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Written by: Carolyn Young
Carolyn Young is a business writer who focuses on entrepreneurial concepts and the business formation. She has over 25 years of experience in business roles, and has authored several entrepreneurship textbooks.
Edited by: David Lepeska
David has been writing and learning about business, finance and globalization for a quarter-century, starting with a small New York consulting firm in the 1990s.
Published on October 6, 2021
Montana is known as Big Sky Country because of its vast open landscapes flanked by snow-topped mountains, linking the Rocky Mountains and the Great Plains and giving us the glories of Glacier National Park and more.
Montana is also called the “Treasure State” due to its many mineral deposits, which has made mining an important industry in the state, alongside farming and energy. The state offers a high-level of business friendliness, a low cost of living and a low cost of doing business, which means that with a good idea and determination you can find success in Montana.
Of course, careful planning is also very important. Lucky for you, this step-by-step guide provides all the information you’ll need to develop your idea and begin your entrepreneurial journey in Big Sky Country.
By 2022 revenue((https://www.ibisworld.com/united-states/economic-profiles/montana/))
The crucial first question is, what sort of business would you like to run? You may have several ideas in your head, or maybe you haven’t gotten that far. Either way, it’s wise to look closely at the state itself and at your own abilities to best determine which areas might offer the most opportunity.
To develop a business idea, you could:
Once you have a few ideas in mind, do some homework to decide if your ideas are feasible. Here are some things to consider when choosing a business idea:
Once you’ve chosen a business idea, get more specific in your evaluation of the opportunity. Consider the why, what, how, and who.
First, consider the viability of the business idea you have in mind. Here are three questions to consider:
Starting a business requires investment, so it’s unwise to just assume profitability. Make it a point to conduct research and ask people you know and trust what they think of your idea.
Montana’s economic development website offers a wealth of information for new businesses, including funding options, workforce, and locations.
The next thing to do is define your offerings. Ask yourself:
You may consider offering related products or services to increase purchase sizes and boost overall value for customers. This step is going to define how your business will look to customers and why they will buy, so take your time and be sure.
Before determining your price list, get to know your competitors. Visit the shops and websites of companies that offer similar products or services — see what they’re selling and at what prices and use this to inform your decisions.
If you have a direct competitor, it’s a good idea to choose a competitive price point. Run the numbers to find your break-even price, then use this Step By Step profit margin calculator to determine your mark-up and final price point.
You’ll also need to consider how to position your product. Are you going to offer a lower-priced alternative, a la Walmart, or are you going to position your business as more high-end, like a Pottery Barn or Restoration Hardware?
Once you’ve locked on a pricing system that works for you, you’ll need to test it to see if this is attractive to your target market.
Knowing your target market is crucial to successful sales and marketing. This is where customer profiling comes in handy.
The first thing to do is figure out whether you’re selling to consumers or businesses. If you choose consumers, determine which people are most likely to buy, by looking at:
Knowing your customers will allow you to shape your messaging and know where to place your marketing. For example, based on who your customers are and what they like, are they more likely to be on Facebook or TikTok?
If you are selling to businesses, first determine what kinds of firms will be interested in what you’re offering. Next, figure out the relevant decision-maker within these companies — it may be a VP, IT manager, or head of sales — and adjust your marketing accordingly.
Your business name is your business identity, so choose one that encapsulates your objectives, services, and mission in just a few words. You probably want a name that’s short and easy to remember.
Here are some ideas for brainstorming your business name:
Once you have a few potential names, check the Montana Secretary of State’s business search to see if anyone else has claimed your desired name. You can also read through the Secretary of State’s rules and regulations on naming a business and ensure you are in compliance.
It’s also a good idea to check for nationally trademarked names, to ward off any potential problems later if your business expands, and check the availability of related domain names using Domain Name Checker tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these.
Once you’ve found a name that clears these hurdles, go ahead and register via the Secretary of State’s online portal, which has a $10 fee.
Drawing up a business plan may seem like a daunting task, but it’s an essential step in creating a successful business. The plan will function as a trail map to guide your startup through the launch process and maintain focus on your key goals. A business plan also enables potential partners and investors to better understand your company and its vision.
Choosing your business location is an important decision because it can affect your taxes, legal requirements, and revenue. But you’ve already decided to launch your business in Montana, so we can check that box.
Businesses come in several varieties, each with its pros and cons. The legal structure you choose for your business shapes your taxes, personal liability, and business registration requirements, so it’s important to choose wisely.
In Montana, registration documents can be filled out via the online business portal, ePass Montana. You will need to create an account to access documents such as the Articles of Incorporation for certain business structures. The Montana Secretary of State no longer accepts paper forms, and everything must go through the ePass Montana system. There are additional FAQs for the online portal here.
