by: Stephen L. Nelson, CPA
A small business accounting program should accomplish three tasks: track income and expenses, generate business forms, and keep detailed records for other assets and liabilities.
Tracking Income and Expenses
The task of tracking a business’s income and expense is really the most important job of an accounting system. If you own or manage a small business, obviously, you need some tool for measuring your income and your cash flow.
Although checkbook programs like Quicken and Microsoft Money does little more than keep a checkbook, you can actually keep financial records for a business right out of a checkbook. To do this, you simply categorize deposits as falling into some income category. And when you write a check or make some other withdrawal, you categorize expenses as falling into some expense category.
One problem with using a checkbook program, however, is that by using a checkbook program, you are implicitly using cash-basis accounting to track your income and expenses. Cash-basis accounting counts income when you receive a deposit and counts expense when you write a check.
Cash-basis accounting is easy to understand, and that means you are less likely to make errors in implementing it. However, cash-basis accounting is generally too imprecise for more complicated businesses. If you use inventory in your business, for example, cash-basis accounting isn’t very accurate—and the Internal Revenue Service does not allow it.
And there are other circumstances, too, in which cash-basis accounting produces serious and usually unacceptable errors in precision. For example, if you often receive money before you have actually earned it or if you often incur expenses long before you actually have to pay for them, you need to use a more sophisticated accounting program than a checkbook program.
Generating Business Forms
The second task that a small business accounting program should help you with is the generation of business forms. The most common business form is simply a check. Any checkbook program help you do this. Other business forms that small businesses commonly need to produce include invoices, credit memos, monthly statements, purchase orders, and so forth.
If you have a small business with very simple form requirements—perhaps you need only checks—then a checkbook program may work very well for you.
However, if you have extensive or complicated business form generation requirements, a more full-featured small business accounting package, such as Intuit’s QuickBooks, Peachtree’s Complete Accounting, or Microsoft Small Business Accounting will do a better job for you.
If you produce more complicated forms, but you produce these other forms with a word processing program, then a checkbook program may still work for you.
Detailed Record Keeping for Other Assets and Liabilities
The third task that a small business accounting program should help you with is detailed record keeping of your most important assets and liabilities. A checkbook program lets you keep good detailed records of cash, and for some businesses that is the principal asset. But many small businesses have other significant assets and liabilities they need to track, for example, accounts receivables, inventory, and vendor payables.
Whether or not a particular software program’s accounting tools provide adequate asset and liability record keeping depends on the situation. However, no small business accounting program does everything you need it to do. Any accounting program that provides an extensive list of features, by its very nature, becomes a challenge to use. For example, moving to the accrual basis of accounting adds an entire layer of complexity to financial record keeping, and keeping detailed records of inventory adds another layer.
For these reasons, even when a particular program doesn’t do everything you need it to do, your best choice still may be to use the program—and then simply live with its shortcomings.
Monday 11 August 2008
What are the benefits of blogging for small business?
by: Kelly ONeil
Copyright 2005 UpLevel StrategiesBlogging has become quite popular for small businesses as of late. I have noticed on PR Leads that there are several story requests for experts to talk about the benefits of blogging for small businesses. So, I decided I better do my homework and see what this is all about. It turns out that there are several benefits to blogging for small businesses. Here are the most important ones:1. Blogging Software is Super Easy to Use: Simply write your thoughts, link to resources, and publish to your blog, all at the push of a few buttons. I use the software blogger.com. It took me 2 minutes to set up my account and 3 minutes to publish my first blog. Check out my blog at: http://uplevelstrategies.blogspot.com/2. Build Relationships Online: Business blogs provide your small business with a chance to share your expertise and knowledge with a larger audience. You have the opportunity to share a piece of yourself with your community allowing them to get to know you better.3. Higher Search Engine Rankings: Search engine marketing is hot. Business bloggers are achieving top search engine rankings because search engines rank based on link popularity and easy to index regular content among other factors. Learning the basic skills of search engine optimization and good content management are keys to better rankings for bloggers.4. Easy Communication: The biggest benefit of Blogging or RSS (see definition below) for your web audience can prove to be a better solution for notification than websites themselves or email. As indicated by Bill Gates in a speech at the Microsoft CEO Summit 2004 in Redmond, Washington: “if you just put information on a Web site, then people don't know to come visit that Web site, and it's very painful to keep visiting somebody's Web site and it never changes. It's very typical that a lot of the Web sites you go to that are personal in nature just eventually go completely stale and you waste time looking at it… And so, getting away from the drawbacks of e-mail -- that it's too imposing -- and yet the drawbacks of the Web site -- that you don't know if there's something new and interesting there – this [blogs & RSS] is about solving that.”Definitions:RSS - RSS is an acronym for Rich Site Summary, an XML format for distributing news headlines on the Web, also known as syndication. First started by Netscape as part of the My Netscape site, it expanded through Dave Winer and Userland.Blog - Weblog, web log or simply a blog, is a web application which contains periodic posts on a common webpage. These posts are often but not necessarily in reverse chronological order. Such a website would typically be accessible to any Internet user.(c) Kelly O’Neil 2005
Copyright 2005 UpLevel StrategiesBlogging has become quite popular for small businesses as of late. I have noticed on PR Leads that there are several story requests for experts to talk about the benefits of blogging for small businesses. So, I decided I better do my homework and see what this is all about. It turns out that there are several benefits to blogging for small businesses. Here are the most important ones:1. Blogging Software is Super Easy to Use: Simply write your thoughts, link to resources, and publish to your blog, all at the push of a few buttons. I use the software blogger.com. It took me 2 minutes to set up my account and 3 minutes to publish my first blog. Check out my blog at: http://uplevelstrategies.blogspot.com/2. Build Relationships Online: Business blogs provide your small business with a chance to share your expertise and knowledge with a larger audience. You have the opportunity to share a piece of yourself with your community allowing them to get to know you better.3. Higher Search Engine Rankings: Search engine marketing is hot. Business bloggers are achieving top search engine rankings because search engines rank based on link popularity and easy to index regular content among other factors. Learning the basic skills of search engine optimization and good content management are keys to better rankings for bloggers.4. Easy Communication: The biggest benefit of Blogging or RSS (see definition below) for your web audience can prove to be a better solution for notification than websites themselves or email. As indicated by Bill Gates in a speech at the Microsoft CEO Summit 2004 in Redmond, Washington: “if you just put information on a Web site, then people don't know to come visit that Web site, and it's very painful to keep visiting somebody's Web site and it never changes. It's very typical that a lot of the Web sites you go to that are personal in nature just eventually go completely stale and you waste time looking at it… And so, getting away from the drawbacks of e-mail -- that it's too imposing -- and yet the drawbacks of the Web site -- that you don't know if there's something new and interesting there – this [blogs & RSS] is about solving that.”Definitions:RSS - RSS is an acronym for Rich Site Summary, an XML format for distributing news headlines on the Web, also known as syndication. First started by Netscape as part of the My Netscape site, it expanded through Dave Winer and Userland.Blog - Weblog, web log or simply a blog, is a web application which contains periodic posts on a common webpage. These posts are often but not necessarily in reverse chronological order. Such a website would typically be accessible to any Internet user.(c) Kelly O’Neil 2005
Secret Strategies Of The Gurus: Guru 1 - Bill Gates As A Small Business Entrepreneur
: Rick Tanzo
Introduction: Strategies are strategies. Dismiss for a moment from your mind what some people are saying about Bill Gates's offensive practices he used to transform himself from a small business entrepreneur to a titan in the business world. There are yet honest-to-goodness strategies we can glean from his sleeves. We can study, learn from them and possibly apply them in our own home based business. Upon this premise that this article was written. Strategy of Bill Gates - Have a Vision: At the outset, I will lay down the results of my research on one secret strategy of Bill Gates. He used the same strategy to jump-start his small business to today's business behemoth. Based on my research, the strategy of Bill Gates is grounded upon the following: "Have a VISION of what you want to achieveand hold on to that vision come wrath or high water." His vision was:"A Personal Computer on every desk."By the way, I didn't want to use the grammatically correct expression "come hell or high water" - for personal reason - so excuse my grammatical preference. Anyway, let's go back to our subject. When you have a vision, you can make the impossible possible. Almost everybody is familiar about how once upon a time the small business entrepreneur Bill Gates secured mighty IBM's contract to supply the latter's operating system. When he was negotiating with the IBM people, he had no operating system as yet. He was able to buy a Disk Operating System or DOS for $50 thousand. In the end, he got the contract. Why?Bill Gates was guided by his vision - that every desk all over the world should have a computer on it. This vision enabled him to provide IBM with a DOS operating system and have control over it including to whom he wanted it sold to.Beginning Entrepreneur: Before he became an entrepreneur, Bill Gates had nurtured the vision that software will one day rule the world. During high school he spent many late nights with friend Paul Allen tinkering with the school's computer system. He dropped out of college after completing his junior year at Harvard. Instead, he and his bosom friend Paul Allen set up a small business - a software company - in far away New Mexico. This move was in accordance with his vision.His vision became clearer as he moved from a total newbie to one with a small business to keep. His vision was clothed in clearer terms, as he negotiated the DOS deal with IBM.Better late than never: Bill Gates's company ultimately became the leader in the software arena. During the first half of the 1990's - 1993 to be exact - he was among the last of the software titans to acknowledge the future significance of the Internet. But once he did realize that indeed Internet was the wave of the future, he had the tenacity to reshape his vision. His vision retained its old flavor - that is, software dominance in commerce, industry and in every field. It was rehashed in his own words as follows: "In the years ahead, the Internet will have an even more profound effect on the way we work, live and learn … this technology will be one of the key cultural and economic forces of the early 21st century."At this moment in time, Bill Gates is guided by the vision that the Internet is the wave of the present and the foreseeable future.Lessons Learned:You can learn from Bill Gates by having your own vision for your small business. Lay down this vision in your mind. Then put it into writing. Read your vision everyday while at work in your small corner of the house. Your vision could be as short-term as the following:"To make my web site land within the top five of Google when people search for the keywords 'home based business,'" or"$200,000 earning this year from Google Adsense,"or"To enrich the content of my web site using the theme 'scrap book making.'"Do not limit yourself to short-term vision. Aim for the long-term. A five to ten years period would suffice. Technology may change but your vision will essentially be the same. You may refine it if deemed necessary, like incorporating the effect of technological changes - as Bill Gates did. Your Share of the Pie:Everybody - from Bill Gates down to your netpreneur friend - has recognized the tremendous role of the Internet in business developments. Some of the more immediate pressing concerns you should consider at this stage concerning your home based business are the following:- General preference for digital transactions by clients. For example, as a beginning Internet entrepreneur you should meet your clients' demands who favor the use of online payment system. At this juncture, I would like to refer you to my web site at InternetMarketingLearningCenter.com which offers free learning stuff on Internet marketing and home based business. One category being tackled in the web site is the online payment system. You may read online news and keep yourself abreast of the best software companion for your small business.- Choose products that are preferred by people at this time when the Internet is dominating people's lives. It has been determined that information products and web shopping are favored by most consumers. Information products include your very own ebooks and "how-to" manuals.- Make it your aim that your products are cheap, very useful, and the best among the rest of competing products. This applies most especially to shopping products. For your own digital products, you have the advantage of pricing them according to your own estimation. You as the author of your own digital product determines the price level. It is no wonder why gurus like Jay Abraham, Jim Daniels and the late Corey Rudl have become so wealthy from selling their own digital pieces.As for these three, they will be among the titans that we will tackle in future issues of this series.
Introduction: Strategies are strategies. Dismiss for a moment from your mind what some people are saying about Bill Gates's offensive practices he used to transform himself from a small business entrepreneur to a titan in the business world. There are yet honest-to-goodness strategies we can glean from his sleeves. We can study, learn from them and possibly apply them in our own home based business. Upon this premise that this article was written. Strategy of Bill Gates - Have a Vision: At the outset, I will lay down the results of my research on one secret strategy of Bill Gates. He used the same strategy to jump-start his small business to today's business behemoth. Based on my research, the strategy of Bill Gates is grounded upon the following: "Have a VISION of what you want to achieveand hold on to that vision come wrath or high water." His vision was:"A Personal Computer on every desk."By the way, I didn't want to use the grammatically correct expression "come hell or high water" - for personal reason - so excuse my grammatical preference. Anyway, let's go back to our subject. When you have a vision, you can make the impossible possible. Almost everybody is familiar about how once upon a time the small business entrepreneur Bill Gates secured mighty IBM's contract to supply the latter's operating system. When he was negotiating with the IBM people, he had no operating system as yet. He was able to buy a Disk Operating System or DOS for $50 thousand. In the end, he got the contract. Why?Bill Gates was guided by his vision - that every desk all over the world should have a computer on it. This vision enabled him to provide IBM with a DOS operating system and have control over it including to whom he wanted it sold to.Beginning Entrepreneur: Before he became an entrepreneur, Bill Gates had nurtured the vision that software will one day rule the world. During high school he spent many late nights with friend Paul Allen tinkering with the school's computer system. He dropped out of college after completing his junior year at Harvard. Instead, he and his bosom friend Paul Allen set up a small business - a software company - in far away New Mexico. This move was in accordance with his vision.His vision became clearer as he moved from a total newbie to one with a small business to keep. His vision was clothed in clearer terms, as he negotiated the DOS deal with IBM.Better late than never: Bill Gates's company ultimately became the leader in the software arena. During the first half of the 1990's - 1993 to be exact - he was among the last of the software titans to acknowledge the future significance of the Internet. But once he did realize that indeed Internet was the wave of the future, he had the tenacity to reshape his vision. His vision retained its old flavor - that is, software dominance in commerce, industry and in every field. It was rehashed in his own words as follows: "In the years ahead, the Internet will have an even more profound effect on the way we work, live and learn … this technology will be one of the key cultural and economic forces of the early 21st century."At this moment in time, Bill Gates is guided by the vision that the Internet is the wave of the present and the foreseeable future.Lessons Learned:You can learn from Bill Gates by having your own vision for your small business. Lay down this vision in your mind. Then put it into writing. Read your vision everyday while at work in your small corner of the house. Your vision could be as short-term as the following:"To make my web site land within the top five of Google when people search for the keywords 'home based business,'" or"$200,000 earning this year from Google Adsense,"or"To enrich the content of my web site using the theme 'scrap book making.'"Do not limit yourself to short-term vision. Aim for the long-term. A five to ten years period would suffice. Technology may change but your vision will essentially be the same. You may refine it if deemed necessary, like incorporating the effect of technological changes - as Bill Gates did. Your Share of the Pie:Everybody - from Bill Gates down to your netpreneur friend - has recognized the tremendous role of the Internet in business developments. Some of the more immediate pressing concerns you should consider at this stage concerning your home based business are the following:- General preference for digital transactions by clients. For example, as a beginning Internet entrepreneur you should meet your clients' demands who favor the use of online payment system. At this juncture, I would like to refer you to my web site at InternetMarketingLearningCenter.com which offers free learning stuff on Internet marketing and home based business. One category being tackled in the web site is the online payment system. You may read online news and keep yourself abreast of the best software companion for your small business.- Choose products that are preferred by people at this time when the Internet is dominating people's lives. It has been determined that information products and web shopping are favored by most consumers. Information products include your very own ebooks and "how-to" manuals.- Make it your aim that your products are cheap, very useful, and the best among the rest of competing products. This applies most especially to shopping products. For your own digital products, you have the advantage of pricing them according to your own estimation. You as the author of your own digital product determines the price level. It is no wonder why gurus like Jay Abraham, Jim Daniels and the late Corey Rudl have become so wealthy from selling their own digital pieces.As for these three, they will be among the titans that we will tackle in future issues of this series.
How To Find And Sell to Your Small Business Niche
by: Robert Moment
Any given market in its entirety is simply too vast for any business but the largest of corporations to properly undertake. Therefore, the most lucrative strategy for smaller businesses is dividing the potential demand into different manageable market niches, from which you can offer specialized goods and services, for attracting a specific group of those prospective clients.There are, without a doubt, some types of products or services for which you are particularly suited to providing. Have a good look at the market, and you will be certain to find some ideal opportunities. So what does finding a niche really mean for your small business? Identifying your small business niche means that you are discovering a distinct corner in the market, for your business to provide to a certain specific customer interest - and then capitalizing on it. It means that you find that one special spot within the business world where you stand out the most.Now that you know exactly what a niche is, there are certain things that you need to find out about yourself and your small business before you take a look at that ever-reaching industry you're looking to tackle. Ask yourself:* What is my company good at/what am I good at? When you answer this question, have a good look at your skills, and those within your current business. Find the areas in which your strongest skills lie, and list them. You may be surprised at what you discover. Performing this type of inventory really brings out the strengths as well as the potential of your business.* What do I enjoy doing? What are the things that you love to do the most both in a business scenario, or even when there is not a profit available. The best place to start looking, is at your hobbies. These are the things that you enjoy the most, and into which you're likely willing to invest a fairly significant amount of money. Therefore, you can potentially translate this particular passion into profit. This will not only make your business a more enjoyable venture, but it will also provide you with additional stamina and focus, which is crucial in starting a new business, or redirecting the focus of an existing business.* What is needed? Now that you know what you can do well, and what you like to do, it's important to assess these things with regards to what customers are willing to buy. To find out what is needed, you'll want to look into your potential customers, you'll need to examine what is already being purchased, and consider trends for the future. Sound daunting? Actually, it's simpler than you think. As you research a niche for your own operation, perform a market survey and contemplate its results in order to discover the areas which have already been adequately saturated by your competitors. Place all of the gathered information into a table or a graph in order to illustrate where openings may exist for your products or services. Concentrate on finding the proper arrangement of products, services, quality, and price, in order to be certain that competition is as indirect as possible. Regrettably, there is no universally guaranteed strategy for making those comparisons, however, the more thorough your examinations of the marketplace, the more accurate, practical, and successful your factual information and your "gut" instincts will be. The reason for the lack of a cast iron formula for discovering where competition is the most thin is due to the vast range in the desired attributes within any industry, as well as a certain imaginative element which simply cannot be formalized. There needs to be a proper balance between competition, and actual client interest in your product or service.As you brainstorm for fantastic small business niche ideas, keep in mind that the heart of any successful venture is providing a product or a service that will be purchased in quantity by others. To do this, you will need to satisfy the needs of your target market, and in return, your target market will keep your small business healthy, happy, and (best of all) profitable.By designing a quality database (or having one designed for you by a professional in the industry), you will be better able to sift through all of the market information available, in order to make a qualified decision about particular market segments which may not otherwise be obvious.For example, do clients within a certain geographic region, or government agency or department typically buy products combining high quality and high price, or does that area look for the more "economical" choice? Do the customers from the market niche that you are considering tend to utilize customer service opportunities on a more regular basis? When you have the answer to these questions, you will be able to custom-tailor your business to meet the needs of that niche, making your business the obvious choice.But where does one find all of this spectacularly handy information? The Internet is a natural, and highly effective solution. The Internet has become possibly the most broad and valuable source of current information for today's small business. If you were a corporation, it would be easy to simply hire a team to discover the proper niche in the market for your business, however, as a small business, certain financial limitations step into place. Therefore, the Internet provides you with a tool to somewhat level the playing field. You can take all the information gathered by corporations, large companies, small enterprises, and home businesses alike, and apply them to your own business in order to discover what the world has to offer you.Information about almost any product or service available around the globe is simply a mouse-click away. Brainstorm, ponder, and research all of the questions that can be relevant to your market, and then use the Internet to narrow down all of the information Remember, though, once you do target a new niche market, make certain that this niche doesn't conflict with your overall business plan. Your niche has to be within the realm of possibilities for your company and your potential.Finding your own little niche in the enormous marketplace is a fantastic way to maximize the success potential of your small business. Primarily because your largest direct competitor... is you!
