Business Archives - Page 52 of 52

Reasons For Selling A Business

A business sale is not a “one size fits” all situation. The details that apply in a specific situation will not all be the same. Before proceeding further, it’s important to step back a bit and look at the big picture for business sales in a variety of circumstances. Not all business sales are for the same reasons, and the circumstances of the sale can have a big impact on how a sale should proceed.

What KIND of Buyer is it?

Before considering the various sale situations, it helps to consider the KIND of buyer. In almost all cases the buyer will be either another company or an individual.

If the buyer is another company then it is likely the buyer will be able to run the business successfully. The buyer’s ability to pay may be fairly secure. Training the buyer may not be critical, but assistance with customer retention after the sale may be critical. The buyer may be more sophisticated, or at least have more sophisticated advisors. Consideration for the sale may include some form of performance based incentives (i.e., an “earn-out”).

If the buyer is an individual, training the buyer may be even more important than assisting with customer retention. Since the buyer’s ability to run the business successfully may not be as certain as it would be if the buyer were another company with a proven track record, the cash and/or collateral the buyer brings to the table may be a major factor in the sale.

The Most Common Sales Situations

These are the most common sales situations. Whether you are a buyer or a seller, one of these situations most likely fits you. Additional details applicable to each are covered later in subsequent articles.

Very Small Business – This is the most common business sale situation

Sometimes referred to as “Mom & Pops”, “Main Street Businesses”, etc.
Most of these businesses do not actually sell.
This is usually a sale to an outside individual (an “External Sale”).
Sometimes (although rarely) the sale will be to an insider (an “Internal Sale”).
It is rare to have an employee with both the interest and the ability.
The person needed can sometimes be recruited.
Can often be creatively structured as a win/win, even if the buyer has little money.

Somewhat Larger Small Business – External Sale

More likely to sell than a Mom & Pop, but many never do.
Internal Sale
Easier to structure than for a Mom & Pop, but still difficult to find the right successor.
Family Sale
The IRS has insanely complex rules designed to make sure they get all the tax revenue they think they are entitled to. Which is A LOT.
Will most likely need an appraisal to support the price.

Divorce

Often VERY contentious, with expensive appraisal and attorney fees, and the eventual price and terms set by a judge.
Can sometimes be greatly simplified with advance legal planning (such as Shareholders Agreements).

Partner Buyout

Can also be contentious.
Can sometimes be greatly simplified with advance legal planning (such as Shareholders Agreements).

Sale for Health Reasons

If the seller is in ill health but not clearly dying
Time is not as critical as for a dead or dying seller.
Potential buyers may try to take advantage of the situation.
The seller’s help with the post-sale transition may be affected.
If the seller is still alive but clearly dying
A sale planned to occur upon death can sometimes be arranged.
This has the potential to save a LOT of tax.

Seller (business owners) has passed away

The company may be in turmoil.
Can be VERY difficult to find a buyer.
Tax issues can be VERY complex.

Financially Distressed Sale

If the business is in trouble, the buyer will need to see a way to fix the problem, or a sale will not happen.
Often involves simply liquidating the assets and walking away.
May be forced by the company’s lenders.

Sale to a Large Buyer

Likely to be fairly sophisticated buyers.
Likely to include an “earn-out” as part of the “price”.
Publicly traded buyers
May involve tax-advantaged strategies involving the buyer’s stock.
Large, closely held buyers
May be easier to attract than a publicly held buyer.

Start-ups

Often done with personal funds.
If funding is from family and friends, then their ownership must be decided.
If Venture Capital is involved, then complexity goes way up.
Usually only available if the upside potential is very high.
Initial Public Offerings (“IPO’s”)
Basically, this is selling part of the company to the public in the form of company stock.
Often involves venture capital at an earlier stage.
VERY complex.

Employee Stock Option Plan (ESOP)

Very complex and expensive.
Can have significant tax advantages.
Might have motivational effect on employees.
Not as popular as initially expected when these were created.

Very Small Businesses

These businesses are sometimes referred to as “Mom & Pops”, “Main Street Businesses”, etc. Although each company is small with only a few employees, they represent a huge part of the goods and services available in our economy, and are the embodiment of the American Dream for many people.

Attempted sale of these businesses is the most common business sale situation. Unfortunately, most of the time they never actually sell. Some estimates are that only one in seven of these businesses will actually sell once they are listed for sale. Many more simply shut down once the owner decides to move on to something else.

Unrealistic expectations on the part of the seller, particularly the value of the company, are one of the reasons blocking sale of many of these companies.

The value of these companies is NOT the value of the company to the seller, which may be quite high. Instead, the maximum value is limited by the cost a potential buyer would incur to start a similar business instead. That means the value may be determined by the value of the equipment, plus something extra for the “running start” available to the buyer from buying the existing business instead of starting a similar operation from scratch.

Formal valuation approaches based on the net present value of expected future cash flow, net of reasonable compensation to the owner, often do not apply. Instead, rules of thumb based on some multiple of sales plus the value of the equipment acquired are often used. These rules of thumb have even been published in a book, theBusiness Reference Guide, The Essential Guide to Pricing Businesses and Franchises, compiled annually by Tom West and available through Business Brokerage Press and available on the web at www.bbpinc.com. (One of the authors of the article you are reading right now is one of the contributors to this book.)

