How to Start a Business in South Carolina in 11 Easy Steps

Starting a business in South Carolina is an exciting opportunity to bring your ideas to life in one of the most affordable and business-friendly states in the country.

The Palmetto State’s growing economy, low cost of living, and supportive regulatory environment make it a great place for entrepreneurs to get started. Forming a business here is straightforward and inexpensive; in most cases, you can file directly with the Secretary of State’s Office online and receive your Certificate of Existence within 24 hours for just $10.

Corporations, LLCs, nonprofits, and partnerships all register through the state’s Business Filings Online system, which also lets you make changes to existing entities or access certified records. Sole proprietors and general partnerships don’t have to file with the Secretary of State but may still need local licenses or permits depending on their business type.

So, if you are ready, let’s go on and learn how to start a business in South Carolina:

1. Fine-tune your business idea
2. Create a business plan
3. Choose a business location
4. Decide if you’re an online-only business
5. Choose a business name
6. Choose a business structure
7. Set up banking, credit cards, and accounting
8. Get funding for your Montana business
9. Get insured
10. Obtain permits and licenses
11. Find your team
12. Market and grow your business
13. Open the doors!

1. Fine-tune your business idea

If you acted on the suggestion that you note your initial business ideas on paper, these notes are your starting point. Not all ideas are viable, but after you have given some serious thought to the type of business you want to start, you will most likely research several different possibilities. Whether you decide to start a product-based business, a service-oriented company, or even a combination of the two, the need for research is paramount. You must determine if there is a need for such a business in your state, region or local area. Once you have confirmation of that need, or you are certain that an opportunity exists for the product or service that you envision, you can proceed to refine your ideas and decide on a structure for your business.

Your success depends on it. 

For instance, if your idea is to start a homemade dog-treat business, be prepared to answer the following basic questions: 

• How many dog owners are there in the targeted sales area?
• Are there other local businesses that offer homemade dog treats?
• How much do commercially-produced dog biscuits and other treats cost to buy?
• Can you determine the raw materials and time they would require to produce?
• What are potential sales outlets? Are there farmers markets or co-ops that you could join? Would veterinarians and grooming facilities be possible sales venues for treats?
• Are dog treats viable as a home-based business, or are dedicated production facilities necessary?
• Are licenses, permits and inspections required?
• What are the projected costs to produce, market and sell the treats, and what sales volume would be needed to result in the income you want? 

2. Create a business plan

Your business plan is like a three-legged stool. The following are key elements of a successful business plan:

Market research

Identify similar businesses, both in your area and in other locations, even in other states. Browse websites and advertisements run by similar businesses and keep a file of potential competitors for your product or service. Be sure to analyze the local market, and make projections regarding sales, pricing, and volume needed to sustain the business, as well as the startup capital and the financial cushion needed to sustain the first few months of operation. Remember, that it is easier to fill a need for a specific product or service than it is to “create” a need.

Try to fill a void in your market area.

Financial plan

Whether you have a cash “nest egg” earmarked for your new business, sufficient credit to secure funding, or plan to rely on the generosity of friends and family and business growth to sustain your efforts, you must be realistic about costs and the cash inflow-outflow that will be needed for the first six to 12 months of operation. Current estimates are that 20% of new businesses established in the United States fail within the first year. Inadequate starting capital is one of the top reasons, but not fully underestimating the market, not filling a real need within the community, and not anticipating potential problems are contributing factors.

Marketing plan 

A new business must devise a way to reach potential customers. Word-of-mouth advertising is not sufficient to promote substantial new sales or long-term business growth. A new business owner cannot depend on friends and family to spread the word about the business. Growth and long-term success will depend on your marketing efforts. Consider the following as initial steps:

• Plan a “Grand Opening”
• Join the local Chamber of Commerce
• Create a website
• Become active in a trade association or civic organization
• Offer incentives and/or periodic discounts to return customers
• Network with other business owners in your community

There are many other options open to new business owners, but know at the outset that your marketing efforts extend beyond opening day and are an essential ingredient for the growth and long-term success of your new business.

Choose a location

Your location, if you have a physical presence, can make or break your business. If your business relies on “walk-in” traffic or requires dedicated parking for a number of vehicles, be sure to choose wisely, with a look to the future. Check zoning laws and specific requirements for signage and occupancy, if applicable. Some communities, for instance, prohibit specific types of business within specific distances from a school or religious institution. 

In general, South Carolina has minimal zoning requirements in most areas, but be sure to check with local authorities before assuming that a specific business will be allowed in a specific location. As an example, zoning restrictions might prohibit opening a retail store in a residential area. In the same vein, if you plan to manufacture a product or your operating hours require being open at odd hours, there may be local restrictions. 

