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Before you hawk your wares on Broadway, you need to register your business, establish a business bank account, and obtain a sales tax number
I am interested in selling my own custom-made jewelry at street craft fairs. What licenses or identification numbers do I need to sell at these events? I am in New York and probably would also do shows in Connecticut and New Jersey. —P.F., New York City
Whether you're selling at a street fair or displaying your jewelry in an upscale boutique, you need to register as a business. Typically in the startup stage, setting yourself up as a sole proprietor will do the job, says Martin Lehman, a small business counselor with the SCORE office in New York City, www.scorenyc.org. Sole proprietorships are the simplest form of business structure, used when one individual takes on all the business responsibilities and decisions for a company. The owner of a sole proprietorship has unlimited liability for the business, so be aware of that before you start your company.
"Register your business at the county clerk's office in your borough or the immediate area where the business will be located [presumably it will operate out of your home]. An EIN (employer identification number) is also required for most businesses," Lehman says. "Only sole proprietors with no employees are not required to have an EIN, since sole proprietors can use their Social Security numbers as an EIN."
When you register your company, you will be required to submit three copies of a form called "Certificate of Conducting Business as a Sole Proprietor." You can purchase this form from a legal stationery store in New York or through Blumberg Forms, www.blumberglegalforms.com, (800) 529-6278. Complete and notarize the form before you file it; the cost will be around $120, Lehman says.
ALLOW TIME TO REGISTER.
"Your next step will be to establish a business bank account," Lehman says. "It is a good idea to keep records of all monies spent by the firm and to keep receipts for tax purposes." Of course, keeping sales records will also be important for your new company.
Make sure you begin the business registration process several weeks before the trade fair or event where you plan to debut your product, as it can take several weeks to get through the paperwork.
When you are going to sell your jewelry at a trade fair, you will likely have to register as a vendor so you can be listed as an official participant. If you're selling out-of-state, inquire early about what additional documents you'll need to operate in another jurisdiction.
"Register yourself as a trade-fair participant. There is usually a fee involved, and it is better to do it yourself than to have the trade-fair managers register you and charge you back," Lehman says. "This process also can sometimes take a few weeks to complete." Information on licensing for street fairs and flea-market vendors in New York City is available online at the city's department of consumer affairs: www.nyc.gov/html/sbs/nycbiz/html/starting/street_vendors.shtml.
"The street-fair licenses are only good for 30 days. You will need identification papers—a green card, driver's license, or non-driver's [photo ID], and in some cases a birth certificate. The names on your ID must all correspond with the registered name on your business," Lehman says. There are small fees required for most of the licenses you'll need to obtain.
Finally, you'll need to obtain a New York State sales tax number and collect sales tax on your sales. Ask for more information from your bank or get it online from the New York State Taxation & Finance Dept.: www.tax.state.ny.us.
For extensive information about starting a business in New York State, see the Web site of the governor's office: www.gorr.state.ny.us/Startbus.html. The City of New York also offers excellent advice, workshops, and links on entrepreneurship at its NYC Small Business Resource Center: www.nypl.org/research/sibl/smallbiz/sbrc/Pages/index.cfm.