How to Start a Business in Hawaii

With the fastest startup growth in the nation, Hawaii is a great place to launch your new business. Start your business today with our simple step-by-step guide and get on the fast track to financial and personal independence. If you get stuck along the way, connect with a business resources in your local area for help.

To Start a Business in Hawaii, follow these steps:

Step 1: Choose the Right Business Idea


The first step toward business ownership is deciding what kind of business to start. Look for an idea that suits your interests, your personal goals, and your natural abilities. This will help you stay motivated when the going gets tough and will greatly improve your odds of success. Need inspiration? Here were the most popular ideas among our Hawaii visitors in 2017:

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Find the Right Business Idea for You

Our free Business Ideas Tool will help you identify great businesses that match your interests and lifestyle.

Business Ideas
Tool

Step 2: Plan Your Business


Successful businesses are built through careful planning. Before committing a significant amount of money and other resources toward your business, critically analyze your idea and create a game plan. At a minimum, you should have good answers to the following questions.

Product Development
What problem does your business solve? What will set your product or service apart from the competition?

Sales & Marketing
Who are your potential customers? How will you get their attention and convert them into buyers?

People and Partnerships
What roles will you need to hire and what professional relationships will you need to form in order to succeed?

Financial Planning
How many clients or sales will you need in order to break even? How much money will it take to get there, and where will you get the funding?

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Start Planning

Our Business Planning Guide helps you analyze your business idea and gets you access to free planning tools.

Need Help? Find organizations in your local area that can assist you with planning.

Step 3: Form your Business


Registering your company as an Hawaii business entity, such as an LLC or a Corporation, has two major advantages:

  • Increased credibility
  • Protection from personal liability in the event your business is sued

For most small businesses, registering an LLC is a great option. In comparison to other business entities, LLCs are easier to set up and manage and they have favorable tax treatment. You can set up an LLC in Hawaii for as little as $50.

If you choose not to register your company as a business entity, you will be held personally responsible for the debts and liabilities of your business. In addition, unregistered business owners may need to file a Trade Name, also known as a "DBA." Find out if your business is required to file a DBA.

Secure your Domain

We recommend that you check to see if the business name you are planning is available as a web domain. Even if you aren't ready to make a business website today, you may want to buy the URL in order to prevent others from acquiring it.

Find a Domain Now

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Step 4: Register for Taxes


With limited exceptions, most businesses require an Employer Identification Number (EIN), also known as a Tax ID Number. An EIN is used to identify a business in its federal tax filings. Without an EIN, you can't hire employees or open a business bank account.

Obtain an EIN

You should also be aware of important hawaii taxes that may apply to you business:

  • If you are selling a physical product, you’ll typically need to register for Hawaii Sales Tax.
  • If you hire employees, you will have to register for Unemployment Insurance Tax, and Employee Withholding Tax on behalf of your employees.
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Register for Hawaii State Taxes

Sales Tax | Employer Tax | Unemployment Insurance Tax

Step 5: Create Business Banking and Credit Accounts


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.

You can protect your business with these two steps:

1. Opening a business bank account:

  • Separates your personal assets from your company's assets, which is necessary for personal asset protection.
  • Makes accounting and tax filing easier.
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Recommended: Get $200 when you open a business checking account with Chase. Learn more.

2. Getting a business credit card:

  • Helps you separate personal and business expenses.
  • Builds your company's credit history, which can be useful to raise capital later on.

Step 6: Set Up Accounting


An accounting system helps you track the performance of your business and simplifies annual tax filings. Quality accounting software lets you download your bank and credit card transactions, making accounting fast and easy. Learn more about the importance of accounting and how to get started with accounting today.

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Recommended: QuickBooks has all the accounting features your small business will need.

Try QuickBooks for free

Step 7: Obtain Permits and Licenses


To operate your new business legally, you will need to comply with federal, state, and local government regulations. In many cases, this involves obtaining one or more business permits and/or licenses. For example, a restaurant will likely need health permits, building permits, signage permits, etc.