If you are starting an LLC, LLP, Corporation, or nonprofit, you will also need to appoint a registered agent. They are responsible for receiving all of the official paperwork sent from the Montana Secretary of State. An easy and quick way to get a registered agent is to use ZenBusiness’s online registered agent service.
The most popular business entity types are outlined below.
Sole proprietorship is the most simple and straightforward structure, and therefore the most common for small businesses. It is an unincorporated business, with no legal distinction made between the business and the owner. As a sole proprietor, all income goes to you, but you are also liable for any debts, losses, or liabilities incurred by the business.
This type of business structure does not need to be registered with the Secretary of State. The only paperwork that needs to be filed is a registration for an Assumed Business Name if the sole proprietor operates under any name besides their own. This can be done online via ePass Montana; there is a $20 fee to do so.
General partnership is similar to sole proprietorship, but with two or more people forming the company. Again, they keep the pre-tax profits but are jointly liable for any losses or liabilities. In a general partnership, each partner is known as a general partner and has unlimited liability.
Again, like a sole proprietorship, the only paperwork required for a general partnership is an Application for Registration of Assumed Business Name via ePass Montana for a $20 fee.
This business structure is popular with lawyers, accountants, and architects. It is more formal than a general partnership and allows each partner to limit their liabilities and share management responsibilities according to an agreement between the partners. This can be a good choice when one or more partners want to invest in the business but have little or no management responsibility.
In Montana, you will need to file a Registration of Domestic LLP on the ePass Montana portal. There is a $20 filing fee to do so.
The next step up is a corporation, in which the company is a separate legal entity from its owners. In this structure, the owners are not personally liable for losses, but take their profits through shareholder dividends.
If you choose to create a Montana corporation, you will also need to decide whether you want to form a C corporation or an S corporation. More information about corporations in Montana is located here.
You will need to file Articles of Incorporation on the ePass Montana portal for a $70 fee in order to register a corporation in Montana.
A limited liability company (LLC) combines characteristics of corporations with those of sole proprietorships. As the name suggests, the owners are not personally responsible for liabilities or debts. As an LLC, you’ll need to choose whether you want to be taxed as an LLC or as an S Corp.
The regulations for LLCs vary from state to state. Although they are more straightforward to set up than a corporation, Articles of Organization must be filed with the state for the LLC to become a legal entity.
To register an LLC in Montana, you need to file Articles of Organization through ePass Montana for a $70 fee.
As mentioned above, if you’re thinking of forming a limited liability company (LLC) in Montana, you will need a Montana registered agent to handle all of your official paperwork.
Finally, you may be interested in a nonprofit if your business idea has a social purpose. A non-profit organization is a legal entity organized and operated for a public or social benefit, as opposed to a business formed to generate a profit for its owners.
A nonprofit organization needs to file Articles of Incorporation through the ePass Montana portal. There is a $20 fee to do so.
The final step before you’re able to pay taxes is getting a Montana Employer Identification Number or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN.
Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business operations will occur over the period of a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.
The IRS website also offers a tax-payers checklist and taxes can be filed online.
It is important to consult an accountant or other professional to help you with your taxes to ensure you are completing them correctly.
The Montana Department of Revenue oversees business taxes in the state. More information is available on their website. Corporations in Montana pay a standard corporate tax rate of 6.75%. All deadlines and tax return information are located here.
After creating your business plan, you should know how much money you’ll need to launch your business. Securing financing is your next step and there are plenty of ways to raise capital:
Montana-specific funding options:
You may need to obtain certain business licenses and permits to comply with Montana law. These permits and licenses can vary based on the town or city where the business is located.
Montana city and county offices are responsible for providing business licenses in the state. Professional licenses are regulated by the state of Montana’s Department of Revenue. Examples of licenses are securities licenses, commodity dealers licenses, or car dealers licenses. There are over 200 different licenses administered by government agencies — a full list is available here.
Here are some additional resources:
This is not a step to be taken lightly, as failing to comply with legal requirements can result in hefty penalties.
If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes. You might consider a license compliance package from a filing firm such as MyCorporation or MyCompanyWorks, or hire an attorney via Avvo or FindLaw.
More resources:
Before you launch your business you’ll need somewhere to put the money you make, and that requires opening a bank account.
Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you run your business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer business account options, just inquire at your preferred bank to learn about rates and features.
Banks vary in terms of offerings, so it’s a good idea to consider your options to choose the best plan that works for you. Once you choose your bank, you’ll need to bring your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and any other legal documentation that proves your business is registered.
The Montana Department of Administration oversees banking and financial services, and their website has information on registered banks and credit unions.
Business insurance is an area that often gets overlooked yet it can be vital to your success. Insurance protects you from unexpected events that can have a devastating impact on your business.
