Small Business Owners Sat, 14 Jun 2014 05:05:35 +0000 en-US hourly 1 Top 10 Small Business Marketing Techniques /top-10-small-business-marketing-techniques/ /top-10-small-business-marketing-techniques/#comments Sat, 14 Jun 2014 05:05:35 +0000 http://www./?p=1142 Marketing your small business is essential to its short and long-term success. By engaging in marketing efforts from the minute you set up shop, you build up a reputation for your business and increase public awareness of what you have to offer. A sustained marketing effort keeps your business on the radar of current customers and exposes you to new potential customers.

According to Small Business Administration research, most small business owners say they wish they had invested more into marketing when they started their businesses. A good marketing effort can help start-up businesses gain customers quickly, allowing the business to get off to a good start on sound financial footing.

Marketing is more than just buying a few TV or print ads or hiring a guy in a gorilla suit to stand outside your location. Marketing is the evolution of a brand and image for you business, and should not be undertaken in a haphazard, fly-by-night manner.

The following are a list of proven marketing strategies that work for small businesses, particularly recent start-ups.

1. Send a press release to your local newspaper or media outlet. Many newspapers and other outlets have a section in their print edition or website for community happenings. By sending information about your business to these outlets, you may be able to take advantage of a little free advertising to get the word out about your business. Also, if your press release has a unique angle or concerns a special event, you may get a news story out of it, increasing your business’ public exposure at a minimal cost.

It may also be beneficial to send out a few press releases each year and cultivate relationships with local media, as they will be more likely to help their friends with coverage.

2. Have business cards printed. It may seem a little 20th century, but the business card has been around more than a century for a very good reason. It provides potential clients with a portable and quick to access point of contact for your business. Once you get some business cards printed out, distribute them around town in public spaces like diners and gas stations, and carry a few around to distribute yourself to potential clients.

3. Build a database. When possible, try to get client contact information so you can get in touch with them about sales or new products. By keeping detailed contact information, such as individual customers’ favorite purchases, you can make more targeted promotions.

4. Build a brand. When starting your business, have a definite brand image in mind for your enterprise. Have a logo for your business, and have it printed on a variety of media, such as business cards, t-shirts, mugs, etc. By building a likeable brand, you can build consumer loyalty  and build a sense of community around your business. The more you can get your customers to identify with your business, the more likely they will be to support it for the long term.

5. Opening event. Don’t just open shop one day. Stage a grand opening to make a first impression with the community that you are serving. Grand openings for home-based or online businesses may be impractical, however. Instead try offering opening discounts or other incentives to get your name out and score some inital customers.

6. Keep track of your marketing efforts. Track how foot traffic or web traffic to your business, sales and other metrics go up or down after a marketing effort. From this data you can see what marketing efforts are working, and the ones that you may need to re-tool or abandon. Marketing dollars are precious, so making the best use of each one is key to your success.

7. Don’t spend it all in one place. The key to a successful marketing strategy is duration. If you spend all of your marketing budget on just one or two promotions, these events or deals will eventually subside from the public consciousness, leaving you with minimal benefit. Dole out your marketing budget carefully throughout the year, sponsoring several promotions in order to stay current with the public.

8. Let’s make a deal. One easy way to market is by offering promotional deals or discounts. If you’re new to a business, this is a great way to get the public in your store and if you’re an established business, it’s a great way to get them to come back. Even if you’re an online or home-based business, offering the occasional price break is an excellent way to make sure your existing customers stay loyal, and to attract a little new blood to your revenue stream.

9. Guerilla marketing – Unconventional marketing that gets the most bang for the advertising dollar has become the new wunderkind of marketing in the current economic environment. Publicity stunts, direct contact marketing and other techniques have proven to be very effective for smal niche businesses. Guerilla marketing relies on creativity and improvisation, so it doesn’t hurt to be a little unconventional with your marketing approaches when trying this tactic.

10. Get in good with public safety. By offering discounts to cops and firefighters, you gain a valuable customer base, and one that can keep your business safe. It also helps to reach out to civic organizations, giving them donations when you are able. By becoming affiliated with these groups, you gain loyal customers.

By using these 10 marketing tips, small businesses and new small businesses can grow their brand and make the most out of their marketing dollars. As your business grows and prospers, you’ll likely be able to increase the scope and your dollar investment in marketing your business, moving into areas such as television, radio and print advertising, social media marketing, search engine optimization anThe importance of good marketing in a competitive economy cannot be understated, as you can go broke having the best products and services in the world if no one knows about them.

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Small Business Employee Tax Issues /small-business-employee-tax-issues/ /small-business-employee-tax-issues/#comments Sun, 18 May 2014 23:31:46 +0000 http://www./?p=1433 Hiring employees creates a number of tax issues for small business owners. Staying on top of the tax withholding and reporting requirements for businesses is key to avoiding potentially expensive problems with the IRS and state revenue agencies.

