Small Business

I Am Exremely Sorry for not Posting!

2010-02-19T22:12:00.003-07:00

As you know it is tax season! I am really over occupied at this time to get my clients the best deductions. As a great accountant I can assure you that my clients really count on me at this time of the year!

In addition to all of this, I am trying to run http://tweeterstoreontwitter.com, http://beauti-you.com, and now http://greatdealscanada.com and their associated twitter accounts!

I do this myself! It sometimes gets hard to leave what I am doing, but after hearing so much positive feedback about this blog - know that I will soon return! I do not let anyone down. Please in the meantime read through our great articles at the right of the blog! Will be back soon! ~Brad

Disaster Preparedness in a Post 9/11 World

2010-01-22T07:22:00.000-07:00

So much has changed in the last several years after 9/11, and yet most businesses are still inadequately prepared for disastrous situations. Not only are they vulnerable from the threat of terrorism, but from security and natural disaster standpoints as well. While a terrorist act poses a substantial threat to business operations; data loss, internal and external theft, floods and fires can be just as harmful. Unfortunately, of the few businesses that have some semblance of a disaster preparedness plan, there is still little consideration given to business continuity management. When disasters happen, not only do businesses need to be prepared to immediately offset the effects of the detrimental event, they must do so while maintaining core operating functions. Disaster preparedness without continuity management can be likened to fortifying a strategic position without a progressive plan of action. What can make things more complicated is the tendency for businesses to implement a disaster preparedness plan without fully considering the consequences.

A good disaster preparedness plan shouldn't hinder a businesses ability to continue functioning. Initiating a disaster preparedness plan that will protect the interests of the business should be an all inclusive affair, with due diligence given not only to limiting damage from the situation at hand, but to keeping operational status. Given the uncertainties faced by businesses in the post 9/11 world, continuity management can often mean the difference between success in the face of adversity or a complete loss of business. So often, companies take steps to limit their loss liability, but rarely consider the fact that most loss liability can be avoided altogether with the proper safeguards in place. A well thought out business continuity management plan, which should include a contingency centered around disaster preparedness, can prove triumphant in the face of what would otherwise be considered tragedy. As the old saying goes, "An ounce of prevention is worth a pound of cure".

What are the Most Common Ways to Commit Identity Theft or Fraud

2009-12-15T06:22:00.001-07:00

It's the number one source of consumer complaints at the Federal Trade Commission (FTC), and unfortunately, it's one of the simplest crimes to commit. Identity theft involves information from your daily life, from shopping, bill-paying, and even applying for a job. Thieves take advantage of everyday opportunities to discover your personal information, including your Social Security number (SSN), bank or credit card account numbers, income, name, address, or phone number, and use it to commit fraud or other crimes.

How can a stranger get to your information? According to the FTC, identity thieves may pose as legitimate representatives of an organization, as business professionals or agents of the government, conning you into revealing sensitive information. Common scams include impersonating employees from banks, credit card companies, Internet service providers, and utility companies. If someone calls you claiming to represent a legitimate organization, confirm this by calling the customer service number listed on your statement or bill.

Thieves may also use your place of employment to get the information they need. A co-worker may steal information from your employer; someone could hack into your company's computer and copy employee records; or a criminal could resort to the old-fashioned method of bribing someone you work with for your information. Check with your employer to find out the company policy on securing your records and disposing of them when you're gone.

If your employer is authorized to pull credit reports on employees or potential customers, someone could take advantage of this access to retrieve illegal reports. Criminals may also pose as employers, landlords, or collection agents to pull your credit information. It's a good idea to order a copy of your credit report once a year to check for unauthorized entries.

Shredding your documents before you throw them away is also good idea, whether at work or at home. Identity thieves have been known to sift through garbage, in the trash can or at the dump, to find sensitive information.

The most common form of identity theft is credit card fraud. Technology has allowed criminals to begin stealing your credit or debit card numbers as you use the cards, "skimming" them with an information storage device. In addition, thousands of drivers' licenses and credit and debit cards are stolen each year. Keeping your Social Security card in a secure location and safeguarding your purse or wallet while at work are necessary precautions.

Even your mail is a source for identity thieves, who may complete credit card applications in your name and go on a spending spree. After stealing your bank or credit card statements, tax information, or box of replacement checks, criminals are able to access your accounts and spend the funds in your name. They may even change the address on your existing account, diverting the bills to keep you from recognizing the problem until it's too late. Being aware of your billing cycles can help you catch a discrepancy in the arrival of your statements.

Identity thieves have a variety of ways to use your information for their personal gain. They may shop for big-ticket items using your credit or bank account information and then sell the items for cash. With your SSN and date of birth, they can open new bank accounts or apply for lines of credit. In fact, banks have granted loans to criminals using stolen identities for purchases as large as cars.

Telephone or internet service can be set up using your SSN. Thieves can avoid impending eviction or accumulated debt by filing bankruptcy in your name. Perhaps the most emotionally traumatic, police could issue a warrant for you if a criminal was arrested using your name and failed to appear at a court hearing.

The ways that identity thieves have conceived to acquire your personal information are numerous, but your vigilance and heightened awareness can curb their ability to make you a victim. And, if you sustain credit damage, go to http://www.apscreen.com to find out what you can do about it.

What Goes Behind Your Credit Score?

2009-11-25T06:29:00.002-07:00

A credit score is primarily based on credit report information, typically from one of the three major credit bureaus, Experian, TransUnion and Equifax. Since lenders or banks lend only against your creditworthiness, it does makes sense for you to know what factors determine your credit score.

What Is A Credit Score?
Based on the snapshots of your credit report, credit score is the number arrived to summarize your credit risk. It ranges from 300 to 850 and helps a lender to determine the risk level. Or we can put it like this, “if I give this person a loan, how likely is it that I will get paid on time?”

There are different methods of calculating credit scores. FICO is one of the most popular credit scores developed by Fair Isaac & Co. The higher is the FICO score the lower is the risk for lender.

What Affects Credit Score?
Your credit reports contains many pieces of information that reveals certain important aspects of your borrowing activities mainly focusing on:

• Late payments
• The amount of time credit has been established
• The amount of credit used versus the amount of credit available
• Length of time at present residence
• Negative credit information such as bankruptcies, charge-offs, collections, etc.

Bad Credit Small Business Loans
Seeking loans with low or bad credit score can drive you up the wall. The mainline lenders may simply reject your loan application while the others from subprime market may charge you extortionate rate of interest on your bad credit small business loan.

In case you are an entrepreneur and need new business loan for growth or expansion, bad credit can put you in pickles. In such a scenario, it’s better to go for cash advance option that is provided irrespective of you credit history. Such cash advance is given against your future credit and debit card sales.

What Is Cash Advance Option?
Cash advance is a small business loan approved against the monthly amount you process through credit card sales. Cash advance lenders do not ask you for your credit rating and can pre-approve your loan within 24 hours. A mutually agreed upon percentage from your daily sales through credit card processing goes to the lender automatically as repayment of the loan.

How To Increase Your Credit Score?
Your credit score cannot be improved in short run but a few steps can help you improving your credit rating over a period of time. Here are a few tips:

• Pay your bills on time. Late payments and collections can have a serious impact on your score.
• Do not apply for credit frequently. Having a large number of inquiries on your credit report can worsen your score.
• Reduce your credit-card balances. If you are "maxed" out on your credit cards, this will affect your credit score negatively.
• If you have limited credit, obtain additional credit. Not having sufficient credit can negatively impact your score.

What Are the 7 Proven Principles of Business Success?

2009-11-04T06:26:00.000-07:00

The 7 Proven Principles to Business Success will overcome whatever limitation you have. Think of it as a recipe for success in business. All you have to do is first of all learn what the 7 principles are, and then apply them, in order. When you follow this recipe all of your challenges will fade away.

Why do you own a business? Isn't it because you want a LIFESTYLE? You didn't intend to work long hours, be stressed, have little time off and be hassled with staff and customers did you?

Isn't it time you made some changes for the better? After all, if you want to change some things in your life, you have to change some things in your life. If you're ready for a change here's the magic recipe you need to follow...

Principle 1: Work on yourself to understand people.
Business is all about people isn't it? You have them as customers, you employ them, but few people have realised the absolute key to success is understanding people at a much, much higher level. You sales and marketing skills are determined by what you know about people. Your leadership skills with your staff to get them to perform as well as you do is determined by your knowledge on people.

So what's the best way to learn about other people? Easy, learn about yourself! You're a people and the more you learn about yourself the more you automatically learn about other people.

Principle 2: Learn business success principles.
There are so many principles to business success, but I'll emphasise just a few. One is, you're in business to make a profit, not just turnover. Turnover is a job, whereas profit gives you a LIFESTYLE. Your aim should be to increase your net profit percentage of turnover, as this allows you to grow and pay yourself whatever you desire.

Net Profit percentage comes from improving everything you do, not just doing more of what you already do. How you answer the phone, how you greet people face to face, how you write your ads, improving your communication and leadership with your staff. All of these are areas to improve.

Another principle of business success is cash flow. Cash flow means having the cash in your bank account that should be in your bank account. If customers cost you money before you get any back, that's negative cash flow, if you get cash before you incur a cost that's positive cash flow. The better you get at getting money up front with deposits and getting people to pay on time the better your cash flow.

Principle 3: Set goals and have a plan to achieve them. Until you set a goal you don't have a reason WHY you will improve your business, therefore the HOW doesn't matter. People have to know why, before how. You'll want to know how to grow your business once you have set a written goal.

When you have a goal its time to look at the relevant strategies for your business. I know of over 300 strategies, but most people can only think of about a dozen. Strategies are like tools. If you go to build a house with just a hammer, a saw and nails you will be building it for a long time. Business is the same. When people don't know what strategies are available or suitable to them how can they effectively grow their business?

A Business Growth Plan is simply the order of implementation of those strategies beginning with the highest priority strategy. When you have documented goals for 3, 6, 9, 12 and 24 months with a list of strategies in order you have a Business Growth Plan that makes growing your business EASY!

Principle 4: Turn your staff into a TEAM.
Unfortunately business owners are trying to do it all on their own. They often don't train their team regularly with team meetings or one on one allocated time every week. I believe you have one role as a business owner, to be a great teacher! Your aim should be to teach everyone in your business how to do everything you currently do, better than you do! And what does that then make you? Obselete! When business owners think no one can do my job as good as me, they are digging a big hole for themselves they will never get out of. Then they wonder why they are stressed, tired, work long hours and this happens more and more as the business grows. TEAM stands for Training Everyone Achieves More!

Principle 5: Build foundations for growth.
If you want to build your business to provide a great lifestyle you need to put foundations in, just like building any building. If you don't intend to really increase your profits then you don't need foundations. If you want to seriously increase your net profit percentage (even without increasing turnover) you must have strong foundations. When they build a skyscraper they don't build up, they dig a big hole down.

The foundations in business are 2 things. First, having documented systems. A system is just a best way of doing something that everyone knows and uses that has been identified and written down. It helps consistency and efficiency and as you grow people are accountable to the systems, not to you the owner. That means you save time checking on everyone. Systems only work when you have worked with your staff to turn them into a TEAM.

Secondly, measuring everything is part of building foundations. If you haven't measured your Key Performance Indicators how will you improve on them? Increasing Net Profit percentage of turnover comes from improving everything you currently do, remember?

One could write a book on measuring, it’s so important, I can't emphasise it enough. When you've measured all your KPI's you're ready for...

Principle 6: Implement EFFECTIVE Sales and Marketing.
Everyone in business is already doing sales and marketing but how effective is it? You know when you have effective sales and marketing, here's how: you won't get so many price shoppers as your marketing already has "sold" them on buying from you. Your marketing is so effective you only have to run it a third as much because you can't handle the increase in customers it brings you. And you'll know your sales and marketing is effective because you put your prices up 20% and also increase your conversion with the price rise!

People in business don't take responsibility for their sales and marketing and as a result they don't get the results they desire. If you learn sales and marketing by paying a professional for a few months it will be the best investment you ever make. Once you learn the principles of success you can then add to them yourself, but often you need an expert to get you started.

Principles 7: Manage the business.
Unfortunately businesses aren't managed at all well. You can tell by these examples... decisions aren't based on numbers, there aren't documented systems, regular weekly team meetings aren't happening nor is weekly one on one team training.

Management is all of the above; it's making decisions on numbers. e.g. you measure how many customers you serve in a week for each team member and measure the number of new customers each week and then work out your team can service 5 customers each per week. That means if your marketing can produce 5 new customers and if you're at maximum service capacity you need to be thinking about getting a new team member very soon.

This is what management is, training your team weekly, documenting systems, measuring numbers, making decisions on numbers, setting goals and helping your team to achieve their own.

When you dedicate time to learn and then follow all 7 Principles, in the order above anything is possible. I've had clients increase their monthly turnover by 1,000% in just 5 months when the business wasn't growing at all and the owners did it with ease and grace, no stress at all!

What's your growth potential? Are you realizing it yet? If you're not growing at 50%-100% a year you're possibly not growing as fast as you could!

Incorporating Tips – Capitalization

2009-10-21T06:13:00.000-06:00

Capitalizing a new business entity is a critical step of the formation process. Failing to take the step can lead to serious legal problems if the entity is ever sued. So, what is capitalization and what steps must be taken?

Capitalizing Your Corporation

“Capitalization” essentially refers to funding your corporation. In essence, you are providing substance to the entity in the form of money or property. Typically, the funding process works in two ways.

Corporate Stock

You must own stock in a corporation to be considered a shareholder. You are already familiar with this concept if you trade on the stock market. For instance, assume you bought stock in Sirius Radio in anticipation of Howard Stern moving to the station. You purchased stock through a brokerage or retirement vehicle by exchanging money for shares. Technically, you are a shareholder in the corporation. Your own corporation is no different.

The fact that you paid money to have a corporation formed does not make you a shareholder. You must exchange property, cash or services to obtain stock from the entity. Only then are you a shareholder in the entity. This is more easily explained with an example.

Assume I start a corporation for the purpose of providing consulting services to other businesses. The corporation is formed with 10,000 shares and I am going to be the sole shareholder. I have cash and certain assets that I am going to use as part of the business. I decide to exchange $3,000, a copier, fax machine and computer equipment for stock in the entity. This exchange should be reduced to writing, but will constitute the capitalization of the corporation.

Corporate Loan

You can also loan money to a corporate entity for start-up costs. There is no prohibition against a shareholder providing money to a corporation. The loan process should not completely replace the purchase of stock. From a tax perspective, however, dividing your initial capitalization into a partial loan can have distinct advantages.

Inadequate Capitalization

State laws govern the formation of a corporation. Inevitably, these laws set forth amounts or formulas for determining the minimum capitalization amount required for a corporation. You must review the laws in your state to determine the amount and make sure you meet the contribution minimums.

Failure to properly capitalize your corporation can result in disaster if the entity is ever sued. Simply put, the suing party may argue that the lack of capitalization means the corporation was never a viable entity because it had insufficient funds to back debt obligations. The argument gets complicated, but suffice to say you are in serious trouble if a court agrees with the argument. Typically, the court will “set aside” the corporate entity, exposing each shareholder, director and officer to the risk of personal liability. Obviously, such a scenario would be a disaster.

In Closing

If you’ve purchased a corporation from online service, you have work to do. Make sure you determine the minimum capitalization requirements in your state and comply with them.

Who Needs a Business Advisor?

2009-10-08T06:54:00.000-06:00

The simple answer to the seemingly complex question of “Who needs a business advisor?” is … everyone responsible for operating a business. That’s right. The Fortune 50 CEO to the one-person show needs an advisor.

The CEO of a public company has mentors as well as a board of directors to turn to. They often don’t have a choice of who their advisors are but small business owners do. Unfortunately, with this choice of advisors comes another choice that is often made instead. That choice is to not get any help at all.

Not getting any help at all is very often the cause of the business failure statistics we hear so much about. The small business owner will often claim that they don’t have the time or money for an advisor. Think about that comment. How can you not have the money to get help from someone that can potentially save or make you more money since you obviously are not getting it done on your own? Or how about that time you are lacking? Maybe if that owner sat down for an hour with an advisor, they would be able to see why they don’t have time and do something about it with the help of someone who has already been in those shoes.

A coach or advisor gives to small business owners something most of them don’t have; a sounding board and a board of directors to turn to for advice. These are two great resources to use when trying to avoid “trial and error” decisions and processes.

I’m not knocking trial and error as the way to learn things. I’ve personally used that method and faired well in many cases. But that is a case-by-case basis, not for on-going daily concerns. Don’t forget that this method is also very costly and time consuming. Why not ask someone who has probably already faced the problem?

What many business owners do not realize is that they rarely go through any trials and tribulations that someone else has never dealt with. Not to mention that about 70-75% of their business is the same as every other business including HR, finances, sales, marketing and funding. The other 25-30% is industry specific.

Small to mid sized business owners take away much more from an advisor than big businesses. This, if for no other reason, is the case because the smaller companies have owners that wear a lot of hats. Many of those hats take time away from the things the owner actually needs to make a priority to see their company succeed. Things they should be doing that they don’t have time to get to or things they are taking care of that they have no experience in doing. These situations take away from them doing what they do best. That’s a problem.

The question now is how to find an advisor. There are many types of business advisors out there. Some are purely “coaches” and others are true developers and implementers that will roll up their sleeves with you when asked to. It’s up to you to pick the type of person you want or need. Here are a few things to think about:

- Do they click with your personality? There are many good advisors out there but if they don’t click with you as a “business friend”, don’t bother with them because you will end up fighting them even when you agree on the advice.

- Have they owned a small business before? Gray hair does not equal business ownership knowledge. I promise you that the ex-CEO or Senior manager from a huge company knows very little about successfully operating a small business. These are two significantly different worlds.

- Don’t worry if a potential advisor doesn’t know your specific industry. Remember that a lot of your troubles have nothing to do with your industry. It would help though if the advisor had contacts/resources for you in your industry for when specific problems are addressed.

- Look for flexibility. A potential advisor that pushes for more than 20 hours a month of your time from day one is probably out for money. Until they start working with you, there is no way of knowing that they need that much time per month to meet your goals and timelines. A good advisor will understand that you have made a commitment to get back on track just by the fact that you are talking to them. They shouldn’t need to try and get a ridiculous time/money commitment from you if they want to help.

- Make it a local thing. This suggestion is a two-part issue. First, the advisor should agree that when face time is needed that they come to you. Second, there is absolutely no reason why a small business with locations in one state needs a business advisor that must fly in or travel more than 2 hours to see them. These companies somehow find suckers to take their so-so advice and huge reports full of fluff and also pay for travel costs. There are plenty of advisors local to every company in this country. Yes, even in Hawaii.