Any given market in its entirety is simply too vast for any business but the largest of corporations to properly undertake. Therefore, the most lucrative strategy for smaller businesses is dividing the potential demand into different manageable market niches, from which you can offer specialized goods and services, for attracting a specific group of those prospective clients.There are, without a doubt, some types of products or services for which you are particularly suited to providing. Have a good look at the market, and you will be certain to find some ideal opportunities. So what does finding a niche really mean for your small business? Identifying your small business niche means that you are discovering a distinct corner in the market, for your business to provide to a certain specific customer interest - and then capitalizing on it. It means that you find that one special spot within the business world where you stand out the most.Now that you know exactly what a niche is, there are certain things that you need to find out about yourself and your small business before you take a look at that ever-reaching industry you're looking to tackle. Ask yourself:* What is my company good at/what am I good at? When you answer this question, have a good look at your skills, and those within your current business. Find the areas in which your strongest skills lie, and list them. You may be surprised at what you discover. Performing this type of inventory really brings out the strengths as well as the potential of your business.* What do I enjoy doing? What are the things that you love to do the most both in a business scenario, or even when there is not a profit available. The best place to start looking, is at your hobbies. These are the things that you enjoy the most, and into which you're likely willing to invest a fairly significant amount of money. Therefore, you can potentially translate this particular passion into profit. This will not only make your business a more enjoyable venture, but it will also provide you with additional stamina and focus, which is crucial in starting a new business, or redirecting the focus of an existing business.* What is needed? Now that you know what you can do well, and what you like to do, it's important to assess these things with regards to what customers are willing to buy. To find out what is needed, you'll want to look into your potential customers, you'll need to examine what is already being purchased, and consider trends for the future. Sound daunting? Actually, it's simpler than you think. As you research a niche for your own operation, perform a market survey and contemplate its results in order to discover the areas which have already been adequately saturated by your competitors. Place all of the gathered information into a table or a graph in order to illustrate where openings may exist for your products or services. Concentrate on finding the proper arrangement of products, services, quality, and price, in order to be certain that competition is as indirect as possible. Regrettably, there is no universally guaranteed strategy for making those comparisons, however, the more thorough your examinations of the marketplace, the more accurate, practical, and successful your factual information and your "gut" instincts will be. The reason for the lack of a cast iron formula for discovering where competition is the most thin is due to the vast range in the desired attributes within any industry, as well as a certain imaginative element which simply cannot be formalized. There needs to be a proper balance between competition, and actual client interest in your product or service.As you brainstorm for fantastic small business niche ideas, keep in mind that the heart of any successful venture is providing a product or a service that will be purchased in quantity by others. To do this, you will need to satisfy the needs of your target market, and in return, your target market will keep your small business healthy, happy, and (best of all) profitable.By designing a quality database (or having one designed for you by a professional in the industry), you will be better able to sift through all of the market information available, in order to make a qualified decision about particular market segments which may not otherwise be obvious.For example, do clients within a certain geographic region, or government agency or department typically buy products combining high quality and high price, or does that area look for the more "economical" choice? Do the customers from the market niche that you are considering tend to utilize customer service opportunities on a more regular basis? When you have the answer to these questions, you will be able to custom-tailor your business to meet the needs of that niche, making your business the obvious choice.But where does one find all of this spectacularly handy information? The Internet is a natural, and highly effective solution. The Internet has become possibly the most broad and valuable source of current information for today's small business. If you were a corporation, it would be easy to simply hire a team to discover the proper niche in the market for your business, however, as a small business, certain financial limitations step into place. Therefore, the Internet provides you with a tool to somewhat level the playing field. You can take all the information gathered by corporations, large companies, small enterprises, and home businesses alike, and apply them to your own business in order to discover what the world has to offer you.Information about almost any product or service available around the globe is simply a mouse-click away. Brainstorm, ponder, and research all of the questions that can be relevant to your market, and then use the Internet to narrow down all of the information Remember, though, once you do target a new niche market, make certain that this niche doesn't conflict with your overall business plan. Your niche has to be within the realm of possibilities for your company and your potential.Finding your own little niche in the enormous marketplace is a fantastic way to maximize the success potential of your small business. Primarily because your largest direct competitor... is you!
Business Disaster? Won't Happen to Me
by: Denise OBerry
Copyright 2005 Denise OBerryAs fast as you can say business disaster, your business can go up in smoke. That's what happened a while back to Castle Carpet One. Gone were thousands of dollars worth of equipment and carpet, plus two smaller businesses that were housed in the same building. Luckily the owners, Larry and Diane Cox, had plenty of business insurance to cover their physical losses. But they lost their most important business asset - customer records - because of failed back up systems. Rebuilding their customer base will be tough and the long-term revenue impact is hard to measure. With disasters like hurricanes, tornados, fires, floods and terrorism, to name a few, it's critical for small companies to have a disaster plan. And for companies with only one location, it's even more important. One location companies have the potential to lose the entire business if disaster strikes. For a home-based business, it's even worse. You could lose your home and your business in one swoop. Any small business owner can minimize the damage by simply having proactive strategies in place to deal with an emergency when it happens. What if: - You arrive at your business to find it vandalized and all of your customer records missing? - Your most critical employee becomes ill and requires an extended absence? - Your computer hard drive (or network) crashes? - You become the primary care giver for a sick family member? - You become ill and can't manage your customer commitments? - Your business becomes inaccessible because of an emergency on your street? What would you do? Would your business survive? What would you grab if you had to leave your business quickly? After the emergency, how would you communicate with your employees? Customers? How long would it take to get back to business as usual? Without a disaster plan, you'll have a harder time getting back to work. Most businesspeople think it will just take two or three days. That's tough to do if you have no plan for action and little money to move forward. The reality, experts say, is more like several months and at least 25 percent of businesses that experience a disaster never reopen. But most small business owners just don't make time for planning. We think it's "never going to happen to us." It could. The time to formalize a game plan for an emergency is before it happens. Do it now.
Copyright 2005 Denise OBerryAs fast as you can say business disaster, your business can go up in smoke. That's what happened a while back to Castle Carpet One. Gone were thousands of dollars worth of equipment and carpet, plus two smaller businesses that were housed in the same building. Luckily the owners, Larry and Diane Cox, had plenty of business insurance to cover their physical losses. But they lost their most important business asset - customer records - because of failed back up systems. Rebuilding their customer base will be tough and the long-term revenue impact is hard to measure. With disasters like hurricanes, tornados, fires, floods and terrorism, to name a few, it's critical for small companies to have a disaster plan. And for companies with only one location, it's even more important. One location companies have the potential to lose the entire business if disaster strikes. For a home-based business, it's even worse. You could lose your home and your business in one swoop. Any small business owner can minimize the damage by simply having proactive strategies in place to deal with an emergency when it happens. What if: - You arrive at your business to find it vandalized and all of your customer records missing? - Your most critical employee becomes ill and requires an extended absence? - Your computer hard drive (or network) crashes? - You become the primary care giver for a sick family member? - You become ill and can't manage your customer commitments? - Your business becomes inaccessible because of an emergency on your street? What would you do? Would your business survive? What would you grab if you had to leave your business quickly? After the emergency, how would you communicate with your employees? Customers? How long would it take to get back to business as usual? Without a disaster plan, you'll have a harder time getting back to work. Most businesspeople think it will just take two or three days. That's tough to do if you have no plan for action and little money to move forward. The reality, experts say, is more like several months and at least 25 percent of businesses that experience a disaster never reopen. But most small business owners just don't make time for planning. We think it's "never going to happen to us." It could. The time to formalize a game plan for an emergency is before it happens. Do it now.
The Power of Small Business Branding Through Private Labeling
by: Jake Mayer
Please consider this article for publication in your newsletter or on your website. Permission is granted to reprint for free with resource box and byline intact. Please send me a copy of your publication if you choose to include my article.The Power of Small Business Branding Through Private LabelingYour Label Says A Lot About Your BusinessA brand is a powerful tool in your hands, a visual image that encapsulates a perceived value associated with your company, product or service by customers and potential customers. As competition intensifies, small business owners are realizing the power of branding through private label as part of an ingenious business strategy. Owning your brand is not only an alluring marketing and sales tool, it makes good small business sense. Wholesalers of private label products offer resellers and diverse others the opportunity to build recognition for their own company and product, as well as develop customer loyalty. With a lead on identity and a secure on loyalty, new and repeat sales are sure to follow, given that your product meets consumer expectations. The bottom line is: You will drive your revenues and increase profits through the use of private labels. Once thought of as a value-added, low cost substitute for higher priced name brands, private label brands were referred to as store or generic brands; remember the no name brand! Interestingly, the private label perception is blossoming in today’s marketplace as the upscale alternative to national brands. As burnt cream evolved into French crème brûlée, consumers now consider private label brands as an affordable extravagance. Associated with distinctive, premium quality products and services, private labels are now positioning as your own proprietary brand or personalized brand, and rightly so. Private Label Brands Are Packed With BenefitsA private label packs numerous marketing and sales benefits into your product. The basics of any good marketing plan are simple: Increase your customer base, increase the frequency of repeat sales and increase the average expenditure, the question is… how? Designed to display and impress your image and developed around your target market, propriety label may be the answer. Your own brand is what sets you apart from your competitors and builds brand loyalty. Differentiating your product as a unique brand also enables you to compete on non-price factors such as quality. A smart move for small business because typically, they cannot achieve sales volume levels to be a low price favorite. Stocking name brand products does little to entice consumers into your brick and mortar or online store. National brands are widely distributed and can be purchased almost anywhere. A private label will bring customers to your place of business, as your brand is exclusive. An additional benefit is that of product awareness, every time a customer opens your private label product sitting on the counter top the customer is reminded where the product was purchased. Small businesses do not have abundant resources to spend on large marketing and advertising campaigns like their national competitors. Your proprietary label, imprinted on an appealing package, is an excellent advertising item and channel. You gain exposure and get the word out about your business and product, requiring little effort outside your input in the label and package design. Using a private label is a cost effective method to market your small business. Of course, customers will not rush back to your store and beat down the door for a label. Establishing the brand with a high quality product is essential for repeat sales. Generate trust in your brand by selecting a respected wholesaler who knows the product and the business well. To promote consumer purchasing the reseller must also perfect the private label to meet the desires and expectations of the target market. Black Tea or Decadently Rich Chocolate Chai? You DecideLet’s take a look at a fast growing, competitive segment of the beverage industry, tea, to see how the benefits of private label are put into practice. Once trailing far behind the specialty coffee market, tea is now surging in the popularity and so are the sellers. The trend is driven by consumer lifestyle shifts toward good health, luxury and pleasure. Specialty tea is forecasted to become a major portion of the tea industry. Demand is stimulated by the new products available as consumers seek extraordinary and exotic tea flavors.It is essential reseller’s offer a quality product from a knowledgeable wholesaler supplier, as product choice can make or break a business. Working in partnership, the private label wholesaler and reseller will bring together knowledge, experience and creativity in the design of a captivating label and appealing package. With endless choices, from loose leaf to tins, the finally product is presented to exceed the reseller and final consumers expectations.An up and coming leader in the national spa market, exhale spa promotes a whole body rejuvenating selection of services based upon the wisdom of traditional healing and movement therapies. To enhance the relaxing ambience of the spa, exhale serves their own signature tea blends, formulated and packaged by Lapis Teahouse, a provider of premium private label tea. Resellers turn to Lapis Teahouse (http://www.lapisteahouse.com) and other select wholesalers that offer both private label and custom blending services for a competitive advantage. Private label companies build trust in a brand by selecting and custom blending extraordinary teas for flavor, aroma, and quality. Exciting new products are designed to fit the customer’s unique needs and compliment their business image.Private label producers serve a diverse customer base, and each benefit by selling a private label brand. From a nutrition center prescribing the health benefits of organic herbal tea, to an elegant teahouse serving a taste of luxury for tea connoisseurs, a brand can be developed to reflect and project your image. You don’t have to be a reseller to capitalize on the rewards of a unique identity. The private label extends into the service industry to enhance professional services and company ambience. Small business branding through private labeling conclusively builds company and product recognition. Positioning your unique product through private label, aimed at your target market, results in an effective, low cost-effort marketing strategy. It is the solution to getting customers into your store and back again and again… If your company is competing in the beverage or any other industry by using other brands, consider the benefits of your own proprietary brand. No matter how you label it, small business branding through a private label wholesaler is powerful marketing!
Please consider this article for publication in your newsletter or on your website. Permission is granted to reprint for free with resource box and byline intact. Please send me a copy of your publication if you choose to include my article.The Power of Small Business Branding Through Private LabelingYour Label Says A Lot About Your BusinessA brand is a powerful tool in your hands, a visual image that encapsulates a perceived value associated with your company, product or service by customers and potential customers. As competition intensifies, small business owners are realizing the power of branding through private label as part of an ingenious business strategy. Owning your brand is not only an alluring marketing and sales tool, it makes good small business sense. Wholesalers of private label products offer resellers and diverse others the opportunity to build recognition for their own company and product, as well as develop customer loyalty. With a lead on identity and a secure on loyalty, new and repeat sales are sure to follow, given that your product meets consumer expectations. The bottom line is: You will drive your revenues and increase profits through the use of private labels. Once thought of as a value-added, low cost substitute for higher priced name brands, private label brands were referred to as store or generic brands; remember the no name brand! Interestingly, the private label perception is blossoming in today’s marketplace as the upscale alternative to national brands. As burnt cream evolved into French crème brûlée, consumers now consider private label brands as an affordable extravagance. Associated with distinctive, premium quality products and services, private labels are now positioning as your own proprietary brand or personalized brand, and rightly so. Private Label Brands Are Packed With BenefitsA private label packs numerous marketing and sales benefits into your product. The basics of any good marketing plan are simple: Increase your customer base, increase the frequency of repeat sales and increase the average expenditure, the question is… how? Designed to display and impress your image and developed around your target market, propriety label may be the answer. Your own brand is what sets you apart from your competitors and builds brand loyalty. Differentiating your product as a unique brand also enables you to compete on non-price factors such as quality. A smart move for small business because typically, they cannot achieve sales volume levels to be a low price favorite. Stocking name brand products does little to entice consumers into your brick and mortar or online store. National brands are widely distributed and can be purchased almost anywhere. A private label will bring customers to your place of business, as your brand is exclusive. An additional benefit is that of product awareness, every time a customer opens your private label product sitting on the counter top the customer is reminded where the product was purchased. Small businesses do not have abundant resources to spend on large marketing and advertising campaigns like their national competitors. Your proprietary label, imprinted on an appealing package, is an excellent advertising item and channel. You gain exposure and get the word out about your business and product, requiring little effort outside your input in the label and package design. Using a private label is a cost effective method to market your small business. Of course, customers will not rush back to your store and beat down the door for a label. Establishing the brand with a high quality product is essential for repeat sales. Generate trust in your brand by selecting a respected wholesaler who knows the product and the business well. To promote consumer purchasing the reseller must also perfect the private label to meet the desires and expectations of the target market. Black Tea or Decadently Rich Chocolate Chai? You DecideLet’s take a look at a fast growing, competitive segment of the beverage industry, tea, to see how the benefits of private label are put into practice. Once trailing far behind the specialty coffee market, tea is now surging in the popularity and so are the sellers. The trend is driven by consumer lifestyle shifts toward good health, luxury and pleasure. Specialty tea is forecasted to become a major portion of the tea industry. Demand is stimulated by the new products available as consumers seek extraordinary and exotic tea flavors.It is essential reseller’s offer a quality product from a knowledgeable wholesaler supplier, as product choice can make or break a business. Working in partnership, the private label wholesaler and reseller will bring together knowledge, experience and creativity in the design of a captivating label and appealing package. With endless choices, from loose leaf to tins, the finally product is presented to exceed the reseller and final consumers expectations.An up and coming leader in the national spa market, exhale spa promotes a whole body rejuvenating selection of services based upon the wisdom of traditional healing and movement therapies. To enhance the relaxing ambience of the spa, exhale serves their own signature tea blends, formulated and packaged by Lapis Teahouse, a provider of premium private label tea. Resellers turn to Lapis Teahouse (http://www.lapisteahouse.com) and other select wholesalers that offer both private label and custom blending services for a competitive advantage. Private label companies build trust in a brand by selecting and custom blending extraordinary teas for flavor, aroma, and quality. Exciting new products are designed to fit the customer’s unique needs and compliment their business image.Private label producers serve a diverse customer base, and each benefit by selling a private label brand. From a nutrition center prescribing the health benefits of organic herbal tea, to an elegant teahouse serving a taste of luxury for tea connoisseurs, a brand can be developed to reflect and project your image. You don’t have to be a reseller to capitalize on the rewards of a unique identity. The private label extends into the service industry to enhance professional services and company ambience. Small business branding through private labeling conclusively builds company and product recognition. Positioning your unique product through private label, aimed at your target market, results in an effective, low cost-effort marketing strategy. It is the solution to getting customers into your store and back again and again… If your company is competing in the beverage or any other industry by using other brands, consider the benefits of your own proprietary brand. No matter how you label it, small business branding through a private label wholesaler is powerful marketing!