It is important to remember that these rules of thumb are GENERAL rules, and may not be valid for a specific situation. It is also important to remember that these rules of thumb were developed based on businesses that actually sold. That means they are biased in favor of the most attractive businesses offered for sale. The businesses that never sell have very little impact on these rules of thumb.

Ultimately, the value of these businesses is determined just like the value of any other business: What a willing buyer and willing seller agree on. Both sides must see it as in their best interest to do the deal, or it will not happen. In other words, it must be a win/win or it will not happen.

One way to sell these businesses is to arrange an internal sale. The key to this is finding a person(s) who has the necessary skills and entrepreneurial drive. Entrepreneurs are often harder to find than the people with the necessary skills. For companies that do not already have that person, it may be possible to recruit them based on the possibility of their buying the company in the future.

Sales of this type can be arranged even for buyers who do not bring much of their own money to the table. Finding advisors who can assist with this can be challenging as well.

Somewhat Larger Small Businesses

Once a business has grown past the “Mom & Pop” size, it may be a bit easier to sell. There is no generally agreed minimum size for this, but these businesses often have ten or more employees.

Many of these businesses are only marginally profitable, and will be priced using similar methods to their smaller cousins. Those that are profitable enough will be priced based on the adjusted profits a buyer can reasonably expect in the future. The key to their sale will be the ability of the buyer to continue operating the business profitably in the future, which often means the seller will need to help with the transition.

Much of the literature on buying and selling a closely held business is focused on businesses this large or larger, and assumes the buyer will be either an outside individual, or another business. Little attention is paid to the possibility of an inside sale.

These businesses are easier to arrange internal sales for than their smaller cousins, although it is still rare to see this done. Finding entrepreneurs is always hard, and few advisors understand the issues enough to help.

Divorce

A divorce often means half the business must, in effect, be sold to the spouse who runs it. If both spouses worked in the business prior to the divorce, one of them most likely will seek employment elsewhere.

The biggest question in these sales is usually price. Terms tend to be based on asset trade-offs, with cash paid for whatever value cannot be offset by other assets. Bank financing is sought as necessary to provide the cash. Appraisals are used to establish value, with a judge determining the final result if the appraisers used by each side differ in their opinion of value.

Advance legal planning, including agreement on how value will be determined, can help simplify the process dramatically. Most owners are aware of the possible use of a pre-nuptial agreement but do not have one. Less well known is that a proper Shareholders Agreement can simplify the divorce issues, including valuation, by quite a bit.

Shareholder/Partner Buyout

Buying out a fellow shareholder/partner may or may not be a contentious process, but it is still likely to involve disagreement over value. EVERY multi-owner business should have a Shareholders Agreement (or equivalent) to address the multitude of issues that need to be spelled out in advance in this situation. How value will be determined, as well as the terms for a buyout, is just one of the topics that should be covered in this agreement.

This is a huge topic with its own article later in this series.

Sale for Health Reasons

Many sales are triggered because the owner is in ill health but not clearly dying. The seller has a very good reason to want to sell, but is not under pressure to do so immediately. These sales are very similar to any other sale for a similar business except the seller may not be able to provide as much help during a transition. If an internal sale is desired there may not be enough time to recruit key employees, and longer term planning may not be an option.

If the seller is facing a potentially terminal disease, the sale will be much more complex. Seller assistance post-sale is much more problematic, thus lowering the value to a potential buyer. Likewise, the business itself may be suffering from neglect by the owner because health matters take priority. The seller will be at a disadvantage in negotiations as well, since potential buyers may sense the seller HAS to do the sale.

Tax planning for the seller’s heirs may play a major role for a seller facing a terminal illness. The tax issues include potential estate taxes, plus potentially dramatic differences in how the sale itself will be taxed.

It is possible to plan a sale in advance, with the sale itself being deferred until the seller’s death. As a protection to the buyer, the sale generally includes a “no later than” sale date, and may include provisions for the buyer to operate the business prior to that date as well. In the right circumstances this can reduce taxes substantially, provided the sale itself is structured properly. The technical elements in the sale structure for this situation may be quite different than for a typical sale.

Financially Distressed Sale

Some businesses are put up for sale as a last ditch attempt to avoid bankruptcy or being forced to shut down. In some cases the business will go through a formal bankruptcy process, with the court eventually approving a plan to reorganize the business or mandating the business be liquidated if a credible plan to return the business to profitability cannot be developed.

If an outside buyer is sought, the potential buyer will need to see a way to fix the problem causing the financial distress, or the buyer will not buy. Sometimes this will involve buying only the profitable parts of the business, leaving the difficult parts behind. This can also lead to unexpected legal complications on both sides of the sale, so be sure to include experienced legal counsel in the process.

