The Powerful Promoter
Many business owners agree that starting a small business will involve the personal finances of the owner, even though the business may be formally regarded as separate entities. This is probably due to the fact that the business owner may be likely to lose his source of income during the initial operations period, especially during the first 3 to 6 months. With this, adequate planning, budgeting and saving should be done by the business owner prior to starting the business so as to have a pool of funds to support personal expenses.
One of the first steps to do this would be to track your monthly expenses on a daily basis in order to adequately determine your actual personal costs. Be sure to include buffers for emergency or surprise expenses. Once you have a clear idea where your monthly expenses go to, you can then create a budget for the period that your income may be affected. It may also be a good idea to pay off any outstanding debt such as home loans or car loans, so that you have less to pay for during the critical period.
It is of utmost importance that you ensure that you have enough to sustain you, as many new business owners overlook this factor, and end up going back to employment while still maintaining their business after a few months, due to the lack of personal funds.
Apart from that, if you are starting a business for the first time and are in need of obtaining a business loan, the bank or credit union will evaluate your application based on your personal credit rating. This is due to the fact the company’s credit history is not yet available for references by these financial institutions. Therefore, the best history that they can base their judgment on your creditworthiness would be the credit history of the business owner.
What is the implication of this? This means if you are planning to start a business and obtain financing for it, it is best for you to run a check on your credit report in the event of errors and flaws. There have been cases where loans were rejected due to an unfavorable credit report, which was actually due to errors made by the system. With this, months may be needed to correct these problems, which may cause delays for the business owner to obtain the required start-up funding for the new business.
In conclusion, the business is a separate entity when it is registered as a private limited company. However, small business owners still may not escape entirely from being regarded as separate entities if they are the only owners of the businesses that they are running. Therefore, business owners should be well-informed on the areas that would require more focus on before they start their businesses.
Personal Finances for Business Start Up
Separating Business And Personal Finances
Money management is one of the most difficult tasks that a small business owner must face. In the early days, you may have a very uneven income stream, putting out personal funds for startup expenses and operating at a loss. As your business grows, it may become your primary source of personal income. Especially if you work alone or have only a few employees, it is easy for your business finances and personal finances to become intertwined. However, for many reasons, it is important that the two remain separate and distinct. Provided here is a guide to separating your finances.
Why Should I Separate My Finances?
The most important reason for separating your business and personal finances is for tax purposes. You may be entitled to certain deductions for your business, such as expenses for your home office and a mileage allowance for your vehicle. Many of these deductions are not available to individual taxpayers, only to businesses. Likewise, you may be responsible for paying certain taxes on your business that do not apply to your personal income. Separating your finances is the only way to ensure that you properly follow all tax laws and receive all advantages to which you are entitled by law.
Another important reason for separating your finances is the development of a paper trail. If you need to obtain money for the business through grants or loans, you will be expected to show certain financial reports that demonstrate the business’ performance. If your finances are separated it will be much easier to determine which income and expenses belong to the business itself.
Separating your finances can help you decide how best to grow and develop the business as well. You will be able to see the areas in which the business excels as well as those areas in which it needs some extra help. You can generate targeted, accurate reports and financial statements that show at a glance how the business performs in various areas.Painless Billing
How Can I Separate My Finances?
The easiest way to separate your business and personal finances is to open a business bank account. If you use credit to make business-related purchases, apply for a card in the name of the business. Have all payments made to the business account, and use only those funds and the business credit card to make purchases.
How Do I Get Paid?
You have multiple options for paying yourself. Some business owners find it best to write themselves a set paycheck every week. If you are confident that the business will retain enough funds to pay your salary each time, this will streamline the process and make it easier to accurately pay your personal income taxes.
However, if your business is new or unstable, you may find it better to pass funds through the business account to your personal account. You might decide to retain just enough money in the business account to pay for expenses, and transfer everything that is left into your personal account. This is an ideal solution for those who have many personal expenses but few business expenses and earn wildly different sums on each contract.
Setting Up and Maintaining Bookkeeping and Accounting
Many business owners find themselves confused and overwhelmed by the paperwork that is involved in maintaining separate accounts. Consider hiring outside help. A Virtual Assistant company such as IAC Professionals can set up and maintain your bookkeeping and accounting. Your VA can even handle payroll, writing your paycheck each week. You can maintain as much or as little control over the process as you desire. You can hire the VA for a set number of hours per week or per month, or simply retain his or her services on a per-project basis.