Early-Warning-Systems for small businesses
by: Stephan Szugat
Most of you would say, that this might not be the most important problem small businesses have to solve during their business operation. Well, that might be true, but on the other hand, if your business has an early-warning-system, than it could assist you in operating your business and keeps you focused on solving the bottlenecks you are actually facing. But first of all, in case of Early-Warning-Systems it is necessary to define what a small business is. A small business is usually a business operated by 1 or a few people, but could also be a company with as much as 500 employees. This article concentrates on small businesses with 1 to 50 employees. As this is the definition of small business, than we have to define what an Early-Warning-System should look like. While running a small business, the people involved usually have not the time dealing with Early-Warning-Systems a lot. Because of the lack of time, there has to be a lean solution, which takes care of the following things: easy to use solution not time consuming showing recommendations for possible actions/measures on early warnings giving priorities which bottlenecks have to be solved first having a short reporting cycle a reasonable price, every small business could afford. Lets go to the list one by one. Easy to use solution What does that mean? On my opinion, easy usage is, when something is easy and fast to understand. Something I do not need to read a huge book with hundreds of pages or where I have to attend a training, which keeps you occupied by several hours or days, just to know the basic features. Having a system with huge databases and many features and reporting alternatives, is not only time consuming, it is also annoying, because you ever feel you need to perform a lot more reports. And you always feel that you may missed something. Furthermore a good Early-Warning-System solution should work with only few input. But that’s another point. Not time consuming When you have to input a lot of data that is one possible time consuming task. On the other hand, you do not know, if a huge database will make your Early-Warning-System better. So it is better to focus on a few important data, than having a huge database, which you probably never use. When concentrating on important data, you are not able to use every data from your business operation directly. Some data have to be calculated to business ratios, which are a better basis for analysis. But this brings to mind to select the right business ratios. There are so many to find. Well, there are a few which could be used for all kinds of businesses, such as Customer Contacts Complaints Orders in Process Customer Loyalty Usage of capacity Order Processing Time to show just a few. Would be an analysis, which uses only 30 business ratios or business numbers a time consuming solution? I guess you say no. But, what would be if you have to fill in these numbers every day? Well, that’s not necessary. One time a week should be enough. However, even if 30 or 60 values for business ratios per week does not sound much work, but there is a little more work to do upfront, before you could use these values for analysis. You have to find the values in your company, you have to calculate the business ratio values and so on. This I believe sounds to be a lot more work as you thought. When you install the right procedure to get the necessary data for analysis, you may have an addition big one-time work. It’s all in the procedure you choose. Make it as easy as possible and it won’t be a time consuming task. Recommend actions/measures Early-Warnings are signs, which a system should generate, when a point is reached you said it should inform you that a situation is going to be worse. There are many systems out there providing early-warnings, but the question is always, on basis this warning has been calculated and to what will it lead you. To understand an early warning signal it should be as easy to understand as a traffic light signal. Green says that everything is all right, yellow shows you that caution has to be taken and red should bring the alarm clock ringing at you. Well, providing recommendations for actions/measures is not a very important feature, but if you are not familiar with business operations or just starting a business it is of help to get recommendations for actions/measures to keep your business running. But even if you have lot of experience runninga business, it is sometimes very helpful to get new ideas on how to act. Actions/Measures could only be a recommendation here, because industry sectors are different, and it wouldn't be possible to cover all types of businesses. Showing priorities to solve bottlenecks Remember the paragraph above about early warning signals, they could be used to find priorities to solve bottlenecks in business operation. First of all the warning signals must follow some rules. That means that the business ratios supplying the signal have to be in a consecutive timely manner to each other. For example, when you have 5 ratios depending on each other in a consecutive manner, than you have automatically a priority to follow when actions are needed. In case your ratio number 3 has a yellow signal and number 4 a red signal, than you know that you first have to solve the problem ratio 4 is showing, because you got the red flag and it has influence to ratio 5, which was green. This small example shows how important it is to use the right business ratios and how important it is to concentrate on the traffic light systematic when taking actions. Short Reporting Cycle A short reporting cycle may be a month for some business operators, but when waiting for Early-Warning-System analysis for about 4 weeks, you are only able to take action on erroneous trends once per month. And in some cases this could be already to late. Really short is a reporting cycle, which uses a week as its basic period. Why using reporting cycles of one week? Just because you can see erroneous trends earlier and being able to take actions, while others are still waiting their reports to come. On a weekly reporting cycle you could act at least 3 to 4 weeks earlier as on monthly reporting cycles. I don’t think you are driving your car blind for more than a small part of a second. Just imagine what happens, when driving your car blind for a month, just like the usual reporting cycle for business reporting? You are right, just a few seconds after start driving you have the first accident. Even if you are an airline pilot and having an autopilot system, you steadily have to control the system, to be sure that you are heading in the right direction. Reasonable Price Reasonable is a price, which nearly all small businesses could afford. Even if the price is paid in instalments or as rent for the licence to use a system. An Early-Warning-System, as the lean version described here, doesn't has to be very expensive. However, the decision is yours, if you like to pay more or less on an Early-Warning-System, but you should carefully check the features and benefits a solution offers. Conclusion Early-Warning-Systems for small businesses is a very important and often overlooked issue, which could assist to establish a more focused business operation, but only when the Early-Warning-System shows actual bottlenecks and is able to provide priorities for actions/measures. However, most small business owners or operators are not aware of the problems Early-Warning-Systems could bring them before there eyes. Furthermore, the possibility of finding new target markets, new solutions or ideas to improve existing products, is just a benefit an Early-Warning-Systems solution may offer as well. If you think the described solution is not an Early-Warning-System, because an Early-Warning-System has to be something where you have to handle lots of data and documents, well, that might be another definition for it, but starting with a small solution is always better than doing nothing. There is no reason to use a big system to provide early-warnings, and for small businesses big systems don’t make sense at all.
Most of you would say, that this might not be the most important problem small businesses have to solve during their business operation. Well, that might be true, but on the other hand, if your business has an early-warning-system, than it could assist you in operating your business and keeps you focused on solving the bottlenecks you are actually facing. But first of all, in case of Early-Warning-Systems it is necessary to define what a small business is. A small business is usually a business operated by 1 or a few people, but could also be a company with as much as 500 employees. This article concentrates on small businesses with 1 to 50 employees. As this is the definition of small business, than we have to define what an Early-Warning-System should look like. While running a small business, the people involved usually have not the time dealing with Early-Warning-Systems a lot. Because of the lack of time, there has to be a lean solution, which takes care of the following things: easy to use solution not time consuming showing recommendations for possible actions/measures on early warnings giving priorities which bottlenecks have to be solved first having a short reporting cycle a reasonable price, every small business could afford. Lets go to the list one by one. Easy to use solution What does that mean? On my opinion, easy usage is, when something is easy and fast to understand. Something I do not need to read a huge book with hundreds of pages or where I have to attend a training, which keeps you occupied by several hours or days, just to know the basic features. Having a system with huge databases and many features and reporting alternatives, is not only time consuming, it is also annoying, because you ever feel you need to perform a lot more reports. And you always feel that you may missed something. Furthermore a good Early-Warning-System solution should work with only few input. But that’s another point. Not time consuming When you have to input a lot of data that is one possible time consuming task. On the other hand, you do not know, if a huge database will make your Early-Warning-System better. So it is better to focus on a few important data, than having a huge database, which you probably never use. When concentrating on important data, you are not able to use every data from your business operation directly. Some data have to be calculated to business ratios, which are a better basis for analysis. But this brings to mind to select the right business ratios. There are so many to find. Well, there are a few which could be used for all kinds of businesses, such as Customer Contacts Complaints Orders in Process Customer Loyalty Usage of capacity Order Processing Time to show just a few. Would be an analysis, which uses only 30 business ratios or business numbers a time consuming solution? I guess you say no. But, what would be if you have to fill in these numbers every day? Well, that’s not necessary. One time a week should be enough. However, even if 30 or 60 values for business ratios per week does not sound much work, but there is a little more work to do upfront, before you could use these values for analysis. You have to find the values in your company, you have to calculate the business ratio values and so on. This I believe sounds to be a lot more work as you thought. When you install the right procedure to get the necessary data for analysis, you may have an addition big one-time work. It’s all in the procedure you choose. Make it as easy as possible and it won’t be a time consuming task. Recommend actions/measures Early-Warnings are signs, which a system should generate, when a point is reached you said it should inform you that a situation is going to be worse. There are many systems out there providing early-warnings, but the question is always, on basis this warning has been calculated and to what will it lead you. To understand an early warning signal it should be as easy to understand as a traffic light signal. Green says that everything is all right, yellow shows you that caution has to be taken and red should bring the alarm clock ringing at you. Well, providing recommendations for actions/measures is not a very important feature, but if you are not familiar with business operations or just starting a business it is of help to get recommendations for actions/measures to keep your business running. But even if you have lot of experience runninga business, it is sometimes very helpful to get new ideas on how to act. Actions/Measures could only be a recommendation here, because industry sectors are different, and it wouldn't be possible to cover all types of businesses. Showing priorities to solve bottlenecks Remember the paragraph above about early warning signals, they could be used to find priorities to solve bottlenecks in business operation. First of all the warning signals must follow some rules. That means that the business ratios supplying the signal have to be in a consecutive timely manner to each other. For example, when you have 5 ratios depending on each other in a consecutive manner, than you have automatically a priority to follow when actions are needed. In case your ratio number 3 has a yellow signal and number 4 a red signal, than you know that you first have to solve the problem ratio 4 is showing, because you got the red flag and it has influence to ratio 5, which was green. This small example shows how important it is to use the right business ratios and how important it is to concentrate on the traffic light systematic when taking actions. Short Reporting Cycle A short reporting cycle may be a month for some business operators, but when waiting for Early-Warning-System analysis for about 4 weeks, you are only able to take action on erroneous trends once per month. And in some cases this could be already to late. Really short is a reporting cycle, which uses a week as its basic period. Why using reporting cycles of one week? Just because you can see erroneous trends earlier and being able to take actions, while others are still waiting their reports to come. On a weekly reporting cycle you could act at least 3 to 4 weeks earlier as on monthly reporting cycles. I don’t think you are driving your car blind for more than a small part of a second. Just imagine what happens, when driving your car blind for a month, just like the usual reporting cycle for business reporting? You are right, just a few seconds after start driving you have the first accident. Even if you are an airline pilot and having an autopilot system, you steadily have to control the system, to be sure that you are heading in the right direction. Reasonable Price Reasonable is a price, which nearly all small businesses could afford. Even if the price is paid in instalments or as rent for the licence to use a system. An Early-Warning-System, as the lean version described here, doesn't has to be very expensive. However, the decision is yours, if you like to pay more or less on an Early-Warning-System, but you should carefully check the features and benefits a solution offers. Conclusion Early-Warning-Systems for small businesses is a very important and often overlooked issue, which could assist to establish a more focused business operation, but only when the Early-Warning-System shows actual bottlenecks and is able to provide priorities for actions/measures. However, most small business owners or operators are not aware of the problems Early-Warning-Systems could bring them before there eyes. Furthermore, the possibility of finding new target markets, new solutions or ideas to improve existing products, is just a benefit an Early-Warning-Systems solution may offer as well. If you think the described solution is not an Early-Warning-System, because an Early-Warning-System has to be something where you have to handle lots of data and documents, well, that might be another definition for it, but starting with a small solution is always better than doing nothing. There is no reason to use a big system to provide early-warnings, and for small businesses big systems don’t make sense at all.
STARTING A BUSINESS? WHAT NEW (AND EXISTING) BUSINESS OWNERS SHOULD KNOW
by: Dianne Goodman, CPA
Starting a business can be overwhelming enough trying to get up and running but when you think about all the tax requirements, your cup may runneth over. Here is what you must know in order to start your own business on the right foot and avoid paying penalties and interest which can cost more than paying an accountant to do things right the first time.WHAT FORM OF BUSINESS SHOULD YOU SET UP WHEN STARTING YOUR BUSINESS?There are several different options including a sole proprietorship, partnership, corporation, S corporation or limited liability company. In general a sole proprietorship works fine if you are very small, not too profitable and aren’t concerned about legal liability issues. A partnership is like being married to the other partners. If you aren’t that cozy with them, you may want to set up another type of entity. Corporations are best suited for business owners who want personal legal protection and have profit available beyond what they will need for their personal use. See http://www.dgoodmancpa.com/smallbusinessretirementplan.htm for an example of what you can do with that available profit tax deferred until retirement. S Corporations are best when you are operating at a loss and want business owner legal protection. Limited liability companies will protect the business owner from personal legal liability and, if structured properly, can be a partnership, corporation or owner for federal income tax purposes.DO YOU NEED AN EMPLOYER IDENTIFICATION NUMBER (EIN) WHEN YOU START YOUR OWN BUSINESS?You need an employer identification number if you have employees, have a qualified retirement plan, operate as a corporation or a partnership, or need to file employment or excise tax returns. You do not need an employer identification number if you are a sole proprietor and don’t meet any of the requirements above.WHAT METHOD CAN YOU USE TO ACCOUNT FOR YOUR INCOME AND EXPENSES WHEN YOU START YOUR SMALL BUSINESS?The two most common methods are cash and accrual. The cash method in general allows you to report income and expenses in the tax year you receive it. The accrual method in general allows you to report income and expenses in the tax year you earn or incur it even if you haven’t received payment or paid it yet.WHAT KINDS OF FEDERAL TAXES WILL YOU OWE WHEN STARTING A BUSINESS?All businesses must file a return. The form used depends on what form of business you set up when starting your business. The federal income tax is a pay-as-you-go tax. In general you must pay the tax as you earn or receive income during the year to avoid penalties and interest if your tax liability for the year exceeds $1,000 including self employment tax for sole proprietors, partners and S corporation shareholders. Corporations should make estimated quarterly payments if they expect to owe $500 for the year. Estimated tax payments are due quarterly. Penalties and interest can be hefty so you should make sure you comply in order to avoid wasting money on IRS penalties.WHAT TAXES ARE DUE IF YOU HAVE EMPLOYEES IN YOUR SMALL BUSINESS?Your small business must pay social security and Medicare taxes, federal income tax withholding, federal unemployment tax along with your state and local income taxes. The associated tax returns for reporting these taxes are in general filed quarterly. Your business is entrusted to pay these taxes on behalf of your employees and not only do you have penalties and interest that you will pay for not filing them timely but can also be committing a crime due to the fiduciary responsibility. You need to be sure you know what you are doing here as the consequences could be costly.WHAT RECORDS SHOULD YOU KEEP WHEN YOU START YOUR BUSINESS?Except in a few cases, the law does not require any specific kinds of records. The most important thing to ask yourself is can you go back to all of the original receipts from the number on your return. If you were to be asked by an IRS agent to provide all the details of a certain number on your return, and you can not do that, you will be at his whim on whether he will allow that deduction. An efficient accounting system with a solid audit trail which has been reconciled is the safest way to be sure you have done this.These are just some questions you may have regarding starting your new business. If you have more, e-mail me at dianne@dgoodmancpa.com and I will help you muddle through the tax and business issues you may have. After all, those of us that have our own business know it’s the only way to go but getting up and running can be a bit of a challenge.This article was intended to provide general information about starting a business. It does not contain all the rules and exceptions that may apply to your situation. If you have further questions regarding starting a small business, I can be reached at www.dgoodmancpa.com.Coming Soon - Year End Tax Planning and PreparationCONTACT INFORMATION:Dianne Goodman, CPAComprehensive Small Business Solutions, PC505 323-23071 866-531-3035 toll freehttp://www.dgoodmancpa.comYou have permission to reprint what you just read. Use it in your ezine, at your website or in your newsletter. The only requirement is to include the following footer...Starting a Business? What New (and existing) Business Owners Should Know by Dianne Goodman, visit http://www.dgoodmancpa.com for more content like this.