Once you made the very intelligent decision of getting help in making your business a success, keep a few things in mind. You should really commit to working with your advisor for a good 6 months. Nothing gets fixed overnight. Also, since you are paying for it, please do yourself a favor and be open to suggestions, bring important things to your advisor for help in making a decision and make the use of your time with the advisor a priority. Don’t forget that an advisor or coach should never make a decision for you. It’s your company, they are there to make suggestions and guide you.

Working with an advisor can be a very enlightening experience. You will start to see the forest from the trees and not feel like you are the only person on the planet going through tough times as a business owner.

All business owners eventually need help. The successful ones put aside their pride and desire to be at the center of all aspects of the company and get the help. Do yourself and your company a favor and be one of the truly successful business owners. Get an advisor and get all you can out of them. If your advisor loves what he/she does for a living as such as you love what you do, you can’t go wrong.

Common Mistakes Small Businesses Make and How to Avoid Them

2009-09-25T07:07:00.001-06:00

Unfortunately very few start up businesses make it beyond their 3rd year. Failure is usually down to a number of clearly identifiable mistakes, which if small business owners are aware of, can increase their chances of survival.

Here are the top 10 common mistakes which small businesses tend to make.

Lack of Market Research

When a budding entrepreneur comes up with an idea for a new business he assumes that because he would buy such a product or service then everyone else will. This may be the case for day-to-day necessities but for other items this is usually not so.

It’s important that when you start up you carefully research the market to check that:

• There is demand at a level which would lead to a sustainable business

• People are prepared to pay the price required for you to make a decent profit

Undertaking market research may appear time consuming but the effort will pay off.

Poor Record Keeping

Some business people are not born administrators; they feel more comfortable getting out there and ‘doing the business’. paperwork is too easy to ignore but can never be put off indefinitely.

Sales, purchases and other expenditure must be carefully documented, so you know whether you are making a profit or not. Invoices must be issued on time and chased up promptly if there is a delay in payment. It’s all very well having the sales but poor record keeping can hold you back.

Having your paperwork in order will also save you time when it comes to your accountant doing your year-end books!

Insufficient Capital

When starting off it’s easy to decide what capital is required for fixtures and fittings, machinery and stock. What many new business owners forget about is the cash needed to fund day-to-day requirements, i.e. cash to pay expenses before your customers pay you. This is known as your working capital requirement.

Small businesses can fail because they have insufficient cash to start off to meet these immediate expenses. If you wish to survive make sure you set aside enough cash to meet all your needs for the first few months.

Ineffective Marketing Or None At All

You cannot afford to treat the cost of marketing as an unnecessary expense. A business with no marketing is like waving in the dark – you know you are doing it but no one else does!

There are many ways to promote your business on a small budget; it’s just a case of being inventive and creative. What ever you do, don’t assume that people will quickly know you are in business – they won’t, unless you tell them.

Ignoring Changes In The Market Place

As a small business owner it’s very easy to get immersed in your business and not see what is happening around you in the market place. Always keep your eyes and ears open to what the competition is doing and what your customers want. Don’t get left behind.

Owner’s Attitude

Attitude is everything in business. Don’t forget that the real boss in your business is the customer. Running a business may make you feel important but don’t let this develop into an ‘I am better than you’ attitude. Do this and you will quickly chase your customers away.

Spending On The Wrong Things

Being in business can be exciting, especially as the cash starts to roll in! However, don’t be tempted to spend it on a new car, a house or just a good time. If you are to own a successful business then you have to keep some cash back to fund future growth. A business cannot grow without cash, so commit to spending business money on the business.

Dependent On A Small Number Of Customers

Don’t fall into the trap of setting up a business just because one person says they will buy from you every week or month. Setting up and running a business, which is dependent on one customer, is not a recipe for success. What happens if, one month after you have spent all your cash to set up your business, that customer says he has changed his mind and has decided to buy elsewhere? Unless you can find other customers very quickly you are faced with closure.

Before embarking on a new venture make sure you have a sufficient number of customers such that if a few go elsewhere you can still continue trading.

Growing Too Quickly

Surprisingly, growing too quickly can be a problem. You have to be disciplined enough to only take on work you can handle. If you are tempted to accept too much you could end up disappointing not only the new client but also your existing ones.

Also, don’t under-estimate the impact rapid growth can have your administrative burden. As I mentioned earlier, getting behind on the paperwork can have an equally damaging effect on your business.

Trying To Do Everything

Finally, the problem most small business owners have is the fact that everything falls on their plate. Inevitably this is how it’s likely to be in the beginning, when the limited budget means that staff are a luxury, but as the business grows be aware that you cannot continue to do all tasks. There will come a point when you become inefficient and not have enough time to complete everything in sufficient detail. Taking on an extra pair of hands will increase your costs but you will be surprised at how much time will be saved, allowing you to do what you do best – getting the business in.

Take a look at each of the mistakes and make sure that you don’t fall into these traps.

Will Your Small Business Have A Happy Ending?

2009-09-17T07:03:00.000-06:00

There is no question that as a small business owner you have persevered and worked hard, dedicating your life to the success of your company. That being said, don’t you think a company you put all of your energies into, deserves the chance at having a happy ending? Have you considered the impact your death, disability, retirement, or even divorce could have on your small business?

If you are the owner of a small business it is time for you to stop thinking of only what is happening now, and start focusing on what could happen in the future. Therefore, you need to put your priorities into perspective by protecting yourself and your business with a succession plan. A business succession plan is what you need to ensure that your business has a happy ending by remaining secure, regardless of what may happen in the future.

In particular, a succession plan allows your business the chance to be able to stand up to any challenges that may occur along the way. For instance, certain setbacks that you might experience may be entirely beyond your control such as divorce, disability, departure and death. But with a business succession plan you have the chance, as a small business owner, to ensure that regardless of what may happen to you, your business will be protected.

The following are a few aspects you should to take into consideration when creating a business succession plan for you small business:

How to Begin the Succession Planning - Since you need to make choices before you can really begin achieving your succession planning goal, you must first think about your long term business objectives and ask yourself important questions such as –

• Will I sell my small business?
• Should I set up a plan that allows me to transfer my business to one of my business associates or a family member?
• Does my business have public potential?

Of course, business succession planning begins with much more than simply deciding who you will be giving your business to in the event that you can no longer run your company, or wish to sell it. Additionally, succession planning is about keeping your small business afloat and successful to ensure that your absence will not devastate your company. Therefore, in order to maintain future control of your business, you will need to begin your succession planning by making choices that will concern things such as:

• ownership objectives
• asset protection planning
• taxation and transaction planning
• estate planning

You will want to keep in mind, however, that due to the fact that every action you take with succession planning will result in a reaction, you will require the assistance of experienced experts when developing your plan.

Understand the Dollars and “Sense” of Business Succession Planning – Like any type of business preparation, your business succession plan needs to be orderly and handled carefully if you don’t want to suffer the consequences of financial losses – or worse – the loss of your small business. That being the case, you need to know exactly what you are dealing with, and how you can achieve the most of your planning.

The one mistake you will not want to make is to overlook your business finances. You can help keep your business secure by properly using the following, and more, in your succession planning before problems occur:

• Life insurance
• Disability insurance
• Annuities

Furthermore, you will find that with an orderly succession plan, you will be avoiding the possibility of your business having to be sold to pay off the estate tax, in the event of yours or (if you have one) your partner’s death. It is no secret that estate taxes can claim up to 55% of an estate that is taxable, which is no mystery why so many businesses fall into debt, become bankrupt, or are sold due to the death of the owner or partner.

In addition, another aspect that needs to be considered is that clients are most likely to do business with other businesses after the owner or partner is deceased. However with the proper succession plan, your business should be able to maintain any regular clients - or if not - it will be better equipped to survive the possible drop in assets if a slow period should follow.

Know How to Write Your Happy Ending – Remember, when all is said and done, the outcome of your succession plan depends entirely on the choices you make regarding the future of your small business. It is imperative that you take the time to make the best choices that will allow you to implement a succession plan, which keeps you in control of the outcome that involves the transfer of your company. By knowing how to ensure the prosperity of your business future with a succession plan, is how you will write your happy ending.

Unsecured Start Up Loans For Small Business – Is It A Good Idea?

2009-09-09T08:13:00.000-06:00

First-time small business owners usually are chary of unsecured start up loans. This is because the time frame for making a profit is not definite whether or not there is a properly thought out and lucrative business plan in place for the future business.

When profits or revenues do not materialize per plans, as in most cases, there is danger of default on loan repayment. When this happens credit rating of the person involved gets degraded as unsecured loans are granted on the basis of credit and borrowing history of the business owner.

And if there is bad credit history behind, he/she can very well forget that small business loan. Let’s discuss some more aspects of unsecured small business start up loans.

Some Facts

If the credit history of ‘to be’ small business owner is good, unsecured start-up business loans are easier to avail as compared to other business loans. But it is better to go for secured loans against property or equipment affiliated with the business.

Secured loan not only keeps personal credit rating intact but poses lesser risks for the business owners, because they can use the hypothecated equipment to generate a profit for the business. As a result the loan can be paid back on time. Not just that, secured loans are for longer tenure and come with lesser interest rate burden, thereby lowering the cost of loan.

But if you have decided to apply for unsecured small business start-up loans, you should be careful about the requested amount. Remember, the more you owe on the loan (including interest), the more will be the money which you have to repay.

If you are not exactly sure how well the business will do in the first year and want to keep your credit rating good, it is best to request a small amount for your unsecured start-up business loan. This will make sure that repayment installments are small and if you are punctual in repaying, you can always ask for more, which will be gladly given.

Some Advice

Before you apply for an unsecured business start-up loan, there are several things that you should keep in mind.

First of all, you will need to convince the lender that it is a good decision to issue the loan to you. Since unsecured loans are based on your credit and repayment history, you will have to convince lenders that you can handle your personal finances in an organized fashion. Good credit record will put lenders at ease since they will be able to see your repayment history on your credit report.

Since lenders will be looking at your credit report, you should maintain a positive report as far as possible. If you know that you owe certain lenders, you should try to settle these debts or set up a payment plan with your creditors. This will be visible on your report.

Before you make any final decisions about unsecured start-up loans for business, be sure to speak to an accountant or a representative from your local bank. This will make sure that you are applying for the right loans which would help your business to develop quickly and steadily. You must not take a decision unless you are convinced.

Set Up Your Online Business for Less

2009-09-01T07:38:00.001-06:00

Are you starting an online business with a small budget? That's OK. Online businesses are one of the lowest cost businesses to run - if you know what you need to pay for and where to go.

Follow these suggestions for getting your website set up inexpensively while not sacrificing quality. There are some things you need to pay for (and this will tell you how much) and other things you can do just as well for free.

STEP ONE: GETTING A DOMAIN NAME

There's no reason to pay more than $10 - $15 for a domain name, so feel free to shop around. Domains are important because they give you credibility as a business.

Free websites do not enable you to have your own domain name so instead you end up with mybusiness.freespace.com instead of mybusiness.com. See the difference? Your customers expect you to put some money into your business and this is a clear tip off that you are not doing that - and for $10 - $15, why shouldn't you?

STEP TWO: FIND A HOST

Hosting plans vary considerably. Much of what you pay for will be determined by the features your hosting account provides with its service.

Are you setting up a simple, one page site? You could probably use a low cost host for $5 per month. Do you need some extra help with templates and layout or expect a high amount of traffic or downloads? You may have to pay more but it can be well worth the extra expense to have integrated webpages already set up or to ensure your host is providing you with enough bandwidth to handle the traffic on your site.

Never use a free host, unless perhaps you want to start with a blog or similar format while you get your own website up and running. Free hosting usually means you pay in other ways - lack of a domain name or a lack of quality. Many free hosting accounts are for personal use only and do not allow commercial accounts. Try to get recommendations from others when looking for a good host.

STEP THREE: DESIGN

As previously mentioned you can find professional templates on some hosting services. These can give your website a professional polish without the expense of hiring a designer. You are limited, however, on the look you choose depending on the variety of designs available.

Templates are also available to others so your site may have the same appearance as someone else. If you need custom work done consider hiring a freelance web designer from a site like elance.com or ask a local student studying web design. Freelance sites often put you in touch with new designers who will charge less while building on their experience and adding to their portfolio.

Spending money wisely is important when starting any business, but some free services will cost you in reliability or image. On the other hand there are some cheap deals you may not hear about so don't give your hard earned money (or worse - your credit) for a service you can pay less for and get the same results.

Due Diligence – I don’t need it (ya right)

2009-08-21T07:05:00.001-06:00

You have been searching for various businesses for sale and now you have found that perfect business to buy. The business is represented by a reputable broker. You are comfortable with the terms, and now you wish to enter into contract and proceed with the due diligence phase. Everything you have been told by the seller and broker sounds good and feels right. So what’s next? How deep do you need to dig?

Deep my friend. Yes, most brokers are very reputable. But remember they only get paid when the deal closes. And remember also that the broker is representing the seller, not you.

So what should you be digging for? Here is a partial list:

1) Negative business trends;

2) Negative industry trends;

3) Expected but undisclosed competition;

4) Any hint of a personal matter that would restrict the seller from selling;

5) Any partner, spouse, shareholder, or related party that would restrict the seller from selling;

6) Existing or past credit problems with banks or suppliers;

7) Any pending litigation against the company;

8) Any claims, liens, or encumbrances against the company or company real estate;

9) Unpaid income, sales, FICA, unemployment insurance, or other taxes;

10) Timely filing of all tax returns;

11) Expected but undisclosed loss of one or more major accounts;

12) A current disaster recovery plan;

13) A current management succession plan;

14) Stale or nonexistent policies and manuals (including personnel manual, training manual, safety manual, and sexual harassment policy)

15) Retention of key employees;

16) Retention of key accounts;

17) Recent bad publicity;

18) Expiring/ renewal of property lease;

19) Leases that are not assignable;

20) Restrictions on business or property expansion;

21) Capital assets that are at or near their expected life;

22) An established reserve for capital improvements;

23) Obsolete equipment and machinery;

24) Overvalued inventory;

25) Product obsolescence;

26) Expiring licenses, patents, franchise agreements, etc.

27) Difficulty in obtaining raw materials, products, or services;

28) Expiring vendor or supplier agreements;

29) Recent increases in all types of insurance rates;

30) Employee awareness regarding the business sale;

31) Customer awareness regarding the business sale;

32) Vendor and supplier awareness regarding the business sale;

33) Non compliance with safety and environmental requirements;

34) Potential labor union or other employee related issues;

35) Any web site related issues.

As you can see there are many issues that really need to be investigated. Many are very technical. You will likely need to enlist the help of other professionals for assistance. An attorney and an accountant are a must.

Just remember, when you are searching businesses for sale, think ahead. Do not trust everything the broker and seller tell you. You are making a huge decision; make sure it’s a good one.

Transportation Costs Drive Small Business Concerns

2009-08-14T08:00:00.000-06:00

Taking clients out to lunch, delivering goods and performing service duties are what drive entrepreneurs to success. Microbusiness owners and the self-employed depend on transportation to provide their products and services. However, escalating energy costs are making it more difficult to survive and profit as a microbusiness owner.

An online poll from the National Association for the Self-Employed (NASE) asked members how rising gas prices are affecting their business. Over 70 percent of microbusiness owners agreed that rising gasoline prices are significantly or moderately hurting their businesses. Nearly half (43 percent) of respondents increased prices to compensate for the growing costs of fuel.

"Microbusiness owners often depend on their cars to connect with their consumers or use shipping services to mail products," says NASE president Robert Hughes. "Most people did not account for such increases in their travel or shipping budgets for the year."

This year, the self-employed will need to revise their budgets to accommodate increasing energy costs. In the meantime, several options to stabilize energy costs are supported by the association members who opted into the survey. Tax subsidies for energy companies to develop new energy-efficient technologies, as well as tax credits to drivers who buy cars with fuel-efficient technology, were supported by two-thirds of respondents. Additional drilling in possibly oil-rich areas within and offshore of the U.S. appealed to 67 percent of members who responded to the poll.

The National Association for the Self-Employed is the nation's leading resource for the self-employed and microbusinesses, and brings a broad range of benefits to help entrepreneurs succeed and to drive the continued growth of this vital segment of the American economy.

High-Tech Training For Small Businesses-Available 24/7

2009-08-06T06:24:00.000-06:00

There's good news for owners of small-to-mid-sized businesses who want a better understanding of the technology they have come to rely on.

It's no secret that small businesses can gain big benefits by using Internet and computer technology wisely. Fortunately, there are now a number of online resources offered by major tech firms that provide access to information and insight that was once available only from consultants or in a classroom setting.

For example, HP offers business templates and images such as customizable, easy to use brochures, and letterhead, more than 35 how-to guides and over 160 articles that small-business professionals can download from its Web site: www.hp.com/sbso/. Select how-to guides include tips on creating marketing collateral, networking a color printer, and building cost-effective print, copy and fax solutions.

It also has an online learning center at www.hplearningcenter.com that offers free, instructor led classes where small-business owners can expand their knowledge and learn about wireless technology, networking solutions and more.

For those who want additional, on-demand training, the company offers Learning Curve. This service transforms a users' desktop into what's described as a virtual training and support center available 24/7.

Content is delivered via the Web and refreshed frequently, eliminating the need for many expensive on-site training programs.

Microsoft also offers a number of resources, including a Web site dedicated to the needs of small business owners: www.microsoft.com/smallbusiness.

Among the Web site's features is a calendar of free live seminars on small-business technology topics, offered by specialists from the Microsoft Connections team. These events are held in numerous U.S. cities during the year. Small-business owners can also sign up for free Web casts and training on technology issues. Within its Small Business community, small-business owners can participate with their peers in discussion groups, where topics range from how to configure e-mail systems to why some printers use USB cables.

The Web site also provides product information, plus tips and strategies for using Microsoft products such as Office and Small Business Server, and for marketing, management and other issues in running a small business. A major section of the site is dedicated to helping small businesses with computer security; this section includes security checklists, quizzes and interactive videos.

Another feature that small business owners find particularly useful is HP's online chat function for small businesses. It provides a real-time resource, where detailing the types of tech questions small businesses have and the areas in which they are spending their time and resources.

Users can also get instant technical help online with HP's "Ask The Expert." This live technical support is available 24 hours a day, seven days a week.

It makes it possible for users to chat live with HP technicians to help solve their most challenging business application or software issues.

How to Manage Customer Expectations

2009-07-27T13:47:00.000-06:00

Do you often have the thought that your business would operate so much better without customers and all their demands? They want this, that and the other – all of which interrupts your day! But customer expectations are what drives your business and keeps them coming back.

Do you know what your customers are expecting of you? If not, how can you find out? What will understanding their expectations do for your business? In this article we are going to look at expectations and how it’s important for you and your business to know what they are.