5 Tips To Make Your Personal Training Business More Profitable
The Fitness Consulting Group
Here are five simple strategies that any personal trainer can adapt to their business and almost instantly increase their profits:
1. Raise Your Prices. This is the most simple, yet overlooked strategy for increasing your income. If you perform 30 sessions per week and raise your prices by just five dollars per session, you’ve increased your yearly income by $7800. Not a bad improvement considering that you didn’t have to do anything else differently. Most of your clients won’t even bat an eye at this increase and the one’s that have a problem with a small price increase will almost always be your “headache clients.” Simply move on and you’ll soon replace them (if there are any) with a new client happy to pay your fee.
2. Have a “back-end.” The lifetime value of a client is the total amount of money that a client spends with you during the duration of the time you do business together. Most trainers limit this number to the amount that each client spends on personal training sessions. Since your clients undoubtedly view you as their fitness resource so don’t make them look elsewhere when they need to purchase supplements, foam rollers, nutritional coaching or anything else that would be complimentary to your personal training services. You’re helping your clients achieve better results, ensuring that they make the right choices when making fitness-related purchases and increasing your profits as well.
3. Practice “takeaway selling.” Most personal trainers’ approach to sales is to tell the prospective client how much they (the trainers) can do for the prospect and then close by almost begging the prospect to become a client. Unfortunately, this approach de-values the trainers’ services and gives the prospect all the power. Simply turn the table on the prospect. Tell the prospect that you are only accepting a very limited number of clients and then proceed to tell the prospect what will be expected of them should they be “fortunate” enough to be accepted as a client. Explain that they will have to be a “walking billboard” for your business and they will be expected to refer people who fit the mold of the client that you want to work with. You’ll be amazed by how many prospects literally beg you to take them on as clients.
4. The power of leverage. This is probably my favorite strategy. You can leverage other trainers by hiring them to train clients for you or “farming out” some of the clients you acquire and charging a “finder’s fee.” You can leverage your time by providing only semi-private training instead of the traditional one-on-one that forces you to trade your time for one clients money. You can leverage your knowledge by creating an information product that you can sell to your client or online. You can leverage your clients by having the “back end” I previously mentioned. Remember, you don’t always have to trade your time for one client’s money.
5. Institute an automated payment system. It works in health clubs, why not in personal training? Simply set your clients up on 4 or 6 month automated payment plans that are directly drafted from their checking account or credit card. This lets prospects know that you are only interested in taking on clients that are committed (that “takeaway selling” approach again) to getting results and it prevents you from being a bill collector. You’ll also get great piece of mind knowing what your receivables base is for the next few months.
These are just five of many strategies that you can use to make your personal training business more profitable. Go back through them and think of ways that you can implement at least a couple of these strategies into your business. Remember, if you continue to do what you’ve always done, you’ll continue to get what you’ve always gotten.
Change In Business - Personal History
Self Experience -- A brief story of our first major foray into the business world
The year is 1993 and three young men, who share a penchant for business, are searching for the right materials to get involved with after deciding that distribution as compared to manufacture is the way ahead in the day’s particular climate.
The studies went on for almost two years and as luck would have it, a relative of two of the men controlled a soft drink’s production factory; it was then intimated to the men that if they could source a certain product for him, even at the same price, he would give them a contract.
The men duly did this, the product was sourced and the new business was up and running.
Over the following several years, the product range expanded and the customer base continued growing, using the same business model of distribution with ever-increasing storage facilities, creating an ability to from an efficient part of any company’s supply chain management.
Then, as is the subject title of this article, the business had to change, was forced to change -- through clever marketing and good fortune we won a supply contract for packaging related materials that we did not even supply!
Hence we suddenly required a great deal of additional space, a great deal of new equipment and guess what? We were involved in a business model which went against the grain of every ounce of our studies and took us in a totally different direction to that planned. Thus, we had changed.
One may argue that business is always the same -- it’s just the commodity that changes.