Step 8: Get Insured


Business insurance helps you manage risks and focus on growing your business. The most common types of business insurance you should consider are:

We recommend that all small businesses, including home based businesses, purchase a general liability policy. Businesses selling professional advice or services, such as consulting and accounting firms, should also consider a professional liability policy. In Hawaii, businesses with one or more employees, including LLC members and corporate officers, are required by law to have workers compensation insurance.

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Our recommended insurance provider can set you up with an insurance policy that is right for your business

Get a Quote

Step 9: Define Your Brand


The strongest and most memorable businesses are built on a solid brand.

When developing your brand, think about what your business stands for. What are the core values that drive your business? Customers and clients are looking for companies that have a compelling brand, as much as they are shopping for high quality products and services.

Your business name is the cornerstone of good branding and a successful business. To learn more about creating the best name for your business, read our How to Name a Business guide.

Step 10: Establish a Web Presence


A professional website is critical to the long-term success of your business, regardless of what industry you are in. A website allows potential customers to find your business online and discover the products or services you offer, and it also enhances your business’ credibility.

In addition to a website, you should also consider other avenues for promoting your business online:

  • Setting up social media profiles (Facebook, Twitter, etc)
  • Creating accounts on review sites (Yelp, Google Reviews, etc)
  • Registering for a local Google profile
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More than ever, people are looking for reviews before doing business. Yelp is an important aspect of social validation for your business, claim your page today and get $300 in Yelp advertising credit.

Sign up for our Business Center

Sign up for a free Business Center account for access to tools, legal documents, and discounts that will help you start and grow your business

Signup Now

Get Help From Local Resources

To help you start your business, we have identified the best resources across the state of Hawaii that can support you in your entrepreneurial endeavors.

Select your Region

Hawaii Local Resources

Hi’ilei Aloha LLC

Here are the Principle Service Areas:

  • Mentoring
  • Business Planning

Offers Free Service

Description

Hi’ilei Aloha can help you get your business off the ground by offering a free, one-hour mentoring session. While this organization is very well connected and can help you network with other useful resources, it also has its own workshops and seminars on starting your own business. They also offer a coworking space with conference rooms and access to networking events and workshops. The organization maintains a frequently updated list of grants available to startups and small businesses.

Restrictions

Businesses deemed beneficial to Native Hawaiians.

CONTACT INFORMATION:

711 Kapi‘olani Boulevard, Suite 111
Honolulu, HI 96813
808-596-8990
marthar@hiilei.org

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See more business resources in Hawaii

Hawaii Resources

Maui Local Resources

Maui Research and Technology Center

Here are the Principle Service Areas:

  • Coworking
  • Networking

Description

MRTC provides a coworking space for Maui-based tech companies. Your company can use office and conference space as well as services and amenities like high-speed wifi. This is an especially great opportunity for businesses in which owners tend to be somewhat isolated (for example, a business with only one owner/employee, or an international business). To apply for the incubator, a startup must be technology-focused and have the potential to grow in Hawaii and create jobs. They must also have funding in place to finance their stay at the incubator or have a clear path to such funding prepared.

Restrictions

Open to businesses with tech-based products or services; must have funding in place or have a clear path to receive funding.

CONTACT INFORMATION:

590 Lipoa Parkway
Kihei, HI 96753
808-875-5978
info@htdc.org

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See more business resources in Maui

Maui Resources

Oahu Local Resources

Oahu Resource Conservation and Development Council

Here are the Principle Service Areas:

  • Business Planning

Offers Free Service

Description

The RCD offers resources for agricultural entrepreneurs in Oahu. Their workshops cover general topics as funding your business as well as more niche topics like pest management. For a fee, it also offers contract-based administrative support to help expand your business. They specialize in consulting on environmental topics and can help ensure your agribusiness starts out on a green foot.

Restrictions

Open to agricultural businesses only.

CONTACT INFORMATION:

P.O. Box 209, 92-1770 Kunia Road
Kunia, HI 96759
808-622-9026
admin@oahurcd.org

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Oahu Resources