Starting A Small Business And Writing A Business Plan

If you want to have your own business you should follow a few important tips. Don't start a new business without a business plan. This is one of the most common mistakes. Without a good plan it's impossible to create a successful business.

Remember that your main goal is to make money. Think who would be interested to buy your products or services. Make a plan for advertising your business. This is the first step to achieve your goal.

You business plan should include the capital you have for advertising and for the other costs. The best thing is to have the investment money from before. If a bank will loan you the money than calculate how much you need every month for it.

Make a list with all the expenses you will have and try to calculate what you would have to earn to pay them. Try to make realistic goals. If you get to the conclusion that you will have difficulties paying your bills you should reconsider. May be you
need to open a smaller business.

To be able to make a realistic business plan you could ask other people with experience. Try to find someone with the same type of business. Ask him how much profit can he make and if it's possible to pay his bills in time.

Show your business plan to your accountant. He might help you make some changes. Keep in mind that in any business there is a risk. The smartest thing is to make that risk as small as possible.

For a good business plan you also need the ability to anticipate change. Do your best to adapt your business to the client's needs. You initial business plan should be written with a pen. This way you can make changes or add new things.

To understand your prospective business you can try to work for someone else for a few months. Only after that you can make your business plan. By doing this you will gain the experience to start a new business. Try to observe what type of clients you
will have. This will help you realize where you need to focus more.

Test your product or service before you start. Try to understand your market first. If your product is well received than it's safe to start your new business.

At beginning it's better if you don't need too many people to work for you. Wait fist to see how much profit you can make. In time you can expand your business and hire more people. Choose carefully the people you will hire. They need to have good
ethical values. It's also important that they have the perfect skills for the job. Try to hire people you know and admire.

To have financial control you need to learn more things about accounting, computer software and cash flow management. All the businesses are focused around these things. Try to learn as much as possible and you will be able to control your finances better.

By John Don About the Author: Please visit http://www.ausbusiness.net/ and http://www.business-startup.biz/ for more information on this topic. Source: http://www.isnare.com Permanent Link: http://www.isnare.com/?aid=432936&ca=Business

Starting a Business? Protect Personal Assets Through Business Entity Formation

Author: Shannon Cavers

Many small businesses start as a part-time effort that grow over time, and eventually become a profit generating venture. One of the difficult questions for a small business owner is, “When do I need to form an entity?” A follow-up question is which type of entity to form such as a corporation (sub-chapter S or C Corporation), limited partnership (LP), limited liability partnership (LLP), or limited liability company (LLC).

The business person who is a sole proprietor should be aware that his/her liability is virtually unlimited. When you do not have the protection of an entity under which your business operates, it is your personal assets that are at risk. Therefore, if a party were to sue you, your personal assets would be exposed. Many states, such as Texas, offer homestead protection so that creditors cannot foreclose on an individual’s home, but such laws vary from state to state.

The formation of a legitimate business entity offers varying forms of protection for a business person’s personal assets. Entity formation is the process wherein one establishes an entity authorized to conduct business within a certain jurisdiction. In Texas, one would file entity formation papers through the Secretary of State’s office. Each state has a government office that handles entity formation. Generally, an entity can be created for as little as $50-$250 per application. Though this step often occurs later as a business grows, it is a small financial investment to make early on. Creating an entity also gives your business credibility in that you have taken the steps to define it as a functioning entity. The most common entity formed by a new start-up business is the LLC (Limited Liability Company). Limited liability companies are designed like partnerships, and therefore suitable to small businesses, but have asset protection similar to a corporation. When your entity is set up you will also receive a tax ID from the state comptroller. Therefore, you will likely have to file a franchise tax return in your state(s) of operation. You should also request a federal tax identification number (FEIN). You may want to consult a CPA to determine which type of entity offers the most tax advantages in your state.

The other component in protecting personal assets is to purchase business liability insurance. Most insurance carriers have business divisions which write general liability insurance polices. Contact your current carrier and see if you can obtain insurance this way. Additionally, you may be covered under your homeowner’s policy depending on the business you are in, anticipated revenues, and the potential exposure. Speak with your insurance carrier to find out what you need to do to protect yourself.

You can apply for the entity yourself or with the aid of an attorney. As mentioned earlier, you should speak with a tax attorney or CPA about which entity offers you the best tax advantage in your state.



Article Source: http://www.articlesbase.com/home-business-articles/starting-a-business-protect-personal-assets-through-business-entity-formation-102118.html

About the AuthorShannon Cavers is a Houston Business and Divorce Lawyer practicing in business, divorce, family law and probate. More information and articles can be found at her website at Cavers Law Firm