So there we were with 45000 square feet of storage and manufacturing space, a large work force, health and safety issues and lorries to boot-everything we had planned against -- but we had a contract.
However, the years went by and we began to see a pattern emerging throughout the country of manufacturing businesses closing around UK in favour of moving to Eastern Europe or indeed the Far East.
Since our business was primarily in the field of primary or secondary packaging and it is essentially manufacturing company’s that use packaging we decided that it was time to sell the business as too many companies were chasing an ever-decreasing market.
So when we received an offer from our managers to buy, we accepted it and moved on.
Summarising, it is no longer possible to be inflexible in business and more than ever, since general market knowledge is greater than ever before due to the internet, the customer must be treated with kid gloves and cannot be pressed too strongly.
Whereas in times gone by, it was relatively easy to work with decent margins, even on generic products, customers can access swathes of information at the press of a button, thus forcing the seller’s position down and down.
This is all very well but it must be remembered that a business producing anything or storing anything must work off a decent profit level to be able to maintain the standards of quality and delivery performance.
Financial and Personal Advantages of Home Business Opportunities
You may be one of the many people looking for home business opportunities. There are several million people working at home today and a number of them are using their computers to make money. The Internet has opened up a new market to sell services and products worldwide.
You can be in charge of your future and have a successful business while working at home. There are moms who would like to stay at home with young children but still contribute to the family income. Even early retirees can find a new job to give them income and a new opportunity in life.
You may be someone who would like to work at home. You won't have to worry about an alarm clock, commuting drive, or an annoying boss.
Be Your Own Boss
One of the biggest advantages of home business opportunities is that you can be your own boss. You don't have to work specific hours every day and in many cases, the hours are only part-time. You can usually set your own schedule and work as little or as much as you desire.
There are different ways to make money on the Internet. You can work for yourself by selling services or unique products. You can set up your own website or advertise on other sites. You can also work for other people and leave the organization and management to someone else but still be an independent employee.
Many people have tried different schemes to make money on the Internet or to work at home. It is important to examine companies that promise great rewards when you sell for them. Some require hard selling and multi-level marketing where only those at the top of the chain win. These often do not work out as they are promoted. This is especially discouraging if a large investment has been made.
Home Business Opportunities
There are online sites that will give you ideas for work at home jobs. For a nominal fee, these sites will train you, set up your business, and support you as you work. There are a variety of home business opportunities to choose from. You can get paid to take surveys at home, make money from eBay, get paid to blog online, sell products, set up a travel business, or assist people with money brokering. With these methods, you can set the hours you want to work. Your income will depend on how much time you want to spend working.
There are advantages in going online to find a company to get you started in a home-based business opportunity. Usually there is no experience required, and the company will give you training. They have organized plans to help you get started in the right way. Some companies do all the set up so that you are immediately ready to do business.
Get Started on Your Own Business at Home
Your home business opportunity can be successful and fulfilling. Whether you want a part-time job or second income there are many opportunities to make money at home. By spending a few hours a week you can build your own business without a large investment.
6 Easy Steps to Separating Your Personal Life from Your Business
If you work from home, chances are you already know that you’re really pulling “double duty”. You probably work on your business while doing the laundry, corralling the kids, or fixing dinner... and let’s not forget all the phone calls from family and friends expecting you to run errands or just "go out" for an afternoon of fun.
One of the hardest parts of running a home business is separating your work from your family and social life. Here are six proven ways to keep your home life running smoothly while keeping your business on track.
1. First, create a work schedule and stick with it. It may be tempting to answer personal calls during the day or take business calls after-hours, but doing this actually shows that you’re expendable – not dependable – and people will take for granted that you’ll “always be there” for any little things that come up. Even though family comes first, stay true to your business hours and resist the urge to chat with friends or pick up groceries during working hours.
2. Your friends may consider “working from home” an invitation to chat during the day or just go out for coffee or shopping for an afternoon. Make it clear that your business hours are just that – for business. Leave personal calls for after-hours, and you’ll find that your friends will gradually accept your schedule without feeling slighted.
