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MaTCH competition aims to ignite workforce development

By Chris Pilkerton, Acting SBA Administator
Published: May 28, 2019 Updated: May 28, 2019

Melissa Wegman’s family-owned furniture manufacturing company has thrived for half a century, but she says she’s worried about its future growth. The Cincinnati-based company is struggling to find workers with the right skills to do the job. And research shows she’s not alone. A recent NFIB survey found 24 percent of small business owners say finding qualified workers is their single most important problem; 86 percent of those trying to hire workers had few or no qualified applicants.

The U.S. Small Business Administration is launching a new competition that aims to solve this problem. The Makerspace Training, Collaboration and Hiring (MaTCH) Pilot Competition challenges organizations to create or expand job and skills training programs in existing makerspaces. The SBA will award up to $1 million to fund the winning proposals.

Makerspaces are collaborative places where people work to solve problems by sharing ideas and experiences and developing new skills. Many of them offer tools like 3D printers, laser cutters, soldering irons and sewing machines for community use. We at the SBA believe these makerspaces have the resources and ingenuity necessary to solve the problem small businesses face. They are uniquely positioned to boost workforce development by fostering vocational education, apprenticeships and entrepreneurship. And we hope this competition will both empower creative thinking and strengthen the link between these spaces and their local communities. The ultimate goal – expanded job skills will offer working families a pathway to the middle class, and a skilled workforce will drive economic growth that benefits us all.

Through this MaTCH Pilot Competition, we hope participants will be able to be placed immediately in positions with local employers that need skilled workers. Some of the competitors may even offer industry or trade certifications.

To enter the MaTCH Pilot Competition, applicants must submit a business plan that details their qualifications, experience and resources; the proposed training curriculum; the nature and length of the training/certification program; and the number of trainees that will be accommodated. Proposals must be submitted by July 8, and winners will be announced on August 6. The entry form, rules and requirements are available online at https://www.sba.gov/match.

America was built on innovation and creativity, with an eye toward solving the problems we face. The problem small business owners like Melissa Wegman are having demands a collaborative solution – and the SBA is confident this MaTCH competition will spark some bright ideas.

About the Author:

Chris Pilkerton

Acting SBA Administator

Chris Pilkerton serves as the Acting Administrator and General Counsel of the U.S. Small Business Administration.

How to do a Practical Lean Business Plan in Four Easy Steps

By Tim Berry, Guest Blogger
Published: May 10, 2019

One of the most common reasons for business owners not getting the benefit of business planning is putting off doing a plan because it seems too hard. People still think of a business plan as a big formal document, hard to do, and — sadly — not worth the effort. But what they miss with that attitude is the lean planning that could steer their business better.

Here's how to do a lean business plan in four easy steps:

Step One: Strategy is Focus

You can summarize business strategy with a few key points: the problem you solve, your unique solution to that problem, your choice of target market, and your unique business identity.

Don’t worry about big text, editing, or the document. Just write down your key strategy choices. Make it as simple as a bulleted list. Consider it for your use only, not an academic exercise; and not the big formal business plan you heard about years ago. If you know your business, then you know your strategy. You write it down as a reminder, to help prioritize.

Step Two: Tactics to Match Strategy

Strategy needs tactics for execution. Tactics are what you do to execute strategy: the product or service, the marketing, pricing, distribution, personnel, financing, and so on.

Here too, as with strategy, your lean plan doesn’t mean long texts with a lot of editing. It’s as simple as writing down, usually in a list of bullet points, the most important elements.

You are looking for strategic alignment. That means tactics match strategy. That’s hard to define but easy to see when it works. You are linking what you mean to accomplish(goals) with the key action steps for each of those goals. Does your pricing match your product-market mix? Do the distribution tactics match the product and market?

For example, if your restaurant is targeting high disposable income diners for fine dining, you don’t have discount pricing, half-off coupons, or a kids’ playground, but you may have reservation-only meal hours, valet parking, and glamorous dinning room décor.

