How to Start a Small Business Selling Your 3D Printed Products (Prints) and Files (Designs): A Complete Beginner’s Guide

November 29, 2020

After you’ve selected your 3D Printer using our How to Choose the Best 3D Printer for Your Business: A Complete Beginner’s Guide, in order to begin selling your 3D printed products either online or out of a store, it is important to establish a business structure to deal with issues that will come from dealing with banks, taxes, and other federal state and local laws. This comprehensive beginner’s guide to starting a small 3D printing business will help guide you step-by-step in setting up a business. It will also provide you some information on how to protect your creation from being pirated.

Steps to Start a Small Business Selling Your 3D Printed Products

Step 1 – Create a Business Plan
Step 2 – Determine Your Business Structure
Step 3 – Choose Your Name Your Company
Step 4 – Register in the State You Want to Do Business
Step 5 – Get Your Employer Identification Number (EIN) from the IRS
Step 6 – Get Your Business License (If Necessary)
Step 7 – Open a Business Banking Account

Step 1 – Create a Business Plan

First things first, if you’re looking to start a business selling 3D printing products, you need to create a business plan. A business plan allows you to outline specific aspects of your online business, including:

Executive Summary
Company Description
Products/Services
Market Analysis & Target Audience
Management Team (if applicable)
Financial Plan

We recommend reading Creating a Business Plan For Dummies to learn how to write a business plan. It is an easy to understand guide for beginners.

Step 2 – Determine Your Business Structure

There are several business structures available to you, but two that are important for you to know about include sole proprietorships and limited liability companies.

What is a Sole Proprietorship?

A Sole Proprietorship is a business with one owner who runs and operates the business independently or

a business where spouses co-own and operate the business. This is the most basic business structure and it operates with fewer legal requirements than other business types because the business is directly tied to the owners, the business is not a separate entity for liability purposes.

Benefits:

Simple to get started
Easier tax reporting requirements (personal income tax, business deductions available)

Risks:

Personal liability for financial losses and legal action
More challenging to secure financial loans

What is a Limited Liability Company (LLC)? (Recommended)

A limited liability company (LLC) is a business structure that operates as a blend between sole proprietorships, partnerships, and corporations.

This business type is popular for small businesses as it provides greater legal protection to the individual owner(s), however, allows more simplified taxation than is found with corporate entities.

Benefits:

Greater protection of personal assets than a sole proprietorship because the business is distinct from the individual (business absorbs losses and liability)
Allows for flexibility in taxes as owners can choose whether the LLC is taxed similar to a partnership or a corporation
Operates with fewer requirements than corporations

Risks:

Higher cost to operate as an LLC than a sole proprietor

Other Types of Business Structures

Partnerships

There are a few different types of partnerships including general partnership, limited partnership, limited liability partnership, and limited liability limited partnership. Each partnership type is differentiated based on whether the business is registered and any of the partners act as ‘silent partners’.

Corporations

Corporations come with many more requirements than other business structures. There are two types of corporations: C-Corporations and S-Corporations.They differ based on the manner in which taxes are processed.

If you want to move beyond LLC, we recommend you read Incorporating Your Business For Dummies to get more information on each business structure.

Step 3 – Choose Your Name Your Company

Next up, you need to name your online business. Choosing the right name can be tricky, but here are a few tips to make the process easier.

Make sure the name isn’t already being used in your areas or for similar products
Check that the name isn’t trademarked
Choose a name that is easy to say, read, and spell
Consider if the name could limit the potential for your business
Make sure the name is a good representation of your product or service selection

Step 4 – Register in the State You Want to Do Business

How to Register Your Business in a State

When it comes to registering your home business or online business, there are a few factors to consider, including:

Your business structure
Your business name, and
The state or states your business will be operating in

For sole proprietors operating under their own legal names, no registration is generally required. However, if you’re operating under a business name that is not your own, you’ll need to register that business name with your state.

If you choose to operate your online business as an LLC, partnership, or corporation you’ll need to register your business with any state you operate in, and you’ll need to secure a registered agent, who receives legal documents and business papers before you can do that.

Keep in mind that each state operates in a slightly different way, so it is important to do your research and understand the requirements for the specific state(s) you’re operating in.

Online Resources to Register Your LLC

Once you’ve come up with the name of your LLC, the most important step you need to do is to register your LLC with your state. One of the easiest ways to register your online business LLC is with LegalZoom. LegalZoom can help take the guesswork out of registering your business as a limited liability company and provide peace of mind knowing that you’re taking all the necessary steps with your business. You get access to vetted attorneys who will take care of all the nitty-gritty paperwork and make sure that your business starts off on the right foot.

Step 5 – Get Your Employer Identification Number (EIN) from the IRS

An employer identification number is a unique identifier for your business and is needed in order to pay federal taxes, apply for business licenses that you may need to operate your business and open a bank account for your small business. You can register for your EIN online with the United States Internal Revenue Service (IRS). Your local state may also require a state-level tax ID number, so be sure to check with your local tax authority for more information.

Step 6 – Get Your Business License (If Necessary)

Some small businesses may require a business license from federal or state levels to operate. The need for a business license depends on the activities of your business. Many times the state’s secretary of state or local chamber of commerce can provide you information on this.

Step 7 – Open a Business Banking Account

Prior to opening a business banking account, you’ll need to secure your EIN. With a business bank account, all money that flows through your business, whether operating as a sole proprietorship, partnership, or another business type, will be distinct from your personal bank accounts and provide you some additional benefits. It is important to know that you should not mix your personal funds with this business account as it will cause issues with the IRS if you were to be audited.

Other Important Things to Consider for Your 3D Printing Business

Take Good Records of Business Transactions

As an online business owner, it’s your responsibility to ensure you keep accurate records of business transactions. This is important for completing taxes and in case of a financial audit. You may want to invest in Quickbooks to track your spending and can help with filing taxes for the company. Additionally, you may want to seek out a business accountant or read up on it in Bookkeeping All-in-One For Dummies.

How to Protect Your Designs, Intellectual Property and Copyright

When it comes to operating a creative online business in 3D printing, it is important that you take the necessary steps to protect your designs and have some recourse from people who may pirate your products.. Here are some tips to protect your intellectual property:

Write up terms and conditions for use of your designs
Know where your designs are shared
Report copyright infringements
Understand the guidelines of any third-party sites you may use to share your 3D printing products

There are many sites that can provide you information on the topic, but we recommend you seek professional assistance. Again Legal Zoom can help you with this. You can also reach out to the United States Patent and Trademark Office for more information on the topic. Just go to their site and type in the relative topics you want information on.

What’s Next?

The next step is to now set up where you plan to sell your items online. Please see our Complete Beginners Guide on How to Sell, Price and Market Your 3D prints or 3D designs. It will walk you through some fundamental considerations when it comes to setting up an online 3D printing business and selling, pricing, and marketing your products and designs online.