3. Just because you have to set up a work schedule, doesn’t mean that you have to keep the same hours as everyone else. One of the benefits of working for yourself is setting your own hours to fit your most productive times. Whether you’re an early bird or a night owl, you’ll find that you’ll get much more done when you’re attuned to your body’s own natural rhythms. Some people work in the morning, take a break in the afternoon when the kids are home from school, and work again in the evening. Schedule your work time when you feel the most productive and you’ll find that things get done easier, faster and better than when you were dragging along during those same rigid work hours that everyone else has.
4. If getting after-hours business calls or work day personal calls is a problem, it helps to have a separate business phone line, or at least an answering machine or voice mail, to take the incoming calls. This also gives your business a more professional appearance to clients than if you and your family make and receive calls from the same phone line.
5. If at all possible, try to separate your “home office” from the rest of your home. If you don’t have the luxury of a separate room, a room partition or screen can be just as helpful. This also serves as a visual cue to family that you’re working and shouldn’t be bothered.
6. Dress and act professionally while working. Some people find it helpful to dress in casual business attire during their working hours. This reinforces that just because you’re working from home doesn’t make you any less of a professional. Answer the phone with your name, or business name, and keep your children off the phone during business hours. Also, spend money investing in the tools you need to do your job right. A cell phone, fax machine or even a budget computer can help turn your home office into a true workspace.
If you follow all of these tips and stick with them, chances are you’ll find a routine that not only makes you feel productive and active in your business, but also projects the message that you mean business – literally!
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Appealing Business Personal Property Tax Assessments in Texas
"Collecting more taxes than is necessary is legalized robbery." These words of wisdom, spoken by the 13th president of the United States, Calvin Coolidge, still ring true in today's society for homeowners and business owners. Robbery may seem like a harsh word, but what would you say if someone tried to sell you one-year-old motel sheets for 90% of the original cost? Based on the appraisal district's depreciation schedule, this is a fair deal.
Most people would not consider this a fair deal and either reject the offer or request a lower price. This should be the same thought process when the appraisal district overassesses your business personal property (BPP). Texas law requires business owners to report BPP, personal property used for the production of income, to the appraisal district for assessment and taxation. Although there are no criminal penalties for not complying with the law, there is a penalty of 10% of the taxes. For example, if you have a BPP account assessed for $100,000, your annual BPP taxes are $3,000, based on a 3% tax rate. The 10% penalty for this BPP account would be $300 ($3,000 times 10% equals $300).
The huge range of assessed value for business personal property (BPP) makes obtaining substantial property tax reductions highly probable. It is not unusual for the range of assessed value for BPP accounts for similar properties to vary by 5,000%! For example, furniture and computers for companies within the same office building sometimes vary from $1 to $50 per square foot. Market value and unequal appraisal are two options for appealing BPP assessments. Given the inequity in BPP assessments and the subjectivity of valuing BPP, property owners have a high probability of success when properly prepared for a BPP assessment appeal. Protest both market value and unequal appraisal.
How to appeal?
To appeal your BPP, you can either use the Comptroller's form, or send a letter to the appraisal review board (ARB) on or before May 31st of each year. The protest letter to the ARB should identify the property and the reason for your protest (section 41.44d of the Texas Property Tax Code).
Tips:
· Since the appraisal district's staff tends to become more motivated to resolve appeals later in the season versus earlier in the season, it is better to appeal or protest on May 31st or shortly before the deadline date.
· Even if you do not receive a notice of assessed value for your BPP account, it is still important to send a written notice of appeal or protest. The appraisal district does not have to send a notice of your assessed value if the value does not change by more than $1,000. If the notice of assessed value gets lost in the mail, and you do not send a protest notice, you lose your right to appeal for the current year.
When sending a notice of appeal to the ARB, also send the appraisal district a House Bill 201 request. House Bill 201 refers to section 41.461 of the Texas Property Tax Code that allows property owners to obtain a copy of any evidence the appraisal district plans to use at the ARB hearing 14 days before the hearing. This request prohibits the appraisal district from using any information that was not provided to the property owner 14 days before the ARB hearing.