Step Three: Specifics on What, When, and How Much

I call these milestones: smaller action items that you can put on the calendar to measure progress as you make it. These normally include tasks, deadlines, budgets, and responsibility assignments. Think of milestones as things like reaching the first 1,000 customers, launching the new website, hiring the new sales manager, opening the branch store, landing the exclusive representation contract.

The underlying assumption is that teams and even individual business owners work better when they see tangible goals to work towards. Make the next milestone.

Furthermore, for most people, it’s easier to imagine the progress towards long-term goals of a business in a series of steps. What’s the next step? And the one after that? What steps can you identify for product or service? For marketing? For administration.

Make this a simple, practical list.

Step Four: Essential Numbers

Hard as it might be to forecast essential business numbers, it’s still easier than trying to run a business without a forecast. You don’t have to be CPA or MBA to be able to make educated guesses about future sales, costs, expenses, and cash flow.

We’ve posted detailed help for your essential numbers in previous posts on this same blog.

Step Forever: Regular Review and Revise

The point of the business plan, for real business in the real world, is not the plan itself but the planning process. The goal of planning is to steer a business better. For that, you have to keep your lean plan fresh with monthly review and revision as necessary. If business were navigation, then the plan sets the destination and route, but you still need a GPS with real-time traffic and weather to decide when to change the planned route. The GPS factor is the regular review and revision of the plan, to keep it fresh.

About the Author:

Tim Berry
Tim Berry

Guest Blogger

Founder and Chairman of Palo Alto Software and bplans.com, on twitter as Timberry, blogging at timberry.bplans.com. His collected posts are at blog.timberry.com. Stanford MBA. Married 46 years, father of 5. Author of business plan software Business Plan Pro and www.liveplan.com and books including his latest, 'Lean Business Planning,' 2015, Motivational Press. Contents of that book are available for web browsing free at leanplan.com .

5 Key Questions to Ask Yourself if You Plan to Start a Business

By Marco Carbajo, Guest Blogger
Published: October 2, 2018

Starting a business takes planning, making important financial decisions, and completing a series of legal activities. You will need to set goals, put plans into action, assess your progress, make necessary adjustments and grow your business.

There are plenty of things that every business needs to do to get off the ground. So, here are five key questions to ask yourself as you plan to start a business.

1) Do I have what it takes to make it as a business owner?

Before you start a business, you should be able to answer a few very important questions. What product or service are you offering? What makes your product or service different from everyone else? Who is your ideal customer? How does your product benefit them? Answering these key questions will help define your business identity.

Once you identify your business identity it’s important to remember, success in business requires passion, a lot of hard work, staying power and drive. According to Elizabeth Wilson of Entrepreneur Magazine, while some 40 million businesses are started each year, only 350,000 break out of the pack and begin growing and making money.

2) What is my niche and who is my target customer?

Before you start a business it’s key to know who your paying customer is going to be. You may have a great product idea that people need, but that is not enough to break through. You need to solve a problem that people want a solution for, and more importantly are willing to pay for.

Don’t get trapped into the mindset that if you don’t offer everything, you’ll miss out on customers. Offering everything doesn’t mean that every person will buy your products or services.

Find your niche and identify your target market. A niche is a specialized product or service you offer to your ideal customer. Your target market is the ideal client looking for what you have to offer.

3) Who will be on my team to help with my new business?

Starting and growing a business requires more than going at it alone. It takes a team to build a successful business and it’s just as important as developing your product. Even if you plan to be a sole proprietor, you can benefit incredibly from creating an outside support team to keep you focused and on track.

You’ll also need to pull together a team of people as you set up and launch your business. These will be people that are needed to set up and run a business such as a lawyer, accountant, sales rep, web developer, marketing agency, etc.

Each of these people on your team brings something different to the table, it’s essential that you listen to their advice on what needs to be done. Having a team you can trust is crucial to the success of your business. Getting the right advice can save you from making costly mistakes now and in the future.

4) What amount of funding do I need to start?

Starting a new business doesn’t have to require a great deal of funding if you decide to bootstrap. However, it will involve some initial investment to cover startup costs.  The key here is to work through your options and determine how much business funding you will need to cover not only your startup costs but also ongoing expenses before you are generating a profit.

