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Starting your own business isn't just the American dream, it's the lifeblood of the U.S. economy. According to the United States Small Business Administration, small businesses employ half of all private sector employees and have generated between 60 and 80 percent of new jobs in the last decade.

But before you go hanging that OPEN FOR BUSINESS sign in the window, keep in mind that no less than a third of small businesses fail within the first two years. Look over these suggested guidelines to avoid an early closing …

Turn your dream into a plan. While it's easy to visualize yourself running something, the question of what has a tendency to remain foggy. Try answering these six questions to get a better idea of what sort of business you'd like to run:

1. Is it something you know how to do?
2. Is it something you like enough that you could stand doing it day after day?
3. Is it something with a broad enough appeal that you could sell on a steady basis?
4. Can it be sold at a price that is reasonable to consumers and will also cover expenses and overhead while returning a profit?
5. Who would your competition be?
6. Do you think you can raise enough money to get your business through the "up and running" period and toward profitability?

Name that business. Depending on your personality, coming up with an appropriate business name could either be one of the most enjoyable aspects of starting a business or the most insufferable. Whatever your opinion, it's a crucial piece of the puzzle, especially for those businesses just starting out.

Try to avoid using a name that is overly long or difficult to pronounce. Also avoid jockeying for position in the Yellow Pages—it might have been clever to name your business A-Plus Locksmith twenty years ago, but things have gotten a bit out of hand on that front. (Just ask Western Lock and Safe of Denver, Colo., formerly known as AAAAA Locksmith.)

You might also want to steer clear of picking a name that limits your business's growth or potential customer base. For example, don't name the company Bob's Refrigerator Repair if Bob is also willing to fix dishwashers.

Be a smart borrower. Unless you've recently experienced some sort of financial windfall, chances are you'll need to apply for a business loan.

"Starting a business requires you to complete a number of steps and make some key decisions, [but] determining which financing options will meet your short-term needs and long-term goals is crucial," said Ellen Thrasher, director of the SBA's Office of Business and Community Initiatives, which has developed an interactive business tool for aspiring entrepreneurs called the "Small Business Primer." 

But if you've never taken out a business loan, you've got no credit history to indicate that the loan will be repaid on time. No matter how great your idea may be, lenders won't be so willing to hand money over to someone they consider a stranger.

Hence, a credit history needs to be established. Consider borrowing money you don't need, then repaying the loan — on time — to establish a positive relationship with the lender so that you can apply for the kind of loan you want. And when it comes time to apply for that much-needed loan, be sure to account exactly where the money will be allocated. This allows the lender to see exactly where the money is going, and it indicates how much money can be retrieved from stuff like equipment and inventory should you be forced to default.

That said, let lenders know that the money you're asking for is a nothing more than a stepping stone toward the higher goal of running a self-sufficient business. Displays of confidence and fortitude still go a long way.

Don't forget about security. Most small businesses don't have their own security guards and are therefore quite popular among burglars, vandals and armed robbers. And since most small businesses lack the financial foundation created by years and years of steady growth, all it takes is one major crime to close up shop.

When starting a small business, consider investing in a video surveillance and alarm system. If these measures prove to expensive, at least keep the property well-lit at all times and arrange the cash register so that it sits front-and-center (that way, passers-by can see if you are being robbed). If you plan on working from home, be cautious of unexpected visitors.

Know your tax situation. Running a profitable business might be the American dream, but the IRS has a way of bringing Americans back to reality. Before you go confidently in the direction of your dreams, consult a financial planner. Whether you're thinking about starting a boardwalk yogurt stand or creating a home office, there's a world of tax issues you'll first want to explore.