5 Fundamental Principles of Good Business Planning

Tim Berry — Tue, 21 May 2013 15:00:19 +0000

I’ve just finished a two-month period in which I’ve read more than 50 business plans as part of my role as judge of several major national business plan competitions and as managing investor of my local angel investment group. And I like reading business plans, so it wasn’t a sacrifice. But it did remind me that every so often, it’s good to go back to the five important fundamental principles of good business planning.

1. Form follows function

You’d think it would be obvious, but the business plan is supposed to be whatever it needs to be to solve the business purpose. For example, only very few business plans ever have to be documents – well formatted and carefully presented – to back up an investment pitch or loan application. While those uses exist, the vast majority of business plans need to be not pretty documents, but rather specific collections of lists, such as objectives, focus, tactics, specific activities, specific responsibilities, deadlines, performance expectations and so forth. They can exist in different formats and live on a computer, or a network, where multiple people can access, use and contribute to them.

The plan itself is what’s supposed to happen, and why, and how much of this and that and when things are supposed to happen. The document, the pitch, the elevator speech, and the summary memo aren’t the plan; they are outputs, or summaries, of the plan.

So why do we write it down? So we can review it every month, see what went right and what went wrong, and make course corrections. You can’t review the results of your plan if you didn’t write it somewhere. But don’t waste time making it pretty. Business plans are perishable, like food. Their shelf life is just a few weeks.

2. The beauty is in the results, not the plan

What makes a good plan? Not the writing, editing or formatting. Not even the ideas, the details, the strategy, the analysis or research. What distinguishes a good plan from a bad plan are the results. I’m quoting some of my books here, but the quotes apply:

A plan is worth the decisions it causes.
A good plan is nine parts execution for every one part strategy.

3. Accountability = metrics + management

In a business landscape changing rapidly because of new technology, the business planning is more needed than ever before because the traditional means of management and accountability are crumbling. It wasn’t that long ago that we could measure productivity by how warm the chair was, meaning how many hours so-and-so spent in the office. Now, with the world splintering and physical presence not so important, we measure with metrics, numbers – actual performance. And for that, we need planning to establish the expected measurement numbers and then to review the results and see what comes next. Planning is the key to accountability.

4. Planning thrives on change

Why should I plan, people ask? “Things are just going to change,” they say, “there’s no point in planning because things move too rapidly.”

The people who say that are missing the point. Planning is a process that manages change. The plan establishes expectations and the plan review analyzes results and creates revised expectations, in a step-by-step process that is something like steering, lots of small course corrections.

5. Planning is not accounting

The basic numbers included in a business plan – projections of sales, costs, expenses, profits, salaries, assets, liabilities, capital and cash flow – look like the reports we see in bookkeeping and accounting, but they are very different.

Accounting starts today and goes backward in time in ever increasing detail.

Planning, on the other hand, starts today and goes forward in time in ever increasing aggregation. We can’t project the future in detail; it’s a waste of time because the level of uncertainty is too deep. So we project a year in months and then the next two years on an annual basis, and that’s enough.

The good news is that this makes planning easier than a lot of people think. Just make sure, if you work with an accountant on planning, that he or she understands that 1) this is educated guessing; and 2) nobody is going to blame the accountant if it’s wrong.

Conclusion: All five of these basic principles are essential. And each of them makes planning easier, more practical, more important, and better managed.

Mentoring is Key to Small Business Success

bridgetwpollack — Wed, 15 May 2013 19:30:32 +0000

A lot has been written about why having a mentor is a good idea for entrepreneurs. One great article by Peter Cohan of Inc., gives seven reasons you need a mentor and another over on Tech Start Hub provides six. It’s clear that the experts agree: working with a mentor has a positive impact on startups.

But I want to show you evidence – hard numbers – that proves that mentorship really does create greater success for small businesses:

Thanks to a recent survey of our small business clients, we learned that in 2012 alone, SCORE’s clients started 37,054 new businesses and created 82,207 new jobs. Since 2009, 581,039 SCORE clients started enterprises, created employment opportunities or increased their revenues. Those numbers represent a huge impact in not only the success of that individual business, but also the prosperity of the U.S. economy and in local communities. This is all thanks to the hard work of our thousands of mentors across the country who meet one-on-one with hopeful or current small business owners and guide them through the obstacles and questions that they have faced themselves.

In addition to initial startup guidance, 71% of our survey respondents agreed that a long-term relationship with SCORE would be beneficial to them. And 80% agreed that they would recommend SCORE to friends or associates.

Mentoring is so effective because it is about skipping past the time and effort of “reinventing the wheel” of business ownership, and also pushing an entrepreneur’s vision beyond its normal limits. An outside perspective from someone who has been in your shoes can see the footpaths all around – the ones that scale mountains and the ones that avoid treacherous terrain.

So if you’re really ready to take your idea or business to the next level, bring in outside expertise. Connecting with a SCORE mentor is absolutely free and completely confidential. So what’s stopping you? Get in touch with a mentor today.

How to Market Your Business with Public Speaking

Rieva Lesonsky — Tue, 14 May 2013 15:44:25 +0000

Are you looking for a way to attract new customers, meet potential prospects and partners, and become known as an expert in your industry? Public speaking can do all of the above, and more.

If you feel like public speaking isn’t even an option for you because you’re shy, think again. I’m shy myself, though you wouldn’t know it to see me addressing conferences, crowds and audiences all over the country. Trust me, public speaking gets easier with practice—and it’s worth the effort.

Toastmasters is a great, free organization that can help you get comfortable speaking in front of a group. You can also try simply having a friend record you speaking and play it back so they can give you an honest critique of your speech patterns, body language and delivery. Finally, try breaking into public speaking with a less intimidating situation, like being on a panel discussion (where you’re not the focus of attention).

When you’re starting out in public speaking, it’s best to think small. Fortunately, speaking in front of small groups like the local PTA or business leads club can have huge benefits for your business.

Begin by figuring out what market you want to reach. For example, if you own a landscaping business, you might want to attract residential clients or owners of commercial facilities that need landscaping.

Next, determine where those customers are likely to be found. In the example above, you could speak to homeowners’ associations or gardening clubs if you’re trying to attract residential customers; for the commercial facilities, you could find landlord organizations and speak to those groups.

Figure out what type of subject matter will both be relevant to your target customers and also serve your business. For instance, the landscaper could speak to residential customers about choosing the right kinds of plants for different seasons, how to keep your home fire-safe with landscaping or how to prevent pests. For the commercial facilities you could talk about trends in landscaping or how to increase curb appeal. You want to talk about things that your business is able to provide for them, so there’s a natural tie-in between what you talk about and what you can do.

Promote the event. Use press releases, email marketing, your website and social media to let the local community know about the event. Depending on the venue, you may want to alert local media as well. (Perhaps you can even offer to write an article on the topic you’re speaking about, garnering even more publicity.)

Gather information about attendees. Have attendees sign up with their names, addresses and emails as part of registering for the event, or just make a sign-up sheet available at the event for people who want to get mailings or email newsletters from you. You could also do the classic “business card in a fishbowl” drawing and collect business cards in return for giving away a prize (like a free landscaping consultation).

Give away information. Handouts, brochures, checklists or other free information about both the topic you’re discussing and your business give people something to hang on to and remember you by. This is also perceived as adding value to your speech.

Follow up. Don’t be pushy, but do follow up after the event with attendees who’ve indicated interest in learning more or receiving communications from your business.

Keep it up. The more often you speak in public, the more confident you’ll grow, until eventually you may find public speaking to be one of your most successful methods of getting new business.

How to Restore Your Credit After Hard Times

BusinessCredit — Tue, 07 May 2013 13:44:17 +0000

Getting your financial life and credit back on track after going through tough economic times is not an impossible task by any means, but it does require an effective and proven plan.

Whether you had to file for bankruptcy; went through a foreclosure; dealt with excessive late payments, collections, judgments; a repossession; or the dreaded tax lien, the good news is there is hope in recovering and re-establishing a good credit rating.

First of all, don’t believe for a second that there’s nothing that can be done about past negative credit history — because there is. You can always work on repairing your credit reports; the Fair Credit Reporting Act protects your right to do so.

The first step to credit recovery is to establish new credit. The obvious step is to open up a secured credit card, right?

Well, not exactly.

The key is to establish at least three positive trades actively reporting on each of your reports with Equifax, Transunion and Experian. Actively reporting means you’re making regular payments; a loan that’s paid off does not count.

For example, if you’re currently making timely payments on a car note but have no other positive credit that’s active, then you should obtain two secured credit cards and use them regularly.

Keep your debt-to-credit-limit ratios on those cards at no more than 30%, and whenever possible increase your limits. The higher the limit, the better it is for you in the future when a creditor extends an unsecured credit line to you.

But before you go and open up two or three secured credit cards, you must select the right lenders, too! Did you know some of the high risk lenders offering secured cards can actually end up hurting you rather than helping you?

Think about this for a second: if you obtain a secured card from a high-risk lender, what does this tell other lenders about you?

It shows you are a high risk.

The key is to open a secured card from a mainstream lender — not a high-risk lender. Now keep in mind that opening up a few secured credit cards, making purchases and paying bills on time is a step in the right direction, but it does not address the current problem: your credit reports.

Did you know that by law you are entitled to receive one free credit report from each of the major consumer credit agencies every 12 months? You can obtain your free reports at annualcreditreport.com.

Review your reports and start repairing your reports by either working on them yourself or hiring a reputable credit restoration company.

Remember, it does not have to take a long time to put your credit problems behind you. Once you begin establishing new positive payment history, maintain at least three actively reporting trades and begin repairing your credit reports, you can restore your good credit ratings and scores.

Franchise Businesses Can And Do Impact Local Communities

FranchiseKing — Wed, 01 May 2013 12:30:17 +0000

Are you thinking of purchasing a franchise someday?

If so, you’re going to be focusing on things such as finding a franchise that’s a good fit for you, doing research, scouting out potential business locations and getting a small business loan.*

In other words, you’re going to have certain goals in mind when you start looking for franchise opportunities that could make sense for you. Most of your goals are going to be short-term ones. You’re probably not going to be thinking about some of the long-terms things—like how buying and opening a franchise business can and will impact your local area.

Start A Business

That’s how community impact begins.

It’s simple; open a franchise business somewhere in your local area, hire some employees and start growing it.

