There are many people who seek to start their own business because they see it as a way out of a job.
But yet, they don't factor in the uncertainty and the risk inherent to running their own business.
When starting your own business, you must factor in the uncertainties brought about by the following harsh realities:
1. Starting your own business is hard work.
2. Starting your own business is filled with lots of risk.
3. Starting your own business will challenge everything you thought you knew about yourself and your abilities.
Sometimes in the running of your business,you will find that you are met with challenge after challenge.
Get used to facing uncertainty - learn how to move your business forward despite risk and uncertainties.
There will be days when things just don't seem to be going your way.
There will be days when you thought you had it in the bag, only to find out that it all slipped through your fingers in just a moment.
There will even be days when you will encounter situations that you just don't quite know how to handle.
In fact, there will be days when you feel tired and unfocused and not quite sure how to proceed.
But don't let this stop you.
You MUST be willing to get up everyday with a determined stance to make your business work.
You must be able to Overcome The Start-up Blues by dealing with uncertainty head-on.
Uncertainty is a reality of any business - small or large.
There will be some days where you will have to move through your fears and hesitancies to keep your business moving.
Take this business given and small start tip to heart.
Uncertainty is a given.
Remembering this will help you to preserve your sanity during those moments when you feel paralyzed and overwhelmed.
Don't loose focus.
It's only those businesses that learn how to act in the face of uncertainty that will win in the end.
Thus, make it a habitual practice to view your business through a strategic lens.
Here's to your small business start-up success!
Latarsha Lytle, MBA is a motivational speaker and certified Career and Life Purpose Coach who holds (1) an MBA in Business Strategy and (2) a second Master's in Marketing with an emphasis in Branding and Positioning.
Her passion is helping those who are in unfulfilling careers to:
* First to identify their SweetSpot - THAT thing that they were made to do and to be,
* Then she works with them to position their SweetSpot into a signature career or business:
(a) that fits their passion, their life, AND pays them their worth...
(b) all while allowing them to leave their legacy and mark in the world.
Article Source: http://EzineArticles.com/852095
Friday, July 15, 2011
How To Lessen The Fear Of Starting Your Own Business
Are you are working a dead-end job thinking it is time for a change? Do you keep thinking the change you are looking for is to start your own business but are too scared to give it a try? Why let your fears stop you from making, what could be, the best move of your working life?
Caution is good and will help prevent you from making wrong decisions, but fear is not because it will prevent you from making the right ones. In order to overcome this fear, you need a way to answer your questions and address your fears.
The fear of starting a new business is largely the fear of the unknown. What will I do if my business does not make enough money? What will happen to my marriage if we go bankrupt? How will I pay my bills?
What will my friends and family think of me? These are all legitimate questions and you certainly have many more. The answer to all of them is research, preparation, and planning.
In order to lessen the fear that comes from starting a new business, you will need to expend the time and effort it takes to thoroughly research your prospective business. You must study every bit of information you can get your hands on. Many industries have member organizations that provide help to get you started, take advantage of them.
Go to the public library and ask for help. There is an enormous amount of information on the Internet, make use of it. Visit every business remotely similar in your area. Lastly, spend some time talking to the suppliers you will be using, they can provide answers you will not find anywhere else.
Preparation should also play a large part in lessening your fears. Many community colleges offer instruction in starting and running a small business. There are also many online options here as well. A trip to the local bookstore or library will yield many books and training videos.
Perhaps the best way to prepare for your new business is by getting a job doing the same type of work. It is no coincidence that people often open their own business doing the same work they formerly did for someone else.
Planning is the third key to overcoming the fear that is holding you back. Write up a business plan, even if no one will ever see it but you. This will force you to consider all the elements of your new business and give you the information you need to decide if it is right for you.
A standard business plan is meant to cover every aspect of your business and includes sections on marketing, financial projections and cash flow, market analysis, your management structure, and a thorough analysis of your products or services.
By using the three keys of research, preparation, and planning, you will acquire the knowledge you need to make an informed decision about the feasibility of any new business you are considering.
This will, in turn, give you the self-confidence you need to overcome the very rational fear you feel, along with the absolutely essential benefit of having a well thought out plan to get you started the right way.
Aldar Nagy is the author of several informational type websites. These include The Business Startup Resource, which offers new business profiles, ideas, advice, and other resources for you when you are starting your own business. The Business Startup Resource can be found at: [http://www.businessstartupresource.com] Check back often, new business profiles are being added all the time.
Article Source: http://EzineArticles.com/846615
Caution is good and will help prevent you from making wrong decisions, but fear is not because it will prevent you from making the right ones. In order to overcome this fear, you need a way to answer your questions and address your fears.
The fear of starting a new business is largely the fear of the unknown. What will I do if my business does not make enough money? What will happen to my marriage if we go bankrupt? How will I pay my bills?
What will my friends and family think of me? These are all legitimate questions and you certainly have many more. The answer to all of them is research, preparation, and planning.
In order to lessen the fear that comes from starting a new business, you will need to expend the time and effort it takes to thoroughly research your prospective business. You must study every bit of information you can get your hands on. Many industries have member organizations that provide help to get you started, take advantage of them.
Go to the public library and ask for help. There is an enormous amount of information on the Internet, make use of it. Visit every business remotely similar in your area. Lastly, spend some time talking to the suppliers you will be using, they can provide answers you will not find anywhere else.
Preparation should also play a large part in lessening your fears. Many community colleges offer instruction in starting and running a small business. There are also many online options here as well. A trip to the local bookstore or library will yield many books and training videos.
Perhaps the best way to prepare for your new business is by getting a job doing the same type of work. It is no coincidence that people often open their own business doing the same work they formerly did for someone else.
Planning is the third key to overcoming the fear that is holding you back. Write up a business plan, even if no one will ever see it but you. This will force you to consider all the elements of your new business and give you the information you need to decide if it is right for you.
A standard business plan is meant to cover every aspect of your business and includes sections on marketing, financial projections and cash flow, market analysis, your management structure, and a thorough analysis of your products or services.
By using the three keys of research, preparation, and planning, you will acquire the knowledge you need to make an informed decision about the feasibility of any new business you are considering.
This will, in turn, give you the self-confidence you need to overcome the very rational fear you feel, along with the absolutely essential benefit of having a well thought out plan to get you started the right way.
Aldar Nagy is the author of several informational type websites. These include The Business Startup Resource, which offers new business profiles, ideas, advice, and other resources for you when you are starting your own business. The Business Startup Resource can be found at: [http://www.businessstartupresource.com] Check back often, new business profiles are being added all the time.
Article Source: http://EzineArticles.com/846615
5 Reasons To Start Your Own Business
Go ahead and admit it, you have been thinking of opening your own business for a long time but you always manage to talk yourself out of it. The more you think about it, the more the whole thing makes you break out in a cold sweat. The problem is you just cannot seem to stop thinking about it. Here are five great reasons why you really should give it a try and go into business for yourself.
1. You Control Your Destiny -
Some people are content to follow the lead of others, but there are those who long to take control of their lives and are simply not happy otherwise. When you work for others, you have no choice but to follow their rules. Be the one who makes the rules, instead of the one who follows them.
2. Your Income Is Not Limited -
When you work for yourself, your income is only limited by your imagination, your skills, and your dedication to what you are doing. The potential is simply not there to go beyond an average wage if you work for others. If you really want to secure your financial well being, you will need to go into the right business for yourself.
3. You Can Make A Difference -
Ask yourself how much of a difference you are making at your current job. Then imagine the difference you could be making as a business owner. As an owner, you will have the opportunity to be an employer and make a difference in the lives of the people you hire. If your business is successful enough, you will also have the financial ability to contribute to needy and important charities or even fund your own charitable foundation.
4. More Secure Than Working For Someone Else -
Once upon a time in America, a person could work for a single company their entire career and then get paid a pension and benefits after they retired. This idea is now as dead as the dinosaurs. Today, there is no guarantee you will have a job next week, much less your whole career.
You are still subject to uncertainty with your own business, but you will be able to change your business as your market conditions change. If you are an employee, the change that is made might be you. Sorry, nothing personal.
5. Do Something You Enjoy -
If you ask twenty people if they enjoy what they do for a living, how many do you think will answer yes? How would you answer this same question? What could be worse than reaching the end of your working life and looking back with regret for never having done any work you enjoy? Find something you like that will support you and your family. Take the chance, it might be the best thing you ever do.
Starting and running a business of your own can be the most rewarding experience of your life in so many ways. Imagine how much richer your life, and the life of your family, can be if you start the right business. It is fine to talk yourself out of the wrong business but make sure to consider the many benefits, including those listed here, before talking yourself out of the right one.
Aldar Nagy is the author of several informational type websites. These include The Business Startup Resource, which offers new business profiles, ideas, advice, and other resources for you when you are starting your own business. The Business Startup Resource can be found at: [http://www.businessstartupresource.com] Check back often, we are adding new business profiles all the time.
Article Source: http://EzineArticles.com/839972
1. You Control Your Destiny -
Some people are content to follow the lead of others, but there are those who long to take control of their lives and are simply not happy otherwise. When you work for others, you have no choice but to follow their rules. Be the one who makes the rules, instead of the one who follows them.
2. Your Income Is Not Limited -
When you work for yourself, your income is only limited by your imagination, your skills, and your dedication to what you are doing. The potential is simply not there to go beyond an average wage if you work for others. If you really want to secure your financial well being, you will need to go into the right business for yourself.
3. You Can Make A Difference -
Ask yourself how much of a difference you are making at your current job. Then imagine the difference you could be making as a business owner. As an owner, you will have the opportunity to be an employer and make a difference in the lives of the people you hire. If your business is successful enough, you will also have the financial ability to contribute to needy and important charities or even fund your own charitable foundation.
4. More Secure Than Working For Someone Else -
Once upon a time in America, a person could work for a single company their entire career and then get paid a pension and benefits after they retired. This idea is now as dead as the dinosaurs. Today, there is no guarantee you will have a job next week, much less your whole career.
You are still subject to uncertainty with your own business, but you will be able to change your business as your market conditions change. If you are an employee, the change that is made might be you. Sorry, nothing personal.
5. Do Something You Enjoy -
If you ask twenty people if they enjoy what they do for a living, how many do you think will answer yes? How would you answer this same question? What could be worse than reaching the end of your working life and looking back with regret for never having done any work you enjoy? Find something you like that will support you and your family. Take the chance, it might be the best thing you ever do.
Starting and running a business of your own can be the most rewarding experience of your life in so many ways. Imagine how much richer your life, and the life of your family, can be if you start the right business. It is fine to talk yourself out of the wrong business but make sure to consider the many benefits, including those listed here, before talking yourself out of the right one.
Aldar Nagy is the author of several informational type websites. These include The Business Startup Resource, which offers new business profiles, ideas, advice, and other resources for you when you are starting your own business. The Business Startup Resource can be found at: [http://www.businessstartupresource.com] Check back often, we are adding new business profiles all the time.
Article Source: http://EzineArticles.com/839972
Start Your Own Business - "Measure Twice - Cut Once"
That old carpenters rule should be considered when starting a new business of your own. Be courageous, be bold, be committed and most of all be prepared!
Coming from Europe I am very accustomed with the mentality of being overly cautious, conservative and extremely planned out. This will generally result in perfection - granted the German automobiles might not be what they used to... Once in the States I have been confronted with a mentality of having great ideas and getting right into them full force forward.
Our history was influenced by this trailblazing mentality and built this great nation at the high speed we live our daily lives.
Personally I have been on the track of implementing the best of both worlds for myself. This is how I believe one should start their own business. With a great idea and believe, energetic and consistent, well thought through and planned out in all aspects.
See, it will not do you any good to run into a wall after a few months in business because you just did not take in account what kind of realistic obstacles could occur (motivation, personal, financial...).
Since you are researching this matter it only seems fair to me to warn you of these obstacles, because they do exist.
They are what keeps the employee remaining an employee and challenge the entrepreneur to rise to higher levels by overcoming them. You can start a franchise, begin producing some product at home, open a restaurant or bar (lots of illusions involved in this one). In all scenarios you want to take some things into account:
Your initial financial commitment - Yes, any real business you start will cost money to start and to operate
A realistic time frame - No one has become a millionaire over night starting his own business
Where can you get help from people with experience - Try to do it alone and you will most likely fail
Setting goals that are realistic, measurable and timed (50,000$ additional in bank account by January 1st 2009), writing them down and visualizing them
Using a DMO (Daily Method of Operation) - this leaves no question about what needs to be done, no goofing off and taking your kids' Playstation hostage for a day
All points above are useless if you do not do one thing: Take Action! You can be as well planned, funded, prepared, organized and dreaming about your goals as you want - if you do not Take Action - Nothing Will Happen! Makes sense reading it, but you would be surprised how many entrepreneurs fail when getting ready to get ready to get ready.
At the age of 5 Stefan moved to Germany, then at 12 to Switzerland where he ended up studying International Hospitality Management and received a degree in Executive Restaurant and Hotel Management.
After several five star engagements his path has brought him and his wife back to the United States where they recently welcomed their first baby girl to the world. He has since then left Corporate America as well as a substantial paycheck behind and followed his instincts to become a successful Entrepreneur and CEO of his own company.
Article Source: http://EzineArticles.com/827118
Coming from Europe I am very accustomed with the mentality of being overly cautious, conservative and extremely planned out. This will generally result in perfection - granted the German automobiles might not be what they used to... Once in the States I have been confronted with a mentality of having great ideas and getting right into them full force forward.
Our history was influenced by this trailblazing mentality and built this great nation at the high speed we live our daily lives.
Personally I have been on the track of implementing the best of both worlds for myself. This is how I believe one should start their own business. With a great idea and believe, energetic and consistent, well thought through and planned out in all aspects.
See, it will not do you any good to run into a wall after a few months in business because you just did not take in account what kind of realistic obstacles could occur (motivation, personal, financial...).
Since you are researching this matter it only seems fair to me to warn you of these obstacles, because they do exist.
They are what keeps the employee remaining an employee and challenge the entrepreneur to rise to higher levels by overcoming them. You can start a franchise, begin producing some product at home, open a restaurant or bar (lots of illusions involved in this one). In all scenarios you want to take some things into account:
Your initial financial commitment - Yes, any real business you start will cost money to start and to operate
A realistic time frame - No one has become a millionaire over night starting his own business
Where can you get help from people with experience - Try to do it alone and you will most likely fail
Setting goals that are realistic, measurable and timed (50,000$ additional in bank account by January 1st 2009), writing them down and visualizing them
Using a DMO (Daily Method of Operation) - this leaves no question about what needs to be done, no goofing off and taking your kids' Playstation hostage for a day
All points above are useless if you do not do one thing: Take Action! You can be as well planned, funded, prepared, organized and dreaming about your goals as you want - if you do not Take Action - Nothing Will Happen! Makes sense reading it, but you would be surprised how many entrepreneurs fail when getting ready to get ready to get ready.
At the age of 5 Stefan moved to Germany, then at 12 to Switzerland where he ended up studying International Hospitality Management and received a degree in Executive Restaurant and Hotel Management.
After several five star engagements his path has brought him and his wife back to the United States where they recently welcomed their first baby girl to the world. He has since then left Corporate America as well as a substantial paycheck behind and followed his instincts to become a successful Entrepreneur and CEO of his own company.
