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8 Min. Read

How to Start a Small Business in Ontario

How to Start a Small Business in Ontario

Are you dreaming of owning your own business in Ontario? It’s a big step to take, and there is a lot of work involved. But the rewards of being your own boss are limitless. We’re here to help you transform your dream into a reality.

Our guide details how to start a small business in Ontario. With our insights and direction, you will be well on your way to becoming a success.

Here’s What We’ll Cover:

Start with an Idea

Take Advantage of Social Media

Starting an Online Business in Ontario

Starting a Physical Business in Ontario

Register Your Name

Licenses and Permits

Getting Operating Capital

Key Takeaways

Start with an Idea

Generally speaking, most small business start-ups either sell products or provide services. Some small businesses can even do both, but it’s usually best to start with one first and then move to the second area as you grow and gain a foothold. Consider what type of business best fits your interest level and skills. Then, focus on getting that business up and running.

When you come up with a business idea in Ontario, it may help you discuss your ideas or discuss the process with others who have experienced it. Your local BBB (Better Business Bureau) may help you find other small start-ups in your local area. And they can help you develop your business ideas.

You can also connect with other Canadian small business entrepreneurs. Some of the best ways are through Facebook and other social media platforms. As you become an established business owner, you will have an easier time attracting potential customers.

Start-up, Franchise, or Buy a Business?

With a start-up, you start it all from the ground up. This includes developing your product or service and acquiring customers. If you buy into a franchise, the groundwork is already there for you to build upon. And if you choose to buy an existing business, you simply take over operations.

As you have probably already guessed, some can cost more than others. If money is a big factor in starting your own business, you want to consider which option gives you the most breathing room.

Physical or Digital?

Another very important factor is how you want to run your business. Do you wish to run operations from a physical brick-and-mortar store or via an e-commerce company? If you’re passionate about maintaining a presence in Ontario, you may want to run a physical location.

Many start-ups are opting for online-only services. Depending on what you offer, you could feasibly run your e-commerce company from your home. This would save you a substantial sum of money in building costs, overhead, and so on.

If you sell products online, your website will be your storefront. Therefore, people will visit your website to buy your products or services instead of owning a physical store.

Take Advantage of Social Media

In this day and age, you can’t compete without a strong social media following. Every successful company has a department devoted solely to building a social media empire. If you haven’t already tapped into social media, you’re missing out on a viable marketing outlet.

When you have a social media account that works in your favor, you will gain new clients and grow your business. But there is an art to making social media work for you. You might have a knack for attracting followers but just don’t know it.

The key is to be creative and strive to capture the attention of consumers. Know your target audience and craft your marketing plan to cater to them. And on occasion, you can run campaigns that reach out to untapped demographics.

Social media allows for all sorts of marketing ventures. And it pays to take advantage of all that it has to offer. What’s more, don’t settle on just one social media platform. Try as many as you can and use them to their fullest extent.

But be sure to have the resources to manage online customer feedback. If you get a bad review, you need to be able to address it professionally, as both good and bad input travels fast online. And you may want to hire someone to manage your social media affairs.

Starting an Online Business in Ontario

It’s understandable that some small business owners are better at social media and operating websites than others. If you need to hire someone to help you in these areas, it will be a good investment.

For a small business, the importance of having a strong and professional online presence can hardly be overemphasized. If you don’t have a trusted online appearance, customers will almost certainly pass by you, and you won’t know why.

You may also need to hire someone to handle website and social media updates. This will ensure that customers stay engaged and have a reason to follow your business.

There are many things you will need to do to start an online company. Let’s look at a few:

  • Decide to operate either from home or elsewhere
  • Manage customer questions and requests
  • Develop written copy to drive sales
  • How much inventory do you need?
  • Find ways to increase web traffic
  • Find the best shipping option
  • Track customer engagement
  • Build e-commerce website

The Ontario government has a website that features a wealth of online resources that can help you with these points.

Starting a Physical Business in Ontario

Just as with an online store, running a physical store requires much consideration. Let’s examine a few key points that require your attention.

  • Get licenses and permits to run your store
  • Market your brand to attract customers
  • Design building exterior and interior
  • Choose a building to buy or rent
  • Decide how to store inventory
  • Order operating equipment
  • Open local utility accounts
  • Buy liability insurance
  • Hire employees

Ontario also has its own resources for starting a physical business. Check with the local government for tips on getting your business license, permits, and other essentials.

Register Your Name

Ontario’s government website has a portal that lets you register a business name. You can also search through existing business names to make sure you choose something that’s not already in use.

You will also need to register for tax-related purposes. In doing so, you will get a BN (Business Number) from Canada’s Revenue Agency. You must have your own BN to track and manage your business’s tax payments.

You can get your unique BN by phone, online, mail, or fax. Also, you may need to register with the following:

  • Income tax program for corporations
  • Importing and exporting program
  • Payroll deductions

Some may apply to you, and others may not. The Revenue Agency can assist you in determining the other necessary registrations.

Licenses and Permits

Ontario has a free government resource for obtaining the proper documents. New start-ups must ensure that they get licenses and permits before going into business. Known as BizPal, you can search through the requirements for starting a business in Ontario.

From there, you can proceed to get the licenses and permits needed in the province. What’s more, you can narrow down your information by your industry and business types.

Moreover, there are some regulations in the province that may apply to you. It’s important that you are aware of these regulations and how they might affect your business operations. The Ontario federal government has a registry of these regulations.

You can search through them to determine which ones apply to you. From there, you can take appropriate action to ensure you are in compliance.

Getting Operating Capital

One of the most important steps in starting a business is getting the money needed to begin operations. You can find financing options through various resources. The most common methods of start-up financing in Ontario are as follows:

  • Government subsidies
  • Supplier trade credits
  • Government grants
  • Venture capitalists
  • Friends and family
  • Private bank loans
  • Personal finances
  • Other businesses
  • Angel investors
  • Capital leasing
  • Private credit

Some of the secondary funding options include:

  • Crowdfunding
  • Lines of credit
  • Secured loans
  • Credit cards

If you end up going through financial institutions, consider putting up collateral. In doing so, you can lower your interest rate. This will also increase your chances of getting approved for the loan. But you want to be sure not to default on your loan.

If you do, you will lose your collateral, which is often property and assets. It’s a good idea to have a backup plan in case you don’t bring in revenue at first, such as friends and family. Paying the bank is imperative to ensure that you don’t lose your investment.

Key Takeaways

As you begin your small business journey, it is important to make sure you have the tools and resources to assist you along the way. With FreshBooks, you can easily manage your business’s assets, inventory, accounting and more.

And with FreshBooks’ powerful accounting tools, you’ll never struggle to manage your finances. In the meantime, we encourage you to visit our Resource Hub. There, we offer tips on running a small business, including taxes, business name registration, and much more.