Monthly Archives: January 2017

Should Know About 4 Signs It’s Ready for the Next Level

As a business owner it can be easy to think it is time to grow to the next level when you are overworked, running out of space and sales keep coming in. However these are not signs your business is actually ready to grow. The real signs that your business is ready for the next level has more to do with ensuring everything is in place for that growth to be sustainable.

When the seeds for growth are planted without the right foundations in place, future problems can impact profitability, culture and possibly even cause business failure. The following four issues are the real signs your business is ready to move to the next level without complication.

Corporate Structure & Financial Management
Having the right legal and financial structure in place is important to ensure that you and your business are protected while at the same time giving you the financial data to make smart decisions.

An example of legal issues to consider would be if you started out as a sole proprietor and grew the company to the point where you needed to add employees. At that point it may be prudent to consider the framework of your organization and create a Limited Liability Corporation (LLC) or Corporation. Or perhaps you are an LLC and are nearing the point where you are considering going public. If this is the case you may want to convert to a corporation. The structure you select will impact what types of capital you have access to, how you run your financials and how much personal financial protection you have.
Financial management required a keen understanding of your accounting. If you have never paid much attention and look at the accounting as more of a requirement than a helpful task, it is time to change your opinion. The bigger you get the more you need to understand your own accounting. It is hard to allocate capital and resources effectively without knowing how those investments will impact your profit. For example if you don’t understand what it costs to bring on and keep one customer you can quickly run up marketing costs that have garnered little to no payoff.

Revenue Model Mastered
Figuring out what your revenue model should be for maximizing profit can be a blend of art and science. While this does continually evolve over the life of the business, you want your current revenue model to be performing for your business today. If you are still trying to figure out how to maximize revenue at your current level, it would be wise to figure out how to maximize revenue before growing further.

For example if you are currently billing customers by bidding projects that are a flat rate but you never estimate your hours correctly, growing will only add more hours you don’t bill. More staff will only create more of a gap in your project profitability because you have more employees doing more work that you are not billing. The more you can’t or don’t bill, the lower your margin goes. Slowly you will lose profitability even with more business revenue because you have not mastered the model you are charging under.

Good Systems in Place
Without good IT and other systems in place a company that starts to expand will have problems with their quality of service or product. Additionally a lack of good systems can cause problems within your corporate culture. Staff can become frustrated. They may not know what to do or have the tools to do their job the right way, leaving the atmosphere stressed and defeated.

As if that were not bad enough, a lack of systems also makes it extremely hard to sell the company if you ever want to. Instead of having a documented process for how the company operates you have everything in your head. Unless you are staying on at the company you can’t sell a business that is 100% reliant upon you. Systems can include everything for the process your sales teams use to close a deal, onboarding new hires or how a product is created.

Have a Growth Plan
Before you grow you need a strategy for the growth. You may end up pivoting away from your original plan as you grow, but a lack of any plan will prevent you from building your business in a direction that you actually want to go. It can be tempting when you are over run with work to go out and hire someone, but if you don’t hire someone for things you need to delegate, you are making more work for yourself without removing some of your responsibilities. A growth plan should include how you are going to allocate your capital to grow, what your staffing plans are and how you are going to manage the growth on a day-to-day basis

Best 5 Incentives For Student Startups

So, you’ve been bitten by the entrepreneurial bug in college and you think that you’ve got the next big business idea? Then it’s time to stop making excuses and start making money! When you get right down to it, the benefits of starting a business while you’re still in college far outweigh the detractors. Need more convincing? Here are five reasons why starting early can work for you.

1. Because You Can Now!
The examples are all around us – Facebook, BustedTees, Google – businesses that were started by college students are hitting the big time. Now, more than ever, technology has made it possible for people to start a business with very little capital if they are willing to invest the time.

In addition, many colleges and universities offer programs and incubators that can help fledgling campus companies grow. The Collegiate Entrepreneurs’ Organization is just such a program, which provides things like networking and leadership training to thousands of students worldwide.

Student entrepreneurs can also get business input by participating in business plan competitions; they take place at many schools and often offer seed money and guidance to students with the winning business plan. To find out whether your school offers a business plan competition, check with your career services department.

2. What Do You Have to Lose?
As a college student, you’re probably used to living on the cheap. One of the biggest obstacles in the way of starting a new business a few years down the road is the question of “who’s going to pay the bills?” It’s a whole lot easier to get into a new venture when you don’t have extra bills to pay or mouths to feed, so why not take advantage of it now?

Another concern is that the business won’t succeed and you’ll lose your investment. From an investment standpoint, now is the best time to place a risky bet! When putting your own money on the line, the risks only get bigger as you get older. That’s because the younger you are, the longer you have to earn it back. It’s easy to understand why a 46-year-old with two kids and a retirement to plan for might be a bit squeamish about dropping his or her nest egg on a new business. As a college student with a whole career ahead of you, you may have the best opportunity yet.
3. Professional Experience and Networking
Would you believe that even if your business turns out to be a flop, it could still make you money? Starting a business can lead you to professional contacts that could help you close deals, land jobs and make money in the future. As an entrepreneur, you’ll deal with suppliers, clients, other entrepreneurs and maybe even journalists – people with whom you probably wouldn’t otherwise get the chance to connect.

