Closing a business, for beginners -- for anyone -- can be an overwhelming experience. Most small business owner "beginners" are seasoned pros who never thought they'd be closing a business. You may be disappointed that you're closing a business, but if it has to be done, it has to be done; putting it off will only make matters worse.

Common questions you may be asking yourself include: What steps do I need to take? How do I tell my customers? What do I do with all these unsold products? While closing a business isn't a walk in the park, you can make it a little less painful and a lot less confusing. Consider some tips for closing a business:

1. Choose whether you want to go out quietly or with a bang. For some companies, posting a small sign indicating your closure is all that's needed.

2. Make sure to take care of any legalities involved in closing a business. Mind your step regarding federal, state and local laws.

3. Sell off your assets. This includes not only inventory, but also capital equipment that you no longer need since you're closing a business.

Action Steps
The best contacts and resources to help you get it done

Let your customers know you're closing a business

This will vary between types of businesses. A company that sells convenience products may not have an established customer base, so there's no need to individually let customers know that you're closing. On the other hand, if you run a high-end service business and have regular clients, you'll want to let them know personally. While you don't owe anyone an explanation, people will ask you why you're closing, so maybe going quietly is best for you. Referring your best customers elsewhere is also a good idea.

I recommend: Put up one of the signs made by VictoryStore.com. Some of them are humorous, and maintaining your sense of humor during this time can help reduce your stress. Send "going out of business" letters to your best clients using the format at 4hb.com; there are also other letter templates there that may be of use to you.

Take care of closing a business from a legal standpoint

Don't overlook your legal loose ends. This includes paying final wages and filing W2s or 1099s, making official corporate notice of your closing (unless you're a sole proprietor), paying shareholders if you have them and arranging for discontinuation of benefit plans like pensions and insurance. Don't forget to close any utility accounts, like Internet service, as well as cancel any services, like lawn care.

I recommend: Look through the checklist offered by the Internal Revenue Service to see which actions you need to take. There is also a helpful checklist at HowToSellaBusiness.org. Check with your local Small Business Administration to find out about any rules your state or municipality imposes upon businesses that are closing.

Liquidate inventory, equipment and fixtures before closing a business

Getting rid of your inventory can not only turn some profits but save you the headache of putting things in storage. One tactic is to start by selling products for 10% off the original price and slowly increase the discount as time goes on. You could also have a big inventory liquidation blowout to try to move all the products in a short period of time. Make sure to advertise any sales you've having, as consumers won't come take advantage of your discounts if they don't know what you're offering.

I recommend: Consider the advice from Small Business Notes regarding asset liquidation. Effective Inventory Management has several suggestions about getting rid of your inventory. If you don't feel that you can handle a large-scale liquidation on your own, consider hiring an expert, as is suggested by the Work.com Guide to Business Liquidation Basics.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  For the future, you can take your experience with operating and closing a business and learn from it: There are plenty of successful people who once looked into closing a business for beginners.

Ending a business is not always a bad thing. Sometimes it may mean the start of retirement or the beginning of a new business venture. Whether your business is a sole proprietorship, a partnership or a corporation it is always good to make a plan for your business closing. In some cases you may choose to sell the business but in other cases business closure is necessary. Failed businesses typically are not marketable and are closed.

When closing a business, it is important to get as much equity out of the business as possible. One way to do this is through the liquidation of business assets and inventory. While going out of business, keep the following in mind:

1. Time the closing of your business well.

2. Plan your exit strategy.

3. Outline your steps to closing a business.

Action Steps
The best contacts and resources to help you get it done

Decide on a business closing

If you are a sole proprietor, the decision to close your business is yours alone. However, if your business is a corporation, limited liability company (LLC) or partnership, a vote must be taken and the decision to close must be agreed upon by whatever percentage is required by your state's business statutes. If your business is a corporation or a LLC it must be officially dissolved so you are no longer responsible for tax filings.