Extensive research can be time-consuming, but it can eliminate problems and setbacks you might face in the future. Always plan for growth, even if your goal is to remain a small, local business.

Finally, it is always wise to check personally with local authorities before embarking on a search for a business location. Do not rely on a real estate agent or a leasing representative for definitive guidance. 

Should your business be online? Or online only?

Many businesses today can have a single physical location — an office, a storefront, or even a mobile location such as a food truck — but many types of business benefit from having a website, or an online sales site, in addition to a physical address. Think about the benefits and possible drawbacks of each before you either jump into a quick decision or decide to eliminate one or the other.

Know that an online presence requires, at minimum, the following:

• A Website that is easy to find and navigate online.
• Social Media Presence
• A Supply and Distribution Plan: Investigate the best strategies to make online sales, to process payments, to initiate and maintain effective customer contacts, and to deliver goods or services to your buyers. 

You will also want to investigate if state-specific regulations exist that apply to an online business as well as the tax laws and reporting requirements that might differ for brick-and-mortar operations and online marketing.

3. Choose a business name

If you’ve heard that a business is only as good as its name, that may be a simplification, but it’s at least partially true. Names and logos identify a business to its customers, but they do not necessarily have to include the specific product or service in the name. Although names like Buddy’s Barbecue or Joe Smith Auto Repair may be descriptive, they are also, in a sense, a limiting factor. If the barbecue joint plans to expand its offerings to include home-baked pies, should it change the name? 

In the Palmetto state, conduct a simple South Carolina business entity search to determine if a name you are considering has already been taken. If you develop a list of several possible names for your business, conduct an informal survey of friends, family or associates to determine the reaction. Then, proceed to officially register your selection with state authorities, and continue to develop your business plan.

Today’s ideas regarding “branding” also deserve serious consideration when naming your business.  

Jeff Bezos, founder of the corporate giant, Amazon, shares an important message about naming a company. It’s not the name itself that’s important, he insists, but the impression that other people carry about the name. And that impression is built on product value, price, consistency and delivery of the product or service. In short, Bezos states, it’s “what people say about you when you’re not in the room.”

Put another way, it’s the business following that you build over time, through performance, and by delivering on your promise of quality, service and lasting value, whether you’re selling donuts or farm equipment, fixing teeth or cutting hair, completing tax returns or designing jewelry. 

Remember, that you want repeat customers, not simply one-time sales, so pay attention to the reputation (the brand, if you will) that you build. All printed or digital sites should reflect your brand, using the same colors and graphics that you use for signage, business cards and promotional materials, even office decor. The more distinctive your brand, the better-known your business will become and public image, in today’s world, can be a primary factor in business success.

4. Choose a business structure

Starting a business in South Carolina can be as simple as picking a catchy name and filing a South Carolina DBA. However, if you seriously want to maximize the potential of owning a business in the state that will provide future income for you and your family, or if you want to hire employees, grow the business, and make a lasting impact in one way or another, you should investigate other, more structured business entities.

Each form of business has distinct advantages, drawbacks, and tax consequences. So, whether you choose to become a sole proprietor or want to grow a large corporation, it is wise to investigate the different requirements for establishing a business identity as an individual, a partnership, a limited liability company (LLC) or even a non-profit corporation. 

If you’re considering forming an LLC in SC, you’ll benefit from personal liability protection, flexible management options, and straightforward filing requirements through the South Carolina Secretary of State.

Some business entities are designed to live for generations as family enterprises, while other publicly-owned business may become national or international business entities. 

Investigate your South Carolina options and gain a better understanding of state requirements here.

Know that the tax advantages and reporting requirements will vary based on the business structure you choose.

5. Set up banking, credit cards, & accounting

Just as you manage your daily, monthly and annual finances as an individual, you will want to have a financial advisor to help you set up banking and credit accounts. Hiring a tax advisor and accountant on retainer can be invaluable when starting out in business. If you’re doing the planning on your own, consider consulting with experts on an annual basis.

One important word of advice is to never mix personal funds and credit resources with business accounts. Not only might it cause financial woes, it could even be deemed unlawful.

6. Secure funding for your business 

Depending on the type of business you envision, investigate possible small business grants in South Carolina and loans available for specific startup ventures.

Never forget that profitable ventures begin with inventive ideas, and if you have a dream, pursue it.

But also don’t forget to consider that advice offered free of charge is often worth only that much. Always seek out reliable advisors.

