Booking Hotels Reservations

To get approval for your small business loan application, you must be able to meet the lending criteria set down. Some organisations are more risk averse than others, and will therefore have more stringent criteria.

To vastly increase your chances of a successful funding application, you will need to present the following information:

1. The reason for the loan. The lender will be looking for something that fits within the normal range and expertise of your business. The amount may cover a number of items, so you will need to cover each.

2. The amount required, and the repayment term of the small business loan you want. (e.g. $10,000 term 5 years, payable quarterly).

3. Details of how you will repay the amount borrowed. For example, “From the increase in profits of reduced running costs of the Whizzbang Go4It”

4. Details of security you will be able to offer to the lender. This will act as reassurance for the lender. If you’re not prepared to put up some aspect of security, then why should they?

5. You will need to include your business plan which will serve to answer essential questions relating to management capabilities, information about the market you operate in. What kind of business you are in etc.

6. 3 Years financial statements. You will need to present quality financial information from your accounting software, preferably signed off by your accountant or tax advisor.

7. Latest Set of Management accounts. Again produced from your accounting software.

8. Accounts receivables (debtors) and payables (creditors) ageing reports.

9. Principals financial statements. – Particularly required if some form of security is necessary.

If you are a new company, the emphasis is going to be on your business plan , and the security (also called collateral) you or your business can provide against the loan.

You must take the time to practice presenting your case to the bank or lender to iron out any glitches. Practice on your colleagues and family (you never know, they might be so impressed, they’ll invest or lend!). It may help to role play the lender and come up with as many pointy questions as possible. The more time you take the better your chances will be. (But remember, don’t fall into the analysis paralysis trap!)

Good luck!

About the author:
Neil Best

Ralph Waldo Emerson said, “Build a better mousetrap, and the world will beat a path to your door.”

But when you’re starting your own business, there’s no guarantee that your “mousetrap” is going to survive, especially in today’s fast-paced business world.

Nearly half of all small businesses fail within the first two years of operation. The number one reason for business failure is inadequate planning. The second reason is under-capitalization.

So before you mortgage your house, or go into debt financing your business, you need to know if your business is going to do more than survive — you want to know if it’s good enough to thrive! Here are three things successful businesses that have stayed in business for five years or longer have in common:

1. The idea. A successful business start-up always starts with an idea. Something that makes your business stand out from all the rest. So how do you know if you’ve got a good idea?

You’ve probably got a good idea if you can answer yes to any of the following questions: Does your idea provide the solution to a significant problem for your target market? Does it satisfy a need or want? Does it create an opportunity?

The most successful businesses either fix problems (either real or perceived), or they increase your customer’s pleasure. They create a repeat need for a product or service among the target market.

2. The market. Your chances of survival are better if you can answer the following questions with a yes: Is there already a market for your product or service? (It’s much easier to fill a need than trying to create an entirely new market.) Can your target market afford to buy your products or services? (If they can’t afford it, it doesn’t matter how great it is, you won’t sell any!) Will your target market perceive your product or service as valuable? (If they want it, but don’t think it’s worth what you’re selling it for, you won’t make any sales.)

3. Your ability. Do you have the people, the resources and the knowledge to be able to consistently provide your products or services to your target market? Can you maintain a competitive advantage? Do you have enough manpower? Can you purchase the supplies and materials you need over the long run?

Your first step always is to create a solid business plan. Your business plan is more than an essay on “Why I deserve to get funding for my idea” however. Don’t spend all the time creating a business plan and then toss it in the bottom drawer of your desk. Your business plan should be a living, breathing roadmap that helps you make sure you’re on course and reaching the goals that you set for your business.

The second step to business survival is getting enough financing. Although the term “bootstrap entrepreneur” describes most small business owners, having enough capital to be able to keep your business afloat is vital to your survival.

When you’re creating your financial analysis of your business, make sure you’re being realistic about costs and expenditures, so that you give yourself the cushion you need to succeed.

If finding financing is a problem, either because you don’t have enough credit or equity, or there are other problems, take the time to look into the resources that are available in your community. There are a wide variety of grants and loans (including microloans) for entrepreneurs, if you know where to look.

