How to Launch a Local Business in Your Community
Have you always wanted to be a business owner? You’re not alone! Research shows that two-thirds of Americans want to open a small business. Launching a local business is a fantastic way to realize your entrepreneurial dreams and support your community at the same time. Unfortunately, fear of failure is one of the biggest obstacles holding people back from becoming their own boss. And this is justified. Launching, running, and growing a business is a major undertaking—and one that does not come without its share of risks.
That said, you shouldn’t let fear deter you from chasing your dreams! There are a number of steps you can take to ensure you enjoy success as a local business owner. To help you get your bearings, VR Business Sales presents the following guide packed with great tips and resources for prospective local business owners like you!
Small Businesses Benefit Local Economies
Did you know that small businesses make up 99.9 percent of all businesses in the United States? These small businesses create over a million jobs every year! Unlike major corporations that funnel money out of local economies, small businesses contribute to local communities by keeping money close to home. Small businesses also better understand the needs of their community because they are incredibly customer-oriented. As a result, local customers are more likely to remain loyal during tough times, like the current coronavirus pandemic.
Investing in Business Training
So, you’re ready to launch a local business. But where do you start? Pursuing an education in business is a great way to get the ball rolling on your new venture. While a degree isn’t required to launch and run your own business, it can certainly help you get ahead. The skills you learn in school will help you run your business efficiently—and legally—so you can minimize financial hurdles and time-wasting roadblocks. As Home Business Magazine explains, continued education will enable you to create valuable professional connections, inspire your employees, avoid burnout, apply your knowledge, and stay up-to-date with industry trends and innovations.
If you want to sharpen your business skills, consider attending university and enrolling in an MBA program. Online schools make it easy for business owners to pursue an education on the side, so you don’t have to postpone your business launch to get the training you need. A great MBA program will teach you everything you need to know to become an impactful and effective business leader.
Accessing Small Business Resources
Funding issues are some of the biggest obstacles facing new business owners. Luckily for you, small business owners have access to a wealth of funding and educational resources through government programs and nonprofit organizations. Start by joining your local Small Business Administration (SBA) for loan and grant information, free classes, and local resources that can help you navigate the launch of your business and keep things running smoothly as you explore new growth avenues.
When to Hire Help
As you get your business up and running, it can be tempting to try to do everything yourself. While you can save a lot of money with the DIY approach, you can also waste a lot of precious time this way. Sometimes it’s worth it to pay a professional to help you out! This is especially true for tasks that fall beyond the limits of your skillset, whether it’s website development, graphic design, writing, marketing, or social media management. Hire freelancers or employees who can help shore up your weaknesses and give your business a competitive advantage.
Managing Employees
When it comes to the actual logistics of running a business, most first-time business owners struggle with effective employee management. Running a team is a skill that takes time to master. Be prepared to make mistakes and learn from your experiences on the job. With that in mind, there are a few ways to simplify things. For example, you can easily streamline your payroll process with the help of specialized payroll software. You can also find software to help you track employee performance, onboard new hires, schedule shifts, and keep your workforce engaged. Your employees are your most valuable asset, and you want to do everything you can to keep them happy.
Building Your Community Presence
Running a local business is all about building and maintaining a local presence. Many small business owners hold onto a “build it and they will come” mentality. But the truth is that if you don’t get out there and market your business to your community, you won’t be able to compete with the established businesses already offering similar products and services to your target audience.
To run a successful local business, you must focus on your local presence. Attend meetings and trade fairs to build relationships with others in your industry, nurture connections with people in your local SBA, and participate in local festivals to promote your business and engage consumers. You could even sponsor a local event or pitch an idea for a cross-promotion with another local business. There are so many ways to get involved in your community, so don’t sit back and wait for customers to find you via word-of-mouth. Get out there!
If you’ve always wanted to become an entrepreneur, launching a local business is the best way to go about it. Building a local business will benefit you and your neighbors by creating jobs and keeping money in your economy. The best part? You get to be your own boss and make the calls! Increase your chances of enjoying success with your small business by taking the time to do everything right, from meeting legal requirements to managing your employees.
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How To Manage the Financial and Administrative Aspects of Your Business
For many business owners, bookkeeping is an onerous task. However, it is one of the most important aspects of keeping a company afloat. In fact, the most common reason for a business to fail is a cash flow issue. A proper accounting system helps business owners keep up with income and expenses in real time so that adjustments can be made before a cash flow problem becomes disastrous. Fortunately, there are many options to make bookkeeping and accounting easier for business owners. VR Business Sales presents some tips and resources to help you manage this aspect of your business.
Try DIY Bookkeeping
For those who choose to do their own bookkeeping, it is important to understand the special taxes imposed on businesses, including payroll and sales taxes. Research the tax implications for your business structure (i.e., LLC, sole proprietorship, partnership). Once you are familiar with all of the financial aspects of running the business, you can begin devising a bookkeeping system that meets your needs.