What Do They Expect?

Not many businesses endeavour to find out what their customers want! Owners assume they know. Big mistake! If you want to grow your business, find out what your customers expect of you. How can you do this? Ask them! Why not have an ‘Expectations Week’. Tell your staff that this week’s goal is to ask customers what they expect of the business. Set a target of approaching a certain number of customers a day and just ask, “If I was to ask you what your top 3 expectations of doing business with us are, what would they be?”

Alternatively you could put out an Expectations Book and ask customers to write down their comments. This way, they will not be embarrassed and perhaps may be more frank!

If you operate your business remotely, why not do an e-mail survey? Consider offering a prize to encourage responses.

Great Expectations

What is your customer likely to come up with as expectations of doing business with you? Here are some possible answers:

- Fast and efficient service

- Competitive price

- Quality products

- Sufficient stock to meet demand

- Trained staff

- Being treated politely and with respect

- The phone being promptly answered

- E-mails responded to within a reasonable timescale

- Promises being kept

- A clear complaints procedure

- Clean and well maintained premises

Depending on your business, the list could go on! But you have the idea. No doubt you could add many more.

Review and Take Action

Armed with your list of expectations, your next step is to review them and see which ones you are currently meeting. Remember, you may think you are meeting a certain expectation but this is an opportunity for a quick reality check to ensure it’s really happening.

The list you’re left with are the expectations which you are not currently delivering on. Looking at each of them in turn, ask yourself whether, even with the best will in the world, you could meet that expectation. You may have an over exuberant customer who just expects too much! If you realistically can’t meet it, delete it.

You will then be left with a number of core expectations, which you could meet with some thought and action. Sit down with a pen and paper and put in place an Action Plan on what needs to be done to achieve what your customer expects of you. Get your staff together and all commit to putting the outcomes into action.

You’ve Listened!

Having gone to the trouble of asking your customers what they expect of you, don’t forget to provide them with some feedback. If you gathered ideas from the shop floor, put up a notice thanking everyone for their participation and listing the expectations you are taking action on. Why not display an Expectations Charter?

If you had responses via e-mail, reply and again outline what you have done. You could even list the expectations on your web site.

Having gone to all this trouble of asking, reviewing and taking action, it’s all too easy to forget what you committed after a few weeks or months. Make sure that at least once a quarter you re-visit the original list and check that you are still delivering what your customers expect of you.

What Can You Expect?

If you have followed through on the steps, what’s in it for you? After all, the customers get what they want; what’s your payback?

- Your customers are likely to return more often

- They are more likely to remain loyal customers

- They will spend more

- They will be an ambassador for you and your business

- They will generate referrals

Some pretty compelling reasons to put an expectations programme in place!

So, review these steps and consider asking your customers what they want of you. If you can manage their expectations, you manage their experience and so manage your profits!

Shift Your Growth into the Fast Lane by Engaging Your Customers

2009-07-16T10:05:00.000-06:00

Do you feel like you have the “pedal to the metal,” spending all you can on advertising but still can’t get the growth of your business into the fast lane? The fact is, if your customers aren’t engaged, it may not matter how much you spend on advertising. Just like a car in neutral isn’t going anywhere (no matter how much gas you give it) until the transmission is engaged, your business isn’t going anywhere until your customers are engaged.

What does engage mean? Here are three definitions you might find in a dictionary:

1. To attract someone’s attention
2. To establish a meaningful contact
3. To move into position so as to come into operation

Combine the three of them and it provides a pretty good working definition for engaging your customers:

Attract your customers’ attention with the intent to establish a meaningful relationship and move them into position to help your business grow.

Without worrying too much right now about how to engage your customers (we’ll get to that) let me propose multiple levels of possible customer engagement as represented by this pyramid model.

At the base of the pyramid is your total available market. That is, all of the potential customers in the world. They have potential, but at least at this point no level of engagement with you or your company.

The next level derives its name from a term we have all used when asked by a sales man if we need help, “No, just looking.” The fact that we are looking means we are more engaged than the masses, but we’ve yet to make any great commitment.

Just beyond Just Looking is Just Buying. For most companies this is the height of their ambition. Get a sale, book the profit and move on to the next customer.

Above just buying is buying again. This is a level that in general assumes that the customer was pleased enough with their first purchase to be willing to come back and purchase again. I say in general, because it is possible that they have no other options and therefore they have no choice. For you as the business owner, this is a very good level. Serving a repeat customer costs less because you don’t have to pay to acquire them and they are less expensive to serve in most cases because they are already familiar with you and your operation. The more customers you can get to Buying Again , the more profitable you will be.

But there are customer engagement levels even higher than Buying Again. The first is Giving Feedback. This refers to customers that are willing to invest more of themselves in your company than just their money. They do this by making the effort to tell you how you can improve your offerings. In effect, they go beyond the typical definition of customers and become co-producers, helping to ensure that your offering is exactly what the market wants and needs. Two great things happen in the process: 1) As your offering improves so will your sales and, 2) As the customer invests their ideas in your company they will become even more loyal and move to the next level.

At the top of the pyramid is Telling Others. At this level your customers are so pleased with your offerings they can’t be stopped from telling others. They become co-promoters, a very powerful sales force willing to tell perfect strangers and best friends how wonderful your company is. As consumers in general become ever more jaded and less trusting of traditional advertising, the growth of your company will be largely dependent on how many of your customers become promoters.

Having described the model, let me hasten to add that I know it is oversimplified. Not all customers will move through each level. Some will become promoters without ever providing feedback. Some will provide feedback and then go away and never return. Despite its simplicity, I believe the model can be helpful in understanding the concept that customers can become much more valuable to a business than just the value of the purchases that they make. Consider the following:

This chart attempts to show in relative terms how much a business benefits financially from a customer at each level of possible engagement. At the far left, Just Looking, expenses associated with a customer typically exceed income from that customer. For example, you spend money on advertising and attract the attention of a customer willing to take a look. At that point you have paid out (for advertising) more money than you have brought in ($0 purchased by the customer).

For those customers that take the step and buy your offering, chances are you will cross over into positive returns. If the customer returns to buy again and again your profit from that customer will increase. Note that the slope of the line becomes steeper in the buying again phase. That is due to the fact that it is less expensive to sell to returning customers than it is acquire new customers. In fact for most businesses it costs five to ten times more to acquire a new customer than it does to sell more to current customers. The obvious difference is the acquisition cost associated with attracting new customers. The less obvious reason is that a regular customer already knows how your product or service works and doesn’t require as much “hand holding” throughout the process.

As the curve continues into the higher levels of engagement, Giving Feedback and Telling others, its slope becomes even steeper indicating that significantly higher returns are possible. Two reasons for this: 1) The additional costs required to move customers into these levels is relatively small and 2) The potential returns have a built in multiplier effect—that is, one customer’s actions can influence many other customers.

For example, feedback from one customer that helps you improve your offering not only benefits that one customer and brings them back again but benefits all your customers and increases the likelihood that they will return more often. Even more obvious, a customer who begins telling others about your business brings not only her purchases but the purchases of several new customers to your business.

In conclusion, engaged customers will help you improve your offering, they’ll actively promote your product, they will improve your bottom line, and, to a large extent, they will determine how fast your business will grow. As you consider the growth of your business, look not only at how many “Just Looking” customers you can bring in and move to “Just Buying,” but also consider how you can get your “Just Buying” customers fully engaged in your business.

Help Your Small Business Succeed With A Credit Card

2009-07-07T06:34:00.002-06:00

One of the many difficulties of starting a small business is gaining access to capital during the startup phase. With the large growth in small specialty businesses across the country, credit card companies are beginning to design special programs to help this new breed of business achieve success. For even those small businesses that have access to capital, the perks and benefits associated with small business credit card programs, can still be useful to help you compete more effectively in the marketplace. Below are just six of the many ways in which a small business credit card can help your business to operate more smoothly and improve your bottom line.

Ease Your Cash Crunch

A small business credit card can ease your business’s cash woes. Through the development and implementation of a sound financial plan that utilizes a credit card you can guarantee that your business will always meet payroll, be able to purchase inventory on an as needed basis, and manage both seasonal and business fluctuations without depleting your cash reservoir. Another added advantage is the cash advance feature, which allows you to withdraw cash from an ATM to cover emergencies and other unanticipated expenses.

Unlike a personal credit card, a business credit card also provides a business size credit line, which is substantially higher.

Keep Track of Business Expenses

Through the use of a credit card, you can, with little to no effort, separate your business expenses from your personal expenses. This allows for easy identification of tax deductions and filing of accurate income tax returns.

Secure Multiple Cards

You can also secure more than one card through small business credit card programs. This allows you to give employees the authority to make purchases while freeing up your schedule for more pressing issues. You can also do this with ease since you are also given the ability to set spending limits for different employees, which will further help you to control your expenses.

Access Free Business Resources

Anything free is good! Some credit card companies also provide clients with a wealth of resources to help manage cash flow and develop good record keeping procedures free of charge. Extensive reporting is conducted on both a monthly and bimonthly basis to help you track your expenses down to the penny. Additionally, free business checks and electronic funds transfers are also available.

In addition to that, you can also access reports, data and advice on developing business and marketing plans, conducting market analysis, and pricing products through a company’s web site. You can also increase your knowledge of other products and services like software programs that can help your day-to-day operations run more efficiently.

Build Credit to Qualify for Larger Loans

Obtaining a credit card and using it wisely can also be a stepping-stone to help your business qualify and secure a loan with a major bank or venture capitalist firm. By establishing a good relationship and credit history with a company that also offers other products and services, it’ll just be a matter of time before other cost-saving services are thrown your way.

Perks and Rewards

Perks and Reward Programs designed especially for small businesses are by far one of the best features of a small business credit card program. Small businesses can earn airline points and cash back rewards just like the big boys. Discounts are also available through select merchants like FedEx and Staples, which can result in huge cost savings for supplies and other operational expenses. Some companies also go an extra mile by providing rental car and lodging benefits.

Does My Small Business Really Need a Press Kit?

2009-06-30T05:26:00.000-06:00

When the “experts” tell you you’re going to need a press kit for your small business I’ll bet you’re wondering why on earth you’d need one. At least, I think you’d wonder why if you think a press kit is just for the press. But the term ‘press kit’ is misleading if you ask me because press kits aren’t just what their name implies.

I prefer to call them small business information kits or information packages instead because that’s what they really are. They are meant to inform everyone, not just the press about you and your business.

Once you have a small business information kit, you’ll find you’re often giving them when someone asks for information about your company--who you are, what you do, how you can benefit them. In fact, you’ll probably find you’ll give out almost as many of your information kits as your business cards.

Sometimes it’s more appropriate to simply hand out just your card, but other times, you might like to give someone more information than what’s on your business card.

Say you’re at a party and someone asks what you do. You’d probably just give them your business card. But your business card gives this business contact only the briefest information about your company.

So, you might also ask for their name and address, and send them an information kit the next day. Sending your information kit the next day also works as an important reminder of the evening’s discussion.

On the other hand, if you’re a plumbing company, you might want to contact construction companies in your area to see if they’re interested in subcontracting your company from time to time, or better yet all the time!

Sending them just a business card probably won’t get you very far. Even sending a well-written letter introducing your company together with your business card probably wouldn’t be as effective as a complete information kit.

You could think of your business card as the “who and the where, and a little bit of the what” of the 6 interview questions—who, what, where, when, why and how. Your card probably has your business name, contact information and possibly a slogan, motto or some saying suggesting what you do.

Your information kit on the other hand, answers all the questions. It tells people who and where you are, just like your business card does. But instead of one little line suggesting what you do, your information kit tells people exactly what you do. How well it tells them what you do depends on how good your copywriting is.

And it tells them how to buy, (with your convenient order form for example, or by phone or fax, with cash, check or credit card) and when to buy (today, right now, before the special offer expires).

Your business card doesn’t have the room to tell people why they should buy from you, but your information package does. And not just by telling them you’re the biggest, the best, and of course the most innovative either.

The real secret is convincing people they can’t do without your product or service, remembering that along with a great description of your product or service, to consider your information kit from your clients’ perspective. Everyone wants to know how what you do can benefit them. How you can save them time or how you can save them money, or how you can make their life just a little bit easier.

One last word on presentation of your small business identity package. It’s almost as important as what you say. A professional image can go a long way in assuring potential clients your small business is the one they want to do business with.

You cannot compete with big companies without one, and you’ll be miles ahead of the small businesses that don’t have one. And while we’re talking about professional image, imagine how your small business will be perceived when you have the ultimate in professional image-- a matching corporate identity package, information kit and small business web site.

Disaster Preparedness For Your Small Business: How To "Weather" Any Storm

2009-06-23T07:01:00.000-06:00

In the event of a potential disaster, do you have a business continuity plan for your employees and your business? Are you backing up files on a routine basis, and could you recover them in an emergency?

On average, nearly 60 percent of businesses damaged in a disaster close after a year, according to the Association of Small Business Development Centers.

Devastating hurricanes heightened awareness of the importance of disaster planning for businesses, large and small. But destruction of your company's infrastructure is not limited to natural disasters-it can happen anytime. Daily misfortunes like computer crashes, network breakdowns, and power outages threaten your business each and every day.

Having weathered four major hurricanes at its corporate headquarters in South Florida and across nearly 100 stores in the Gulf region, Office Depot has real-world experience in disaster planning and recovery. To help businesses be more prepared, the retailer has compiled "Disaster Preparedness: Advice You Can Depend on to Weather Any Storm."

"A sound contingency plan can enable your small business to respond effectively to a crisis, and prevent that crisis from becoming a full-fledged disaster," said Tom Serio, Director of Business Continuity Management for Office Depot.

According to Serio, the overarching principle in disaster planning and recovery is to protect your most valuable and irreplaceable assets: your people and your data. Among the guide's other recommendations:

• Keep contact information for employees and local emergency services, as well as key vendor and supplier information, updated and easily accessible. Establish a clear process for communications and plan how you will contact one another in different scenarios.

• Protect your business from faltering after a disaster by backing up key data at least once a week. Copy data to removable media, including DVD-R or CD-R discs, or to removable drives such as the Ativa McAfee Flash Memory Drive with anti-virus software.

• Move back-up software to a secure off-site location. Store copies and documents you use in day-to-day operations in a secure and fire-proof location like the Sentry Fire-Safe Electronic safe.

• Periodically review the data being stored on any back-up systems to ensure that the right data is being copied and that it can be restored.

Creating Cash Flow with Old Inventory

2009-06-17T06:44:00.000-06:00

There is a comment many business owners use today. It is “I'm not giving away my inventory". It is most common among store owners that business is in bad shape. It is too bad that most retail owners don't understand about inventory. Inventory does two things. It either makes you money or costs you money.

You need to have sufficient inventory to be profitable. However, having too much inventory is a larger problem than too little inventory.

Too much inventory ties up critical cash for your business. It can also result in more damages to your merchandise. The key is to find the right price to move your merchandise. Slow moving items take up space and cash that could be used for more profitable items.

There are times you have to adjust your pricing strategy. For example, let's assume your retail price is double your cost. In this example, you pay $10 and it retails for $20. If it is a slow mover or discontinued item, what should be the new price? I would take 20% off for 1-3 months, 50% off and then 75% off. If you have to sell at 75% off, you will sell below cost. Cost should never be a factored in marking down an item.

I can hear you yelling now. I'm not giving away my inventory. You are looking at your inventory from the wrong perspective. Your product is worth what a customer will pay for it.

Using my example, let's say you sold your product at 75% off. How much did you make on that item? Your answer most likely was a loss of $5.This was based on a $10 cost and $5 retail. That answer is partially correct. The more correct answer is that you made $5.

You took an item that was producing zero and turned it into $5 cash. You can take that cash and space and use it for a profitable item. Many times a business does not have enough cash to buy the needed quantities of the best-selling products. If you take the cash from the poor sellers and use it for good sellers, you will more than make your money- back.

No matter how good a buyer you are, there will be items that don't sell. The key is to realize this and react before it ties up too much cash and profit.

An added benefit of taking care of your problem inventory is increased sales. You will get customers who will shop your store regularly looking for your markdowns. Many of them will buy your high gross items also. If you take care of your problem inventory regularly, your markdowns dollars will be less.

Inventory is critical to your business success. The key is to take action on the slow moving and discontinued. This will make your bottom line better in the long run.

Cost-Cutting Tips for the Small-Business Owner

2009-06-10T10:53:00.000-06:00

One of the keys to running a successful small business or home office is learning to control costs. Even the smallest expenses can quickly add up and cut into profits, leaving you with a business that won't move forward.

Many small-business owners know where their money comes from, but are not as clear on where it goes. This can have a significant impact on their businesses' cash flow.

It's important to review your expenses regularly - every quarter if possible - so you can accurately manage your outgoing expenditures and look for ways to save.

Demos Parneros, president of U.S. stores at Staples Inc., provides the following suggestions to save your business money.

* Buy last year's model. Furniture, computers, PDAs - there is always something new. This also means that there is always something old. If you wait until the end of the year or for sales throughout the year, you can save on your office needs.

* Buy in bulk and buy ahead. By buying commonly used items in large quantities, you can save a lot. Replenish your supplies before you run out. Thinking ahead, and thus buying ahead, gives you a chance to comparison shop and take advantage of sales.

* Buy products that save money. Consider quality alternatives to national brands. Staples ink and toner products, for example, offer consumers quality products at a 15 percent to 20 percent cost-savings per cartridge.

* Take advantage of discounts. Professional and trade associations often offer their members discounts on insurance, travel, shipping and other common expenses. Similarly, some credit cards, like the American Express Corporate Card for Small Business, may get you discounts as well.

* Save on mail costs. Mail costs for your business can add up fast. To save money, use postcards or consolidate shipping. You also can buy or lease a postage meter or get a mail scale to eliminate overpaying.

Choosing a Company Name

2009-06-03T12:46:00.000-06:00

When forming a limited company the name of the company can be an important decision. Some people may choose the first name that they think of and others may select a ready made company for speed or because they like a particular name. However, many businesses may prefer to select a company name that either clearly distinguishes itself from its competitors or contains something unique or personal. Company names can be chosen for different reasons.

One of the most common ways of selecting a company name is to use something personal. A quick look through your local newspaper will probably introduce you to many personalised business names. Johnson Consulting Limited, T Smith & Son Limited, Stephens & Barley Limited are some fictional examples of what may be found. This may instantly make a company recognisable locally, it can be deemed as more personal by its customers, and often works well within geographical areas. However, it does little to tell new customers what your company does.

A popular choice for a small business is to choose a name that is ‘descriptive’. This tells prospective clients exactly what your company does. Examples of this may be to call your business The Window Company Limited, City IT Consultants Limited or The Advertising Agency Limited. Whilst this does serve to reinforce your primary business it offers little differentiation and may easily be adapted by competitors.