Some great resources will be:
-The Small Business Administration
-Local Small Business Development Centers
-Women’s Organizations
-Local University or Community College
-Chamber of Commerce
-SCORE (The Association for Retired Executives)
-Nonprofit organizations that work on economic development in your area

Use other successful business models as a guide. When you’re getting started, look around. What businesses are successful? Why? What is it they’re doing that is working? What attributes do you admire, and why? You stand a better chance of succeeding if you’re modeling someone who is already successful.

Find a mentor. Most entrepreneurs have great skills and abilities, but no one does everything well. You probably already know what your strengths and weaknesses are. (If not, there are many resources and tools that can help you figure it out!) Rather than ignoring your weaknesses, find a mentor who can help you either build your skills in your weaker areas, or offer advice for getting what you need.

If you take the time to plan to succeed, you could be creating a legacy that will be enjoyed by future generations, and that other entrepreneurs will look at as a model for building their own businesses.

About the author:
Hans Hasselfors

There are definitely advantages, but make sure you make an informed decision!

There are a lot of advantages to outsourcing, however, there are also some disadvantages. Since this is such a huge issue, and such a large decision for you to make regarding your company, you should make sure that you take a good look at both sides of the issue before you make your decision. Make sure you know exactly what you stand to gain or lose by outsourcing your work.

First of all, the advantages of outsourcing for your business are that you’ll be able to get some of the less important jobs done for cheaper. For instance, if you’re finding that you do not have enough money in your budget to make necessary changes in order to keep your business afloat, then you should probably find a way to reduce the amount of money that you’re spending.

Another advantage of outsourcing is that there are actually other companies and places where you can get the work done better than you are already in your own company. Not only that, but if you have a company that requires a large number of different products or services in order to function, it might take less time for you to find a good outsourcer than it would take you to train new people.

There are a few disadvantages to outsourcing, however, and you should definitely take those into account as well. For one thing, if you outsource, it means that you’re going to have to work very closely with the company that you outsource your work to. Otherwise, you won’t get the finished work as soon as you need it. Having another company involved in your business might get tiresome after a while.

Another thing that you should consider is that depending on where you outsource to, it might hurt your business. This is generally only a big deal if who your customers are really matters, or if you’re a very small business. Some people shop at small businesses because they’re local - and if you’re a business like that, then outsourcing might be to your disadvantage.

In the end, however, the question of whether or not outsourcing is right for your business can only be answered by you.

Jakob Jelling

There are a myriad of things you must think about when opening any type of business whether it is a small business or a large corporation and one of those is how business law may affect you. Failure to pay attention to business and corporate law can land you in a world of trouble-both legal and financial. The good news is that you do not necessarily need to be a graduate of a fancy business law college or have a business law major to brush up on the basic ideas of small business law and corporate business law.
If you’ve paid attention to the headlines lately, you probably know that employment law for business is one of the number one areas where you can get into trouble if you aren’t up on all the employment laws and regulations. There are numerous laws that govern the employment of both regular employees and contract employees. Just for a broad overview, take a look at all the employment business laws you must meet:
· Civil Rights Act of 1966.
· The Equal Pay Act of 1963
· Americans with Disabilities Act
· The Immigration Reform and Control Act of 1986
· The Age Discrimination in Employment Act
· The Equal Employment Opportunity Act
· The Bankruptcy Act
· The Occupational Safety and Health Act
· FMLA, the Family Medical Leave Act
· Employee Polygraph Protection Act Labor Law
· FLSA, the Fair Labor Standards Act
And that’s not even counting the various state employment business laws that might apply to your business! If you aren’t sure of whether you are meeting all the regulations, it’s a good idea to get a checkup for your HR department.
Do you happen to work in the international arena? If you have anything at all to do with international business, then you should be aware of the many ways in which international business law can affect you, your business and your bottom line. At a minimum, you need to make sure that you meet general international business laws, specialized export laws, import laws and any laws of the foreign country in which your business operates.
And what about the business law scene at home? Were you aware that in addition to Federal business law and international business law, you are probably required to meet State business law regulations? Do you know whether you need a business permit or license? Failure to obtain one can result in the shutdown of your business and hefty fines and penalties. This is just one of the ways that state business law, such as California business law, can affect the health of your business if you aren’t careful to stay on top of things.
Finally, what about Internet and online business laws? Were you even aware that there was such a thing? The Internet has exploded so much in the last decade that the government has found it necessary to institute Internet compliance laws. If you operate a website of any kind and do not meet the compliance regulations, that site could be shut down and you could face criminal prosecution and hefty fines.
Of course, no one should ever attempt to navigate the complexities of any type of business law alone and the best course of action is to always seek the qualified professional advice of a business law firm, but hopefully these tips will help you to understand a little bit more about business law requirements.
Summary: When operating a business, regardless of whether it is a small business or a large corporation, you need to be on top of business law compliance. Even if you hire a business law firm, it’s still a good idea to understand what regulations you must meet.

