This section of the forum is for discussing the business and finance issues of the t-shirt industry. Which business structure to use (sole proprietor, LLC, S Corp, etc), how to handle billing, where to register your business and get the proper licensing, etc.
I think I finally have a new design that has serious potential for my target market. Its a original, funny, Obama shirt (no slandering involved). Ive been planning and designing up to this point, but haven't quite yet legally established my business, and looking for advice. Have a total of 8+ designs.
I have the name picked out, and its available, thats not a prob. Going with LLC for some protection from personal assets, even though right now im the owner and only employee.
Im probably going to register online, and get my tax id/EIN through the same company online (thinking LLC.com). But im unsure of where do I go from here.
Will the name be somewhat protected once this happens, until I decide to trademark the logo/name. I feel like im missing something. Located in NJ if it matters. I'll be looking at approaching a rather popular department store(for lack of better name) and don't want them to steal the idea, design, etc.
You should be ok. But, if nothing else you could do the "old school" method of copyrighting.
Just stick the design (paper print out) in a manila folder, seal it and mail it to yourself. Never open it. Stick it in your safe or a safety deposit box. If someone ever takes your design, you can take them to court and prove that the image/design is yours by the postage date stamped on the folder.
I used to do that with all of the songs I ever wrote. I would put the recording on a CD and type the lyrics on a piece of paper.
I've heard about that hellbound, but also heard thats a myth. But I would believe it would give you some protection.
On top of things, a friend said he LLC'ed for $150, and Im seeing prices of $150, $250, and $399 online.
After calling them up and talking they said its going to cost $550 for everything! Wasn't planning on that, for those that LLC'ed, what did it run you, TAX ID/EIN included?
You should be ok. But, if nothing else you could do the "old school" method of copyrighting.
Just stick the design (paper print out) in a manila folder, seal it and mail it to yourself. Never open it. Stick it in your safe or a safety deposit box. If someone ever takes your design, you can take them to court and prove that the image/design is yours by the postage date stamped on the folder.
I used to do that with all of the songs I ever wrote. I would put the recording on a CD and type the lyrics on a piece of paper.
As has been stated many times here on the forums, it is most definitely a myth and offers absolutely no protection whatsoever.
It is too easy to fake, and will not be allowed in court.
Its a original, funny, Obama shirt (no slandering involved).
If your company name has to do with obama, I'm not sure you'll be able to trademark it.
Hopefully, your company has designs that expand beyond the political election, as that is a very time sensitive market.
The best way to market those political t-shirt designs is fast. Through a service like Zazzle or CafePress where you don't get tied up in inventory and you have the potential to get your designs out there to people that are already searching for those products. There's a lot of competition in that market.
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I'll be looking at approaching a rather popular department store(for lack of better name) and don't want them to steal the idea, design, etc.
You can try copyrighting the design, but if it's using someone else's face, that may be a challenge.
Even if you do copyright the design, anybody can still steal it if they want to. Copyright just gives you legal recourse if you have the funds and desire to take the matter to court.
If your company name has to do with obama, I'm not sure you'll be able to trademark it.
Hopefully, your company has designs that expand beyond the political election, as that is a very time sensitive market.
The best way to market those political t-shirt designs is fast. Through a service like Zazzle or CafePress where you don't get tied up in inventory and you have the potential to get your designs out there to people that are already searching for those products. There's a lot of competition in that market.
The company name has nothing to do with Obama, and has many designs not tied to politics. This is just one shirt idea I thought was good enough to create, and it would get attention and draw attention to the brand as a whole. Cafepress is an option, but quality, softness, and print softness are all an integral part of the brand, and what I am hoping offers a strong selling point to set us apart.
I know someone can take the image we use, and its not the image that makes the shirt but rather the idea/phrase that it is based around.
An LLC is a flowthrough entity and all profit will be taxable income to you although the IRS has refused to rule on whether you have to pay payroll taxes on your profits. Also, you are denied several important benefits as an LLC that you would get as a C-corp. To name a few, a C-corp can give virtually unlimited tax free benefits such as paying for all of your non-covered health care (out of pocket expenses), retained earnings (allows for the corp to keep money and have you not be taxed on it), dividends (you don't pay payroll taxes on it and are taxed at a lower rate on income taxes), and the ability to have a different fiscal year than the calendar year.