A less personal option is to use a company name that is ‘associative’. This type of company name helps to create an image or connection to your business activity. It is less direct than using a descriptive name but helps to position your company’s name within the market through peoples understanding of what words mean. For example a flick through the Yellow Pages will offer plenty of examples of this. A hairdresser called Classic Cuts or a printer called Selectaprint Limited are examples of what may be found. These names offer some differentiation but may not ultimately set your company aside from its competitors.

An alternative is to choose a company name that is ‘freestanding’. These names are completely abstract and not related to the companies business activities. A fictional example may be to call your catering company Zedoc Limited. There are many popular brand names that illustrate this point. Consider, Kodak, Gillette, or Mars, these names will probably be instantly recognisable to you and conjure up a particular product or business. This is a good way of setting your company aside from the competition but it is important to consider the market that you operate in. Will your prospective clients know what your business is offering?

Choosing a company name may be a simple process, but it is not uncommon for people to deliberate over names for quite some time. Whilst company names can, and often are, changed during the life of the company most people like to choose a name that they like from the outset. Therefore consider your market, how much you want to differentiate from your competitors and what your company name should say about your organisation. Once the decision is made focus on the important business of making your company a success.

Cash Flow Planning for Solo Professionals

2009-05-28T07:22:00.000-06:00

You’ve heard it a million times – cash flow can make or break a business. Lack of cash flow planning is the reason why many businesses fail. In fact, many PROFITABLE businesses fail because of cash flow issues. Without adequate cash flow, you can’t pay your bills and you can’t make plans for your business.

So… what is cash flow planning? Cash flow planning is projecting your future cash inflows from sales, services, and loans, and comparing them to your future cash flow needs (suppliers, salaries/wages, loan payments, taxes, etc.). The difference between the two is your net cash flow.

Why is cash flow planning so important? Cash flow planning can help you identify problems down the road, and fix them before they occur. Cash flow planning can also help you make decisions such as should I attend that conference I’ve wanted to attend, should I buy the new computer I’ve been wanting, or do I need to work extra hard this month to avoid a cash flow deficiency next month?

The first step in planning your cash flow is knowing where you spend your money! Solo entrepreneurs need to have a good grip on both their personal and business spending, as most solo entrepreneurs rely on their business income to meet personal finance goals (i.e., pay the bills!). So, you should track both your personal and your business spending, although I recommend that you keep them separate (that’s a topic all by itself).

What’s the best way to track your spending? You can use pen & paper, spreadsheets or a software program. The best method for you is the method that you will actually use on a regular basis.

You should project your spending for at least the next 12 months so that you include annual and other periodic expenses. If you are experiencing a cash flow crisis, you should track & project your cash flow on a weekly basis, instead of monthly.

If you are an existing business, you can project your cash flow for the next year by reviewing your expenses for last year. If you are a new business, you will need to estimate your start up costs in addition to regular operating expenses.

Start up costs include inventory, legal expenses, advertising, licenses & permits, supplies, and many more costs that you may not have thought of. To research startup costs you should contact your local Small Business Development Center, contact a SCORE counsellor, join groups of similar business owners, and read as many books or articles you can find on the subject.

To improve your cash flow, you should:

1. Complete the first 3 steps. You have to understand cash flow planning, track your cash flow, and project your future spending needs before you can improve your cash flow.

2. Create best and worst case scenarios and create appropriate responses to both scenarios. For example, if your best case scenario is to increase sales by 50%, how will you use the profits? Will you put the profits back into the company by investing in new equipment, training, etc.? If your worst case scenario is a drop in sales by 50%, how will you continue to cover your monthly expenses? By planning for the best and worst case scenarios, you’ll be ready for any situation.

3. When estimating your future income, realize that some people will pay late, and account for that fact in your projection.

4. Charge what you’re worth. Many businesses, especially service professionals, under-charge when they are first starting out. This is a great way to go out of business. Make sure you are charging what you’re worth, and remember you’re in business to make money, not to give your expertise away for free.

5. Watch your business spending. Focus on the value the item brings to your business, and avoid lavish spending (i.e., do you really need the fastest, newest computer available?).

6. Don’t hire until necessary. Consider using virtual assistants or temporary employees before hiring permanent employees.

7. Give incentives for early payment for products and services. On the flip side, chase down invoices the minute they’re late. Charge interest or late fees to encourage timely payments.

8. Update your cash flow regularly. Your cash flow plan will change frequently as your business grows. You may want to update your cash flow plan weekly when you first get started, then switch to monthly once you’ve got a good handle on your cash flow.

Remember - whether you are a new or growing business, your cash flow projection can make the difference between success and failure.

Can accounts receivable factoring help your business grow?

2009-05-22T05:46:00.000-06:00

Are you stuck with great but slow paying clients? It is interesting how your biggest asset (great clients) can also be your biggest liability. But that is how business is. And as an owner you must adapt.

Whether you like it or not, slow paying customers are here to stay. As a rule of thumb, commercial clients pay their bills in 30 to 60 days. And lately, the trend has been deteriorating. So, what do you do if you have slow paying receivables?

Many owners try to go to the bank to get a business loan. Not surprisingly, few business owners get business loans. As a rule, banks will only finance companies that have long and established histories. This is not your case if your company is new or emerging from tough times.

If your biggest challenge is that you cannot afford to wait up to 60 days to get paid by your customers, then the solution is accounts receivable factoring. Most commonly known as factoring, this type of financing eliminates the usual wait to get paid. It provides you with the necessary funds to pay suppliers, meet payroll and take on new business opportunities.

And how does factoring work? Simple:

1. You finish the work and send an invoice to your client. You also send a copy to the accounts receivable factoring company.
2. The financing company advances you 70% to 90% of the invoice (a small reserve is held to handle disputes, etc.)
3. You get the funds in 24 hours
4. As soon the customer pays the invoice to the financing company, they rebate the reserve (less a small fee)

As you can see, accounts receivable factoring can easily be integrated into your business, providing you with prompt invoice payments. Usually, funds are advanced within 24 hours of submitting invoices.

Accounts receivable factoring is easy to qualify for. Accounts can be set up in as little as 4 business days. As opposed to business loans, the main requirement for factoring is to do business with strong credit worthy customers. So if you do business with good commercial clients (or the government), be sure to add factoring to your business tool chest.

Business Tools to Help You Run a Successful Business

2009-05-18T09:36:00.000-06:00

When setting up a business, even the best prepared among us will struggle to do everything and remember everything. It is very unlikely that we will understand all of the financial and legal ramifications of a new business, especially when we need to concentrate on getting that elusive first sale or completing the first contract. It isn’t always feasible to employ an accountant and a solicitor as well as a secretary, a salesperson and any other workers needed in the daily running of the business. So, we need to be able to diversify when setting up a new business and the best piece of advice anyone can give you to help is to make the most of the widely available business tools on the market.

Financial Documents and Tools

An accountant is a very expensive commodity that many new businesses can afford full-time. It is down to us to undertake as much of the financial side of things as possible; a daunting task indeed. There is help at hand in the form of business tools.

Spreadsheets have become immensely powerful and can do much of the financial work that any business needs, even invoicing. The Internet is awash with free standard documents for almost any occasions; if you aren’t proficient at doing this yourself, you can find balance sheets, daily cash sheets and almost anything you could need.

The Legal Minefield

Mention legal documents to a new business owner and most will curse you. Again, paying for a lawyer to create all your contracts and other legal documents is a cost that new businesses may not be able to afford. Look at other contracts, get ideas off the internet and take a look at the standard contract and terms and conditions guidelines and when you’re ready, book a session with an affordable attorney and let them look over everything. This way you will only pay once and get all the information you need for an affordable price.

It is important that you get any legal documents checked at least once. A poorly written contract can cost you a lot more than the lawyer’s fees.

Human Resources

Human Resources, or personnel as it was once known, will become very important when you start to employ staff. There are a lot of rules and regulations to abide by as well as a lot of extra information to store that is both important and confidential.

You can get time and attendance software, standard contracts, standard terms and conditions and software to look after your payroll details.

These are just a few tools available to new business owners. To do a job right requires the right tools. It is better to spend time researching your options first to find the right tools, than to get yourself into a real bind attempting to do the job with the wrong (or no) tools. You will find that the time it takes to get the right tools will pay off time and time again.

Business Selling Process (Simple)

2009-05-13T11:19:00.000-06:00

Business Selling Process (Simple)

1. Determining the fair market value of the business
2. Set Preparing all books and records for prospective buyers
3. Putting the business on the market
4. Dealing with the potential buyer
5. Receiving an offer
6. Negotiation - Price, Terms, and Condition
7. Accepting an offer
8. Provide all necessary books and records to the buyer
9. Work with the buyer to remove all contingencies of the contract
10. Signing the closing statement (1-3 days before the closing date at the escrow)
11. The night before the closing date
12. The closing date

Business Financing Guide (Simple)

2009-05-04T06:26:00.001-06:00

This business financing guide shows the items that you will need to prepare if you are planning to get loan from financial institution when you buy business for sale. Getting financing can be easier with knowledge about the financing and with complete preparation of documents and statements in process of buying business for sale.

Step 1. Find a Business - for sale at BusiMarket.com site for businesses for sale and commercial property for sale on the market. As soon as a property is found, make any necessary contacts to sellers.

Step 2. Get Purchase and Sale Agreement - Get the sale agreement from Brokers, attorneys, or Escrow companies.

Step 3. Find a Lender - Find a Loan Officer that will take care of your financing needs.

Step 4. Prepare Required Documents - Purchase and Sale Agreement for the Business or Commercial Property,
- Personal Financial Statement provided by the lender,
- Income tax returns from both buyer and seller from the last three years
- an up-to-date income statement,
- Resume from the buyer,
- Lease Agreement (if applies),
- Assignment for Lease (if applies),

Step 5. Finally, wait for the loan approval (usually takes 2-4 weeks)

Since the financing process can be different on type of business, location, and buyer's situation. The information above is for information only and BusiMarket.com does not guarantee accuracy of information.

Business Cost Savings Through Safety

2009-04-30T09:36:00.000-06:00

Business Cost Savings Through Safety

Setting a health and safety program in place will reduce costs. Having a program will reduce accidents and will lead to lower company worker’s comp premiums; further business insurance companies prefer their customers to have health and safety programs. These insurance companies might even discount the premium if a program can be proved to exist. The average cost of an accident is $68,000. Direct costs in accidents such as worker’s comp and fines levied can close a business. Indirect costs such as low morale of employees, legal fees, and retraining can be as costly if not more.

A working program will:
1) Improve employee morale – Shows care in their well being
2) Reduce revenue losses – Fewer accidents keeps all employees at work
3) Give a boost to the customer – Makes sure business is operating optimally

Small businesses that have a voluntary health and safety program in place have fifty percent less accidents and reported insurance claims than that of their counterparts according to OHSA stats. Most small businesses fall below the legal requirements for having a formal health and safety program in place due to number of employees on staff. Sixty eight percent of reported accidents are in the service industry which shows even businesses such as retail establishments are not free of accidents.

A health and safety program can be started by writing a health and safety policy; this is simply values that a company wishes to convey in its work processes. Secondly, is how communication between all employees and owners will function. And lastly, put procedures in place to ensure safe practices.

To find unseen hazards and unsafe practices, an audit needs to take place. Take a hard look at the workplace and record all factors that may lead to injury. These hazards might be dangerous chemicals or as simple as a letter opener. Identifying these hazards will lead to procedures to controlling them. Controls such as “Don’t run with scissors in your hands” are effective. Write all procedures in a manual.

Implementing these health and safety procedures will be done with behavioral change. Some programs become weak and non effective because of:
1) No definition of safety practices – No written processes
2) No teamwork – Safety is communication from the top to bottom and vice versa. A well written plan will describe what roles everyone plays in safety policies.
3) No effective goals – The “accident free days” poster will come as a result of sound safety processes.
4) Wrong incentives – Money as a reward does not work well. Health and safety should be fun and worth employees effort. The right incentive plan can be cost effective and have obtainable goals. Incentive plans can include movie passes or simply “free coffee on the boss.” The insurance industry reports for a dollar spent on health and safety yields four to six dollars in savings.

Once all of the hard work of developing and implementing the health and safety program is done, set aside some time each month to review the workplace. Record what is found; this is a good practice to see dangerous trends that might occur such as a fire exit constantly being blocked. On the quarters of the year post a meeting with employees. These meetings are a great way to get vital feed-back from employees and keep them involved. At least once a year, do an audit to make sure your health and safety program is current with present business operations.

Business Buying Guide - Detail

2009-04-22T09:54:00.000-06:00

Business Buying Process

First, You have to determining your investment. Usually minimum down payment made by the buyer is 30% of the purchase price. For example, if the business purchase price is $100,000 and loan amount is $70,000 (70%), then the buyer's down payment needs to be $30,000 (30%). Other possible expenses are inventories, supplies, escrow fee, license and permit fees, franchise transfer fee (if applies), etc.

And then you have to set criteria of desired business. Which includes location of business, type of business, price range of business, desired income of business.

After you decide your investment amount and criteria of business, you will need to find a right business that fit your needs. You can search business through online business listing service site like www.BusiMarket.com Business For Sale, local newspapers, or through local business brokers or real estate agents.

If you find a business that you want to purchase, you will need to evaluate the business through current owner's income information and your projected income for short term and long term.
And then you need to make decision to purchase business or not. If the business is right for you, you need to write a very descriptive and detailed contract (Purchase and Sale Agreement).

When you are writing an offer, you have to make sure the contract includes the followings: Your offering price, Initial deposit amount, financing terms, closing date. Other terms and conditions that can be added to the contract is buyer's loan approval, lease and lease approval from landlord, buyer to obtain all necessary licenses and permits, franchisor's approval of ownership transfer, the buyer's Satisfaction of books and records, closing cost allocation, buyer training session, business equipment and fixtures in good working condition, inventories and supplies amount, seller's agreement not to compete, etc.

After you finish writing an offer, you need to present your offer to seller. Negotiate the price, terms, and conditions and settle with final price and terms and condition.

Now you will need to allocate the purchase price of business that you are buying. After you done purchase price allocation, you will need to apply for loan, license and permits.

and then you will need to obtain a lease or sublease. You will need to make sure you obtain the lease or get an approval of lease assignment before close of escrow no matter what happened.

And then on or the day before the closing date, you will need to review the equipment list that is provided at the time of the acceptance of the Purchase and Sale agreement and buy inventories and supplies. And then you can do the closing on the closing date.

Breaking the Chains!

2009-04-17T08:28:00.000-06:00

Everyday, customers and business owners are bombarded with billboards, logos, print and electronic ads from huge corporations. With annual ad budgets that are more than our businesses' SALES in an entire year, our small independent businesses are getting squeezed out of consumers minds (and wallets) more and more each year. But the good news is, there are ways to fight back and “break the chains”:

Build that website and perfect your online presence.

The Internet is one place where, compared to print and other forms of electronic media, the playing field is relatively level. A website filled with loads of great content will be loved by the search engines like Google and Yahoo!, and because of that, customers that may not even know where you are can find you and buy online. If you own a retail store, start an e-store. If you own a restaurant or a service-related business, offer a gift certificate or printable coupon. Starting a mailing list on your website with the latest news, events and special offers is a great way to get (and keep) loyal, regular customers. The options are endless, and best of all, content is the Internet king, not slick, flashy, repetitive advertising. If you aren't comfortable with all things Internet, there are many companies that are, and can help you with web design, web hosting, search engine optimization, and web marketing.

Join (or start) a co-op or business association.

“Strength in Numbers” is more than a catchy phrase, it is becoming a necessity in our current business climate. Trade organizations can purchase products together to get better rates and buys, they can advertise together with direct mail coupons and newsletters (another big money saver), and they carry more political clout by appointing representatives to call on state legislatures or even Congress in order to promote legislation favorable to small independent businesses. If your area doesn't have a trade organization, or does but you feel it doesn't meet your needs, start one! The National Federation of Independent Business is a great resource with representatives in all fifty states and Washington D.C.

Don't mimic Corporate America

Advertising is not cheap, because the prices that the large corporations are willing to pay for it have priced it out of the reach of most small businesses. This is not necessarily a bad thing; let them have all of the cold, impersonal, beat you over the head repetitive advertising! People only care about this on Super Bowl Sunday anyway! Always go for the personal touch. If you own a restaurant or retail store, introduce yourself. Let them know you appreciate them coming by, and you can't wait to see them again. Always offer coupons or incentives, and be as unique, creative and memorable as you possibly can. Remember that “word of mouth” advertising is so great you can't put a price tag on it. Put yourself in the customers shoes, and stay there! Don't ever do what you want; do what they want. Don't just market your business, market yourself. It leaves an impression, and with the sorry state of customer service today in most (chain) businesses, people won't forget it!

Remember, you are an independent business because you wanted to do something new or different, so promote yourself accordingly. Here's to you “breaking the chains” and becoming successful with your chosen endeavor.

Boomers Have Big Hopes For Small Businesses

2009-04-13T07:26:00.000-06:00

As they approach retirement age, many baby boomers are considering alternatives to retirement.

A growing number of them plan to forgo golf, travel and other pursuits to continue working through what have long been considered the retirement years. According to a report by AARP, 80 percent of those born from 1946 to 1964 plan to work after retirement.

Some are taking this time of their lives to start a small business. In fact, AARP also reported that 40 percent of U.S. entrepreneurs are over 50.

For those thinking to take advantage of this trend, Paul and Sarah Edwards, self-employment lifestyle experts and authors of "The Best Home Businesses for People 50+," offer some advice. "Starting a small business out of the home at any age can be very challenging but rewarding," says Edwards. "However, Sarah and I have developed a few tips for our fellow boomers to keep in mind when embarking on this exciting new phase of their life."

• Do it Your Way. A home- based career allows you to decide everything from how much time you want to dedicate to your business to where you want to be located.

• No More Office. Many experts believe that taking a business online is the easiest way to accomplish your goal of working while maintaining freedom. If your small business is located online, you have low overhead costs and can be found by customers around the globe without regard to where you are located.

• Have an Online Presence. Virtually every business can be helped with a presence on the Web. This is easier than it seems if you work with a reputable Web solutions partner.

For example, Network Solutions focuses on small businesses by offering products and services such as Do-It-For-Me Web sites (DIFM), easy-to-use templates and 24/7 customer consultants. Such services provide you with a Web partner that will enhance your business.

• Do What You Enjoy. "Becoming your own boss is an opportunity to do something you want to do," says Sarah Edwards. "For example, you can spend as much time as you want on a hobby because you're making money in the process, or helping other people or working with the kind of customers you choose to work with."