Your system will include important elements such as billing software and payroll software. When selecting software to handle billing and payroll, research the features of the product and make sure they match the needs of your business. For example, many business owners choose to have the payroll software automatically fill out tax forms and e-file them. Others need checks to be direct-deposited into employee accounts automatically. A timesheet calculator is also a handy tool.
Many businesses also need a system for tracking inventory. Square notes that one of the most integral parts of your business is inventory management, mainly because of the importance of evaluating your business on a regular basis to ensure you’re on track to succeed. Timely assessments can also include scheduling time at least once a week, preferably in the morning or early afternoon, to do bookkeeping tasks. Trying to do paperwork when you are tired after a full day of work is likely to result in mistakes. Stick to the schedule so that paperwork doesn’t pile up.
Hire a Bookkeeper
Accounting and tax paperwork can be overwhelming for business owners, so many decide to enlist extra help. Whether you decide to delegate inventory duties to a trusted employee or hire a bookkeeper, do your due diligence to make sure that the person is both qualified and honest. Your finances are key to your business’ success, and you want them in good hands.
Make sure to check references and research any professional organizations to which the candidate belongs. When candidates are certified or licensed by the National Association of Certified Public Bookkeepers or the American Institute of Professional Bookkeepers, it’s a good indication that their knowledge and skills are up to date.
Consider hiring on a provisional basis for a short-term trial to ensure you are satisfied with the work. You should be able to see all the data and reports at your request, and the bookkeeper should be able to fully answer any questions that you have. Make sure you know the passwords to all accounts so that you can access them if needed.
Stay Organized
Even if you hire someone to help with the bookkeeping and accounting duties, you still need to maintain an organizational system to keep the business running smoothly. At minimum, you need a way to get documents and information to your bookkeeper securely and quickly so they can file it away.
If you do not have a bookkeeper, devising the organizational system yourself may feel overwhelming. Keep the system as simple as possible while still being effective. Whether you keep paper or digital records, make sure everything is labeled and that all documents are filed promptly.
It’s important for business owners to keep a close eye on financial transactions and stay current on paperwork and payments. A solid bookkeeping routine and organizational system can ensure you know how your business is doing at all times, making it easier to course correct if necessary.
VR Business Sales specializes in business sales, mergers, and business intermediary services. Call us today at (813) 260-3127 or email info@vrsouthshore.com.
Cameron Ward is an entrepreneur and an MBA student. She created bizwealthbuilder.com to provide insight and advice to those who aspire to succeed in owning a business. The website provides business budgeting and funding information to help business owners streamline their financial management through easy-to-implement processes and platforms so that they can stick to the business of running their business
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Do You Need an EIN? Exploring the Benefits of an Employee Identification Number
You have done your homework. You’ve set up your location, found a funding resource, and even drafted a decent business plan. Now you hear that you need an Employee Identification Number, too. An EIN represents an important step in your business startup.
As you learn more about the Employee Identification Number (EIN) — otherwise known as a Tax ID Number, — it may be helpful to understand what it is and why having one is important for your business.
Dreaming of owning your own business? VR Business Sales can help you find the right business and navigate the purchasing process. Call (813) 260-3127
What is an EIN?
Like a social security number, an EIN number is a nine-digit designation given to businesses by the IRS as identification for tax purposes. Businesses that have an EIN and are formed as a Limited Liability Company (LLC) have added protection from being sued as the company, in effect, has its own social security number.
It is free to obtain an EIN, and it can offer a lot of worthy benefits. Even if an organization isn’t a business per se, it can be practical to establish an EIN. Volunteer groups, scholarships, and even churches can file an EIN to simplify tax prep. Having an EIN can help not-for-profit organizations accept donations more easily. So whether you are a small business owner or just getting your organization started, filing for an EIN can be practical and will simplify your life.
Why Would I Want an EIN?
Obtaining an EIN can offer many benefits as you file your business taxes. In some cases, filing your taxes with an EIN can help you avoid an IRS audit, particularly if you have claimed home exemptions. By getting an EIN, you may also avoid identity theft. It is risky to use your social security number on all your business forms, but using your EIN can reduce the risk significantly.
Hiring employees is far simpler when you have an EIN, and it is easy to initiate a payroll program with this already established. In some cases, acquiring business loans is easier when you have an EIN. Think of an EIN as a sort of business passport — it enables you to navigate varying aspects of the startup world with a document that shows your validity as a business. It is a way to identify yourself and show a credential that essentially states: “My business is legit.” Not all businesses need an EIN, but you can apply for one, even if you are not required to.
Finding Out If You Need an EIN
Some businesses, such as corporations and partnerships, automatically need to apply for an EIN due to the nature of their startup, while others do not. It largely depends on the nature of your business. Sole proprietors do not need an EIN, nor do LLCs without any additional workers. When an LLC hires employees, the rule changes and you will need an EIN.