In any case, you are taking the right path in setting up a real business identity to get going.
Glad to find out the EIN is free, but after looking at irs.gov I don't even know if I need it. For one, im hte sole owner, and sole employee, no one else works for me, so it may just be wasted time. On the other hand it seems it may be easier to set up wholesale accts. rather than use my social.
Glad to find out the EIN is free, but after looking at irs.gov I don't even know if I need it. For one, im hte sole owner, and sole employee, no one else works for me, so it may just be wasted time. On the other hand it seems it may be easier to set up wholesale accts. rather than use my social.
1) DON'T pay somebody to make you an LLC. I live in Florida and did mine online for $160 - for EVERYTHING! Just go to your Department of State web site and do some looking around. There should be links there somewhere regarding State corporations, LLC's, etc.
2) Be safe and get a Federal EIN. It costs nothing, and a lot of suppliers won't let you open an account unless you have one. You'll also need it for your business checking account.
3) If you start out as an LLC and find it's not what you need, you can always have your accountant (yes, make sure you have an accountant!) make the switch to a corporation. From what I gather, it's not that complicated.
I'm just starting out as well and I my first piece of wisdom is exactly what your're doing...READ-READ-READ! Here is what I have done:
1. Trademarked my name: Cost, $375. If you are smart (and clearly you are since you know how to maneuver your way around the internet) you can do this yourself. Save the money, don't use a lawyer until you really need one.
2. Buy the domain name. Pick your choice, but please read the thread about unethical practices being done.
3. LLC can be done yourself. I see New Jersey has a very nice business section of their website. In Michigan it cost me $50; company searches can be done online.
4. I opened a shop at CP, bought my own shirts to see the quality and was pleasantly surprised to see the shirts were crisp and nice. Keep your options open in expanding your marketing.
EIN-Yes, free. But, if you are a sole then you won't get any benefits from wholesalers such as discounts and waiving the taxes. In my area, some banks cater to sole, however, it is wise to keep your professional and personal finances seperate; being LLC give you the liability protection. A good book to read is Small Business Kit for Dummies and Small Business for Dummies.
1. NAME YOUR COMPANY - The first step in this process is to select a company name. Be sure you pick one that has not been selected by another company in your state, You can check with you Secretary of State and once that is done you can move onto the next step.
2. INCORPORATE YOUR COMPANY - Now that you have selected your business name, you are going to need to establish your corporation with the state of your choosing. To do this, you can go to "Free Registered Agent". which is owned by InCorp Services. They will give you registered agent services free for the first year. They also only charge a nominal fee plus your states filing fees to incorporate your business.
3. OBTAIN AN EIN - Once you have incorporated your business you will need to obtain a Federal Employer Identification Number. You can file form SS-4 online at the Internal Revenue Service website. http://www.irs.gov/businesses/small/article/0,,id=102767,00.html
Once you have completed this form you will obtain your EIN in a matter of seconds. Be sure to print it out and write it down because they do not send you an email confirmation. This is the number that you will need in order to apply for credit under your business name without a personal guarantee.
4. ESTABLISH A LOCATION - So now you have your EIN and are incorporated. Your business needs to have a physical location that is not your home address. The UPS store will not work because most creditors have them flagged. An alternative is to get a virtual office in your home town. Most of these will supply you with a lease agreement (sometimes needed to get credit), license hanging services, your name on a wall plaque at the location, and mail forwarding services. You should be able to find these services bundled for about $100 per month. In addition, some of these places will even allow you small usage of the buildings conference room and offices for an additional fee. This is great if you just need a completely quiet place to work for a few hours or if you need to sign a contract or conduct a meeting.