Blend Your Strengths with Small Business Needs

2009-04-10T13:01:00.000-06:00

If you are looking to start a small business of your own, there is a proven process that is necessary to start off with. Many creative people have great business ideas, but their approach to planning is ineffective and eventually flops. First and foremost, you have to find a market that is a good size. Now what does this mean exactly? Finding a niche market that is a reasonable size entails pinpointing one that is big enough to make a profit but small enough for the resources of a small business and one that does not compete with large corporations.

Two main mistakes that entrepreneurs make in finding small markets are targeting a market that is too broad and targeting a niche that is already heavily exploited. What you decide to sell must connect product to target audience or you will not be successful.

To start off with, choose your own unique area of expertise. What are you good at? What do you have experience in? Use your education, your skills and the people you know who could help you transform your idea into reality. If you have many areas of interest and are not sure which one would be the most profitable, a little more research will be needed. Consider how it will be possible to convert your education and skills into money-making opportunities. Research your surrounding marketplace to see what is needed in your area.

Now if you are trying to find small markets online, be forewarned that this can be tedious and time-consuming. You will first have to think of a list of possible target audiences, then take your first idea and research an exhaustive list of keywords and keyword phrases that people in that target audience are using for information on their desired product. Next, one must research all keywords and phrases for relevancy and then study which keywords on your list might lead to other niches that will need future researching. Then, you need to compare all your keywords to web pages to evaluate the present competition. You will use all your information to narrow down your list to keywords and phrases that have the most online traffic and those that are the least exploited. If your small market does not appear to be profitable, you must start the entire research process over. If you do find one that seems to be a money maker, you then must focus on finding ideas to profit from.

Calculating The True Cost Of Disaster Preparedness

2009-04-07T16:32:00.000-06:00

Small-business owners who think preparing for a disaster is expensive should think again. Being unprepared-and losing everything-can mean paying a much higher price.

For example, in July 1996, the president and owner of Brookville Mining Equipment Corporation, Dalph McNeil, faced every business owner's nightmare when the nearby creek crested at eight feet after a 24-hour downpour.

Expensive new machinery was covered in mud and a powerful current of water had swept away inventory and collapsed a 30-foot section of wall. The flood caused nearly $1.6 million in damages and losses.

After receiving a Small Business Administration (SBA) disaster loan, McNeil relocated his plant away from the floodplain and asked one of his employees to take on the additional responsibility of "safety coordinator."

Besides doing quality assurance and control, the safety coordinator, according to McNeil, "runs monthly meetings with representatives of the company, making sure all the employees understand the early warning and evacuation plans, and the emergency procedures."

"You can never be too prepared, as a small-business owner, for disaster," McNeil remarked. "It's something you don't want to think about. How do you carry on business as usual, as quickly as possible, after a disaster? You have to be a bit of a fatalist, thinking in terms of the worst-case scenario for your business." And while he hopes he never has to use the emergency plans he has in place, McNeil says he is now ready for anything.

Experts say preparedness starts with developing such an emergency action plan that is tailored to the company's needs and addresses several disaster scenarios. The plan should include a timetable, budget, assignment of responsibility, prevention and mitigation steps to be completed, and a list of risks and hazards to the business. It's also a good idea to encourage employee involvement in the process.

A communications strategy is a key post-disaster recovery strategy. Phone numbers and e-mail addresses for your insurance carrier, suppliers, creditors, employees and customers, the local media, utility companies, and the appropriate emergency response and recovery agencies should be updated regularly.

This list should be maintained by a key employee and a backup person. Appoint a spokesperson to get the word out that your business is still open to dispel rumors of business failure.

Making sure your insurance coverage is adequate is another issue. According to the Insurance Information Institute, a recently released survey conducted for the National Hurricane Survival Initiative (done by Mason-Dixon Polling & Research) reports that one in three residents in hurricane-vulnerable states said it had been three years or more since they reviewed their insurance coverage.

When shopping for insurance, think about property damage and the loss of revenue and extra expenses that occur when business is halted by a disaster. Business interruption insurance covers necessary expenses that occur while the business is shut down. Many business owners don't realize that basic hazard insurance does not cover flood damage. Additional purchased flood insurance is essential; most of the over $10 billion in disaster loans made by the SBA after last year's Gulf Coast hurricanes were for flood damages.

The National Flood Insurance program provides coverage to property owners. For more information, visit the Web site at http://www.floodsmart.gov/floodsmart/. Flood insurance must be purchased 30 days before the disaster hits to be in effect.

Avoiding a Financial Crisis: How to Keep Your Small Business Alive

2009-04-02T11:12:00.001-06:00

Having a superb product, soaring sales and stupendous customer service are undoubtedly some of the things which go into making a successful business. But all of this is irrelevant if you suffer a financial crisis. Without a sound stable financial position the slightest shock can be enough to send your business crashing to the ground.

So what can you do to ensure that all your hard work is not in vain? What can you do to make sure that a financial crisis doesn’t rock the boat or even sink it? Let’s take a look at what can cause these jolts and, more importantly, what you can do about it.

Poor Record Keeping and Administration

Business owners are usually not good record or bookkeepers! People who start businesses are the ones who have great ideas, see a gap in the market or have the personality to sell anything. They are not people who jump out of bed in the morning and say “Great, it’s a VAT and paperwork day today!”

If you are to keep your business on the straight and narrow then you have to accept that there are going to days like this; you can’t avoid it. You must keep records of your sales, your purchases, how much you have, how much raw material or finished goods you hold.

Without these records you will very quickly lose track of where you are. You won’t know:

• What you have spent your money on

• You won’t know where your cash is going

• You won’t know where all your stock is – has someone stolen it? Who knows?
You are effectively working in the dark and this is not conducive to financial stability. So what sort of records are we talking about? Nothing sophisticated. It can be as simple as a book with one page for your income and another for your expenditure. At least once a month total it all up to see how money you have made (I hope!). There’s a saying. ‘The people who keep records are the people who break records’ – so true.

Not Watching Your Bank Balance

Do you know exactly what your bank balance is today? Why is it important? Because if you are going to write a cheque you must know whether you have the money on your account. If you don’t that nasty Bank Manager may just bounce it.

Obviously this can have a negative effect on your reputation; your credit will be damaged and you may struggle to get support from your Bank and suppliers in the future. All because you didn’t check what your balance was.

To avoid this make sure you keep a running total in a cash book of what you have on your account. Why not sign up for Internet Banking? These days all the High Street Banks make this facility available, so there is no excuse for losing track of where you stand.

Poor Cash and Credit Management

Closely linked to keeping an eye on your Bank balance is how you handle your cash flow. There are 3 aspects to this.

1. Don’t be tempted to keep too much at your home or on your business premises. You could lose it to thieves, fire or flood

2. If you are doing ‘business-to-business’ sales then you may be faced with having to sell on credit. If so then be disciplined in chasing up any outstanding payments. You can’t afford to be embarrassed about asking for a cheque. If you have agreed 1 month credit, why wait for 3 months? Chase as hard as you can because remember you have your own debts to pay!

3. You may be lucky to have a period of credit granted by the people you buy from. If they give you one month’s credit, then stick to it. If you decide to hold onto your bills before paying you may be faced with a Solicitor’s letter. Don’t ignore the problem and hope the phone calls will go away - they won’t!

No Cost Controls

To keep yourself in a strong financial position shop around for purchases you have to make. Compare prices and specifications. Have an upper limit beyond which you will not pay. Always be on the lookout for a good deal.

Spending On the Wrong Things

Running your own business can be a very powerful feeling! You may be tempted to spend on anything but the business – a new car, flash clothes, a new kitchen. Well, you have to look the part don’t you??

During the early years and even when you are established make sure you spend your hard earned cash on the right things. The trappings of success may not be right at this stage of your business life. Your business, in order for it to grow, needs cash. Remove the cash and you remove the life blood which keeps your business alive.
You have to be disciplined in your expenditure and ask yourself the question, ‘Will this cost add anything to my business?’. Don’t act on impulse; go away and think about every large expenditure. If the answer to the question is no, then you should think twice about spending.

Failing To Make Cuts in Time

Failing to make the necessary cuts to ensure the survival of your business is something you cannot afford to do. If you spot you have a problem do something about it! Don’t sit back and hope things will get better; the chances are it won’t.

If you have product or service which is not performing and it’s costing you money don’t try and dress it up – be ruthless and cut it out. Make your decision quickly; don’t hang about. Not acting fast will only compound the problem.

Depending On a Small Number of Customers

Having a small number of customers is not a problem when everything is going well, but if one or two leave you or fail to pay up on time, then this can cause problems.
If you depend on 3 customers and one of them leaves then you are faced with a 33% reduction in sales. Unless you can replace him immediately you may not be able to cut your overheads quick enough to avert any crisis.

You cannot afford for your business to be held to ransom. Try and diversify as much as you can. Get out there and get new customers.
The same applies to businesses which rely on only one or two products. A shift in public tastes can leave you high and dry with unsold stock and no business!

Not Having a Budget

One good financial discipline is to have a budget. At the beginning of each year sit down and, based on your previous year’s income and expenditure, set new targets. Look to see where you can cut back in expenditure or even what to cut out all together.

Armed with your budget you will have a guide to work to. This will be a second check before you make any large unnecessary purchases.

Having a budget will provide discipline to your expenditure. At the end of every month up date it by including your actual income and expenditure then compare your budget with the actuals. Going through this exercise will give you more focus and what your business is doing. It can help you put things right by highlighting the problem areas.

No Contingency Plan In Place

Bigger businesses need to have a contingency plan for all parts of the business. A contingency plan is basically a plan which answers the question, “What would we do if this happened …?”

What is your “if”? What if you lose your premises? What if your computer goes down?
For a small business the biggest risk is you! What would happen to your business if you fall ill or even die? Most small businesses are totally dependent on the owner. You do everything!

If you are ill enough for one or two months that you can’t work who will see to the customers? Who will get new ones? Who will see to the paperwork? Who will collect the money owed to you?

These are important questions you must answer now. You have to identify someone who could fill in for you if you are to avoid a potential financial crisis. Your next step is to write a manual on how your business works, and outlining all the key processes. If something does happen then at least there is a path to follow!

Not Talking To Your Bank Manager

As soon as most people see a financial crisis looming the person they try and avoid most is their Bank Manager! If they see him walking on the same side of the road they will cross to avoid bumping into him.

The Bank Manager is usually the first person you should speak to. Bank Managers like to be kept up to date with what is happening in your business. They don’t like surprises. It’s when they are kept in the dark they make decisions that can have a major impact on your business.

You must resolve to talk to your Bank Manager the moment you suspect there is a problem. Who knows, he may surprise you by offering to do something to help!

Financial problems can usually be avoided by taking a step back from the business and thinking about what can go wrong. Once you know that, then you can take actions to put preventative measures in place before it’s too late.

Are You Thinking Too Small and Dooming Your Small Business To Failure?

2009-03-31T10:02:00.000-06:00

One problem that many small business owners run into is simply thinking too small. I often have readers writing to me asking for helping getting their business ideas off the ground. I also often hear from folks who have run their small businesses into the ground. There are five key areas where you can think too small -- and doom your business to failure.

Niche Too Small

Is your niche too small? Finding a small market to target with your business is key to success, but sometimes people narrow their niche too much. While doggy dental products could be a wonderful niche (as almost any dog owner can attest) you could even narrow your focus down to a certain type of dog (such as lap dogs) but going for one specific breed would be taking it too far.

Target Market Too Small

Is your target market too small? If you are looking only at one community or small geographic region then you may well doom your product to failure. It is far too easy to saturate a small market and it is far too easy for any marketing mistakes to end your campaign before it gets off the ground. In today's economy with the availability of global marketing you need to think big when you are planning your target market.

Budget Too Small

Is your budget too small? You don't need a million dollar advertising budget but you should have some seed money to get your business and its marketing campaign off the ground. It is possible to build a business from nothing but it is also a lot more difficult and you might find yourself making some mistakes that cost you a lot more down the road than putting a little money up front.

Schedule Too Small

Is your schedule too small? Do you have enough time to devote to your business? Starting, running, and growing a business takes time. Some people get swept up in the planning and dreaming stages and never really start their business. Other people start before they have completely planned everything out and quickly get mired down by unexpected difficulties. While others do everything right in the planning and start-up but once the business is running they get overwhelmed by day-to-day business and never think about ways to improve and grow their business.

Mind Too Small

Is your mind too small? You need to open up your mind's eye to continually seek new opportunities to find new customers, to find new potential partners, to find new ideas for products, and to find new opportunities for marketing. Flexibility and adaptability are key to survival in today's business climate and you always need to have new ideas cooking to grow and expand your market and your business. This means raising your head up out of the trenches once in a while. Yes, you might need to dodge the occasional missile lobbed your way but this is the only way to see those opportunities heading your way.

If you do your best to avoid these five not-so-small mistakes then you will be on your way to small business success.

Are You Ready to Outsource Your Bookkeeping?

2009-03-29T15:17:00.000-06:00

Do you run your own small business and try to do it all yourself? Why? Shouldn’t you spend your time doing what you do best- whether it is selling and marketing, customer service or making decisions on how to grow your business?

An entrepreneur tries to juggle many balls each day, but sooner or later one of them is going to be dropped. A smart business owner will realize that he/she can’t do everything because there are only 24 hours in a day. Unless you are extremely organized and enjoy working with numbers, then maybe you need to outsource this job. Too many business owners spend their time doing what they are not very good at simply because they don’t know how to go about finding someone to do that job for them.

Where do you start? Ask your accountant for referrals. Obviously you don’t need a full-time person to do your books, so your best bet is to look for someone who wants to moonlight at a part-time job. There are also bookkeepers with their own small business who are looking for clients. If you don’t have any other employees, this situation will work best for you because you can pay them as a subcontractor instead of an employee on payroll. However, you will need to give them a Form 1099 at year end for tax purposes. But, since they are accounting experts, they can help you with that task too.

You should interview your prospective bookkeeper just as you would if you were hiring him/her as an employee. Ask for a resume and references, and check them out. Since this person will be handling your confidential records, you want someone who is trustworthy.

Depending on your location, you should expect to pay between $15 and $50 an hour for a bookkeeper. Don’t necessarily hire the one who offers the lowest rate- remember you get what you pay for. The more experienced person will cost you more, but will provide valuable input and suggestions to streamline your business that will wind up saving you money in the long run.

Since this person will be working closely with you in your business, you should feel comfortable with him or her. If you have any reservations about this person, go on to the next candidate.

While the selection process may take a while, it will be worth it later. Take your time to find the perfect bookkeeper, and in a few months you’ll wonder how you ever managed to run your business before you hired one.

Are you living the Greatest Lie?

2009-03-25T09:30:00.000-06:00

Have you ever felt that your life was a conveyor belt of ….

Go to school, graduate, get a good job with a good company, accumulate retirement savings, and use these to do everything you’d ever wanted to during your retirement?

If that’s what you’ve grown up expecting you may be in for a big surprise. Only 5 people in 100 who follow this route can look forward to a comfortable retirement. Are you shocked?

That means a whopping 95 out of 100 hardworking people who try to follow this route are going to have to rely on inadequate pensions, social security, and family assistance to live out their golden years. Not a happy picture.

Just take a look in your community to see how few retirees are financially independent. If you know any that are truly financially independent then you’ll probably find they did it on their own.

So, if you want to want financial independence what are your options?

You could pray that you’ll be one of the 1 in 180 million people who hits the lottery or you could inherit a fortune when your aged maiden aunt checks out. Another way could be a life of crime, but I warn you that your chances of reaching retirement age, let alone enjoying it, are really slim.

In reality there’s just one way you can ever be financially independent..

You have to do it on your own.

I’ve just read some fascinating statistics about age and self-employment:

“According to recent studies 22 percent of men and 14 percent of women over 65 are self-employed. That’s compared to just 7 percent for other age groups. According to a Vanderbilt University study the number of entrepreneurs in the USA age 45 to 64 will grow by 15 million by 2006. That’s compared to a 4 million decline for entrepreneurs age 25 to 44.”

And: “Self-employment among American workers increases with age, with the most dramatic jump occurring at age 65.”

Don’t worry help is at hand. With the advent of the Internet there’s a whole new world out there, and, most importantly, it’s a level playing field. (Finally I can say it…Size doesn’t count). There are more than 500 million consumers out there and with a good plan, you can learn to build your financial independence with your own online business.

Before you say “I can’t do it” let’s chuck out some of the most common reasons people give for not wanting to start an online business:

Objection #1: I'm not smart enough to have my own business.

This is unlikely to be true. Successful businesses are run by people with vastly different capabilities. Running your own business is about solving people’s problems and not about how smart you are.

Objection #2: I don't have the time it takes to start or grow an income source online.

Unless you’re already working 80 hours a week, you can probably find time to start building an online business. You’ll probably need to find 2 hours a day (14 hours a week) to successfully build your business. (Not too much is it?). It’s really all about organizing your time. How about using your commuting time to record ideas for a business?

Objection #3: I don't have the money it takes for a new business.

The cost of starting your online business needn’t be expensive – certainly less than starting a real world business. I’ve managed to get going for about $500, but believe I have wasted some of that.

Objection #4: I'm not an expert at anything.

No matter what your background there’s probably something you know that somebody else doesn’t. That makes you an expert to the other person. Just do some research and before long you’ll find that there’s something that you can teach others.

Objection #5: I have nothing to sell.

There are two parts to an online business a product and people wanting that product. You can sell other peoples products (just like real world) if you know what people want.

Objection #6: Someone is already doing what I want to do so it is useless trying to compete.

Of course other people are already doing the same thing but that’s true in the real world too. Just do it better. If there aren’t others doing the same thing you probably can’t make money out of it. Competition shows that there is a market for your product/idea.

Objection #7: The only people making money are people telling others how to make money.

When you start on the Internet Marketing route you’re desperate for information and in finding it you sign up with everyone offering to help you – these are the guys (and girls) offering their services as business advisers. They are not the only businesses on the ‘Net but they are the ones you’ll come into contact with first.

Objection #8: I've tried plenty of business opportunities with no success -- it's just not for me.

Maybe it's not, but chances are, your failure is from chasing different business opportunities, instead of building your own business from the ground up.

Objection #9: I'd need a top search engine ranking to get anywhere and that's almost impossible.

Search engine positioning is not the be all and end all. There are other ways to find traffic and customers.

Objection #10: I'd need a big advertising budget to get any results.

That’s simply not true, the ‘Net is the perfect place to do business with a small budget.

The greatest lie out there today is that, if you get a good job and slave away for 40 something years, your retirement years will be golden.

Are You Getting The Most Out Of Your Database?