If you’re lucky—which means that several things happen in your favor—you may even be able to open up a second franchise location. If you were to do that, you’d be able to hire even more employees.

Adding new jobs to your local economy is only one way that opening a business impacts your area. When a new business opens up, other local area residents get to become involved, too.

If the new business requires a commercial space, you’ll need to hire the following specialists:

· Architects

· Contractors

· Light construction workers

· Sign makers

In addition, all businesses (whether they require a commercial space to operate or not) use attorneys and accountants, and they’ll almost always be local ones.

Impact

If you do become the owner of a franchise business, and your franchisor believes in community-related events and causes, you’ll be given the chance to really impact your local area.

A good number of franchisors do sponsor events and causes; some of them trickle down to the local level.

Here are a few examples:

Build-A-Bear Workshop

Stuffed with Hugs*, a Build-A-Bear Workshop® charitable program, is now in its eighth year of helping kids around the world. This annual event allows guests to visit their local stores and make a teddy bear for free to be donated to children in need of a hug. Year to date, more than 325,000 donations have been made to community organizations around the world.

Taco Bell

The Taco Bell Foundation for Teens has been inspiring and enabling teens to graduate high school and reach their full potential through its programs, partnerships and direct financial assistance. The Foundation’s support has impacted the lives of more than one million teens.

The Foundation offers core programs that motivate teens to stay in school and provide job training to help them identify career opportunities and interests. Go here * to see what the Taco Bell Foundation For Teens has been able to accomplish.

Sport Clips

Since 2007, Sport Clips* has been helping U.S. service members connect with their loved ones through their Help a Hero program, benefitting the Veterans of Foreign Wars’ Operation Uplink™ Free Call Days. Through company and client donations, more than 2 million phone calls have been made possible and almost 2 million dollars have been contributed to the program to date. In total, the Operation Uplink program has provided more than 7 million free connections to U.S. service members.

Panera Bread

At the end of each day, Panera Bread donates all unsold bread and baked goods to local area hunger relief agencies and charities as part of its local Day-End Dough-Nation program. Collectively, Panera bakery-cafes donated a retail value of approximately $100 million worth of unsold bread and baked goods in 2010 to help neighbors in need. Check out what else Panera Bread franchisees do.*

The examples above are just the tip of the iceberg when it comes to franchise organizations that get involved in various causes.

You can, too.

Just buy a franchise that will enable you to do so as part of your ownership experience.

*Non US Government links

Getting Stiffed: What Can You Do?

BarbaraWeltman — Thu, 25 Apr 2013 12:57:45 +0000

In business, it’s inevitable that sooner or later you won’t get paid for the goods you shipped or services you performed. Or you may have lent money to an employee or your business, but won’t be repaid. Being passive about the whole thing doesn’t help. Learn what you can do to get your money!

Collections
If a customer or someone else owes you money, it’s up to you to diligently try to collect. Invoices aren’t like fine wine -- they don’t get better with age. The longer you wait to collect, the less likely it becomes that you will collect all or even some of what you’re owed.

Collection efforts include:

In-house efforts. You or someone in your firm should contact the non-payer. Maybe the invoice was misplaced. Maybe the person just needs more time to settle up. Maybe you can work out terms to help the person pay what’s owed.
Sue in small claims court. If the amount outstanding is below the small claims limit in your area, you can quickly and easily proceed against the non-payer. Usually, you don’t need an attorney and the small claims court process is relatively inexpensive. For example, say you are a photographer who took pictures at a wedding but have not been paid because the couple didn’t like them. As long as you fulfilled your contract to take a certain number of pictures and they aren’t blurry or otherwise “bad,” you’ll likely win your claim when you present your case to the judge.
Attorneys. When your efforts fail to produce results, you can have an attorney help you. The attorney can send a letter to the non-payer, asking for prompt payment and stating that nonpayment can lead to your pursuing the claim to the fullest extent of the law.
Collection agencies. Instead of using an attorney, you might turn to a collection agency. Doing this means you won’t ever see the full amount you’re owed (the agency typically takes a percentage of between 25% and 40% of what it collects). For instance, say you’re owed $1,000 and agree to pay the agency 25% of anything it collects. After some time, it collects $600. You’ll only receive $450 ($600 - 25% fee). But something is better than nothing and leaving collection to professionals frees your time for other business matters. Check with your *Better Business Bureau when engaging a collection agency to see that they are reputable.

Tax write-offs
If you can’t collect what you’re owed, you may be able to at least take a tax deduction for your loss. Business bad debts are deducted on your business return as an ordinary write-off. For example, say you weren’t paid for a shipment of goods. After all collection activities have been used and you know that the funds are uncollectible (e.g., you shipped them to a company that has since gone out of business), you can deduct your loss.

When you lend money and are not repaid, determine whether it’s a business bad debt or a non-business bad debt. Clearly, if your company lends money to an employee who cannot repay the loan (e.g., he’s gone bankrupt), it’s a business bad debt. It gets tricky when you lend money to your corporation that doesn’t repay:

If you lent the money to protect your job, it’s a business bad debt and you can deduct whatever is not repaid as an ordinary business loss.
If you lent the money to protect your investment, it’s a nonbusiness bad debt. This is deductible only if the debt is wholly worthless. It is treated as a short-term capital loss (regardless of how long the debt was outstanding).

Caution: If you are on the cash method of accounting and are not paid for your services, too bad. Unfortunately, you can’t take a tax deduction for your lost time and effect.

Tax rules on deducting bad debts are in IRS Publication 535.

Lessons for the future
If collecting from tardy or delinquent customers has been a painful experience, don’t let it happen again. Change your payment arrangements so you are no longer in the position of having to collect after you’ve completed your job (e.g., shipped the goods; fulfilled the contract for services).

Get paid up front. This can be done by offering customers a wide range of payment options, such as cash, check, credit/debit card, or electronic payment (e.g., PayPal; AmazonPayments). Accept electronic payments on the spot using attachments from Square, Intuit, and others that turn your mobile devices into processors.

If you absolutely, positively must invoice, then adopt smart invoicing policies. Send them electronically and follow up if payment isn’t received promptly.

*denotes a non-government website

Business Planning and the Crystal Ball and Chain

Tim Berry — Wed, 24 Apr 2013 15:28:36 +0000

I came up with the phrase “crystal ball and chain” years ago to describe one predictable barrier to introducing a useful business planning process into an existing small business.

The phrase is intended to combine the crystal ball with the ball and chain. It happens because normal people, even good performers, and stars on a business team, naturally worry about changes. And when compensation is involved, and management structure, and raises and bonuses, it’s only natural to worry.

Good planning involves setting performance goals and tracking results against the goals. Milestones and metrics, which mean setting numerical goals and then tracking performances, are essential.

It’s obvious how this kind of tracking can help a business perform better. The plan vs. actual analysis gives the whole team an objective way to look back at what they planned – the milestones and metrics, in this case – and analyze what happened.

Still, good people still worry, because that’s a very human reaction. Are they trying to get the goods on me to fire me later?

Those objections almost always come as objections to the idea of predicting the future. People will say:

"But how can I possibly know today what's going to happen six months from now? Isn't that just a waste of time? Can't it actually be counter-productive, because it distracts us, and we spend time trying to figure out things in the future?'

The right answer to this, from the leadership of the business or business team, is about collaboration and cooperation. Projecting future business activities isn't a ball and chain at all, because in the right planning process the existence of the plan helps you manage effectively.

Here's a concrete example: it's September and you are developing your plan for next year, which includes an important trade show in April. You plan on that trade show and set up a budget for expenses related to that trade show. Even though it's September, you have a pretty good idea that this will happen in April.

When January rolls around, though, it turns out that the trade show that normally takes place in April will be in June this year. Does that mean the plan was wasted time? Absolutely not! It is precisely because you have a plan running that you catch the change in January, move the expense to June, and adjust some other activities accordingly.

In this example, the plan isn't a brick wall you run into or a ball and chain that drags you down; no, it's a helpful tool, like a map or even a GPS device, because it helps you keep track of priorities and manage and adjust the details as they roll into view.

We’ve all seen how technology is changing our attention span and sense of time. And we’ve seen how technology allows us to work at all hours, and from any location. These changes make planning and management, working with good planning that focuses on milestones and metrics, more important than ever before.

4 Tips for 50+ Entrepreneurs

bridgetwpollack — Tue, 16 Apr 2013 19:51:57 +0000

Americans age 55 and up are the fastest growing group of new business owners in our nation today. Already, more than 7.4 million Americans over the age of 50 work for themselves. "Fifty is the new 30," says Rieva Lesonsky, founder and CEO of GrowBiz Media and a member of the HuffPost Small Business Board of Directors. "Boomers don't feel or act their chronological age. We have a lot of good years ahead of us, and we don't want to sit idly on the sidelines. We'd be bored -- and many of us would simply run out of money."

There are many resources available for these entrepreneurs who don’t want to sit idly on the sidelines, so that they can pursue this self-employment option at this stage in their lives. Take advantage of these tools and tips to start this next phase off on the right foot.

1. Understand your readiness. The Small Business Administration (SBA) and AARP have partnered to offer an online self-assessment that will help potential small business owners understand their readiness for starting a business as well as information to help with business planning, shaping a winning business idea, professional counseling, financial services and information to find local resources in your area. This can be found at http://www.sba.gov/content/50-entrepreneurs. There is also a wealth of resources at http://www.sba.gov/encore.

2. Figure out your finances. With the economy still recovering from the recession, entrepreneurs need to find alternative ways to finance their business. Take the time to learn about the choices you have, and figure out what is best for you. Read about your options here: http://www.score.org/resources/obtaining-small-business-financing or listen in on this online workshop April 25 http://www.score.org/workshops/live-webinar-425-getting-your-business-ready-financing.

3. Beef up your tech knowledge. The majority of people these days can surf the web, email effectively, and even participate in social media. However, some businesses require a deeper understanding of technology, such as running an e-commerce business, implementing search engine optimization (SEO), and utilizing autoresponders. To make sure you start off on the right foot, and use technology to your advantage and complete more effectively, take a look at some of these resources at http://ebusinessnow.org/.

4. Get advice from those who know. Small-business owners who have a counselor see higher sales, hire more employees and stay in business longer. By talking with someone who has the “been there, done that” expertise, you can avoid a lot of the pitfalls that are common for small business owners. SCORE, a nonprofit organization and resource partner with the SBA, provides free and confidential mentoring from its network of more than 12,000 volunteers across the nation. Make an appointment in your local SCORE office, or visit www.score.org to ask your questions online.

