| Starting Business Secrets will help you to start your | | | | |
| own business successfully. | | | | For corporations, you'll also need a corporate |
| | | | resolution approving of the opening of your business |
| The American Dream is, and always will be, to come | | | | account. |
| up with an idea, start a business and become rich | | | | |
| from your own efforts. Based upon this motivation, | | | | There are different policies exercised in just about |
| thousands of businesses fail each year, due primarily | | | | every state regarding installation/hook-up charges by |
| to not being familiar with the basics involved in | | | | the telephone and utility companies. Some require a |
| running a business. | | | | deposit, and some don't. |
| | | | |
| This report will enlighten you, and give you a number | | | | You'll find that a great number of city business license |
| of suggestions you can use to better guarantee your | | | | departments are there solely for the purpose of |
| chances for success. This report is written with the | | | | collecting another tax. Depending on the type of |
| warning that any and every business venture | | | | business you're asking a license for, the building and |
| contains certain inherent risks, and any number of | | | | zoning people may inspect your premises for |
| alternatives. We do not espouse that any one way is | | | | soundness of structure and safety. Generally, you |
| the right way or that our suggestions are the only | | | | won't encounter any difficulties - you simply pay your |
| way. On the contrary, we advise that before | | | | fee to operate your business in that city, and the |
| investing any money in a business venture, you seek | | | | clerk types your name onto a city license certificate. |
| counselling and help from a qualified accountant and | | | | |
| or attorney. | | | | Relative to sales tax permits and licenses, each |
| | | | state's rules and regulations very widely. The best |
| Just about the first thing you should consider before | | | | thing to do is call your state offices and ask for |
| deciding to start or purchase a business is the legal | | | | information concerning registry and collection |
| form you'll be operating under. There are basically | | | | procedures. Many states require an advance deposit |
| four choices: sole proprietorship, partnership, limited | | | | or bond, and you'll find that some wholesalers or |
| partnership, and/or corporation. | | | | manufacturers will not sell to you at wholesale prices |
| | | | until you can show them your sales tax permit or |
| Each has a number of advantages and disadvantages. | | | | number. |
| We'll try to enumerate some of them for you. | | | | |
| | | | Should your business entail selling your products or |
| As much as anything else, for many people starting a | | | | services across state lines, in another state, you're |
| business is a form of ego-gratification, and they form | | | | not required to collect taxes except in those where |
| a corporation for some sort of prestige gain - just to | | | | you have offices or stores. |
| say, "I own a corporation." | | | | |
| | | | You may find also that your particular business |
| With just a little bit of observation, you'll find that | | | | requires the collection of Federal Excise Taxes. For |
| one of the major causes of business failures is due | | | | information along these lines, check in with your local |
| to the founder wasting start-up capital on frills, such | | | | office of the Internal Revenue Service. |
| as an impressive store- front office, expensive | | | | |
| furnishings, and corporate legal costs. | | | | Some states also require certain businesses to hold |
| | | | state licenses, such as those required in many states |
| One of the basic traits you must develop it you're | | | | for TV Repairmen. |
| going to be successful in business, is a tight hold on | | | | |
| your expenditures. In fact, a good rule of thumb is | | | | These are known as "occupational permits" and are |
| that anything that does not make money for yo or | | | | most often required of barbers, hair stylists, real |
| protect your investment, should not be purchased at | | | | estate people and a number of other consumer |
| this time. Very definitely, this applies to the expense | | | | oriented businesses. If you have any doubts, check |
| of setting up your own corporation. | | | | with your state offices for a list of those |
| | | | occupations that require licensing. |
| Unless you have a partnership and start your | | | | |
| business as such, the only real advantage to forming | | | | Any business doing business in any type of interstate |
| a corporation would appear to be that a corporate | | | | commerce is subject to federal regulations, usually |
| structure will semi-protect the property you | | | | through the Federal Trade Commission. This means |
| personally own. | | | | that any business that shops, sells or advertises in |
| | | | more than one state is subject to such regulation, |
| As an example, you own a home and car. You form | | | | and this includes even the smallest of mail order |
| a corporation to protect these possessions from | | | | operations. |