Perhaps the most significant tax issue small business owners face with regard to employees and taxes are the withholdings they are required to make from employee paychecks. Employers are required to withhold federal income taxes from their employees’ paychecks and pay these withholdings directly to the Internal Revenue Service.

The amount to withhold varies from employee to employee, with variables such as the employee’s salary amount, the number of exemptions claimed by employees and their marital status influencing the amount. To help employers calculate how much to withhold, employees are required to fill out W-4 forms to determine how much should be taken out of their checks for federal income taxes.

In addition to income taxes, employers are also required to withhold employee pay for Social Security and Medicare taxes. These taxes are a little easier to calculate, as they are levied at a flat rate of 6.2 percent for Social Security and 1.45 percent for Medicare. (The SS withholding rate was reduced to 4.2 percent for 2011 and extended by two months into 2012. Employers should keep a watch on the actions of the federal government to see what the rate will be moving forward into 2012.)

If you live in a state with an income tax, you will also be required to withhold state income taxes from your employees paychecks. Income tax rates vary from state to state, and your state’s department of revenue is the best place to find more information about how much tax you need to withhold.

In addition to the taxes you withhold from your employees’ checks, you’re also required to make an employer’s contribution to Social Security and Medicare. The employer’s contribution is currently at 6.2 percent for Medicare and 1.45 percent for Medicare. Businesses must also pay state and federal unemployment taxes. State rates vary, but the federal unemployment tax rate is 6.2 percent of the employees’ income. However, employers who pay their state and federal unemployment taxes on time can take a tax credit of up to 5.4 percent of employee pay, making their effective federal unemployment tax rate .8 percent.

Businesses that employ a large number of workers are required to deposit their FICA taxes by using the Electronic Federal Tax Payment System, an online transfer system. This greatly reduces hassles and paperwork for both you and the federal government.

Small businesses that provide health benefits for their employees should be aware of tax deductions they can take. Beginning in 2010, small businesses were permitted to take a tax credit of 35 percent of the premiums they paid to cover employees. The credit is available to businesses that employ 25 workers or fewer where the average wage is $50,000 or less (Deduction rates are smaller for companies with average annual wages of less than 25 percent). Also, to qualify for the credit, employers must pay at least half the premium for their employees’ coverage.

Employee tax cheatsheat

Here’s a quick rundown of the things you must do to comply with most state and federal tax law if you’re operating a business with employees:

- Once you hire employees, you’ll need to report your new hires to your state’s employment office within 20 days of your employees’ start date.

- Make sure your employees are citizens or foreign nationals approved to work in the U.S. by filling out U.S. Citizenship and Immigration Services Form I-9. You can find a copy of this report on the U.S. Citizenship and Immigration Services website.

- Withhold appropriate income and FICA taxes from your employees’ paychecks and submit the taxes to the IRS. IRS Publication 15 can show you how to submit withholdings and is available on the IRS website.

- Withhold state income taxes and deposit them with your state revenue agency.

- Pay the employer’s share of Social Security and Medicare taxes. Employers pay the same share as employees, currently 7.65 percent of wages up to $106,800 and 1.45 percent of wages above that amount.

- Pay unemployment taxes to the IRS. Employers must pay unemployment taxes if they paid more than $1,500 in wages in a calendar year. Also, don’t forget to pay your state unemployment taxes.

- Make sure that you report your employees wages and your withholdings to the Internal Revenue Service by using IRS form W-2.

By making sure that you comply with government regulations regarding employee tax withholdings and other employee tax issues, you can save yourself considerable headaches and your business money in the form of non-compliance penalties.

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Hiring A Web Developer For Your Small Business /hiring-web-developer-small-business/ /hiring-web-developer-small-business/#comments Thu, 08 May 2014 01:47:26 +0000 http://www./?p=1437 Your business’ web page is the online storefront for your business. It’s often the first impression people get of your business  – in fact, it may often be the only contact customers have with your business.

Because of the high visibility of your site, and the importance that first impressions make, it is important to have a site that is well-designed in terms of aesthetics as well as functionality. Online sales are a huge part of retail revenue – just last year, online retail sales reached $177 billion. And because of the level playing field online selling can give small business to compete with larger competitors, having a top notch web site for your business is a must.

While many business owners can easily design attractive and reliable web pages on their own, less tech savvy owners may want to turn to a professional web developer to help build their Internet pages. Web developers are professionals who develop software specifically for Internet applications and webpages. They can provide you with the technical expertise neccessary to take the concepts you have for your website and bring them online.

A good web developer will be able to create an attractive, functional site for your small business. He or she will be able to use the resources you make available to him to make your site perform to the limits of those resources. The web developer you want will be able to take input from you and put it into action onscreen, and will also be able to advise you about ideas you may have that are impractical or unfeasible.

