Are you thinking of starting a T-shirt business? Or leveling up your hobby of printing shirts for friends to start earning money? If you’re ready to make it official, there are some things to think about.
This information was recently featured in the Summer Issue of Make It Magazine.
Things to consider when turning your hobby into a real business
By Shauna Soom
Printing shirts for family and friends is great, but maybe it’s time to earn some money? If you’ve ever thought of taking your hobby to the next level, here are some areas to consider as you get started.
Location, location, location
Overall, one of the best things about a t-shirt business is you can run it from just about anywhere. Are you working from your home? Do you a storefront? Do you sell online from a warehouse? However, your business location will determine the taxes, business regulations and laws that you need to follow.
Your name is everything
Admittedly, it may have taken you a long time to settle on the right name. Now that you have a name that fits, you will want to protect it. An entity name provides state level protection, and a trademark protects you at the federal level. To protect your new website, obtain a domain name.
Select your business structure
This decision is best made with advice from your attorney and accountant. The structure of your business will affect your personal liability, how much you pay in taxes, your ability to receive funding. Even the annual paperwork filings are based on business structure.
Register your business
The type of business registration will be determined based on your location and business structure. Even if you have a sole proprietorship, you will probably want to consider filing a DBA. DBA stands for “doing business as,” and you’ll file a DBA when you want to conduct business under a name of your choosing and not your legal name (John Doe).
Obtain licenses and permits. Yes, even when operating from your home
The company location determines the licenses and permits needed to operate your business. Retail locations often have local regulations and licenses for operation.
Apply for tax ID numbers
An Employer Identification Number (EIN) is also called a tax ID number. You can get one through the IRS. This number is necessary to pay taxes, hire employees, open a bank account, and apply for licenses and permits. You may also need a separate number from your state.
Open a business bank account
Best business practices are to keep your personal and business spending separate. Most businesses have at least a business checking account. From a brick and mortar bank to one that is only online, there is a banking service mix that is best for your operation. Consider a merchant service account for customer credit and debit card transactions. Check with the Small Business manager at your local bank branch. They are usually very helpful.
Protect your investment, get business insurance
Check with your homeowner’s insurance company first. Your homeowner’s policy may cover your home-based business. If your business is off-site, you may need a separate policy. A business policy protects your business’ assets and property from damage, theft, vandalism, and lawsuits. If you have employees, some insurance is legally required. This includes workers’ compensation and unemployment.
Ask For Help
It goes without saying that starting a decorating business is exciting! Most communities offer help to ensure you make good decisions for the successful operation of your new venture. The SBA Small Business Development Center program is one example of these resources. SBDC’s provide counseling, training, and technical assistance to new and prospective business owners in every state. Most of the services offered are low or no-cost. For details on where to access this program in your location, visit sba.gov and look under local assistance. Your local bank probably has a team member that can walk you through many of the financial set up procedures.
Join an Online Community
Last but not least, don’t forget you’re not alone. You should also consider joining an online Facebook community for t-shirt decorators such as Stahls’ Heat Press for Profit Facebook group. Everyone helps each other and you have access to great information and resources.
For more information about starting a T-shirt business, this video can be very helpful. It features Josh Ellsworth and has over 1 million views.