| business losses. Yet, if you can be found guilty of | | | | |
| misusing corporate funds, your business creditors can | | | | Normally, very few business people ever have and |
| pierce the corporate shield and come after your | | | | contact with the federal regulatory agencies. The |
| possessions. | | | | only exceptions being when there is a question of |
| | | | your operating your business unethically or illegally. |
| Basically, if you invest everything you have in your | | | | |
| business, as most newcomers do, you don't usually | | | | Any business that sells or distributes food in any |
| need a corporation because you have nothing to | | | | manner almost always requires a county health |
| protect. Your household possessions, personal | | | | department permit. If your business falls into this |
| belongings, generally your car, and even a portion of | | | | category, simply call the county health department |
| the equity in your home is protected by the | | | | and invite them out to your place of business for an |
| homestead provision of the Federal Bankruptcy Act, | | | | inspection. The fees generally range from about $25, |
| and cannot be taken away from you. | | | | depending on the size of your business when they |
| | | | first inspect it for permit approval. |
| As a sole proprietor or partner of a business you'll be | | | | |
| paying taxes on your overall earnings, much the | | | | There are also a number of businesses that require |
| same as if you were holding down a salaried or | | | | inspection by a fire marshall, and fire department |
| hourly paid job. Whether you do or don't take out | | | | approval. Generally, these are those that handle |
| money as a salary will have no bearing on the | | | | flammable materials or attract large numbers of |
| earnings of your business and tax return. | | | | people, such as a theater. Overall, the local fire |
| | | | department has to be allowed to inspect your |
| The often advertised advantage of incorporating, | | | | premises whenever they desire to do so. |
| that you can manipulate your salary in order to save | | | | |
| on tax dollars, is real because of corporation laws. | | | | You may also run into a requirement for an air and/or |
| However, the IRS frowns on this practice. When | | | | water pollution control permit. These specifically apply |
| your business is successful and making a lot of | | | | to any business that burns anything, discharges |
| money, definitely check with your accountant on the | | | | anything into the sewers or waterways, or use any |
| advantages of incorporating. | | | | gas-producing product, such as a paint sprayer. |
| | | | |
| As a corporation, you'll be subject to a number of | | | | Without a doubt, you'll need to check on local |
| other drawbacks as well: generally higher state taxes, | | | | regulations relating to advertising display signs. Each |
| stricter laws concerning the operation of your | | | | city or township makes its own rules and then |
| business, more elaborate accounting procedures, and | | | | enforces those rules according to its own thinking |
| legal papers that are required just about every time | | | | -check before you contract to have a sign made for |
| you make a major move or sign almost any contract. | | | | your business. |
| Thus, your legal and accounting fees will be much | | | | |
| higher as a corporation than will those required for a | | | | The design and placement of your sign is very |
| sole proprietorship type of business. | | | | important to your business - specifically to retail |
| | | | establishments - but let me remind you that your |
| As a sole proprietor or partnership, you'll find many | | | | business sign is usually the first thing a potential |
| areas require the registration of your business name. | | | | customer sees and as such, it should catch his eye |
| The cost however, is minimal, ranging from $5 to | | | | and leave an impression that lasts. It would be a |
| $100. About the best way to find out what laws | | | | good idea to ride around your town and take a look |
| apply in your area, is to call your bank and ask if they | | | | at the signs that catch your eye, and try to |
| need a fictitious name registration card or certificate | | | | determine the impression of the business that sign |
| in order for you to open a business account. | | | | leaves on you. This is a basic learning formula for |
| | | | determining the design, size and placement of your |
| Selecting a name for your business is quite important | | | | business sign. |
| to you and particularly relative to advertising. Your | | | | |
| business name should describe the product or | | | | Some of the other things to consider before opening |
| services you offer. Fancy names such as, Linda's | | | | for business - If you intend to employ one or more |
| Clipping Service will lose potential "walk-in and passing" | | | | employees, you'll be required to deduct Federal |
| customers to the beauty shop across the street that | | | | Income Taxes, and Social Security payments from |
| calls itself, Patti's Beauty Salon or Jane's Hair Styling | | | | their checks. This will involve your filing for a Federal |