Once you have an estimate in mind, there are a number of ways you can fund your startup, including business credit cards, lines of credit, vendor credit, a business loan, etc. You may find that a combination of these sources listed may work best.

5) What business structure should I choose?

The business entity you select will impact various factors from your business name, to your liability, to how you file your taxes. It’s essential to choose the right business structure when starting a business. Once you choose your business structure, you’ll also need to get a tax identification number and file for the necessary licenses and permits.

For additional information, be sure to check out the SBA’s business guide which outlines ten steps to start your business.

About the Author:

Marco Carbajo
Marco Carbajo

Guest Blogger

Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. He is a business credit blogger for Dun and Bradstreet Credibility Corp, the SBA.gov Community, About.com and All Business.com. His articles and blog; Business Credit Blogger.com, have been featured in 'Fox Small Business','American Express Small Business', 'Business Week', 'The Washington Post', 'The New York Times', 'The San Francisco Tribune',‘Alltop’, and ‘Entrepreneur Connect’.

How Much Energy Do You Need to Own and Operate a Franchise?

By FranchiseKing, Guest Blogger
Published: April 26, 2018

There’s hard work, and there’s really hard work. Owning and operating a franchise business falls under “really hard work.” Are you prepared for it?

 

Owning a Franchise

If it was so easy, everyone would do it.” That’s a true statement, especially when it comes to being the active owner of a franchise business. Most franchises require their owners to be active — to be working in the business. But some, like these, don’t. In this post, I’m going to focus on active, full-time franchise owners.

 

Leadership

When you own and operate a franchise business, you’re going to put in very long hours — especially at first. That’s because you need to oversee many aspects of your business, including:

  • Interviewing and hiring employees
  • Planning your grand opening
  • Ordering inventory/supplies
  • Setting up the technology
  • Doing “dry-runs” with employees before you open

 

If you own a franchise that requires employees, they’ll need leadership. Initially, that leadership will come from you. You’ll set the tone. You’ll let your employees know what you expect from them, and what they should expect from you, as the owner.

After some time, you may be able to delegate some of the management/leadership aspects of the business to an employee. Doing so can free you up to other thingshandle other business matters, like business-building.   

 

The Hours

For the most part, expect to put in 10-12 hours a day, six to seven days a week, depending on the type of business you own. For example, if you own a food franchise, 12 hours a day is pretty much the norm. And most of those hours are going to be spent on your feet, since food-service work is very physical at its core.

Similarly, retail franchise ownership requires lots of 12-hour days, with most of those hours being in an upright, standing position.

On the other hand, if you own a B2B franchise, although there is physical work involved, you’re probably not going to be working 12 hours a day. Plus, since most B2B franchise businesses tend to only be open Monday through Friday, your total hours will be less than a food franchise or a retail franchise business.

Tip: As you search for a franchise to own, ask the franchisors you contact about the hours you’ll have to work in order to be a successful owner.

 

On Energy

Working long hours requires you to have lots of energy. But owning and operating a successful franchise business requires more than just physical energy. You’ll also need:

1. Mental energy

You’re going to need a lot of mental energy to get you through the daily twists and turns all franchisees experience. Things like equipment breakdowns, employee no-shows, and technology problems — to name just a few — can and do happen. You’ll need to handle them quickly and professionally.

2. Positive energy

To be a successful franchisee, you need to be positive. You need to believe in your business, and the products/services you offer. You need to believe in your talents, and in the talents of your team.

Because when you are positive, your employees and your customers will feel the positive energy you’re putting out. The result: Your employees will be more cooperative and more energetic, and your customers will gladly hand over some of their money.

The bottom line: If you have the physical and mental energy needed to run a franchise business, and you can tap into your leadership abilities, the sky is the limit.

About the Author:

FranchiseKing
Joel Libava

Guest Blogger

The Franchise King®, Joel Libava, is the author of Become a Franchise Owner! and recently launched Franchise Business University.

Could a Semi-Absentee Franchise Opportunity Be Right For You?