Article Source: http://EzineArticles.com/827118
How to Run Your Own Business
To start and Run your own business is a rewarding but demanding career and life choice. Starting your own business is empowering because it puts you back in control of both your work and your life in general. Owning your own business is a dream for so many people, and certainly, you'll have the chance of making a lot more money.
Operating a business from home has some indisputable perks, such as, greater freedom and flexible hours, better balance between work family and life, lower start up and running costs, you can start your business part time working your existing job parallel, less travel and transport hassles.
To reap all the rewards in the future, you can start a home based business part time and give it time to grow with little risk and enormous possibilities. From franchising, Direct Selling to Online businesses, there are big variety of opportunities to choose from, when you want to make the transition from working for a paycheck to creating wealth.
Now, even though you probably want your business up and producing tomorrow(if not yesterday), you need to give yourself time to learn the ropes, and take advantage of the support networks at your disposal. Done right, you may find that working from home is the best career decision you ever made.
Fresh statistics shows that more than 50% of young women now want to be entrepreneurs. For all young people it's 53% who want to work for themselves. If we look at the whole population, the figure is as high as 70%. For one reason or another the majority of these individuals will never act on their dream, instead they will continue working their traditional jobs and dream the dream.
Once you've decided that starting a business is right for you, your next step of preparation will be to decide what kind of business you want to start. It will be well worth your time to give this a real thought. Think about it, what if you start a similar business as your current work, well then you'll soon be back in the same wheel traces. But what if you could work with something you really enjoy doing, how would your life feel?
There are many useful resources available that will help you to evaluate if running your own business is for you, and if so, how to go about it. Choosing to run your own business is a big step that you shouldn't take lightly. Now, if it feels right, don't wait for the right timing, just go for it.
Article Source: http://EzineArticles.com/701669
Operating a business from home has some indisputable perks, such as, greater freedom and flexible hours, better balance between work family and life, lower start up and running costs, you can start your business part time working your existing job parallel, less travel and transport hassles.
To reap all the rewards in the future, you can start a home based business part time and give it time to grow with little risk and enormous possibilities. From franchising, Direct Selling to Online businesses, there are big variety of opportunities to choose from, when you want to make the transition from working for a paycheck to creating wealth.
Now, even though you probably want your business up and producing tomorrow(if not yesterday), you need to give yourself time to learn the ropes, and take advantage of the support networks at your disposal. Done right, you may find that working from home is the best career decision you ever made.
Fresh statistics shows that more than 50% of young women now want to be entrepreneurs. For all young people it's 53% who want to work for themselves. If we look at the whole population, the figure is as high as 70%. For one reason or another the majority of these individuals will never act on their dream, instead they will continue working their traditional jobs and dream the dream.
Once you've decided that starting a business is right for you, your next step of preparation will be to decide what kind of business you want to start. It will be well worth your time to give this a real thought. Think about it, what if you start a similar business as your current work, well then you'll soon be back in the same wheel traces. But what if you could work with something you really enjoy doing, how would your life feel?
There are many useful resources available that will help you to evaluate if running your own business is for you, and if so, how to go about it. Choosing to run your own business is a big step that you shouldn't take lightly. Now, if it feels right, don't wait for the right timing, just go for it.
Article Source: http://EzineArticles.com/701669
Wednesday, July 13, 2011
A Reality Check on Starting Your Own Business
So you are starting your own business on the internet? Going to work from home and make a bundle? Right, well it's time to take a reality check.
OK, let's take a reality check. There are more budding Internet entrepreneurs than you might think. Many have spent a number of years and many thousands of dollars in their efforts to start a profitable Internet business.
It may seem as if they are all making a success of it, but that's simply not true. Not many will admit their frustration because perception is everything online. You can't afford to be perceived as a failure because no one will buy from you, and that will make sure that you fail. Fake it 'til you make it is essential.
This doesn't mean you shouldn't try? Of course not! The Internet is exploding. The potential is huge. In today's economic climate thousands, if not millions, of people are looking at starting their own Internet business.
And so they should. It was a trend that was in place well before the recession came along and it's a recession proof business.
So what are the difficulties to starting your own business online?
The first is the learning curve - it's steeper than you might think. There are several "how-to" processes online for you to follow. You've got to know which ones to follow.
I sometimes think that letting the newbie loose to find her own way at the start is one of the best ways for her to learn. Might sound harsh, but it works. My advice would be not to spend too much at the start but at least try something. You will learn this way.
Succeeding at creating wealth with an online business requires mastery of several key tasks, not all of which have a direct correlation with an offline business.
First, you need to build a really good website and/or a blog for those who understand social networking. Then you have to drive traffic to it, all without making any mistakes that cause you to lose credibility in your prospect's mind.
Not easy!
Although there are numerous experts, books, and how-to courses on how to start a business online, it's hard for a beginner to know who to believe. In addition, there are multiple online business models to choose from as well. However, as I said before, at some point you just have to jump in and test the water.
The second thing is to drive traffic to your site. Novice Internet marketers know they need their site to be ranked highly by the search engines, but often vastly underestimate the amount of competition they have for the keywords and search phrases they desire.
The reality is that a top-ten ranking for most popular keywords is extraordinarily difficult to achieve. This means that you will need to master the art of advertising online, which can become quite costly.
Thirdly, you need to understand that a lot of information will come your way and it is easy to become overwhelmed.
You might be advised to subscribe to Internet ezines or visit Internet discussion forums. These are recommended methods to build knowledge. However, you will be bombarded almost daily with new ways to make money, new advertising strategies to try, new top-secret, never-before-revealed-to-the-public ways to get more targeted website visitors than you've ever imagined. You can become paralyzed by analysis and end up doing nothing.
I suggest you read internet marketing articles. After a while, you can tell the experienced and genuine authors. That's what you are doing here.
If you're looking at creating wealth with an Internet business, this article will serve as a reality check for you. However, you do need to start somewhere and you will need some start up capital. It's certainly possible to make a substantial income online; however, it's much more likely if you have a good grasp of the obstacles you'll encounter along the way.
Article Source: http://EzineArticles.com/1813979
OK, let's take a reality check. There are more budding Internet entrepreneurs than you might think. Many have spent a number of years and many thousands of dollars in their efforts to start a profitable Internet business.
It may seem as if they are all making a success of it, but that's simply not true. Not many will admit their frustration because perception is everything online. You can't afford to be perceived as a failure because no one will buy from you, and that will make sure that you fail. Fake it 'til you make it is essential.
This doesn't mean you shouldn't try? Of course not! The Internet is exploding. The potential is huge. In today's economic climate thousands, if not millions, of people are looking at starting their own Internet business.
And so they should. It was a trend that was in place well before the recession came along and it's a recession proof business.
So what are the difficulties to starting your own business online?
The first is the learning curve - it's steeper than you might think. There are several "how-to" processes online for you to follow. You've got to know which ones to follow.
I sometimes think that letting the newbie loose to find her own way at the start is one of the best ways for her to learn. Might sound harsh, but it works. My advice would be not to spend too much at the start but at least try something. You will learn this way.
Succeeding at creating wealth with an online business requires mastery of several key tasks, not all of which have a direct correlation with an offline business.
First, you need to build a really good website and/or a blog for those who understand social networking. Then you have to drive traffic to it, all without making any mistakes that cause you to lose credibility in your prospect's mind.
Not easy!
Although there are numerous experts, books, and how-to courses on how to start a business online, it's hard for a beginner to know who to believe. In addition, there are multiple online business models to choose from as well. However, as I said before, at some point you just have to jump in and test the water.
The second thing is to drive traffic to your site. Novice Internet marketers know they need their site to be ranked highly by the search engines, but often vastly underestimate the amount of competition they have for the keywords and search phrases they desire.
The reality is that a top-ten ranking for most popular keywords is extraordinarily difficult to achieve. This means that you will need to master the art of advertising online, which can become quite costly.
Thirdly, you need to understand that a lot of information will come your way and it is easy to become overwhelmed.
You might be advised to subscribe to Internet ezines or visit Internet discussion forums. These are recommended methods to build knowledge. However, you will be bombarded almost daily with new ways to make money, new advertising strategies to try, new top-secret, never-before-revealed-to-the-public ways to get more targeted website visitors than you've ever imagined. You can become paralyzed by analysis and end up doing nothing.
I suggest you read internet marketing articles. After a while, you can tell the experienced and genuine authors. That's what you are doing here.
If you're looking at creating wealth with an Internet business, this article will serve as a reality check for you. However, you do need to start somewhere and you will need some start up capital. It's certainly possible to make a substantial income online; however, it's much more likely if you have a good grasp of the obstacles you'll encounter along the way.
Article Source: http://EzineArticles.com/1813979
3 List Building Strategies That Can Change Your Mind then Change Your Life and Build Your Business
Are you trying to build your subscriber list but bewildered by all the traffic building options that are all over the internet.
If you remove the hype from all the individual internet marketers there are essentially a few distinct but easy to follow phases to building your lists with a true opt in process. There are really three phases to list building of an opt-in process and they are:
There are really 3 phases to attracting potential customers, getting them to subscribe and ensuring they become long time customers of your home or solo owned business
1. Uniqueness
2. Distinctive
3. Consistency
1. Be Unique and very much self-aware
Know yourself is simple but hard to do. It is why we all love polls and questionnaires because it gives insight into ourselves. Well we start with this as the key strategy because once you know yourself you can make all else change to meet your needs.
The infrastructure of list building is the same. The process you select will make the difference in your sticking with it on a daily basis.
2. Be Distinctive - have one solid set of processes and strategy
Basic List Building - Foundation Strategies
o You need to learn about building customer database and email broadcasting systems
o You need to learn about an email capture and list building database.
o You will need to know how to write an opt-in web page that works to enforce signups.
o You need to understand the dynamics of a "squeeze page" and how they work.
o You will also need to develop a compelling ezine description
o You also need to know what to put on the "thank you" page and follow
o You will also need to learn what to put into an autoresponder.
3. Be Consistent - stay the course, be in it for the long haul
Like the real estate agents are fond of saying location, location, location. In list building and traffic generation we can say repetition, repetition, repetition. Consistently doing a small boring thing well is better then doing an exciting thing badly.
As an aside, once you get going you will need to learn residual back end income strategies. These consist of more advanced learning like the basics of monetizing your pages. Then you will learn the process of developing your unique way of building additional customer loyalty.
Building your list can be very rewarding and your sales of internet products will increase tremendously. However it is highly recommended that first you learn yourself, second follow a plan and third be consistent.
Article Source: http://EzineArticles.com/1032178
If you remove the hype from all the individual internet marketers there are essentially a few distinct but easy to follow phases to building your lists with a true opt in process. There are really three phases to list building of an opt-in process and they are:
There are really 3 phases to attracting potential customers, getting them to subscribe and ensuring they become long time customers of your home or solo owned business
1. Uniqueness
2. Distinctive
3. Consistency
1. Be Unique and very much self-aware
Know yourself is simple but hard to do. It is why we all love polls and questionnaires because it gives insight into ourselves. Well we start with this as the key strategy because once you know yourself you can make all else change to meet your needs.
The infrastructure of list building is the same. The process you select will make the difference in your sticking with it on a daily basis.
2. Be Distinctive - have one solid set of processes and strategy
Basic List Building - Foundation Strategies
o You need to learn about building customer database and email broadcasting systems
o You need to learn about an email capture and list building database.
o You will need to know how to write an opt-in web page that works to enforce signups.
o You need to understand the dynamics of a "squeeze page" and how they work.
o You will also need to develop a compelling ezine description
o You also need to know what to put on the "thank you" page and follow
o You will also need to learn what to put into an autoresponder.
3. Be Consistent - stay the course, be in it for the long haul
Like the real estate agents are fond of saying location, location, location. In list building and traffic generation we can say repetition, repetition, repetition. Consistently doing a small boring thing well is better then doing an exciting thing badly.
As an aside, once you get going you will need to learn residual back end income strategies. These consist of more advanced learning like the basics of monetizing your pages. Then you will learn the process of developing your unique way of building additional customer loyalty.
Building your list can be very rewarding and your sales of internet products will increase tremendously. However it is highly recommended that first you learn yourself, second follow a plan and third be consistent.
Article Source: http://EzineArticles.com/1032178
How To Build A Business Web Site - Some Tips For The Best Software To Help
Owning your own business and being your own boss is the core concept of the American Dream and the Internet and World Wide Web revolution make this dream easier to grasp than ever for anyone with a computer and a willingness to set up and build a business web site.
Doing business on the web is all about conveying information about your products and services to potential buyers.
You need to make your web site attractive and it needs to stand out from the crowd in your product area. Remember, while you know how awesome your product is, the typical web surfer can only take you at your word – and your word will be judged by how your web site presents itself.
Does your web site have a “landing page” – the page where people will go to when brought to your site by Google or other search engines? This is where your customers make their first impression.
This page should be free of typos, it should present the most important information in the top few paragraphs and it should display your company’s logo and graphical elements promptly (small graphics file sizes) and prominently (upper part of the page.)
Getting good graphics for your landing page is tricky – you can either spend a lot of money on Photoshop and a lot of time learning it or you can use pre-packaged templates, which have a tendency to all look alike.
One alternative is hiring a graphic designer, but graphic designers are expensive and can flake out on you. If you have the patience to learn a graphics program, another alternative is to have someone teach you how to do a good graphic design for your business web site.
Fortunately, Design Dashboard does an excellent job in walking you through tutorials with a graphics program, highlighting the tips you need to make your business web site stand head and shoulders above the crowd.
Peter Cutforth and his team have built literally hundreds of niche websites for clients all around the world. Visit Peter's blog To Discover How to Point ‘n Click Your Way To Create Amazing Web Pages That Sell Like Crazy!
Article Source: http://EzineArticles.com/402577
Doing business on the web is all about conveying information about your products and services to potential buyers.
You need to make your web site attractive and it needs to stand out from the crowd in your product area. Remember, while you know how awesome your product is, the typical web surfer can only take you at your word – and your word will be judged by how your web site presents itself.
Does your web site have a “landing page” – the page where people will go to when brought to your site by Google or other search engines? This is where your customers make their first impression.
This page should be free of typos, it should present the most important information in the top few paragraphs and it should display your company’s logo and graphical elements promptly (small graphics file sizes) and prominently (upper part of the page.)
Getting good graphics for your landing page is tricky – you can either spend a lot of money on Photoshop and a lot of time learning it or you can use pre-packaged templates, which have a tendency to all look alike.
One alternative is hiring a graphic designer, but graphic designers are expensive and can flake out on you. If you have the patience to learn a graphics program, another alternative is to have someone teach you how to do a good graphic design for your business web site.
Fortunately, Design Dashboard does an excellent job in walking you through tutorials with a graphics program, highlighting the tips you need to make your business web site stand head and shoulders above the crowd.
Peter Cutforth and his team have built literally hundreds of niche websites for clients all around the world. Visit Peter's blog To Discover How to Point ‘n Click Your Way To Create Amazing Web Pages That Sell Like Crazy!
Article Source: http://EzineArticles.com/402577
Start Your Own Business in a Easier Way
More people are going into business. However, many are not mentally prepared. Many are lacking the business knowledge when they first start their business. You can get some key points here in starting your own business.
1. Watch your cashflow
Cashflow is the bloodline of your business. Most businesses fail because they run into cashflow problems. Most new business owners start to spend lots of money before the business starts making money.