Starting a business can be overwhelming enough trying to get up and running but when you think about all the tax requirements, your cup may runneth over. Here is what you must know in order to start your own business on the right foot and avoid paying penalties and interest which can cost more than paying an accountant to do things right the first time.WHAT FORM OF BUSINESS SHOULD YOU SET UP WHEN STARTING YOUR BUSINESS?There are several different options including a sole proprietorship, partnership, corporation, S corporation or limited liability company. In general a sole proprietorship works fine if you are very small, not too profitable and aren’t concerned about legal liability issues. A partnership is like being married to the other partners. If you aren’t that cozy with them, you may want to set up another type of entity. Corporations are best suited for business owners who want personal legal protection and have profit available beyond what they will need for their personal use. See http://www.dgoodmancpa.com/smallbusinessretirementplan.htm for an example of what you can do with that available profit tax deferred until retirement. S Corporations are best when you are operating at a loss and want business owner legal protection. Limited liability companies will protect the business owner from personal legal liability and, if structured properly, can be a partnership, corporation or owner for federal income tax purposes.DO YOU NEED AN EMPLOYER IDENTIFICATION NUMBER (EIN) WHEN YOU START YOUR OWN BUSINESS?You need an employer identification number if you have employees, have a qualified retirement plan, operate as a corporation or a partnership, or need to file employment or excise tax returns. You do not need an employer identification number if you are a sole proprietor and don’t meet any of the requirements above.WHAT METHOD CAN YOU USE TO ACCOUNT FOR YOUR INCOME AND EXPENSES WHEN YOU START YOUR SMALL BUSINESS?The two most common methods are cash and accrual. The cash method in general allows you to report income and expenses in the tax year you receive it. The accrual method in general allows you to report income and expenses in the tax year you earn or incur it even if you haven’t received payment or paid it yet.WHAT KINDS OF FEDERAL TAXES WILL YOU OWE WHEN STARTING A BUSINESS?All businesses must file a return. The form used depends on what form of business you set up when starting your business. The federal income tax is a pay-as-you-go tax. In general you must pay the tax as you earn or receive income during the year to avoid penalties and interest if your tax liability for the year exceeds $1,000 including self employment tax for sole proprietors, partners and S corporation shareholders. Corporations should make estimated quarterly payments if they expect to owe $500 for the year. Estimated tax payments are due quarterly. Penalties and interest can be hefty so you should make sure you comply in order to avoid wasting money on IRS penalties.WHAT TAXES ARE DUE IF YOU HAVE EMPLOYEES IN YOUR SMALL BUSINESS?Your small business must pay social security and Medicare taxes, federal income tax withholding, federal unemployment tax along with your state and local income taxes. The associated tax returns for reporting these taxes are in general filed quarterly. Your business is entrusted to pay these taxes on behalf of your employees and not only do you have penalties and interest that you will pay for not filing them timely but can also be committing a crime due to the fiduciary responsibility. You need to be sure you know what you are doing here as the consequences could be costly.WHAT RECORDS SHOULD YOU KEEP WHEN YOU START YOUR BUSINESS?Except in a few cases, the law does not require any specific kinds of records. The most important thing to ask yourself is can you go back to all of the original receipts from the number on your return. If you were to be asked by an IRS agent to provide all the details of a certain number on your return, and you can not do that, you will be at his whim on whether he will allow that deduction. An efficient accounting system with a solid audit trail which has been reconciled is the safest way to be sure you have done this.These are just some questions you may have regarding starting your new business. If you have more, e-mail me at dianne@dgoodmancpa.com and I will help you muddle through the tax and business issues you may have. After all, those of us that have our own business know it’s the only way to go but getting up and running can be a bit of a challenge.This article was intended to provide general information about starting a business. It does not contain all the rules and exceptions that may apply to your situation. If you have further questions regarding starting a small business, I can be reached at www.dgoodmancpa.com.Coming Soon - Year End Tax Planning and PreparationCONTACT INFORMATION:Dianne Goodman, CPAComprehensive Small Business Solutions, PC505 323-23071 866-531-3035 toll freehttp://www.dgoodmancpa.comYou have permission to reprint what you just read. Use it in your ezine, at your website or in your newsletter. The only requirement is to include the following footer...Starting a Business? What New (and existing) Business Owners Should Know by Dianne Goodman, visit http://www.dgoodmancpa.com for more content like this.
SAFELY PROTECT YOUR HOME BASED DREAM OF RETIRING WEALTHY!
by: Dr. Scott Brown, Ph.D.
The SIMPLE retirement account is awesome if you own your own business. Any family business applies such as a home based or “brick and mortar” real estate rental and investment business, car-wash, gas station, restaurant, etcetera, can sponsor the SIMPLE IRA. Like the SEP-IRA, the SIMPLE IRA is company-sponsored. As a small business owner, for 2003 for instance you could have matched each employee's pay up to 3 percent or $8,000, whichever is less. That adds up to a lot of money when it is a profitable business and family members are employees. SIMPLE IRA contributions are fully deductible when you put the money in the account but you will have to pay taxes on any profits you make on the stock when you retire. In addition to a SIMPLE IRA accounts, individuals and home based small businesses have an additional option to sock away money toward future retirement educational needs through educational IRAs. Small businesses, which cannot afford to sponsor a 401(k) or 403(b), can also offer employees basic retirement plans established for the benefit of their employees. Sole proprietors also now also can open individual 401(k) plans. Examine the options and pick the one that maximizes your long-range savings goal. And don't wait. Take advantage of compound earnings and start socking away cash now for tomorrow.
The SIMPLE retirement account is awesome if you own your own business. Any family business applies such as a home based or “brick and mortar” real estate rental and investment business, car-wash, gas station, restaurant, etcetera, can sponsor the SIMPLE IRA. Like the SEP-IRA, the SIMPLE IRA is company-sponsored. As a small business owner, for 2003 for instance you could have matched each employee's pay up to 3 percent or $8,000, whichever is less. That adds up to a lot of money when it is a profitable business and family members are employees. SIMPLE IRA contributions are fully deductible when you put the money in the account but you will have to pay taxes on any profits you make on the stock when you retire. In addition to a SIMPLE IRA accounts, individuals and home based small businesses have an additional option to sock away money toward future retirement educational needs through educational IRAs. Small businesses, which cannot afford to sponsor a 401(k) or 403(b), can also offer employees basic retirement plans established for the benefit of their employees. Sole proprietors also now also can open individual 401(k) plans. Examine the options and pick the one that maximizes your long-range savings goal. And don't wait. Take advantage of compound earnings and start socking away cash now for tomorrow.
Health Savings Accounts – Great Option for Small Businesses and Individuals!
by: Dianne Goodman
Health Savings Accounts – HSA’s – The Who, What, Where, When and Why on HSA’s.What is an HSA? Health Savings Accounts - HSA's are accounts owned by the individual that allow money to be deposited into a tax-deferred account to pay for current and future medical expenses. They are similar to an MSA-Medical Savings Account, which was the predecessor of the HSA. This money can be deposited by you and/or your employer. You can think of it as an IRA/Flex account combination. An HSA must be tied to a high-deductible health insurance plan (HDHP) which is designed to fit the requirements of an HSA. There are limitations on the amount that can be contributed each year.Who will it benefit?HSA's can be beneficial to individuals, small businesses or any size business that is interested in pursuing a high deductible insurance and lowering their healthcare costs. This can be extremely beneficial if you only use your insurance for accidents or unexpected medical circumstances. It is also beneficial if you are looking for lower rates on your insurance premiums but would like to have an account available where you can accumulate funds to use for your medical expenses while meeting your deductible and co-insurance. It can also be used for expenses not covered by the insurance. There is no deadline on withdrawal of the funds and they can be withdrawn for other than medical expenses penalty free after an individual is eligible for Medicare.When will they be available?They are available now. They are hard to find. Most companies that I contacted such as Bank of America and ADP were not familiar with Health Savings Accounts or did not offer this as of yet. They may be offering these accounts in the future. Not all agents are interested in selling the product since the high-deductible insurance premiums do not provide for a high-profit margin. However, I did find several insurance companies that offer these insurance plans. Fortis Insurance was instrumental in getting the HSA legislation passed. Fortis invested a tremendous amount into the HSA program and feels that this product is the wave of the future. Also, World Insurance, IAC, and American Medical Security have designed high deductible plans. All these companies feel that HSA's are going to be in great demand from the public. Blue Cross/Blue Shield is planning on having a plan available in January 2005. After doing some internet surfing I found an expert on HSA's at http://www.americanhealthvalue.com/ that provided a wealth of information about HSA's and even has links to insurance companies that offer the high-deductible medical insurance by state.Why have an HSA?Small Businesses - It allows a company to provide insurance without having to pay high premiums. The employer can also contribute to the account of the individual for the difference in the lower premium. There are certain limitations on employer contributions, but they are done completely tax free to the employee and tax deductible to the business. Individuals - Contributions to the HSA are an above-the-line deduction on the 1040 with certain limitations. Individuals 55 and older can make "catch up" contributions - $500 in 2004. Deductions from the account for qualified medical expenses are tax free and include over-the-counter medications and apply to the person covered, their spouse and dependents even if the spouse or dependent are not covered by the insurance plan. HSA's can be used to pay for COBRA continuation coverage, health plan coverage while on unemployment, qualified long-term care insurance and some expenses for individuals enrolled in Medicare. HSA's provide a vehicle to allow savings for future medical expenses and while in the account are invested to allow the account to grow the investment earnings. HSA's are owned by the individual and controlled by the individual allowing them to decide on contributions, withdrawals and investment options. HSA's remain with the individual regardless of employment, age, where they live, marital status or future medical coverage. There are no "use it or loose it rules" as there are with FLEX accounts. Where can I get an HSA account?American Health Value - http://www.americanhealthvalue.com/ is one company which offers the administration of this account for a nominal fee. At this web site you can learn just about everything there is to learn about HSA's, about the mechanics of setting up an account, how the account works, how to withdraw and contribute funds, what expenses are eligible and what types of options can be set up. You can click on Insurance Agents by State to find a local agent in your area that sells the high-deductible medical insurance plans that are designed to work with the HSA account. In New Mexico I contacted Judy Anderson, an independent insurance broker in Albuquerque. She has insurance plans that fit the HSA requirements. She can be reached at 1-800-627-2433 or jeander@aol.com for further information on New Mexico insurance plans with an HSA. She advised me on the rating of the insurance companies she would quote which were all "A" rated. It is important to find an insurance company for any insurance you buy that has a good rating since if they go out of business you will need to find another insurance company and if you have too many claims you may have difficulty finding one that will insure you. Happy Insuring!Coming Soon - Retirement Planning for Small Businesses About the author:About the Author Dianne Goodman, CPA –Specializes in servicing Small Businesses and Individuals. Visit http://www.dgoodmancpa.com/for relevant and current information on a variety of financial and tax issues focusing on small and very small businesses and individuals or call at 1-866-531-3035. CONTACT INFORMATION: Dianne Goodman, CPA Comprehensive Small Business Solutions, PC 505 323-2307 1 866-531-3035 toll free http://www.dgoodmancpa.com/You have permission to reprint what you just read. Use it in your ezine, at your website or in your newsletter. The only requirements are send an e-mail to dianne@dgoodmancpa.com and include the following footer... Health Savings Accounts – Great Option for Small Businesses and Individuals! By Dianne Goodman, visit http://www.dgoodmancpa.com/for more content like this.
Health Savings Accounts – HSA’s – The Who, What, Where, When and Why on HSA’s.What is an HSA? Health Savings Accounts - HSA's are accounts owned by the individual that allow money to be deposited into a tax-deferred account to pay for current and future medical expenses. They are similar to an MSA-Medical Savings Account, which was the predecessor of the HSA. This money can be deposited by you and/or your employer. You can think of it as an IRA/Flex account combination. An HSA must be tied to a high-deductible health insurance plan (HDHP) which is designed to fit the requirements of an HSA. There are limitations on the amount that can be contributed each year.Who will it benefit?HSA's can be beneficial to individuals, small businesses or any size business that is interested in pursuing a high deductible insurance and lowering their healthcare costs. This can be extremely beneficial if you only use your insurance for accidents or unexpected medical circumstances. It is also beneficial if you are looking for lower rates on your insurance premiums but would like to have an account available where you can accumulate funds to use for your medical expenses while meeting your deductible and co-insurance. It can also be used for expenses not covered by the insurance. There is no deadline on withdrawal of the funds and they can be withdrawn for other than medical expenses penalty free after an individual is eligible for Medicare.When will they be available?They are available now. They are hard to find. Most companies that I contacted such as Bank of America and ADP were not familiar with Health Savings Accounts or did not offer this as of yet. They may be offering these accounts in the future. Not all agents are interested in selling the product since the high-deductible insurance premiums do not provide for a high-profit margin. However, I did find several insurance companies that offer these insurance plans. Fortis Insurance was instrumental in getting the HSA legislation passed. Fortis invested a tremendous amount into the HSA program and feels that this product is the wave of the future. Also, World Insurance, IAC, and American Medical Security have designed high deductible plans. All these companies feel that HSA's are going to be in great demand from the public. Blue Cross/Blue Shield is planning on having a plan available in January 2005. After doing some internet surfing I found an expert on HSA's at http://www.americanhealthvalue.com/ that provided a wealth of information about HSA's and even has links to insurance companies that offer the high-deductible medical insurance by state.Why have an HSA?Small Businesses - It allows a company to provide insurance without having to pay high premiums. The employer can also contribute to the account of the individual for the difference in the lower premium. There are certain limitations on employer contributions, but they are done completely tax free to the employee and tax deductible to the business. Individuals - Contributions to the HSA are an above-the-line deduction on the 1040 with certain limitations. Individuals 55 and older can make "catch up" contributions - $500 in 2004. Deductions from the account for qualified medical expenses are tax free and include over-the-counter medications and apply to the person covered, their spouse and dependents even if the spouse or dependent are not covered by the insurance plan. HSA's can be used to pay for COBRA continuation coverage, health plan coverage while on unemployment, qualified long-term care insurance and some expenses for individuals enrolled in Medicare. HSA's provide a vehicle to allow savings for future medical expenses and while in the account are invested to allow the account to grow the investment earnings. HSA's are owned by the individual and controlled by the individual allowing them to decide on contributions, withdrawals and investment options. HSA's remain with the individual regardless of employment, age, where they live, marital status or future medical coverage. There are no "use it or loose it rules" as there are with FLEX accounts. Where can I get an HSA account?American Health Value - http://www.americanhealthvalue.com/ is one company which offers the administration of this account for a nominal fee. At this web site you can learn just about everything there is to learn about HSA's, about the mechanics of setting up an account, how the account works, how to withdraw and contribute funds, what expenses are eligible and what types of options can be set up. You can click on Insurance Agents by State to find a local agent in your area that sells the high-deductible medical insurance plans that are designed to work with the HSA account. In New Mexico I contacted Judy Anderson, an independent insurance broker in Albuquerque. She has insurance plans that fit the HSA requirements. She can be reached at 1-800-627-2433 or jeander@aol.com for further information on New Mexico insurance plans with an HSA. She advised me on the rating of the insurance companies she would quote which were all "A" rated. It is important to find an insurance company for any insurance you buy that has a good rating since if they go out of business you will need to find another insurance company and if you have too many claims you may have difficulty finding one that will insure you. Happy Insuring!Coming Soon - Retirement Planning for Small Businesses About the author:About the Author Dianne Goodman, CPA –Specializes in servicing Small Businesses and Individuals. Visit http://www.dgoodmancpa.com/for relevant and current information on a variety of financial and tax issues focusing on small and very small businesses and individuals or call at 1-866-531-3035. CONTACT INFORMATION: Dianne Goodman, CPA Comprehensive Small Business Solutions, PC 505 323-2307 1 866-531-3035 toll free http://www.dgoodmancpa.com/You have permission to reprint what you just read. Use it in your ezine, at your website or in your newsletter. The only requirements are send an e-mail to dianne@dgoodmancpa.com and include the following footer... Health Savings Accounts – Great Option for Small Businesses and Individuals! By Dianne Goodman, visit http://www.dgoodmancpa.com/for more content like this.
Business Goal Setting
by: Jeff Schuman
How many times have your decided to set a goal for your businessand set it aside because the task seemed too huge or difficultto begin? I have seen this happen over and over so I decided towrite and article on business goal setting. When setting your business goals it is interesting to see thatthe thought process is no different than personal goal setting.You have to clearly define your goal and write it down. Here are7 steps that will help your business achieve th goals you aresetting for it. - Think about the goal you want to set for business - Write the goal down as soon as you visualize it. Writing thegoal on paper for posting on a wall or desk where you may reviewit daily is very important. - As you develop and write your goal, make room for changes andput it on a type paper that can be easily updated as needed.This just means you will need to be ready to revise and changethe written procedures as you move forward with theimplementation of your goal. Change is inevitable a necessity oflife. - Start taking the steps neccessary to implement your goal. - Be sure to write down the date you want the goal to becompleted! Also write down the time and day of the week you willstart working toward the goal! - Begin reflecting on how you are doing working towards youbusiness goal. You can always make adjustments as needed.- Develop an attitude of I will do whatever it takes. Too manybusiness owners set goals and then give up do to laziness orthey just get to busy to follow thru. Business goal setting is a long term process and you are goingto have to work at it to make it happen. It's your business soyou determine the success and failure. Business goal setting isone step that will help you fall into the success category.
How many times have your decided to set a goal for your businessand set it aside because the task seemed too huge or difficultto begin? I have seen this happen over and over so I decided towrite and article on business goal setting. When setting your business goals it is interesting to see thatthe thought process is no different than personal goal setting.You have to clearly define your goal and write it down. Here are7 steps that will help your business achieve th goals you aresetting for it. - Think about the goal you want to set for business - Write the goal down as soon as you visualize it. Writing thegoal on paper for posting on a wall or desk where you may reviewit daily is very important. - As you develop and write your goal, make room for changes andput it on a type paper that can be easily updated as needed.This just means you will need to be ready to revise and changethe written procedures as you move forward with theimplementation of your goal. Change is inevitable a necessity oflife. - Start taking the steps neccessary to implement your goal. - Be sure to write down the date you want the goal to becompleted! Also write down the time and day of the week you willstart working toward the goal! - Begin reflecting on how you are doing working towards youbusiness goal. You can always make adjustments as needed.- Develop an attitude of I will do whatever it takes. Too manybusiness owners set goals and then give up do to laziness orthey just get to busy to follow thru. Business goal setting is a long term process and you are goingto have to work at it to make it happen. It's your business soyou determine the success and failure. Business goal setting isone step that will help you fall into the success category.