By FranchiseKing, Guest Blogger
Published: March 29, 2018 Updated: March 29, 2018

Wouldn’t it be great if you could literally do two things at once?

Well you can, through franchising. I’ll explain.

 

A Typical Franchise Opportunity

Today’s typical franchise opportunity requires franchisees to be actively involved in running the business.

For example, if you owned a retail franchise business, you’d be involved in things like:

  • Ordering products
  • Inventory
  • Financials
  • Sales
  • Training
  • Hiring

And most of those duties require your presence on a daily basis.

In other words, you’d be working a lot of hours.

As a matter of fact, most franchise businesses need to have their owners on-site most of the time. But you knew that, right?

Be that as it may, what if there was a way to own a franchise, and not have to be there all of the time?

Keep reading.

 

An Unconventional Franchise Opportunity

I’m going to share a franchise opportunity that:

A. Doesn’t require long hours

B. Allows you to keep your job

The opportunity I’m referring to is a semi-absentee franchise.

Specifically, a franchise business that’s setup to have a manager in place-from day one. As opposed to a franchise business that requires the franchisee to operate the business from day-one, but who can eventually add a manager to assist her in the daily operation of the business.  

But here’s the deal: there aren’t a huge number of franchise opportunities available that are truly semi-absentee. 

 

An Example Of A Semi-Absentee Franchise

 Fitness franchises such as 24 Hour Fitness are attractive to prospective franchise owners, because in most cases, you can open one of these fitness franchises without having to leave your job.

The reason you’re able to keep a full-time job when you own a fitness franchise comes from the ability for franchisees to hire part-time fitness coaches to help oversee things, and to signup new members.

In this case, the ultimate goal as a franchisee is to own several of them, and leave your place of employment when enough income’s coming in. (And buy even more units if you can.)

 

Other Semi-Absentee Franchises

Here are several other franchise types that are usually semi-absentee.

  • Frozen Yogurt/Ice Cream franchises
  • Hair Salon franchises
  • Tanning salon franchises
  • Vending franchises
  • Car Wash franchises

 

Qualifications Needed

As attractive as semi-absentee franchise ownership sounds, it’s not for everyone.

For example, you’ll need to have above-average financial resources.

That’s because multi-unit franchise ownership is almost always required with these franchise opportunities. For example, if you commit to 3 franchise units, your total outlay could be $500,000 or more. (Over time.)

Secondly, you’ll need to have a good job. As in, well paying.

That way, you’ll be able to meet your personal obligations as your new business ramps up. Plus, you may find it easier to obtain loans for your future locations.

Going forward, a trend I predict* will be that more and more franchisors will start offering semi-absentee ownership options. Especially if our unemployment numbers remain low, as people won’t want to leave their jobs-but some of them will still be interested in starting businesses. 

*Non-U.S. Government link

About the Author:

FranchiseKing
Joel Libava

Guest Blogger

The Franchise King®, Joel Libava, is the author of Become a Franchise Owner! and recently launched Franchise Business University.

8 Business Plan Myths That Can Hurt Your Business

By Tim Berry, Guest Blogger
Published: March 2, 2018 Updated: March 2, 2018

The need for good business planning is as strong as ever, and the potential benefits are as important as ever. Every business owner ought to have a business plan. But the best strategies for business planning are different than they used to be.

With that in mind, I’ve identified 8 pervasive myths that stand between you, the business owner, and the planning your business ought to have.

1. A business plan has to be long

Not necessarily so. A business plan can take whatever form is most useful, even if that’s just a few lists and tables.

2. A business plan is hard to make

It doesn’t have to be. List your key strategy points and key tactics, and a few important major milestones (like deadlines, tasks, the new launch or new website, and necessary hires). Include projected sales, costs, expenses, and cash flow. Voila! You have a business plan.

3. Nobody creates business plans anymore

Well-run businesses use business planning the right way. They keep a simple, lean plan up-to-date and refreshed. The review and revise it monthly. In straw polls I’ve taken for years at management workshops, the best 20% or 30% of the companies represented have a management process that includes a lean business plan as well as regular reviews and revisions.
 