Spending money on renovating luxury offices, buying unnecessary things or renting too big an office space. Even buying small items can bring huge burden to your to your cashflow.
If you are not someone who is good at managing cashflow, get someone who is good to do it for you. My business partner is good at that, she is the one who manages all the money in the company.
In the first year of our business, she had stopped me numerous times in buying unnecessary things.
Learn to watch your cashflow. Your business depends on it.
2. Marketing business
When I was young, someone told me this, "as long as you start a business, they will come and you will be rich." That may be true many years ago. But it's no longer true now.
When you start your business, you must make known to the world. Tell everyone about your business. Learn to do effective marketing not just marketing that everyone else does.
All businesses are in the business of marketing. If you sell pens, you are also in the business of marketing. Just that you are marketing pens.
Marketing is a huge subject. Many business owners start business without knowing even the basic of marketing. I done lots of test about marketing. I started to learn about marketing five years ago. Only in the last years, I discover I had moved to a deeper level in understanding marketing.
3. Negotiate, Negotiate, Negotiate
Learn this skill and you can get many good deals. You may even get people who's willing to work for you free. A tip for you before going into a negotiation is to understand what the other party wants. Know that and you'll find your negotiation goes much smoother.
Understand this point, negotiation is about win-win. Creating a win-win deal in a negotiation. If a negotiation turns to win-lose, one party will definitely walk away from the deal.
4. Taking care of your customers
You have to think your customers as long term friends. If you take care of your customers, they will take care of you. Build trust and rapport with your customers, they will buy from you for a life time.
Build a system so that you can always keep in touch with your customers. When your business grows, you do not have the time to keep in touch with all of your customers. That's when this system will come in handy. Build it early, so you will not lose any customers.
Get yourself prepared for a new business. Be mentally prepared, physically prepared too. You will find great success in your business if you are prepared.
Article Source: http://EzineArticles.com/350223
1. Watch your cashflow
Cashflow is the bloodline of your business. Most businesses fail because they run into cashflow problems. Most new business owners start to spend lots of money before the business starts making money.
Spending money on renovating luxury offices, buying unnecessary things or renting too big an office space. Even buying small items can bring huge burden to your to your cashflow.
If you are not someone who is good at managing cashflow, get someone who is good to do it for you. My business partner is good at that, she is the one who manages all the money in the company.
In the first year of our business, she had stopped me numerous times in buying unnecessary things.
Learn to watch your cashflow. Your business depends on it.
2. Marketing business
When I was young, someone told me this, "as long as you start a business, they will come and you will be rich." That may be true many years ago. But it's no longer true now.
When you start your business, you must make known to the world. Tell everyone about your business. Learn to do effective marketing not just marketing that everyone else does.
All businesses are in the business of marketing. If you sell pens, you are also in the business of marketing. Just that you are marketing pens.
Marketing is a huge subject. Many business owners start business without knowing even the basic of marketing. I done lots of test about marketing. I started to learn about marketing five years ago. Only in the last years, I discover I had moved to a deeper level in understanding marketing.
3. Negotiate, Negotiate, Negotiate
Learn this skill and you can get many good deals. You may even get people who's willing to work for you free. A tip for you before going into a negotiation is to understand what the other party wants. Know that and you'll find your negotiation goes much smoother.
Understand this point, negotiation is about win-win. Creating a win-win deal in a negotiation. If a negotiation turns to win-lose, one party will definitely walk away from the deal.
4. Taking care of your customers
You have to think your customers as long term friends. If you take care of your customers, they will take care of you. Build trust and rapport with your customers, they will buy from you for a life time.
Build a system so that you can always keep in touch with your customers. When your business grows, you do not have the time to keep in touch with all of your customers. That's when this system will come in handy. Build it early, so you will not lose any customers.
Get yourself prepared for a new business. Be mentally prepared, physically prepared too. You will find great success in your business if you are prepared.
Article Source: http://EzineArticles.com/350223
Book Review: Start Your Own Business
If you want to start a business, but don't know where to start, then the place to start is with Start Your Own Business: The Only Start-Up Book You'll Ever Need by Rieva Lesonsky.
The book is put out by Entrepreneur Press and is essentially a compilation of Entrepreneur Magazine's large knowledge database regarding starting a business.
The book literally takes you through the entire business process - from determining if you really have what it takes to run a business to how to deal with failure if your business doesn't work out, and everything in between.
The best part about the book is that it covers nearly EVERYTHING in some capacity. If you need more information, it does a great job of suggesting further reading and pertinent web sites.
The book is broken down into seven sections, each with several chapters. The first section, 'You Gotta Start Somewhere' covers determining if you can be an entrepreneur, how to come up with an idea for your business, and whether you should launch your business part time or full time.
Most people who buy the book will already have answers to these questions, but going through the exercises in the book can still be helpful.
The second section of the book is entitled 'Building Blocks'. It covers how to name your business, choosing a business structure, creating a business plan, and how to hire a lawyer and accountant. I think that this is the most valuable section of the book. These are the things that most entrepreneurs either struggle with or ignore.
The Naming Your Business chapter in particular helped me a great deal. Naming your business is not nearly as easy as you think - you need to consider all registered trademark names, registered domain names, and names that are being used but not trademarked.
One of the worst things that you can do is to pick a name that is already being used by someone and face a legal battle down the road.
The third section covers financing including where and how to get money to run your business. The fourth section, 'Setting the Stage' is absolutely massive and covers numerous important things such as choosing a location for your business, creating a professional image, offering customers credit, hiring your first employee, and business insurance. Needless to say, all of these things are extremely important to every business owner.
The fifth section covers buying company computers, cell phones, and cars. These things probably won't be very difficult for most business owners.
The sixth section, however, covers one of the hardest thing every business owner faces - marketing. The section is nearly 100 pages about advertising, marketing, and public relations. It also briefly touches on web-marketing but those looking to seriously profit online will need to look elsewhere because the book is a little thin when it comes to e-commerce.
The final section, entitled 'By the Books' goes over every entrepreneurs favorite things - accounting and taxes. It gives solid advice regarding basic bookkeeping, financial statements, budgeting, and taxes. For most business owners this section and the web resources listed should be more than enough to get them started on keeping their business legal.
I can't overemphasize how important I think it is for every business owner to have this book. It is a mini-encyclopedia (ok, so 800 pages isn't THAT mini) for everything business related. Having this book on your shelf will save you countless hours. I read it from cover to cover when I got it and I constantly refer back to it. I have recommended it to every person I know that has talked with me about starting a business. Each and every one of them bought it, and each and every one of them came back to me raving about it.
For the amount of depth that is covered in the book, Start Your Own Business: The Only Start-Up Book You'll Ever Need by Rieva Lesonsky is an amazingly easy read. Anyone over the age of 16 will be able to comprehend the simple nature of the book.
Reading this book won't guarantee your success as an entrepreneur, but it will help reduce the risk of starting a business by providing you with a sound foundation to build upon.
Adam McFarland owns the SportsLizard.com Network [http://network.sportslizard.com] - a network of sports sites including collectibles, movies, books, video games, and more.
Article Source: http://EzineArticles.com/177124
The book is put out by Entrepreneur Press and is essentially a compilation of Entrepreneur Magazine's large knowledge database regarding starting a business.
The book literally takes you through the entire business process - from determining if you really have what it takes to run a business to how to deal with failure if your business doesn't work out, and everything in between.
The best part about the book is that it covers nearly EVERYTHING in some capacity. If you need more information, it does a great job of suggesting further reading and pertinent web sites.
The book is broken down into seven sections, each with several chapters. The first section, 'You Gotta Start Somewhere' covers determining if you can be an entrepreneur, how to come up with an idea for your business, and whether you should launch your business part time or full time.
Most people who buy the book will already have answers to these questions, but going through the exercises in the book can still be helpful.
The second section of the book is entitled 'Building Blocks'. It covers how to name your business, choosing a business structure, creating a business plan, and how to hire a lawyer and accountant. I think that this is the most valuable section of the book. These are the things that most entrepreneurs either struggle with or ignore.
The Naming Your Business chapter in particular helped me a great deal. Naming your business is not nearly as easy as you think - you need to consider all registered trademark names, registered domain names, and names that are being used but not trademarked.
One of the worst things that you can do is to pick a name that is already being used by someone and face a legal battle down the road.
The third section covers financing including where and how to get money to run your business. The fourth section, 'Setting the Stage' is absolutely massive and covers numerous important things such as choosing a location for your business, creating a professional image, offering customers credit, hiring your first employee, and business insurance. Needless to say, all of these things are extremely important to every business owner.
The fifth section covers buying company computers, cell phones, and cars. These things probably won't be very difficult for most business owners.
The sixth section, however, covers one of the hardest thing every business owner faces - marketing. The section is nearly 100 pages about advertising, marketing, and public relations. It also briefly touches on web-marketing but those looking to seriously profit online will need to look elsewhere because the book is a little thin when it comes to e-commerce.
The final section, entitled 'By the Books' goes over every entrepreneurs favorite things - accounting and taxes. It gives solid advice regarding basic bookkeeping, financial statements, budgeting, and taxes. For most business owners this section and the web resources listed should be more than enough to get them started on keeping their business legal.
I can't overemphasize how important I think it is for every business owner to have this book. It is a mini-encyclopedia (ok, so 800 pages isn't THAT mini) for everything business related. Having this book on your shelf will save you countless hours. I read it from cover to cover when I got it and I constantly refer back to it. I have recommended it to every person I know that has talked with me about starting a business. Each and every one of them bought it, and each and every one of them came back to me raving about it.
For the amount of depth that is covered in the book, Start Your Own Business: The Only Start-Up Book You'll Ever Need by Rieva Lesonsky is an amazingly easy read. Anyone over the age of 16 will be able to comprehend the simple nature of the book.
Reading this book won't guarantee your success as an entrepreneur, but it will help reduce the risk of starting a business by providing you with a sound foundation to build upon.
Adam McFarland owns the SportsLizard.com Network [http://network.sportslizard.com] - a network of sports sites including collectibles, movies, books, video games, and more.
Article Source: http://EzineArticles.com/177124
Monday, July 11, 2011
The Importance of Business Plan Organization
Overview
The organization of a Business Plan is very important. I use an eight section plan format that is in a specific order as each section builds from the previous section (note: you may have to jump back and forth on a limited basis between the Products and Services Section and the Marketing Section, as well as, the Strategic Section, depending on the extent of your market and product development to date).
There is fluid thought and connected reasoning employed to achieve a Plan that reaches its intended purpose (i.e. to run a business, to buy a business, to enter a Joint Venture, to finance a business, to complete a particular project, etc).
Although the Executive Summary is the first section of a Plan, it should be written last. All the other Sections should be developed in a build block order provided in a Business Plan Workbook Process.
A Business Plan is a business document; you are not writing prose. It should contain a precise and concise format and be organized into numbered Sections and Sub-Sections, which contain specific information in short, paragraph form.
Plans should be produced in paper form, computer format and online format. Computer Format means the Plan is integrated into the Company's Computer Network. It also means the Table of Content's Sections are hyperlinked so you can easily navigate and access information on the Plan just by clicking on the links.
You should have your Business Plan uploaded securely, online (via login and password access) on your website so that Key Managers, Employees, Sales People, etc can access the information remotely no matter their location. You can have different versions available online for particular purposes, segregated by different logins and passwords.
For Example, you can have your Sales Plan accessible remotely so your Salespeople can use it as a sales tool or update it with up to the minute feedback for the Sales Manager and the Marketing Department. Another example would be having your Funding Business Plan accessible online with versions for different audiences: bankers, venture capitalists, angel investors, etc.
Business Plan Sections
1) Table of Contents
The Table of Contents is one of the most important parts of the Plan. The TOC should be very detailed and well organized so that the reader and user can find and access the information easily and quickly. You can write a great Plan with all the necessary information in it, but if the reader can't easily find or access the information, then the Plan ceases to be a useful tool.
The TOC should be organized by each Section and Sub-Sections of the Plan with the corresponding page numbers. It is strongly recommended that your Plan be developed as an outline document, with all the Sections and Sub-Sections in the Table of Contents hyperlinked to the page where the information resides. This way the reader and user can access the information quickly and easily.
2) Section One: Executive Summary
The Executive Summary should be written last. Why? Because it organizes and summarizes the entire Business Plan. You cannot achieve this effectively until all the other sections (2 thru 8) of the Plan are completed.
We suggest developing two renditions of the Executive Summary - a short version of 2 - 3 pages in length and a longer version of 5 - 7 pages. The short version should be written after the long version is completed, keying on the most significant information from the long version.
The Executive Summary gives the reader a quick overview of the important facts contained in your Business Plan. The long version of the Executive Summary can act as a standalone document to be used to succinctly explain your Business and generate interest in your opportunity, or products and services.
For instance, the long version of the Summary can be sent to a Venture Capital Firm to generate and gauge initial interest, to be accompanied by your one-sheeters: Fact Sheet / Venture Overview / Investment Overview.
If interest is indicated, you can send the VC Firm a custom tailored Funding Business Plan (customized to their particular investment requirements) which will contain the short version Executive Summary.
Brevity, yet completeness and inclusiveness, is key when writing your Executive Summary. It should be concise yet have adequate detail about your Business Plan. It may take several attempts to achieve this balance.
3) Section Two: Company Overview
This section encapsulates who you are as a Company: the History, Structure, Ownership, Locations, Products and Services Summary, Strengths and Weaknesses, Performance, Customers, Trends, Company Assets and so forth.
This section comes first in the Business Plan (following the Executive Summary) since it serves as an introduction to the necessary details and background of your company.
4) Section Three: Management and Operations
This section builds on the Company Section explaining in more detail who will run the company and how it will be run. You can have the greatest business idea but lack the right people to execute your Plan. Therefore, the Management and Operations Section is one of the most important elements of the Plan.
5) Section Four: Products and Services
Now that you have developed the Company and Management / Operations Sections, it is time to describe your Company's Products and Services in detail. This section identifies why your Product and Service is unique and where weaknesses reside.
Customer and Market identification, analysis and segmentation starts in this section to be later developed in the Marketing Plan and implemented through the Strategic Plan.
6) Section Five: Marketing Analysis and Plan
The Marketing Section explains in great detail how your Product and Service will be positioned and distributed in the market, supported by detailed, believable market research.
This section deals with your Industry, Market Segments, Target Markets, Market Trends and Growth, General Competitive Environment, Customer Choices and Competitive Analysis / Positioning / Edge, to culminate in your Marketing Strategy and Programs.
7) Section Six: Strategic & Sales Plan
The Strategic Plan puts the Marketing Plan into action, showing how to implement the Marketing Plan into a cohesive and executable Sales Plan. The Strategic Plan develops a system to effectively deal with Potential Problems and Risks and culminates in producing Company Strategies, Tactics and Strategic Programs.
These programs are implemented through the developed Sales Programs and Sales Plan. Operating Budgets, Control Mechanisms, Milestones and Sales Forecasts are also integral parts of the Strategic Plan.
The Strategic Plan provides a process for Strategic Management, Auditing and Reassessment. It measures performance, has control functions and corrective actions, reassessing when and where necessary. Strategic Planning is top-down and bottom-up, completely integral to your Company's Operations, from the Vision and Leadership of the CEO, to Management's Implementation Oversight, to the Sales and Operations Units.
It provides company-wide Strategic Vision, Focus, Structure and Discipline, while providing an atmosphere of learning and awareness, with a process for identifying deficiencies and, in turn, fixing those challenges.