Starting your own business in college might also land you a job with an employer you’ve never met. When they see that you have a startup on your resume, employers are going to see a candidate who is hard working, ambitious and the all-important “self-starter.” Even if your business doesn’t work out as you’d hoped, it could still be great fodder for an interview. Also, if you gained valuable skills from your business – not many looking for a first job have management experience, for example – you can use to them boost your resume.

4. Perspective
We live in a world where information is more available than ever before. Nevertheless, you might be shocked to find out how much you don’t know about the world. Starting your own business could give you a perspective that four years of college can’t provide. Typical people working typical jobs only see certain facets of the business world, but as an entrepreneur, you’ll be exposed to everything, including finance, marketing, product development and customer service. Yes, this stuff looks good on a resume, but it can also give you a competitive edge in real life, off paper.

5. Marketability
College students have one thing that many Fortune 500 companies would kill for: the ability to get into the heads of the coveted 18- to-24-year-old demographic. That’s right, the fact that you’re young can actually give you a competitive advantage! The trick is to tap into that power.

By the time many people get around to starting a business, they’ve missed the boat on catering to this age group. Because today’s 18- to 24-year-olds have money and know-how, and are ready to “evangelize” about the products they like, these people are a valuable group to get on your customer list. Having a portal into this demographic could be just the thing your campus-born business needs to get off the ground.

That portal extends to your own backyard as well. Recruiting a select group of college peers with the right mix of smarts and curiosity could be just the boost your company needs in order to be successful. College workers will cost less, and many have just as much technical expertise as their “real world” counterparts.

Know More About 5 Expensive Small Business Mistakes

Starting out on your own in a new small business can be exciting and, hopefully, very profitable. Not taking the time to research and prepare for the unexpected, however, could cost you a bundle down the road in legal fees, missed sales or bad publicity. Before you engage in your first business transaction, be sure you’re not at risk for any of these five costly newbie mistakes.
Not Registering Your Business
Since every state and local jurisdiction is different in what kind of businesses are required to have a business registration, your best bet for getting this one right is to check directly with the government agency that handles it in your area. The requirements can range from needing to register for any kind of business to simply needing one if you hire employees, lease tangible personal property, or charge sales tax. Not abiding by local and state ordinances can subject you to heavy fines, legal action or your business being shut down until it has met the requirements.
In addition to the registration of your business, be certain that all professional registrations and licenses are maintained, as well. If you worked for a company that handled the renewals of a professional registration (an investment advisor, for example), don’t assume that everything is current when you start your own freelance planning business. Serious personal fines and lawsuits could arise from practicing without it – regardless of whether you assumed it was handled.

Not Informing Your Day Job
Moonlighting, or the practice of starting out on your own while still working for your employer, is a popular and more increasingly acceptable practice for many professionals. In most situations, letting your boss know that you do some graphic design on the side after hours at your marketing agency, for example, isn’t a major issue. Some companies, however, will not find it acceptable, and pursuing a side business in the same niche as your day profession could land you in legal trouble.
How do you know if it’s ok to do some side work after hours? Just ask! Although your manager may not know the complete terms of your employment contract, the human resources or legal department will. Err on the side of caution, and get the details of any non-compete language before you start your own business.

Not Charging Taxes
Sales tax is an area of business that will vary from location to location. Since all but five states (Alaska, Delaware, New Hampshire, Montana and Oregon) charge sales tax on any number of goods and services, however, chances are good that you’ll be presented with the decision of if, and how, you will collect it in your online or brick-and-mortar business.
If you find yourself offering a product or service subject to taxation, be sure that you offer an easy way for it to be added on to the price of your wares. While it is ultimately the consumer’s responsibility to pay sales tax, the store or business will most likely be on the hook for uncollected amounts, so be certain to consult your attorney for any questions on how to go about doing it right – or you could face the scrutiny and penalties of the IRS.

Not Using a Unique Business Name
Thought you could get by with using a business name that is similar to a competitor’s? Think again. Copyright and trademark laws are vague at times, but one thing should be very clear when choosing a business name for your new endeavor: your business should not be named so that it causes confusion to customers as to what business they are buying from. In addition to complicated lawsuits that cost time and money to resolve, there is that matter of possibly being forced to change your business name to something ore distinctive. It is best to start out on the right foot, with a name that no one else is using.
Not Being Insured
Depending on the exact nature of your business, your insurance needs will vary. To avoid the possibility of litigation bankrupting you, however, it is always best to look into the types of insurance that leaders in your field recommend. Some types of insurance will be unnecessary to purchase, and depend more on the size and scope of your business than the niche. Other kinds of insurance can be obtained simply by increasing the limits of insurance you already have (automobile or home owners, for example). A reputable business insurance agent will have the information you need to prevent expensive liability claims from harming your business.