A qualified web developer will need to be skilled in hand-coding HTML and should also be able to work in CSS. Your web developer should also be familiar with JavaScript, XML, CGI scripting, and should also be able to work with a variety of servers.

When advertising for a web developer, you’ll need to determine whether you’ll need a full time employee or someone who can work on a contractual or part-time basis. For many small business start-ups, all that is needed is for the web developer to do the initial work in getting the site up off the ground and instructing the owner how to do basic maintenance. However, it is recommended that you keep the web developer’s contact information handy in case technical support or advice is needed.

Web developers can be found online using Elance or Craigslist, or you may want to turn to some fellow business owners you know and trust to help you find a reliable web developer.

When hiring a web developer, you’ll want to ask specifically about their technical skills. Ask for a detailed resume, including their education and previous employers. Ask to see what web sites they’ve helped design and check the references they’ve provided to get an idea of the quality of work they’re able to produce.

When talking to potential hires, outline what you want done with your site, and ask the interviewee direct questions about how he or she would accomplish your goals. This gives you the opportunity to assess the developer’s technical skills, as well as the developer’s skills in communicating with his or her potential employer. Technical skills are important, but the ability to understand and adapt to an employer’s requests are also key skills that your web developer must have.

When hiring a web developer you’ll want an individual or team who can design the information architecture – that is, how information is organized – on your site. It’s also important to choose a developer with graphic design skills who can pick attractive graphics, colors and fonts for your site. Programming skills are, of course, a must as well and the developer or developers you hire should also have the neccessary skills to test and launch the new site.

Be upfront about the technology and resources you’re able to provide the web developer and ask about the web developer’s own equipment and resources. And before making a final agreement, be sure to outline exactly what you want from the web developer and also work with him or her to come up with a series of milestones and a completion date. The dates don’t have to be set in stone, but having regular progress markers is important to getting the job done in a timely manner.

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How To Transfer Your Small Business To A Partner /transfer-small-business-partner/ /transfer-small-business-partner/#comments Mon, 28 Apr 2014 02:47:21 +0000 http://www./?p=1189 Change is inevitable in business. In time, you may decide that it’s time to pass your business on to another owner, as health, personal concerns or a desire to start another business may have you looking for an exit strategy. To get the most out of your business, and to keep the legacy you’ve built from being eroded, it’s important to act smartly when transferring your business to another owner.

Transferring your business to a partner is a great way to ensure that the reputation and values of your business remain intact. By transferring the business to a partner you’ve worked with, you have the chance to hand off the reins to someone you can rely upon to continue the business in the way you’ve conducted it. Executing the transfer correctly is important to ensure that you get a good value for your interest in the business, and your partner’s interests are protected when you cash out of the business.

The first thing to consider when you’re deciding whether to sell your interest in the business is if that’s the option you really want to take. Once you sell the business, even if you’re able to still work there in some capacity, you won’t have nearly the influence on decisions that you did when you held an ownership stake. Also, if you announce you’re selling the business to a partner and then change your mind, you risk alienating the partner and causing turmoil for your business and your employees. If you’re just feeling somewhat fatigued by running the business, you may want to take a brief sabbatical before announcing your intent to transfer the business to your partner.

If you’re sure that this is the course you want to take, you should first approach your partner and inform him or her of your plans. You’ll need to talk finance, because your partner’s financial health plays a big factor in whether you’ll be able to execute the transfer, as some partners may not be able to afford to buy out your stake. You’ll need to discuss financing for the buy out and a timeline for your departure.

Next, you’ll need to have the business valued. A business valuation takes into account the current and future earnings of the business. You could do the valuation yourself using your records, but it may be advisable to have a financial professional do the valuation, to prevent possible disputes between you and your partner. A business valuator can also help you navigate the tax implications of selling the business. Once the business has been valued, you can calculate the value of your share of the business and begin negotiations with your partner over price.

Chances are that your partner will have to secure some type of financing to purchase your share of the business. How you structure this deal depends on your needs and the wishes of your partner. You may choose to allow your partner to make an upfront payment and then pay you a portion of the business’ profits over a period of time to purchase your interest. You may choose to go the route of a traditional bank loan, with your partner borrowing the amount necessary to purchase the business and paying you all at one time. It’s up to you and your partner to work out a plan that works out best for you both. Having a financial professional or attorney on hand to answer questions and set terms can be extremely helpful.

Once you’ve got the terms of the deal settled, you’ll need to firm up the timeline for your departure and transfer of ownership. This includes giving your partner full access to any company assets, files, property, etc. he or she may not have had access to before. You’ll also need to provide training on any aspects of the business that you’ve handled exclusively on your own up to this point. As the date of your departure draws closer, you’ll need to settle all unfinished business requiring your attention to ensure a smooth handover.

Also, once the time of your departure is settled, you’ll need to inform your employees of the upcoming change to allow them to begin to adapt to the transition. Springing a big change such as this on employees unexpectedly can cause morale problems and disruptions in the operation of your business.

