Starting a notary business can be very profitable. With proper planning, execution and hard work, you can enjoy great success. Below you will learn the keys to launching a successful notary business.
Importantly, a critical step in starting a notary business is to complete your business plan. To help you out, you should download Growthink’s Ultimate Business Plan Template here.
14 Steps To Start a Notary Business:
- Choose the Name for Your Notary Business
- Develop Your Notary Business Plan
- Choose the Legal Structure for Your Notary Business
- Secure Startup Funding for Your Notary Business (If Needed)
- Secure a Location for Your Business
- Register Your Notary Business with the IRS
- Open a Business Bank Account
- Get a Business Credit Card
- Get the Required Business Licenses and Permits
- Get Business Insurance for Your Notary Business
- Buy or Lease the Right Notary Business Equipment
- Develop Your Notary Business Marketing Materials
- Purchase and Setup the Software Needed to Run Your Notary Business
- Open for Business
1. Choose the Name for Your Notary Business
The first step to starting a notary business is to choose your business’ name.
This is a very important choice since your company name is your brand and will last for the lifetime of your business. Ideally you choose a name that is meaningful and memorable. Here are some tips for choosing a name for your own notary business:
- Make sure the name is available. Check your desired name against trademark databases and your state’s list of registered business names to see if it’s available. Also check to see if a suitable domain name is available.
- Keep it simple. The best names are usually ones that are easy to remember, pronounce and spell.
- Think about marketing. Come up with a name that reflects the desired brand and/or focus of your notary business.
2. Develop Your Notary Business Plan
One of the most important steps in starting a notary business is to develop your business plan. The process of creating your plan ensures that you fully understand your market and your business strategy. The plan also provides you with a roadmap to follow and if needed, to present to funding sources to raise capital for your business.
Your business plan should include the following sections:
- Executive Summary – this section should summarize your entire business plan so readers can quickly understand the key details of your notary business.
- Company Overview – this section tells the reader about the history of your notary business and what type of notary business you operate. For example, are you a corporate, independent, or a mobile notary business?
- Industry Analysis – here you will document key information about the notary industry. Conduct market research and document how big the industry is and what trends are affecting it.
- Customer Analysis – in this section, you will document who your ideal or target customers are and their demographics. For example, how old are they? Where do they live? What do they find important when purchasing services like the ones you will offer?
- Competitive Analysis – here you will document the key direct and indirect competitors you will face and how you will build competitive advantage.
- Marketing Plan – your marketing plan should address the 4Ps: Product, Price, Promotions and Place.
- Product: Determine and document what products/services you will offer
- Prices: Document the prices of your products/services
- Place: Where will your business be located and how will that location help you increase sales?
- Promotions: What promotional methods will you use to attract customers to your notary business? For example, you might decide to use pay-per-click advertising, public relations, search engine optimization and/or social media marketing.
- Operations Plan – here you will determine the key processes you will need to run your day-to-day operations. You will also determine your staffing needs. Finally, in this section of your plan, you will create a projected growth timeline showing the milestones you hope to achieve in the coming years.
- Management Team – this section details the background of your company’s management team.
- Financial Plan – finally, the financial plan answers questions including the following:
- What startup costs will you incur?
- How will your notary business make money?
- What are your projected sales and expenses for the next five years?
- Do you need to raise funding to launch your business?
3. Choose the Legal Structure for Your Notary Business
Next you need to choose a legal structure for your notary business and register it and your business name with the Secretary of State in each state where you operate your business.
Below are the five most common legal structures:
1) Sole proprietorship
A sole proprietorship is a business entity in which the owner of the notary business and the business are the same legal person. The owner of a sole proprietorship is responsible for all debts and obligations of the business. There are no formalities required to establish a sole proprietorship, and it is easy to set up and operate. The main advantage of a sole proprietorship is that it is simple and inexpensive to establish. The main disadvantage is that the owner is liable for all debts and obligations of the business.
A partnership is a legal structure that is popular among small businesses. It is an agreement between two or more people who want to start a notary business together. The partners share in the profits and losses of the business.
The advantages of a partnership are that it is easy to set up, and the partners share in the profits and losses of the business. The disadvantages of a partnership are that the partners are jointly liable for the debts of the business, and disagreements between partners can be difficult to resolve.
