Running a Manufacturing Business: Legal Practices

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According to a study by the National Institute of Standards and Technology, the manufacturing industry has contributed 2269.2 Dollars in GDP. This figure accounts for 10.8 percent of the total GDP. That means venturing into this business is not only lucrative but also promising.

However, as with any other business, there are certain legal practices you need to be aware of to avoid running into trouble. Here are some things you need to know about the legal aspects of manufacturing:

Business name registration

Before anything else, you need to register a business name for your manufacturing company. This part is essential as it helps to establish your business identity. It also makes it easier for customers and suppliers to find you.

Without a legalized business name, it’s easy to confuse your company with another business, leading to legal problems. So, as a precautionary measure, always make sure to register your business name first. This way, you can avoid any potential legal issues down the road.

Registering your business also protects your intellectual property, including your company name, logo, and tagline. It’s vital to setting up your business and ensuring its long-term success. The registration process is usually straightforward and can be accomplished in a few days. So, there’s no excuse not to do it.

Business license acquisition

A business license is another one of the first things you need to obtain when starting any business. This document will allow you to operate legally in your state or locality. Depending on the type of products you’ll be manufacturing, you may need additional licenses and permits.

The process of getting a business license is simple. All you need to do is apply with the Small Business Administration or your local Chamber of Commerce. Some states may require you to file for a DBA or “Doing Business As” certificate.

A representative will most likely come to your manufacturing facility to inspect it. They will also verify that you can operate according to your area’s manufacturing codes and regulations. When done, you will get a certificate you need to display in a conspicuous place. This way, customers and clients will know that your business is legitimate.

Location-specific registrations

Aside from the global registrations, you must also take care of the local ones. Depending on your business location, you may require other registrations.

Suppose your business is in Canada. In that case, a Canadian Registration Number might be necessary. This registration is vital for most fittings, piping equipment, and pressure vessels. If you need help finding your CRN number, many companies offer a quick CRN consultation and assistance. By getting in touch with these businesses, you can avoid looking for your CRN number on your own.

On the other hand, the United States requires a different set of registrations. If your business is in the US, you must obtain an Employer Identification Number from the IRS. You will need this number for tax purposes and other government filings. The process is simple and can be completed online in minutes.

Safety clearances

Of course, safety is one of the main concerns of any manufacturing business. After all, you will be dealing with heavy machinery and other dangerous equipment. To protect your workers and your business, make sure to get the necessary safety clearances.

In the US, for example, you need to get a Certificate of Authorization from the Occupational Safety and Health Administration. This certification proves that your company complies with the safety standards set by the agency.

To get the certification, you must submit an application and undergo a comprehensive safety audit. The audit will evaluate your company’s compliance with OSHA’s safety guidelines. Once you pass, you will receive your certificate, valid for three years. It’s a good idea to renew your certification before it expires to avoid any lapse in coverage. With this document, you can operate your business without any worries.

a male auditor checking equipment in a manufacturing facility

Applying for insurance coverage

Every business, no matter the size or type, needs to have insurance. In doing so, you can protect your business from any potential liabilities. Many first-time entrepreneurs make the mistake of thinking that their business is too small to require insurance.

But the truth is, even the smallest businesses are at risk of being sued. That’s why it’s essential to have adequate coverage for your company. The type of insurance you need will depend on the products you manufacture and sell.

Whichever it is, shop around and compare rates from different providers. In doing so, you can find the best deal for your business.

Once you have all the necessary registrations, you can start your manufacturing business without legal worries. Make sure to keep all your documents up to date to avoid penalties or fines. You’re ready to venture into the manufacturing world with the above information. So, what are you waiting for? Start your business today.

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