| Shop. | | | | Tax Number and necessitates contact with your local |
| | | | IRS Office. |
| The advantage of using your full name in the title of | | | | |
| your business, such as Johnny Jones' Meat Lockers, | | | | Most states have "unemployment taxes" which will |
| has the advantage of making credit somewhat easier | | | | have to be deducted from the paychecks of any |
| to come by - provided you pay your bills on time - | | | | employees you hire. And there are a number of |
| but it also includes the disadvantage of confining your | | | | states that have income taxes - disability insurance - |
| services to a local or at most, a regional area. | | | | and any number of other taxes. Again, the best thing |
| | | | to do is check with your local office of the IRS. And |
| Should you buy, lease, or rent a space for your | | | | above all else, don't forget to ask for the rules of |
| business? think twice before you make any decision | | | | the minimum wage law, and comply. |
| along these lines. Most businesses tend to grow | | | | |
| quickly or they never get off the ground. | | | | When your business grows to the point of needing |
| | | | additional help, don't be afraid to look for and hire the |
| There are a few exceptions, but only a very few, | | | | help you need. when you're ready to hire someone, |
| that tend to grow at a modified rate. | | | | simply run an ad in your local paper and/or register |
| | | | your needs with the local office of your state's |
| So, buying a piece of property and setting up your | | | | employment service. Businesses either grow or die, |
| business on or within that property, obligates you to | | | | and those that grow eventually need more people in |
| ownership regardless of what happens to your | | | | order to continue growing. |
| business. | | | | |
| | | | When that time comes, hire the additional people you |
| Leases are almost always very strong contracts | | | | need, and your business will continue growing. If you |
| written by attorneys to the advantage of the | | | | don't, for whatever reason, you'll find yourself |
| property-owner. When you sign an agreement to | | | | married to your business and your business growth |
| pay someone for the use of their space over any | | | | stymied. |
| length of time, you're "nailed in" to paying for that | | | | |
| space regardless of what happens to your business. | | | | Regardless of how small your business is when you |
| | | | begin, never walk in with the thought in mind that it's |
| In the beginning, it's wise to either get the | | | | something to keep you busy. Anyone with an |
| shortest-term lease possible, or arrange to rent with | | | | attitude of that kind is a fool. You begin and make a |
| an option to lease at a later date. This does not | | | | business successful in order to realize financial |
| apply to a retail business, unless your particular | | | | freedom. Establish your business. Put it on its feet, |
| business happens to be an untried one. | | | | and then hire other people to do the work for you. |
| | | | And those businesses that require an operations |
| Definitely, you should open a business bank account. | | | | manager, or someone to run a phase of the business |
| In selecting a bank for your business, scout around | | | | you're too busy to handle, hire the person needed or |
| and look for one that can, and will help you. | | | | the business will surely suffer. |
| Determine what your banking needs will be, and then | | | | |
| via telephone, interview the managers of the banks | | | | To protect the investment of your business, you |
| in your area. The important convenient bank to your | | | | need business insurance. If you've never had any |
| business location. | | | | experience with business insurance, simply look under |
| | | | the heading of "business insurance" in your phone |
| A point to remember: the closer you can make the | | | | directory. Ask for bids from several different |
| relationship between you and the bank manager, the | | | | companies or agents...Primarily, you should have a |
| better your chances are going to be for approval on | | | | policy that gives you general liability, fire, workmen's |
| loans and/or special favors you may need at a later | | | | compensation, business interruption, and vehicle |
| date. | | | | coverage. You amy also want coverage against |
| | | | possible losses related to burglary, robbery, Life & |
| Try to become acquainted with as many of the bank | | | | Accident, Key Man, and Fidelity Bonds. |
| employees as possible. The better you know them, | | | | |
| the more courtesies they'll be extending especially to | | | | As the sole proprietor of a business, you won't be |
| you in the course of your association. | | | | paid as an employee, so there will be no income tax |
| | | | deducted from whatever you withdraw from the |
| Just as a doctor is a specialist in his field, and you go | | | | company's earnings. What you'll have to do is a gain |
| to him for medical problems, your banker is a | | | | check with the IRS Office for a Tax Guide For Small |
| specialist in his field and you should go to him for | | | | Businesses Handbook, and probably end up filing an |
