Too often, the regulatory requirements of starting a business are unclear for entrepreneurs and can be more difficult for immigrants navigating cultural and language barriers. This is especially the case when starting a brick-and-mortar business. Conflicting information from various local regulatory bodies can cause delays that are far costlier than just the added time to become compliant. To entrepreneurs, it may mean more time paying rent on a commercial space with no revenue or income, and it can often be the difference between a successful enterprise and one that is forced to close its doors far too early. Even seemingly insignificant fees and forms can add up to have a detrimental effect. Government should support the following solutions:
- Create a single list of all requirements to start any business and easy-to-understand guides that walk entrepreneurs through the permitting process. These should be translated into multiple languages and posted in public offices and in an easy-to-find location online.
- Require coordination across agencies to simplify all federal, state, and local procedures, forms, licenses, and permits required to start a business.
- Create federal and state incentives for local authorities to reduce barriers to starting businesses, even down to the smallest fees and forms.
- Nearly three-quarters of entrepreneurs agree that government regulations on businesses are complex and hard to follow.
- Sixty-three percent of entrepreneurs believe it is too time-consuming for business owners to stay legally compliant with local, state, and federal regulations.
- During the COVID-19 pandemic, 52% of entrepreneurs with a new business under 1 year old identified laws, polices, and regulations as a challenge.
RESOURCE: One tool governments can use to assess and improve their online business registration processes is the Global Enterprise Registration. The Global Enterprise Registration provides a website assessment tool that allows administrators to evaluate their own sites and see how their online processes for registering a business can be improved.
In response to the COVID-19 pandemic, many cities have adapted their local rules and regulations around starting and operating a business. In November 2020, San Francisco voters approved a broad ballot measure to streamline and simplify the process of starting a business, including by allowing all applications for storefront use to be reviewed within 30 days (compared with the months it would previously take), ensuring parallel cross-department application reviews to speed up the application process, and relaxing zoning ordinances and regulatory rules. San Francisco is also modernizing zoning restrictions to allow businesses to open more quickly by making more businesses eligible for streamlined approval in neighborhood commercial zones.