8 ) Section Seven: Financials
If you develop an effective Strategic Plan through our a well prescribed process, completing the Financial Section will not be as difficult as often anticipated. The principal reason why business owners have such a hard time constructing the Financial Section is most often due to a cursory job on their Strategic Planning Process.
Financial Projections are not believable or realistic when the Strategic Plan doesn't do an adequate job of harnessing the Market Plan into an achievable well thought out Company Strategy. Good Financial Forecasting starts with a well developed Product or Service Plan (Section 4), a well researched Market Analysis and resulting Marketing Plan (Section 5) and culminating into a solid Strategic Planning Process (Section 6).
This ensures your "best guesses" as to future performance are well researched and developed. This is why it is so critical that you work through a good Business Planning Workbook in a building block order; otherwise, your Financials will be lacking accurate forecasting. The culmination of a good Strategic Planning Process makes for solid Financial Projections.
Probably the most important of all the Financials is the Cash Flow Statement. The Cash Flow will assist you on a daily basis in running your business effectively. Simply put, the Cash Flow shows the influx of cash and the outflow of cash in your Business.
Cash Management is absolutely critical in successfully running your business, project or venture. The Cash Flow Statement is also very important when you are seeking funding for your operation and analyzed closely by lenders, investors and venture capitalists alike.
Your Cash Flow is also critically important to your relationship with your Suppliers. Having a Supplier Business Plan containing a history and projection of Cash Flow can really help your Suppliers become good partners in managing your cash flow, thereby, enhancing your profitability significantly.
The Cash Flow Statement should be your guiding force in Financial Modeling and Cash Management. Effectively managing your Cash creates leverage, which will lead toward increased profitability. The leverage is created within a Cash Flow Management System as it shows how much cash is necessary to grow and finance your Company.
Many businesses focus on the Profit and Loss Statement, which is very important; however, they often over look the Cash Flow Statement. Good financial analysis focuses on the Cash Flow Statement, then relates it to the Profit & Loss components (i.e. minimizing costs), which in turn increases Profitability and results in a stronger asset and equity base on the Balance Sheet.
Financials and good Financial Management stem from the inter-connectivity of a Company's Financials. Don't forget how important Cash Flow Management is to your Company's future profitability and net worth.
Another very important Financial, which works hand in hand with the Cash Flow Statement and Cash Management, is your Company's Target and Actual Budget. Budgets are used principally for two purposes: Planning and Control.
A Budget matches short term targets with long term Strategic Planning, while providing an indicator of future problems ahead. A good Budgeting System will indicate when Costs and Expenses are heading over Budget (Actual vs. Target), providing the business owner time and opportunity to correct the problem before it significantly affects Cash Flow.
Your Budget is an extension of (and a result of) your Cash Flow Statement, helping you to effectively control and plan your operational cash, costs and expenses.
We recommend Rolling Budgets which look forward 12 months on a monthly basis, budgeting an additional three months at the end of each quarter. This way you always have a 12 month continuous outlook for Planning Purposes, yet provides you real time Cost Basis for Control purposes.
A Budget should be flexible so that you can separate the effects of variations between Actual and Estimated results. Moreover, a Budget is a tool to evaluate your Business Units (Departments) and Management's Performance. Needless to say, assembling a good Budget requires the input of your entire organization, which in turn, is a very good thing.
Just as your Business Plan should be an integral part of your Company's every day operations, so too should your Cash Flow, Cash Management and Budgeting Process be intertwined fully into company operations.
It is important to understand how your Financials relate to each other as you build and develop them. This is why Financial Software Programs are so beneficial, making Financial Analysis, Development and Projections a snap (once you have developed a solid Strategic Plan).
There's a lot of back and forth between the Profit and Loss Statement, Balance Sheet and Cash Flow Statement. When using a Financial Software Program, it is important that the program allows you to customize the Formats for your specific needs and download the Financials into Excel Spreadsheets for maximum utility and flexibility.
When making Financial Projections, the projection period differs for the particular company, venture or project. For instance, a large scale Real Estate Development Project's Cash Flow Projection could be three, five or ten years, depending on the project scope and length.
Also Real Estate Companies and Projects typically require additional Financials, such as, the Construction Cost Analysis and Cash Flow, Schedule of Real Estate, Construction Cost and Disbursement Schedule, and so on (Note: some of these may be applicable to other business sectors as well- for instance, a Tire Distribution Company may have substantial real estate holdings, hence, a Schedule of Real Estate would apply).
Also, for Real Estate Companies and Projects (as well as for companies applying for business finance), the Loan Package is an important aspect of your Business Plan.
A very important component of the Financial Section is the Assumptions sub-section. This details the assumptions you have utilized in developing your financials.
It is important to list the various calculations and formulas used in developing your Financials since those formulas can be company, deal or project specific. Detailed assumptions provide transparency to your Financials.
Financial Projections need to be believable and realistic. If anything, they need to be conservative. Too often we also see extremes of too few numbers or too many numbers. Provide best case, worst case and expected Financial Projections, along with simple and detailed formats.
Remember that if you build out your Financials as a result of a good Strategic Planning Process, the financial results will most likely be believable and realistic as possible. We find that if your Financials have truly conservative numbers (yet still see profitability), you will often exceed your Plan which becomes a great Psychological boost for your Company (and any lenders or investors).
9) Section Eight: Appendix
The Appendix Section of a business plan can be aptly called the Due Diligence section. It contains the "proof in the pudding". It contains all the Bulky Documents which supply merit and proof to your Business Plan's assertions.
Since the Appendix is large in volume, it is important to have a separate Table of Contents with Tabbed Sections for easy reference for this section.
Article Source: http://EzineArticles.com/4103194
The organization of a Business Plan is very important. I use an eight section plan format that is in a specific order as each section builds from the previous section (note: you may have to jump back and forth on a limited basis between the Products and Services Section and the Marketing Section, as well as, the Strategic Section, depending on the extent of your market and product development to date).
There is fluid thought and connected reasoning employed to achieve a Plan that reaches its intended purpose (i.e. to run a business, to buy a business, to enter a Joint Venture, to finance a business, to complete a particular project, etc).
Although the Executive Summary is the first section of a Plan, it should be written last. All the other Sections should be developed in a build block order provided in a Business Plan Workbook Process.
A Business Plan is a business document; you are not writing prose. It should contain a precise and concise format and be organized into numbered Sections and Sub-Sections, which contain specific information in short, paragraph form.
Plans should be produced in paper form, computer format and online format. Computer Format means the Plan is integrated into the Company's Computer Network. It also means the Table of Content's Sections are hyperlinked so you can easily navigate and access information on the Plan just by clicking on the links.
You should have your Business Plan uploaded securely, online (via login and password access) on your website so that Key Managers, Employees, Sales People, etc can access the information remotely no matter their location. You can have different versions available online for particular purposes, segregated by different logins and passwords.
For Example, you can have your Sales Plan accessible remotely so your Salespeople can use it as a sales tool or update it with up to the minute feedback for the Sales Manager and the Marketing Department. Another example would be having your Funding Business Plan accessible online with versions for different audiences: bankers, venture capitalists, angel investors, etc.
Business Plan Sections
1) Table of Contents
The Table of Contents is one of the most important parts of the Plan. The TOC should be very detailed and well organized so that the reader and user can find and access the information easily and quickly. You can write a great Plan with all the necessary information in it, but if the reader can't easily find or access the information, then the Plan ceases to be a useful tool.
The TOC should be organized by each Section and Sub-Sections of the Plan with the corresponding page numbers. It is strongly recommended that your Plan be developed as an outline document, with all the Sections and Sub-Sections in the Table of Contents hyperlinked to the page where the information resides. This way the reader and user can access the information quickly and easily.
2) Section One: Executive Summary
The Executive Summary should be written last. Why? Because it organizes and summarizes the entire Business Plan. You cannot achieve this effectively until all the other sections (2 thru 8) of the Plan are completed.
We suggest developing two renditions of the Executive Summary - a short version of 2 - 3 pages in length and a longer version of 5 - 7 pages. The short version should be written after the long version is completed, keying on the most significant information from the long version.
The Executive Summary gives the reader a quick overview of the important facts contained in your Business Plan. The long version of the Executive Summary can act as a standalone document to be used to succinctly explain your Business and generate interest in your opportunity, or products and services.
For instance, the long version of the Summary can be sent to a Venture Capital Firm to generate and gauge initial interest, to be accompanied by your one-sheeters: Fact Sheet / Venture Overview / Investment Overview.
If interest is indicated, you can send the VC Firm a custom tailored Funding Business Plan (customized to their particular investment requirements) which will contain the short version Executive Summary.
Brevity, yet completeness and inclusiveness, is key when writing your Executive Summary. It should be concise yet have adequate detail about your Business Plan. It may take several attempts to achieve this balance.
3) Section Two: Company Overview
This section encapsulates who you are as a Company: the History, Structure, Ownership, Locations, Products and Services Summary, Strengths and Weaknesses, Performance, Customers, Trends, Company Assets and so forth.
This section comes first in the Business Plan (following the Executive Summary) since it serves as an introduction to the necessary details and background of your company.
4) Section Three: Management and Operations
This section builds on the Company Section explaining in more detail who will run the company and how it will be run. You can have the greatest business idea but lack the right people to execute your Plan. Therefore, the Management and Operations Section is one of the most important elements of the Plan.
5) Section Four: Products and Services
Now that you have developed the Company and Management / Operations Sections, it is time to describe your Company's Products and Services in detail. This section identifies why your Product and Service is unique and where weaknesses reside.
Customer and Market identification, analysis and segmentation starts in this section to be later developed in the Marketing Plan and implemented through the Strategic Plan.
6) Section Five: Marketing Analysis and Plan
The Marketing Section explains in great detail how your Product and Service will be positioned and distributed in the market, supported by detailed, believable market research.
This section deals with your Industry, Market Segments, Target Markets, Market Trends and Growth, General Competitive Environment, Customer Choices and Competitive Analysis / Positioning / Edge, to culminate in your Marketing Strategy and Programs.
7) Section Six: Strategic & Sales Plan
The Strategic Plan puts the Marketing Plan into action, showing how to implement the Marketing Plan into a cohesive and executable Sales Plan. The Strategic Plan develops a system to effectively deal with Potential Problems and Risks and culminates in producing Company Strategies, Tactics and Strategic Programs.
These programs are implemented through the developed Sales Programs and Sales Plan. Operating Budgets, Control Mechanisms, Milestones and Sales Forecasts are also integral parts of the Strategic Plan.
The Strategic Plan provides a process for Strategic Management, Auditing and Reassessment. It measures performance, has control functions and corrective actions, reassessing when and where necessary. Strategic Planning is top-down and bottom-up, completely integral to your Company's Operations, from the Vision and Leadership of the CEO, to Management's Implementation Oversight, to the Sales and Operations Units.
It provides company-wide Strategic Vision, Focus, Structure and Discipline, while providing an atmosphere of learning and awareness, with a process for identifying deficiencies and, in turn, fixing those challenges.
8 ) Section Seven: Financials
If you develop an effective Strategic Plan through our a well prescribed process, completing the Financial Section will not be as difficult as often anticipated. The principal reason why business owners have such a hard time constructing the Financial Section is most often due to a cursory job on their Strategic Planning Process.
Financial Projections are not believable or realistic when the Strategic Plan doesn't do an adequate job of harnessing the Market Plan into an achievable well thought out Company Strategy. Good Financial Forecasting starts with a well developed Product or Service Plan (Section 4), a well researched Market Analysis and resulting Marketing Plan (Section 5) and culminating into a solid Strategic Planning Process (Section 6).
This ensures your "best guesses" as to future performance are well researched and developed. This is why it is so critical that you work through a good Business Planning Workbook in a building block order; otherwise, your Financials will be lacking accurate forecasting. The culmination of a good Strategic Planning Process makes for solid Financial Projections.
Probably the most important of all the Financials is the Cash Flow Statement. The Cash Flow will assist you on a daily basis in running your business effectively. Simply put, the Cash Flow shows the influx of cash and the outflow of cash in your Business.
Cash Management is absolutely critical in successfully running your business, project or venture. The Cash Flow Statement is also very important when you are seeking funding for your operation and analyzed closely by lenders, investors and venture capitalists alike.
Your Cash Flow is also critically important to your relationship with your Suppliers. Having a Supplier Business Plan containing a history and projection of Cash Flow can really help your Suppliers become good partners in managing your cash flow, thereby, enhancing your profitability significantly.
The Cash Flow Statement should be your guiding force in Financial Modeling and Cash Management. Effectively managing your Cash creates leverage, which will lead toward increased profitability. The leverage is created within a Cash Flow Management System as it shows how much cash is necessary to grow and finance your Company.
Many businesses focus on the Profit and Loss Statement, which is very important; however, they often over look the Cash Flow Statement. Good financial analysis focuses on the Cash Flow Statement, then relates it to the Profit & Loss components (i.e. minimizing costs), which in turn increases Profitability and results in a stronger asset and equity base on the Balance Sheet.
Financials and good Financial Management stem from the inter-connectivity of a Company's Financials. Don't forget how important Cash Flow Management is to your Company's future profitability and net worth.
Another very important Financial, which works hand in hand with the Cash Flow Statement and Cash Management, is your Company's Target and Actual Budget. Budgets are used principally for two purposes: Planning and Control.
A Budget matches short term targets with long term Strategic Planning, while providing an indicator of future problems ahead. A good Budgeting System will indicate when Costs and Expenses are heading over Budget (Actual vs. Target), providing the business owner time and opportunity to correct the problem before it significantly affects Cash Flow.
Your Budget is an extension of (and a result of) your Cash Flow Statement, helping you to effectively control and plan your operational cash, costs and expenses.
We recommend Rolling Budgets which look forward 12 months on a monthly basis, budgeting an additional three months at the end of each quarter. This way you always have a 12 month continuous outlook for Planning Purposes, yet provides you real time Cost Basis for Control purposes.
A Budget should be flexible so that you can separate the effects of variations between Actual and Estimated results. Moreover, a Budget is a tool to evaluate your Business Units (Departments) and Management's Performance. Needless to say, assembling a good Budget requires the input of your entire organization, which in turn, is a very good thing.
Just as your Business Plan should be an integral part of your Company's every day operations, so too should your Cash Flow, Cash Management and Budgeting Process be intertwined fully into company operations.
It is important to understand how your Financials relate to each other as you build and develop them. This is why Financial Software Programs are so beneficial, making Financial Analysis, Development and Projections a snap (once you have developed a solid Strategic Plan).
There's a lot of back and forth between the Profit and Loss Statement, Balance Sheet and Cash Flow Statement. When using a Financial Software Program, it is important that the program allows you to customize the Formats for your specific needs and download the Financials into Excel Spreadsheets for maximum utility and flexibility.
When making Financial Projections, the projection period differs for the particular company, venture or project. For instance, a large scale Real Estate Development Project's Cash Flow Projection could be three, five or ten years, depending on the project scope and length.
Also Real Estate Companies and Projects typically require additional Financials, such as, the Construction Cost Analysis and Cash Flow, Schedule of Real Estate, Construction Cost and Disbursement Schedule, and so on (Note: some of these may be applicable to other business sectors as well- for instance, a Tire Distribution Company may have substantial real estate holdings, hence, a Schedule of Real Estate would apply).