Here are some of the different types of insurance to consider:
As opening day nears, prepare for launch by reviewing and improving some key elements of your business.
New businesses need to have the right tools and industry-specific software in place to help them manage their operations effectively.
One of the most important tools for a new business is an inventory management system, which allows them to track their inventory levels, monitor sales, and reorder products when necessary.
Another essential tool is a customer relationship management (CRM) system, which helps businesses manage their interactions with customers and prospects, and track sales leads.
Other useful software for new businesses might include payroll software, project management tools, and marketing automation software. By investing in the right tools and software, new businesses can streamline their operations, save time and money, and ultimately increase their chances of success.
Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism.
You can create your own website using services like WordPress, Wix, or Squarespace. This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech-savvy, you can hire a web designer or developer to create a custom website for your business.
They are unlikely to find your website, however, unless you follow Search Engine Optimization (SEO) practices. These are steps that help pages rank higher in the results of top search engines like Google.
Online marketing is crucial for new businesses as it provides a cost-effective way to reach a wider audience and build brand awareness. With a well-planned online marketing strategy, new businesses can establish their presence, attract potential customers, and compete with established players in their industry.
Here are some powerful digital marketing strategies for small businesses:
Take advantage of your website, social media presence and real-life activities to increase awareness of your offerings and build your brand.
Traditional marketing is any form of marketing that uses offline media to reach an audience. Some options include:
As your business grows, you will likely need workers to fill various roles and positions. But before you begin the hiring process, you should first consider the essential positions for your line of work.
What levels of management and employees will you have? What is your pay scale? Costs are always an issue for a startup, but you need to make sure that you pay enough to hire people with the right skills and experience.
It’s a good idea to create a hiring plan. First, determine which hires you’ll need to launch, then the future hires you’ll need as the business gets going. Be cautious and selective when hiring people for any role.
You want to build a great team that will make your business run smoothly and create a great work environment so you’ll retain them for a long time.
In Montana, new hires must be reported to the state’s New Employee Registry, and you can learn more here.
Free-of-charge methods to recruit employees include publishing a job ad on LinkedIn, Facebook or Jobs.com. You might also use a premium recruitment option, such as advertising on Indeed, Glassdoor, or ZipRecruiter. Finally, you could hire a recruitment agency to help you find talent.
With everything in place, you’re now ready to throw open the doors on opening day! When you do, you’ll want some customers coming in. Here’s how to find them.
Make sure to highlight the unique selling propositions, or USPs, of your products and services. Customers may already want your offerings, so your job is to convince them to pick you over your competitors.
Here are some good selling points that you can capitalize on:
Make sure that you are selling through the right channels. You know your target customers by now – where and how are they most likely to buy? Do they buy online or in stores?
If you don’t have a store, you can find partner stores where your products can be sold. You can sell both online and directly but focus your efforts on the channel that matches your target market’s buying behavior.
If you’re selling to businesses, your sales channels may be online or they may involve direct sales calls. Again, understand the buying behavior of the decision-maker within the business.
Help clients find you more easily by placing your marketing where they are likely to find it. With the right marketing strategies in place, a business can reach new audiences, build brand awareness, and ultimately grow its customer base and revenue.
Effective marketing can help businesses differentiate themselves from competitors, establish a strong online presence, and engage with customers through various channels such as social media, email marketing, and advertising.
By investing in the right marketing tactics and continually analyzing and optimizing their efforts, businesses can position themselves for long-term growth and success.
You’re now ready to start your successful business in Montana, but you might want to bookmark this page, just in case.
The cost to start a business in Montana depends on what type of business you are opening. Some have high start-up costs because they require a lot of equipment or inventory. Others just require a laptop and internet connection. Creating a thorough business plan will help you determine exactly how much capital you need.
There is also the cost to register a business in Montana. This is a minimal cost and ranges between $20 to register an LLP or nonprofit or $70 to register a corporation or LLC.
A good business to start in Montana is one that is carefully planned and executed. This guide provides all the steps needed to start a business and set it up for success. Review the steps around choosing a business idea, honing it, and coming up with a detailed business plan.
Ultimately, a good business to start in Montana is any business that meets the market needs of the people living there.
To officially start a corporation in Montana, you need to file Articles of Incorporation with the Secretary of State. This can be done through the ePass Montana portal for a $70 fee.
While this step makes your corporation legal in the state, there are other steps that are equally important. Review this step-by-step guide to make sure you are not missing anything.
To start a sole proprietorship in Montana, you need to essentially just start doing business! There is no need to register with the Secretary of State. You may need specific licenses and permits, though, depending on what type of business you are engaged in. Review the information in this guide to make sure you haven’t missed anything.
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