It’s Time to “Spring Clean” Your Marketing Plan

Rieva Lesonsky — Tue, 16 Apr 2013 17:25:50 +0000

Spring is here—whether it feels like it in your part of the country or not—and it’s time to refresh and renew. That applies to your marketing plan, too. Are you ready to shake it up and sweep out the cobwebs?

Pull out your marketing plan and take a good look. What’s working, and what isn’t? You should be tracking the results of all your marketing efforts, whether you’re using online analytics, codes in print ads or simply asking visitors to your store or restaurant how they heard about you. Based on the information you’ve gathered, assess which marketing methods are getting the best results, and which are not doing so well (or are tapering off in effectiveness).

Next, think about why. Marketing methods can become ineffective for many reasons:
• You’re not promoting your message often enough. The old saying when it comes to marketing and advertising is “it’s the frequency, not the size.” In other words, a smaller ad or shorter radio spot that runs more often will stick in viewers’ or listeners’ heads more—and get better results—than a bigger ad that runs infrequently. Try spending the same amount of money on more frequent, smaller ads.
• You’re not promoting your message in the right places. If you notice you’re not getting the response you used to from one marketing avenue (or you’re not getting any response at all) it may be time to cut back or stop using that channel altogether.
• You’re not promoting your message to the right people. Audiences change, move away or grow up. The target audience for your regular advertising outlets may be different than when you started advertising there. Regularly check with representatives at your advertising outlets to learn the makeup of their audience. If the outlet no longer fits your needs, move on.
• Your message is poorly designed or doesn’t convey what you want it to. Do your ads, radio spots or marketing collateral pieces look outdated? Is your unique selling proposition or offer clear? Styles change quickly, both in terms of design and copywriting. Ask friends and colleagues to give you honest feedback about whether it’s time to update your marketing messages.

One smart way to make sure your marketing plan is fresh is simply to take a look at what your competitors are doing. I’m not advocating copying their marketing tactics, but if they’re advertising in a certain place, or using a certain method, maybe you should be, too. They could be getting great results from a tactic you’re not even trying.

It’s also crucial to stay up-to-date on marketing trends in your industry. Read your industry’s trade publications and blogs, and attend its conferences and seminars, to keep up with the marketing methods that are working the best for other entrepreneurs in your field.

Stay in touch with your customer base, too. Get regular feedback on how you’re doing, what they want from your business and what their biggest concerns are. Knowing this information will make it easier to tailor your marketing messages and choose the right outlets and tactics.

Finally, assess your marketing budget to see if it’s in need of an upgrade. Many small businesses make the mistake of skimping on marketing, then wonder why they aren’t seeing sales. See if there are other areas where you can squeeze out some extra funds from your business. Investing in your marketing, as long as it’s done with research and thought to back it up, is almost always a smart move.

Not All Suppliers Report A Company’s Positive Payment History

BusinessCredit — Fri, 12 Apr 2013 14:45:48 +0000

Getting approved for a line of credit with a supplier is simply an opportunity for you to start building your company’s creditworthiness. The key to establishing positive credit is to make regular purchases using your vendor credit lines, and then paying invoices on or ahead of the due date.

If you do not make regular purchases, then there is no way for you to establish any kind of payment history. So it is vitally important that you carefully select the suppliers with whom you apply for credit. Make sure that your business can use the products and services it offers to develop and grow your company.

This will allow your company to purchase the supplies it needs to operate without having to pay any money up front, enabling you to conserve cash while deferring payments for 30 or 60 days depending on terms.

It’s important to note that a supplier will only report an account once it begins issuing invoices to a company. Your account will show up on your company credit file based on several factors including invoice due date, reporting cycle and day of the month.

There are two key factors to remember:

Not all suppliers report to a business credit reporting agency.
Not every supplier reports on the same day, week, or month for that matter.

Now the good news is you have the ability to add positive trade references to one business credit agency, Dun and Bradstreet—but it does come at a cost. However, the first step is to apply for a DUNS number.

For the suppliers that do report, it’s important to note that each supplier has its own specific day to batch and submit payment data to a business credit reporting agency.

In addition, once payment data is submitted to a credit agency, then there is a short delay before it actually populates on a company’s credit report. So don’t expect to see a first payment showing up on a business credit report one or two days after paying an invoice.

For example, let’s say a company has a $5k line of vendor credit with a supplier that sells electronics with net 30 day terms. The company decides to purchase $1,500 in computer equipment using a credit line on January 11.

The company receives an invoice for $1,500 with a due date of February 10 (net 30 days). The company submits its payment to the supplier and it processes the payment on February 9. The supplier records the transaction, but its reporting date is on the 1st of every month. Since the invoice was paid after the 1^st of February, the payment transaction will not be sent to the credit agency until March 1^st, which is the next reporting date for that supplier.

So don’t get discouraged if you do not see a positive payment showing up on your company credit report right away. You can always inquire with the supplier, but it is always best to give it some time.

Another thing to remember is to which business credit agency the supplier subscribes. Not all suppliers report to all three agencies. Some suppliers report solely to Dun and Bradstreet, while others may report to Corporate Experian and Small Business Equifax.

Include Family In Your Franchise Decision

FranchiseKing — Wed, 03 Apr 2013 14:31:01 +0000

If you’re going to do a serious search for a franchise this year, please don’t make the mistake of not involving family members. Would you like to know why? Read on.

A Big Decision

The decision to become the owner of a franchise business is a big one. It’s not to be taken lightly.

And, while there are several ways for you to lower your financial risk,* franchise ownership doesn’t come with any guarantees. (Neither does a job!)

Your family members really need to understand what you’re thinking about doing.

That’s because if you do end up finding a franchise that you feel you can be successful in, you’re going to want to be supported in your decision.

Does that make sense?

Get Them Involved Early

The best way to insure that you’ll get the support you want and need is to get family members involved in the franchise exploration process at the beginning of it. Trust me, you’re not going to want to “surprise” any of them with an announcement like, “I just found a great franchise opportunity, and I really want to buy it!” (Especially if they had no idea that you were even looking at franchises.)

Now, you don’t have to have them involved in every little detail while you’re doing your search for a franchise, but you should definitely set a few goals together, including your budget. (Especially when it comes to your spouse, partner, or significant other.) You need to decide how much you’re willing to invest in a franchise-together. You should also discuss small business loan options.

The Decision-Maker?

Do you consider yourself to be the boss of your household?

In other words, are you the one that’s in charge of all things financial in your house? Are you typically the one who makes the final decision with regards to The Money?

If so, the suggestions that I’ve made so far may be a bit troubling to you.

In my role as a franchise advisor, my clients have included high-powered ex-CEO’s, and ex-Wall Street executives—people who are used to being in charge and getting their own way. Some of them, after hearing my “involve members of your family-especially spouses or significant others early” suggestion, have told me in no uncertain terms the following:

“I don’t need to talk to them about this. I’m the one who makes the decisions in my house.”

Really? Not in my experience. Nine times out of ten, in these situations, a family member appears on the scene—seemingly out of nowhere.

And the questions start: “Why didn’t you consult me on this?” is one of the most popular ones. It’s usually followed by, “How much is this going to cost us?” Coming in third on the hit parade is, “Are you kidding me? I thought that you were looking for a job!”

The bottom line: Major decisions are usually family decisions.

If you involve them in your decision to become the owner of a franchise (and early on), you’ll be in a better position to make a yes or no decision on the franchise of your dreams.

You’ve been warned.

*Non US Government link

Spiffing Up Your Place with the Help of Uncle Sam

BarbaraWeltman — Thu, 28 Mar 2013 12:58:13 +0000

There is little doubt that customers respond positively to the attractiveness of your workplace. In addition, it’s been *found that being in a good environment helps to motivate employees and adds to productivity. Improvements to your workspace may be modest or substantial, depending on your needs and your pocketbook. Either way, Uncle Sam can help defray the costs with tax write-offs. Here’s what you need to know.

Deducting repairs

A new coat of paint is a low-cost upgrade for your facilities. Other repairs may be more costly. Fortunately, the cost of paint and other repairs, whatever amount it may be, is fully deductible.

However, the cost of capital improvements has a different tax treatment than the cost of repairs, as you’ll see in a moment. The challenge in some projects is distinguishing between repairs, which are fully deductible now, and capital improvements, which are subject to special write-off rules. As a general rule, repairs to restore or maintain property, in contrast to capital improvements that materially add to the value of property, substantially prolong its life, or adapt it to a new or different use. (Pending rules discussed later may impact the definition of capital improvements.)

A determination of whether a cost is an ordinary repair or a capital improvement is based on the facts and circumstances. The following chart can help you distinguish repairs from improvements:

Repair	Capital Improvement
Fix a leaky roof	Replace a roof
Fix a dripping faucet	Replace old lead pipe with new copper pipe
Apply a new coat of epoxy sealer to a concrete floor	Install a new concrete floor
Fill a pothole	Repave

As a practical matter, you must make a business decision on whether you need to make a capital improvement or can remedy a situation with a simple repair. Don’t let tax results dictate your business decision.

Writing off capital improvements

Usually, the cost of capital improvements to realty must be treated as if you’d acquired a piece of realty; it is a separate asset. Since buildings have a 39-year recovery period for depreciation, it can take many, many years to write-off the cost of capital improvements. The good news: The write-offs for capital improvements can be claimed whether you pay cash or finance the project.

Special rules for leasehold, restaurant, and retail improvements. If your property fits into any of these categories, you can deduct improvements more rapidly than for improvements to other commercial realty. Leasehold improvements are improvements to the interior of a commercial building that was placed in service at least three years prior to the improvements. The improvements can be made by the lessor or lessee, but they do not include elevators or escalators, the enlargement of the building, the internal framework of the building, or any structural component of a common area. For restaurant improvements, more than half of the square footage of the property must be devoted to the preparation of meals and seating for on-premises food and beverage consumption. Retail improvements mean improvements to the interior of retail space open to the public.

The special tax rules for leasehold, restaurant, and retail improvements are:

First-year expensing (Sec. 179 deduction). You can write off up to $250,000 of the cost of improvements in the year the improvements are made. This deduction, however, only applies to improvements completed before January 1, 2014 (unless Congress extends the law).
50% bonus depreciation. You can deduct half the cost of the qualified improvements if you place them in service this year. Like the expensing deduction, bonus depreciation is set to end this year unless Congress extends it.
15-year recovery period. Instead of deducting the cost of improvements over 39 years, you can deduct them over 15 years. Again, the 15-year recovery period will end on December 31, 2013, unless Congress extends it.