After the business is transferred, you may want to work out a deal with your partner to be retained as a consultant to help insure the post-transition period runs smoothly and to answer questions your partner may have once he or she assumes full control of the business.

A well-planned and well-executed transfer can help you reap the financial benefit of your years of hard work and also ensure that your business legacy remains in trusted hands.

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Finding a Web Host For Your Small Business /finding-web-host-small-business/ /finding-web-host-small-business/#comments Fri, 18 Apr 2014 03:29:10 +0000 http://www./?p=1430 Finding a web host for your small business is the digital equivalent of finding a landlord for your shop. You need to find one that offers an affordable price and a reliable and well-maintained infrastructure.

A web host is essentially the company or organization that owns and maintains servers, high-performance computers that stay connected to the Internet at all times and keeping the web sites they hold up and operational. When your business uploads its website files to the web host’s servers and the host gets your site’s domain name properly configured, your site will go live and be available to online visitors.

Web hosts have varying rates and typically charge either a monthly or yearly rate. The rate is often based on the amount of data your site needs the webhost’s servers to store or how much data is transferred in and out of your site per month. The fancier your site is and the more traffic it gets, the more expensive it will likely be to host the site.

According to recent research, the cost of web hosting typically runs from $10 per month to thousands of dollars per year. Most small businesses pay between $180 and $600 per year for a simple web site. Small business owners who have extensive online databases or a large volume of online sales may pay $250 per month for web hosting.

There are free web hosts out there, but most of them place advertising on your site to offset the revenues they aren’t receiving from you. If you’re okay with other sites advertising on your site, and don’t have a big budget for web hosting, this may be an accepatable option for you.

When looking for a web host for your small business it is important to find one that is reliable. If your host’s servers frequently crash, people will not be able to visit your website. For small businesses that rely on online sales, having a buggy website can be fatal to their business. When picking a web host, you should shoot for a host with a minimum uptime of 99 percent or better.

Another key consideration when choosing a web host is whether the host has enough data storage space for your needs. If your site needs to grow in the future, your data needs may outgrow your host’s capacity. Changing web hosts can be extremely inconvenient. Before choosing a web host, determine if they have the capacity to handle your future needs as your online presence grows. You’ll also need to make sure the site does not have restrictive file size uploads, as some hosts have limits on the size of the files you upload or restrictions on the type of files you may upload, allowing you to only upload simple HTML and GIF or JPG files. Make sure your host offers you the flexibility you need with regard to file size and type.

Bandwidth allotment is also important, particularly if your site is going to have a lot of traffic. You’ll likely need about 1 to 3 GB per month in bandwith if you’re making sales online.

You’ll also want to choose a web host that is compatible with a variety of web design programs, as your business may have needs that require the use of specific design programs. A good web host should allow you to use FTP, PHP, Perl, SSI, .htaccess, telnet, SSH, MySQL, and crontabs.

If you’re going to be taking payments online, it’s important that your web host allows SSL. SSL is a cryptographic protocol that allows for the secure transmission of data such as credit card information via the Internet.

Your web host should have a user-friendly system that allows you to easily and conveniently make changes to your website. The process should also be quick, as you m

Lastly, a good web host should have an excellent technical support staff. You should be able to contact them 24/7 and they should be able to quickly address and resolve any problems that you may have.

When looking for all these important attributes, your best resource is perhaps other business owners. Ask them who they use for their web hosting needs, what service plans their host offers and how reliable the service is. Also visit their sites to see how they look. If you like what you see, chances are that you have a winner.

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Top 7 Small Business Blogs /top-7-small-business-blogs/ /top-7-small-business-blogs/#comments Tue, 08 Apr 2014 02:08:56 +0000 http://www./?p=1427 If you’re just starting out with a small business of your own, chances are that a little advice from seasoned small business entrepreneurs can help. Whether it’s learning how to balance your books, hire the right employees, meet your tax obligations or provide good customer service, getting advice from folks who’ve already blazed the trail can reduce your learning curve.

The great thing about the Internet is that advice on just about any subject is just a few clicks away. The downside is that not all of this advice is great advice. To help small business entrepreneurs find reliable online sources of encouragement, advice and caution, we’ve combed respected business publications to provide you with links to some of the best blogs about small business on the Internet.

1. Small Business Trends ( ) This blog was started by a former Bell & Howell executive and gives readers a look at a variety of worldwide issues and trends that impact small businesses. The blog connects readers to expert articles, news, interviews and books summaries to give readers a good idea of the major trends in small business entrepreneurship.

The wide range of articles is helpful because it can provide business owners in specific niches with advice about their particular business and the issues it faces.

2. Duct Tape Marketing ( ) If you’re a small business operating with a shoestring marketing budget, this helpful site offers expert advice on low-cost, high-impact small business marketing. The site offers advice from some of the big names in marketing, such as Dan Jana, Martin Jelsema, and Jill Konrath.