Smart startups use basic business planning to help them see starting costs, projected early sales and spending, cash flow, and key strategy points and milestones before they launch. Then, they review these monthly.

4. Business plans are for only startups

True, well-run startups generally use business planning to help figure out which steps they need to take, and which resources they need. But that doesn’t mean mature businesses can’t use business planning to constantly set milestones, strategy reminders, and forecasts. Mature businesses keep a business plan up-to-date, and review and refresh it often. The more a business grows, the more it can benefit from good business planning.

5. You can’t plan because change comes too fast

In the real world, a good business plan manages change. It isn’t voided by change. You keep the plan current by making revisions as real events unfold.
 
It’s like dribbling in basketball: if you plan to go a certain direction, and the other team blocks you, then you go a different way. Having a plan means that you’ll have the information you need to make quicker, easier, and more natural revisions.  

6. Business plans require market research

I read and review lots of business plans from mature businesses that don’t include fancy market research. Business owners have to know their market, and taking a step back to review your market is a good idea. But with good planning process in a business, you can stay on top of your market. You don’t need to include market research in every version of your business plan.
 
Only in special cases will you need market research to prove your market to outsiders. For example, startups looking for investment, or businesses applying for loans, might need market research. Mature businesses know their market and plan without the research requirement.

7. Investors don’t read business plans

I was in an angel investment group for eight years. We didn’t read business plans for all the proposals that came in. We rejected many on the basis of summaries alone. For those that interested us, we invited them to present their pitch decks. From there, we narrowed the list down further.
 
For those that remained, the business plan was a vital part of due diligence. And for all of them, they should have had their bare-bones business plans made before they wrote their summaries and pitch decks. Without the business plan, the pitch and the summary are like movies made without scripts. Ultimately, seeking investors without a plan doesn’t work.

8. Nobody needs a business plan

Does every business need a plan, strictly speaking? No. But every business would benefit from good business planning.
 
People, even experts, still say nobody needs a business plan, but only because they are locked into the decades-old mentality of the big business plan document. If we redefine the business plan the way it should be, as a flexible record of key strategy points, tactics, milestones, and essential numbers, then all those experts would agree with me – that every business deserves a business plan.

About the Author:

Tim Berry
Tim Berry

Guest Blogger

Founder and Chairman of Palo Alto Software and bplans.com, on twitter as Timberry, blogging at timberry.bplans.com. His collected posts are at blog.timberry.com. Stanford MBA. Married 46 years, father of 5. Author of business plan software Business Plan Pro and www.liveplan.com and books including his latest, 'Lean Business Planning,' 2015, Motivational Press. Contents of that book are available for web browsing free at leanplan.com .

5 Things To Do Before You Search For A Franchise

By FranchiseKing, Guest Blogger
Published: January 18, 2018

In this post, I’m going to teach you 5 things you need to do before you start searching for a franchise to buy.

In this case, preparation is key.

In other words, the time to get all your ducks in a row is before you start your search...not during your search.

5 Things To Do Before You Start Your Search

1. Start reading.

I want you to read books about:

  • Starting a business
  • Entrepreneurship
  • Franchising
  • Business plans

And if you really want to get a leg up, read an accounting book.

Reading books on the above topics will help you get a better understanding of business, and what it’s going to take to succeed.  

The more that you read, the more things you will know. The more that you learn, the more places you’ll go.”  – Dr. Seuss

 

2. Financials

Before you take the time needed to search for a franchise to buy, it’s important to see where you stand, financially.

The best way to do it is by putting together a net worth statement.

Generally speaking, the most time-consuming part of doing a net worth statement is gathering all the information you need.

You’ll need your mortgage loan and credit card statements, information on all of your investments, and more. In a nutshell, you’ll need to gather everything that lists all of your assets and all of your liabilities.

Once you have everything, you can use a calculator* to come up with your net worth. Here’s an article* if you need more details on what numbers you will need. (Make sure you save a copy and print it out after it’s calculated.) 

3. Learn about small business loans

If you’re like most of the people who are considering franchise business ownership, you’ll need a small business loan for the lion’s share of your startup capital needs.