Market Value, Book Value & Comptroller Schedule
Three popular options for describing value for BPP are: market value, book value, and the Comptroller's schedule. Market value is defined in section 1.04(7) of the Texas Property Tax Code that reads as follows:
"Market value" means the price at which a property would transfer for cash or its equivalent under prevailing market conditions if:
(a) exposed for sale in the open market with a reasonable time for the seller to find a purchaser,
(b) Both the seller and the purchaser know of all the uses and purposes to which the property is adapted and for which it is capable of being used and of the enforceable restrictions on its use, and
(c) Both the seller and the purchaser seek to maximize their gains and neither is in a position to take advantage of the exigencies of the other.
Let's compare the differences in value resulting from using market value, book value and the Comptroller's schedule. The BPP for a typical motel room includes items such as bedding, linens, window air-conditioning unit, towels and a television. Based on market value, after one year, these types of items could probably only be sold for 10% to 30% of the original cost. Book value, based on federal depreciation schedules, indicates a value of 80% of the purchase price after one year. The Texas Comptroller's schedule for BPP for motels has an eight-year life with 10% depreciation for the first seven years. Hence, the Comptroller schedule indicates one-year old hotel furnishings are worth 90% of their original purchase price. This is clearly inconsistent with market value for these items.
Inventory
There are a number of controversial issues related to how inventory is assessed. These include shrinkage, damage, functional obsolescence and economic obsolescence. For example, what is the market value of merchandise returned during the week after Christmas on January 1st (the effective date for valuation)? Since returned merchandise has usually been opened, damaged, missing parts or may be an unpopular item, it is worth less than cost in many cases. Market value is relevant in determining the assessed value for inventory for Texas BPP taxes.
Preparing A Summary For Your Hearing
The appraisal district would prefer to see a fixed asset listing, which includes the original cost and date of acquisition for every asset purchased. However, a fixed asset listing is not required. This is good news for small businesses that do not maintain a fixed asset listing.
Unequal appraisal
Assessed values for BPP accounts often range from ten-times to fifty-times on a per square foot basis for companies in the same industry. For example, real estate brokerage offices, which have 10,000 square feet of office space, may have assessments ranging from $10,000-$500,000. It seems unlikely that the computers and furniture in one brokerage office are 50 times as valuable as those in a competitor's firm on a per square foot basis.
Appraisal districts tend to accept the assessed value rendered by property owners. Many large companies render using fixed asset listings. Appraisal districts use the cost basis information and the Comptroller's schedule to calculate the "market value" for property. The valuations for these rendered accounts tend to grossly distort the actual value of these properties. Property owners who do not render have values on the lower end of the range of value. While it seems intuitive that appraisal districts would penalize owners who do not render by sharply increasing their assessed values, the practice is the opposite. Appraisal districts tend to reward property owners who do not render by leaving their assessed values at modest levels. This creates a disincentive to render. It also unequally taxes property owners who render with a fixed asset listing. These factors have caused a high degree of dispersion in BPP assessed values.
How To Appeal On Unequal Appraisal
Contrary to popular belief, it is possible to appeal BPP utilizing unequal appraisal, a concept that is fairly new. Most property tax consultants and large property owners have not considered or utilized unequal appraisal regarding BPP. Appraisal districts are resistant to the concept of appealing BPP based on unequal appraisal. (It is inappropriate to tax property owners who render using a fixed asset listing at the highest level, based on utilizing the Comptroller schedule, when allowing property owners who do not render very lean levels of assessment.)
Preparing an appeal based on unequal appraisal for BPP is simple and straightforward. Start by obtaining information on the assessed value, and amount of office space/manufacturing or warehouse space for property owners similar to the subject property owner. This is typically done by using companies with the same Standard Industrial Code (SIC) as the subject property owner. You can obtain this information by sending an open records request to the appraisal district. When appealing, research the assessed value for your competitors. Compile data regarding the assessed value and building area for the subject and comparable accounts into a summary:
When should you appeal?
Appeal annually on market value and unequal appraisal. To effectively appeal on these two options, research unequal appraisal based on assessment comparables on the appraisal district's web site and evaluate the market value of your BPP. After reviewing both the unequal appraisal and market value options, determine your primary focus for appealing your BPP account. If neither market value nor unequal appraisal provides a basis for appealing your property taxes, you can withdraw the notice of protest or just skip the hearing.
Tips for your hearing (Informal & ARB)
Informal hearing
· First meet with the appraiser and politely explain the basis for your adjustment. Give the appraiser a copy of your evidence and explain it in a methodical way.