7. Get insured

The most common type of insurance for South Carolina business owners is a general liability policiy. However, there are other types of insurance a small business should consider, depending on the type of business, your business assets, including buildings and automobiles, and your profession. 

If you have special needs, be sure to get quotes for professional liability (E&0), commercial property, and specific coverage for protection in specific industries such as construction, food and beverage operations, healthcare or childcare, and newer retail and E-commerce fields. 

If you hire employees, you will need to purchase workers’ compensation and unemployment insurance.

8. Obtain needed permits & licenses

The need for a specialized business license South Carolina varies from one jurisdiction to another. Because requirements are highly localized, it’s important that you check the requirements in any county or municipality you might consider for your business. Comprehensive and detailed  information about local licensing and permit requirements in the state is available through this easy-to-navigate website. 

There is no such thing as a statewide business license in South Carolina.

Federal income tax and local tax in South Carolina

File a federal income tax form and make sure you comply with South Carolina’s local tax requirements. Consult with an accountant familiar with local regulatory requirements, and always seek professional advice to assure compliance with state filing procedures and possible changes to the law from one report period to the next.

Determine if specific regulations exist in your area by consulting with local authorities, since requirements may differ from one jurisdiction to another.

9. Find your team 

No matter what the specific focus of your planned business endeavor might be, you will likely want to take advantage of other experts in the field, or perhaps hire employees to perform necessary tasks to keep the business running. 

The people you hire or consult with are vital to your success. Choose carefully, both when deciding on your specific needs and when interviewing potential employees or selecting advisers and consultants for in-depth guidance and expertise. 

If you plan to hire others to work in an office or as creative product developers, seek guidance from wage and hour specialists and be certain you understand and adhere to both federal guidelines for withholding and depositing withheld income and taxes, unemployment insurance, and the specific South Carolina laws and regulations that govern hiring, payroll, reporting, and discrimination. Such information is readily available online through the state departments of licensing and taxation, but the regulations can be detailed and sometimes complicated. Don’t hesitate to seek expert advice, or hire a consultant for advice. Any fee you pay is likely to save you money in the long run.

Always examine the qualifications and examine the credentials of anyone you enlist to give advice on state law, regulations and compliance.

As a start, visit the South Carolina Department of Revenue site on Taxes and Licensing for information.

Learning about compliance with the state’s payroll requirements and reporting is not difficult because, in general, South Carolina corresponds with federal requirements for withholding and unemployment accounts. Businesses with employees, or those that plan to hire employees in the future, must secure a Federal Employer Identification Number and register with the state’s Revenue and Employment Department to establish the appropriate withholding and unemployment accounts. South Carolina also has some payroll and HR regulations that businesses must follow. 

South Carolina payroll requirements are relatively simple, as most of its regulations align with federal labor laws. In addition to a federal ID number, you’ll need to register with the South Carolina Revenue and Employment Departments to establish withholding and unemployment accounts. Besides tax registrations, there are a few payroll/HR regulations to be aware of. All transactions having to do with payroll withholding must be documented and properly maintained and reported. 

In addition to required federal withholding for Social Security and Medicare, employers must withhold for taxes and unemployment insurance based on an employee’s status, and those funds must be properly reported and deposited on a timely basis. South Carolina employers must also withhold and make deposits to a state unemployment tax account each pay period.

South Carolina also has a state income tax, and employees are subject to payroll withholding by employers based on both income and location. As you may surmise, professional help can be invaluable when opening a new business or planning to hire employees for the first time. Payroll compliance software is a necessary management asset, no matter how small your business team may be.

However, as daunting as adherence to state-specific regulations may seem to a new business owner, hiring a cohesive team may be the most important ingredient in the success of your business. Don’t skimp on the asset advantage you gain with team players.

People form the backbone of any business

Seek advice from friends and family who have started or owned businesses of any kind. Turn to those who have achieved success with similar startups for advice about how to locate the right people, how to interview prospective employees, if pertinent, and how to communicate your needs and build loyalty among your associates and co-workers.

Hire contractors with specific expertise

Even if you don’t plan to hire employees at the outset, no business truly ever operates as a “one man” or “one woman” show. It is important to have a list of talented, experienced experts you can call upon for advice, from an accountant to a legal representative, a product expert if you plan to specialize in goods rather than services, even technical advisers to help develop your website, establish an online presence, or devise and monitor workable payment, processing and product delivery schedules. You might also want someone in the store or office who is available to respond to questions and handle possible disputes.  

If you plan at the outset for anything that might go wrong, your chances of averting a crisis are maximized.

Also, consider hiring an accountant or tax advisor as a consultant or on a retainer to assist with managing your financing and tax compliance issues. The best advice ever given to a fledgling business owner is to “keep straight with state and federal taxation and revenue departments.”