Also, for Real Estate Companies and Projects (as well as for companies applying for business finance), the Loan Package is an important aspect of your Business Plan.
A very important component of the Financial Section is the Assumptions sub-section. This details the assumptions you have utilized in developing your financials.
It is important to list the various calculations and formulas used in developing your Financials since those formulas can be company, deal or project specific. Detailed assumptions provide transparency to your Financials.
Financial Projections need to be believable and realistic. If anything, they need to be conservative. Too often we also see extremes of too few numbers or too many numbers. Provide best case, worst case and expected Financial Projections, along with simple and detailed formats.
Remember that if you build out your Financials as a result of a good Strategic Planning Process, the financial results will most likely be believable and realistic as possible. We find that if your Financials have truly conservative numbers (yet still see profitability), you will often exceed your Plan which becomes a great Psychological boost for your Company (and any lenders or investors).
9) Section Eight: Appendix
The Appendix Section of a business plan can be aptly called the Due Diligence section. It contains the "proof in the pudding". It contains all the Bulky Documents which supply merit and proof to your Business Plan's assertions.
Since the Appendix is large in volume, it is important to have a separate Table of Contents with Tabbed Sections for easy reference for this section.
Article Source: http://EzineArticles.com/4103194
Do Not Do A Business Plan At Your Own Peril
Such a plan seems to be one of the accepted norms of going into business. As with most things in life, one should question this.
Let us start by establishing what a business plan is and why one would need one. A business plan in the most simple terms is a document which lays out a plan as to where one wants a business to be in a set period of time - generally this is 5 years.
It is drawn up by the businesses management or owner. It is a document that lays out the plans for the future and the standards for success. It is thus quite a positive document as one plans for success and not failure.
One of the most popular ways of drawing up such a plan in this day and age is to use software to guide one in setting up the plan.
While this probably creates the best looking and presentable business plan, it possibly allows one to miss the most important reason to set up a business plan. While appearing very comprehensive, all businesses are unique in some way and therefore do not fit exactly in a mould.
One of the most important reasons to do a plan is that it requires one to stop, think, gather more information, think some more and document ones thoughts and plans in an orderly manner. Thinking is the key word.
Business software often demands information, in a particular format, and one lands up focusing on the tool (i.e. the software) and not the process. The process is the most important by far. On the plus side, the software is very structured and would cover all the main topics e.g. financial, marketing, operations, staffing.
A criticism of business plans is that they are often done for financiers and once done and the finance arranged, they are put in a bottom drawer and not referred to again in a hurry. While this is not ideal, it does not mean that the plan is a failure.
It has allowed the business manager time to think through the business in a structured way that has convinced outsiders to buy into the plan - otherwise finance would not have been forthcoming. This is a big positive and should give the manager motivation to go forward.
To run a successful business one, in any event, needs elements of a business plan - financial reports, budgets, cash flows, sales targets and the like.
Article Source: http://EzineArticles.com/6335703
Let us start by establishing what a business plan is and why one would need one. A business plan in the most simple terms is a document which lays out a plan as to where one wants a business to be in a set period of time - generally this is 5 years.
It is drawn up by the businesses management or owner. It is a document that lays out the plans for the future and the standards for success. It is thus quite a positive document as one plans for success and not failure.
One of the most popular ways of drawing up such a plan in this day and age is to use software to guide one in setting up the plan.
While this probably creates the best looking and presentable business plan, it possibly allows one to miss the most important reason to set up a business plan. While appearing very comprehensive, all businesses are unique in some way and therefore do not fit exactly in a mould.
One of the most important reasons to do a plan is that it requires one to stop, think, gather more information, think some more and document ones thoughts and plans in an orderly manner. Thinking is the key word.
Business software often demands information, in a particular format, and one lands up focusing on the tool (i.e. the software) and not the process. The process is the most important by far. On the plus side, the software is very structured and would cover all the main topics e.g. financial, marketing, operations, staffing.
A criticism of business plans is that they are often done for financiers and once done and the finance arranged, they are put in a bottom drawer and not referred to again in a hurry. While this is not ideal, it does not mean that the plan is a failure.
It has allowed the business manager time to think through the business in a structured way that has convinced outsiders to buy into the plan - otherwise finance would not have been forthcoming. This is a big positive and should give the manager motivation to go forward.
To run a successful business one, in any event, needs elements of a business plan - financial reports, budgets, cash flows, sales targets and the like.
Article Source: http://EzineArticles.com/6335703
The Perfect Example of a Restaurant Business Plan
The perfect example of a restaurant business plan does not exist for the simple reason that each plan is required to be different from the next since they all are written for different places. They all follow the same restaurant business plan outline but each one has different words and in many ways correctly is a unique reflection of the personality and spirit of the person who wrote it.
You do not want your plan to sound like a canned speech or a cut and paste job that is not really who you are because the investors or lenders will not be inspired by this at all.
You want them to know that you understand the business and the way you show that is by doing the research for the plan and gathering the information and writing it down in an organized way. Once you have done this yourself you will see there is no point in having the example since you are already done.
Restaurant business plan financials are the real key to getting any restaurant up and launched. You can have an amazing written business plan but without numbers to back up all the great sounding text you won't be able to convince anyone to lend you money or invest real capital into the plan.
The financials package consists of three different types of projections. The first is the balance sheet which shows the assets of the business such as cash, inventory and equipment and the liabilities including any debt and depreciation and amortization charges.
The second is the income statement, also called the profit and loss statement, which details the sales, expenses and any remaining balance which are the profits. The third statement is the cash flow which shows the actual movement of dollars into and out of the business.
These three, plus some supporting financials such as ratios and charts and graphs comprise the plan financials and are the most important part of the presentation of the business plan.
Article Source: http://EzineArticles.com/5815349
You do not want your plan to sound like a canned speech or a cut and paste job that is not really who you are because the investors or lenders will not be inspired by this at all.
You want them to know that you understand the business and the way you show that is by doing the research for the plan and gathering the information and writing it down in an organized way. Once you have done this yourself you will see there is no point in having the example since you are already done.
Restaurant business plan financials are the real key to getting any restaurant up and launched. You can have an amazing written business plan but without numbers to back up all the great sounding text you won't be able to convince anyone to lend you money or invest real capital into the plan.
The financials package consists of three different types of projections. The first is the balance sheet which shows the assets of the business such as cash, inventory and equipment and the liabilities including any debt and depreciation and amortization charges.
The second is the income statement, also called the profit and loss statement, which details the sales, expenses and any remaining balance which are the profits. The third statement is the cash flow which shows the actual movement of dollars into and out of the business.
These three, plus some supporting financials such as ratios and charts and graphs comprise the plan financials and are the most important part of the presentation of the business plan.
Article Source: http://EzineArticles.com/5815349
Financial Advisor Business Plans - Choosing Customer Segments
Depending on the customer market segment or segments you seek to serve with your financial advisory business, your operations and marketing must be different.
Think about which segments you are best suited to serve, as well as the difficulties you may encounter as you try to serve the needs of more than one of these groups.
HNWIs
High net worth individuals, called HNWIs, are generally defined as having assets of over $1 million ready to invest. If your fees will be earned based on the value of assets under management, it is certainly in your interest to seek out and work with as many HNWIs as possible if you are qualified to do so.
Keep in mind that each individual will need more attention and service than an individual with less money to work with, but it should work out to a more profitable relationship nonetheless. To attract these individuals, evidence of your expertise and experience with large accounts will go a long way, as will positive references from past clients.
You may be called on to go out of your way to serve these individuals - making house calls, interrupting your vacation to answer a question, and keeping in steady contact to reassure them that you are keeping an eye on their accounts.
Smaller Investors
For the much larger target market of investors with assets of under $1 million, you have the challenge of working with them enough to make sure they feel well-attended to, while carefully setting the expectation that there are limits to the time you will spend with them. More mass marketing techniques like advertising, as well as referrals, can work to find these types of clients.
Hourly Rate Customers
If you seek to serve those who are getting ready to enter the investment market or begin their financial planning, you'll find a large group more comfortable with paying an hourly rate for advisory services before investing money through you.
Think hard about whether this group will represent a large amount of your revenue or if you will consider the hourly rate offer primarily a means to up sell customers to other services you offer.
If the latter is your strategy, remember that customers can generally sense when they are being sold to and that receiving advice of value may be the best way to encourage them to work with you further.
Article Source: http://EzineArticles.com/2608041
Think about which segments you are best suited to serve, as well as the difficulties you may encounter as you try to serve the needs of more than one of these groups.
HNWIs
High net worth individuals, called HNWIs, are generally defined as having assets of over $1 million ready to invest. If your fees will be earned based on the value of assets under management, it is certainly in your interest to seek out and work with as many HNWIs as possible if you are qualified to do so.
Keep in mind that each individual will need more attention and service than an individual with less money to work with, but it should work out to a more profitable relationship nonetheless. To attract these individuals, evidence of your expertise and experience with large accounts will go a long way, as will positive references from past clients.
You may be called on to go out of your way to serve these individuals - making house calls, interrupting your vacation to answer a question, and keeping in steady contact to reassure them that you are keeping an eye on their accounts.
Smaller Investors
For the much larger target market of investors with assets of under $1 million, you have the challenge of working with them enough to make sure they feel well-attended to, while carefully setting the expectation that there are limits to the time you will spend with them. More mass marketing techniques like advertising, as well as referrals, can work to find these types of clients.
Hourly Rate Customers
If you seek to serve those who are getting ready to enter the investment market or begin their financial planning, you'll find a large group more comfortable with paying an hourly rate for advisory services before investing money through you.
Think hard about whether this group will represent a large amount of your revenue or if you will consider the hourly rate offer primarily a means to up sell customers to other services you offer.
If the latter is your strategy, remember that customers can generally sense when they are being sold to and that receiving advice of value may be the best way to encourage them to work with you further.
Article Source: http://EzineArticles.com/2608041
Business Plan Financial Projections: Stop Worrying About Being Right...
Business plan financial projections seem daunting because
they are so uncertain. This very uncertainty, however, is
what makes preparing them easy because you can't possibly be
right.
You can't predict the future. None of us can. All you
can be is competent in the way you prepare your business plan
projections.
Before you finalize your business plan this year, consider
these six caveats to preparing your business plan financial
projections:
1. Don't offer pull-out-of-the-air, "conservative"
guesstimates about getting some percentage of the overall
market demand or year-over-year growth.
It is a mistake to assume that business investors will
appreciate your being conservative with your business plan
financial projections in the early years of your business.
Don't think for a Wall Street minute that presenting
"conservative" business plan financial projections indicates
"realism" to prospective business investors.
Business investors
invest for one reason: to earn a return on their money. How
long the money is invested influences the amount of the return
earned.
Let's say a business investor wants to triple an
investment. Well, if that investment triples in 3 years, the
return is 44%. If it triples in five years, the return is
25%.
Adding just two years to the investment period nearly
halves the return! Now do you see why time is so important
to a business investor? Here are a few other examples: let's
say a business investor wants to:
Make 5 times an investment in 3 years = 71% return
Make 5 times an investment in 5 years = 38% return
Make 7 times an investment in 3 years = 91% return
Make 7 times an investment in 5 years = 48% return
Make 10 times an investment in 3 years = 115% return
Make 10 times an investment in 5 years = 59% return
So, while you may find it attractive to figure out how to
make "just a living" until the business venture proves
itself, you now understand why business investors want sales
and earnings to grow absolutely as fast as possible, without
being deceived, in your business plan financial projections.
On the whole, business investors are risk averse only to the
extent that they don't want to lose their money or tie it up
in a low return investment. Typically when you make the claim
that your business plan financial projections are "conservative",
it usually just means that you have no idea how and why you'll
achieve a certain level of sales within a certain time frame.
Interesting, these kinds of estimates, provided that you've
done some good thinking about market segments and overall
demand, often turn out to be too low. Remember, it's just as
bad to underestimate your sales, as it is to overestimate
them.
2. Avoid calculating costs as a straight percentage of
revenues.
Sure it's easier to do things this way, especially with
Excel and other business plan financial projection software.
Costs are real, however.
You need to know what they are very
specifically. If you've done your homework in developing
your business plan, then you should already have this information,
or at least the basis of it. Just estimate and calculate your
costs on a product-by-product basis.
With these warnings in mind, use the following steps to
develop your business plan financial projections:
Think about what percentage of the overall market share your
competitors already own. Assume that they will continue
their present trends in growth. (Note: some competitors may
already be trending down and losing market share.)
Temper
your market share estimates with some discussion of how your
entry into the market will affect these trends. Then,
estimate the percent of total, potential demand that remains
available to you.
Now, based on the limitations of your operations plans,
calculate how much of this remaining available demand you
can achieve. This is a very simple calculation.
Start with
your overall productive unit capacity and factor it by the
expected yield of sellable product, then multiply these unit
sales by their respective selling prices and voila, you have
the revenue numbers for your business plan financial projections.
Let's take an example.
Your research indicates that 2 out of every 10 females age
23 to 55 will under go some type of non-invasive cosmetic
treatment in your area. Your research also shows that this
number is expected to grow 20% each year over the next 5
years. There are 40,000 females in your target market.
You
identified four competitors in your target market. These
four competitors currently handle on average 6 procedures a
day. You plan to start a non-invasive cosmetic treatment
center that uses the most advanced technology and is thus
capable of performing an average of 7 procedures a day.
Using this data you calculate the following statistics
about your market and market potential:
Total market 40,000 females x 20% = 8,000 procedures per
year
4 competitors x 6 procedures x 250 days = 6,000 procedures
per year
Available procedures: 8,000 less 6,000 = 2,000 per year
Your productive capacity: 7 procedures a day x 250 days =
1,750 or 21.875% of the total market. The average selling
price for a procedure is $400. Thus, the revenue for the first
year in your business plan financial projection would be 1,750
procedures times $400 or $700,000.
Now, let's say you're were projecting 2,200 procedures per
year. This would mean that you would have to alter your
operating plan to be able to perform 2,200 procedures. You
would also have to demonstrate how you would capture an
additional 200 procedures from your competitors.
Granted this is an over simplified example, but it should
give you a feel for how this process works.
Regarding price, in most cases you should have a clear idea
of how to price your product or service. There are usually
other, similar products or services out on the market.
Unless your competitive advantage is a cost reduction and/or
unless price is a critical basis of competition, just
estimate the value of your improvement and add it on to the
average price currently offered in the marketplace. In order
to make this estimate, you'll have to be talking to
potential users. Find out what they pay now. Find out how
they feel about the current price. Ask them if they'd be
willing to pay more and how much more. If you ask enough
people, you'll get a general idea.
3. Never determine price on the basis of a margin you think
is attractive.
The market will pay you only for the value you deliver,
which is determined by the consumer paying the final price.
It's easy to make the mistake of thinking that a 20%, 40% or
even a 60% margin is great. Never considering that if the
product or service you're offering provides a real
advantage.
If you do this, you may be grossly
underestimating the price you can get in the marketplace and
underestimating your business plan financial projections.
Consumers don't think in terms of margins. They could care
less about what you ought, "reasonably", to get for your
product. That's why you must find out the most that they'll
pay.
This is the value of your product or service. Come up
with some reasonable basis for determining this real value.
Keep in mind the obvious: If the consumer's value on the
final product or service is less than your cost plus a
reasonable profit to keep your business growing, you're in
trouble.
