Starting an Online Business in Pennsylvania
Pennsylvania is also known as the Keystone State, and it is home to diverse industries composed of companies that started from home, e-commerce businesses, and traditional companies. If you have a great idea and want to start an e-commerce business in Pennsylvania, then you will need to understand and follow the state’s small business guidelines. The following processes will help you understand the state and business-specific requirements, as well as the documentation needed for your online businesses.
1. Prepare your Pennsylvania online business idea and plan
The first and foremost area to focus on before you start an online business in Pennsylvania is creating a strategic plan. This will be your business plan and it’s a detailed outline that will set the course and determine the success of your online company. This type of plan refers to the starting phase, operational, financial, and marketing aspects. It’s important to remember that the plan should be designed based on the products or services offered. Because it will be based on the requirements of each e-business, no two plans can be similar. Some of the key components of the plan include:
- Business objective
- Business structure
- Mission and vision
- Short and long-term goals
- Defining risks
- Market research
- Competitive analysis
- Customer or targeted audience research
- Products and services
- Revenue model
- Logistics and Operations plan
- Internet marketing strategy
- Financial plan
2. Choose your Pennsylvania online business name
Once you have an online business idea, the next step is to register it with the state, which will allow you to become legally operational. Choosing a good business name is a chief requirement to become legally operational in the state. The name you select will not only be used to register your company in the state of Pennsylvania, but it will also serve other purposes such as banking, marketing, and booking a domain name among others. Here are some general tips for choosing the right name to start an online business from home in Pennsylvania:
- Keep the e-business name short, simple, and memorable.
- The name should have a connection to the product or services offered.
- To reserve the business name with the state of Pennsylvania, you will need to check the name availability.
- Follow all business naming guidelines as mentioned in the Pennsylvania Consolidated and Unconsolidated Statutes.
- Ensure the availability of the domain name for the chosen e-commerce business name.
Another important detail to consider is the type of entity structure you want to operate. If you plan to start an LLC or corporation, you can reserve a business name or even choose a DBA (Doing Business As) also known as a fictitious name.
3. Register your online business with the Pennsylvania Department of State
In order to make a business operational, you will need to apply for an online business license in Pennsylvania. However, it is important to register your e-business first. This process is known as a new business formation or incorporation and will vary depending on the type of entity structure you have chosen. So, if you choose to form a limited-liability company, then you will need to submit a Certificate of Organization or Articles of Incorporation for a corporation.
We at IncParadise are among the top reputable Pennsylvania registered agents in the state, and have a team of experienced professionals who can help you with the online business registration or incorporation process. We’ve helped many new business owners start an ecommerce business in Pennsylvania.
Start your online business in Pennsylvania today!
4. Obtain all necessary licenses and permits for your online business
Once you’ve registered your e-business with the state, the next step is to obtain the necessary online business license in Pennsylvania. Licenses and permits will help you to conduct transactions in the state and the licensing requirements and regulations will vary according to:
- The city or county you operate from
- The industry your business is based in
- Business activity
Some businesses may even be required to obtain professional or occupational licenses and permits. If you start an ecommerce business in Pennsylvania then you may also require a sales tax license. The Pennsylvania business licensing requirements (industry and local), regulations, and Pennsylvania business licensing and permit requirements are a complex and extensive application process. For this reason, IncParadise has created a “Business License Research Report” service to provide necessary assistance. This is a detailed report containing a list of filing instructions, supporting document requirements, and the fees for all business licenses and permits in this state.
5. Buy a website domain and build an e-commerce website
Choosing the right domain name is both essential and important when planning to start an online business in Pennsylvania. Your domain name is an integral part of your website’s address and you can use your state registered name for this. The name you choose for your domain will help your customers find your website. It’s important to ensure that the domain name is easy to remember and may even describe what the site is about. There are two ways by which you can obtain a domain name:
You can register the domain name yourself directly using a domain name service provider, or
you can outsource it to a hosting provider specialist to register it for you
Example: You are planning to start an online business from home in Pennsylvania that will be focusing on IT consultancy. The chosen name is Phili IT Consulting. Now you can use this name as a domain name like www.philiITconsulting.com or you can opt for something easier like www.philiIT.com. Of course, there is always the question of availability of a specific domain name as well.
6. Get an EIN and File your taxes
Apart from an online business license in Pennsylvania, another important requirement for most e-commerce businesses is to file your taxes. Your business activity, entity structure, and annual sales will determine the type of taxes you will have to file, and you will need an employer identification number (EIN) to do this. This is a type of Tax ID number that is issued for free by the Internal Revenue Service (IRS).
7. Open a bank account
If you want to start an e-commerce business in Pennsylvania, or any other online business that offers products or services then having a separate bank account is highly recommended. This account is known as a business bank account or checking account. Since customers will be submitting their payment online, you will need a payment gateway, as well as a proper bank account for receiving funds. The account will also help you with keeping track of your sales revenue and expenses.
One of the modern-day alternatives is a full-stack Neobank for startups called Cheqly. It’s a regular US bank account that you can start online from anywhere. This account allows you to transfer money quickly, easily, and locally in Pennsylvania, or anywhere in the USA and internationally.
8. Comply with taxes and other regulatory requirements
Once you start an online business in Pennsylvania, you will be required to comply with annual maintenance as well as tax requirements of the state. Some of the important requirements include:
- There are different types of taxes applicable in the state of Pennsylvania. The type of taxes that your e-business needs to file will vary according to the business activity and entity structure. If you start an e-commerce business in Pennsylvania, then one of the mandatory taxes that you will need to file is the sales tax. You may also be required to file personal income taxes.
- As a part of annual maintenance, you will be required to file a Decennial report. The laws will change soon, and you may be required to file an annual report each year starting from 2024-2025.
- Once you’ve obtained an online business license in Pennsylvania, it is important to maintain your renewal. The renewal time and fee may vary depending on the issuing authority or the county your business is operating from.
9. Market your business
Building a new business from scratch requires many strategies to work simultaneously and in sync to achieve success. If you start an online business from home in Pennsylvania, the next part of your strategy should be to focus on marketing the services, products, or the brand itself. You will need to contrive a plan that will help drive customer traffic to your website or online store. Some of the important areas to focus on include:
- Using search engine optimized (SEO) content.
- Create a strong email marketing strategy while continuing to build your email list.
- Boost your digital engagement by using different social media platforms like YouTube, Instagram, etc.
- Use of Mobile commerce (m-commerce) to reach out to the targeted customers.
- Use Google Ads for search engine marketing and advertise on various social platforms.
- Create meaningful partnerships with other brands to enhance cross-promotion.