10. Market & grow your business

Study marketing trends, on the local and national level, and capitalize on the wealth of information and data that is accessible online relating to your business model and related products and services. It matters little what the product or service is; you are bound to find interesting information from a variety of sources, whether its news, opinion, new discoveries or updated sales statistics. People are always interested in learning more about the products they use and/or desire, lifestyles and developing trends.

Invite customers to invest in your company’s product or service as a gift item

While you don’t want to overload your buyers or clients with mailings they might only glance at and toss, try to keep them informed about new products or services that you plan to introduce, especially if they coincide with holidays, special celebrations or gift-giving occasions. If you offer bookkeeping or tax-return services, you might be surprised at the number of parents who would like to gift their adult children with a complimentary consultation. An equal number of your customers might purchase duplicate items to keep on hand for a special occasion gift-giving. 

Consider making special offers to attract initial customers

As mundane as it may seem, a “Grand Opening” with a 10% off discount on purchases, or a Ribbon Cutting ceremony, with a small gift for the first “X number” of customers not only announces a new business to its community, but attracts public attention. Consider such easy promotions as an easy way to gain attention and celebrate your new business. If you have a local newspaper, invite a reporter and photographer and then capitalize on the event by placing an ad in the paper.   

Investigate collaborating with other local businesses or brands

Although it may seem counterintuitive to collaborate in any way with your business competitors, it can be extremely rewarding, particularly if you’re a provider of professional services, or offer a distinctive product for sale. 

If you’ve heard the phrase, “A rising tide lifts all boats,” you may understand the wisdom of offering support to others in similar business endeavors to yours. That’s the basis of trade associations, medical research, and consumer protection agencies. What is beneficial to one is of benefit to all.

You’ll likely find more support for your own business endeavors when you offer support to others in your community or a similar business field.  

Invest in word of mouth promotion

“Happy customers attract each other.”

That is time-tested advice, and there are many ways to take advantage of positive reactions to your products or service. Here are just a few:

• Ask new customers for a review of a specific, unusual or newly-introduced product or a testimonial regarding exemplary service. Feature those positive comments on your website, through advertising or in a newsletter published for customers. Be sure to get permission to use names or customer photos, however. 
• Offer periodic discounts, two-for-one offers or one-time bonuses for repeat purchases.
• Initiate a simple rewards plan for buyers who reach a certain monetary level of spending with your business. Tailor the reward to the type of product or service you sell.
• Institute a “Buying Club” that friends and neighbors can join, and offer unique rewards for membership, perhaps a free product for reaching a certain level, or a donation to a community group, or even a quarterly reception special recognition for certain customers.

Create unique, helpful content to showcase your business 

If you have a website, you have a perfect opportunity to showcase your product or service with interesting posts on how to maximize the benefits of whatever it is that your customers or clients purchase, use or consume. If, for instance, your business sells gourmet cooking products and/or kitchen utensils, ask a local chef for recipes and advice on how to use those items in a home kitchen. 

Alternatively, find a guest blogger who writes about similar products and services, and create a monthly blog featuring helpful information.

11. Open the doors! 

Plan a successful launch event

If you’ve read the above sections, you should have the necessary basic knowledge, information and enthusiasm to proceed with your plan to establish a successful new business. As a reward for the hours of planning and organization, schedule a launch party that not only opens your doors — literally — to the public, but also figuratively acknowledges your business existence and your determination to succeed.

Celebrate that milestone. 

Land your first sale

Don’t hesitate to celebrate that first sale, but don’t go overboard. Accept it as the reward for all the planning and hard work you have expended to get to that point. Take a deep breath, and move on.

Conclusion

Now that you’ve completed all the steps, all that’s left is to continue to build on the effort it took to open those doors. Resolve to follow best practices, keep regular hours, maintain high standards and always treat your customers, clients, and coworkers with respect. Be attentive to any possible problems and solve them quickly, build your brand, cooperate with business associates and establish working relationships with competitors, service your customers and guard your reputation to spur future growth and development. The success you achieve is based on these first efforts, so use the launch event and view your first sale, whether it’s payment for a shiny, new widget or an extended contract with a client for services to be rendered, as a stepping stone to a secure future.

If you’re still in the early stages of planning, you can explore how to start an LLC to establish your business legally and protect your personal assets, or look into small business grants that can help fund your next phase of growth. The success you achieve is based on these first efforts, so use the launch event and view your first sale, whether it’s payment for a shiny new widget or an extended contract with a client for services to be rendered, as a stepping stone to a secure future.

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