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Rhode Island Franchise Laws

How to Open a Small Business in Rhode Island (including Franchises)

The decision to start a small business in Rhode Island can be both exciting and unsettling at the same time. The good news is that Rhode Island has broken down the process to make it simple and easy. One of the most challenging elements of the process is figuring out the kind of business you'd like to open. After you've made your decision, everything else will fall into place, and before you know it you'll be well on your way.

Instructions

					1.	Create a business plan. A business plan will help to organize how your business will operate, enable you 
						to set financial goals and expectations, and provide you with a number of actions that need to be com
						pleted to advance your plan. You may want to consult a local organization, such as the local Chamber of 
						Commerce, that can connect you with an organization to help guide you through developing your business 
						plan.
				

					2.	Choose a location. To keep costs low, especially in the start-up phase, entrepreneurs will use a home 
						office or find shared office space with other entrepreneurs of a similar industry. Such shared work spaces 
						are called incubators. Your local Chamber of Commerce or the Rhode Island Economic Development 
						Corporation can help locate available incubator space in your community.
				

					3.	Obtain financing. A good business plan will help you estimate the type and amount of financing you'll need 
						to get started. Most traditional lenders such as commercial banks may want to see your business plan as 
						well as information about your personal finances as criteria for approving your loan. In addition, the state 
						provides financing, such as loans and grants for entrepreneurs and small businesses. Plus, there are 
						community organizations that offer micro-financing, loans of a few thousand of dollars to entrepreneurs 
						meeting certain qualifications. You can find out more information about micro-financing opportunities 
						through the Rhode Island Economic Development Corporation, which also administers a micro-business 
						emerging growth fund.
				

					4.	Register your business name with the Rhode Island Secretary of State's office. You can obtain a Fictitious 
						Business Name Statement from their website to complete as part of the registration process. Also, you 
						should be aware that if the name you register is the same as or similar to another business registered in 
						Rhode Island, you'll need to either change it or add the type of business to the name. For example, Fran's 
						Finances may need to change to Fran's Finances, LLC.
				

					5.	Declare your business type, such as a corporation, limited liability corporation or nonprofit organization 
						and register it with the Secretary of State's office. You'll need to provide a Rhode Island business address 
						at the time of registration. If you're unsure about what type of business to register as, contact a business 
						tax attorney in Rhode Island who can explain the advantages and disadvantages of each.
				

					6.	Obtain an Employer Identification Number (EIN) or federal tax identification number from the federal Inter
						nal Revenue Service. This number is used to distinguish your business from all the rest. You'll be asked to 
						provide this information for all formal dealings with lenders, the state and federal government and the tax 
						authorities.
				

					7.	Apply for a business license with the state Division of Taxation. Rhode Island has an online system to 
						register new businesses.
				

Tips & Warnings

Depending on the type of business you're starting, you may need to obtain operating permits. You'll want to contact a local business organization or check with the Rhode Island Economic Development Corporation to review permit requirements and other questions you have about starting your business.

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