Use a Virtual Office as a Profitable Alternative to Paying High Rent
by: Casey Sung
A money saving service that is being used by many professionals today is the virtual office. With so many business professionals working from their homes or on the go, the virtual office has evolved into a popular alternative to leasing a permanent office. It provides a creative solution which benefits the small business owner tremendously.What is a Virtual Office?A virtual office gives small business owners a presence in the business world for a fraction of normal rental costs. It is an alternative to leasing an office space, which can be costly for a new business owner. Virtual office services may also provide a set of online tools to help manage the small business. Although virtual office services differ, below is a list of some of the most common features.1. Physical Business AddressClients are provided with their own physical mailing address where business mail and small packages can be received. Virtual offices are not typically used to receive heavy volumes of mail as in a mail order business, but normal business mail quantities only. Those who operate a business from their home can use the virtual office address instead of their home address, which provides a safe and professional way to receive mail. Mail to a virtual office can be forwarded to the client's home address.2. Local Phone NumberVirtual office services also include a local phone number where a business owner can receive calls and messages. Voice mail and forwarding are usually included so the client can check messages at any time. This works great for someone who works from home or does not wish to tie up a cell phone line if they are continuously on the go.3. Fax CapabilitiesBeing able to receive faxes is important to any business. Faxes are used to conduct business, send reports, take orders and receive memos every day. Using the virtual office fax, the client receives faxes which can be forwarded directly to his/her email.4. Part-time Office AccessSome virtual office services offer part-time access to a desk or work station with Internet capabilities, office equipment and more. This is available for those times when the client needs to organize a presentation before a conference or use the Internet or computer for business purposes.5. Conference Room AccessConference rooms are available for rent with some virtual office setups. The client can hold business meetings or give sales presentations without interruption.6. Web Conference Room AccessWeb conference rooms are available for virtual meetings. Rather than hold a physical meeting, the client can hold virtual business meetings or give virtual sales presentations. Virtual meetings have gained popularity in recent years because they save time and money while providing instant presentation opportunities. Some virtual office services offer this tool as an added service.7. Online virtual toolsOnline tools such as calendar, address book, webmail, document respository, to do's, forums, digital fax and digital voice mail have become common among many large businesses. Some virtual office services offer these tools and others as an added service.Who can Benefit by using a Virtual Office?People of all trades find virtual offices useful. Executives, salespeople, accountants, marketing consultants and online business owners each benefit by using a virtual office for certain tasks. Those who work from home and wish to establish a business presence find that a virtual office meets this need. Corporations also use virtual offices as a means of testing a business location before opening a new branch.When renting an office is not an option, a virtual office can be used by small business owners to meet the daily needs while saving time and money.
A money saving service that is being used by many professionals today is the virtual office. With so many business professionals working from their homes or on the go, the virtual office has evolved into a popular alternative to leasing a permanent office. It provides a creative solution which benefits the small business owner tremendously.What is a Virtual Office?A virtual office gives small business owners a presence in the business world for a fraction of normal rental costs. It is an alternative to leasing an office space, which can be costly for a new business owner. Virtual office services may also provide a set of online tools to help manage the small business. Although virtual office services differ, below is a list of some of the most common features.1. Physical Business AddressClients are provided with their own physical mailing address where business mail and small packages can be received. Virtual offices are not typically used to receive heavy volumes of mail as in a mail order business, but normal business mail quantities only. Those who operate a business from their home can use the virtual office address instead of their home address, which provides a safe and professional way to receive mail. Mail to a virtual office can be forwarded to the client's home address.2. Local Phone NumberVirtual office services also include a local phone number where a business owner can receive calls and messages. Voice mail and forwarding are usually included so the client can check messages at any time. This works great for someone who works from home or does not wish to tie up a cell phone line if they are continuously on the go.3. Fax CapabilitiesBeing able to receive faxes is important to any business. Faxes are used to conduct business, send reports, take orders and receive memos every day. Using the virtual office fax, the client receives faxes which can be forwarded directly to his/her email.4. Part-time Office AccessSome virtual office services offer part-time access to a desk or work station with Internet capabilities, office equipment and more. This is available for those times when the client needs to organize a presentation before a conference or use the Internet or computer for business purposes.5. Conference Room AccessConference rooms are available for rent with some virtual office setups. The client can hold business meetings or give sales presentations without interruption.6. Web Conference Room AccessWeb conference rooms are available for virtual meetings. Rather than hold a physical meeting, the client can hold virtual business meetings or give virtual sales presentations. Virtual meetings have gained popularity in recent years because they save time and money while providing instant presentation opportunities. Some virtual office services offer this tool as an added service.7. Online virtual toolsOnline tools such as calendar, address book, webmail, document respository, to do's, forums, digital fax and digital voice mail have become common among many large businesses. Some virtual office services offer these tools and others as an added service.Who can Benefit by using a Virtual Office?People of all trades find virtual offices useful. Executives, salespeople, accountants, marketing consultants and online business owners each benefit by using a virtual office for certain tasks. Those who work from home and wish to establish a business presence find that a virtual office meets this need. Corporations also use virtual offices as a means of testing a business location before opening a new branch.When renting an office is not an option, a virtual office can be used by small business owners to meet the daily needs while saving time and money.
Getting More From Your Customer
: Matthew Tibble
We are all customers of one product or another. How is it we always seem to buy or shop from the same place? What is it that these businesses do to keep us coming back and buying from them? A large portion of the selection process that a customer goes through is done through advertising – attracting and reminding customers through promotions.Without doubt, the most effective strategy for retaining a customer is to provide excellent customer service, but you need them to sample your product or service initially. Once you receive their custom, you will need to remind them that you are there, willing and waiting for their next purchase!How do you do this? COMMUNICATION. There are some basic tools that a small business or large business can employ to improve their sales with their customer. These include:* Sales letters* Sales promotions* Email newsletters* Advertising* Customer service* TelemarketingYou will need to find out what the best avenue for communication is for your customer. If it is an online business, emails and sales letters might be the best option. If you have an off-line business, then maybe sales promotions inviting customers to a special VIP evening for a product release might be your best option.In reality, it is often a combination of communication tools that generates the most sales form your customer. You are constantly saying “Remember me? We were of great service to you last time, and are waiting to be able to provide you the same service again”. Begin making effective change in your customer communications today.
We are all customers of one product or another. How is it we always seem to buy or shop from the same place? What is it that these businesses do to keep us coming back and buying from them? A large portion of the selection process that a customer goes through is done through advertising – attracting and reminding customers through promotions.Without doubt, the most effective strategy for retaining a customer is to provide excellent customer service, but you need them to sample your product or service initially. Once you receive their custom, you will need to remind them that you are there, willing and waiting for their next purchase!How do you do this? COMMUNICATION. There are some basic tools that a small business or large business can employ to improve their sales with their customer. These include:* Sales letters* Sales promotions* Email newsletters* Advertising* Customer service* TelemarketingYou will need to find out what the best avenue for communication is for your customer. If it is an online business, emails and sales letters might be the best option. If you have an off-line business, then maybe sales promotions inviting customers to a special VIP evening for a product release might be your best option.In reality, it is often a combination of communication tools that generates the most sales form your customer. You are constantly saying “Remember me? We were of great service to you last time, and are waiting to be able to provide you the same service again”. Begin making effective change in your customer communications today.
Internal Control: A Preventive Maintenance Program
by: John Day
You read about this in every newspaper in every town in the entire country: Some bookkeeper, trusted by the owner of a small business, embezzles thousands of dollars. If the theft doesn’t put owner out of business, it certainly causes a major headache.The reason we hear of these cases so often is that, in a small business, there may only be the owner and a bookkeeper. The owner doesn’t like doing the books, doesn’t understand them, and relies on this one person to take care of things. The bookkeeper, who is usually having personal financial difficulties, takes a small amount of money intending to pay it back. No one seems to notice, so more is taken. Over a period of time, it starts to mount up to a lot of money.This is where the concept of “internal control” comes in. Essentially, every business should have, at some level, an internal control system in place to protect against losses, both intentional and unintentional. This is because “internal control” systems will: 1) protect cash and other assets; 2) promote efficiency in processing transactions; and, 3) ensure reliability of financial records. An internal control system consists primarily of policies and procedures designed to provide reasonable assurance that these three objectives will be achieved. The size and complexity of the business will determine the extent of the internal control system.Regardless of size, one of the most important aspects of an internal control system is the concept of separation of duties. Separating duties makes it more difficult for theft and errors to go undetected. It is highly unusual for two employees to “collude” in an effort to steal from the company.I worked as an internal auditor for a newspaper chain for three years. My job was to walk in to the newspaper offices unannounced and go directly to the cash boxes, count them, and verify receipts. One of my most important audit steps was to make sure the internal control procedures were in place and working properly. Here are a few suggestions for internal control procedures regarding handling of cash:- Allow only specific designated individuals to handle cash.- Give responsibility for bookkeeping to an individual who does not handle cash.- Use numbered receipts to document all payments.- Make all bank deposits promptly.- The person who prepares the bank reconciliation should be different than the one handling cash.- If possible, the person who makes the bank deposit should be different than the one who handles the cash and the one who prepares the bank reconciliation.- Make deposits intact with no amounts withdrawn to pay expenses.- Keep cash and checkbook in a locked drawer or cash register.- Since tills will never be 100 orrect all the time, establish a tolerance level for overages and shortages to determine the point at which corrective measures will be triggered.- Make all disbursements by check, except minimal amounts paid from petty cash.- Make certain every payment is related to a paper document, such as a voucher, to ensure that a paper trail exists for all disbursements.- Conduct random surprise counts of petty cash and cash drawers.- Count inventory and other assets frequently and compare with company books.An internal control system set up early as a preventative measure is more efficient than establishing a corrective system in reaction to a loss. If it so happens, that there is just you and the bookkeeper in your small business, you need to learn how to do some of the bookkeeping tasks so you can spot check the bookkeeper’s work. That, in itself, is an excellent preventative measure.
You read about this in every newspaper in every town in the entire country: Some bookkeeper, trusted by the owner of a small business, embezzles thousands of dollars. If the theft doesn’t put owner out of business, it certainly causes a major headache.The reason we hear of these cases so often is that, in a small business, there may only be the owner and a bookkeeper. The owner doesn’t like doing the books, doesn’t understand them, and relies on this one person to take care of things. The bookkeeper, who is usually having personal financial difficulties, takes a small amount of money intending to pay it back. No one seems to notice, so more is taken. Over a period of time, it starts to mount up to a lot of money.This is where the concept of “internal control” comes in. Essentially, every business should have, at some level, an internal control system in place to protect against losses, both intentional and unintentional. This is because “internal control” systems will: 1) protect cash and other assets; 2) promote efficiency in processing transactions; and, 3) ensure reliability of financial records. An internal control system consists primarily of policies and procedures designed to provide reasonable assurance that these three objectives will be achieved. The size and complexity of the business will determine the extent of the internal control system.Regardless of size, one of the most important aspects of an internal control system is the concept of separation of duties. Separating duties makes it more difficult for theft and errors to go undetected. It is highly unusual for two employees to “collude” in an effort to steal from the company.I worked as an internal auditor for a newspaper chain for three years. My job was to walk in to the newspaper offices unannounced and go directly to the cash boxes, count them, and verify receipts. One of my most important audit steps was to make sure the internal control procedures were in place and working properly. Here are a few suggestions for internal control procedures regarding handling of cash:- Allow only specific designated individuals to handle cash.- Give responsibility for bookkeeping to an individual who does not handle cash.- Use numbered receipts to document all payments.- Make all bank deposits promptly.- The person who prepares the bank reconciliation should be different than the one handling cash.- If possible, the person who makes the bank deposit should be different than the one who handles the cash and the one who prepares the bank reconciliation.- Make deposits intact with no amounts withdrawn to pay expenses.- Keep cash and checkbook in a locked drawer or cash register.- Since tills will never be 100 orrect all the time, establish a tolerance level for overages and shortages to determine the point at which corrective measures will be triggered.- Make all disbursements by check, except minimal amounts paid from petty cash.- Make certain every payment is related to a paper document, such as a voucher, to ensure that a paper trail exists for all disbursements.- Conduct random surprise counts of petty cash and cash drawers.- Count inventory and other assets frequently and compare with company books.An internal control system set up early as a preventative measure is more efficient than establishing a corrective system in reaction to a loss. If it so happens, that there is just you and the bookkeeper in your small business, you need to learn how to do some of the bookkeeping tasks so you can spot check the bookkeeper’s work. That, in itself, is an excellent preventative measure.
Small Business Debt Collection Letter Writing
by: Joel Walsh
Writing a debt collection letter is one of the most important skills of any small business owner. Do you have what it takes to get the money you’ve earned?I have a confession: I'm a business writer who's let clients get away with not paying me--a huge sign of failure of my writing abilities. You see, I never learned one of the most important writing skills for any self-employed person or small business owner: how to write a debt collection letter.Debt collection letters--an overview"Debt collection letter" in the singular may be an oxymoron, since unfortunately, one is rarely enough. You should have a series of letters to send to deadbeat clients, each one becoming a little more insistent. Here are some ideas for a five-letter series.1. Don’t make your first letter look like a collection letter at all. Make it a friendly note. You’re more likely to get money from someone who thinks of you as a partner than a dun.2. If that first letter doesn’t get a response--and usually it won’t--send another the next week that’s more urgent and directly asks for the money. Express your concern that you have not been able to contact the client. Ask if he or she is all right, and if he or she is having any trouble paying.3. The next week, if you still have not gotten a response, send a letter referring to the payment terms in the agreement you and the client originally made (you did have some kind of written agreement, even if it was just on the back of your invoice, right?). Mention the effect this nonpayment is having on your cash flow, and that your business’s cash flow is just as important as theirs.4. Still no response by the next week? State plainly that you are asking for the money for the final time before referring it to collections. Include a copy of the entire agreement between you and the client.5. If you still have not heard back from the client, and are confident that you do not simply have a problem with their contact information, call a collection agency—in fact, you may have wanted to have gotten a collection agency from step one (more on that below).More Tips for Successful Debt CollectionsTip: Don’t wait to start asking for your money.If it’s been a week since the payment deadline passed, it’s been a week too long. Send out that first “reminder” letter today. Don’t hesitate to send these letters as little as a week apart from each other. The longer your bill goes unpaid, the less likely it is you will ever see that money again.Tip: If you’ve been sending email, try sending paper.For whatever reason, there are people who take a paper letter more seriously. There’s also the real chance that your emails really are not getting through reliably, or are ending up at the bottom of an overflowing Inbox.If you do send email, make sure it’s digitally signed. A digital signature proves that you sent the email to the specific recipient. In fact, you might want to make sure all your emails to clients and prospects are digitally signed, to have solid documentation of everything you said, and everything they owe.Unlike with regular emails, the date, time, “to” and “from” fields can’t be forged, so the email has legal standing, even more than certified mail. While web-based email programs cannot send digitally signed email, there are third-party services that will let you send hundreds of digitally signed emails from a desktop email program for only a few dollars a month.Tip: Follow up your debt collection letter with a telephone call.As any collection agency will tell you, telephone calls are useful if your debtor has ignored the collection letters. But with caller ID, Caller Blocking and voice mail - if people don't want to take your calls it is hard to reach them. This technique could be especially effective in the case of someone with whom you know will answer their own phone.Of course, your writing skills won’t go to waste: you need to make sure you have scripted what you want to say. You should take the same attitude and touch on the same points as your letter. Whatever you do, don’t let yourself get sidetracked, and don’t be embarrassed. They’re the ones who are putting you out.Don’t know your deadbeat’s telephone number? Try looking up the “Whois” record of the business’s website, which usually has the owner’s telephone number.Does all this sound like too much work?If you’d rather be writing proposals than collection letters, there are small business collection agencies that will take on debts for as little as $20 each. After all, your client had enough sense to go to you rather than doing your specialty themselves. Shouldn’t you have as much sense when it comes to your debt collection letters?
