucson, businesses are required to have a permit for signs. This includes wall signs, freestanding signs, A-frame signs, banners and billboards. The city will do inspections for sign permits as needed, but they do not list the cost for these inspections on their site or include any information on what would require an inspection.