Some helpful tips gleaned from the site for inexpensive marketing include purchasing public radio sponsorships and creating interest in your direct mail offerings by differentiating them from the standard bulk rate mail with different coloring or asymmetric packaging shapes.

If you’re just starting out in marketing, the site can help you pick a small business field to go into by teaching you to analyze data to create businesses that cater to specific niche markets, such as extended family vacations.

3.   (

For a wide variety of sources, All Business Blog Center is a great site. At All Business Blog Center you can find expert commentary on management, sales, the legal aspects of small business, online entrepreneurship, marketing and more. All Business Blog Center’s strength is its organization, as the site has a list of browsable categories that can help you quickly get to the information you’re looking for. The site also provides some great business letter templates you can use.

Most of the posts on All Business Blog Center are related to beginning businesses, so the site’s usefulness to established businesses may be limited.

4. Small Business SEM ( This site largely focuses on how small businesses can use the Internet to their advantage. Run by an Internet marketing consultant, this site provides advice on search engine optimization, using social media and other online marketing topics. The site is one of the most popular small business blogs on the Internet and updates frequently, so it’s definitely worth looking at if you’re trying to increase traffic to your website or use Facebook and Twitter effectively.

5. Dane Carlson’s Business Opportunities Weblog – ( For entrepreneurs looking for the right niche before jumping into a small business, this is a must-see site. Updated frequently, Carlson’s blog points out a variety of great small business opportunities for entrepreneurs. Since 2001, the blog has listed more than 20,000 small business ideas and opportunities. A recent entry profiled a small business that expanded to offering a holiday decoration take-down service.

6. Noobpreneurer ( – Another great site for new small business owners, this site features articles on small business ideas, low-cost start-ups, online marketing and other items of interest to folks new to owning their own business. The site is a good mix of business theory, as well as practical how-to guides for how to improve your business.

7. ( One of the more popular small business blogs on the Web, is run by a woman who became a millionaire by the age of 26. The site offers some practical commentary and advice on small business and trends impacting the business world. Skewed toward younger entrepreneurs, the site offers articles aimed at that demographic group.

By checking out these and other business blogs, you can take a lot of the trial and error out of starting your own business by benefiting from the experience of others. The blogosphere frequently changes, and blogs come and go as their writers try new ventures or become established authorities in a subject, so frequently be on the look out for valuable new business blogs you can use to pick the brains of superstars in your industry.

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Financing Small Business Capital Needs /financing-small-business-capital/ /financing-small-business-capital/#comments Fri, 28 Mar 2014 06:52:38 +0000 http://www./?p=1414 If you own a small business and need financing for capital needs such as a building, vehicles or other heavy equipment, there are a number of options you can turn to in order to obtain funding.

Purchasing new facilities or large equipment is a big step for new and existing small businesses. Each move requires an act of faith on the part of the business owner predicated on the belief that the business will prosper. Making sure that belief becomes a reality could depend on how you fund the purchase.

Here’s a few ways to secure funding for capital projects:

Collateral loans: If your business already owns property, you can put this property up as collateral to secure a loan for your new capital needs. You can also put up other assets as collateral for a loan. For example, if you have a pretty large amount of account receivables, you may be able to put these up as collateral for a loan. If a bank is unwilling to make a loan, you can turn to an asset-based lender, although these lenders are likely to charge higher interest rates.

Refinancing existing loans: If you have a significant amount of equity in your current property, you may be able to refinance your loans to borrow additional money for a new facility. There’s a risk involved, as adverse circumstances that make you unable to pay the loan could put you in risk of losing your current property, but with good management, your equity in your current location can provide an excellent avenue to pursue for financing for new facilities or equipment.

SBA loans: Loans backed by the Small Business Administration can be extremely helpful. Businesses who can obtain SBA backing will have an easier time securing loans because of the reduced risk associated with a government-backed loan. The Obama administration has expanded SBA programs in recent years to help put more capital in the hands of small business owners to expand their businesses.

Many SBA sponsored loans are specifially for business expansion and capital purchases and many are awarded based on certain factors, such as minority ownership of the business or location in an economically disadvantaged area.

Legislation passed in 2010 upped caps on SBA loans and also allowed for the refinancing of loans to help pay for commercial real estate development.

When considering making capital improvements to your business, it’s also worth your while to talk to your accountant or financial advisor concerning any tax advantages you may realize by building new facilities or buying new equipment. Tax law changes from year to year, but lawmakers routinely try to incentivize certain activities by business, and your improvements may be tax-advantaged. Checking with your financial advisor can help you determine if now is the right time from a tax standpoint to make improvements, or if by waiting a few months you can take advantage of pending tax benefits.

Finding financing for your capital needs is key to the growth of your business. By careful evaluation of your options and the advice of a financial professional, you can find an option that’s well-suited to your business.