3) Limited Liability Company (LLC)
A limited liability company, or LLC, is a type of business entity that provides limited liability to its owners. This means that the owners of an LLC are not personally responsible for the debts and liabilities of the business. The advantages of an LLC for a notary business include flexibility in management, pass-through taxation (avoids double taxation as explained below), and limited personal liability. The disadvantages of an LLC include lack of availability in some states and self-employment taxes.
4) C Corporation
A C Corporation is a business entity that is separate from its owners. It has its own tax ID and can have shareholders. The main advantage of a C Corporation for a notary business is that it offers limited liability to its owners. This means that the owners are not personally responsible for the debts and liabilities of the business. The disadvantage is that C Corporations are subject to double taxation. This means that the corporation pays taxes on its profits, and the shareholders also pay taxes on their dividends.
5) S Corporation
An S Corporation is a type of corporation that provides its owners with limited liability protection and allows them to pass their business income through to their personal income tax returns, thus avoiding double taxation. There are several limitations on S Corporations including the number of shareholders they can have among others.
Once you register your notary business, your state will send you your official “Articles of Incorporation.” You will need this among other documentation when establishing your banking account (see below). We recommend that you consult an attorney in determining which legal structure is best suited for your company.
4. Secure Startup Funding for Your Notary Business (If Needed)
In developing your notary business plan, you might have determined that you need to raise funding to launch your business.
If so, the main sources of funding for a notary business to consider are personal savings, family and friends, credit card financing, bank loans, crowdfunding and angel investors. Angel investors are individuals who provide capital to early-stage businesses. Angel investors typically will invest in a notary business that they believe has high potential for growth.
5. Secure a Location for Your Business
Here are a few tips to help you find the perfect location for your notary business:
- Look for a space that is centrally located and has good visibility from the street.
- Make sure the space is large enough to accommodate your office equipment and clientele.
- Contact your local Chamber of Commerce or Small Business Association for leads on available spaces.
- Review your lease agreement carefully to make sure you are aware of all the restrictions and requirements.
6. Register Your Notary Business with the IRS
Next, you need to register your business with the Internal Revenue Service (IRS) which will result in the IRS issuing you an Employer Identification Number (EIN).
Most banks will require you to have an EIN in order to open up an account. In addition, in order to hire employees, you will need an EIN since that is how the IRS tracks your payroll tax payments.
Note that if you are a sole proprietor without employees, you generally do not need to get an EIN. Rather, you would use your social security number (instead of your EIN) as your taxpayer identification number.
7. Open a Business Bank Account
It is important to establish a dedicated business banking account in your notary business’ name. This process is fairly simple and involves the following steps:
- Identify and contact the bank you want to use
- Gather and present the required documents (generally include your company’s Articles of Incorporation, driver’s license or passport, and proof of address)
- Complete the bank’s application form and provide all relevant information
- Meet with a banker to discuss your business needs and establish a relationship with them
8. Get a Business Credit Card
You should get a business credit card for your notary business to help you separate personal and business expenses.
You can either apply for a business credit card through your bank or apply for one through a credit card company.
When you’re applying for a business credit card, you’ll need to provide some information about your business. This includes the name of your business, the address of your business, and the type of business you’re running. You’ll also need to provide some information about yourself, including your name, Social Security number, and date of birth.
Once you’ve been approved for a business credit card, you’ll be able to use it to make purchases for your business. You can also use it to build your credit history which could be very important in securing loans and getting credit lines for your business in the future.
9. Get the Required Business Licenses and Permits
To start a notary business, you will need to obtain a notary public license from the state. You may also need to obtain other licenses and permits, depending on the nature of your business. Contact your Secretary of State’s office to learn about other local business licensing requirements that must be met.
10. Get Business Insurance for Your Notary Business
The type of insurance you need to operate a notary business will depend on the type of business you are running.
Some business insurance policies you should consider for your notary business include:
- General liability insurance: This covers accidents and injuries that occur on your property. It also covers damages caused by your employees or products.
- Auto insurance: If a vehicle is used in your business, this type of insurance will cover if a vehicle is damaged or stolen.
- Workers’ compensation insurance: If you have employees, this type of policy works with your general liability policy to protect against workplace injuries and accidents. It also covers medical expenses and lost wages.
- Commercial property insurance: This covers damage to your property caused by fire, theft, or vandalism.
- Business interruption insurance: This covers lost income and expenses if your business is forced to close due to a covered event.