About the author:
Matt Bacak

When starting a business, you have to determine the method you are going to use for accounting and paying taxes. The two choices are the cash method and the accrual method.

Cash Method

If you are looking for simplicity, the cash method is probably your best accounting choice. Generally, income and deductions can be claimed when payment is actually received or made. This is best shown with an example.

I open a small business and have to order business cards and stationary. I receive the products and pay the invoice on November 18, 2005. Under the cash method, I can deduct the cost on my 2005 tax return.

Some businesses are restricted from using the cash method. C corporations may only use the cash method if they have less than $5 million in gross revenues for a particular year. Professional Service Corporations can use the cash method without limit, while farming corporations can due so if gross revenues are less than $25 million. Tax shelters are prohibited from using the cash method.

Accrual Method

The Accrual Method of accounting is a bit more complex. Under this method, the focus in on the date the expense is incurred, not paid. Although this may seem a small difference, it can play havoc with your books and piece of mind.

Using our previous example, assume I order business cards and stationary on the December 18, 2005. I receive the products on December 30th, but don’t pay the invoice until January 20, 2006. When can the expense be claimed? It depends on when economic performance occurred.

Generally, economic performance occurs when goods or services are provided to you. In the above example, economic performance would arguably occur when the business cards and stationary were delivered with the invoice on December 30th. Thus, I would be able to deduct the expense for the 2005 tax year.

In Closing

As you can see, the cash method is the easier of the two accounting methods. To determine the best method for your business, speak with a tax professional.

About the author:
Richard Chapo

For many, the American dream of owning a business is in queue right behind owning a home. I was a teenager when I owned my first business. Since then I have bought or started many businesses and helped others do the same. Here are some common mistakes I have witnessed or committed myself.

Paying too much

This results from the combination of all other mistakes. Many new business owners set themselves up for failure by paying too much, which results in higher loan payments, lower operating funds, and reduced borrowing capacity.

Letting your emotions rule

If you have always dreamed of owning a business, it is very easy to get caught up in the strong emotions invoked by seeing those dreams coming true. To counteract your emotions, take your time, do your homework, and enlist the help of objective advisors.

Paying for potential

You should only pay for the business as it stands at the date of purchase, not what it could be in the future. You will have to spend time, effort, and money to develop its potential. The seller chose not to invest these things, so he does not deserve to be paid for them.

Not evaluating yourself

Do you have what it takes to run this business? Try to match your strengths to the important duties you will be required to perform. Running a small business requires the owner to do many things. No one can be good at them all, so make provisions for those areas in which you are the weakest. Some tasks like payroll and bookkeeping can easily be contracted to outside vendors. Possibly your spouse, other family member, or a partner could do things that you cannot or do not want to do.

Not building a team of experts

At a bare minimum, you should enlist the aid of an attorney and a CPA. The attorney can prepare and review documents, help structure the deal, and make you aware of legal and liability issues. The CPA can provide a financial analysis of the business, and advise you about tax and accounting matters. You should consider adding a business valuation professional. His valuation report can be used to determine the reasonableness of the asking price, negotiate a lower price, and provide valuable information about the business, the industry, the competition, and the economic conditions.

Relying on bad information

You should verify all important information about the business. Your CPA can check financial information like receivables, payables, and inventory. Your attorney can review loan documents, leases, and contracts. Your business valuation professional can analyze the competition, the industry, and the economic conditions. Use independent appraisers to value real estate and equipment. Get a credit report on the business through your CPA or banker. You can do some of the investigating yourself to save money, but do not cut too many corners – it may cost you in the long run.