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Top 9 Small Business Tips for Hard Times /top-9-small-business-tips-hard-times/ /top-9-small-business-tips-hard-times/#comments Tue, 18 Mar 2014 15:28:45 +0000 http://www./?p=1416 With anemic growth rates and tight lending conditions, it’s pretty obvious that these are tough times for all businesses, small businesses included. Between 2007 and 2010, small business failure rates have climbed by nearly 40 percent, according to recent research.

There are things that small business owners can do to help their businesses survive and thrive in hard times like these. The key factor is finding new efficiencies in your small business operations and optimizing your current operations. The following is a list of hard times tips for small business owners looking for a way to prosper in a difficult economy.

1. Form alliances with other businesses – You can save a lot of money by partnering with other businesses to share resources and cut costs. For example, if your business is great at website design but not so great at distribution, by providing website maintenance services work for a business that provides you distribution services, you can reduce your costs and take advantage of another business’ existing strength in an area instead of having to try and develop your own.

You can also share customer databases with partnering businesses, allowing you to generate leads more easily. This can be an invaluable source of new customers for your business.

When choosing businesses to partner with, you likely won’t want to partner with local competitors, as a competitor could unfairly take advantage of the arrangement to pilfer customer lists or take proprietary information from your business, such as manufacturing or service secrets. For distribution partnerships, working with local competitors may be acceptable, so long as the terms of the partnership are very explicit and put in writing. When choosing businesses to partner with, you should be careful to have non-compete agreements to keep your partner from shifting tactics to move in on your niche.

2. Reconnect with former customers – Go through your customer database and track down customers you haven’t heard from in a while. Inform them of new products and promotions by your business, and offer them a discount if they’ll stop by. If your customers haven’t shopped with you for a while because they were displeased with your business’ performance or service, address their concerns and bring them back into the fold. Taking care of their concerns will get them back in your customer base and head off any bad word of mouth displeased customers may be spreading concerning your business. Connecting with old customers may be easier and more cost effective than trying to find new ones.

3. Location – Some parts of the country are hit harder than others by the recession. California and Mississippi have some of the highest small business failure rates in the country, while other areas, such as North Dakota, Wyoming and Iowa have some of the smallest failure rates in the nation. If you’re starting a small business and have a variety of state location options, consider looking at the stats for your state before putting out your shingle there. If you’re able to locate in a more prosperous area, you may want to do this to boost your small business’ chances in the current difficult economy.

4. Boost your public profile – Get involved in your local Chamber of Commerce and local civic leagues. Host events at your business and contact your local newspaper or television or radio station for coverage. Any mention your charitable work may receive is free positive publicity for your and your business. Also try to get speaking engagements and make public presentations, as this will allow you to meet and network with other small business owners who can provide you with invaluable advice.

5. Sit down with the books – Go over your financials with a fine-toothed comb. Look for ways to cut your variable costs and also consider whether refinancing existing debt may help your business. Interest rates are at all-time lows, and while credit is hard to come by in the current market, a refinance loan can dramatically reduce your monthly debt payments, allowing your business more breathing space. By rooting out unnecessary costs and reducing your debt burden, you can make your business more competitive.

6. Aggressively market your business – Even if you have a shoestring budget for marketing, getting the word out about your business is important, especially in hard times. Consider unconventional guerrilla marketing strategies such as publicity stunts, walking billboards, t-shirts or other low-cost, high-impact methods of marketing. Get on Facebook and Twitter and leave a few reminders about specials and deals at your business. Social media sites are the most trafficked sites on the Internet, and you’d be surprised at how much a simple reminder of an event or bargain at your business can result in increased customer visits.

7. Make personal connections with your customers – One advantage small businesses have over their larger competitors is the ability to offer highly personalized service. Leverage that advantage as much as you can by reaching out to your customers personally. Take the time to send Christmas and birthday cards and also greet and chat with customers when they visit your site. Establishing a positive rapport with your customers can help keep them loyal and coming back to your business.

8. Purge your product or service line – Examine each product and service you offer and find the ones whose profitability is negligible or are unprofitable. If eliminating these offerings doesn’t interfere with your other business, you may want to cut them. Whittling down your product or service offerings allows you to refocus your resources to concentrate on better-performing products and services. If you’re not quite ready to give up the ghost on certain products or services, consider packaging them with more popular products or services. This allows you to get them out of your inventory, and can also help you capitalize on the popularity of another product to promote the less popular product.

9. Workforce reduction – Layoffs are something most businesses don’t want to consider, but cutting a few jobs is better than cutting everyone’s job if your small business goes under. If your volume of business doesn’t justify your current staffing levels, and recovery does not seem imminent, you may need to adjust your labor force to reflect the reality. When reducing your workforce, you’ll want to carefully review your workforce to determine which job cuts would have the least impact on your business. Be sure to follow all state and federal laws with regard to terminations, and also be sure to follow all terms imposed by contracts or collective bargaining agreements.

