Start a fireworks tent business by following these 9 steps:
You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple guide to starting your fireworks tent business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
Check out our How to Start a Business page.
STEP 1: Plan your business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a fireworks tent business?
The three things that you will always need to start a fireworks tent are as follows; a tent or movable, collapsible structure to conduct your business, the fireworks themselves, and money for any staff and security you may have during the season. These can all vary widely but always consider if you don't sell your inventory by the end of the season, you may be left with a huge money sink. Choose carefully when buying fireworks. The tent may also be a bigger consideration, as a tent that lasts several seasons will almost always be worth much more than a tent that is only good for a season.
Who is the target market?
Your biggest market will be those throwing 4th of July parties. Depending on what yours state allows you to sell your audience can range from young children to adults and everything in between. Providing a wide variety of price points and bundling fireworks together will help keep all your markets satisfied.
How does a fireworks tent business make money?
Fireworks tents make money by buying fireworks in bulk from suppliers and then selling those fireworks piecemail. Essentially acting as a middle man between the factory and the consumer. Creating high profit margins with the ability to negotiate through your bulk discount you can make a significant amount of money by being a salesman. Your biggest issue will come if you are left with fireworks at the end of 4th of July. As time passes farther from the holiday your sales will plummet.
What will you name your business?
Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Business Name Generator
When registering a business name, we recommend researching your business name by checking:
- Your state's business records
- Federal and state trademark records
- Social media platforms
- Web domain availability.
It's very important to secure your domain name before someone else does.
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your fireworks tent business is sued.
Form Your LLC
Read our Guide to Form Your Own LLC
Recommended: You will need to elect a registered agent for your LLC. LLC formation packages usually include a free year of registered agent services. You can choose to hire a registered agent or act as your own.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
Small Business Taxes
Depending on which business structure you choose, you might have different options for how your business will be taxed. For example, some LLCs could benefit from being taxed as an S corporation (S corp).
You can learn more about small business taxes in these guides:
There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Additionally, learning how to build business credit can help you get credit cards and other financing in your business's name (instead of yours), better interest rates, higher lines of credit, and more.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Recommended: Read our Best Banks for Small Business review to find the best national bank, credit union, business-loan friendly banks, one with many brick-and-mortar locations, and more.
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a fireworks tent business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
Fireworks tents may also wish to look into applying for a resale certificate, as a resale certificate allows retailers to purchase goods intended for resale without paying sales tax.
Additional local licensing or regulatory requirements may apply. For more information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Sale of Fireworks
For a complete list of laws state by state regarding the sale of fireworks please check out this resource from US Fireworks
STEP 7: Get business insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Learn more about General Liability Insurance.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners, we'll give you helpful tips and advice for creating the best unique logo for your business.
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How to promote & market a fireworks tent business
In an ideal world the fourth of July will happen on a weekend, and at a time when individuals are more interested in setting off their own fireworks versus going to a fireworks display.
In 2020, the fourth of July falls on a Saturday and because of the current coronavirus, many of the firework events that you might expect to happen, drawing large crowds of people are not happening. This is forcing consumers to buy their own fireworks if they want to light fireworks off for their children and other family members. This has created a perfect storm this year for selling fireworks
How to keep customers coming back
Always try and make a lasting impression as you may not see a returning customer until the following year. Good faith towards your clients will go a long way.
STEP 9: Create your business website
After defining your brand and creating your logo the next step is to create a website for your business.
While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.
Here are the main reasons why you shouldn’t delay building your website:
- All legitimate businesses have websites - full stop. The size or industry of your business does not matter when it comes to getting your business online.
- Social media accounts like Facebook pages or LinkedIn business profiles are not a replacement for a business website that you own.
- Website builder tools like the GoDaddy Website Builder have made creating a basic website extremely simple. You don’t need to hire a web developer or designer to create a website that you can be proud of.
Using our website building guides, the process will be simple and painless and shouldn’t take you any longer than 2-3 hours to complete.
Start A Fireworks Tent Business In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
This business is a good fit for entrepreneurs who are pyrotechnical minded. It also helps to have strong social skills as many of your sales will be negotiable. Having a love for summer and the outdoors will also give you an edge over your competition.
Want to know if you are cut out to be an entrepreneur?
Take our Entrepreneurship Quiz to find out!
What happens during a typical day at a fireworks tent business?
Your day to day opperations generally involves stocking and pricing your inventory, marketing your stand to attract clients, selling to those clients, and then hopefully lighting off a few fireworks at the end of the day. Since your peak times will be around July 4th yoou may have a varied schedule depending on demand.
What are some skills and experiences that will help you build a successful fireworks tent business?
Having sales experience is a big plus when opening a fireworks tent. Having good relationships with your suppliers and your clients will be key in growing and profiting from your business.
What is the growth potential for a fireworks tent business?
Growth for fireworks tents comes in having more of them over a wider area. Due to its seasonal nature, fireworks tents rarely operate all year round, especially in states that get heavy rain or snow. Opening more tents each year is a good sign that you are on the right track, but also expanding your inventory and hiring more staff will allow you to create a dedicated team of salesmen, who will hopefully create better profits for you.
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Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a fireworks tent business?
Multiple tent locations mean more money. You can make huge profits over a very short period providing you have several firework tents available to the public.
The key to being successful in this industry is capitalizing on the opportunity. Unfortunately, the opportunity has a very short window of time in which you can sell fireworks. To maximize your opportunity, you must have as many locations set up as possible so you can sell as many fireworks as you can during this limited window.
How and when to build a team
You will need customer service and sales reps to sell your fireworks. Make sure to pick individuals that you trust, who are reliable and willing remain at the firework tent for the whole two-week period. Pay them a percentage of the profit plus a base rate. This will ensure that the person selling the fireworks has a vested interest in your business and will do a great job selling the fireworks.