IRS.gov offers a simple six-question yes/no form that can clarify if your business needs to obtain an EIN. If your business does require one, it is an easy process but may take several weeks to complete. Startups can benefit from applying early on to avoid any delays during opening day or acquiring funding.
Your startup will benefit from obtaining an EIN. The process is simple and can offer a range of practical uses from enabling donations to facilitating tax prep.
Cameron Ward is an entrepreneur and MBA student. She created BizWealthBuilder to provide business budgeting and funding information. She hopes it would help business owners streamline their financial management through easy-to-implement processes and platforms so that they can stick to the business of running their business.
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The Importance of Owner Flexibility
You shouldn’t expect to sell your company overnight. For every company that sells quickly, there are a hundred that take many months or even years to sell. Having the correct mindset and understanding of what you must do ahead of time to prepare for the sale of your company will help you avoid a range of headaches and dramatically increase your overall chances of success.
First, and arguably most importantly, you must have the right frame of mind. Flexibility is a key attribute for any business owner looking to sell his or her business. There are many variables involved in selling a business, and that means much can go wrong. An inflexible owner can even irritate prospective buyers and inadvertently sabotage what could have otherwise been a workable deal.
Be Flexible on Price
A key part of being flexible is to be ready and willing to accept a lower price. There are many reasons why business owners may fail to achieve the price they want for their business. These factors range from lack of management depth and lack of geographical distribution to an overreliance on a handful of customers or key clients. Of course, one way to address this problem is to work with a business broker or M&A advisor in advance, so that such price issues are minimized or eliminated altogether.
Be Prepared to Compromise
In the process of selling your business, you may want to achieve confidentiality and sell your business quickly and for the price you want. However, the fact is that most sellers find that it is possible to have confidentiality, speed, and the price you want, but not all three. Ultimately, you’ll have to pick two of the three variables that are most important to you.
Be Patient
A third way in which business owner flexibility can boost the chances of success is to embrace the virtue of patience. By accepting the fact that businesses can “sit on the shelf” for a considerable period of time, you are shifting your expectations. This realization can help reduce your stress level. The fact is that stressed out owners are far more likely to make mistakes.
Sometimes Losing is Really Winning
A fourth way in which business owners should be flexible is realizing that you and your lawyer will not win every single fight. There will be many points of contention, and a smart dealmaker realizes that it is often better to have a good deal than a perfect deal. You may have to make sacrifices in order to sell your company. Simply stated, you shouldn’t expect the other side to lose every point.
At the end of the day, a savvy business owner is one that never loses sight of the final goal. Your goal is to sell your business. Seeing the situation from the buyer’s perspective will help you make better decisions on how you present your business and interact with prospective buyers. Maintaining a flexible attitude with prospective buyers helps to position you as a reasonable person who wants to make a deal. Goodwill can go a long way when obstacles do arise.
Copyright: Business Brokerage Press, Inc.
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The Main Street Lending Program
There is no doubt that the COVID-19 situation seems to change with each and every day. The disruption and chaos that the pandemic has injected into both daily life and business is obvious. Just as it is often difficult to keep track of the ebbs and flows of the pandemic, the same can be stated for keeping up to speed on the government’s response and what options exist to assist companies of all sizes.
In this article, we’ll turn our attention to an overlooked area of the government’s pandemic response and how businesses can use a whole new lending platform to navigate the choppy waters.
As the pandemic continues, you will want to be aware of the main street lending program, which is a whole new lending platform. It was designed for businesses that were financially sound prior to the pandemic. Authorized under the CARE Act, the main street lending program is quite attractive for an array of reasons. Let’s take a closer look at what makes this program almost too good to be true.
This lender delivered program is a commercial loan. Unlike the PPP, there is no forgivable component. However, the main street lending program does have one remarkable feature that will certainly grab the attention of all kinds of businesses. It can be used to refinance existing debt at a rate of around 3%. With that stated, it is also important to note that businesses cannot refinance existing debt with the current lender. Instead, a new lender must be found. Generally, loans are a minimum of a quarter million dollars and have a five-year term. In another piece of good news, there is a two-year payment deferment period.
The main street lending program can be used in a variety of ways. In short, the program is not simply for refinancing existing debt. Additionally, there is no penalty for prepayment. The way the program works is that lenders make the loans and then sell 95% of the loan value to the Fed. This of course means that the lender is only required to retain 5% of the loan on their balance sheet. The end result is that lenders can dramatically expand the amount of loans they can make.
Whether it is the PPP or a program like the main street lending program, there are solid options available to help you. Businesses looking to restructure debt or put an infusion of cash to good use may find that the main street lending program offers a very flexible loan with great interest rates.
Copyright: Business Brokerage Press, Inc.
The post The Main Street Lending Program appeared first on Deal Studio – Automate, accelerate and elevate your deal making.