These special rules can be combined to permit a write-off of all or most of your costs. For example, if improvements to the space you lease cost $400,000, you can expense $250,000, use 50% bonus depreciation for $75,000, and depreciate the remaining $75,000 of cost over 15 years.

New regulations

Proposed and temporary regulations from the IRS use new terminology (such as “betterment”) for distinguishing repairs from capital improvements. Unfortunately, they do not contain any “bright-line” rules, so you – as well as the IRS – will have to continue relying on facts and circumstances.

In addition to new terminology, the proposed and temporary regulations also adopt a favorable rule that lets you fully deduct the unrecovered costs of certain building components, such as HVAC and roofing, when they are replaced. For example, you own an office building and installed a new air conditioning system eight years ago. You’re still depreciating the cost, but now have to replace the system with a new one. You can deduct the remaining cost of the old one (the portion of the cost you had not yet depreciated), along with depreciation for the new one.

These regulations had been set to be effective starting in 2012, but the effective date has been postponed until January 1, 2014. However, they can be used for 2012 and 2013 returns at a taxpayer’s election. Whether they alter the classification of costs you incur for your facilities is difficult to say; work with a knowledgeable tax advisor for this purpose.

Resources

Some IRS publications can help you assess whether your expenditures for changing the look or functions of your workplace are repairs or improvements:

Audit Technique Guide on Repairs Versus Capital Improvements shows the government’s thinking on the question
Publication 946, How to Depreciate Property

Conclusion

Before you begin any project to change your workplace, determine the tax impact of your actions. Upfront deductions can help defray the costs and allow you to expand the scope of your project without a net cost to you.

*Denotes a non-government website

Demand ROI from Business Planning

Tim Berry — Tue, 26 Mar 2013 15:21:37 +0000

How do you value your business plan? What’s it worth to your business? Here’s how I do it:

I value the business plan by the decisions it causes.
I value a business plan by the money it generates.
I value a business plan by its results.

How do you value anything in business? For accounting purposes, expenses are negative value, and assets – things you buy, things you own, that aren’t expenses – are worth what you paid for them. But what’s the real value?

That’s where the phrase “return on investment” (ROI) comes in. Technically, ROI is the (return-investment)/investment. For example, the ROI of buying stock shares for $250 and selling them for $300 is (300-250)/250, which is 20%.

Please forget the formal financial definition, and consider this instead: every business expense—time, money, resources, reputation, and whatever—is an investment. What you get back is a return.

You don’t always get positive value back from what you do. Business meetings often cost more in wasted time than what they generate in information or business decisions. Many sales and marketing programs cost more than the dollars they generate.

So what about business planning? Here are some factors to consider:

People often mistake the purpose of business planning as if it were to have a business plan document to help with raising money from banks or investors. That happens, but it’s a small subset of the real business planning that goes on.
The investment in business planning can be measured (or estimated) as the sum of the management time invested, plus cost of consultants or writers or other outside help.
The return on most of the best business planning investment is a matter of decisions made, performance improved, increased accountability and other aspects of better management. That’s because proper business planning sets goals, establishes responsibilities, and helps with focus and prioritizing key elements of the business.
Sometimes the return on investment is insight. The people who develop the plan pull the business apart and see what makes the most difference, and what’s most important. Sometimes they see threats and flaws. Insight can be very valuable.
When it comes to raising money via banks or investors, making a business plan document is part of the process. The plan doesn’t raise the money, but you can’t raise it without the plan. Effort in making it easy to read and understand often pays off in making the information easier to get to for the people who stand as gatekeepers. But they don’t invest in the plan. They invest in the company and the people that execute the plan.
Some returns can be estimated as a negative. For example, the lack of planning means expensive surprises, lack of management priorities, lack of accountability, less-than-optimal reactive response to events, problems, and opportunities.

Taking the above into account, here are tips to optimize the return on investment in business planning:

Do only what you’re going to use. Don’t spend business time on a document unless there’s a specific business purpose.
Keep the plan streamlined, easy to build, easy to use.
Understand that the plan is just the first step in planning. It will be obsolete in days or weeks. Set schedules for regular reviews and revisions. Track results. Use plan vs. actual analysis to manage better and optimize business performance.

Ultimately, business planning is about better business—not better documents.

Communication Converts Leads

bridgetwpollack — Thu, 21 Mar 2013 16:09:52 +0000

Honesty is the best policy. Adopting an attitude of being clear and upfront has many benefits in life, from reduced stress to better relationships, but it can also be valuable in your business and key to converting leads into real customers. SCORE mentors will tell you that developing an open and honest relationship with your leads is important for several reasons:

- Honesty creates trust. If a lead feels comfortable sharing their needs and concerns, you can address them directly.
- An honest dialogue will determine if your business is well suited for addressing their needs.
- When choosing from multiple providers, a lead will choose the one that makes them feel most comfortable and capable of fulfilling their needs.

If you are able to honestly communicate your business’ capability to the leads, it brings you much closer to closing the sale and gaining a customer. Converting leads into sales is really about being a good match for client needs and effectively communicating that pairing. Here are some tips for effectively communicating your business to your potential customer:

KNOW YOUR COMPETITION AND KNOW WHERE YOU STAND
If you’ve positioned your business correctly, then you offer something different than your competitors. But it’s important to stay on top of how your competitors are changing and evolving their products and services. Check out their websites, follow them on social media and stop by their retail location. This will allow you to communicate your uniqueness to your customers in an informative way.

SEE WHAT YOUR CUSTOMERS SEE
Remember – you are a consumer too. Put yourself in your customers’ shoes and think about things like “What’s the first thing I would want to see upon walking into a specific business?” If you’re having trouble seeing from that perspective because you are too close to your business, ask your friends, family and colleagues for their opinions.

TAKE ONE STEP FURTHER
If you’ve effectively communicated your business to a lead and their needs align with what you can offer—but they are still hesitant, you must nurture that lead. If this is your first time in sales, and for many small business owners it is, this can be an uncomfortable proposition. Think of lead nurturing efforts as friendly reminders. Here are some tactics for lead nurturing. See which works best for your customer base and your personality.
1. Be concerned
2. Be persistent
3. Remind of benefits

GET FEEDBACK
It is crucial to take stock of how your lead conversion efforts are working and modify as necessary. Solicit feedback from both successful and unsuccessful conversions to see what you’re doing right and where there’s room for improvement. For unsuccessful conversions, ask questions like, “Did we effectively communicate how we could meet your needs?” and “What caused you to choose another provider for this product/service?” For successful conversions, ask questions like, “What made you choose our business as your product/service provider?”

As with most things in life, honesty about you and your business is the best policy.

Creating Customer Loyalty Programs

Rieva Lesonsky — Tue, 19 Mar 2013 16:10:45 +0000

These days, loyal customers are hard to come by. So when you do have customers who are faithful to your business, returning day after day and year after year, you want to reward them. But how? There are many ways to reward your loyal customers, from simple paper-based methods to mobile apps and more. Here’s a look at some different options to consider.

Rewards cards: Depending on your customer base, your budget and how sophisticated you want to get, you can start at the basic level with paper punch cards (“Buy 10, get one free”). You can also use plastic loyalty cards that you swipe to track customer purchases and other data, which can be more useful in helping gather information for your future marketing programs than are paper cards.

Discount programs: Consider rewarding loyal customers by giving them a discount when they reach a certain purchasing level or if they buy a certain number of items within a specified time.

Give a gift: One great way to encourage loyalty is simply by tracking a customer’s relationship with you and other important data. For instance, if you record the date of first purchase, a customer’s birthday or other relevant dates, you can give them a gift on those “anniversary” dates. You can also offer gifts with purchase (like cosmetics companies do, with great success) when customers buy a certain dollar amount or volume of product.

Create a VIP program: Allow customers to sign up for a VIP program where they get some type of reward relevant to your business. This could include discounts on purchases, special sale days just for them, advance notice of sales or access to special information such as a VIP email newsletter.

Hold events: Events for loyal customers can be a great way to reward them. Consider opening your store or business at a special time for them to shop; holding a special dinner at your restaurant that only your “regulars” are invited to; or holding a seminar or training session for your faithful service business customers. The ideas are limited only by your business.

Mobile apps: Applications such as Belly, Spendgo and Womply streamline loyalty by enabling customers to enter or swipe their account information, using smartphones or tablets, to win prizes, get store credits or free products, or get cash-back rewards for making purchases. You can customize the rewards programs to work with your goals.

Get personal: Sending a handwritten thank-you note or making a phone call are very meaningful ways to thank your loyal customers that they won’t soon forget. In fact, in today’s digital world, these old-fashioned methods just might be the most memorable and effective customer loyalty tools of all.

What is the Best Small Business Credit Card for Establishing Creditworthiness?

BusinessCredit — Thu, 14 Mar 2013 15:58:29 +0000

With fast access to cash, convenience and all the perks that come along with it, a business credit card is a standard tool used by business owners.

But did you know that less than 50% of the credit cards obtained by business owners nationwide are actually in the company’s name?

It’s a shocking reality, to say the least, but the good news is there are plenty of business credit cards that cater to savvy business owners like you who understand the importance of establishing business credit.

The majority of cards one can obtain for a business also have a great deal of benefits such as cash back rewards, rewards points, travel rewards and detailed reports.

Those aiming to strengthen the credit of a business must understand that it’s vital to obtain cards that report payment activity to a business credit agency.

When applying for credit, one of the ways to identify a non-reporting issuer is by what’s required on the application. If all that is required is to supply personal information, a social security number and business name, then this card issuer in most cases will solely report to a consumer credit agency.

Take it a step further and simply read the disclosure section on the application. It will read something like, ‘I Authorize the receipt and exchange of credit information on the business signer, including the exchange of information between XYZ credit card issuer and its affiliates.’

Nowhere here does it disclose that the ‘Business’ will be included in the receipt and exchange of credit information it just states the business signer. (That’s you!)

If this is the case, then be aware that you will be personally liable for all debt your company incurs on this card and all payments and any revolving debt will be reported to a consumer credit agency. This type of business credit card is nothing more than a glorified personal credit card with your company name on it.