Your business model will not be sustainable and your
business plan financial projections useless.
Now calculate the costs of manufacturing and distributing
your product. These costs flow directly from your revenues
estimates and operations plan.
How much will it cost to
purchase what equipment and materials, hire what personnel,
engage in what selling efforts, pay what accountants and
lawyers, rent what kind of space and so forth, to achieve
the revenues you're showing in your business plan financial
projections.
You must be very specific. Project your costs
over time. Keep them tied to the units you need to sell to
achieve the revenues in your business plan financial
projections.
Obviously, costs and revenues work hand in hand.
4. Keep your fixed cost low.
Keep in mind that none of these revenues and the cost
estimates are going to be perfectly accurate, which means
the amount of profit or cash available to pay "fixed" cost
isn't going to be accurate either.
As a result, you can lose
your shirt trying to pay for equipment, a receptionist, or
other activities that don't contribute to the sole objective
of making sales. Wherever possible, rent space, rent time on
equipment, answer your own phones, etc.
To the extent that
you keep costs variable in your business plan financial
projections, you can cut back when sales are slower than
expected. It's the worst situation to have a big,
well-furnished office with an expensive secretary who
needs the job, when the money isn't coming in.
High fixed
costs in your business plan financial projections also send
the wrong message to investors that you know more about the
"form" of doing business than about actually making money.
Now pull all your numbers together to prepare the financial
statements that summarize your business plan financial
projections. You need three basic statements: cash flow
analysis, income statements, and balance sheets.
All of
these come directly from the above calculations. Your cash
flow analysis indicates when and what amounts of capital
infusion you'll need to start and sustain your business plan.
Make your income and balance sheet projections on the
assumption that you'll get the capital.
For the first year
or two of your business plan financial projections, present
each of these statements on at least a quarterly basis.
Monthly is best. I suggest doing a 24- or 36-month projection
depending on your growth plans and changes in the industry that
you foresee.
Follow these monthly or quarterly projections with
annual projections till you cover a span of 5 years.
Finally, run through some "what-if" scenarios or sensitivity
analysis. Though you business plan financial projections should
be based on your best, and best-supported estimates of costs
and revenues, you know you can't be 100% right.
That's why it's
important to identify those elements or assumptions of your
business plan financial projections that you feel are most
uncertain. Write out the nature of the uncertainty and the range
you think the estimates will fluctuate up or down.
Then change
the estimates accordingly and re-run all your statements.
Pay close attention to how your business plan financial
projections, especially cash flows, change when you change
each assumption.
This will help you determine how much
"cushion" you have available and, if business isn't going
according to plan, at what point cash will become an issue.
5. Do not simply assume that costs and revenues may be
"off", up or down, by some percentage.
Again, I know that Excel makes it easy to do this. For all
the same reasoning as above, stay focused on the assumptions
and details that make up your business plan financial projections.
It's the details you need to examine for their sensitivity and
their impact on the bottom line.
You only need to alter those
specific items that you're most uncertain about. If it's revenues
that you're worried about, is it the price, the volume, or
both that concerns you most? How big a swing in the estimate
are you worried about, in what direction and why? If it's
your cost projections that are keeping you awake at night,
which cost elements and why? Things like rents and labor
costs can be determined fairly accurately.
But maybe you're
unsure about materials or labor availability or how
efficiently you can produce your products or provide your
services. Maybe you'll have to pay extra to ensure their
availability. This kind of thinking forms the basis for running
"what-if" or sensitivity analysis on your business plan financial
projections.
6.Do not include every possible business
plan financial projection scenario in your business plan.
Both you and your investors need to know what aspects of the
business plan financial projections are most uncertain,
represent the most risk, in what direction, why, and how
they affect the bottom line.
Having hundreds of alternative
scenarios to sort through is like a man with two watches
showing two different times... he never knows what time it is.
Lots of alternative business plan financial projections also
indicate that you're not too sure about anything.
This is an
impossible way to communicate with business investors, manage
your business, or make important decisions. It's much more
effective to identify the risky areas of your plan, tell why
and how they impact the bottom line and what actions you
plan to take if they occur.
This helps you and your business
investors stay focused on the high impact areas and to think
clearly about whether other factors should be considered as
well. It also lends more credibility to your talents and
increases the likelihood of your plan's success.
Finish this discussion with a summary of the critical
aspects of your plan and related contingency plans. If
you've followed all these steps, then you can figure out
what you'll do if your actual performance turns out to be
different than your business plan financial projections.
Remember, you're purpose is to demonstrate to business investors
that you're competent; worrying about protecting their investment
and running a business, not just flying by the seat of your pants.
Article Source: http://EzineArticles.com/18505
they are so uncertain. This very uncertainty, however, is
what makes preparing them easy because you can't possibly be
right.
You can't predict the future. None of us can. All you
can be is competent in the way you prepare your business plan
projections.
Before you finalize your business plan this year, consider
these six caveats to preparing your business plan financial
projections:
1. Don't offer pull-out-of-the-air, "conservative"
guesstimates about getting some percentage of the overall
market demand or year-over-year growth.
It is a mistake to assume that business investors will
appreciate your being conservative with your business plan
financial projections in the early years of your business.
Don't think for a Wall Street minute that presenting
"conservative" business plan financial projections indicates
"realism" to prospective business investors.
Business investors
invest for one reason: to earn a return on their money. How
long the money is invested influences the amount of the return
earned.
Let's say a business investor wants to triple an
investment. Well, if that investment triples in 3 years, the
return is 44%. If it triples in five years, the return is
25%.
Adding just two years to the investment period nearly
halves the return! Now do you see why time is so important
to a business investor? Here are a few other examples: let's
say a business investor wants to:
Make 5 times an investment in 3 years = 71% return
Make 5 times an investment in 5 years = 38% return
Make 7 times an investment in 3 years = 91% return
Make 7 times an investment in 5 years = 48% return
Make 10 times an investment in 3 years = 115% return
Make 10 times an investment in 5 years = 59% return
So, while you may find it attractive to figure out how to
make "just a living" until the business venture proves
itself, you now understand why business investors want sales
and earnings to grow absolutely as fast as possible, without
being deceived, in your business plan financial projections.
On the whole, business investors are risk averse only to the
extent that they don't want to lose their money or tie it up
in a low return investment. Typically when you make the claim
that your business plan financial projections are "conservative",
it usually just means that you have no idea how and why you'll
achieve a certain level of sales within a certain time frame.
Interesting, these kinds of estimates, provided that you've
done some good thinking about market segments and overall
demand, often turn out to be too low. Remember, it's just as
bad to underestimate your sales, as it is to overestimate
them.
2. Avoid calculating costs as a straight percentage of
revenues.
Sure it's easier to do things this way, especially with
Excel and other business plan financial projection software.
Costs are real, however.
You need to know what they are very
specifically. If you've done your homework in developing
your business plan, then you should already have this information,
or at least the basis of it. Just estimate and calculate your
costs on a product-by-product basis.
With these warnings in mind, use the following steps to
develop your business plan financial projections:
Think about what percentage of the overall market share your
competitors already own. Assume that they will continue
their present trends in growth. (Note: some competitors may
already be trending down and losing market share.)
Temper
your market share estimates with some discussion of how your
entry into the market will affect these trends. Then,
estimate the percent of total, potential demand that remains
available to you.
Now, based on the limitations of your operations plans,
calculate how much of this remaining available demand you
can achieve. This is a very simple calculation.
Start with
your overall productive unit capacity and factor it by the
expected yield of sellable product, then multiply these unit
sales by their respective selling prices and voila, you have
the revenue numbers for your business plan financial projections.
Let's take an example.
Your research indicates that 2 out of every 10 females age
23 to 55 will under go some type of non-invasive cosmetic
treatment in your area. Your research also shows that this
number is expected to grow 20% each year over the next 5
years. There are 40,000 females in your target market.
You
identified four competitors in your target market. These
four competitors currently handle on average 6 procedures a
day. You plan to start a non-invasive cosmetic treatment
center that uses the most advanced technology and is thus
capable of performing an average of 7 procedures a day.
Using this data you calculate the following statistics
about your market and market potential:
Total market 40,000 females x 20% = 8,000 procedures per
year
4 competitors x 6 procedures x 250 days = 6,000 procedures
per year
Available procedures: 8,000 less 6,000 = 2,000 per year
Your productive capacity: 7 procedures a day x 250 days =
1,750 or 21.875% of the total market. The average selling
price for a procedure is $400. Thus, the revenue for the first
year in your business plan financial projection would be 1,750
procedures times $400 or $700,000.
Now, let's say you're were projecting 2,200 procedures per
year. This would mean that you would have to alter your
operating plan to be able to perform 2,200 procedures. You
would also have to demonstrate how you would capture an
additional 200 procedures from your competitors.
Granted this is an over simplified example, but it should
give you a feel for how this process works.
Regarding price, in most cases you should have a clear idea
of how to price your product or service. There are usually
other, similar products or services out on the market.
Unless your competitive advantage is a cost reduction and/or
unless price is a critical basis of competition, just
estimate the value of your improvement and add it on to the
average price currently offered in the marketplace. In order
to make this estimate, you'll have to be talking to
potential users. Find out what they pay now. Find out how
they feel about the current price. Ask them if they'd be
willing to pay more and how much more. If you ask enough
people, you'll get a general idea.
3. Never determine price on the basis of a margin you think
is attractive.
The market will pay you only for the value you deliver,
which is determined by the consumer paying the final price.
It's easy to make the mistake of thinking that a 20%, 40% or
even a 60% margin is great. Never considering that if the
product or service you're offering provides a real
advantage.
If you do this, you may be grossly
underestimating the price you can get in the marketplace and
underestimating your business plan financial projections.
Consumers don't think in terms of margins. They could care
less about what you ought, "reasonably", to get for your
product. That's why you must find out the most that they'll
pay.
This is the value of your product or service. Come up
with some reasonable basis for determining this real value.
Keep in mind the obvious: If the consumer's value on the
final product or service is less than your cost plus a
reasonable profit to keep your business growing, you're in
trouble.
Your business model will not be sustainable and your
business plan financial projections useless.
Now calculate the costs of manufacturing and distributing
your product. These costs flow directly from your revenues
estimates and operations plan.
How much will it cost to
purchase what equipment and materials, hire what personnel,
engage in what selling efforts, pay what accountants and
lawyers, rent what kind of space and so forth, to achieve
the revenues you're showing in your business plan financial
projections.
You must be very specific. Project your costs
over time. Keep them tied to the units you need to sell to
achieve the revenues in your business plan financial
projections.
Obviously, costs and revenues work hand in hand.
4. Keep your fixed cost low.
Keep in mind that none of these revenues and the cost
estimates are going to be perfectly accurate, which means
the amount of profit or cash available to pay "fixed" cost
isn't going to be accurate either.
As a result, you can lose
your shirt trying to pay for equipment, a receptionist, or
other activities that don't contribute to the sole objective
of making sales. Wherever possible, rent space, rent time on
equipment, answer your own phones, etc.
To the extent that
you keep costs variable in your business plan financial
projections, you can cut back when sales are slower than
expected. It's the worst situation to have a big,
well-furnished office with an expensive secretary who
needs the job, when the money isn't coming in.
High fixed
costs in your business plan financial projections also send
the wrong message to investors that you know more about the
"form" of doing business than about actually making money.
Now pull all your numbers together to prepare the financial
statements that summarize your business plan financial
projections. You need three basic statements: cash flow
analysis, income statements, and balance sheets.
All of
these come directly from the above calculations. Your cash
flow analysis indicates when and what amounts of capital
infusion you'll need to start and sustain your business plan.
Make your income and balance sheet projections on the
assumption that you'll get the capital.
For the first year
or two of your business plan financial projections, present
each of these statements on at least a quarterly basis.
Monthly is best. I suggest doing a 24- or 36-month projection
depending on your growth plans and changes in the industry that
you foresee.
Follow these monthly or quarterly projections with
annual projections till you cover a span of 5 years.
Finally, run through some "what-if" scenarios or sensitivity
analysis. Though you business plan financial projections should
be based on your best, and best-supported estimates of costs
and revenues, you know you can't be 100% right.
That's why it's
important to identify those elements or assumptions of your
business plan financial projections that you feel are most
uncertain. Write out the nature of the uncertainty and the range
you think the estimates will fluctuate up or down.
Then change
the estimates accordingly and re-run all your statements.
Pay close attention to how your business plan financial
projections, especially cash flows, change when you change
each assumption.
This will help you determine how much
"cushion" you have available and, if business isn't going
according to plan, at what point cash will become an issue.
5. Do not simply assume that costs and revenues may be
"off", up or down, by some percentage.
Again, I know that Excel makes it easy to do this. For all
the same reasoning as above, stay focused on the assumptions
and details that make up your business plan financial projections.
It's the details you need to examine for their sensitivity and
their impact on the bottom line.
You only need to alter those
specific items that you're most uncertain about. If it's revenues
that you're worried about, is it the price, the volume, or
both that concerns you most? How big a swing in the estimate
are you worried about, in what direction and why? If it's
your cost projections that are keeping you awake at night,
which cost elements and why? Things like rents and labor
costs can be determined fairly accurately.
But maybe you're
unsure about materials or labor availability or how
efficiently you can produce your products or provide your
services. Maybe you'll have to pay extra to ensure their
availability. This kind of thinking forms the basis for running
"what-if" or sensitivity analysis on your business plan financial
projections.
6.Do not include every possible business
plan financial projection scenario in your business plan.
Both you and your investors need to know what aspects of the
business plan financial projections are most uncertain,
represent the most risk, in what direction, why, and how
they affect the bottom line.
Having hundreds of alternative
scenarios to sort through is like a man with two watches
showing two different times... he never knows what time it is.
Lots of alternative business plan financial projections also
indicate that you're not too sure about anything.
This is an
impossible way to communicate with business investors, manage
your business, or make important decisions. It's much more
effective to identify the risky areas of your plan, tell why
and how they impact the bottom line and what actions you
plan to take if they occur.
This helps you and your business
investors stay focused on the high impact areas and to think
clearly about whether other factors should be considered as
well. It also lends more credibility to your talents and
increases the likelihood of your plan's success.
Finish this discussion with a summary of the critical
aspects of your plan and related contingency plans. If
you've followed all these steps, then you can figure out
what you'll do if your actual performance turns out to be
different than your business plan financial projections.
Remember, you're purpose is to demonstrate to business investors
that you're competent; worrying about protecting their investment
and running a business, not just flying by the seat of your pants.
Article Source: http://EzineArticles.com/18505
Sunday, July 10, 2011
50 Surefire Business Card Tips
Business cards are one of the most powerful and inexpensive marketing tools you can use. Here are 50 surefire tips to make the most out of your business cards:
Article Source: http://EzineArticles.com/15204
- Your business card must communicate more than just your contact information. Make sure that your card includes a tag line that explains what you or your company do.
- Order them in large numbers. By ordering 1000 your cost per card will be significantly lower than if you ordered 500.
- Even if you can produce your business cards at home using an inkjet printer, have your business cards professionally made by a printing company. Your business card will be the first impression your prospects receive of your business, so let them convey the best possible one.
- Avoid using standard clip art as your business logo. A logo brings credibility and brand awareness, so before you invest in business cards have a logo professionally made for your business. Nowadays, there are online companies that can produce a professional logo for as little as $25, so there is no excuse for not having one made.