5. ESTABLISH PHONE SERVICE - Now that you have a physical location for your business, you will need to establish a utility bill using your newly received EIN and business address. There are many choices for this step of the process.
a) Contact your local telephone companies business sales department and request what they call a Remote Call Forwarding Number. This is a number that the phone company manages at their and is forwarded to a number of your choosing. They will usually charge a setup fee and $10 to $15 per month. Make sure you give them the address of the office that you set up and the EIN number. Also make sure that they will list you in the 411 directory under your address, not theirs.
b) Another method is to get an 800 number and have it forwarded to a number of your choosing. You can then utilize "List Yourself" to add yourself to your local 411. However, this is not recommended because there is still no free way (that I know of) to list yourself in the national 411 directories.
c) For those of you that need a true business line, you can subscribe to the Vonage Small Business Premium service (or any other small business VOIP service) and for $49.99 per month and they will list your business in both your local and national 411 directories.
6. ESTABLISH A CHECKING ACCOUNT - Once you have all of that in order, you can now open your corporate checking account. Many banks only require $100 to open the account, 2 forms of identification, and your Articles of Incorporation.
7. OBTAIN A D-U-N-S NUMBER - Now you need to go to Dun & Bradstreet and obtain a D-U-N-S Number. In the two more years of buidling business credit I have noted one ever constant factor.... Dun & Bradstreet is the leading cause of headaches for businesses trying to build a credit file. [IMG]file:///C:/Users/CREATI%7E1/AppData/Local/Temp/msohtmlclip1/01/clip_image001.gif[/IMG]New business owners are especially prone to the sales pitches thrown by commission hungry DUNS sales reps. Just about every new business owner tends to ask a question about DUNS or ends up complaining about them.
The front lines of D&B are covered by the DUNS sales representatives. More often than not if you are trying to get a DUNS number from them it starts the vicious cycle of how worthless simply having the number will be and how you "need" to buy CreditBuilder or another product to have a full rated file. The plain and simple fact is, you do NOT need to buy anything from DUNS to end up with a fully rated file! DUNS sales reps will of course try and tell you otherwise in hopes of making you pay.
Unlike personal credit CRAs, DUNS is not governed by the FCRA. They are a loose canon existing within a realm of pure gray area when it comes to regulation. Simply put, they can screw you and get away with it if your not careful.First thing that has often been misunderstood is that you need to get a DUNS number in order to have a file. Or that you need to contact DUNS to open a file or get a number. This is misinformation.
A DUNS number can and is automatically created by one of the following:
a) When your first NET30 account reports the tradeline the DUNS system will automatically create your number and file.
b) If you are incorporated, the Secretary of State in your state will often automatically report your corporation's existence as it reports quarterly or semi-annually to DUNS.
I am unsure if every states SOS office in fact does this. Many I know do. The best bet for auto creation is to simply open some starter NET30 Internet based office suppliers (see below). Be sure and use the account and then promptly pay the invoice you get. Most of these places will open you a NET30 terms account with as little as a 411 phone listing for your company. There are enough of these vendors out there to use if one or the other gives you grief insisting they need to see a credit file. Some of these vendors may ask you to place an initial prepaid order. No biggie. Get it out of the way and move on to having a NET30 terms account. Many will open you one from the start no questions asked.
Though it's just as easy to let it auto create. The thing you MUST be is PATIENT! It's not going to all happen in a day or even a week. If you miss out on the vendors reporting cycle it may take a number of weeks for the NET30 to report. But given your alternative of calling the main DUNS numbers and getting grief from the commission hungry reps and possibly getting your file flagged by a rep who is going to try to hamstring you or otherwise extort services from you, it would be wise to just let it auto create.
Again, you DO NOT need to call DUNS to get a number or file. Just like Experian business files, DUNS will auto create with the SOS or first tradeline data.
When you do a search on DUNS for your business and it finally shows up, then you want to get eupdate access. In order to access your eupdate report you need two things, your DUNS number and an eupdate password. The easiest way to accomplish this is to click your business when it shows up in a search. It will give you several different type reports you can buy on the company. Select the cheap $9.99 basic report. All you want is the DUNS number here. Buying more expensive reports will likely not yield any other info given how new your company is. Don't waste your money. Spend the $9.99. Buy the report. You will then get to see your DUNS number.
am I going the right route with LLC? 