Writing a debt collection letter is one of the most important skills of any small business owner. Do you have what it takes to get the money you’ve earned?I have a confession: I'm a business writer who's let clients get away with not paying me--a huge sign of failure of my writing abilities. You see, I never learned one of the most important writing skills for any self-employed person or small business owner: how to write a debt collection letter.Debt collection letters--an overview"Debt collection letter" in the singular may be an oxymoron, since unfortunately, one is rarely enough. You should have a series of letters to send to deadbeat clients, each one becoming a little more insistent. Here are some ideas for a five-letter series.1. Don’t make your first letter look like a collection letter at all. Make it a friendly note. You’re more likely to get money from someone who thinks of you as a partner than a dun.2. If that first letter doesn’t get a response--and usually it won’t--send another the next week that’s more urgent and directly asks for the money. Express your concern that you have not been able to contact the client. Ask if he or she is all right, and if he or she is having any trouble paying.3. The next week, if you still have not gotten a response, send a letter referring to the payment terms in the agreement you and the client originally made (you did have some kind of written agreement, even if it was just on the back of your invoice, right?). Mention the effect this nonpayment is having on your cash flow, and that your business’s cash flow is just as important as theirs.4. Still no response by the next week? State plainly that you are asking for the money for the final time before referring it to collections. Include a copy of the entire agreement between you and the client.5. If you still have not heard back from the client, and are confident that you do not simply have a problem with their contact information, call a collection agency—in fact, you may have wanted to have gotten a collection agency from step one (more on that below).More Tips for Successful Debt CollectionsTip: Don’t wait to start asking for your money.If it’s been a week since the payment deadline passed, it’s been a week too long. Send out that first “reminder” letter today. Don’t hesitate to send these letters as little as a week apart from each other. The longer your bill goes unpaid, the less likely it is you will ever see that money again.Tip: If you’ve been sending email, try sending paper.For whatever reason, there are people who take a paper letter more seriously. There’s also the real chance that your emails really are not getting through reliably, or are ending up at the bottom of an overflowing Inbox.If you do send email, make sure it’s digitally signed. A digital signature proves that you sent the email to the specific recipient. In fact, you might want to make sure all your emails to clients and prospects are digitally signed, to have solid documentation of everything you said, and everything they owe.Unlike with regular emails, the date, time, “to” and “from” fields can’t be forged, so the email has legal standing, even more than certified mail. While web-based email programs cannot send digitally signed email, there are third-party services that will let you send hundreds of digitally signed emails from a desktop email program for only a few dollars a month.Tip: Follow up your debt collection letter with a telephone call.As any collection agency will tell you, telephone calls are useful if your debtor has ignored the collection letters. But with caller ID, Caller Blocking and voice mail - if people don't want to take your calls it is hard to reach them. This technique could be especially effective in the case of someone with whom you know will answer their own phone.Of course, your writing skills won’t go to waste: you need to make sure you have scripted what you want to say. You should take the same attitude and touch on the same points as your letter. Whatever you do, don’t let yourself get sidetracked, and don’t be embarrassed. They’re the ones who are putting you out.Don’t know your deadbeat’s telephone number? Try looking up the “Whois” record of the business’s website, which usually has the owner’s telephone number.Does all this sound like too much work?If you’d rather be writing proposals than collection letters, there are small business collection agencies that will take on debts for as little as $20 each. After all, your client had enough sense to go to you rather than doing your specialty themselves. Shouldn’t you have as much sense when it comes to your debt collection letters?
The 8 Toughest Business Questions
by: Michael Brassil
Do you ever wonder if you will really succeed with yoursmall business? You may have a number of special traits, buthow well developed are they? There are qualities of endeavorand achievement that are common to successful businessowners. Ask yourself these questions to see if you have whatit takes.1. How will the business affect your family? The first fewyears of business startup can be hard on family life. Thestrain of an unsupportive spouse may be hard to balanceagainst the demands of starting a business. There also maybe financial difficulties until the business becomesprofitable, which could take months or years. You may haveto adjust to a lower standard of living or put family assetsat risk.2. How will you support your family while building up yourbusiness? This question must be worked out according toeach persons’ individual circumstances. Many people startout on a part-time basis. Then when their incomes reach acertain level they will switch over to full time. Granted,if you take this "safer and surer" approach, it may take youlonger to reach the goals you set for your new business, butyou will save yourself (and those who depend on youfinancially) a lot of anxiety. Ultimately, like the turtlein the race who moved ahead slowly yet steadily, you willhave a greater chance of reaching the finish line.3. How well do you get along with different personalities?Business owners need to develop working relationships with avariety of people including: customers; vendors, staff;bankers; and professionals such as lawyers, accountants andconsultants. Can you deal with a demanding client, anunreliable vendor or cranky staff person in the bestinterest of your business?4. How good are you at making decisions? Small businessowners are constantly required to make decisions underpressure.5. Do you have the physical and emotional stamina to run abusiness? Business ownership can be challenging andexciting. But it is also a lot of work. Can you face 12hourwork days for six or seven days a week?6. How well do you plan and organize? Research indicatesthat many business failures could have been avoided throughbetter planning. Good organization of: financials;inventory; schedules; production; can help avoid pitfalls.7. Do you have the drive to maintain your motivation?Running a business can wear you down. Some business ownersfeel burned out by having to carry all the responsibility ontheir shoulders. Strong motivation can help to surviveslowdowns, as well as periods of burnout.8. Do you have the discipline to do what has to be done?When working for someone else, it becomes routine to riseearly, be well-groomed and get to the office on time.However, a significant number of people starting up a smallbusiness at home all too often find themselves at 10:00 inthe morning in their bathrobes, drinking a second or thirdcup of coffee.Make no mistake, starting a successful small business ishard work. BUT, it is also highly rewarding! Attack thechallenge head-on and success will be yours.
Do you ever wonder if you will really succeed with yoursmall business? You may have a number of special traits, buthow well developed are they? There are qualities of endeavorand achievement that are common to successful businessowners. Ask yourself these questions to see if you have whatit takes.1. How will the business affect your family? The first fewyears of business startup can be hard on family life. Thestrain of an unsupportive spouse may be hard to balanceagainst the demands of starting a business. There also maybe financial difficulties until the business becomesprofitable, which could take months or years. You may haveto adjust to a lower standard of living or put family assetsat risk.2. How will you support your family while building up yourbusiness? This question must be worked out according toeach persons’ individual circumstances. Many people startout on a part-time basis. Then when their incomes reach acertain level they will switch over to full time. Granted,if you take this "safer and surer" approach, it may take youlonger to reach the goals you set for your new business, butyou will save yourself (and those who depend on youfinancially) a lot of anxiety. Ultimately, like the turtlein the race who moved ahead slowly yet steadily, you willhave a greater chance of reaching the finish line.3. How well do you get along with different personalities?Business owners need to develop working relationships with avariety of people including: customers; vendors, staff;bankers; and professionals such as lawyers, accountants andconsultants. Can you deal with a demanding client, anunreliable vendor or cranky staff person in the bestinterest of your business?4. How good are you at making decisions? Small businessowners are constantly required to make decisions underpressure.5. Do you have the physical and emotional stamina to run abusiness? Business ownership can be challenging andexciting. But it is also a lot of work. Can you face 12hourwork days for six or seven days a week?6. How well do you plan and organize? Research indicatesthat many business failures could have been avoided throughbetter planning. Good organization of: financials;inventory; schedules; production; can help avoid pitfalls.7. Do you have the drive to maintain your motivation?Running a business can wear you down. Some business ownersfeel burned out by having to carry all the responsibility ontheir shoulders. Strong motivation can help to surviveslowdowns, as well as periods of burnout.8. Do you have the discipline to do what has to be done?When working for someone else, it becomes routine to riseearly, be well-groomed and get to the office on time.However, a significant number of people starting up a smallbusiness at home all too often find themselves at 10:00 inthe morning in their bathrobes, drinking a second or thirdcup of coffee.Make no mistake, starting a successful small business ishard work. BUT, it is also highly rewarding! Attack thechallenge head-on and success will be yours.
I Don't Want to be Different
by: Brian Grinonneau
I Don’t Want to be DifferentTo succeed in today’s crowded marketplace where most of the products and advertising look exactly the same, a small business owner must stand out, shouting above the din with a message so clear and compelling that prospects stop and take notice. It’s a matter of business survival. Unfortunately, most entrepreneurs quickly retreat to the supposed security of sameness, soon to be lost in a sea of anonymity and a tidal wave of frustration. In effect, albeit at a subconscious level, they are saying , “I don’t want to be different”.In back room offices and store fronts everywhere, salespeople are telling business owners they should do this or that kind of ad because it worked so great for their competitor. The owners nod and sign on. It’s already proven to be a winner, right? WRONG! Change the name, background color and a font style and you’ve got sameness. Put those ads in the yellow pages, a coupon magazine or a TV commercial cluster and you’ve got advertising death. Want proof? Ask a small business owner how well their advertising is working. Don’t stand too close waiting for the answer.To make your advertising work, follow the principle if your competition is doing it, don’t. Go where they aren’t and win the battle without a fight. Resist the urge to get a listing in the phone book because that’s where everyone else is. A coupon direct mailer that features 6 or 7 of your competitors is a poor choice too. Look for new opportunities in direct mail and email campaigns. Look at direct response ideas. In short, try to find the biggest number of clients you can find in one spot. Fish in a barrel, not the ocean.When you’ve chosen different channels to attract your customers, make sure you overcome the “so-what” factor in your copywriting. An ad for a heating and air conditioning company that says it has certified technicians that will fix your problem quickly is a so-what line. No one is looking for uncertified slackers that will get around to the problem whenever. A moving company that mentions superior insurance coverage makes you think they’ll probably break something. Be creative and write copy that will compel prospects to take action.Consumers are bombarded by thousands of ad messages every day. There is so much overload they tune everything out. To get their attention, look within your business and find all that you do differently and decide which of those elements your customers most want. Decide how to word it best. and where to position it. Decide you really do want to be different. You have to. Your business depends on it.
I Don’t Want to be DifferentTo succeed in today’s crowded marketplace where most of the products and advertising look exactly the same, a small business owner must stand out, shouting above the din with a message so clear and compelling that prospects stop and take notice. It’s a matter of business survival. Unfortunately, most entrepreneurs quickly retreat to the supposed security of sameness, soon to be lost in a sea of anonymity and a tidal wave of frustration. In effect, albeit at a subconscious level, they are saying , “I don’t want to be different”.In back room offices and store fronts everywhere, salespeople are telling business owners they should do this or that kind of ad because it worked so great for their competitor. The owners nod and sign on. It’s already proven to be a winner, right? WRONG! Change the name, background color and a font style and you’ve got sameness. Put those ads in the yellow pages, a coupon magazine or a TV commercial cluster and you’ve got advertising death. Want proof? Ask a small business owner how well their advertising is working. Don’t stand too close waiting for the answer.To make your advertising work, follow the principle if your competition is doing it, don’t. Go where they aren’t and win the battle without a fight. Resist the urge to get a listing in the phone book because that’s where everyone else is. A coupon direct mailer that features 6 or 7 of your competitors is a poor choice too. Look for new opportunities in direct mail and email campaigns. Look at direct response ideas. In short, try to find the biggest number of clients you can find in one spot. Fish in a barrel, not the ocean.When you’ve chosen different channels to attract your customers, make sure you overcome the “so-what” factor in your copywriting. An ad for a heating and air conditioning company that says it has certified technicians that will fix your problem quickly is a so-what line. No one is looking for uncertified slackers that will get around to the problem whenever. A moving company that mentions superior insurance coverage makes you think they’ll probably break something. Be creative and write copy that will compel prospects to take action.Consumers are bombarded by thousands of ad messages every day. There is so much overload they tune everything out. To get their attention, look within your business and find all that you do differently and decide which of those elements your customers most want. Decide how to word it best. and where to position it. Decide you really do want to be different. You have to. Your business depends on it.
How Most Millionaires get to be Millionaires...
by: Daegan Smith
Why do so many people claim that money isn’t important? Why is there this notion that wanting money somehow makes you an ill adjusted bad human being? It’s such a strange thought pattern don’t you think?Wanting more money in your life doesn’t mean you’re a bad person. It doesn’t mean you’re greedy either. It just means you want more out of life. You want more freedom. You want more security. You want more fun. Whatever it is, you just want more. Money is just simple a means to that end.I hoe I don’t let the cat out of the bag, but that’s what this whole home business gig is anyway. Someone sells you on the idea that you can make tons of money working from home as an independent contractor or distributor for this company or that. And, it’s not that you ever buy into the promise that the home business is selling, but you take a leap of faith and give it a try.We start small, maybe $20 for a book about real estate investing. I know my first brush with the thought that I could be independently wealthy working from home was when I came across an ad for the ebook Googlecash (if you don’t know what I’m talking about just do a quick google search). The idea seemed so easy and so low risk I figured why not give it a try.That was the beginning, almost a year ago. Here I am now writing to you about my home business experiences. In that time, I’ve bought an apartment building and learned just about everything there is to learn about starting and running a business from home. And guess what? If you haven’t caught on to this yet, no matter what the ads tell you, no home business is as simple or as cheap as the ad would have you believe. But I digress.Let me get to the point though. Let’s discuss the title of this little article. Most millionaires become millionaires by starting a small business, saving their revenue, and then investing. It really is that simple. Let me say that again, all you have to do to become a millionaire is start a small business, save, and invest.So, what do millionaire look like? Well, most are in their sixties and living the same type house that you and I live in. They look like us. They dress like us. They are us. The only difference is they have a whole lot more money in the bank.Here’s a fact that I hope will hit home. There are twice as many millionaire small business owners than there are millionaire doctors or lawyers combined. So, if you own a home based business or you’re thinking about checking out some legitimate home based business opportunities then your on the right track. Just stick with it and don’t give up!Remember most millionaires are get to be millionaires by being just like you and me, they’re home business entrepreneurs!
Why do so many people claim that money isn’t important? Why is there this notion that wanting money somehow makes you an ill adjusted bad human being? It’s such a strange thought pattern don’t you think?Wanting more money in your life doesn’t mean you’re a bad person. It doesn’t mean you’re greedy either. It just means you want more out of life. You want more freedom. You want more security. You want more fun. Whatever it is, you just want more. Money is just simple a means to that end.I hoe I don’t let the cat out of the bag, but that’s what this whole home business gig is anyway. Someone sells you on the idea that you can make tons of money working from home as an independent contractor or distributor for this company or that. And, it’s not that you ever buy into the promise that the home business is selling, but you take a leap of faith and give it a try.We start small, maybe $20 for a book about real estate investing. I know my first brush with the thought that I could be independently wealthy working from home was when I came across an ad for the ebook Googlecash (if you don’t know what I’m talking about just do a quick google search). The idea seemed so easy and so low risk I figured why not give it a try.That was the beginning, almost a year ago. Here I am now writing to you about my home business experiences. In that time, I’ve bought an apartment building and learned just about everything there is to learn about starting and running a business from home. And guess what? If you haven’t caught on to this yet, no matter what the ads tell you, no home business is as simple or as cheap as the ad would have you believe. But I digress.Let me get to the point though. Let’s discuss the title of this little article. Most millionaires become millionaires by starting a small business, saving their revenue, and then investing. It really is that simple. Let me say that again, all you have to do to become a millionaire is start a small business, save, and invest.So, what do millionaire look like? Well, most are in their sixties and living the same type house that you and I live in. They look like us. They dress like us. They are us. The only difference is they have a whole lot more money in the bank.Here’s a fact that I hope will hit home. There are twice as many millionaire small business owners than there are millionaire doctors or lawyers combined. So, if you own a home based business or you’re thinking about checking out some legitimate home based business opportunities then your on the right track. Just stick with it and don’t give up!Remember most millionaires are get to be millionaires by being just like you and me, they’re home business entrepreneurs!
For Entrepreneurs A Simple IRA May Be Best
by: Tim Knox
Q: I own a small decorating business and I’ll be the first to admit that I don’t know anything about taxes or retirement plans. I’d like to set up a 401(k) or an IRA or some other kind of retirement plan for me and my three employees. What are the various retirement plan options available for a small business owner and in your opinion, which would work best for me?-- Wanda S.A: Wanda, I appreciate your confidence in my humble opinion, but asking me for financial advice is like asking Donald Trump for a recommendation on hair care products. I can tell you what works best for me and my business, but you’ll need to do your homework and seek professional advice to figure out what would work best for you. As a side note, I hear that Donald Trump is coming out with his own line of hair care product soon to be called “Big Head.” The formula is 1ousse, 1iquid nails, and 98ot air. It should be a big seller among the high brow, comb-over crowd.Here’s my best advice on retirement plans: find yourself a financial advisor (or financial planner) who is has experience working with small businesses and have him or her explain the options available and make a recommendation as to the type of plan best suited for you and your business. When I say “financial advisor” I’m not talking about your know-it-all brother-in-law or your accountant. I’m talking about a broker or financial planner (or other licensed professional) who has a proven track record of making his clients money and is an expert on IRAs, 401(k)s, mutual funds, etc.The best way to find a good financial advisor is to ask for referrals from your most successful friends and associates. Find the richest, stingiest man in town and ask who his advisor is. Meet with several advisors, explain your situation, and ask for their recommendations. You should also make sure the advisor is a good fit for your personality and your business. If all goes well you will be doing business with this person for many years to come, so make sure the relationship feels comfortable to you and that you are confident in the advisor’s ability to manage your money.Let me give you a quick overview of a few of the retirement plans available to small businesses so you at least have an idea of what’s out there before you start your search for a good financial advisor.As a small business you basically have three types of retirement plans that you can take advantage of: the Self-Employed 401(k); the Simplified Employee Pension Plan or SEP IRA, and the Savings Incentive Match Plan for Employees or SIMPLE IRA. Each allows you to make pre-tax contributions to the plan, which lets you save for retirement and lessen your taxable income by the amount of the contribution. Your investments also grow tax-deferred until withdrawal.A Self-Employed 401(k) is an option for self-employed individuals or business owners with no employees other than a spouse. The business can be a sole proprietorship, a partnership, or a corporation, including S corps. You can make salary deferrals to this type of plan of up to $14,000 for 2005.Next is the Simplified Employee Pension Plan or SEP IRA. A SEP is an option if you earn a self-employed income from a full or part time business, even if you are covered by a retirement plan at your fulltime job. A SEP allows you to contribute up to 25f earned income, up to $41,000 for 2004 and $42,000 for 2005.My preferred type of retirement plan is the Savings Incentive Match Plan for Employees or SIMPLE IRA. The SIMPLE IRA was created to make it easier for small businesses with 100 or fewer employees to offer a tax-advantaged, company sponsored retirement plan.With a SIMPLE IRA you and your eligible employees may contribute up to 3f earned income (with a maximum contribution of $10,000) on a pre-tax basis to individual SIMPLE IRAs. You must deduct Social Security and Medicaid from your gross income, but you can then make your SIMPLE IRA contribution before other taxes are levied, effectively lowering your taxable income.As the employer you must make “matching” or “non-elective” contributions into your employees’ SIMPLE IRA accounts. Matching contributions means that the business matches the elective deferral contributions made by employees. For example, if the employee opts to contribute 3f his salary to the plan, the employer must match the 3 ontribution.At first you might cringe at matching your employees’ contributions, but as the business owner and an employee yourself this can be great news. As an employee of your own business you can contribute up to $10,000 to your SIMPLE IRA and the business can then match your contribution dollar-for-dollar, which means that you can put up to $20,000 in tax free dollars into the plan per year. The cost of the contributions is also deductible as a business expense.The non-elective contribution option requires that the company contribute 2f every employee’s earned income to the plan on the employee’s behalf regardless of whether or not the employee contributes to the plan himself. For 2005 the maximum contribution you would be required to make is $4,200.Like a traditional IRA, you can withdraw money from a SIMPLE IRA at any time; however distributions within the first two years of participation are subject to higher early withdrawal penalties than traditional IRAs or Roth IRAs. Withdrawals within the first two years are subject to a 25arly withdrawal penalty. Withdrawals taken after the first two years are subject to a 10arly withdrawal penalty.As the employer, the advantages of a SIMPLE IRA include: company contributions to the plan are tax deductible as a business expense; plan documents are simple and easy to administer; administration costs are low; and there is no government reporting required by the employer.The advantages of a SIMPLE IRA for your employees include: contributions are immediately 100ested; contributions and earnings are tax-deferred until withdrawal; employees can contribute 100f earned income up to $10,000 for 2005; and employees can direct their own investments within the IRA.This is a complex topic and I’ve just tipped the iceberg here, but hopefully this will give you enough information to get the investment ball rolling.