Changing too much, too fast

Once you own the business, you will be tempted to start making wholesale changes from day one. You risk alienating long-time employees and customers. Unless the business is in bad financial condition and needs immediate action, its better to take some time to get to know the business, your employees, and your customers before making changes. This is a perfect time to solicit suggestions from employees and customers.

Buying a business because you like to do what the business does

One reason restaurants have a high failure rate is people buy or start them because they like to cook. Very few restaurant owners spend time cooking. Their time is spent managing staff, ordering supplies, doing paperwork, and handling daily crises. A small business owner must wear many hats – including that of manager.

Not being interested in the business’s product or service

I made the mistake of thinking that because I am a CPA and smart that I could own and operate any business. I bought a business that sold high-performance auto parts to young men who drove jacked-up, four-wheel drive pickup trucks and went to the drag races every weekend. I did not do either and never understood why anyone would. I could not relate to my customers and went out of business in about a year.

Conclusion

Buying a business is a complicated, emotional process. By avoiding these costly mistakes, you can prevent turning your dream into a nightmare.

About the author:
David E. Coffman

Q: I own a small decorating business and I’ll be the first to admit that I don’t know anything about taxes or retirement plans. I’d like to set up a 401(k) or an IRA or some other kind of retirement plan for me and my three employees. What are the various retirement plan options available for a small business owner and in your opinion, which would work best for me?
– Wanda S.

A: Wanda, I appreciate your confidence in my humble opinion, but asking me for financial advice is like asking Donald Trump for a recommendation on hair care products. I can tell you what works best for me and my business, but you’ll need to do your homework and seek professional advice to figure out what would work best for you. As a side note, I hear that Donald Trump is coming out with his own line of hair care product soon to be called “Big Head.” The formula is 1ousse, 1iquid nails, and 98
ot air. It should be a big seller among the high brow, comb-over crowd.

Here’s my best advice on retirement plans: find yourself a financial advisor (or financial planner) who is has experience working with small businesses and have him or her explain the options available and make a recommendation as to the type of plan best suited for you and your business. When I say “financial advisor” I’m not talking about your know-it-all brother-in-law or your accountant. I’m talking about a broker or financial planner (or other licensed professional) who has a proven track record of making his clients money and is an expert on IRAs, 401(k)s, mutual funds, etc.

The best way to find a good financial advisor is to ask for referrals from your most successful friends and associates. Find the richest, stingiest man in town and ask who his advisor is. Meet with several advisors, explain your situation, and ask for their recommendations. You should also make sure the advisor is a good fit for your personality and your business. If all goes well you will be doing business with this person for many years to come, so make sure the relationship feels comfortable to you and that you are confident in the advisor’s ability to manage your money.

Let me give you a quick overview of a few of the retirement plans available to small businesses so you at least have an idea of what’s out there before you start your search for a good financial advisor.

As a small business you basically have three types of retirement plans that you can take advantage of: the Self-Employed 401(k); the Simplified Employee Pension Plan or SEP IRA, and the Savings Incentive Match Plan for Employees or SIMPLE IRA. Each allows you to make pre-tax contributions to the plan, which lets you save for retirement and lessen your taxable income by the amount of the contribution. Your investments also grow tax-deferred until withdrawal.

A Self-Employed 401(k) is an option for self-employed individuals or business owners with no employees other than a spouse. The business can be a sole proprietorship, a partnership, or a corporation, including S corps. You can make salary deferrals to this type of plan of up to $14,000 for 2005.

Next is the Simplified Employee Pension Plan or SEP IRA. A SEP is an option if you earn a self-employed income from a full or part time business, even if you are covered by a retirement plan at your fulltime job. A SEP allows you to contribute up to 25f earned income, up to $41,000 for 2004 and $42,000 for 2005.

My preferred type of retirement plan is the Savings Incentive Match Plan for Employees or SIMPLE IRA. The SIMPLE IRA was created to make it easier for small businesses with 100 or fewer employees to offer a tax-advantaged, company sponsored retirement plan.