- Put up a website and use the URL in your business cards. If you don't have a website, people will notice the absence of a web address in your business card and, depending on the business you are in, it may make you lose credibility.
- Keep all the information in your business card current. If you changed address or phone number, don't scratch the old number and write down the new one by hand; get new business cards.
- Keep your business card simple. Don't use too many fonts or try to cram too much information in it. Try to use a pleasant layout and make sure that your main message (your tagline or your unique selling proposition) doesn't get lost.
- If you live in the US, limit your business card size to 3.5" x 2". Anything bigger will not fit in standard card holders and your card may end up in the trash. Business cards in Europe tend to be larger, but so are the wallets and card holders.
- Make sure that your business card reflects your image. If you are an artist or a graphic designer, it is OK to use trendy colors and fonts. If you are an investment banker, a sober layout and colors such as blue or gray work better.
- Your business card is an integral part of your brand or corporate identity strategy. It should follow the same graphics standards as the rest of your communications material (stationary, brochures, letterheads, etc.).
- Find a way to make your business cards stand out. I've seen business cards with one of its corners cut in an angle, or with an interesting texture, all of which makes your business card stand out of the crowd. The best one I've seen is from an interior designer, who used a hologram to show a room before and after a redesign.
- Make your business card easy to read: use high contrast between the background and the type. Light background with dark type works better.
- After your logo, your name should be the largest piece of information on your card.
- Make sure that all the information on your card is printed in a large enough typeface to be easily readable.
- Run your business card copy through a spell checker and double-check your contact information.
- Keep your business cards with you at all times. Keep a stack in your car, in your house, in your office, and in your wallet.
- Leave your business cards in billboards at supermarkets, schools, stores, libraries, etc.
- When giving away your card, give two or three at a time, so that your contacts can in turn distribute them to other people. This will not only help you distribute them faster, but will generate a beneficial "endorsing effect".
- Include a business card with all your correspondence. People may throw away the letter, but will usually keep the business card.
- Make your business card go the extra mile: use the back of the card to print more information: special offers, checklists, schedules, etc.
- Throw in a business card in every product you ship.
- Send a business card with any gift you send, instead of just a card with your name.
- Scan your card and use it as an attachment to emails.
- Use your business cards as name tags. Get a transparent plastic cover with a pin, and attach it to your lapel. Wearing it on your right side tends to make it more noticeable.
- Use your business card as a name tag on your briefcase. Make sure that your company logo and tagline are visible. This way, your business card will turn into a "conversation piece" during plane rides, which may help you meet interesting people and good business contacts.
- Use your business card as an ad: many publications offer "business card size" classified ads. If you design your business card properly, it can double up as an ad in those publications.
- Don't give your business card too quickly. It may be perceived as pushy. Try to establish a conversation with your prospect first. For example, ask them what do they do. That will usually prompt them to give you their card. That is the perfect moment to give them yours.
- Don't try to give your card in situations where many people are giving them to your prospect. Wait for a moment when you can capture your prospect's attention span.
- Another tactic you can try when your prospect is overwhelmed and can't pay you enough attention is to send your card by mail. Pretend you ran out of business cards and ask for theirs. Then, mail them your card and take the opportunity to drop a follow up note.
- If you have a mobile phone number or a direct phone number that is not listed in your business card, write it at the back of your card before handing it out, and tell your prospect that you are giving them your direct number. This will make your card more important, and less likely to be lost or thrown out.
- Another way of increasing the chances that your prospect will keep your card is by printing valuable information on the back, for example important phone numbers (local police, hospitals, etc), a calendar, or a football schedule.
- Offer to hand out cards of complementary (non-competitive) business people in exchange for them distributing yours. An example of non-competitive businesses is real estate brokers and mortgage brokers.
- If somebody gives you their business card, you should give them yours in return.
- Always give your business card face up.
- Take a cue from Far East business people, who hand out business cards with both hands. It helps give the impression that your business card is something very important.
- If you conduct business internationally, use the back of your card to print a translated version of your business card in your customers' language. Even if they have no problem reading English, it will be a classy touch and they will appreciate it.
- If you sell different product brands and want to put their logos on your business card, print them in only one color. Using each logo's brand colors could make your business card look chaotic and busy.
- Create a business card in magnet form. Magnets are widely used, to hold important papers on the refrigerator door at home and on file cabinets at work. They are always visible and always get read.
- When receiving somebody else's business card, don't put it away immediately. Instead, keep it in your hand for a while you talk to your prospect, or place it neatly over the table, and try to develop a conversation based on the information on the card.
- Use the back of the cards you receive to write down important facts about the persons who handed them to you. It will help you enormously when you follow up with them.
- If you are in a profession where relationship selling is important, it may be a good idea to include your picture in your business card (i.e. real estate brokers).
- Even if your business is a sole proprietorship, you can still use "account manager" as your title instead of "owner" or "president". If you do sales (and we all do) "account manager" is a perfectly appropriate title, and it will give the impression that you work for a larger company.
- Use logos of organizations that you or your business belong to in your business cards. They are an easy way to provide instant credibility to your business. For example, if you operate a repair shop you can display the logo of the National Institute for Automotive Service Excellence (ASE) or the Triple A (AAA). (Check with them first about the terms of use).
- If you participate in affiliate programs online, you can still use business cards to promote your affiliate links. Use the name of the affiliate company as the company name, use 'partner' or 'associate' as your title, and the URL of the directory or web page where you have placed your affiliate links as your web address. Just because affiliate programs are online doesn't mean that you can't use off-line marketing methods to promote them.
- If you need to give cards to different kinds of prospects (for example if you are a student looking for work), make business cards with just your name and contact information, and attach custom made self-adhesive labels at the back with information of interest to each specific prospect.
- Include an information email address (for example: info@yourdomain.com) that is set in autoresponder mode, that automatically triggers an email message with full information about your product, service or company. This will increase the effectiveness of your business card since you will give your prospect much more information that you can fit in a card.
- Take good care of your business cards. Keep them clean and crisp in a cardholder. Don't give away cards that are bent or damaged.
- Try to get a cardholder with two pockets. That way, you can use one for your business cards and the other one for the business cards you receive.
- Keep all the business cards you receive neatly organized in a rolodex. It will save you time and will provide you with a database of contacts with whom to build positive business relationships.
- Collect all the business cards you can find, even if you don't need them. Together, they will act as an "idea file" that will provide you with valuable tips that you can use to design your business cards.
Article Source: http://EzineArticles.com/15204
The Secrets of Starting Business Successfully
Starting Business Secrets will help you to start your own business successfully.
The American Dream is, and always will be, to come up with an idea, start a business and become rich from your own efforts. Based upon this motivation, thousands of businesses fail each year, due primarily to not being familiar with the basics involved in running a business.
This report will enlighten you, and give you a number of suggestions you can use to better guarantee your chances for success. This report is written with the warning that any and every business venture contains certain inherent risks, and any number of alternatives.
We do not espouse that any one way is the right way or that our suggestions are the only way. On the contrary, we advise that before investing any money in a business venture, you seek counselling and help from a qualified accountant and/or attorney.
Just about the first thing you should consider before deciding to start or purchase a business is the legal form you'll be operating under. There are basically four choices: sole proprietorship, partnership, limited partnership, and/or corporation.
Each has a number of advantages and disadvantages. We'll try to enumerate some of them for you.
As much as anything else, for many people starting a business is a form of ego-gratification, and they form a corporation for some sort of prestige gain - just to say, "I own a corporation."
With just a little bit of observation, you'll find that one of the major causes of business failures is due to the founder wasting start-up capital on frills, such as an impressive store- front office, expensive furnishings, and corporate legal costs.
One of the basic traits you must develop it you're going to be successful in business, is a tight hold on your expenditures. In fact, a good rule of thumb is that anything that does not make money for yo or protect your investment, should not be purchased at this time.
Very definitely, this applies to the expense of setting up your own corporation.
Unless you have a partnership and start your business as such, the only real advantage to forming a corporation would appear to be that a corporate structure will semi-protect the property you personally own.
As an example, you own a home and car. You form a corporation to protect these possessions from business losses. Yet, if you can be found guilty of misusing corporate funds, your business creditors can pierce the corporate shield and come after your possessions.
Basically, if you invest everything you have in your business, as most newcomers do, you don't usually need a corporation because you have nothing to protect. Your household possessions, personal belongings, generally your car, and even a portion of the equity in your home is protected by the homestead provision of the Federal Bankruptcy Act, and cannot be taken away from you.
As a sole proprietor or partner of a business you'll be paying taxes on your overall earnings, much the same as if you were holding down a salaried or hourly paid job. Whether you do or don't take out money as a salary will have no bearing on the earnings of your business and tax return.
The often advertised advantage of incorporating, that you can manipulate your salary in order to save on tax dollars, is real because of corporation laws. However, the IRS frowns on this practice. When your business is successful and making a lot of money, definitely check with your accountant on the advantages of incorporating.
As a corporation, you'll be subject to a number of other drawbacks as well: generally higher state taxes, stricter laws concerning the operation of your business, more elaborate accounting procedures, and legal papers that are required just about every time you make a major move or sign almost any contract.
Thus, your legal and accounting fees will be much higher as a corporation than will those required for a sole proprietorship type of business.
As a sole proprietor or partnership, you'll find many areas require the registration of your business name. The cost however, is minimal, ranging from $5 to $100.
About the best way to find out what laws apply in your area, is to call your bank and ask if they need a fictitious name registration card or certificate in order for you to open a business account.
Selecting a name for your business is quite important to you and particularly relative to advertising. Your business name should describe the product or services you offer. Fancy names such as, Linda's Clipping Service will lose potential "walk-in and passing" customers to the beauty shop across the street that calls itself, Patti's Beauty Salon or Jane's Hair Styling Shop.
The advantage of using your full name in the title of your business, such as Johnny Jones' Meat Lockers, has the advantage of making credit somewhat easier to come by - provided you pay your bills on time - but it also includes the disadvantage of confining your services to a local or at most, a regional area.
Should you buy, lease, or rent a space for your business? think twice before you make any decision along these lines. Most businesses tend to grow quickly or they never get off the ground.
There are a few exceptions, but only a very few, that tend to grow at a modified rate.
So, buying a piece of property and setting up your business on or within that property, obligates you to ownership regardless of what happens to your business.
Leases are almost always very strong contracts written by attorneys to the advantage of the property-owner. When you sign an agreement to pay someone for the use of their space over any length of time, you're "nailed in" to paying for that space regardless of what happens to your business.
In the beginning, it's wise to either get the shortest-term lease possible, or arrange to rent with an option to lease at a later date. This does not apply to a retail business, unless your particular business happens to be an untried one.
Definitely, you should open a business bank account. In selecting a bank for your business, scout around and look for one that can, and will help you. Determine what your banking needs will be, and then via telephone, interview the managers of the banks in your area. The important convenient bank to your business location.
A point to remember: the closer you can make the relationship between you and the bank manager, the better your chances are going to be for approval on loans and/or special favors you may need at a later date.
Try to become acquainted with as many of the bank employees as possible. The better you know them, the more courtesies they'll be extending especially to you in the course of your association.
Just as a doctor is a specialist in his field, and you go to him for medical problems, your banker is a specialist in his field and you should go to him for your money problems. In business, you'll have to learn that everyone is an expert in his own line of work, and in your associations with other business people, refrain from acting like a "sharpie" and/or pretending that you know exactly how everything works in someone else's specialty.
You'll find that very often, different banks specialize in different types of businesses. As an example, you're sure to find banks that specialize in real estate transactions, export- import businesses, and even manufacturing operations only.
What I'm saying here is that if you're planning to sella fairly expensive item, your customers will probably need and/or want financing. It will behoove you to select a bank familiar with your type of product that will afford your customers, through you, contract financing.
Some of the questions you should ask of your banker include the following:
Is it necessary to maintain a certain balance in your account before the bank will approve a loan for you? What qualifications must you have in order to obtain a line of credit with the bank?
Does the bank limit the number of loans, or types of loans it will approve for small businesses?
What is the bank's policy regarding the size of a check you might deposit that requires holding for collection?
And what about checks less than that amount - will they be immediately credited to your account?
In almost all types of businesses, it will be to your benefit to set up with your bank, a method of handling VISA, Master Charge, and regional credit cards. The important thing here is to ultimately set up your account in the bank that will service all of these credit transactions for you - one stop for all your banking needs.
In most instances, you'll find that having the capability to fill orders/make sales via credit card transactions, will increase your volume of sales appreciatively.
Once you've made the decision as to which bank is going to handle your account, you'll need your Social Security Number or your Federal Employer's Identification Number, your driver's license, the fictitious name certificate, and if you're requesting a VISA or Master Charge franchise, you'll also need a financial statement.
For corporations, you'll also need a corporate resolution approving of the opening of your business account.
There are different policies exercised in just about every state regarding installation/hook-up charges by the telephone and utility companies. Some require a deposit, and some don't.
You'll find that a great number of city business license departments are there solely for the purpose of collecting another tax. Depending on the type of business you're asking a license for, the building and zoning people may inspect your premises for soundness of structure and safety
Generally, you won't encounter any difficulties - you simply pay your fee to operate your business in that city, and the clerk types your name onto a city license certificate.
Relative to sales tax permits and licenses, each state's rules and regulations very widely. The best thing to do is call your state offices and ask for information concerning registry and collection procedures.
Many states require an advance deposit or bond, and you'll find that some wholesalers or manufacturers will not sell to you at wholesale prices until you can show them your sales tax permit or number.
Should your business entail selling your products or services across state lines, in another state, you're not required to collect taxes except in those where you have offices or stores.
You may find also that your particular business requires the collection of Federal Excise Taxes. For information along these lines, check in with your local office of the Internal Revenue Service.
Some states also require certain businesses to hold state licenses, such as those required in many states for TV Repairmen.
These are known as "occupational permits" and are most often required of barbers, hair stylists, real estate people and a number of other consumer oriented businesses. If you have any doubts, check with your state offices for a list of those occupations that require licensing.
Any business doing business in any type of interstate commerce is subject to federal regulations, usually through the Federal Trade Commission. This means that any business that shops, sells or advertises in more than one state is subject to such regulation, and this includes even the smallest of mail order operations.
Normally, very few business people ever have and contact with the federal regulatory agencies. The only exceptions being when there is a question of your operating your business unethically or illegally.
Any business that sells or distributes food in any manner almost always requires a county health department permit. If your business falls into this category, simply call the county health department and invite them out to your place of business for an inspection. The fees generally range from about $25, depending on the size of your business when they first inspect it for permit approval.
There are also a number of businesses that require inspection by a fire marshall, and fire department approval. Generally, these are those that handle flammable materials or attract large numbers of people, such as a theater. Overall, the local fire department has to be allowed to inspect your premises whenever they desire to do so.
You may also run into a requirement for an air and/or water pollution control permit. These specifically apply to any business that burns anything, discharges anything into the sewers or waterways, or use any gas-producing product, such as a paint sprayer.
Without a doubt, you'll need to check on local regulations relating to advertising display signs. Each city or township makes its own rules and then enforces those rules according to its own thinking -check before you contract to have a sign made for your business.
The design and placement of your sign is very important to your business - specifically to retail establishments - but let me remind you that your business sign is usually the first thing a potential customer sees and as such, it should catch his eye and leave an impression that lasts.