| your money problems. In business, you'll have to learn | | | | estimated tax return on a quarterly basis. |
| that everyone is an expert in his own line of work, | | | | |
| and in your associations with other business people, | | | | The minute you open your doors for business, you'll |
| refrain from acting like a "sharpie" and/or pretending | | | | have to spend some time engaged in the work of |
| that you know exactly how everything works in | | | | bookkeeping. Exactly how, and using what forms, |
| someone else's specialty. | | | | you keep books, should be on the recommendations |
| | | | of a good tax counselor...The same holds true for |
| You'll find that very often, different banks specialize | | | | your overall business and/or payroll accounting |
| in different types of businesses. As an example, | | | | system. Look for an experienced CPA that knows |
| you're sure to find banks that specialize in real estate | | | | the accounting problems to your particular kind of |
| transactions, export- import businesses, and even | | | | business, and solicit his advise/counseling. |
| manufacturing operations only. | | | | |
| | | | If your business is going to involve the possible |
| What I'm saying here is that if you're planning to sella | | | | purchase or lease of operating equipment, again seek |
| fairly expensive item, your customers will probably | | | | the help of your tax counselor for the most |
| need and/or want financing. It will behoove you to | | | | advantageous method of obtaining the needed |
| select a bank familiar with your type of product that | | | | equipment. |
| will afford your customers, through you, contract | | | | |
| financing. | | | | Basically, arranging for your suppliers to give you |
| | | | materials on credit will depend upon your honesty and |
| Some of the questions you should ask of your | | | | personal financial statement. The best way is usually |
| banker include the following: | | | | a personal visit to the person with the power to |
| | | | approve or disapprove of credit at the company |
| Is it necessary to maintain a certain balance in your | | | | where you want to set up a credit account. Show |
| account before the bank will approve a loan for you? | | | | him your financial statement, and explain your |
| What qualifications must you have in order to obtain | | | | prospects for success. Then assure him that you've |
| a line of credit with the bank? | | | | always honored all of your obligations, and that if |
| | | | ever there's a question or problem, you'd like for him |
| Does the bank limit the number of loans, or types of | | | | to call you at home. And of course, give him your |
| loans it will approve for small businesses? | | | | home phone number. |
| | | | |
| What is the bank's policy regarding the size of a | | | | We won't go into the exigencies of advertising your |
| check you might deposit that requires holding for | | | | products, services or business here, but there is |
| collection? | | | | something along these lines you should always keep |
| | | | in mind. The best kind of advertising your business |
| And what about checks less than that amount - will | | | | can receive is that you don't really pay for - publicity. |
| they be immediately credited to your account? | | | | |
| | | | When something unusual happens to you, your |
| In almost all types of businesses, it will be to your | | | | business, or your employees - that's news, so be |
| benefit to set up with your bank, a method of | | | | sure to tell the news media in your area about it. |
| handling VISA, Master Charge, and regional credit | | | | |
| cards. The important thing here is to ultimately set up | | | | The most important ingredient of your eventual |
| your account in the bank that will service all of these | | | | success will be the soundness of the planning you did |
| credit transactions for you - one stop for all your | | | | before you started your business. Any number of |
| banking needs. In most instances, you'll find that | | | | bad things can really throw your business into a |
| having the capability to fill orders/make sales via | | | | tailspin, but it you've done your homework well - |
| credit card transactions, will increase your volume of | | | | really set up a detailed business plan before starting - |
| sales appreciatively. | | | | your losses or setbacks will be minimal. Success takes |
| | | | planning, and within this report, you've got a basic |
| Once you've made the decision as to which bank is | | | | checklist...The rest is up to you...Good luck, and may |
| going to handle your account, you'll need your Social | | | | your life overflow with success in all that you |
| Security Number or your Federal Employer's | | | | undertake from this moment forward. |
| Identification Number, your driver's license, the | | | | ---------------------------------------------------------Julia Tang |
| fictitious name certificate, and if you're requesting a | | | | publishes Smart Online Business Tips, a fresh and |
| VISA or Master Charge franchise, you'll also need a | | | | informative newsletter dedicated to supporting |
| financial statement. | | | | peoplelike you! |