With a SIMPLE IRA you and your eligible employees may contribute up to 3f earned income (with a maximum contribution of $10,000) on a pre-tax basis to individual SIMPLE IRAs. You must deduct Social Security and Medicaid from your gross income, but you can then make your SIMPLE IRA contribution before other taxes are levied, effectively lowering your taxable income.

As the employer you must make “matching” or “non-elective” contributions into your employees’ SIMPLE IRA accounts. Matching contributions means that the business matches the elective deferral contributions made by employees. For example, if the employee opts to contribute 3f his salary to the plan, the employer must match the 3ontribution.

At first you might cringe at matching your employees’ contributions, but as the business owner and an employee yourself this can be great news. As an employee of your own business you can contribute up to $10,000 to your SIMPLE IRA and the business can then match your contribution dollar-for-dollar, which means that you can put up to $20,000 in tax free dollars into the plan per year. The cost of the contributions is also deductible as a business expense.

The non-elective contribution option requires that the company contribute 2f every employee’s earned income to the plan on the employee’s behalf regardless of whether or not the employee contributes to the plan himself. For 2005 the maximum contribution you would be required to make is $4,200.

Like a traditional IRA, you can withdraw money from a SIMPLE IRA at any time; however distributions within the first two years of participation are subject to higher early withdrawal penalties than traditional IRAs or Roth IRAs. Withdrawals within the first two years are subject to a 25arly withdrawal penalty. Withdrawals taken after the first two years are subject to a 10arly withdrawal penalty.

As the employer, the advantages of a SIMPLE IRA include: company contributions to the plan are tax deductible as a business expense; plan documents are simple and easy to administer; administration costs are low; and there is no government reporting required by the employer.

The advantages of a SIMPLE IRA for your employees include: contributions are immediately 100ested; contributions and earnings are tax-deferred until withdrawal; employees can contribute 100f earned income up to $10,000 for 2005; and employees can direct their own investments within the IRA.

This is a complex topic and I’ve just tipped the iceberg here, but hopefully this will give you enough information to get the investment ball rolling.

Here’s to your success!

Tim Knox

About the author:
Tim

Why do so many people claim that money isn’t important? Why is there this notion that wanting money somehow makes you an ill adjusted bad human being? It’s such a strange thought pattern don’t you think?

Wanting more money in your life doesn’t mean you’re a bad person. It doesn’t mean you’re greedy either. It just means you want more out of life. You want more freedom. You want more security. You want more fun. Whatever it is, you just want more. Money is just simple a means to that end.

I hoe I don’t let the cat out of the bag, but that’s what this whole home business gig is anyway. Someone sells you on the idea that you can make tons of money working from home as an independent contractor or distributor for this company or that. And, it’s not that you ever buy into the promise that the home business is selling, but you take a leap of faith and give it a try.

We start small, maybe $20 for a book about real estate investing. I know my first brush with the thought that I could be independently wealthy working from home was when I came across an ad for the ebook Googlecash (if you don’t know what I’m talking about just do a quick google search). The idea seemed so easy and so low risk I figured why not give it a try.

That was the beginning, almost a year ago. Here I am now writing to you about my home business experiences. In that time, I’ve bought an apartment building and learned just about everything there is to learn about starting and running a business from home. And guess what? If you haven’t caught on to this yet, no matter what the ads tell you, no home business is as simple or as cheap as the ad would have you believe. But I digress.

Let me get to the point though. Let’s discuss the title of this little article. Most millionaires become millionaires by starting a small business, saving their revenue, and then investing. It really is that simple. Let me say that again, all you have to do to become a millionaire is start a small business, save, and invest.

So, what do millionaire look like? Well, most are in their sixties and living the same type house that you and I live in. They look like us. They dress like us. They are us. The only difference is they have a whole lot more money in the bank.

Here’s a fact that I hope will hit home. There are twice as many millionaire small business owners than there are millionaire doctors or lawyers combined. So, if you own a home based business or you’re thinking about checking out some legitimate home based business opportunities then your on the right track. Just stick with it and don’t give up!

Remember most millionaires are get to be millionaires by being just like you and me, they’re home business entrepreneurs!