That’s why it’s crucial to learn all you can about the types of loans that are currently available. And the information you need is only one-click away.

Just go to this U.S. Small Business Administration webpage for comprehensive loan information, including SBA-guaranteed loans, eligibility requirements, and a list of lenders you can contact. 

 

4. Share your interest in franchising with your family

Transitioning from employee to franchise owner is a big deal.

That’s why it’s essential to discuss what you’re thinking of doing with the people who will be affected the most; your family.

And when you have the discussion, don’t hold back. Tell them why you want to be your own boss. Tell them how you’re going to get the money. Tell them how careful you’re going to be-and that you promise to do great research.

In the long run, as long as you’re upfront with them, and communicate with them during the entire process, chances are they’ll support your decision.

 

5. Disconnect

The last thing to do, before you start your search for a franchise opportunity that may turn out to be a good fit, is disconnect.

Specifically, take an internet-social media break. Spend a few days with you.

Refrain from answering emails, logging into your social media networks, or reading articles about franchising-or business. Instead, spend some time away from your Smartphone. Maybe you can spend time outdoors, or at least somewhere that will provide a change of scenery. But, it has to be distraction-free.

Doing what I just recommended will force you to take a hard look at what you’re thinking of doing.

To sum things up, deciding to become the owner of a franchise business is a big decision. The preparation you do before you begin your franchise search really matters. That includes talking about your idea with your family, and spending a period of distraction-free time alone. Combined, all these action items will go a long way in setting yourself up for success as the owner of a franchise. 

*Non-U.S. Government link

About the Author:

FranchiseKing
Joel Libava

Guest Blogger

The Franchise King®, Joel Libava, is the author of Become a Franchise Owner! and recently launched Franchise Business University.

How to Start a Craft Business

By smallbiztrends, Guest Blogger
Published: October 31, 2017 Updated: October 31, 2017

It’s not unusual to turn a hobby into a business, and that includes crafting. If you have ever thought about selling your crafts or turning your crafting love into a part-time or full-time business, here are things to consider in how to start a craft business.

 

Research the Market Demand
If you’re looking to start a craft business, make sure there’s demand. Are people thrilled to get your crafts as gifts? Have people offered to buy your creations?
 
Here are two ways to research a craft business. Go to craft shows. Or browse craft marketplace websites like Etsy and Handmade at Amazon. See what’s already out there in your niche. Look to see if your items  fit into an existing product category (there’s likely demand), but there aren’t a gazillion sellers selling very similar items (too much competition for the same thing).

 

Differentiate Your Product Line
Differentiate your products from the competition. For example, there’s probably a lot of handmade kids’ clothes already out there. But you could “niche down” even further by making kids’ clothes out of sustainable fabrics, like Conscious Kids Clothing has done. Then you appeal specifically to that niche. Ways to differentiate include materials, quality of workmanship and unique designs.

 

Know Your Customers
Define your ideal customers. In the example above with sustainable kids’ clothing, the ideal customers are   environmentally conscious parents. If you hand-turn wooden pens, you might target those looking for small gifts as well as professionals who are image-conscious. Defining your ideal customer will guide you in how to display your products, create enticing product descriptions, decide which craft shows to attend, and more.

 

Choose a Name with Strong Brand Potential
Pick a business name that appeals to buyers and communicates what you sell. Don’t get too obscure. Pick something with meaning and strong brand potential -- catchy is good. Be sure to check the name’s availability. An attorney can guide you through the legal process to secure your business name.

 

Reserve Your Online Assets
A website is recommended, even if you plan on selling in person or on a large marketplace site. At the very least a website adds credibility and a way to contact your business. It can also operate as a secondary sales channel. Register a domain name to match your brand name. Then set up profiles in your business name on social media sites like Twitter, Facebook and Instagram that are popular with your target audience. 

 

Source Quality Materials
Making products is different from crafting for fun. You need a reliable source for materials -- and a lot of them. Some brands like Darice and Warehouse Craft Supplies offer volume discounts. Or you might opt to go to a retail craft store at first until you can justify bulk supply purchases. Know your material costs inside and out, so you can make a profit.

