Steps to Starting your Business

Starting a Business in Portland

Starting a successful business requires a great deal of preparation. Luckily, there are a number of resources you can tap in Portland to help you get your business off the ground. The information below is intended to help guide you to the appropriate resources. Please keep in mind that different types of businesses have different needs, obligations, and federal, state, and local requirements and regulations.

Below are some basic steps for someone looking to start a new business in Portland.

Before you Begin a Business
Are you ready to start a business? The Small Business Administration offers an assessment tool to help you determine your readiness for starting a small business.

Develop a Business Plan
The process of developing a business plan, including the thought involved before writing one, forces you to take an objective, critical look at the business in its entirety. Take advantage of the Business Plan template available through the SCORE Business Toolkit.

Another source for Business Planning can found at the Small Business Administration here. In addition to describing the steps involved in developing a business plan, the Small Business Administration site also offers free online courses to help walk you through the process.

Seek Professional Advice
If you need help developing your business plan, or you’re ready to have it reviewed, contact the local SCORE office who can assist with helping to create or refine the plan. SCORE is a national, non-profit organization who is a group of working and retired business executives who volunteer time to assist people in starting-up new businesses. You can also get advice from the Oregon Small Business Development Center who has offices in Portland. Check out bizcenter.org for more information, and to schedule an appointment. The Oregon Entrepreneurs Network provides a service to review business plans for a fee. Information for the Oregon Entrepreneurs Network service can found here.

If you plan on having employees, it may also be helpful to consult an attorney, who can answer questions regarding labor laws, or can assist with landlord-tenant laws if you plan on leasing a place for operating your business. Lewis & Clark Law School's Small Business Legal Clinic can provide transactional legal advice to new and emerging businesses. See the Small Business Legal Clinic for more information about who they serve and to request an appointment.

Identify Financing
Key to a successful business start-up is the ability to secure financing. Most businesses are started with personal savings or financing from friends and relatives. Some start-up businesses rely on personal credit cards or lines of credit. With industry experience, a good business plan and collateral, it may be possible to secure financing for a start-up business through a bank or other traditional financial institution. If a start-up business is able to access traditional bank financing, it will likely be through a program such as those offered through the Small Business Administration’s Guaranteed Loan Programs.

Other sources of funding for business start-up include government programs such as those offered by the Portland Development Commission and Business Oregon. Other sources include organizations that are furthering a specific mission, including Mercy Corps Northwest and Craft3. Some business start-ups are able to tap into venture funding and angel investors, which take an equity position or partial ownership in a business. The Portland Angel Network is one organization in Portland that invests in early stage businesses. In most cases, from government programs to equity investors, the requirements for receiving funding are similar to traditional banks.

Select Your Business Structure
Consulting one of the professional advice sources above should be able to help with this step, but it’s important to know that a business can be conducted under one of several organizational structures. A business operator may choose to operate the business alone (sole proprietorship), with another person (general partnership), or as a separate legal entity (corporation, limited liability partnership, or limited partnership). Each business structure had advantages and disadvantages and is generally chosen for liability and/or tax reasons.

For a description of the business structures, see the information from the Small Business Administration hosted here.

Create and Register a Business Name
Every business must have a legal name. Depending on the type of business and name chosen, the name may need to be registered with the Corporation Division of the Oregon Secretary of State. You can find the guidelines for registering a business name, search business names already in use and register a new business name at the business section of the Corporation Division web site here.

Check State and Local Portland Requirements
The State of Oregon does not have a general business license. However, many occupations and business activities require special licenses, permits, or certifications from state agencies or boards. These licenses, permits or certifications may regulate an industry’s rates or determine how individuals and businesses in those industries operate. In addition, certain industries require continuing education or training. More information about State of Oregon requirements can be found here.

Everyone doing business in the City of Portland is required to register their business. Within 60 days of starting a business in the city, a business is required to register (online, or using a PDF form to mail or fax). No payment is due with the registration form.

The license tax is 2.2% of the net business income. A business will need to file an income report (called the Combined Tax Return) each year to calculate the license tax. Apportionment may be allowed for business activity performed outside of Portland. The minimum annual tax is $100, but exemptions are granted for certain business types and income levels. The City of Portland also administers the Multnomah County business income tax. Information about the City of Portland and Multnomah County business taxes can found at the City of Portland Revenue Bureau here.