About the author:
Daegan Smith

To succeed in today’s crowded marketplace where most of the products and advertising look exactly the same, a small business owner must stand out, shouting above the din with a message so clear and compelling that prospects stop and take notice. It’s a matter of business survival. Unfortunately, most entrepreneurs quickly retreat to the supposed security of sameness, soon to be lost in a sea of anonymity and a tidal wave of frustration. In effect, albeit at a subconscious level, they are saying , “I don’t want to be different”.

In back room offices and store fronts everywhere, salespeople are telling business owners they should do this or that kind of ad because it worked so great for their competitor. The owners nod and sign on. It’s already proven to be a winner, right? WRONG! Change the name, background color and a font style and you’ve got sameness. Put those ads in the yellow pages, a coupon magazine or a TV commercial cluster and you’ve got advertising death. Want proof? Ask a small business owner how well their advertising is working. Don’t stand too close waiting for the answer.

To make your advertising work, follow the principle if your competition is doing it, don’t. Go where they aren’t and win the battle without a fight. Resist the urge to get a listing in the phone book because that’s where everyone else is. A coupon direct mailer that features 6 or 7 of your competitors is a poor choice too. Look for new opportunities in direct mail and email campaigns. Look at direct response ideas. In short, try to find the biggest number of clients you can find in one spot. Fish in a barrel, not the ocean.

When you’ve chosen different channels to attract your customers, make sure you overcome the “so-what” factor in your copywriting. An ad for a heating and air conditioning company that says it has certified technicians that will fix your problem quickly is a so-what line. No one is looking for uncertified slackers that will get around to the problem whenever. A moving company that mentions superior insurance coverage makes you think they’ll probably break something. Be creative and write copy that will compel prospects to take action.

Consumers are bombarded by thousands of ad messages every day. There is so much overload they tune everything out. To get their attention, look within your business and find all that you do differently and decide which of those elements your customers most want. Decide how to word it best. and where to position it. Decide you really do want to be different. You have to. Your business depends on it.

About the author:
Brian Grinonneau

Do you ever wonder if you will really succeed with your
small business? You may have a number of special traits, but
how well developed are they? There are qualities of endeavor
and achievement that are common to successful business
owners. Ask yourself these questions to see if you have what
it takes.

1. How will the business affect your family? The first few
years of business start­up can be hard on family life. The
strain of an unsupportive spouse may be hard to balance
against the demands of starting a business. There also may
be financial difficulties until the business becomes
profitable, which could take months or years. You may have
to adjust to a lower standard of living or put family assets
at risk.

2. How will you support your family while building up your
business? This question must be worked out according to
each persons’ individual circumstances. Many people start
out on a part-time basis. Then when their incomes reach a
certain level they will switch over to full time. Granted,
if you take this “safer and surer” approach, it may take you
longer to reach the goals you set for your new business, but
you will save yourself (and those who depend on you
financially) a lot of anxiety. Ultimately, like the turtle
in the race who moved ahead slowly yet steadily, you will
have a greater chance of reaching the finish line.

3. How well do you get along with different personalities?
Business owners need to develop working relationships with a
variety of people including: customers; vendors, staff;
bankers; and professionals such as lawyers, accountants and
consultants. Can you deal with a demanding client, an
unreliable vendor or cranky staff person in the best
interest of your business?

4. How good are you at making decisions? Small business
owners are constantly required to make decisions under
pressure.

5. Do you have the physical and emotional stamina to run a
business? Business ownership can be challenging and
exciting. But it is also a lot of work. Can you face 12­hour
work days for six or seven days a week?

6. How well do you plan and organize? Research indicates
that many business failures could have been avoided through
better planning. Good organization of: financials;
inventory; schedules; production; can help avoid pitfalls.

7. Do you have the drive to maintain your motivation?
Running a business can wear you down. Some business owners
feel burned out by having to carry all the responsibility on
their shoulders. Strong motivation can help to survive
slowdowns, as well as periods of burnout.

8. Do you have the discipline to do what has to be done?
When working for someone else, it becomes routine to rise
early, be well-groomed and get to the office on time.
However, a significant number of people starting up a small
business at home all too often find themselves at 10:00 in
the morning in their bathrobes, drinking a second or third
cup of coffee.

Make no mistake, starting a successful small business is
hard work. BUT, it is also highly rewarding! Attack the
challenge head-on and success will be yours.

About the author:
Michael Brassil