 

Develop a Selling Strategy
Figure out the selling approach YOU are comfortable with. If the thought of spending three days at a craft show sounds like punishment rather than a joy, look at alternatives such as selling at an online marketplace site. You could also set up your own ecommerce site -- two popular and affordable platforms are Shopify and BigCommerce.

 

Practice Your Product Photography
Great photography is essential for many craft businesses these days, due to the importance of social media and ecommerce. You’ll likely take your own pictures at first. Get the best camera you can and put together a clean backdrop with good lighting. You can purchase product lighting equipment from companies like B&H or SHOTBOX. You could also outsource photography to a professional.

 

Arrange Shipping
If any part of your business includes selling online, consider the shipping. Prompt and reliable shipping plays a huge role in getting good customer reviews. So compare prices and find a shipping provider, whether you go with USPS, UPS or FedEx. Then invest in good packing materials to avoid breakage.

 

Share Your Story
Consumers shop with independent artisans because they want something unique they can’t find elsewhere. But you can provide even more “uniqueness” by sharing your personal story. How did you get into your craft? Are your kids or family members involved? Do you support any causes with your profits? Share this on your website, on social media and elsewhere to create an emotional appeal to build a loyal community following. 

About the Author:

smallbiztrends
Anita Campbell

Guest Blogger

My name is Anita Campbell. I run online communities and information websites reaching over 6 million small business owners, stakeholders and entrepreneurs annually, including Small Business Trends, a daily publication about small business issues, and BizSugar.com, a small business social media site.

5 Key Financial Tips When Starting a Business from Home

By Marco Carbajo, Guest Blogger
Published: August 14, 2017 Updated: August 14, 2017

Did you know more than 52% of all small businesses in the U.S. are home based?

According to the Small Business Administration, there are more than 28 million small businesses in the United States, making up 99.7 percent of all U.S. businesses.

If you are considering or are in the process of starting a business from home, it’s an exciting and important undertaking. And as with any venture, it’s crucial to take the right steps to set yourself up for success.

Part of making sure you follow the necessary steps when starting a business from home can set the foundation needed to be successful. Here are five key financial tips to follow when starting a business from home.

 

1) Choose your entity structure

One of the easiest structures to start and cost the least to maintain is a sole proprietorship. If you select this structure then the legal name of your business is your own name. In most states, if you want to operate the business under a different name, you'll need to file for a DBA, "doing business as."

If you want to limit your potential liability then you may want to consider another entity structure such as a limited liability company. Be sure to consult with your attorney, accountant, or business counselor on the right entity structure for your business.

 

2) Obtain any required business licenses

As a home-based business chances are you will be required by your city or county to have a business license and permit to legally operate. Be sure to check your city or county’s website for details and the forms needed to file if required. The requirements and fees will vary based on your company’s activities, location, and rules outlined by your city or county.

 

3) Set up a designated office space

No matter how big or small your living space is, set aside a space just for your business.  Since you will be running a business from home you are required to establish a workspace to use in your home regularly and exclusively for your own business purposes. 

 

4) Open a business bank account

Your business bank account is a key financial tool that you will use to manage your business finances. From the moment, you start accepting or spending money as a business, you should have a business bank account set up. It enables you to keep accurate records, prepare reports, make deposits, and separate your business banking from personal banking.

To open a business bank account, you will need to provide your employer identification number) or social security number, if you’re a sole proprietorship), your business formation docs, ownership docs and business license if required.

 

5) Get a business credit card

A business credit card is a must have financial tool to keep your personal expenses separate from your business expenses. Not only does a credit card for your business make tracking expenses easy, it enables your business to start establishing its own credit identity and payment history with the business credit reporting agencies.

Starting a business from home can be challenging and overwhelming to say the least. There is a great deal to think about, organize, plan, and execute. The good news is there are many free resources, training, and support readily available to you both online and offline from the SBA. Be sure to check out all the free courses and support available through the Small Business Administration website.