Now don’t get discouraged, because there are cards that may require a personal credit check. But the good news is payment activity is reported to both consumer and business credit reporting agencies.

While credit cards that fall right into this category may not be my first recommendation, at least it helps establish company creditworthiness because it reports to several business credit agencies.

The downfall is that your company’s revolving credit card debt is still reporting on your consumer credit reports, resulting in a negative impact on your personal credit scores.

Ideally, the best small business credit card is one that reports only to business credit reports. Thankfully, there are issuers offering these types of cards despite the challenges in the economy.

But before you get too excited, know that most issuers will require a personal and business credit check. The most important thing to remember with these cards only your business credit reports will reflect your revolving debt, therefore protecting your personal credit scores.

Should Former Independent Business Owners Look At Franchise Ownership?

FranchiseKing — Wed, 06 Mar 2013 13:09:47 +0000

Sometimes, the best-laid plans don’t pan out.

Take business ownership, for instance. Think about how many businesses are started and closed in the US every year. Not every business makes it. But, every small business owner wants to make it. Why else would someone risk their money, and commit the time and energy needed to be their own boss?

Working For Yourself

I’ve been my own boss since 2001. I call the shots. I decide my marketing budget. I decide how much of a salary I take out of my business. I choose when to take a vacation. I choose my days off. I have total freedom and control.* It is as fantastic as it sounds. I don’t plan on giving it up.

A few years ago, a business attorney referred someone to me who was interested in franchise ownership. I contacted the gentleman, and our conversation went something like this:

Me: “Hi, Jack! I’m returning your phone call from yesterday. The message you left on my voicemail said that you were referred to me because you were thinking of looking at franchise opportunities.”

Jack: “Yes, Joel. An attorney friend of mine knows of you, and he told me to call you for information and advice.”

Me: “Great. So, why are you thinking about looking into franchise ownership?”

Jack: “I had a pretty successful business for 10 years, but I recently had to shut it down. It turns out that the CFO I hired messed up the books big time, and I had to liquidate everything. I owned several retail stores. I’m kind of at a crossroads here. I’m hoping that you can help me find a good franchise.”

Me: “I’m sorry to hear that you lost your business. This must be a pretty rough time for you.”

Jack: “It is. I was doing pretty well, too. Put my kids through college, and enjoyed the fruits of my labor. I’d like to find another business. I was thinking about a franchise.”

Me: “Well Jack, I’d be happy to work with you, but here’s my fear: you’ve been an independent small business owner already. You’ve been the guy running the show, right?”

Jack: “Correct. I was the boss. I made the rules. But, I have to tell you; I think that it would be really hard for me to work for someone else…you know, go out and get a job.”

Me: “I totally understand. I can see where you’re coming from.”

Jack: “Yep. No ‘job’ for me, thank you very much.”

Me: “Well, you do know that if you buy a franchise you’ll have to follow someone else’s system. In franchising, there are a lot of restrictions…a lot of rules, and I’m a bit concerned that some of them may be kind of tough for you to adhere to since you’ve been the one making the rules for the past several years.”

Jack: “Joel, let me share something with you; I’m almost 60 years old. I’m probably not going to be able to find a good job, for what I’d need to be paid. It’s just not realistic. If I were to find a good franchise to own, I really would have no choice but to follow their system. And, I know I could do it, Joel.”

Jack Did It

After our conversation, I was able to spend time on the phone with Jack. He was able to convince me that he would adapt quite well to a franchise business. He spoke from the heart, and I felt that he was really sincere about following someone else’s system.

Jack and I were able to come up with some ideas, and he ended up buying a B2B franchise.* He was even able to get his sons involved, and they eventually took over the business.

It’s a great story, and I’m glad that things worked out for them. But, should all former independent small business owners look into franchise ownership?

My answer is no, and it’s because of the rules.

Transitioning from rule-maker to rule-follower is a tough one. It’s one of those things that sound pretty good on the surface…during the planning stage, but when reality sets in, it may not be a pretty picture.

Independent small business owners that have been around for a while-and that have a reasonable track record of success, know a lot about business. They may have some great ideas…ones that the executive team may not want to hear.

There’s a real potential that egos could collide, and I haven’t seen that many good things come of situations like that.

If you’re a former independent small business owner, and you’re thinking of going the franchise route this time, make sure that you’re really ready to use someone else’s business system.

If you can do that, you may end up like Jack.

*Non US Government Links

What’s a Small Business for Tax Rules?

BarbaraWeltman — Thu, 28 Feb 2013 12:55:53 +0000

The SBA uses a number of definitions for “small business,” depending on the industry. So, too, does the tax law, which has various definitions of “small business” for different tax breaks. These definitions are based on employees, revenues, expenditures and assets. Confusing? You bet! Here’s a list to help you.

Employee-based definitions

DbK retirement plan. This type of qualified retirement plan, which has yet to be utilized because of lack of IRS guidance, combines a pension with a contributory element (like a 401(k) plan). It is limited to companies with 500 or fewer employees.
Disabled access credit. A tax credit of 50% of costs between $250 and $10,250 (maximum credit of $5,000) can be claimed for the cost of making a company more accessible to the disabled. The company can have no more than 30 full-time employees during the preceding year; there is also a gross receipts (revenue) test explained later.
Employer wage differential credit for activated reservists. Employers with fewer than 50 employees can claim a tax credit for continuing to pay wages to employees called to active duty.
Retirement plan start-up credit. A tax credit of up to $500 for the administrative costs of starting a qualified retirement plan can be claimed by a company with no more than 100 employees who have compensation over $5,000 in the preceding year.
Savings incentive match plans for employees (SIMPLE) plans. These are retirement plans to which employees and employers both contribute. SIMPLE plans can be used by a business with 100 or fewer employees who received compensation over $5,000 in the preceding year.
Simple cafeteria plans. Cafeteria plans are used to offer a menu of fringe benefits to employees. A simple version, which avoids the need for testing for discrimination, can be used for a company with 100 or fewer employees on business days during either of the two preceding years.
Small employer health insurance credit. A credit of up to 35% of premiums paid in 2013 by employers can be claimed by a company with no more than 25 full-time equivalent employees (FTEs) with average wages of less than $50,000. The full credit applies for up to 10 FTEs; a reduced credit is allowed for 11 to 25 FTEs.

Revenue-based definitions

Accrual method exception for small inventory-based businesses. While, most firms with inventory must use the accrual method of accounting to report their income and expenses, “small” firms can use the cash method. Small firms are those with average annual gross receipts of no more than $10 million in the three prior years (fewer years if the company hasn’t been in business for three years).
Bad debts deduction. Small businesses performing services in certain fields (e.g., law, accounting) can write off bad debts on the non-accrual experience method, which means they don’t accrue service-related income expected to be uncollectible. This accounting rule applies only to companies with average annual gross receipts for the three prior years of no more than $5 million.
Corporate AMT exemption. Small C corporations are exempt from the alternative minimum tax. This exemption applies only to those with average annual gross receipts of no more than $7 million ($5 million for the first three-year period).
Disabled access credit. The credit described earlier can be claimed by a company with gross receipts of no more than $1 million in the preceding year (see the employee definition above).
Late filing penalties for certain information returns. Businesses must report certain payments to the IRS by set dates. Reduced penalties for the failure to meet this obligation apply to companies with average annual gross receipts of no more than $5 million for a three-year period.
UNICAP rules. These rules impact when expenses can be deducted. There is a small reseller exception for property acquired for resale; the exception applies to companies with average annual gross receipts of no more than $10 million for a three-year period. There is a simplified dollar value last-in, first out (LIFO) method for applying the UNICAP rules; the method applies only to companies with average annual gross receipts of no more than $5 million for a three-year period.

Expenditure-related definition

First-year expensing. The cost of machinery and equipment can be deducted upfront rather than depreciated over a number of years if total annual investments in these assets do not exceed a dollar limit. For 2013, the full expensing deduction of up to $500,000 can be claimed as long as purchases don’t exceed $2 million. This dollar limit is reduced for excess purchases; no deduction applies once purchases for the year exceed $2.5 million.

Asset-related definitions

Shifting the burden of proof to the IRS. Whether a worker is an employee or an independent contractor or whether compensation is “reasonable” can be shifted to the IRS for a business with a net worth not in excess of $7 million.
Small business stock. Gain on the sale of qualified small business stock in certain C corporations acquired after September 27, 2010, and before January 1, 2014, is not taxable if the stock is held more than five years (a partial break applies for stock acquired before or after these dates). The stock is “qualified” only if the corporation’s gross assets do not exceed $50 million when the stock is issued and immediately thereafter.

Conclusion

There are many tax breaks exclusively for small companies. Knowing whether you are eligible for a particular one depends on the tax law’s definition. If you’re unsure, talk with your tax advisor.

7 Quick Tips for Better Business Communications

Tim Berry — Wed, 27 Feb 2013 17:07:25 +0000

It used to be that most of the business world understood that simple, clear business writing was a powerful skill. We needed to communicate, explain and convince people in memos, proposals, plans and reports. Simple sentences worked better. Clear and concise worked better.

Maybe I care more about writing than the next person because I’ve spent so much of my career dealing with business plans: writing them for years, then getting them funded and, more recently, reading them. I read more than 100 business plans a year. They’re shorter than they used to be, for sure; but the qualities that make something readable—including good writing, spelling and grammar, are as important as ever.

But writing has been diluted, for sure, with the forward march of email, websites—and now Facebook and Twitter and text and rushed communications with two thumbs while trying not to bonk the other people sharing the sidewalk. So writing, spelling and grammar seem out of style; but still, some writing comes up all the time. The business plan is just the most obvious example. Beyond that:

In email
In blog posts
In comments to blog posts
In social media updates
Plans, memos, reports
In text or sms messages? I’m not sure about that one. What do you think? The obvious abbreviations are so tempting ... but does that have to spread into the rest of our writing. I forgive “idk” in a text but not in a memo (it stands for I don’t know).

So here are some of my suggestions for minding the writing without ignoring that it’s relegated to many kinds of in-between and compromise contexts, like text and on smartphones. And with business plans too, of course.