- Professional liability insurance: This protects your business against claims of professional negligence.
Find an insurance agent, tell them about your business and its needs, and they will recommend policies that fit those needs.
11. Buy or Lease the Right Notary Business Equipment
To start a notary business, you will need to purchase a notary stamp and notary seal. You can find both of these items on the Secretary of State’s website. In addition, you will need a notary journal to record all of your notarizations. Finally, you will need some basic office equipment, such as a computer, printer, and scanning device.
12. Develop Your Notary Business Marketing Materials
Marketing materials will be required to attract and retain customers to your notary business.
The key marketing materials you will need are as follows:
- Logo: Spend some time developing a good logo for your notary business. Your logo will be printed on company stationery, business cards, marketing materials and so forth. The right logo can increase customer trust and awareness of your brand.
- Website: Likewise, a professional notary business website provides potential customers with information about the services you offer, your company’s history, and contact information. Importantly, remember that the look and feel of your website will affect how customers perceive you.
- Social Media Accounts: establish social media accounts in your company’s name. Accounts on Facebook, Twitter, LinkedIn and/or other social media networks will help customers and others find and interact with your notary business.
13. Purchase and Setup the Software Needed to Run Your Notary Business
Some of the most common notary software programs you may need include Adobe Acrobat, Notary Public, and Surety. You can find more information about these programs and others on the National Notary Association website.
14. Open for Business
You are now ready to open your notary business. If you followed the steps above, you should be in a great position to build a successful business. Below are answers to frequently asked questions that might further help you.
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How to Start a Notary Business FAQs
Is it hard to start a notary business?
No, it is not hard to be a notary signing agent. There are some minimum requirements you must meet, however. In most states, you need to pass an exam and complete a certain number of hours of training. You also have to be at least 18 years old and a U.S. citizen or legal resident.
How can I start a notary business with no experience?
Starting a notary business can be more difficult if you don't have any experience. One way to get started is to look for a notary business course or seminar. These courses can teach you the basics of what you need to know to start your own business. You can also find books and online resources that can help you get started. Finally, you may wan to network with other notaries to get advice and tips.
What type of notary business is most profitable?
The most profitable type of notary business is one that specializes in estate planning and document preparation. This type of business can expect to charge higher fees than other types of notary loan signing agents, and their services are in high demand.
How much does it cost to start a notary business?
The cost of being a notary loan signing agent can vary depending on the state in which you reside. In general, you will need to pay a filing fee to the state, and may also be required to purchase liability insurance. You will also need to purchase a notary stamp and seal.
Typically, the startup costs for a notary business range from $100 to $500.
What are the ongoing expenses for a notary business?
The ongoing expenses for notary signing agents can include items such as equipment, supplies, and marketing.
Standard equipment expenses include a computer, printer, scanner, and software. Supply expenses may include stamps, notary seals, envelopes, and paper. Marketing expenses such as website design and maintenance, advertising, and business cards should also be included in the budget.
Some of these ongoing expenses may be tax deductible. It is important to speak with an accountant to determine what expenses can be claimed.
It is vital to keep track of all expenses related to the notary business to stay organized and efficient. By keeping track of costs, notaries can ensure that they operate their business in the most cost-effective way possible.
How does a notary business make money?
A notary public is a trusted public servant who witnesses the signing of important documents and performs other legal signing services. Notaries charge for their services, which can include loan signings, document authentication, witnessing signatures, and taking oaths.
Many notaries also offer document translation services, which can be lucrative if the translator has a good reputation in the community. Some mobile notaries also provide notary services, which can be especially helpful for busy people who need to get documents notarized but can't take the time to go to a notary's office.
Is owning a notary business profitable?
The answer to this question depends on a number of factors, including the size of the local market for notary services and the fees that a notary charges. In general, owning a notary business can be profitable if it is well-run and marketed correctly.
There are many reasons owning a notary business can be profitable. For one, notaries are in high demand; there's always a need for notaries to witness the signing of important documents. Additionally, very little capital is typically required to start, so it's a relatively easy business to set up. Notary services are also relatively low-cost, so they can be a profitable venture even if you don't have many clients. Finally, because notary services are in high demand, you can typically charge fairly high fees for your services.
Why do notary businesses fail?
One of the biggest reasons notary businesses fail is because the owner does not have the proper knowledge or training about the business. Other reasons include poor marketing and not having a solid business plan.