2009-03-23T09:34:00.000-06:00

Imagine how much simpler your life would be if you had all your business contacts together in one place. One click of your mouse would reveal how effective your latest marketing campaign has been. Know at a glance which of your products/services is the most profitable.

Your custom-designed database will put this information right at your fingertips. Today, I'd like to share with you my tips for ensuring that your database gives you the business information you need, when you need it!

What is a database?
A database is a collection of information relating to a particular topic kept together in one place, for you to access whenever you need. You can use a database to simplify your:

MARKETING CAMPAIGN--set up a database to plan your marketing campaign; track results of your marketing campaign; or analyse trends in your marketing campaign.

CLIENT & CONTACT MANAGEMENT--set up a database to keep track of your clients and contacts; analyse your business--which products/services are the most profitable; or see which clients are buying which product/service.

FINANCIAL MANAGEMENT--set up a database to keep track of your spending; manage your invoices to clients; or monitor overdue invoices.

MEMBERSHIP ORGANIZATIONS--set up a database to keep track of members; send out membership renewal letters; or monitor subscriptions.

Your list for database uses will likely be much longer--just brainstorm a list of all the places where consolidated information would make your life easier!

The secret's in the planning
You want to get the most out of your database, right? Then make sure to plan it right from the start.

Before you go running off to set up your database you need to ask yourself these important questions:

::What do you want to use your database for?
::What data do you want to keep track of?
::Who will be collecting the data?
::How much data is there to collect--50 records or 500 records?
::Who will be doing the updates?
::What reports do you want your database to generate?

You may find it easiest to map this out on a piece of paper first. Work out how your database is going to fit together. How will each category relate to the others?

Get the maximum use out of your database:
By now, you've invested a lot of time in your database plans, design, and setup. Don't miss this important step: getting the most out of your creation.

First, you'll want to make the database as easy to use as possible. Create one-click touches to produce the information you need. Set up shortcuts so you can create the most important reports quickly. And make sure you really consider the easiest way to enter new data.

By applying this advice in your own database, yours will be easy to use AND have the maximum use value to you!

An Easy Way To Make Your Small Business More Visible-For Free

2009-03-17T10:52:00.000-06:00

No two small businesses are alike, but most want to be like their larger counterparts in some key respects. For example, even if you own a company with only a few really great customers, you want to be visible enough to attract new customers, boost your odds of securing repeat business and do all you can to improve customer satisfaction.

The key, according to the U.S. Small Business Administration (SBA), is having a business Web site. The SBA's own Web site notes that the Web "levels the playing field between small business and big business" because it is such a dynamic, inexpensive medium for advertising and customer service. "The Internet is making it possible for small- to medium-sized businesses to compete with the big guys," the SBA said.

Conventional wisdom says that any business without a Web presence these days is at a distinct disadvantage, but the latest International Data Corporation (IDC) small-business research exposes a surprising gap. The IDC research found that of the 6.8 million businesses in the United States with fewer than 10 employees, only 3.8 million have a Web site. "That means 3 million U.S. small businesses-or 44 percent of the total-aren't using the Internet to promote themselves online or engage customers and prospects," said Ray Boggs, vice president of Small/ Medium Business and Home Office Research at IDC. "In today's connected world, companies that take that step generally find that having their own Web site can deliver a significant opportunity to grow their business, especially if the site is updated regularly."

Clearly, small businesses (and many of their customers) are online, yet more than half aren't exploiting the full power of what the Internet can do to help build their business. That power includes creating a dynamic Web site to attract and retain customers, taking advantage of search engines to heighten awareness of a company in today's global marketplace, and communicating with customers around the clock or at their convenience.

What stops small businesses from stepping up to this level? For many, the barriers are cost, complexity and inconvenience. By its nature, a small business typically has a small budget and an equally small staff. Unlike the larger companies it competes with, a small business generally can't afford to spend thousands of dollars to buy a server, create a complicated infrastructure and hire an IT technician to keep it all running smoothly.

The good news is that some new offerings are cropping up that allow you to establish a Web presence without heavy-duty in-house technical resources and a big cash outlay. For example, Microsoft Corp. has a new Internet-based service called Microsoft Office Live, which at the most basic level provides a small business with a domain name, e-mail accounts and a Web site for free.* It's one of the quickest and easiest ways today to get your business on the Internet. And, because it's supported by advertising revenue, and the advertising is designed to be unobtrusive and not appear in the customer's public-facing Web sites, the basic offering is free. Yes, it's free, and you can sign up to test-drive the service at http://www.officelive.com.

With such an all-in-one solution, a small-business Web site really is a no-brainer. Look at it this way: In a day and age when the majority of Americans use the Internet regularly, it's highly likely that a large percentage of your customers do, too.

Advantages of Inventory reconciliation Management

2009-03-11T08:54:00.000-06:00

Inventory management refers to the procedure of organization the stocks of finished products and supplies by a compact. Inventory management, if done accurately, can transport down expenses and increase the profits of a compact.

Not a substance what the business size it must administer many fixed assets, types of assets, quickly changing asset bases, many locations, and ever-changing tax laws and requirements. Fixed asset inventory software can also reduce encumber of fixed asset reduction calculations for financial and tax exposure, asset inventory tracking and reconciliation services, and private property tax filings.

Inventory management software has an amplified business on the web, following the importunate increase and achievement of e-commerce. Inventory management software helps administer inventory from any location in the world. Inventory management software is perfect for business. Inventory management software correspondences are designed for inventory control. The software makes easy the making of an account, and inventory control, stock balance management, goods item direction. Our Accounting Services, a company leader in this area of specialty, can provide to the demanding supplies of global customers in Inventory management.

Inventory management software solution packages:

QuickBooks

Peachtree

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Quicken

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Pro Tax

Inventory software can create the assignment of fixed asset managing easier from achievement through removal. Software such as this eliminates superfluous data entry, enhances accurateness, and reduces costs over handbook tracking of fixed assets. There is inventory software accessible from the essential system of normal barcodes to the more complicated long range asset management. Some business offer inventory software on the internet. As well there are businesses for appoint that will approach. Using complicated devices for gathering of data, our inventory management team captures asset attributes professionally at the point of entry. This ensures benefit information in detail, and accurateness.

All-in-one folder production companies effective for businesses: big or small

2009-03-04T08:41:00.000-07:00

Working in an office environment makes the effectiveness of proper office supplies important. Whether a business is large or small, printing folders for presentations can be done in a cost effective manner. However, most companies make large quantities price cuts, which often has smaller businesses buying less so to stay on budget. While working for myself, the need for small runs of professional looking products is vital to my success.

When shopping for a printing company, I discovered that most often these other printers produce folders on low-quality stock that creases easily, leaving them looking non-professional. Some companies even have you doing some do it yourself assembly, which adds to the overall time frame of the work. However, one company seems to fit the mold to avoid all of these disadvantages for companies and offers an added bonus --- free business cards.

With their help, cost-effective projects are completed, which promote the products and services of your company. They often are the proper solution for your printing problems, while being printed on 350gsm silk stock. In addition, all the assembly is done when you receive the job. Each folder includes a spot to place your business card, which adds to the overall professionalism involved with the folders.

The quantity you need will be printed --- no minimum quantity orders are processed. Designs are also available to be created in case you do not have in-house designers or just don’t have the time to put into it. A team of creative, talented and professional designers will create a design to fit your professional needs. Often times, printing projects are a stressful task for businesses. By leaving it to the printing company to design, print and assembly, businesses can relieve themselves of the stress involved with this work.

Most wonder how one company can work this way while others require minimum runs that most often discourage small businesses from doing business with them. However, with this work ethic, maximum efficiency occurs and overall customer satisfaction occurs. With professional presses, high quality prints are created even on low runs and leaves me satisfied with every order.

Overall customer satisfaction is important. When ordering because of their PDF workflow ethic, I was able to receive proofs of my design before it was printed. This added to my overall satisfaction with the company. Overall, with keeping all businesses in mind, the future success of their work will be continued to supply professional looking products for its customers – big or small.

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2009-02-25T06:03:00.002-07:00

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Accounts Receivable Factoring - A Viable Cash-flow Solution for Small and Medium-Sized Enterprises

2009-02-18T10:23:00.000-07:00

The pace of change in today’s business environment is inarguably staggering. Growth of e-commerce; changes to business structures; evolving relationships; changes to funding arrangements; access to capital and its sources. All occurring at increasingly exponential rates. Fast. The fact that there is more computing power in the average notebook computer today than it took to put a man on the moon should illustrate how fast things change, and whether in senior management or a business owner you need to keep pace.

In particular, you must stay abreast of changes in your competitive environment, and remain fully apprised of mechanisms that will enable a response fast enough to keep you in the game. This article will look at one of those mechanisms, access to capital and through that, free cash flow. In doing so we’ll use an intuitive framework, peppered with some economics. Why? Intuitive analysis is ideal for answering specific questions; in this case ‘What will best enable my firm to manage rapid changes to competitive economic conditions and stay in the game?’ And I’ll use economics because of Steven Levitt, America’s most outstanding economist under-40, who along with Stephen Dubner considers that ‘if morality represents how we would like the world to work, then economics represents how it actually does work.’

By speaking to specific anchor points, strategic issues affecting the access to capital problem can be explored and initiatives developed to allow a timely solution. In short, it’s the fastest and most accurate way to answer the question you face, because it’s easier to understand and doesn’t get bogged down in extraneous, unnecessary analysis.

One of the anchor points in contemporary business is access to capital, especially when it helps maintain free cash-flow. In many respects they are one and the same thing, the difference merely being access to capital is a necessary precursor to free cash flow (you can’t use it until you have it). And everyone needs it. Payroll, materials, overhead, and debtors taking anywhere from 45 to 120 days to settle their accounts, using your firm as a surrogate line of credit.

Access to capital becomes an even larger issue in the business environment described earlier, where speed to market and the ability to ‘tool-up’ (increase production) are crucial to meeting ever shrinking delivery timelines. Many of us have experienced the elation of being awarded a large tender, something that will fill the order book for the next six months, immediately followed by the hangover that comes with the realization that the firm will struggle to fund the project based on existing and forecast cash flow.

Small-to-medium enterprises encounter particular problems when it comes to cash flow and capital access to fund growing operations, to the point where lack of access is an issue that can threaten continuing operations, even in a rising market. Balance sheets take time to build, and it is against this security that banks will lend.

Developing initiatives to tackle this problem involves looking at some existing options and making a comparison, arriving at a decision that best enables a solution to the problem at hand. In this instance, a comparison of bank funding against invoice factoring provides insight into possible solutions for the capital access / cash flow problem.

Everyday economics can inform this comparison, particularly the study of incentives - how people get what they want, or need, especially when other people want or need the same thing. Let’s start with banks.

Bank lending requirements are invasive and restrictive. They often engender a feeling that you have to ‘bare all’ to borrow a nickel. They would naturally dispute this claim, but let’s return to the incentives – what is their incentive for lending you money? To earn a return off your efforts. Certainly nothing short of this, and these days they also use lending as a lever to win the biggest ‘share of your wallet’ from their rivals, trying to have you as a customer for life, ‘growing with you and your business.’ When you add the fact that a surplus of people requiring credit exist in the market, they can afford to be choosy and do the economically rational thing – be risk averse. Risk aversion drives the mortgage a bank puts on your house to ensure they get paid, and is what drives them to lend against strong balance sheets. They look at balance sheets in an accounting fashion, weighing up tangible, realizable, liquid assets like cash and real property, apply a formula and lend in accordance with how the result stack up against their risk matrix. Your continuing success is of interest to them only to the extent that it enables you to service (and ultimately repay) your debt, generating an ongoing margin on their investment.

An overly simplistic description, the point being to illustrate that all of this takes time, and is structured around heavy regulation and evaluation constraints. Lots of time, and lots of influential rules. First, for you to build your balance sheet, and second, to get it appraised to a point where your banker might open or extend your credit facility. During that time, the window of opportunity to fund that large project, manufacturing expansion, or operations in a rising market quickly passes, leaving you out of pocket your application fee and if successful, servicing an even larger debt you might not need.

Turning to invoice factors, the incentives might seem the same, but how they view obtaining their return is slightly different. While banks rely on their acumen in accurately predicting your ability to repay a debt, invoice factors rely on their skills in accurately assessing the ability of your customer base to pay you. A lower perceived risk aversion with invoice factors plays a small part, but it is how the factor views the overall situation that is different from traditional lending. To begin with, factors recognize your accounts receivables as assets, just like the bank. The difference is that an invoice factor considers your receivables a quickly realizable asset, and is prepared to purchase the rights (and risks) of collecting your outstanding invoices.

Put another way, in economic terms the invoice factor recognizes your receivables as assets with a future value in cash flow terms, and provided their assessment of your customers is favorable, they are prepared to effectively ‘provide a market’ for those assets. This ‘market’ closes with your transaction selling them the invoice however; there is no secondary market like junk bonds or other derivatives.

Access to capital through factors is more expensive than traditional lending, and this is due to the risk premium attached not to you, but your customer base. This is not surprising, and you and I would probably do the same. Returning again to economics and our study of incentives, a rational person requires a premium for every extra unit of risk they take on. A bigger incentive for a perceived higher risk. In the case of factoring, the premium is higher than equivalent bank lending rates, as the risks are considered slightly higher when the security is not real property, rather a first position claim over all of your receivables. Your risk exposure is lower than collecting the receivables yourself (invoice factors are very good at mercantile operations) – the higher fee charged by the factor compared to the bank is simply the premium you must pay to lower that exposure.

The difference that factors provide is speed of access to capital, and what happens when you default. Default on the bank loan, you can lose your business, even the family home. Factoring is not quite as drastic, although the sums of money involved are invariably smaller. There are two types of factoring products available, recourse and non-recourse, and again, the difference comes down to assumption of risk, and the premium asked to assume the risk of non-payment on an invoice. With recourse factoring, you remain liable for non-payment by your customer, and with non-recourse, the factor assumes the risk up to a point, and at a higher premium.

In summary, there are merits and pitfalls in both traditional lending and factoring. These are volatile economic times, and having been burnt a number of times during boom times of the previous two decades, banks are far more risk averse, holding tight reign on their credit standards. So in light of this information, we return to our problem, looking to answer the question: ‘Which of these approaches best delivers the flexibility I require to allow me the opportunity to prosper in a fast-changing business environment?’

For many businesses, the answer lies with invoice factoring, which delivers in excess of $1 trillion in credit across the continental United States. As with all business situations there are caveats, or described another way, arrangements that if not continually monitored can become a comfortable security blanket that might actually be slowly suffocating you.

It is easy to become accustomed to continuing access to cash flow through factoring. It is also easy to feel at ease knowing you are backed by a massive publicly traded institution like your bank. Management and owners of Small and Medium-Sized Enterprises should continually remind themselves that the study of incentives works for them too. Constant review of your capital funding and cash flow arrangements is essential to ensure that the deal you end up with is the best for your firm, and not others. It’s all about getting what you want, or need, especially when other people want or need the same thing.

A small Small Business summary

2009-02-11T08:46:00.000-07:00

Small business is a term that is used day-to-day. That is because in the past decade the rise of small business has been larger than in any other decade prior. This is largely due to the increasing number of services that are available to small business owners, to enable them to keep their business running.

There really isn't any guidelines for when the term small business is used, however it is simply defined as a business which has a small number of employees. How few employees is debatable, and the definition of when a business changes from a small business to a larger corporation varies both by country and industry. This number is generally less then 100 employees.

As mentioned before small businesses due to their nature, are in most times sole proprietorships, partnerships, or privately owned. Common in many countries, small businesses, are most often related to: accountants, restaurants, guest houses, photographers, small shops, hairdressers, tradesmen, solicitors, lawyers, small-scale manufacturing etc.

Small businesses in often cases are located in private homes, for two main reasons. The first is because it is economical and in most cases convenient. The second reason is that there are several benefits with tax, etc for having your business in your home.

Running a small business is an exciting venture, and a great way to introduce yourself into the business world, and to gain business sense. If you are interested in starting your own small business, I would recommend having a talk with a local lawyer or accountant, who will be able to answer questions that are specific to your local area. Good luck with your new venture!

A Call to Action

2009-02-06T08:11:00.001-07:00

Because of a recent boom in business, my company needed to update our office phone system. We had a very nice system in place already, but our business had tripled within a matter of months. Since we rely on phone orders for the vast majority of our sales, we needed to upgrade in order to handle the increase in call volume. We were lucky to have a great relationship with our telephone equipment provider, and within days we were able to have a new system ready to put in place. It's not often that businesses find themselves in situations like this, but when they do come up, it's important to know that the companies you have chosen to do business with are capable of meeting your needs in a timely manner.

Prior to this happening, we had a trunk study performed, after which we were told that we were losing business as a result of not having a new phone system in place. Anyone who has ever run a business knows that losing money because you are ill equipped to handle your customer's needs is the worst way to lose money. Being able to make a phone call and knowing it would be taken care of quickly and efficiently was a great relief to me. I knew that with every passing day, thousands of dollars were being lost and that's something I couldn't afford to let happen. The whole situation made me think about the importance of knowing qualified vendors who can get you the products you need, when you need them.

I soon began looking into other areas where we were dependent upon other companies for goods and services to see if we were utilizing vendors who could facilitate the changes our growing business was experiencing. After a long, hard look, we decided to switch shipping companies and to switch to a new overnight call center operator. It's not that our needs weren't being met at the time, but that if things continued to grow, we would likely outpace our current vendor's ability to provide service. Being proactive in your business relationships is just as important as being proactive about your business. After all, most companies depend on other companies to make their operations run smoothly. I encourage all business owners to seek out the service providers and vendors that can handle your needs both now and in the future. When your business grows, you'll be happy you did.

15 Steps On How To Welcome Your New Employees

2009-02-04T15:12:00.002-07:00

Looking after a new employee during their first few weeks at work can mean the difference between their success and failure as employees as well as your success and failure as an employer, manager or supervisor.

Proper orientation determines how fast the new employee can be productive and efficient in his or her new job while giving you a good opportunity to make your new employee an efficient part of your team.

Below are 15 suggestions that will help you deal with your new employees during their first few weeks to help make sure that they get started on the right track.

1. Have a induction policy for welcoming and training new employees. Don't just leave it to whoever is available. Human resources should cover the HR side of the induction with a trainer (if you have one) or a senior manager or supervisor covering the more hands on part of the job. Either way the following is a minimum of what is required.

2. Give your employee a warm welcome. Don't just point them to the area they work and let them get on with it. Nothing makes a new employee feel comfortable more than a warm welcome.

3. Give them a brief description about your role as a supervisor. Knowing who's in charge and what you expect from them will make them more comfortable with you as the boss.