Use short simple sentences. Use periods more often to end sentences. Separate your points into shorter sentences.
Get to the point fast. Put the headline first—then explain. People skim emails and memos. Don’t bury the main point in a dumpling-like mass of explanations.
Stop using apostrophes to show plural. Apostrophes are for contraction (don’t) or possession (Ralph’s or Mary’s opinion). Stop putting an apostrophe every time you have a plural noun. It’s balls and bats, not ball’s and bat’s.
Then and than have different meanings. Then is time and sequence, as in first we do this and then that. Than is comparison, like more than and less than.
Simple words are better. Avoid jargon and buzzwords. Don’t incentivize people when you can motivate or encourage them instead. Use things; don’t utilize them. The phrase “outside the box” is inside the box. Are we really all engaging all the time?
Although it does take an extra effort to hold down two fingers at once or add a keystroke to capitalize words, it looks better. Capitalize your words like you learned in second grade.
Don’t write long emails with multiple topics and points. Make each email have its own topic and subject line. Your recipients will get your point faster and better than way.

While it’s apparently true that we live in a world of video, and books and print media are in a decline, technology has also put writing into almost every obscure corner and extra little piece of time in our lives. Not just for business plans. In all cases, let’s do it well.

4 Factors to Consider When Deciding About Financing

bridgetwpollack — Thu, 21 Feb 2013 16:39:22 +0000

If you are looking to make any major improvements in your business, whether it is a second location, new equipment, or an additional product line, you most likely need business financing. But getting financing for your business can be intimidating. Despite this economic downturn, banks are still lending. However, the way banks are lending to small businesses has changed pretty significantly and they are more cautious about where the money is going, especially when considering a loan to new businesses with no track record. As a result, you may need to consider a number of options to get the money you need, whether you are looking to launch a business or need additional financing for an existing enterprise. However, before you look into alternative financing, talk to a SCORE mentor about the various factors that influence which financing option will suit your needs:

Business Impact

According to the U.S. Small Business Administration, factors financing institutions take into consideration include determining the specific uses for which you need the money, whether your business is seasonal or cyclical, and whether you plan to expand. Work with your SCORE mentor to create a written business plan that will help you clarify your financing needs.

Types of Financing

Common types of financing include bank loans, SBA loans, crowdfunding, receiving funds from a venture capitalist (in which you take on investors in exchange for providing them with an ownership stake), or borrowing from friends and family members. If your small business is engaged in scientific research and development (R&D), you may qualify for federal grants under the Small Business Innovation Research (SBIR) and the Small Business Technology Transfer (STTR) programs. You may need to solicit funds from all of these sources to obtain the amount of money you need. You could also tap into personal savings or even take out a second mortgage on your home.

Pros and Cons

Each type of financing offers certain benefits and pitfalls. For example, grant money, venture capital funds and your own money do not have to be repaid, so you won't incur additional debt. If you borrow from family and friends, you may receive a low interest rate as well as flexibility in payment terms. If you borrow from a bank, you may have more stability, avoid using your own money, as well as avoiding the potential tough situation of approaching people you know to ask for money.

If you borrow from friends and family, you need to consider what would happen to your relationship if your business fails and you cannot repay them. If you default on a bank loan, you could lose your business and need to file bankruptcy. If you work with venture capitalists, you may need to relinquish some control of your operation.

Potential

Whatever method of financing you decide to pursue, your ability to sell your business concept for starting or growing successfully will increase the potential of obtaining financing when asking for money. Factors that will help you sell your idea include a solid business plan, the ability to demonstrate the need for your business in the marketplace, and any successful business experience you had in the past. Talk to your SCORE mentor today to get started with your financing planning needs.

6 Ways to Market to Penny-Pinching Customers

Rieva Lesonsky — Tue, 19 Feb 2013 15:17:33 +0000

The Great Recession technically ended back in 2009, but you wouldn’t know it from the way Americans are spending (and saving) these days. Despite some natural post-election optimism, issues such as rising food and energy prices, Congress’ “fiscal cliff” and debt ceiling struggles, and the rise in the payroll tax mean Americans are still clutching their wallets tight. With many Americans widely feeling that “we’re not out of the woods yet,” how can your small business develop marketing messages that resonate with penny-pinching prospects?

Start by understanding what your customers and prospects are worried about so you can tailor your marketing message accordingly:

A Gallup poll conducted last month reports that for consumers with incomes under $24,000, the costs of food and energy were the biggest concerns (cited by 81 and 80 percent, respectively), with healthcare costs (70 percent) and taxes (67 percent) close behind. Lower-income and middle-income consumers are being hit hard by the expiration of the payroll tax cuts in January, which cut about $1,000 in take-home pay from someone making $50,000.
Upper-income consumers (with incomes of $90,000 and up) were more likely than lower-income consumers to be worried about longer-term issues such as taxes (cited by 79 percent) and the federal debt ceiling (66 percent).
If you’re a B2B business selling to small business owners, know that they’re worried about the same costs consumers are. A recent Wells Fargo/Gallup Small Business Index survey found small business owners say taxes, energy costs and healthcare costs are hurting their businesses more than anything else.

So what kinds of marketing approaches will resonate with each of these groups?

Lower and middle-income consumers are worried about the short term. Their paychecks just got smaller while their cost of living is rising. As a result, they’ll be responsive to marketing that offers:

Immediate discounts. Draw them in with sales, coupons, stock-up-and-save specials or two-for-one offers.
The ability to stretch a dollar. Position your business as an advocate, helping them save for what’s important to their households. That could include offering flexible payment plans or layaway programs to help them afford bigger purchases.
Understanding. Emotion is important in purchasing decisions. Your marketing should appeal to these customers’ desire to provide for their families, treat themselves and have fun without breaking the bank.

While upper-income consumers have some of the same short-term concerns, they are more focused on long-term issues such as how taxes and government regulations will affect their future income and savings. As a result, they’ll be responsive to marketing that offers:

Flexibility. Upper-income consumers want to splurge when they can, but to do this they also need to save when possible. The three-tiered pricing strategy works well with this group. Develop a silver, gold and platinum package in the low, mid-priced and high-end range. Often, customers who might normally go for the lower price will be more open to buying a midrange package when there’s a higher-priced option, because they feel like they’re still saving money.
Value. Your product or service doesn't need to be rock-bottom priced if you can convey its ultimate value. In other words, is what you sell worth the cost because it saves time, saves money in the long run or will last 20 years?
Understanding. For this group, focus on the longer-term benefits your product or service offers, such as how it protects their investments in their homes, helps them become better at their jobs so they have more job security, or helps them create lasting family memories.

How a Virtual Office Creates a Professional Corporate Image

BusinessCredit — Thu, 14 Feb 2013 20:25:25 +0000

During the initial stages of the business credit building process, I’m sure you have heard about the importance of setting up a commercial office location. A physical location that is zoned for business speaks volumes for your company and its operation.

If you decide to use your home address for your company’s business address, keep in mind that some lenders may not extend credit to a “home-based” business. However, you still have many credit opportunities with a home-based business; so don’t let that stop you.

If you do decide to use your home address, make sure you designate a specific area in your home where you can run your business in order to allow for the proper home office tax deductions.

But, if you’re adamant about having a commercial address but renting office space is out of the question, then you may want to consider a virtual office address.

Some companies offer a turnkey corporate image with all the tools you need to not only run a business, but to meet the business credit building requirements.

For a flat monthly fee, you get a business phone number, a live receptionist answering phone calls, a corporate business address for all your mailing and packages, personalized voice mail box that converts to email, and even a fax number that will convert to email.

It is an excellent solution for start-ups and small businesses looking to keep costs low while gaining all the resources of a professional corporate image.

If you are searching for a virtual office, consider one that includes the following:

Dedicated business phone number
Professional live receptionist answering calls in your business name
Corporate mailing address
Business fax number
Fax forwarding to email
Voice mail forwarding to email
Corporate voice mail boxes
Call forwarding to multiple phone numbers

While there are many companies offering virtual office services that can accommodate your business, it’s important to utilize the most cost effective solution as a startup company. There are companies that offer this type of service at an affordable price so you can establish a corporate image with all the resources already in place.

Keep in mind if you decide to set up a virtual office, make sure that all of the information you supply is identical to the information you have on your corporate documents. This includes things like the spelling of your company name to the description of your business operation.

Remember, there should be no differences in your company information across all business documents, registrations and listings.

Give your business the professional image you require to get ahead of the competition while you meet the compliance demands from creditors, suppliers and lenders.

4 Ways to Use Google Hangouts in Your Business

smallbiztrends — Wed, 13 Feb 2013 21:28:47 +0000

Small business people still seem to be in the process of catching on to Google+, the social network created by Google. Google has made a number of moves to encourage people to use Google+. It has tied in several applications to Google Plus.

One of those applications is Google Hangouts. Hangouts are a type of online group meeting using webcams so that each of the participants can see and hear the others. Think video conference and webinar all rolled up in one.

With Hangouts, you can hold group presentations online and automatically record them for YouTube, and archive them for later access. You can stream live broadcasts directly from your website, YouTube channel and/or Google+ profile with just a few clicks. Even better, you can save your recorded Hangout videos and post them on your site. If you wanted to try offering webinars, this is a no-cost way to do it – because Hangouts are completely free to do.

So what exactly can you do with Hangouts? Here are 4 suggestions:

1. Conduct Team Meetings

With so many teams having members spread out in different locations or working from home, just scheduling an in-person team meeting can be a challenge. Traveling to attend meetings can be costly and more importantly, time consuming.

Conference calls are the typical way of handling meetings when everyone cannot be present. But phone communication leaves a lot to be desired. When you can’t see facial expressions, miscommunication can arise. Worse, in today’s world, team members can succumb to distraction and start focusing on their smartphones instead of the team participants. When you can see one another, those issues are minimized. People tend to stay alert and engaged.

Need to share a Web URL to the team, or share your screen to show them something? With Hangouts you just push a button and you can do that.

With Hangouts, the person who happens to “hold the floor” and is speaking at the moment, has his or her video screen showing in the large view. Other participants’ screens are minimized until they speak.

And yes, you can restrict Hangouts to make them private.

2. Hold Webinars

Have you ever wanted to share expertise and have it available online, perhaps to establish yourself or a company executive as a subject matter expert? Or perhaps you want to start a webinar series as part of your content marketing repertoire. Or maybe you want to provide a question and answer session for customers or prospects, about a product offering either for sales or customer support purposes.

Hangouts are an interactive way to do all of the above. Hangouts normally are limited to 10 active participants (available to 15 participants with Google+ premium features). Their small size of active participants keeps them rather intimate and encourages participation and questions.

With Google Hangouts On Air, you can broadcast your Hangout publicly. You can record it, edit the recording, and share the recorded event online.