I recommend: Check your state's business state's business statutes regarding closing a business. NOLO provides links to all state business statutes. The forms needed for dissolving your business, if you are a corporation or a LLC, are available from the secretary of state website for you state. State and Local Government on the Net provides links to each state's secretary of state website.

Do the paperwork for ending a business

Cancel all licenses and permits that your business has with your state and local government. If you have been using a business name, file an abandonment of your business name with your county clerk's office. After your employees and customers have been notified of your business closure, publish the abandonment of your business name in your local newspaper so your community knows that any further dealings they do with a business under that name is no longer yours. File all necessary forms with the IRS.

I recommend: The Internal Revenue Service provides a checklist of forms for going out of business. The IRS TaxMap provides answers to questions. Use an attorney that specializes in business closing if you need help or advice.

Get help with closing a business basics

There are resources available for the small business owner to make the transition out of business an easier one. Turn to other business owners, small business owner organizations, and use resources available on the Internet to make sure you do not overlook anything while closing your business.

I recommend: Volunteers at Score offer advice and help to business owners free of charge. The U.S. Small Business Administration (SBA) offers assistance and information on how to liquidate and close a small business. FindLaw provides a checklist to keep you organized while going out of business.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  If your business has employees, notify them of your closing, before you notify customers or make any public announcements. Let them know their last date of employment and when they will receive their last paycheck. Your state may also require you pay them the value or accrued unused vacation time.
• •  Consider business closure implications for your customers. Settle all accounts with your customers and collect on any outstanding debt, before telling your customers that your business is closing. Notify your customers of your business closing and fulfill any contractual obligations to them or refund their money, before going out of business. Invite them to a 'Going Out of Business Sale.'

In the life of many a business either large or small, there comes a time when it becomes necessary to disassemble everything and close up shop for good, and lots of business leaders at some point in time look for help on closing a business. Smaller shops can look to the examples of larger companies that are forced to close up, and they can also get news from the larger business community to help figure out how the closing process is done efficiently and with regard to financial safety.

The web can be a great resource for those facing a closure and looking for "closing a business news and trends" -- lots of resources on the net go through the various details of what is necessary for facing this unfortunate situation head on and getting the deal done in a way that will minimize financial damage, and in some cases, even allow for a "rebirth" of the assets in another form. Readers can find:

1. General news on closing a business, including tax, legal and financial guides.

2. More on liquidation of inventories and all that goes along with closing the doors for good.

3. Additional resources on how to go about selling a business.

Action Steps
The best contacts and resources to help you get it done

Find general resources for closing a business

There's a lot online to help a struggling business owner arrange for all of the necessities of closing up shop, including all of the liabilities that might exist without proper attention to recording just how a closure is done and what happens to payroll and operations. Read through detailed web pages to get a full 'laymans view' on closing a business.

I recommend: For the "latest news" on what the government wants you to do in a business closing, check out the IRS handy Closing a Business Checklist. Use Yahoo Business (a big business news source online) to help with getting more of the help you need to figure out this big step. Get more general resources on closing a business from sites like DogPile online.

Find closing a business resources on liquidation

For any business that involved physical inventories, this step is a big one. Finding out how to deal with depleting stored resources is one of the challenges that faces top brass in close-out scenarios. Get help from web sources on how this is generally done, and look out for the fine print in partnerships with third party liquidation 'helpers.'

I recommend: Find online articles on the "art" of liquidation from Business Week. For more liquidation news from various big media outlets on the web, try Encyclopedia.com.

Look for help with selling a business when closing a business

So you're selling off everything at huge losses? Not so fast -- in many cases, a business is worth something, no matter what kind of business it is. Even without material assets, many businesses have other value, so take a look and see if you can put your existing business on the market to recoup some reward for your efforts.

I recommend: To see what some of today's outgoing shops are selling for, try the Business Exchange online. For some "checklist/guide" news resources on the subject, take a look at US News.