Q: I own a small decorating business and I’ll be the first to admit that I don’t know anything about taxes or retirement plans. I’d like to set up a 401(k) or an IRA or some other kind of retirement plan for me and my three employees. What are the various retirement plan options available for a small business owner and in your opinion, which would work best for me?-- Wanda S.A: Wanda, I appreciate your confidence in my humble opinion, but asking me for financial advice is like asking Donald Trump for a recommendation on hair care products. I can tell you what works best for me and my business, but you’ll need to do your homework and seek professional advice to figure out what would work best for you. As a side note, I hear that Donald Trump is coming out with his own line of hair care product soon to be called “Big Head.” The formula is 1ousse, 1iquid nails, and 98ot air. It should be a big seller among the high brow, comb-over crowd.Here’s my best advice on retirement plans: find yourself a financial advisor (or financial planner) who is has experience working with small businesses and have him or her explain the options available and make a recommendation as to the type of plan best suited for you and your business. When I say “financial advisor” I’m not talking about your know-it-all brother-in-law or your accountant. I’m talking about a broker or financial planner (or other licensed professional) who has a proven track record of making his clients money and is an expert on IRAs, 401(k)s, mutual funds, etc.The best way to find a good financial advisor is to ask for referrals from your most successful friends and associates. Find the richest, stingiest man in town and ask who his advisor is. Meet with several advisors, explain your situation, and ask for their recommendations. You should also make sure the advisor is a good fit for your personality and your business. If all goes well you will be doing business with this person for many years to come, so make sure the relationship feels comfortable to you and that you are confident in the advisor’s ability to manage your money.Let me give you a quick overview of a few of the retirement plans available to small businesses so you at least have an idea of what’s out there before you start your search for a good financial advisor.As a small business you basically have three types of retirement plans that you can take advantage of: the Self-Employed 401(k); the Simplified Employee Pension Plan or SEP IRA, and the Savings Incentive Match Plan for Employees or SIMPLE IRA. Each allows you to make pre-tax contributions to the plan, which lets you save for retirement and lessen your taxable income by the amount of the contribution. Your investments also grow tax-deferred until withdrawal.A Self-Employed 401(k) is an option for self-employed individuals or business owners with no employees other than a spouse. The business can be a sole proprietorship, a partnership, or a corporation, including S corps. You can make salary deferrals to this type of plan of up to $14,000 for 2005.Next is the Simplified Employee Pension Plan or SEP IRA. A SEP is an option if you earn a self-employed income from a full or part time business, even if you are covered by a retirement plan at your fulltime job. A SEP allows you to contribute up to 25f earned income, up to $41,000 for 2004 and $42,000 for 2005.My preferred type of retirement plan is the Savings Incentive Match Plan for Employees or SIMPLE IRA. The SIMPLE IRA was created to make it easier for small businesses with 100 or fewer employees to offer a tax-advantaged, company sponsored retirement plan.With a SIMPLE IRA you and your eligible employees may contribute up to 3f earned income (with a maximum contribution of $10,000) on a pre-tax basis to individual SIMPLE IRAs. You must deduct Social Security and Medicaid from your gross income, but you can then make your SIMPLE IRA contribution before other taxes are levied, effectively lowering your taxable income.As the employer you must make “matching” or “non-elective” contributions into your employees’ SIMPLE IRA accounts. Matching contributions means that the business matches the elective deferral contributions made by employees. For example, if the employee opts to contribute 3f his salary to the plan, the employer must match the 3 ontribution.At first you might cringe at matching your employees’ contributions, but as the business owner and an employee yourself this can be great news. As an employee of your own business you can contribute up to $10,000 to your SIMPLE IRA and the business can then match your contribution dollar-for-dollar, which means that you can put up to $20,000 in tax free dollars into the plan per year. The cost of the contributions is also deductible as a business expense.The non-elective contribution option requires that the company contribute 2f every employee’s earned income to the plan on the employee’s behalf regardless of whether or not the employee contributes to the plan himself. For 2005 the maximum contribution you would be required to make is $4,200.Like a traditional IRA, you can withdraw money from a SIMPLE IRA at any time; however distributions within the first two years of participation are subject to higher early withdrawal penalties than traditional IRAs or Roth IRAs. Withdrawals within the first two years are subject to a 25arly withdrawal penalty. Withdrawals taken after the first two years are subject to a 10arly withdrawal penalty.As the employer, the advantages of a SIMPLE IRA include: company contributions to the plan are tax deductible as a business expense; plan documents are simple and easy to administer; administration costs are low; and there is no government reporting required by the employer.The advantages of a SIMPLE IRA for your employees include: contributions are immediately 100ested; contributions and earnings are tax-deferred until withdrawal; employees can contribute 100f earned income up to $10,000 for 2005; and employees can direct their own investments within the IRA.This is a complex topic and I’ve just tipped the iceberg here, but hopefully this will give you enough information to get the investment ball rolling.
Don’t Let Passions Rule When Buying A Business
by: David E Coffman CPA/ABV, CVA
For many, the American dream of owning a business is in queue right behind owning a home. I was a teenager when I owned my first business. Since then I have bought or started many businesses and helped others do the same. Here are some common mistakes I have witnessed or committed myself.Paying too muchThis results from the combination of all other mistakes. Many new business owners set themselves up for failure by paying too much, which results in higher loan payments, lower operating funds, and reduced borrowing capacity.Letting your emotions ruleIf you have always dreamed of owning a business, it is very easy to get caught up in the strong emotions invoked by seeing those dreams coming true. To counteract your emotions, take your time, do your homework, and enlist the help of objective advisors.Paying for potentialYou should only pay for the business as it stands at the date of purchase, not what it could be in the future. You will have to spend time, effort, and money to develop its potential. The seller chose not to invest these things, so he does not deserve to be paid for them.Not evaluating yourselfDo you have what it takes to run this business? Try to match your strengths to the important duties you will be required to perform. Running a small business requires the owner to do many things. No one can be good at them all, so make provisions for those areas in which you are the weakest. Some tasks like payroll and bookkeeping can easily be contracted to outside vendors. Possibly your spouse, other family member, or a partner could do things that you cannot or do not want to do.Not building a team of expertsAt a bare minimum, you should enlist the aid of an attorney and a CPA. The attorney can prepare and review documents, help structure the deal, and make you aware of legal and liability issues. The CPA can provide a financial analysis of the business, and advise you about tax and accounting matters. You should consider adding a business valuation professional. His valuation report can be used to determine the reasonableness of the asking price, negotiate a lower price, and provide valuable information about the business, the industry, the competition, and the economic conditions.Relying on bad informationYou should verify all important information about the business. Your CPA can check financial information like receivables, payables, and inventory. Your attorney can review loan documents, leases, and contracts. Your business valuation professional can analyze the competition, the industry, and the economic conditions. Use independent appraisers to value real estate and equipment. Get a credit report on the business through your CPA or banker. You can do some of the investigating yourself to save money, but do not cut too many corners – it may cost you in the long run.Changing too much, too fastOnce you own the business, you will be tempted to start making wholesale changes from day one. You risk alienating long-time employees and customers. Unless the business is in bad financial condition and needs immediate action, its better to take some time to get to know the business, your employees, and your customers before making changes. This is a perfect time to solicit suggestions from employees and customers.Buying a business because you like to do what the business doesOne reason restaurants have a high failure rate is people buy or start them because they like to cook. Very few restaurant owners spend time cooking. Their time is spent managing staff, ordering supplies, doing paperwork, and handling daily crises. A small business owner must wear many hats – including that of manager.Not being interested in the business’s product or serviceI made the mistake of thinking that because I am a CPA and smart that I could own and operate any business. I bought a business that sold high-performance auto parts to young men who drove jacked-up, four-wheel drive pickup trucks and went to the drag races every weekend. I did not do either and never understood why anyone would. I could not relate to my customers and went out of business in about a year.ConclusionBuying a business is a complicated, emotional process. By avoiding these costly mistakes, you can prevent turning your dream into a nightmare
For many, the American dream of owning a business is in queue right behind owning a home. I was a teenager when I owned my first business. Since then I have bought or started many businesses and helped others do the same. Here are some common mistakes I have witnessed or committed myself.Paying too muchThis results from the combination of all other mistakes. Many new business owners set themselves up for failure by paying too much, which results in higher loan payments, lower operating funds, and reduced borrowing capacity.Letting your emotions ruleIf you have always dreamed of owning a business, it is very easy to get caught up in the strong emotions invoked by seeing those dreams coming true. To counteract your emotions, take your time, do your homework, and enlist the help of objective advisors.Paying for potentialYou should only pay for the business as it stands at the date of purchase, not what it could be in the future. You will have to spend time, effort, and money to develop its potential. The seller chose not to invest these things, so he does not deserve to be paid for them.Not evaluating yourselfDo you have what it takes to run this business? Try to match your strengths to the important duties you will be required to perform. Running a small business requires the owner to do many things. No one can be good at them all, so make provisions for those areas in which you are the weakest. Some tasks like payroll and bookkeeping can easily be contracted to outside vendors. Possibly your spouse, other family member, or a partner could do things that you cannot or do not want to do.Not building a team of expertsAt a bare minimum, you should enlist the aid of an attorney and a CPA. The attorney can prepare and review documents, help structure the deal, and make you aware of legal and liability issues. The CPA can provide a financial analysis of the business, and advise you about tax and accounting matters. You should consider adding a business valuation professional. His valuation report can be used to determine the reasonableness of the asking price, negotiate a lower price, and provide valuable information about the business, the industry, the competition, and the economic conditions.Relying on bad informationYou should verify all important information about the business. Your CPA can check financial information like receivables, payables, and inventory. Your attorney can review loan documents, leases, and contracts. Your business valuation professional can analyze the competition, the industry, and the economic conditions. Use independent appraisers to value real estate and equipment. Get a credit report on the business through your CPA or banker. You can do some of the investigating yourself to save money, but do not cut too many corners – it may cost you in the long run.Changing too much, too fastOnce you own the business, you will be tempted to start making wholesale changes from day one. You risk alienating long-time employees and customers. Unless the business is in bad financial condition and needs immediate action, its better to take some time to get to know the business, your employees, and your customers before making changes. This is a perfect time to solicit suggestions from employees and customers.Buying a business because you like to do what the business doesOne reason restaurants have a high failure rate is people buy or start them because they like to cook. Very few restaurant owners spend time cooking. Their time is spent managing staff, ordering supplies, doing paperwork, and handling daily crises. A small business owner must wear many hats – including that of manager.Not being interested in the business’s product or serviceI made the mistake of thinking that because I am a CPA and smart that I could own and operate any business. I bought a business that sold high-performance auto parts to young men who drove jacked-up, four-wheel drive pickup trucks and went to the drag races every weekend. I did not do either and never understood why anyone would. I could not relate to my customers and went out of business in about a year.ConclusionBuying a business is a complicated, emotional process. By avoiding these costly mistakes, you can prevent turning your dream into a nightmare
Accounting Methods – Cash and Accrual
by: Richard A. Chapo
When starting a business, you have to determine the method you are going to use for accounting and paying taxes. The two choices are the cash method and the accrual method. Cash MethodIf you are looking for simplicity, the cash method is probably your best accounting choice. Generally, income and deductions can be claimed when payment is actually received or made. This is best shown with an example. I open a small business and have to order business cards and stationary. I receive the products and pay the invoice on November 18, 2005. Under the cash method, I can deduct the cost on my 2005 tax return. Some businesses are restricted from using the cash method. C corporations may only use the cash method if they have less than $5 million in gross revenues for a particular year. Professional Service Corporations can use the cash method without limit, while farming corporations can due so if gross revenues are less than $25 million. Tax shelters are prohibited from using the cash method. Accrual MethodThe Accrual Method of accounting is a bit more complex. Under this method, the focus in on the date the expense is incurred, not paid. Although this may seem a small difference, it can play havoc with your books and piece of mind. Using our previous example, assume I order business cards and stationary on the December 18, 2005. I receive the products on December 30th, but don’t pay the invoice until January 20, 2006. When can the expense be claimed? It depends on when economic performance occurred. Generally, economic performance occurs when goods or services are provided to you. In the above example, economic performance would arguably occur when the business cards and stationary were delivered with the invoice on December 30th. Thus, I would be able to deduct the expense for the 2005 tax year. In ClosingAs you can see, the cash method is the easier of the two accounting methods. To determine the best method for your business, speak with a tax professional.
When starting a business, you have to determine the method you are going to use for accounting and paying taxes. The two choices are the cash method and the accrual method. Cash MethodIf you are looking for simplicity, the cash method is probably your best accounting choice. Generally, income and deductions can be claimed when payment is actually received or made. This is best shown with an example. I open a small business and have to order business cards and stationary. I receive the products and pay the invoice on November 18, 2005. Under the cash method, I can deduct the cost on my 2005 tax return. Some businesses are restricted from using the cash method. C corporations may only use the cash method if they have less than $5 million in gross revenues for a particular year. Professional Service Corporations can use the cash method without limit, while farming corporations can due so if gross revenues are less than $25 million. Tax shelters are prohibited from using the cash method. Accrual MethodThe Accrual Method of accounting is a bit more complex. Under this method, the focus in on the date the expense is incurred, not paid. Although this may seem a small difference, it can play havoc with your books and piece of mind. Using our previous example, assume I order business cards and stationary on the December 18, 2005. I receive the products on December 30th, but don’t pay the invoice until January 20, 2006. When can the expense be claimed? It depends on when economic performance occurred. Generally, economic performance occurs when goods or services are provided to you. In the above example, economic performance would arguably occur when the business cards and stationary were delivered with the invoice on December 30th. Thus, I would be able to deduct the expense for the 2005 tax year. In ClosingAs you can see, the cash method is the easier of the two accounting methods. To determine the best method for your business, speak with a tax professional.
Business Laws: What you Need to Know
by: Matt Bacak
There are a myriad of things you must think about when opening any type of business whether it is a small business or a large corporation and one of those is how business law may affect you. Failure to pay attention to business and corporate law can land you in a world of trouble-both legal and financial. The good news is that you do not necessarily need to be a graduate of a fancy business law college or have a business law major to brush up on the basic ideas of small business law and corporate business law. If you've paid attention to the headlines lately, you probably know that employment law for business is one of the number one areas where you can get into trouble if you aren't up on all the employment laws and regulations. There are numerous laws that govern the employment of both regular employees and contract employees. Just for a broad overview, take a look at all the employment business laws you must meet: · Civil Rights Act of 1966.· The Equal Pay Act of 1963 · Americans with Disabilities Act· The Immigration Reform and Control Act of 1986 · The Age Discrimination in Employment Act· The Equal Employment Opportunity Act · The Bankruptcy Act · The Occupational Safety and Health Act · FMLA, the Family Medical Leave Act· Employee Polygraph Protection Act Labor Law· FLSA, the Fair Labor Standards ActAnd that's not even counting the various state employment business laws that might apply to your business! If you aren't sure of whether you are meeting all the regulations, it's a good idea to get a checkup for your HR department. Do you happen to work in the international arena? If you have anything at all to do with international business, then you should be aware of the many ways in which international business law can affect you, your business and your bottom line. At a minimum, you need to make sure that you meet general international business laws, specialized export laws, import laws and any laws of the foreign country in which your business operates. And what about the business law scene at home? Were you aware that in addition to Federal business law and international business law, you are probably required to meet State business law regulations? Do you know whether you need a business permit or license? Failure to obtain one can result in the shutdown of your business and hefty fines and penalties. This is just one of the ways that state business law, such as California business law, can affect the health of your business if you aren't careful to stay on top of things. Finally, what about Internet and online business laws? Were you even aware that there was such a thing? The Internet has exploded so much in the last decade that the government has found it necessary to institute Internet compliance laws. If you operate a website of any kind and do not meet the compliance regulations, that site could be shut down and you could face criminal prosecution and hefty fines. Of course, no one should ever attempt to navigate the complexities of any type of business law alone and the best course of action is to always seek the qualified professional advice of a business law firm, but hopefully these tips will help you to understand a little bit more about business law requirements. Summary: When operating a business, regardless of whether it is a small business or a large corporation, you need to be on top of business law compliance. Even if you hire a business law firm, it's still a good idea to understand what regulations you must meet.