If the cost of webinar software has kept you from experimenting with webinars or customer Q&A sessions, then Hangouts are a low-risk way to experiment. Same with technology issues – if you have been concerned with the technical elements of holding webinars, hangouts are pretty easy. There’s a free Google video chat plugin you will be prompted to download and install upon your first Hangout – but it’s fast and easy. You don’t have to worry about trying to make recording software sync up. You simply start a Hangout, name it and you’re good to go.

3. Offer Consulting Hours

Remember when you were in college and your professor held Office Hours so students could get individual help? Why not offer the same feature as a consultant?

You could offer customized coaching services. A Hangout session with your client can replace phone calls and emails, or lengthy and expensive travel.

For smaller consultants and professionals, it can differentiate your business from competitors. You’ll look high tech, at no extra cost. And Hangouts can allow you to offer an expanded range of services, such as paid coaching sessions that can be advertised and scheduled on your website. Musicians can offer paid music lessons. Only your imagination is the limit.

4. Hold a Press Conference

Who says press conferences are limited to big companies? Recording artist Taylor Swift hosted a Google+ Hangout to announce her new album. During the live chat, Taylor answered fan questions from around the world, let them know what they could expect from her album, and debuted its first single. When her single was released on iTunes it went straight to number one, faster than any other song in history.

Have a big announcement – whether it’s a new executive hire, a new product, or simply to announce that you’ve won an award? A Google Hangout lets you tell the world and provide an interactive record of the announcement.

There are many ways for small business owners to use Google+ Hangouts to connect with their customers, build their brands, monetize their businesses, and create buzz. Check out the Google Live Events calendar to help spur some of your own ideas. You can also add your own events to the calendar to increase your reach. And check out this article with more ways to use Google Hangouts.

Restrictions in Franchising

FranchiseKing — Wed, 06 Feb 2013 15:33:37 +0000

If you’re thinking of becoming the owner of a franchise-type of business, there’s something you need to know about franchising…and you may not like it.

Now, what I’m about to share probably won’t be a game-changer if you’re really bent on buying a franchise, but you need to have as much factual information on this business model before you invest in one.

Here goes:

You’re going to have certain restrictions placed on you.

And according to “Buying a Franchise: A Consumer Guide” published by The Federal Trade Commission, “These kinds of restrictions may limit your ability to exercise your own business judgment in operating your outlet. That said, if the franchisor does not limit the territory where each franchisee can sell, the franchisor and other franchisees may compete with you for the same customers, either by establishing their own outlets, or by selling to customers in your area through the Internet, catalogs, telemarketing, and the like.”

Please read it again.

Surprises Not Included

One of the best parts of franchising today has to do with transparency.

Years ago, you would have to drive, walk or ride your bicycle down to your local library, and spend hours just searching for information on franchising. I’m not even talking about information on specific franchise opportunities…just basic information on a franchise business works!

Things are vastly different now, obviously. Within minutes, you can get information on the franchise business model* just by using the search engine of your choice. There are even vast amounts of information readily available about the Franchise Disclosure Document (FDD).

As a matter of fact, Item #8 (there are 23 items contained in the FDD) deals with the subject of this guest blog post: restrictions.

Item #8

Restrictions on Sources of Products and Services

This section tells whether the franchisor limits:

1. Suppliers from whom you may purchase goods

2. Goods or services you may offer for sale

3. Where you can sell goods or services

4. Use of the internet to sell goods or services to customers in and out of your territory and the right of the franchisor (or other franchisees) to use the Internet to solicit customers or to sell in your territory

According to the FTC, these kinds of restrictions may limit your ability to exercise your own business judgment in operating your outlet. That said, if the franchisor does not limit the territory* where each franchisee can sell, the franchisor and other franchisees may compete with you for the same customers, either by establishing their own outlets, or by selling to customers in your area through the Internet, catalogs, telemarketing and the like.

The FDD contains very specific things that have to do with the four items listed above. Make sure you understand what, where and how you can and cannot sell your products and services.

If you engage the services of a competent franchise attorney like I’ve been suggesting over the years, you’ll be able to have a complete understanding of any restrictions that will be placed on you as you move towards becoming your own boss.

* Non-US Government links

New Year, New Benefits

BarbaraWeltman — Wed, 30 Jan 2013 12:43:42 +0000

You love your staff and want to show it by giving them more in a tangible way. Increasing their pay may not be the best strategy for you or your employees. Added pay is taxable to employees, so they net less (how much less depends on their tax bracket). And added pay has additional costs to you in the form of payroll taxes. What to do? Think about giving them fringe benefits.

Overview

You’re not obligated to provide any benefit (starting in 2014, employers with more than 50 full-time employees will have to provide health coverage or pay a penalty for not doing so). If you choose to give fringe benefits, it’s a win-win for you and your employees:

You reward your staff without incurring additional employment taxes, such as the employer’s share of FICA (covering Social Security and Medicare taxes) and state unemployment insurance. Some benefits won’t even cost you a penny because you merely arrange for workers to buy them on their own with favorable tax results to them (explained later).
Your employees get valued benefits that do not increase their taxable pay. If they’d had to buy these benefits on their own, they would have had to earn enough, after tax, to cover the cost. For example, say you offer dependent care assistance of $2,500 annually for all employees. If an employee in the 25% tax bracket had to pay this cost on her own, she should have had to earn about $3,350 more in wages to cover this cost.

If you provide any fringe benefits, you must do so on a nondiscriminatory basis (with few exceptions). This means that benefits cannot go merely to owners and highly-paid employees; they must be available to rank-and-file employees as well.

Tailor your benefits plans to the needs of your staff and to your pocketbook. Remember that health coverage and retirement plans are the top two most-valued employee benefits.

Transportation fringe benefit

Employees know that their commuting expenses are not deductible, regardless of the length of the commute or how much it costs. However, you can pay for certain transportation fringe benefits that will be tax free to employees. For 2013, transportation fringe benefits are:

Free parking, transit passes and vanpooling up to $245 per month
Bicycle assistance (to maintain and store the bicycle) up to $20 per month

Alternative: Instead of paying these benefits, you can arrange for employees to pay for them on their own on a pre-tax basis (i.e., the portion of their wages used to pay for the benefits don’t count as taxable income). Your cost: only minimal administrative costs. For more about this, look at *TransitChek or the websites of other companies that arrange for transportation fringe benefits.

Child-related benefits

You can help your staff with family obligations in a tangible way by paying some child-related costs:

Dependent care assistance. You can pay up to $5,000 of assistance for each employee each year; this amount is tax free. Alternatively, you can enable workers to pay for their dependent care needs on a pre-tax basis by setting up a dependent care flexible spending account (FSA). The funds in this FSA cannot be combined with funds in a medical FSA.
Adoption assistance. You can pay up to $12,970 for adoption assistance in 2013 (the limit increases annually for inflation).

Small employers may not be able to offer these benefits and enjoy them personally. The law prevents “highly-compensated employees” (e.g., owners) from excluding company-paid benefits if the plan skews benefits toward them. In other words, the plan must be nondiscriminatory for all workers.

Cafeteria plan

Workers usually prefer to have a menu of benefits from which they can choose. A cafeteria plan lets employees choose between cash (or taxable benefits) and tax-free benefits; they are not taxed on the tax-free benefits merely because they could have opted for cash. Some of the benefits you can offer under the plan include:

Adoption assistance
Athletic facilities
De mimimis (minimal) benefits
Education assistance
Employee discounts
Employer-provided cell phones
Health benefits
Meals
Moving expense reimbursements
No-additional-cost services
Transportation commuting
Working condition fringe benefits

As a small employer (no more than 100 employees), you can opt to use a simple cafeteria plan. A simple cafeteria plan is presumed to be nondiscriminatory. You must make minimum contributions (e.g., at least 2% of worker’s pay) to workers in the plan who are not highly-compensated employees; all employees can enjoy benefits under the plan. Your contributions to the plan are tax deductible.

You can find more about cafeteria plans in IRS Publication 15-B, Employer’s Tax Guide to Fringe Benefits. (The 2013 version is not yet out but should be shortly.)

Conclusion

Whether you offer benefits, what they are, and how much you pay depends on your company’s financial situation. Obviously, you can only do what you can afford to do, no matter how generous you may want to be. Always discuss your benefits plans with a knowledgeable tax advisor.

*denotes non-government website

3 Ways Business Planning is Like Dribbling a Ball

Tim Berry — Fri, 25 Jan 2013 00:20:28 +0000

Think of basketball or soccer. In both of these popular sports, dribbling is what the players do to move the ball in the right direction. It's not the point of the game, it doesn't score baskets or goals, but it's an important skill, right? I think of dribbling as a great analogy for business planning. And here are some reasons why—and some lessons I suggest we can take from that.

Dribbling is a means to an end—not the goal. Planning is like that too. It's about results, running a business—not at all about the plan itself. Good planning is measured by the decisions it causes. It's about managing, allocating resources and accountability. I’ve written this in several places: “You measure a business plan by the decisions it causes.” And this: “Good business planning is nine parts execution for every one part strategy.”
Think of the moment when the player gets the ball in the wrong end of the court or field. That’s either a defensive rebound in basketball or a missed shot on goal in soccer. The tall player gets the basketball and gives it to the one who normally dribbles up court. Or the goalie gets the ball and gives it to a defender. At that moment, in a well-coached team: 1) there is a plan in place and 2) the player knows the plan but is completely empowered to change the plan instantly depending on how the play develops. Business planning done right is very much like that. The existence of a plan—take the ball up the side, pass to the center—helps the team know what ought to happen. But changes—the opponents do something unexpected—are also expected. The game plan doesn’t lock the players in to doing the wrong thing or not responding to developments. It helps them make the instant choices, changing the plan correctly...and when they do, the other players can guess the next step better because of the plan.
Dribbling involves simultaneously looking up, at the field, and developments going on; and down, at the ball, hands, and feet, to manage the details. Proper business planning, in very much the same way, requires looking up at the figurative horizon—threats, opportunities, competition, market developments, etc.—and down at the details: tasks, deadlines, budgets, accountability, and of course cash flow and plan vs. actual.

I’ve always liked this analogy because it dispels the myth that having a plan reduces flexibility to react to developments. Planning isn’t voided by change; on the contrary, having a plan makes reactions easier. There is no virtue in following a plan just because it’s the plan. Proper planning means regular review and revision.