It would be a good idea to ride around your town and take a look at the signs that catch your eye, and try to determine the impression of the business that sign leaves on you. This is a basic learning formula for determining the design, size and placement of your business sign.
Some of the other things to consider before opening for business - If you intend to employ one or more employees, you'll be required to deduct Federal Income Taxes, and Social Security payments from their checks. This will involve your filing for a Federal Tax Number and necessitates contact with your local IRS Office.
Most states have "unemployment taxes" which will have to be deducted from the paychecks of any employees you hire. And there are a number of states that have income taxes - disability insurance - and any number of other taxes. Again, the best thing to do is check with your local office of the IRS. And above all else, don't forget to ask for the rules of the minimum wage law, and comply.
When your business grows to the point of needing additional help, don't be afraid to look for and hire the help you need. when you're ready to hire someone, simply run an ad in your local paper and/or register your needs with the local office of your state's employment service. Businesses either grow or die, and those that grow eventually need more people in order to continue growing.
When that time comes, hire the additional people you need, and your business will continue growing. If you don't, for whatever reason, you'll find yourself married to your business and your business growth stymied.
Regardless of how small your business is when you begin, never walk in with the thought in mind that it's something to keep you busy. Anyone with an attitude of that kind is a fool. You begin and make a business successful in order to realize financial freedom.
Establish your business. Put it on its feet, and then hire other people to do the work for you. And those businesses that require an operations manager, or someone to run a phase of the business you're too busy to handle, hire the person needed or the business will surely suffer.
To protect the investment of your business, you need business insurance. If you've never had any experience with business insurance, simply look under the heading of "business insurance" in your phone directory.
Ask for bids from several different companies or agents...Primarily, you should have a policy that gives you general liability, fire, workmen's compensation, business interruption, and vehicle coverage. You amy also want coverage against possible losses related to burglary, robbery, Life & Accident, Key Man, and Fidelity Bonds.
As the sole proprietor of a business, you won't be paid as an employee, so there will be no income tax deducted from whatever you withdraw from the company's earnings. What you'll have to do is a gain check with the IRS Office for a Tax Guide For Small Businesses Handbook, and probably end up filing an estimated tax return on a quarterly basis.
The minute you open your doors for business, you'll have to spend some time engaged in the work of bookkeeping. Exactly how, and using what forms, you keep books, should be on the recommendations of a good tax counselor...The same holds true for your overall business and/or payroll accounting system. Look for an experienced CPA that knows the accounting problems to your particular kind of business, and solicit his advise/counseling.
If your business is going to involve the possible purchase or lease of operating equipment, again seek the help of your tax counselor for the most advantageous method of obtaining the needed equipment.
Basically, arranging for your suppliers to give you materials on credit will depend upon your honesty and personal financial statement. The best way is usually a personal visit to the person with the power to approve or disapprove of credit at the company where you want to set up a credit account.
Show him your financial statement, and explain your prospects for success. Then assure him that you've always honored all of your obligations, and that if ever there's a question or problem, you'd like for him to call you at home. And of course, give him your home phone number.
We won't go into the exigencies of advertising your products, services or business here, but there is something along these lines you should always keep in mind. The best kind of advertising your business can receive is that you don't really pay for - publicity.
When something unusual happens to you, your business, or your employees - that's news, so be sure to tell the news media in your area about it.
Article Source: http://EzineArticles.com/4240
The American Dream is, and always will be, to come up with an idea, start a business and become rich from your own efforts. Based upon this motivation, thousands of businesses fail each year, due primarily to not being familiar with the basics involved in running a business.
This report will enlighten you, and give you a number of suggestions you can use to better guarantee your chances for success. This report is written with the warning that any and every business venture contains certain inherent risks, and any number of alternatives.
We do not espouse that any one way is the right way or that our suggestions are the only way. On the contrary, we advise that before investing any money in a business venture, you seek counselling and help from a qualified accountant and/or attorney.
Just about the first thing you should consider before deciding to start or purchase a business is the legal form you'll be operating under. There are basically four choices: sole proprietorship, partnership, limited partnership, and/or corporation.
Each has a number of advantages and disadvantages. We'll try to enumerate some of them for you.
As much as anything else, for many people starting a business is a form of ego-gratification, and they form a corporation for some sort of prestige gain - just to say, "I own a corporation."
With just a little bit of observation, you'll find that one of the major causes of business failures is due to the founder wasting start-up capital on frills, such as an impressive store- front office, expensive furnishings, and corporate legal costs.
One of the basic traits you must develop it you're going to be successful in business, is a tight hold on your expenditures. In fact, a good rule of thumb is that anything that does not make money for yo or protect your investment, should not be purchased at this time.
Very definitely, this applies to the expense of setting up your own corporation.
Unless you have a partnership and start your business as such, the only real advantage to forming a corporation would appear to be that a corporate structure will semi-protect the property you personally own.
As an example, you own a home and car. You form a corporation to protect these possessions from business losses. Yet, if you can be found guilty of misusing corporate funds, your business creditors can pierce the corporate shield and come after your possessions.
Basically, if you invest everything you have in your business, as most newcomers do, you don't usually need a corporation because you have nothing to protect. Your household possessions, personal belongings, generally your car, and even a portion of the equity in your home is protected by the homestead provision of the Federal Bankruptcy Act, and cannot be taken away from you.
As a sole proprietor or partner of a business you'll be paying taxes on your overall earnings, much the same as if you were holding down a salaried or hourly paid job. Whether you do or don't take out money as a salary will have no bearing on the earnings of your business and tax return.
The often advertised advantage of incorporating, that you can manipulate your salary in order to save on tax dollars, is real because of corporation laws. However, the IRS frowns on this practice. When your business is successful and making a lot of money, definitely check with your accountant on the advantages of incorporating.
As a corporation, you'll be subject to a number of other drawbacks as well: generally higher state taxes, stricter laws concerning the operation of your business, more elaborate accounting procedures, and legal papers that are required just about every time you make a major move or sign almost any contract.
Thus, your legal and accounting fees will be much higher as a corporation than will those required for a sole proprietorship type of business.
As a sole proprietor or partnership, you'll find many areas require the registration of your business name. The cost however, is minimal, ranging from $5 to $100.
About the best way to find out what laws apply in your area, is to call your bank and ask if they need a fictitious name registration card or certificate in order for you to open a business account.
Selecting a name for your business is quite important to you and particularly relative to advertising. Your business name should describe the product or services you offer. Fancy names such as, Linda's Clipping Service will lose potential "walk-in and passing" customers to the beauty shop across the street that calls itself, Patti's Beauty Salon or Jane's Hair Styling Shop.
The advantage of using your full name in the title of your business, such as Johnny Jones' Meat Lockers, has the advantage of making credit somewhat easier to come by - provided you pay your bills on time - but it also includes the disadvantage of confining your services to a local or at most, a regional area.
Should you buy, lease, or rent a space for your business? think twice before you make any decision along these lines. Most businesses tend to grow quickly or they never get off the ground.
There are a few exceptions, but only a very few, that tend to grow at a modified rate.
So, buying a piece of property and setting up your business on or within that property, obligates you to ownership regardless of what happens to your business.
Leases are almost always very strong contracts written by attorneys to the advantage of the property-owner. When you sign an agreement to pay someone for the use of their space over any length of time, you're "nailed in" to paying for that space regardless of what happens to your business.
In the beginning, it's wise to either get the shortest-term lease possible, or arrange to rent with an option to lease at a later date. This does not apply to a retail business, unless your particular business happens to be an untried one.
Definitely, you should open a business bank account. In selecting a bank for your business, scout around and look for one that can, and will help you. Determine what your banking needs will be, and then via telephone, interview the managers of the banks in your area. The important convenient bank to your business location.
A point to remember: the closer you can make the relationship between you and the bank manager, the better your chances are going to be for approval on loans and/or special favors you may need at a later date.
Try to become acquainted with as many of the bank employees as possible. The better you know them, the more courtesies they'll be extending especially to you in the course of your association.
Just as a doctor is a specialist in his field, and you go to him for medical problems, your banker is a specialist in his field and you should go to him for your money problems. In business, you'll have to learn that everyone is an expert in his own line of work, and in your associations with other business people, refrain from acting like a "sharpie" and/or pretending that you know exactly how everything works in someone else's specialty.
You'll find that very often, different banks specialize in different types of businesses. As an example, you're sure to find banks that specialize in real estate transactions, export- import businesses, and even manufacturing operations only.
What I'm saying here is that if you're planning to sella fairly expensive item, your customers will probably need and/or want financing. It will behoove you to select a bank familiar with your type of product that will afford your customers, through you, contract financing.
Some of the questions you should ask of your banker include the following:
Is it necessary to maintain a certain balance in your account before the bank will approve a loan for you? What qualifications must you have in order to obtain a line of credit with the bank?
Does the bank limit the number of loans, or types of loans it will approve for small businesses?
What is the bank's policy regarding the size of a check you might deposit that requires holding for collection?
And what about checks less than that amount - will they be immediately credited to your account?
In almost all types of businesses, it will be to your benefit to set up with your bank, a method of handling VISA, Master Charge, and regional credit cards. The important thing here is to ultimately set up your account in the bank that will service all of these credit transactions for you - one stop for all your banking needs.
In most instances, you'll find that having the capability to fill orders/make sales via credit card transactions, will increase your volume of sales appreciatively.
Once you've made the decision as to which bank is going to handle your account, you'll need your Social Security Number or your Federal Employer's Identification Number, your driver's license, the fictitious name certificate, and if you're requesting a VISA or Master Charge franchise, you'll also need a financial statement.
For corporations, you'll also need a corporate resolution approving of the opening of your business account.
There are different policies exercised in just about every state regarding installation/hook-up charges by the telephone and utility companies. Some require a deposit, and some don't.
You'll find that a great number of city business license departments are there solely for the purpose of collecting another tax. Depending on the type of business you're asking a license for, the building and zoning people may inspect your premises for soundness of structure and safety
Generally, you won't encounter any difficulties - you simply pay your fee to operate your business in that city, and the clerk types your name onto a city license certificate.
Relative to sales tax permits and licenses, each state's rules and regulations very widely. The best thing to do is call your state offices and ask for information concerning registry and collection procedures.
Many states require an advance deposit or bond, and you'll find that some wholesalers or manufacturers will not sell to you at wholesale prices until you can show them your sales tax permit or number.
Should your business entail selling your products or services across state lines, in another state, you're not required to collect taxes except in those where you have offices or stores.
You may find also that your particular business requires the collection of Federal Excise Taxes. For information along these lines, check in with your local office of the Internal Revenue Service.
Some states also require certain businesses to hold state licenses, such as those required in many states for TV Repairmen.
These are known as "occupational permits" and are most often required of barbers, hair stylists, real estate people and a number of other consumer oriented businesses. If you have any doubts, check with your state offices for a list of those occupations that require licensing.
Any business doing business in any type of interstate commerce is subject to federal regulations, usually through the Federal Trade Commission. This means that any business that shops, sells or advertises in more than one state is subject to such regulation, and this includes even the smallest of mail order operations.
Normally, very few business people ever have and contact with the federal regulatory agencies. The only exceptions being when there is a question of your operating your business unethically or illegally.
Any business that sells or distributes food in any manner almost always requires a county health department permit. If your business falls into this category, simply call the county health department and invite them out to your place of business for an inspection. The fees generally range from about $25, depending on the size of your business when they first inspect it for permit approval.
There are also a number of businesses that require inspection by a fire marshall, and fire department approval. Generally, these are those that handle flammable materials or attract large numbers of people, such as a theater. Overall, the local fire department has to be allowed to inspect your premises whenever they desire to do so.
You may also run into a requirement for an air and/or water pollution control permit. These specifically apply to any business that burns anything, discharges anything into the sewers or waterways, or use any gas-producing product, such as a paint sprayer.
Without a doubt, you'll need to check on local regulations relating to advertising display signs. Each city or township makes its own rules and then enforces those rules according to its own thinking -check before you contract to have a sign made for your business.
The design and placement of your sign is very important to your business - specifically to retail establishments - but let me remind you that your business sign is usually the first thing a potential customer sees and as such, it should catch his eye and leave an impression that lasts.
It would be a good idea to ride around your town and take a look at the signs that catch your eye, and try to determine the impression of the business that sign leaves on you. This is a basic learning formula for determining the design, size and placement of your business sign.
Some of the other things to consider before opening for business - If you intend to employ one or more employees, you'll be required to deduct Federal Income Taxes, and Social Security payments from their checks. This will involve your filing for a Federal Tax Number and necessitates contact with your local IRS Office.
Most states have "unemployment taxes" which will have to be deducted from the paychecks of any employees you hire. And there are a number of states that have income taxes - disability insurance - and any number of other taxes. Again, the best thing to do is check with your local office of the IRS. And above all else, don't forget to ask for the rules of the minimum wage law, and comply.
When your business grows to the point of needing additional help, don't be afraid to look for and hire the help you need. when you're ready to hire someone, simply run an ad in your local paper and/or register your needs with the local office of your state's employment service. Businesses either grow or die, and those that grow eventually need more people in order to continue growing.
When that time comes, hire the additional people you need, and your business will continue growing. If you don't, for whatever reason, you'll find yourself married to your business and your business growth stymied.
Regardless of how small your business is when you begin, never walk in with the thought in mind that it's something to keep you busy. Anyone with an attitude of that kind is a fool. You begin and make a business successful in order to realize financial freedom.
Establish your business. Put it on its feet, and then hire other people to do the work for you. And those businesses that require an operations manager, or someone to run a phase of the business you're too busy to handle, hire the person needed or the business will surely suffer.
To protect the investment of your business, you need business insurance. If you've never had any experience with business insurance, simply look under the heading of "business insurance" in your phone directory.
Ask for bids from several different companies or agents...Primarily, you should have a policy that gives you general liability, fire, workmen's compensation, business interruption, and vehicle coverage. You amy also want coverage against possible losses related to burglary, robbery, Life & Accident, Key Man, and Fidelity Bonds.
As the sole proprietor of a business, you won't be paid as an employee, so there will be no income tax deducted from whatever you withdraw from the company's earnings. What you'll have to do is a gain check with the IRS Office for a Tax Guide For Small Businesses Handbook, and probably end up filing an estimated tax return on a quarterly basis.
The minute you open your doors for business, you'll have to spend some time engaged in the work of bookkeeping. Exactly how, and using what forms, you keep books, should be on the recommendations of a good tax counselor...The same holds true for your overall business and/or payroll accounting system. Look for an experienced CPA that knows the accounting problems to your particular kind of business, and solicit his advise/counseling.
If your business is going to involve the possible purchase or lease of operating equipment, again seek the help of your tax counselor for the most advantageous method of obtaining the needed equipment.
Basically, arranging for your suppliers to give you materials on credit will depend upon your honesty and personal financial statement. The best way is usually a personal visit to the person with the power to approve or disapprove of credit at the company where you want to set up a credit account.
Show him your financial statement, and explain your prospects for success. Then assure him that you've always honored all of your obligations, and that if ever there's a question or problem, you'd like for him to call you at home. And of course, give him your home phone number.
We won't go into the exigencies of advertising your products, services or business here, but there is something along these lines you should always keep in mind. The best kind of advertising your business can receive is that you don't really pay for - publicity.
When something unusual happens to you, your business, or your employees - that's news, so be sure to tell the news media in your area about it.
Article Source: http://EzineArticles.com/4240
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