About the Author:

Marco Carbajo
Marco Carbajo

Guest Blogger

Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. He is a business credit blogger for Dun and Bradstreet Credibility Corp, the SBA.gov Community, About.com and All Business.com. His articles and blog; Business Credit Blogger.com, have been featured in 'Fox Small Business','American Express Small Business', 'Business Week', 'The Washington Post', 'The New York Times', 'The San Francisco Tribune',‘Alltop’, and ‘Entrepreneur Connect’.

How to Develop and Use a Good Executive Summary

By Tim Berry, Guest Blogger
Published: July 6, 2017 Updated: July 6, 2017

Most business owners have a general idea of the executive summary that comes with the traditional business plan.  However, in the real world, summaries come up much more often than just in the business plan. How to create the summary, and how to use it, depends on the business objective.

The summary you say every day

I’ve always liked “Say your business plan every day,” which I heard first from Jim Blasingame, small business advocate.  Business is normally chaotic, so a quick reminder is a good idea.

Start with a sentence or two describing the fundamental strategy. Keep that in mind as you go through the day.

  • What do you do for whom?
  • How do you do it differently?
  • Why are you particularly good at it?

Add a sentence or two highlighting your most important tactics. It might be low or high price, high value, distribute via the web, market via social media, focus on repeat business, or whatever.

Then add the next major milestone you’re working towards. Maybe that’s some number, like 100 lunches in a day or 1,000 subscribers. Maybe it’s the new website launch, or the new product, or the new location. Give yourself an attainable nearby goal that is measurable.

Remind yourself once a day by reciting your personal business summary.

Create written summaries for special uses

Every business has to provide business summaries from time to time. For these you want to focus on the specific details so you can tailor your summary to your real business needs.

The general summary for publications and listings

Have a good summary on hand for general use. Think of it as a marketing document whose key goals include defining a target market and sending a message to that market. Often it starts with a tagline that comes straight from your main marketing. Follow that with information that generates a call or inquiry. You have to fit word count to the words allowed in your situational summary. Within that word count, optimize the information you can include to generate interest, include a call to action, and the information needed to follow up, such as phone number or website.

The executive summary for business loans and allies

For these summaries you start with either the personal summary or the general business summary above. Tailor these summaries to the specific use. The summary of strategy, tactics, and milestones is more likely to be appropriate for banks, and the more sales oriented summary of product, market, and main messages is likely to be more appropriate for allies, partners, and vendors.

For a summary going to a bank, related to a commercial loan, you probably want to add a financial summary including recent annual sales and profitability. The bank will require submission of detailed financial information as part of the application, so you don’t need to go in detail in the summary. You should make sure to include two or three sentences on business history, and two or three sentences describing the management team. It is also common that you add a paragraph about how the money involved will be used to help your business.

The executive summary for investors

To create a summary to be sent or submitted to potential investors, it’s good to start with a description of the problem you solve, how you solve it, and why you are well positioned to offer such a solution. Being well positioned includes your secret sauce, like proprietary technology or a special position in the market.

Investors also want to know the highlights of the recent past, recent milestones met, and key milestones for the future. Often that’s a matter of projected revenues for the next three years; but in some cases, other measurements such as numbers of users or subscribers can be used even if they are free. Investors want to see growth and growth potential.

For investors you also have to include a description of the management team with key details from team members’ track records and backgrounds.

And always, form follows function

Build a repository of text summaries, somewhere in your business materials online with backup copies in print. These are texts you’ve used in the past. Business summaries and executive summaries have to meet specific objectives. Most businesses end up saving various versions of different summaries. They pull them up and tailor them to the specific need each time a need is found.

About the Author:

Tim Berry
Tim Berry

Guest Blogger

Founder and Chairman of Palo Alto Software and bplans.com, on twitter as Timberry, blogging at timberry.bplans.com. His collected posts are at blog.timberry.com. Stanford MBA. Married 46 years, father of 5. Author of business plan software Business Plan Pro and www.liveplan.com and books including his latest, 'Lean Business Planning,' 2015, Motivational Press. Contents of that book are available for web browsing free at leanplan.com .

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