Balancing Work and Personal Life with Your Business

bridgetwpollack — Tue, 22 Jan 2013 22:08:43 +0000

January is the month when we promise ourselves we will change for the better…we say we will eat better, work out more and spend more time with our loved ones. And by February, we find ourselves right back into our old habits.

If you’re really lucky, the holidays may have provided a mental and physical break and rejuvenated your fervor for your business. Hopefully, you were able to spend time with family and friends and were reminded about what you work so hard for, and proved that time away from your work can do your work good.

But as an owner who has dedicated all you have to your business, it can be difficult to know how to juggle work and play. In the 2012 U.S. Bank Small Business Annual Survey, small business owners reported that “more owners in 2012 said their business is their life and their life is their business–up from 34 percent in 2011 to 45 percent in 2012.”

As with many things, the most important step in achieving work-life balance is to simply be aware of it. Know what your work and personal goals are and regularly take stock of where they stand and what needs to change.

It’s helpful to think of your life as a business, too. Its profits may not be measured in any currency and its benchmarks may not be defined by tangible assets, but it too has goals to achieve and plans to help you get there. Just like a business, to sustain yourself and your personal life over a long period of time, it needs to be analyzed, planned and dedicated time. Only once this “business” is made sustainable and profitable can it properly bolster your actual business.

As an entrepreneur who has laser-focused vision on the ultimate bottom line, it can be easy to forget about managing the personal aspects of your life. Similarly, if you have employees, you may slip into the role of the boss who demands that same 150% dedication from their employees as well. While they are most likely passionate, dedicated and hard workers, they need their own work-life balance as well. Try to make sure they have adequate time during the year to take their own leave and address their own personal goals and needs. The Golden Rule certainly applies: Treat your employees how you wish your boss had treated you.

The question then becomes, “What is adequate time to provide to myself and my employees?” and “How do I let go of some of the business aspects to focus on my own life?” These questions can have varying answers depending upon your personality, needs and the business that you are in. This is where it is helpful to have a mentor—someone who understands your business, but is removed from the situation so that they can see different aspects from you, the owner, who is engrained in all of the components.

Take the beginning of this new year as an opportunity to make a plan for your small business, your personal life and how you will balance the two throughout the next 12 months. Work with a mentor from SCORE or the Small Business Development Centers to evaluate this plan. Don’t beat yourself up if you happen to show up late for dinner or miss that deadline in lieu of a soccer game. If you haven’t already learned this in your small business endeavors you certainly will:

“When you aim for perfection, you discover it's a moving target.” -George Fisher

5 Ways to Make the Most of Marketing With Business Cards

Rieva Lesonsky — Wed, 16 Jan 2013 16:42:28 +0000

Business cards? Didn't those go out with the dinosaurs? Actually, no. In fact, according to an Ipsos poll conducted last fall, business cards are still one of the most effective marketing methods available to small business owners. Surprisingly, 60 percent of the small business owners surveyed say they currently give out more business cards than they did five years ago.

How can you make your business cards even more effective?

1. Make them memorable. Use design to make your card stand out from the pack. You can design your own business cards using templates at a host of websites. However, for not much more money, you can enlist a graphic designer to create a template for you. Ask around for a local designer or visit Elance.com, 99Designs.com or Odesk.com to find graphic designers.

2. Focus on function. Don’t get carried away in your desire to make a card stand out. I still remember a metal business card someone gave me back in the 1980s. Why? Because I tossed it in my purse and one of the sharp corners tore a hole in the lining. Business cards in odd shapes, sizes or materials are often touted as a way to be memorable, but in reality, these cards often get tossed since they may be bulky or don’t fit into card-holders or files easily. Good-quality card stock and good design will make your cards stand out without resorting to gimmicks.

3. Keep it simple. The purpose of a business card is to get someone to contact you, so focus on the information they’ll need to do so. While in the past you may have wanted to include your business name, address, fax number, etc., today business cards allow for a lot more customization. Depending on how you want to be contacted, you may simply want to have your name and title, your business name, your email address, your URL and your cell number on the front of the card. (That’s assuming, of course, that when they go to your URL they can find all the other information, like address, landline phone number and fax.) Are you a Twitter maniac? Then put your Twitter handle on there, too. If you want to include lots of other information, you can put it on the back.

4. Share them. You’ve got your cards; now give them out—everywhere. The average U.S. small business owner distributes 40 business cards a month, the Ipsos survey found. And three in 10 say they “always” give out their cards when they meet someone new in either a business or personal setting. Carry plenty of cards with you at all times. Whether you’re in the gym locker room, in line at the movies or at a cocktail party, you never know where you’ll meet a prospect or potential partner.

You can also:

· Include cards in correspondence

· Include them with invoices or bills

· Include them in packaging when you ship a product

· Give someone two cards: one for them to keep and one for them to pass on as a referral. (Ask first. Don’t just assume they’re willing to pass your cards out for you.)

· Put cards in public places where your clients are likely to visit or ask if you can leave them at other (noncompeting) businesses

5. Organize them. The cards you collect are as important as the ones you give out—75 percent of small business owners keep contacts’ cards at their desks for easy reference. While I myself still have a Rolodex, you can speed things up by using tools such as the Neat Desk Scanner or CardMunch to scan business card information or import it into your digital contact list quickly and easily.

Why Your Business Needs to Get a DUNs Number

BusinessCredit — Thu, 10 Jan 2013 16:55:44 +0000

Did you know that a DUNS number is the most widely used number for identifying companies in the United States?

Did you also know that suppliers and creditors alike pull a Dun and Bradstreet (D&B) credit check on your business when you apply for credit?

Part of establishing a creditworthy company includes establishing positive credit ratings with major business credit reporting agencies such as D&B. If you are serious about establishing credit for your business, then the first thing to do is get listed in D&B’s database and set up your company’s credit file.

When you apply for a DUNs Number with D&B, the Data Universal Numbering System issues a nine-digit number that is unique to your company. This DUNs number is used to create your business credit file, similar to how your social security number is used to identify your personal credit reports.

To obtain your DUNs number, first enter your legal business name, city, and state in the search box on the D&B website and click on the search tab. This will verify if your company is already listed with D&B and has been issued a DUNS number.

You’ll see a list of possible matches, but click on the tab only if you believe there is a match to your company name. Doing so requires that you verify specific information about your business.

Once you gain authorization, D&B provides you access to your files via iUpdate, where you can review, update, correct and add company information. If your company does not show up in the search results, then most likely you do not have a DUNs Number.

The next step is to apply for one.

It is important to note that once you apply for a DUNS Number at no charge, your file will be created. But it will be considered an incomplete file (marketing file) if you have no trade references reporting. If this is the case, you can either add trade references to your file by enrolling in a monitoring program or you can apply for credit and wait for a supplier to report your company’s payment activity.

Remember, once you obtain your DUNS Number, the next step is to start establishing business credit by adding positive trade references to your file. This only happens when you start making purchases with creditors that report payment activity.

With more than 500,000 suppliers in the U.S. and less than 6,000 that actually report to the business, credit agencies don’t get caught up in the mistake of applying for credit with non-reporting creditors when your chief aim is to build your company’s credit file.

Ultimately, a creditworthy profile will help creditors, lenders and suppliers assess the creditworthiness of your company when you apply for credit.

Setting 10% Goals for Success

smallbiztrends — Tue, 08 Jan 2013 23:28:35 +0000

Funny, isn’t it, how the grass tends to look greener from the other side. It’s the same in business as well as in personal affairs.

If I look around, I can spot five companies in five minutes that “seem” to be doing better than mine. They appear to have accomplished more, in less time, and seem to be doing better than my company.

The fact is, that may or may not be true. Often things just LOOK greener.

But there is one good thing that tends to come out of “grass-is-greener” musing: it inspires me to set goals to improve my business.

One technique that we have used with great success is setting 10% goals. Think of it this way if you’re a football fan: instead of going for a touchdown pass on every play (and failing miserably because there’s no way you can make a touchdown every time), you instead go for a series of first downs. If you are successful at those smaller first down attempts, they add up to many yards over a series of plays. When you’ve advance the ball 70 yards down field, THEN you attempt the touchdown pass.

By attempting first downs, your chances of positioning the team to make a touchdown are much better. Compare that strategy to always attempting 70-yard passes that have a high chance of failing and stopping your advance cold in one, two or three plays.

Translated to business, the idea is to set a goal to improve something by 10% ONLY. Don’t attempt to improve something by 50% or 100% in one fell swoop—it probably will be too big to bite off and chew. By being overly ambitious, you just set up yourself, your team and your company for failure.

A 10% improvement is often doable. A small improvement such as 10% each month over the prior month can add up to more than 200% improvement in a year’s time. And because you are attempting something unintimidating and achievable, you and your team feel successful each month because you’re able to meet your goal and continue your progress.

Here are some ideas for 10% goals you can set in your business to improve sales or profitability:

Increase sales prospecting calls per rep by 10%
Improve throughput by 10% through adopting new software or a new app
Improve your quote-to-close sales cycle by 10%
Increase renewals of existing customers by 10%
Cut company travel expenses by 10%
Decrease utility expenses by 10%
Increase your newsletter subscribers by 10% by offering free downloads and other incentives
Cut server expenses 10% by moving to cloud computing
Increase leads captured off your website by 10%
Reduce the time for collecting outstanding receivables by 10%
Increase traffic to your website by increasing the number of social media shares/posts you make by 10%
Develop a new product line that grows 10% per month
If you have credit card balances outstanding, cut interest expense by paying down your balances by at least 10%

The list goes on — the above examples are just designed to get you started. Think especially about how to use technology to achieve goals. Technology is your friend in this kind of goal setting. Accounting software, for instance, helps you run reports to compare one period against another. Dashboards in online apps that measure your performance using the app can also help you measure progress. Even a good Excel spreadsheet can help save hours of time to measure progress, and demonstrate how much the team has achieved each period.

As with all goals, they must be specific as to time and other details, and measurable. So whether your goal is to make an improvement of 10% weekly, monthly or quarterly—the point is to set a specific time frame. Then find a way measure progress over that period.

Finally, don’t get hung up on the number 10. Ten percent is really a metaphor for a goal being doable. If 10% is overly ambitious in the context of your business or a particular area, then make it 5% or 3% or even 1%. The point is to set goals that are achievable in a short time frame. Keep building on those goals consistently each period until they add up to big gains at the end of the year.