4. Give your new employee a welcome tour of the whole department or, if the site isn't too big, the whole site. Make sure they know how to get to the bathroom, emergency exits, cafeteria, etc.

5. Give them a brief summary about the company, its history as well as its mission and objectives.

6. If possible demonstrate your company’s products and/or services, paying particular attention to the products relating to the area in which the employee will work. This will make them more secure and confident with the work that they are going to be doing.

7. Explain to your new employee how the company works particularly if the company has any unusual working practices or a different structure than the norm. Again, this will help familiarize them with the company.

8. Tell your new employee about the company’s competitors and what is being done to make sure that the company is staying ahead of the competition.

9. Explain in detail your new employee’s responsibilities and describe their job functions. Don't leave it to the other employees to teach them the basics unless there is a trained member of staff whose job it is.

10. Let your new employee be aware of what you and the company expect from them. This includes proper work ethics, productivity, teamwork, and appearance.

11. Explain the specific conditions and requirements of employment, including hours, pay, pay periods, holiday pay, sickness provisions, pension, medical benefits, lateness etc.

12. Be very clear about the safety rules, policies, procedures and regulations. Explain and show proper use of safety devices.

13. Introduce your new employee to his or her co workers along with a brief description of their jobs and responsibilities.

14. Outline opportunities for promotions and other opportunities.

15. To give them time to acclimatize give them a work buddy, a friendly experienced worker, to show them the job and work with them for the first week of two.

Covering all of these basics will help new employees settle in and they will be able to be contribute much more quickly compared to employees that are just left to their own devices.

10 Ways To Reduce Tax Burden For Your Small Business

2009-01-30T11:27:00.000-07:00

An ideal lawyer will not just have a string of impressive credentials or gold lettering on his door. He or she will be caring, concerned, and devoted to their work. You need to think carefully before laying your trust in a lawyer after all in some cases your life, future, money or property will be in his hands.

Apart from doing extensive research to short list possible lawyers you must ensure that there is not conflict of interest, that you understand everything the retainer agreement states, and that you have checked the references and details regarding the practice.

You will know the lawyer you have chosen is the perfect one if:

1. He makes an effort to spend time to understand your case himself. He will not assign a legal assistant to take facts of the case down.

2. From experience and knowledge he will know what is relevant and what is not. He will set aside and ignore irrelevant facts, opinions, and personal emotions that cloud the case on hand.

3. He will insist that the footwork for the case be done thoroughly. All facts must be checked for accuracy and solid arguments jotted down with backing of earlier rulings.

4. He will not just focus on the problem at hand but examine the problem from all sides. This will create a complete picture highlighting all factors of relevance and the different ways one can approach the case.

5. He will use his foresight and anticipate moves by the opposition or opinions of the jury or judge and plan way ahead. Like a master chess player he will plan the case not by the day but by many hearings ahead.

6. He will not waste time beating around the bush or create verbose statements—many words strung together which look impressive but mean nothing. He will insist that the case and its arguments be clearly stated.

7. He will be self-disciplined, thorough, and self confident. Courteous at all times he will respect you as well as all the staff who work for him.

8. He is recommended by not just his friends and relatives but by other professionals of good standing and from his field.

9. He will not just present to you his victories but be happy to tell you why and how he lost certain cases.

10. He will lay the cards on the table and tell you clearly whether your case stands to win or loose. He will not claim that winning is guaranteed. He will be honest and upfront about his opinions and advice.

The bottom line is that the lawyer must be worthy of your trust. Use your inborn instincts and don’t go by the lawyer’s good looks or fancy car or office. After all it is competence in law and in court that is of essence to you.

Everyone worries about taxes and looks for ways and means of reducing the tax burden. When you have a small business of your own you must up date your knowledge of tax laws that pertain to “small businesses.” As a business owner you must understand clearly about accounting systems and tax planning. Sit down with your accountant and plan on ways of maintaining business expenses, filing receipts, planning on “tax saving” investments, and a strategy for running the business in the most beneficial way.

Did you know that:

1. According to law you can reduce your tax liability by hiring family members to carry out work in your business. Pay your children and spouse to perform assigned duties. This way you can shift from higher tax rates to lower ones.

2. Consider hiring independent contractors instead of employees. You will save on payroll taxes. However ensure that you meet the IRS’s criteria.

3. Think about “deferring income” postpone receiving money to January instead of December. This means that payments received will be up for “tax” calculations a year away. However ask your accountant’s advice as the benefits are dependant on profit and losses for the year and your corporate legal structure.

4. Take advantage of tax deductions allowed for charitable donations. Make donations in November or December instead of January so that you can include the donations for tax deductions in the current year.

5. Maximize your expenditure on equipment and office supplies. Buy in advance for a quarter and use the tax deductions allowed in the current fiscal year.

6. Include expenses of business related travel in the current year.

7. Pay all bills due before the end of the year. Payment to cell services, rent, insurance, and utilities related to the business can be included for accounting and applicable tax waivers.

8. Plan a retirement plan and make payments before the end of the year. This will reduce your income for the year and proportionately the tax due. Be sure to check on the limits. Plan a feasible and beneficial strategy with your accountant.

9. Be sure to deduct from your taxable income money paid to licensing fees, businesses taxes, and annual memberships to businesses related organizations. Be sure to deduct interest paid on borrowings for running the business and related fees. Insurance premiums paid to insure the business office and machinery are eligible for tax deductions. Make a list of your memberships and check which ones are eligible for tax deductions.

10. Check whether you have deducted management and administration expenses as well as money spent on maintenance and repairs of equipment.

Decide whether a cash accounting system or accrual one will benefit your business. The tax deductions are different depending on the system you use. When setting up your small business take the advice of a tax and accounting professional as to which accounting system would be most suitable.

8 Important Elements for Small Business Web Sites

2009-01-27T08:25:00.000-07:00

Key visitors to your commercial pages include web robots that crawl the internet and catalog your content. Having proper HTML source code, plus the right combination of text and graphic presentation, is just one secret to success. Proper code may mean higher robot ratings, and the "look" is equally important. Once a new prospect finds your web site, you have 5 seconds to get them to stay.

As a small business web site owner, you may have asked "Why don't we get any hits?". Did you know web pages can load and appear correct with improper or deprecated HTML code? A browser may ignore your mistakes, and display what it thinks you meant, and it may look great. Web robots may not be as forgiving.

Following is a list of 8 basic elements for good search engine placement that need to be considered in your design and web site promotion. For details on code issues from the worldwide authority, visit the World Wide Web Consortium to view DOCTYPE and other quality standards.

1. DOCTYPE Statement
2. Page Title
3. Proper HTML Code
4. META Description
5. META Key Words
6. First Paragraph of the Home Page
7. An Extra Page of Just LINKS
8. Backlinks (Links to your pages)

These 8 key items are either missing or poorly designed in 85% of all web sites. Some search engines may only list the other 15% in their directories. In other words, as few as 15% of the 6 billion web pages online ever make it into some search engines. Even worse, there are mistakes that may result in your page being blacklisted, and the search engine web crawlers may never come back to see if it's corrected. This could explain why you "never get any hits".

Web sites can be simple and professional without using fancy software to create your pages. Veteran programmers hand code and many create the HTML in NotePad. Web authors who choose to use flash, frames, or the latest software may be losing a significant portion of new visitors (customers) because the visitor may lack the technology or newest version of browsers. If they are turned off and leave without giving your site a fair viewing, it could mean lost profits.

Most designers use prepackaged software to create web pages. If the software leaves out any of the key elements, the code is hidden, and you'll never know your site was not optimized for search engines. The designer may not know, or care, about these items as long as the page looks attractive. Note: Search engine algorithms vary by company, so some elements such as "an extra page of links" may not be as important today with some search robots. Backlinks refer to marketing your site and getting other web sites to link to yours.

Finally, business visitors want information. They do not visit your home page to be entertained. Most have a need (problem) and want a fast answer (solution), so designs should be created to minimize the use of music or video unless that's your core business. Anything that distracts from a positive first impression may violate my "5 Second Rule".

8 BIG Small Business Mistakes

2009-01-23T08:09:00.001-07:00

Here’s an interesting notion: Do you realize that there are mistakes you can make at various stages of your business’ growth that can be slowly killing it for months or even years if you don’t watch for them?

Well, these mistakes do exist and they are not just reserved for the rookie companies. Many working businesses, including those you might think are “successful” because they’ve been around for 10+ years, are often still making them… and are possibly losing a lot of money and/or wasting a lot of time in the process.

Although some of these big and sneaky mistakes seem aimed more at service type companies, they really do fit the bill for almost any type of industry. I’ve done my best with the listings below to give examples to prove it.

Underestimating Project/Service Time- This is a big one and it pertains to service companies as well as companies that sell a product. This is a service company’s bread and butter. If you don’t estimate your time to perform each and every service in your repertoire, you will get burned and there is little you can do about it but bite the bullet and learn from it. The best way to estimate time is to do it once yourself or watch your best employee do the task and then throw in a little fudge factor on top of it. For product companies, time becomes an issue with logistics so be aware!

Not Knowing YOUR Company Numbers/Incorrectly Setting Prices- Notice I emphasized the word “your”. It’s a common mistake to use a competitor’s as your pricing gauge without actually knowing why they use those numbers. Think about the nightmare you will get yourself into if you take a competitor’s price, cut it by 10% and then start selling. What if the competition has a bad pricing structure and is barely making money or even losing money?!?! What if your costs are more than theirs?!?! You can use competitor as a starting point but you can’t base your whole strategy on it.

Different industries have their own variables as far as costs go and you need to be aware of them for your project or product pricing. What you pay for a product you are going to sell is not the only cost to have in your head when you are pricing products. How much your labor and materials cost for a service is only a piece of an hourly rate. Employees cost more than just salary and not every employee is part of your labor cost. Every company has insurance to pay for. There are tons of overhead expenditures that need to be part of your price. Oh, by the way, the big one that many people forget about in their price is the quality factor. What you include as “standard services” or “standard product features” as well as job site etiquette or in store service or warranties all need to go into your pricing. I’ll get to more on why in the next segment.

Not Charging for All of Your Time & Costs- This seems like a stupid statement to some but I bet most business owners will admit that they have given away a little too much of the farm at times. Hey, there is nothing wrong with giving a little extra here and there to show you care. But either way, that’s not what I’m talking about here. What concerns me are those that put a lot of quality into their work or products or stores and do not cover the cost for it. As an example, say you run a service company and your competitors don’t do a certain standard service that you do. You can’t just undercut their price to steal a job; you need to have that cost covered in your rate and advertise the fact that it comes with the price upfront. Stores undermine themselves, for example, when they put more people on the floor for customer service but don’t charge for it. These things cost you money and when your competitors don’t do them it costs them less money. Put out better service and then under price them, and your competition just has to wait a little bit for you to fall on your face so they can swoop back in.

As a business owner you need to believe that you are providing your clients worthwhile wares that deserve to be paid for. If you get the chance to explain why your prices are higher, then take that opportunity and do it. If they don’t like the fact that you include things that others charge extra for later or that you treat them better, then they are most likely completely price shoppers. You don’t want them as regular customers anyway. Trust me.

Not Getting Paid Fast Enough- That’s right, the old cash flow issue. As long as you are actually making enough money to pay the bills, this problem can be solved, prevented or at least made to be not as bad as it could be. Here’s the deal:

First off all, bill customers very promptly. It is very common for a small business to not have the procedures or systems in place to get invoices generated and out the door in a timely fashion (see the next segment for more). Again, this would seem unlikely since that’s the reason why we are doing the work- to get paid. But it is very easy for the people responsible for getting this info to the billing people to be too busy to get it there or not have enough organization to give it to them the right way.

The second part to slowing down or stopping a regular cash flow crunch is to make the quickest payment deals possible with customers and the slowest possible with vendors and employees. If there is any way not to pay employees any more than twice a month, you better do it. Contractors always have an issue with this. If you must pay weekly, then tell them before they are hired that they will be getting the first week held back, essentially buying you a week. It will help, I promise.

Part three involves credit. If your company can get a credit card, then get it. This allows for certain important things to be bought (that you can afford) that might come up during a cash flow crunch. Better yet, especially if you have no choice but to deal with 45+ day customer payments, do your best to get a company line of credit. This is a must if you plan on selling to the government or doing commercial service work. These clients often have 60 to 90 day wait periods.

Failure to Have Solid Systems and Procedures in Place- Too many procedures (known as “red tape”) is the reason why many people start their own business in the first place. Unfortunately, having no procedures and systems in place at all is not an alternative. Depending on the type of industry, business owners must come to a happy medium or chaos and the unknown will ensue. Some basic examples where procedures or systems are needed include billing, collections, payroll, hr (interviewing, hiring, vacations, benefits, job responsibilities, etc.), manufacturing, operating equipment, maintaining equipment, inventory, sales calls/visits and logistics to name a few.

Even a one person show needs to have some admin procedures in place. This will make it easier to hire temps and subcontractors and control what they are doing for you. Without at least a watered down version of a system or procedure to do everyday work, you will be to blame for causing many major headaches as your company grows. I can’t emphasize how important this is for when you bring on new employees. I’m sure you heard this before, but I am also a big proponent of having an employee handbook even for one employee. It’s amazing the trouble people can cause business owners just because they allow you to pay them.

Spending Advertising Money Just to Say You Advertise- I would almost rather see my clients not advertise then to spend without regard to tracking the results. There is no point in a marketing campaign if you do not put things in place that allow you to measure how well the plan is working. The other wasteful part of marketing that many people make the mistake of doing, is not tracking their previously successful campaigns. Why some people think that just because a $400 dollar a month ad worked once very well for one busy season, that it will automatically work every year after that is beyond me.

Spreading Yourself Too Thin- This is a classic mistake made by every entrepreneur. The key is to figure out when you are at that “wearing too many hats” point and start getting some help. The solution here is to know your strengths and to be able see when you are not performing the duties that demand these skills. If you are the best sales person on the company, you can’t get caught up in day-to-day operations. If you do, sales will slip and eventually you won’t have any operations to worry about. Think about this to help you figure out if you are spread too thin: Did you really go into business for yourself to work 80+ hours a week?

Not Getting Help Soon Enough- Set goals to know when to hire people to take over where you are light on knowledge. Not getting help or waiting too long can kill a company. Most people who start a business do it because they are good at the technical end or the sales end. If you know the best way to make a widget, then your strength is in production and that is where your time should be spent. Hire an outside company or consultant to take care of the sales and marketing and then hire inside when you can afford someone full time. Don’t be something to your company that you are not. It will only hold you back.

The three big issues people like to tackle themselves but usually are least knowledgeable about are legal issues, accounting/bookkeeping issues and daily operations issues. The odds are that these three things are your weakest link so if you don’t have a partner that has the background for these subjects, then be prepared to get help as soon as possible. It’s preferable that you do this before you start a business.

Although looking for these problems at any time is a good idea, the end of a year or season is an excellent business interval to make sure you are not making these errors. Take the time, or make the time, to fix these problems. If you don’t know how to reverse the problems, then get some help. If you really don’t have enough time to either figure out if you have these issues or know they are there and can’t break away long enough to do it right, then get some help.

7 Tips to Starting a Successful Small Business

2009-01-18T04:48:00.000-07:00

Getting a small business off the ground is challenging to say the least. Here are some tips which will prepare the ground for running a successful small business.

Have Goals

This is where it all starts – the foundation for success. Know exactly where you are heading. What will the business ‘look’ like in the future? How will you know when your business is a success? When you wake up in the morning, do you know what actions you have to take to get you on the road to success?

Take Action

The difference between success and failure is down to the actions you take. The failures in life are the people who know what they have to do but never do it. The successful small business owners are people who take action on their ideas, ones who never say, “I wish I had done …”

Seek Feedback

There is a saying that feedback is the breakfast of champions. During the early days of your business you must continually seek feedback about all aspects of your business. What works? What doesn’t work? What needs changing slightly? Speak to customers, suppliers, your bank manager, your accountant - anyone who can provide you with a fresh perspective.

Find Out What Do You Don’t Know

You can’t expect to know everything about running a business. Undertake your own skills analysis and find out your areas for development. Once you know your knowledge gaps seek out courses, books and advice, which will get you on track.

Be Focused

Let no one distract you from achievement of your goals. At the start of every day get yourself into the frame of mind that you will only do tasks which will get you closer to your goal – nothing else matters.

Take Risks!

You will never achieve anything if you’re not prepared to jump off the cliff a few times! We’re not talking about risks which will put the business in jeopardy; just risks which are planned and thought out, yet at the same time test the edge!

Think Positive

Yes, the oldest cliché in the book, but totally true. See the positive in everything. If something has not gone right train yourself to ask, “What good has come out of this?” Understand that in every problem there is potential for good.

7 Key Tactics For The Small Business Owner

2009-01-17T09:45:00.000-07:00

For most folks, owning your own business is a dream come true. The freedom of being your own boss and succeeding to the best of your ability are facts of life for the small business owner. Sure, there's more stress than what you probably imagined when you were creating your grand plans, but with a little strategy and planning you can overcome any tough spot you get in. There are 7 tactics developed by successful marketers that are sure to make your business as successful as theirs.

1. Create A One of a Kind Selling Point
If you want to stand out from the crowd, create a unique selling proposition that stresses the benefits the customers will receive from doing business with you. Will they get faster service? Go ahead and dramatize it, but keep the customer at the focus..."Get free overnight delivery!" Hey, it tells the customer...you get quick service and a discount on shipping. Two definite benefits in one statement.

Why should someone buy from you and not your competitor? I hate to deal a blow to your ego, but it really has nothing to do with you , your product, or your service. Yeah, its a little self-centered, but customers are attracted by offers that point out the things that benefit THEM.

Don't go out on a limb to create new products and services to get attention. Just, add a special benefit to the ones you already have... maybe it's quicker service. The most effective things to emphasize are benefits that your competition cannot or is not willing to give.

2. Use Testimonials
Hey, we all know that business owners think their product or services are the best thing going, but it's what the current customers think about it that really matters to your prospective customers. They're the ones who see things from their point of view... what they have to say about the business has an impact.

Testimonials play an important part in advertising - especially for small businesses. Yeah, big businesses with well-known names don't have to worry about it, but small companies can use testimonials as marketing tools to build credibility.

Think about it...how else can we gain credibility than by creating a group of satisfied customers and shouting what they have to say? Let's look at some ways we can make testimonials an effective part of our marketing campaigns.

3. Upsell
Upselling is one of the most successful marketing trends today. Everywhere you go, someone is trying to get you to buy more. From McDonalds with its supersize options to clothing stores that try to sell you shoes to match your outfit, everyone's jumping on the band wagon. Why? It works!

Your customers already know that you have great products and provide satisfactory service. They trust you to come through for them. Think about it... it's much easier to make sales to someone you already have a relationship with.