· The appraiser will review your information and the information he/she has available, and will then likely make an offer to settle. Consider the appraiser's offer and explain why your evidence is better than his/her evidence, and again request your value or a value between your value and his/her value.
· You will quickly learn the lowest value the appraiser is willing to accept. At this point, you need to either agree to that value or proceed to the Appraisal Review Board (ARB) hearing.
· If you settle the appeal at the informal level, you will not be able to pursue an ARB hearing or a judicial appeal. However, it does resolve the issue in a timely manner.
ARB hearing
· Introduction of the two parties at the hearing
· Explanation of the hearing process
· Property description (address any errors in the description of your property after the appraiser's description of your property)
· Property owner presentation
· Questions from the ARB panel members
· Appraisal district presentation
· Rebuttal and closing evidence from the property owner
· ARB announces its decision
Summary Points
· Annual appeals will minimize your BPP property taxes.
· There are huge differences between the market value estimated by the Comptroller's schedule and actual market value.
· Based on excessive assessments for BPP for companies who render using a fixed asset listing, a low percentage of property owners who render and the low assessed values for property owners who do not render, there are rich opportunities for appealing BPP by using unequal appraisal.
9 Top Business And Personal Applications For Blogs
Weblogs or blogs for short, can be developed around on nearly any and every subject. And not only for personal use, blogs can also be used effectively as business tools, for business of all sizes from Fortune 500 to home-based operations.
Many have found that a blog is similar to a personalized money churner for their websites and businesses. In fact blogs can function as stand-alone websites with a full assortment of features; such as, automatic archiving, comment posting, pre- and post-dating entries, survey tools, remote capability, easy management, RSS feeds, subscriber box, statistics, IP banning, Google™ Adsense capability, sidebars, full color templates, assorted marketing means like SEO tools and much more, depending upon the blog and hosting set up.
Blogs actually have a variety of practical applications for both businesses and individuals using them for personal use. Some popular applications are:
1) Content management system (CMS) – With good blogging software, you can manage the content of your website in an efficient manner. For example, with good a blog content management program, you can add multiple authors and even pre- and post-date entries, loading them in advance in order to take time off for a vacation.
2) Organizational Updates and Calendar of Events - Blog software also sorts your posts chronologically, giving the latest entry first place for enhanced readability, even allowing posts via email. Plus you can incorporate a calendar to quickly find and click posts on each date that bears an interactive hyperlink.
3) Customer Relations Board - A blog can also serve to increase credibility and help boost your customer relations. Web visitors can post comments and questions on the blog and even use its knowledgeable base of posts sorted by categories as a public relations tool. Your blog will also allow your customers to find information quickly and easily with a search tool.
4) Sales Booster – You can use a blog to describe your products and services, listing them by categories and incorporating multimedia into the posts: digital photos, video and audio tutorials, PowerPoint slide show manuals, Adobe PDF guides and more. Invite visitors to subscribe to the blog for product and service updates, specials, coupons, an award points program and more.
5) Media Center – Post your press releases, digital photos, company history, executive resumes and article clips on your blog to boost the public relation efforts of your company.
6) Interactive Education – Educate your prospects and customers with your blog. Discuss not only your products and services, but your industry. Keep readers abreast of industry development and news. Invite feedback and reviews from your blog readers and industry professionals.
7) Community Development – Focus on developing a community of any size and invite participation from your blog readers. Invite file sharing, uploading digital photos and video clips, for example, with critiques and reviews.
8) Service Providers - Blogs can also serve as service providers by sharing news and relevant and detailed technical information about your products and services in a timely fashion. For example, add one inside your member area, and once members log in, they can click your blog as an updated knowledge database that discusses issues linked to specific dates so they can immediately catch up since their last log in day. Plus they can read through your categorized entries to problem solve tech issues and more 24/7 at their leisure and own pace.
9) Internal Communication System- You can set up a private blog; for example, for your own members or company workers and associates for intra personal communications. Display the latest information there and invite feedback and interaction, even adding surveys.
Hence, blogs can definitely be used in a variety of applications for both business and personal functions. They can serve as interactive tools like discussion boards and message forums or focus on any number of other software features to help a diverse audience interact via a common platform.