By taking the necessary tips to ensure your small business’ health in hard times, you can weather the storm caused by the financial meltdown of 2008 which the country is still recovering from and avoid becoming part of the small business failure rate. While workforce reductions and refinancing debt can be tough decisions to make, when your business emerges leaner and more competitive, you’ll know you made the right call.

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Contract Basics For Small Business /contract-basics-small-business/ /contract-basics-small-business/#comments Sat, 08 Mar 2014 18:45:23 +0000 http://www./?p=1419 Developing and understanding contracts is an important business skill that small business entrepreneurs must learn to run a successful business. Drafting ineffective contracts or signing contracts without understanding all their implications can lead to big financial losses and other difficulties for business.

Contracts are a fundamental part of the business world. Contracts are legally binding and enforceable documents that are made among businesses, employees, suppliers, service providers, the government and others.

Essentially, a contract is an agreement among two or more parties that creates a legal obligation. They can be made orally or in writing, although oral contracts are tougher to litigate in court.  If a contract is breached, the party that breaches the contract can be forced to pay damages, in the form of a specific action or a monetary award.

In business, contracts are used to ensure that agreements are acted on, and to enforce the terms of the agreement. Business contracts typically comprise independent contactor agreements, basic sales contracts, leases and rental agreements, selling or buying a business, franchising, joint ventures, partnerships, non-disclosure agreements, etc.

Elements of a contract

There are four basic elements of a contract: the offer, acceptance, intention to create legal relations and consideration.

The offer and acceptance of a contract are the key principle of the legal concept of contracts. Agreement is composed of an offer to another party that he or she is willing to enter a contract on specified terms. The contract comes into existance when the offeree accepts the contract.

This formula rests on the idea that the contract is formed when the parties involved are all of one mind regarding the terms of the contract. However, legal concepts such as promissary estoppel, misleading conduct, unjust enrichement and misrepresentation can be used as arguments in court that the contract is invalid.

The offer and acceptance do not always have to be verbal or in writing. Implied contracts may exist in some cases when the agreement or its terms have not been expressed in words. For example, a contract may be implied in fact when circumstances give credence to the belief that two parties have come to an agreement even when they have not done so expressly in writing or in an oral contract. For example, a patient going to a therapist has an implied contract with the therapist that he or she will pay a fair price for the services offered. If the patient does not pay, he or she may have breached a contract that has been implied in fact.

A contract in law offers courts the opportunity to remedy situations where unjust enrichment may have occured. For example, if a business were installing swimming pools at several homes along a street and mistakenly installed one at a home that did not request installation, and the homeowner allowed installation knowing that he or she did not order the pool and later refused to pay for the pool, a court could hold that a quasi-contract existed and hold the homeowner liable for the cost of the pool.

Intention to create legal relations is primarily the difference between social obligations and obligations at law. An agreement to give your brother a ride in exchange for gas money is a social obligation, an agreement to transport products for another business that’s made orally or in writing is more likely a legal relationship.

Consideration is basically something of value offered by the offeror that will be exchanged for something else of value from the offeree. For example, a product or service may be exchanged for another product or service or a payment.

Requirements for forming a contract

In order to form a contract, five legal requirements must also be met. Each party must have the capacity to contract. That is, the person signing the contract must have the standing and authority to do so. The purpose of the contract must be lawful. Contracts for unlawful purposes are not valid and are not enforcable in court. The form of the contract must also be legal. The two parties in the contract are required to have the intent to form a legal relationship when they agree to the contract. Lastly, each party involved in the contract must consent to the contract.

Contracts with customers and suppliers

Contracts can come in a variety of forms, non-disclosure agreements concerning business secrets, non-competition agreements with former employees or other businesses, employment contracts with independent contractors, etc. However, the most common contracts small businesses will sign are contracts with customers and suppliers.

The following are some tips for understanding contracts and making sure you don’t get trapped in a contract that is impossible to complete or is extremely disadvantageous:

- Make sure the contract is a specific as possible. The very best contracts for small business are clear and specific and focused on a limited number of issues. Terms of the contract such as number of products or services, delivery times, repeat service, etc. should be very clearly defined and unambiguously spelled out in the contract.

- Clarify all questions. Don’t automatically assume that conditions of the contract are implied. Always clearly answer every possible question the other party may ask in the language of the contract.

- Make sure it’s legal. Contracts for illegal actions are not enforceable. For example, if you sign and agreement to rent a facility to a business, and later find out that city regulations prohibit that business from operating there, your rental agreement may become invalid as a result.

- Read and understand the language of the contract. Make sure you understand all conditions of the contract, especially language detailing dates, services to be rendered, etc.