There are a myriad of things you must think about when opening any type of business whether it is a small business or a large corporation and one of those is how business law may affect you. Failure to pay attention to business and corporate law can land you in a world of trouble-both legal and financial. The good news is that you do not necessarily need to be a graduate of a fancy business law college or have a business law major to brush up on the basic ideas of small business law and corporate business law. If you've paid attention to the headlines lately, you probably know that employment law for business is one of the number one areas where you can get into trouble if you aren't up on all the employment laws and regulations. There are numerous laws that govern the employment of both regular employees and contract employees. Just for a broad overview, take a look at all the employment business laws you must meet: · Civil Rights Act of 1966.· The Equal Pay Act of 1963 · Americans with Disabilities Act· The Immigration Reform and Control Act of 1986 · The Age Discrimination in Employment Act· The Equal Employment Opportunity Act · The Bankruptcy Act · The Occupational Safety and Health Act · FMLA, the Family Medical Leave Act· Employee Polygraph Protection Act Labor Law· FLSA, the Fair Labor Standards ActAnd that's not even counting the various state employment business laws that might apply to your business! If you aren't sure of whether you are meeting all the regulations, it's a good idea to get a checkup for your HR department. Do you happen to work in the international arena? If you have anything at all to do with international business, then you should be aware of the many ways in which international business law can affect you, your business and your bottom line. At a minimum, you need to make sure that you meet general international business laws, specialized export laws, import laws and any laws of the foreign country in which your business operates. And what about the business law scene at home? Were you aware that in addition to Federal business law and international business law, you are probably required to meet State business law regulations? Do you know whether you need a business permit or license? Failure to obtain one can result in the shutdown of your business and hefty fines and penalties. This is just one of the ways that state business law, such as California business law, can affect the health of your business if you aren't careful to stay on top of things. Finally, what about Internet and online business laws? Were you even aware that there was such a thing? The Internet has exploded so much in the last decade that the government has found it necessary to institute Internet compliance laws. If you operate a website of any kind and do not meet the compliance regulations, that site could be shut down and you could face criminal prosecution and hefty fines. Of course, no one should ever attempt to navigate the complexities of any type of business law alone and the best course of action is to always seek the qualified professional advice of a business law firm, but hopefully these tips will help you to understand a little bit more about business law requirements. Summary: When operating a business, regardless of whether it is a small business or a large corporation, you need to be on top of business law compliance. Even if you hire a business law firm, it's still a good idea to understand what regulations you must meet.
Outsourcing - Is it for my business?
by: Jakob Jelling
There are definitely advantages, but make sure you make an informed decision!There are a lot of advantages to outsourcing, however, there are also some disadvantages. Since this is such a huge issue, and such a large decision for you to make regarding your company, you should make sure that you take a good look at both sides of the issue before you make your decision. Make sure you know exactly what you stand to gain or lose by outsourcing your work.First of all, the advantages of outsourcing for your business are that you'll be able to get some of the less important jobs done for cheaper. For instance, if you're finding that you do not have enough money in your budget to make necessary changes in order to keep your business afloat, then you should probably find a way to reduce the amount of money that you're spending.Another advantage of outsourcing is that there are actually other companies and places where you can get the work done better than you are already in your own company. Not only that, but if you have a company that requires a large number of different products or services in order to function, it might take less time for you to find a good outsourcer than it would take you to train new people.There are a few disadvantages to outsourcing, however, and you should definitely take those into account as well. For one thing, if you outsource, it means that you're going to have to work very closely with the company that you outsource your work to. Otherwise, you won't get the finished work as soon as you need it. Having another company involved in your business might get tiresome after a while.Another thing that you should consider is that depending on where you outsource to, it might hurt your business. This is generally only a big deal if who your customers are really matters, or if you're a very small business. Some people shop at small businesses because they're local - and if you're a business like that, then outsourcing might be to your disadvantage.In the end, however, the question of whether or not outsourcing is right for your business can only be answered by you.
There are definitely advantages, but make sure you make an informed decision!There are a lot of advantages to outsourcing, however, there are also some disadvantages. Since this is such a huge issue, and such a large decision for you to make regarding your company, you should make sure that you take a good look at both sides of the issue before you make your decision. Make sure you know exactly what you stand to gain or lose by outsourcing your work.First of all, the advantages of outsourcing for your business are that you'll be able to get some of the less important jobs done for cheaper. For instance, if you're finding that you do not have enough money in your budget to make necessary changes in order to keep your business afloat, then you should probably find a way to reduce the amount of money that you're spending.Another advantage of outsourcing is that there are actually other companies and places where you can get the work done better than you are already in your own company. Not only that, but if you have a company that requires a large number of different products or services in order to function, it might take less time for you to find a good outsourcer than it would take you to train new people.There are a few disadvantages to outsourcing, however, and you should definitely take those into account as well. For one thing, if you outsource, it means that you're going to have to work very closely with the company that you outsource your work to. Otherwise, you won't get the finished work as soon as you need it. Having another company involved in your business might get tiresome after a while.Another thing that you should consider is that depending on where you outsource to, it might hurt your business. This is generally only a big deal if who your customers are really matters, or if you're a very small business. Some people shop at small businesses because they're local - and if you're a business like that, then outsourcing might be to your disadvantage.In the end, however, the question of whether or not outsourcing is right for your business can only be answered by you.
The Number One Reason For Business Failure!
by: Hans Hasselfors
Ralph Waldo Emerson said, "Build a better mousetrap, and the world will beat a path to your door." But when you're starting your own business, there's no guarantee that your "mousetrap" is going to survive, especially in today's fast-paced business world. Nearly half of all small businesses fail within the first two years of operation. The number one reason for business failure is inadequate planning. The second reason is under-capitalization. So before you mortgage your house, or go into debt financing your business, you need to know if your business is going to do more than survive -- you want to know if it's good enough to thrive! Here are three things successful businesses that have stayed in business for five years or longer have in common: 1. The idea. A successful business start-up always starts with an idea. Something that makes your business stand out from all the rest. So how do you know if you've got a good idea? You've probably got a good idea if you can answer yes to any of the following questions: Does your idea provide the solution to a significant problem for your target market? Does it satisfy a need or want? Does it create an opportunity? The most successful businesses either fix problems (either real or perceived), or they increase your customer's pleasure. They create a repeat need for a product or service among the target market. 2. The market. Your chances of survival are better if you can answer the following questions with a yes: Is there already a market for your product or service? (It's much easier to fill a need than trying to create an entirely new market.) Can your target market afford to buy your products or services? (If they can't afford it, it doesn't matter how great it is, you won't sell any!) Will your target market perceive your product or service as valuable? (If they want it, but don't think it's worth what you're selling it for, you won't make any sales.) 3. Your ability. Do you have the people, the resources and the knowledge to be able to consistently provide your products or services to your target market? Can you maintain a competitive advantage? Do you have enough manpower? Can you purchase the supplies and materials you need over the long run? Your first step always is to create a solid business plan. Your business plan is more than an essay on "Why I deserve to get funding for my idea" however. Don't spend all the time creating a business plan and then toss it in the bottom drawer of your desk. Your business plan should be a living, breathing roadmap that helps you make sure you're on course and reaching the goals that you set for your business. The second step to business survival is getting enough financing. Although the term "bootstrap entrepreneur" describes most small business owners, having enough capital to be able to keep your business afloat is vital to your survival. When you're creating your financial analysis of your business, make sure you're being realistic about costs and expenditures, so that you give yourself the cushion you need to succeed. If finding financing is a problem, either because you don't have enough credit or equity, or there are other problems, take the time to look into the resources that are available in your community. There are a wide variety of grants and loans (including microloans) for entrepreneurs, if you know where to look. Some great resources will be: -The Small Business Administration -Local Small Business Development Centers -Women's Organizations -Local University or Community College -Chamber of Commerce -SCORE (The Association for Retired Executives) -Nonprofit organizations that work on economic development in your area Use other successful business models as a guide. When you're getting started, look around. What businesses are successful? Why? What is it they're doing that is working? What attributes do you admire, and why? You stand a better chance of succeeding if you're modeling someone who is already successful. Find a mentor. Most entrepreneurs have great skills and abilities, but no one does everything well. You probably already know what your strengths and weaknesses are. (If not, there are many resources and tools that can help you figure it out!) Rather than ignoring your weaknesses, find a mentor who can help you either build your skills in your weaker areas, or offer advice for getting what you need. If you take the time to plan to succeed, you could be creating a legacy that will be enjoyed by future generations, and that other entrepreneurs will look at as a model for building their own businesses.
Ralph Waldo Emerson said, "Build a better mousetrap, and the world will beat a path to your door." But when you're starting your own business, there's no guarantee that your "mousetrap" is going to survive, especially in today's fast-paced business world. Nearly half of all small businesses fail within the first two years of operation. The number one reason for business failure is inadequate planning. The second reason is under-capitalization. So before you mortgage your house, or go into debt financing your business, you need to know if your business is going to do more than survive -- you want to know if it's good enough to thrive! Here are three things successful businesses that have stayed in business for five years or longer have in common: 1. The idea. A successful business start-up always starts with an idea. Something that makes your business stand out from all the rest. So how do you know if you've got a good idea? You've probably got a good idea if you can answer yes to any of the following questions: Does your idea provide the solution to a significant problem for your target market? Does it satisfy a need or want? Does it create an opportunity? The most successful businesses either fix problems (either real or perceived), or they increase your customer's pleasure. They create a repeat need for a product or service among the target market. 2. The market. Your chances of survival are better if you can answer the following questions with a yes: Is there already a market for your product or service? (It's much easier to fill a need than trying to create an entirely new market.) Can your target market afford to buy your products or services? (If they can't afford it, it doesn't matter how great it is, you won't sell any!) Will your target market perceive your product or service as valuable? (If they want it, but don't think it's worth what you're selling it for, you won't make any sales.) 3. Your ability. Do you have the people, the resources and the knowledge to be able to consistently provide your products or services to your target market? Can you maintain a competitive advantage? Do you have enough manpower? Can you purchase the supplies and materials you need over the long run? Your first step always is to create a solid business plan. Your business plan is more than an essay on "Why I deserve to get funding for my idea" however. Don't spend all the time creating a business plan and then toss it in the bottom drawer of your desk. Your business plan should be a living, breathing roadmap that helps you make sure you're on course and reaching the goals that you set for your business. The second step to business survival is getting enough financing. Although the term "bootstrap entrepreneur" describes most small business owners, having enough capital to be able to keep your business afloat is vital to your survival. When you're creating your financial analysis of your business, make sure you're being realistic about costs and expenditures, so that you give yourself the cushion you need to succeed. If finding financing is a problem, either because you don't have enough credit or equity, or there are other problems, take the time to look into the resources that are available in your community. There are a wide variety of grants and loans (including microloans) for entrepreneurs, if you know where to look. Some great resources will be: -The Small Business Administration -Local Small Business Development Centers -Women's Organizations -Local University or Community College -Chamber of Commerce -SCORE (The Association for Retired Executives) -Nonprofit organizations that work on economic development in your area Use other successful business models as a guide. When you're getting started, look around. What businesses are successful? Why? What is it they're doing that is working? What attributes do you admire, and why? You stand a better chance of succeeding if you're modeling someone who is already successful. Find a mentor. Most entrepreneurs have great skills and abilities, but no one does everything well. You probably already know what your strengths and weaknesses are. (If not, there are many resources and tools that can help you figure it out!) Rather than ignoring your weaknesses, find a mentor who can help you either build your skills in your weaker areas, or offer advice for getting what you need. If you take the time to plan to succeed, you could be creating a legacy that will be enjoyed by future generations, and that other entrepreneurs will look at as a model for building their own businesses.
9 things you must do to maximize your chances of obtaining a small business loan
by: Neil Best
To get approval for your small business loan application, you must be able to meet the lending criteria set down. Some organisations are more risk averse than others, and will therefore have more stringent criteria. To vastly increase your chances of a successful funding application, you will need to present the following information: 1. The reason for the loan. The lender will be looking for something that fits within the normal range and expertise of your business. The amount may cover a number of items, so you will need to cover each. 2. The amount required, and the repayment term of the small business loan you want. (e.g. $10,000 term 5 years, payable quarterly). 3. Details of how you will repay the amount borrowed. For example, “From the increase in profits of reduced running costs of the Whizzbang Go4It” 4. Details of security you will be able to offer to the lender. This will act as reassurance for the lender. If you’re not prepared to put up some aspect of security, then why should they? 5. You will need to include your business plan which will serve to answer essential questions relating to management capabilities, information about the market you operate in. What kind of business you are in etc. 6. 3 Years financial statements. You will need to present quality financial information from your accounting software, preferably signed off by your accountant or tax advisor. 7. Latest Set of Management accounts. Again produced from your accounting software. 8. Accounts receivables (debtors) and payables (creditors) ageing reports. 9. Principals financial statements. – Particularly required if some form of security is necessary. If you are a new company, the emphasis is going to be on your business plan , and the security (also called collateral) you or your business can provide against the loan. You must take the time to practice presenting your case to the bank or lender to iron out any glitches. Practice on your colleagues and family (you never know, they might be so impressed, they'll invest or lend!). It may help to role play the lender and come up with as many pointy questions as possible. The more time you take the better your chances will be. (But remember, don’t fall into the analysis paralysis trap!) Good luck!
To get approval for your small business loan application, you must be able to meet the lending criteria set down. Some organisations are more risk averse than others, and will therefore have more stringent criteria. To vastly increase your chances of a successful funding application, you will need to present the following information: 1. The reason for the loan. The lender will be looking for something that fits within the normal range and expertise of your business. The amount may cover a number of items, so you will need to cover each. 2. The amount required, and the repayment term of the small business loan you want. (e.g. $10,000 term 5 years, payable quarterly). 3. Details of how you will repay the amount borrowed. For example, “From the increase in profits of reduced running costs of the Whizzbang Go4It” 4. Details of security you will be able to offer to the lender. This will act as reassurance for the lender. If you’re not prepared to put up some aspect of security, then why should they? 5. You will need to include your business plan which will serve to answer essential questions relating to management capabilities, information about the market you operate in. What kind of business you are in etc. 6. 3 Years financial statements. You will need to present quality financial information from your accounting software, preferably signed off by your accountant or tax advisor. 7. Latest Set of Management accounts. Again produced from your accounting software. 8. Accounts receivables (debtors) and payables (creditors) ageing reports. 9. Principals financial statements. – Particularly required if some form of security is necessary. If you are a new company, the emphasis is going to be on your business plan , and the security (also called collateral) you or your business can provide against the loan. You must take the time to practice presenting your case to the bank or lender to iron out any glitches. Practice on your colleagues and family (you never know, they might be so impressed, they'll invest or lend!). It may help to role play the lender and come up with as many pointy questions as possible. The more time you take the better your chances will be. (But remember, don’t fall into the analysis paralysis trap!) Good luck!
Protect Your Business by Performing a Background Check
by: Bruce Zhang
The success of a business endeavor involves a concerted efforts of financing, strategic planning, product design or service positioning, marketing, sales, and customer support. One of most important aspects of doing business is the people you deal with everyday - your employees, your partners and your competitors. Whether you are a small business owner or a human resource manager of a large corporation, you want to make sure that you hire responsible employees, you deal with trustful partners, and you may even want to learn more about your competitors. It is a routine for corporations to perform background checks on their hiring prospects before they make a hiring decision. Background checks reveal more information than that you gain from resumes or face-to-face interviews. For some jobs, screening is required by federal or state law. Job applicants and current employees may be asked to submit to background checks. The recent emphasis on security has increased that likelihood.Contractor fraud is at an all time high. Background checks help businesses to verify the identify and license of potential contractors. Contractor complaint search shields the lights on the reputations of the contractors you're dealing with.1. What can you get from a background check report?A background check report aggregates public records from many sources created by government agencies. Besides verifying the identify of an individual, a report usually includes: vehicle registration, credit records, criminal records, education records, court records, medical records, military records, state licensing records, and drug test records.2. Who Conducts Background Checks?There are many companies that specialize in employment background checks or pre-employment screening. Those companies range from employment screening companies to online data brokers. While an employment screening company may offer detailed and customized background checks at a premium, you can get instant background check reports from an online background check website at a much lower price. Large corporations often contract out the background checks to an employee screening company. Small business are likely utilize an online data brokers to get fast reports.Copyright @2005, Bruce ZhangYou have permission to publish this article electronically free of charge, as long as the bylines and links in the body of the article and the bylines are included
The success of a business endeavor involves a concerted efforts of financing, strategic planning, product design or service positioning, marketing, sales, and customer support. One of most important aspects of doing business is the people you deal with everyday - your employees, your partners and your competitors. Whether you are a small business owner or a human resource manager of a large corporation, you want to make sure that you hire responsible employees, you deal with trustful partners, and you may even want to learn more about your competitors. It is a routine for corporations to perform background checks on their hiring prospects before they make a hiring decision. Background checks reveal more information than that you gain from resumes or face-to-face interviews. For some jobs, screening is required by federal or state law. Job applicants and current employees may be asked to submit to background checks. The recent emphasis on security has increased that likelihood.Contractor fraud is at an all time high. Background checks help businesses to verify the identify and license of potential contractors. Contractor complaint search shields the lights on the reputations of the contractors you're dealing with.1. What can you get from a background check report?A background check report aggregates public records from many sources created by government agencies. Besides verifying the identify of an individual, a report usually includes: vehicle registration, credit records, criminal records, education records, court records, medical records, military records, state licensing records, and drug test records.2. Who Conducts Background Checks?There are many companies that specialize in employment background checks or pre-employment screening. Those companies range from employment screening companies to online data brokers. While an employment screening company may offer detailed and customized background checks at a premium, you can get instant background check reports from an online background check website at a much lower price. Large corporations often contract out the background checks to an employee screening company. Small business are likely utilize an online data brokers to get fast reports.Copyright @2005, Bruce ZhangYou have permission to publish this article electronically free of charge, as long as the bylines and links in the body of the article and the bylines are included
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