This editorial is for you if you’re beginning to wonder what it did take to establish a company in India. Establishing a company in India, as with any other country, necessitates a solid legal foundation and a long-term business model. Here are the things you need to keep in mind when starting a business.
It is worth noting that the business environment in India has steadily improved in recent years. Favorable reform efforts, even by the Indian government in just a few key areas are among the factors that influence this positive change.
Decide on a business entity:
The next stage is to determine the kind of corporate entity that will help you expand and speed up the expansion of your firm once you’ve developed a business concept and have completed the necessary market research. You will gain a better understanding of where and how to save taxes as a result of this choice.
The following list of business entity kinds includes a variety that you can select from:
- One Person Company
- Sole Proprietorship
- Private Limited
- Limited liability company (LLP)
- Public Limited Company
This is one of the most important things you need to keep in mind when you start a business.
Select a Location
Henceforth finishing the first stage, you must decide where in India you want to locate your company. The most accessible approach to achieve this is to select a region or a town with supportive laws for starting and growing enterprises. In India, the majority of enterprises are normally found in officially designated industrial or commercial zones. Subsequently, the property listings for the industrial and commercial zones in the region where you intend to open a business are a good idea.
Gujarat, Hyderabad, Punjab, Haryana, Tamil Nadu, and Andhra Pradesh are the top six Indian states for ease of doing business, according to the Business Reform Action Plan (BRAP) 2020 report. 15 business regulation categories, including Access to Information, Labor, Environmental, Land Development & Transfers of Property and Land, Utilities Permits, and others, were covered by the 301 reform points used to conduct the assessment. These ought to be just a few factors you should consider while deciding where to locate your company.
On the other hand, accessibility to the ecosystem, which includes potential employees, partners, the supply chain, etc., is one of the most crucial factors when deciding on a location. Hence, bear those things in mind as you choose the site.
This is another of the most important things you need to keep in mind when you start a business.
Open a Bank Account in the Business’s Name:
Subsequently, once your firm is established, it is imperative to register a bank account in its name. One-person companies, private limited companies, and limited liability partnerships (LLP) are examples of business entities that can create a bank account by submitting their certificate of incorporation and the founding member’s PAN card.
You must pick a bank that offers advantages to startup companies as a business owner. It is advised to create a bank account with a nationalized bank, for instance, if a company needs a bank loan for early working capital. What are the benefit? Unlike private banks, nationalized banks are much more likely to lend to startup companies.
Several banks are welcoming new businesses and providing banking services that could be helpful in the short- to medium-term.
Registration and Licenses:
It is crucial to register your company with the relevant government agencies. Please be aware that according to the makeup and entity type of the company, the registration procedure may vary.
The following registration forms and permits are essential for starting a business in India:
- Business name
- Incorporation certificate
- Certificate issued under the Office of the Inspector, Shops, and Establishment Act
It is crucial to keep in mind that the above list is not all-inclusive, and according to the nature of your business, you may need various sorts of registrations and licenses.
Set up a capital:
There are various ways to raise money for your business besides bootstrapping. These alternatives include venture capitalists, bank loans, bank incubators, crowdfunding, angel investors, and crowdfunding platforms. By creating a thorough business plan that includes financial estimates, organizational management, trend analysis, and sales and marketing tactics, you may win over investors. In addition to all of these choices, you may always self-fund your firm.
Starting a company in India could be challenging, and it’s easy to get lost. Although the nation has previously come under fire for its harsh and negative policies, things have changed. On the World Bank’s “Ease of Doing Business” index, India currently ranks 63rd out of 195 nations, a major improvement from its 134th position in 2013.
We recognize that even after beginning a business in India, you could still need some assistance. At Scalix, we work hard to support business owners and founders in overcoming the initial challenges they face. To easily create a profitable and scalable business, get in touch with us.