- Hire an attorney. When drafting your run-of-the mill service agreement, ask for an attorney’s advice on the document to ensure it’s legal and that all your bases are covered. If  your business is negotiating a big contract, it’s also probably worthwhile to have an attorney review it before you sign it.

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Managing Small Business Finances: Profit and Loss Game /managing-small-business-finances-profit-loss-game/ /managing-small-business-finances-profit-loss-game/#comments Tue, 18 Feb 2014 07:20:53 +0000 http://www./?p=1012 For owners of small businesses, financial management is a key survival skill. Without sound financial management, no amount of marketing, product development or customer service acumen will be enough to keep your business afloat. Good financial management practices give small business owners the tools they need to efficiently and effectively collect, keep track of and invest their money properly.

Poor financial management is a major reason why many small businesses fail. Even if you entrust your bookkeeping and accounting work to a professional, as the owner of a business you still need to understand the basics of financial management in order to make sound decisions.

The Basics of Bookkeeping

Good financial management starts with keeping good financial records. Even if you hire a bookkeeper, it’s important to understand the fundamentals of bookkeeping in order to supervise your bookkeeper properly, as well as being able to make well-informed decisions about budgeting, borrowing and other important choices.

For bookkeeping purposes, every business transaction you make should be documented by a check, receipt or sales invoice. These transactions should be entered into a journal, which can be a chronological record of sales and cash receipts, cash disbursements or other special entries.

Information entered into the journal should also be entered into a ledger. While journals provide documentation of transactions on a chronological basis, the ledger categorizes transactions according to which accounts they impact. Your company’s general ledger reflects your business’ balance sheet, revenues and expense accounts. The general ledger is completed at the end of each accounting period, when the information from your journals are categorized and posted into your general ledger.

In the double-entry accounting method used by most businesses, each transaction will impact two accounts, as every transaction will consist of a debit and a credit. One account will likely be a balance sheet account, while the other will be made into an income or expense account.

As an example, if you ran a plumbing business and charged $1,000 for a service, the service would be entered twice, once as a $1,000 invoice in the debit section, and once as $1,000 as income in the credit section. Once the fee was paid, you’d write up the $1,000 in your accounts receivable in the credit section, and $1,000 in the cash section of your balance sheet, a debit section.

When an accounting period ends, all of the account balances are added up and entered into the general ledger to produce a trial balance. In the trial balance,  the debit balances in your ledger sum should be equal to the sum of the credit balances. If they don’t balance out, you’ll need to investigate to see where the errors lie.

When you or your bookkeeper are done with the journals and ledgers, and you’ve come to the end of a financial period, you will need to close the books for that period.

Basically, this occurs when all entries have been posted to the general ledger and a trial balance has been prepared and checked and necessary adjustments have been made.

You’ll need to prepare a balance sheet, a summary of your company’s financial balances, and/or an income statement. Also, after all this is complete, you’ll then need to prepare closing entries for your general ledger by reflecting the profit or loss of the business in relation to the owner’s equity in the company. After that, you’ll start a new financial period with books set back to zero.

The Income Statement

The income statement, also called the profit and loss statement, summarizes your company’s profit or loss over a time period, such as a quarter or year. The statement reflects all revenue and expenditures over the time period.

Businesses typically use income statements to keep track of how much they make and how much they spend to help them gauge the business’ operating performance. A small business owner can use their income statement to see where cost overruns may be in their business, such as excessive phone, utilities or other bills. They can also help business owners see what products or services are hot, and what percentage of sales they account for, as well as help business owners determine their income tax liability.

Most income statements have three basic sections, the heading, revenues and expenses. The heading gives basic information about the business, such as name and address. The revenues section lists the money made by the business over the pertinent time period. The statement can lump all revenues into one, or break down revenues into a number of categories such as a line by line reflection of revenue from each store or product. The expenses section works the same way. Small business owners may want to use a very detailed income statement, as it can guide them to where their profits lie and what aspects of the business need help.

The Balance Statement
The balance statement is a good bit more comprehensive than the income statement. It may be the most complete reflection of the health of your business, showing all of the assets and liabilities of your business, such as property owned by the business, debts owed by the business etc.

There are many software applications that can help business owners do their books and create income and balance statements. It’s advisable for business owners who want to handle their own books to invest in these applications, as they can make the process less confusing and easier. Having good income statements and balance sheets are important, because they’re often looked at by banks when they’re deciding whether to approve a loan or line of credit.

Once you have a detailed income statement and balance sheet, you can use these informational tools to cut costs, identify areas in your business that need support and create long term plans based on your knowledge of the historical performance of your company.

For example, if your income statement reveals that you’re spending an exorbitant amount of money on utilities, you could use that information to start an energy savings program in your business. Or, if you see that one product line is generating most of your sales, you could beef up promotion of that product.

Bookkeeping and basic financial management provide essential informational tools to small business owners playing the profit and loss game. Be sure to understand the rudiments of bookkeeping to help put these tools at your disposal.







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