Use every opportunity to increase your sales volume within the customer audience you already have. Do you have a product that goes with the one they are purchasing? Offer it to them at the register. It's a proven and effective method for increasing sales. You may be shocked at the additional sales you can generate from those who are already buying from you.

4. Make Your Price Seem Smaller
Divide and conquer... The old war tactic works in marketing too! When the price seems too steep, break it down into "buyable" size bites. An $120 item is only 12 low monthly payments of $10. A $365 purchase would only cost $1 per day. Now that sounds affordable!

5. Paint The Benefits Pretty
Customers buy because they want to enjoy the benefits of the purchase. A lady might buy a dress because she wants to feel sexy, or a man will buy a book because he finds pleasure in reading. Emotions are the key element that drives purchases.

Use word pictures to stir up the emotions that will instigate the sale. Let them "feel" the benefits, and they'll be more apt to head for the cash register. Put them where you want them.

6. Create Attention Getting Headlines
Are you ready to capture your reader's attention with great copy? The headline is the place to start. How often do you scan the newspaper's headlines before you decide whether or not to read the article? Yeah, that's where we lose or gain the reader's interest, so it's a pretty important part of the advertisement.

A good headline should telegraph its message in twelve words or less. Double check those headlines. Do they make a promise of a positive benefit, or ask a provocative question? Don't settle for less than attention grabbing statements.

7. Provide An Offer They Can't Resist
Is your deal too good to pass up? If not, you need to improve it. Hey, I'm not talking about cutting prices even more...you've still got to make a profit. You can make the deal sweeter just by increasing the readers knowledge of the value of the product, or adding bonuses that are perceived as valuable, but cost you little.

Motivate buyers with expirations. Yeah, an open ended offer encourages procrastination...which leads ...yep, nowhere. When the customer knows he has until Saturday to purchase an item he'll pay more for on Sunday, he'll make it a priority to head for your shop.

7 Critical Business Financing Mistakes

2009-01-16T11:44:00.000-07:00

Avoiding the top 7 business financing mistakes is a key component in business survival.

If you start committing these business financing mistakes too often, you will greatly reduce any chance you have for longer term business success.

The key is to understand the causes and significance of each so that you're in a position to make better decisions.

>>> Business Financing Mistakes (1) - No Monthly Bookkeeping.

Regardless of the size of your business, inaccurate record keeping creates all sorts of issues relating to cash flow, planning, and business decision making.

While everything has a cost, bookkeeping services are dirt cheap compared to most other costs a business will incur.

And once a bookkeeping process gets established, the cost usually goes down or becomes more cost effective as there is no wasted effort in recording all the business activity.

By itself, this one mistake tends to lead to all the others in one way or another and should be avoided at all costs.

>>> Business Financing Mistakes (2) - No Projected Cash Flow.

No meaningful bookkeeping creates a lack of knowing where you've been. No projected cash flow creates a lack of knowing where you're going.

Without keeping score, businesses tend to stray further and further away from their targets and wait for a crisis that forces a change in monthly spending habits.

Even if you have a projected cash flow, it needs to be realistic.

A certain level of conservatism needs to be present, or it will become meaningless in very short order.

>>> Business Financing Mistakes (3) - Inadequate Working Capital

No amount of record keeping will help you if you don't have enough working capital to properly operate the business.

That's why its important to accurately create a cash flow forecast before you even start up, acquire, or expand a business.

Too often the working capital component is completely ignored with the primary focus going towards capital asset investments.

When this happens, the cash flow crunch is usually felt quickly as there is insufficient funds to properly manage through the normal sales cycle.

>>> Business Financing Mistakes (4) - Poor Payment Management.

Unless you have meaningful working capital, forecasting, and bookkeeping in place, you're likely going to have cash management problems.

The result is the need to stretch out and defer payments that have come due.

This can be the very edge of the slippery slope.

I mean, if you don't find out what's causing the cash flow problem in the first place, stretching out payments may only help you dig a deeper hole.

The primary targets are government remittances, trade payables, and credit card payments.

>>> Business Financing Mistakes (5) - Poor Credit Management

There can be severe credit consequences to deferring payments for both short periods of time and indefinite periods of time.

First, late payments of credit cards are probably the most common ways in which both businesses and individuals destroy their credit.

Second, NSF checks are also recorded through business credit reports and are another form of black mark.

Third, if you put off a payment too long, a creditor could file a judgement against you further damaging your credit.

Fourth, when you apply for future credit, being behind with government payments can result in an automatic turndown by many lenders.

It gets worse.

Each time you apply for credit, credit inquiries are listed on your credit report.

This can cause two additional problems.

First, multiple inquiries can reduce you overall credit rating or score.

Second, lenders tend to be less willing to grant credit to a business that has a multitude of inquiries on its credit report.

If you do get into situations where you're short cash for a finite period of time, make sure you proactively discuss the situation with your creditors and negotiate repayment arrangements that you can both live with and that won't jeopardize your credit.

>>> Business Financing Mistakes (6) - No Recorded Profitability

For startups, the most important thing you can do from a financing point of view is get profitable as fast as possible.

Most lenders must see at least one year of profitable financial statements before they will consider lending funds based on the strength of the business.

Before short term profitability is demonstrated, business financing is based primary on personal credit and net worth.

For existing businesses, historical results need to show profitability to acquire additional capital.

The measurement of this ability to repay is based on the net income recorded for the business by a third party accredited accountant.

In many cases, businesses work with their accountants to reduce business tax as much as possible but also destroy or restrict their ability to borrow in the process when the business net income is insufficient to service any additional debt.

>>> Business Financing Mistakes (7) - No Financing Strategy

A proper financing strategy creates 1) the financing required to support the present and future cash flows of the business, 2) the debt repayment schedule that the cash flow can service, and 3) the contingency funding necessary to address unplanned or unique business needs.

This sounds good in principle, but does not tend to be well practiced.

Why?

Because financing is largely an unplanned and after the fact event.

It seems once everything else is figured out, then a business will try to locate financing.

There are many reasons for this including: entrepreneurs are more marketing oriented, people believe financing is easy to secure when they need it, the short term impact of putting off financial issues are not as immediate as other things, and so on.

Regardless of the reason, the lack of a workable financing strategy is indeed a mistake.

However, a meaningful financing strategy is not likely to exist if one or more of the other 6 mistakes are present.

This reinforces the point that all mistakes listed are intertwined and when more than one is made, the effect of the negative result can become compounded.

5 Simple Steps to Small Business Success on the Internet!

2009-01-15T08:16:00.000-07:00

For years, the website design market used to fall into three separate entities for website design and development: (i) graphics and animation studios, specializing in custom graphic design and creative animations, (ii) website marketing/promotion firms, (iii) Web programming companies specializing in database-driven website development. Nowadays, however, you get to see a fusion of these three entities in several dynamic Web Development and Promotion companies operating from any part of the globe. These web design, development and web promotion firms are virtually allrounders that cater to a diverse range of clientele, include those coming up for creative web design, web databases CRM / ERP as well as for SEO (search engine optimization) needs.

Most small business firms all over the world heavily rely on the services of such web development firms as they usually cater to small business website design by providing web based marketing methods that small companies can afford due to small budgets. Depending on the effectiveness of such web-based marketing, clients often see incredible successful results from clicks to conversion. There are some case studies which show that utilizing their marketing equation; some sites have gone from 10 leads a month to 300 leads. However, to achieve this is easier said than done. Web marketing firms that create a full plan for their clients using both the strategic and tactical methods crafted by specialists/consultants in turn are able to give small or large businesses increased sales. After all, that is the reason one can zero down on in order to be in a business, right? To have more sales and offer value. Therefore, the objective behind any web development or website promotion project is to create a unique selling proposition through your website that can set you apart from your competition so your customers should only think of doing business with you, regardless of price.

Small business firms today look forward to the professional creative website design and strategic web development and web promotion companies for the simple reason that they want their site to have the look and usability of a Fortune 500 company site without having to spend huge bucks for it. Yes, it is definitely considered a plus if the website is designed as a tactical marketing tool that aims to engage and educate their clients in turn. And most of these businesses have a concern in their minds: can their web site provide a means to gather analytical data for them to offer better service for all?

Yes, definitely they can. However, for this, optimal, effective website design strategies need to be incorporated. In a word, small business clients should be enriched with at least some of these features in order to fetch more conversions:
* Cutting-edge small business website design, tailor-made to provide broad market exposure of the products and services to potential clients.
* Highly scalable digital website designs, aimed at boosting up the growth and realization of the full perspective of the small business houses.
* Small business website design strategies including full-featured e-commerce solutions, to help these businesses deploy cost-effective, powerful e-commerce stores.
* Customized search engine optimization services, based upon individual needs and goals.

However, there are umpteen so-called 'cheap, quick' solution-providers, and any small business firm must think twice before taking the plunge with them. Ideally, one should always trust a professional web development firm that gathers relevant information about their clients' business through hours of discussion, clear up ideas about the requirement, nature and goal of the clients' business. Based on these details, experienced, skilled web designers and developers carry out extensive research to find out the best small business website solution. On the other hand, creative, innovative content writers create specific and unique content for small business website requirements, thereby enhancing business prospects. Finally, website maintenance and search engine optimization techniques that comprise scientifically proven techniques available at a competitive price are sure to give your business a boost. Flash Presentation, Multimedia Presentation, Multi-lingual website development and E-Commerce integration solutions complement these customized website solutions for brightening the online and even the offline image of small business firms.

The Five Steps to Success:

To ensure success of your small business through a unique website presentation, it is important that you develop a five-step process for creating websites that meet your customer's goals. Whether it is a small business firm eager to generate leads, sell online, provide information about their services, connect their vendors to their company electronically, or start an entirely new kind of service, this five-step process not only takes them from concept to completion, but also is the trademark of any Internet development company. Consulting: Every website starts with an idea. Perhaps you've been thinking about developing a website, or redesigning your existing site. At the consulting stage, a professional website development firm would strive to clear all doubts about the clients' requirements. Consultation for this usually comes free in case of small to medium-sized businesses.

Website Design: After the initial consultation, the website development firm solidifies the clients' ideas by creating a blueprint for their site by employing something they call "Strategic Design".

Website Development: The website development project is then handled by a creator' hive, composed of specialists who handle their own respective pieces of the site development. Remember, for successful website development, it is necessary to be handled by a versatile team of expert graphic artists, content writers, programmers, database specialists and technical personnel. This ensures that a qualified professional handles each task of the given project.

Web Hosting: Since websites are an intricate interplay of graphics, text, programming and computer resources, building your site on a rock-solid web hosting foundation is critical to its marketing success.

Website Maintenance: Once the site is available to the public, it must be maintained with the help of ongoing updates and continued development to the site so that they don't give clients/visitors of the site a chance to complain about its quality and content.

5 Key Components Of A Small Business Acquisition Loan

2009-01-14T07:45:00.000-07:00

Major Challenges To Securing A Business Acquisition Loan

Qualifying for a small business acquisition loan can be quite an ordeal to say the least.

If the business being sold is very profitable, the selling price will likely reflect a significant amount of goodwill which can be very difficult to finance.

If the business being sold is not making money, lenders can be difficult to find even if the underlying assets being acquired are worth substantially more than the purchase price.

Business acquisition loans, or change of control financing situations, can be extremely varied from case to case.

That being said, here are the major challenges you'll typically have to overcome to secure a small business acquisition loan.

>>> Financing Goodwill

The definition of goodwill is the sale price minus the resale or liquidation value of business assets after any debts owing on the assets are paid off. It represents the future profit the business is expected to generate beyond the current value of the assets.

Most lenders have no interest in financing goodwill.

This effectively increases the amount of the down payment required to complete the sale and/or the acquisition of some financing from the vendor in the form of a vendor loan.

Vendor support and Vendor loans are a very common elements in the sale of a small business.

If they are not initially present in the conditions of sale, you may want to ask the vendor if they would consider providing support and financing.

There are some excellent reasons why asking the question could be well worth your time.

In order to receive the maximum possible sale price, which likely involves some amount of goodwill, the vendor will agree to finance part of the sale by allowing the buyer to pay a portion of the sale price over a defined period of time within a structured payment schedule.

The vendor may also offer transition assistance for a period of time to make sure the transition period is seamless.

The combination of support and financing by the vendor creates a positive vested interest whereby it is in the vendor's best interest to help the buyer successfully transition all aspects of ownership and operations.

Failure to do so could result in the vendor not getting all the proceeds of sale in the future in the event the business were to suffer or fail under new ownership.

This is usually a very appealing aspect to potential lenders as the risk of loss due to transition is greatly reduced.

This speaks directly to the next financing challenge.

>>> Business Transition Risk

Will the new owner be able to run the business as well as the previous owner? Will the customers still do business with the new owner? Did the previous owner possess a specific skill set that will be difficult to replicate or replace? Will the key employees remain with the company after the sale?

A lender must be confident that the business can successfully continue at no worse than the current level of performance. There usually needs to be a buffer built into the financial projections for changeover lags that can occur.

At the same time, many buyers will purchase a business because they believe there is substantial growth available which they think they can take advantage of.

The key is convincing the lender of the growth potential and your ability to achieve superior results.

>>> Asset Sale Versus Share Sale

For tax purposes, many sellers want to sell the shares of their business.

However, by doing so, any outstanding and potential future liability related to the going concern business will fall at the feet of the buyer unless othewise indicated in the purchase and sale agreement.

Because potential business liability is a difficult thing to evaluate, there can be a higher perceived risk when considering a small business acquisition loan application related to a share purchase.

>>> Market Risk

Is the business in a growing, mature, or declining market segment? How does the business fit into the competitive dynamics of the market and will a change in control strengthen or weaken its competitive position?

A lender needs to be confident that the business can be successful for at least the period the business acquisition loan will be outstanding.

This is important for two reasons. First, a sustained cash flow will obviously allow a smoother process of repayment. Second, a strong going concern business has a higher probability of resale.

If an unforeseen event causes the owner to no longer be able to carry on the business, the lender will have confidence that the business can still generate enough profit from resale to retire the outstanding debt.

Localized markets are much easier for a lender or investor to assess than a business selling to a broader geographic reach. Area based lenders may also have some working knowledge of the particular business and how prominent it is in the local market.

>>> Personal Net Worth

Most business acquisition loans require the buyer to be able to invest at least a third of the total purchase price in cash with a remaining tangible net worth at least equal to the remaining value of the loan.

Statistics show that over leveraged companies are more prone to suffer financial duress and default on their business acquisition loan commitments.

The larger the amount of the business acquisition loan required, the more likely the probability of default.

Small Home-Based Businesses -- Five Simple Steps to Success

2009-01-13T14:57:00.003-07:00

Did you know that, in Australia, 60% of small businesses fail in the first twelve months? For those of us who would like to start a small business -- maybe even work from home -- that’s a very discouraging statistic.

Does that mean that your business idea is doomed to failure? Far from it! There are steps you can take that greatly increase your chances of success. With a little time and some serious research you can hit the ground running. Let’s start from the beginning…

The bright idea

First, of course, you need to come up with an idea. Typically, business opportunities can be divided into four groups:

1. Offering an existing product/service in an existing market.
2. Introducing an existing product/service to a new market.
3. Offering a new product/service in an existing market
4. Introducing a new product/service to a new market.

At this stage of the game the only limit is your imagination. Inspiration can come from anywhere -- maybe you have a hobby that you’d like to turn into a full-time job; you may be on the receiving end of bad service one day and decide to try doing it better yourself; or you may have a talent that you’d like to capitalise on.

Once you’ve come across something that you’d like to do, it’s time to take a look at the market and see what’s on offer.

Passing the test

So you’ve had a great idea and you’re keen to roll with it; now it’s time to put it through its paces. For the purpose of the exercise, let’s say that you have a passion for healthy living, and that you want to distribute a range of lifestyle accessories that promote healthy living with a do-it-yourself approach.

Ask around: Is there a market for products that promote healthy living? What sorts of products are available? Who would you be competing with and what do your competitors offer? Do you have the necessary skills to run such a business and -- more to the point -- what would those skills be? Where would your business be located?

Once you’ve answered those questions you should have a fairly clear picture of what your business will look like.

You source some products and decide to do some further research into the range of lifestyle products offered by a company called Vitality 4 Life. Your own life experience plus some work you’ve done as a dietician has given you the necessary skill sets, and you think that you’ll be able to work from home, giving you more time for family. There is an existing market, but there’s room for expansion. Now it’s time to take a closer look.

To be or not to be?

It’s time to get down to the nuts and bolts. You don’t want to jump into something feet first and find out the hard way that the budget just doesn’t work.

To get started, sit down and work out if you need to hire staff, which means paying wages.

If you lease a premises you’ll need to be able to pay the rent, and your location will have to be suitable for your business and target market (which also means that you’ll have to think carefully about just what that target market is). You’ll also need to work out the likely demand for your product/service.

Ok… you’ve worked out that there is enough demand for good quality juicers, sprouters, water filters and other high end accessories to take a shot at a distributorship as a home-based business opportunity. Now you need to make some marketing decisions.

Look at me! Look at me!

Advertising can be costly so you’ll want to be sure that your advertising budget is spent wisely. That means more market research, this time one-on-one. Profile your customer groups so you can aim your marketing at the right group/s of people.

Draw up a questionnaire (a short questionnaire -- people run out patience if you ramble for too long) and hang around outside a few of the local gyms (for our particular example). Come up with a mixture of open questions (What do you think of……..?) and closed questions (Do you have a gym membership? Yes/No.); sliding scales can be useful too.

For our health accessories business, a good question might be ‘How did you hear about this gym? Radio, tv, newspaper, word of mouth etc…’ Such a question would then give you an indication of the types of media that your target group responds best to.

Choose a business name, print up some business cards, buy some stock and get ready to trade!

Measure it, manage it!

A teacher of mine made the point that, in business, if you can’t measure it you can’t manage it.

You need to be able to plan ahead, and to do that you need to know -- or to be able to accurately predict -- your total sales. The equation is simple: number of customers x average sale x frequency of visits per customer per year = total sales. Remember it, revise it often, measure your business and you’ll be able to manage it!

Keep an eye on your bottom line and, most importantly, always be aware of your cash flow -- the cold, hard cash that you have in the bank. Allow for invoice periods (14 days, 30 days etc) when you’re planning your budget.

The market place has a life of its own, and no one can prepare for every contingency. Put some thought into your idea; make sure that there’s a market for what you’re offering; research, research, research; promote your business effectively; always know what’s going on in your bank account and don’t forget about cash flow!

It’s not perfect but, if you follow these few simple steps, you’ll be miles ahead of many new small business ventures. If you’ve heard of a great home-based business opportunity, or have a product or service of your own to market, you’re off to a great start!