If no way can be found for a buyer to solve the underlying problems, or the profitable portions of the business (if any) cannot be sold separately, then the business is unlikely to be salable as a going concern. In that event the business will most likely be forced to simply sell off its assets, apply the proceeds to its liabilities, and then go away. If liabilities remain and the owner is legally liable for them, the owner may have to personally make up the shortfall.

Sale to a Large Buyer

Larger buyers are likely to be another company, often in the same industry. They generally have the ability to run the acquired business successfully, and are often more sophisticated that the typical individual buyer.

These buyers are not typically interested in “Mom & Pop” businesses. The “price” they are willing to pay is likely to include a portion of the consideration in the form an “earn-out” based on performance of the acquired company after the sale. If the buyer is a publicly traded company, the sale may sometimes include use of the buyer’s stock to help improve the tax effects on the seller, and to reduce the cash required by the buyer.

Start-ups

Starting a company is often done with personal funds and does not involve sale of part of the company. If family and friends are used to help with funding then a loan will be required, or the other investors must have some equity in the company (or both).

Internet Marketing–Various Online Business Models

There are many different methods of making an online income. In reality, they are all very similar to the business models you see in the offline world. You can sell goods and services, you can produce products for wholesale distribution, you can sell information, you can sell tools to help people in their own business model, you can sell advertising, or you can provide consulting services.

Do you see a common theme in all of these models? That’s right—to have a viable business, you have to literally provide some kind of a good or service that adds value to someone or something, either online or offline.

I think that when people think about going into business offline, they look for a need in their community and try to fill it. Online, they tend to think, OK, what can I do to make a lot of money? There is a huge difference between the two. Online, I think people really believe that if they put up a web site and sell something, the money will just come in. It is simply not an accurate thought, but I think that just about everybody has thought it at one time or another.

So to create an income online, you must meet a need, just like you would in the offline world. You meet that need by producing, developing, distributing, or brokering a product or service. That is just about it. You will never earn long-term viable income from schemes and scams, no more than a bank robber will earn a long-term viable income robbing banks.

Here are some of the basic business models you can find on the web:

1) Production model. This is a company that produces value by transforming one good into another for online consumption. An offline equivalent would be a shoemaker or a gold mining firm. The online equivalent might be the development of new software or search technology, or the development of online technology that aids in the execution of some of the other online business models.

2) Merchant model. This is a company that specializes in the sales and organizes the delivery of goods and services to an online market. This can be compared to the offline equivalent of a merchant. Some examples online are bookstores, food stores, catalog web sites and other goods and services sales organizations.

3) Advertising model. This is a company that specializes in providing the service of advertising or promotion to other online firms, for example, those firms that operate using the production or merchant model. This model charges these companies a fee to advertise the goods and services provided by the other online business models.

4) Affiliate model. This is a model that resembles the advertising model, but is different in that it focuses on recruiting many individual companies or individuals to do the advertising in a systematic and piecemeal way. Whereas in the advertising model, the advertiser is paid based on the amount of advertising distributed, the affiliate model pays the affiliate marketer when a sale or step in a sales process is completed. This step may be an online visit, a request for more information, or the actual sale itself.

5) Brokerage model. This model is one that compensates the broker for bringing together buyer and seller, usually in the form of a personal, one-on-one introduction. An example of this might be an online auction or a processor of online payments.

6) Information model. The information business model is one in which the company provides information to a specific field or niche market. This information would typically instruct another company or individual on an easier or more efficient method of performing a task, or actually teach the task or the implementation of the task.

7) Subscription model. This is an overlay model, one which is generally incorporated into one of the other models. This model would provide a good or service over a protracted period of time, and provide a guaranteed and generally consistent level of that good or service for a period of time, for example over the course of several months. Two products that fit into this subscription model might be that of online monthly video rentals or services like food or medicines which are delivered on a regular basis by commitment.

8) Utility model. This model operates in much the same way as an offline utility might operate, offering a product that has, through its use, become a necessity and is often tightly controlled. An example of an online utility model would be that of internet access or telephone service via an online network.

9) Community model. This is a business model that focuses on bringing together individuals or companies of similar interest for the purpose of developing relationships and sharing information. Two examples of the community web phenomenon are the recently created Myspace and the older online forum.

When deciding to go into business online, it is important to determine which of these business models most interest you. To which of these models are you best suited? In which of these models are you most likely to be considered an expert, or in which would you have the willingness to become an expert?

How to Start a Walking Business

Starting a hiking or walking tour business can be fairly simple, and it offers many benefits to business owners. You do not have to live near a National Park or tourist attraction to make this business work. In fact, there may be multiple hiking or walking business location opportunities right under your nose – and there may be virtually no competition!

There are also other benefits that a walking or hiking business provide, such as exercise, weight loss, social activity, animal watching or simply getting an escape from a daily routine. If any or all of these activities interest you, this may be your ideal career.

At first glance, a walking business might appear to have little opportunity with a small customer base. But think again. In a hiking business, you have opportunities to lead different types of one-day trips and even expand to week-long hiking adventures to remote locations. There is not just one target market, either. You can center your business around a certain level of hiker – from beginner to advanced. In addition, whiles some people enjoy occasional hiking trips, other hiking enthusiasts want to join a regular hiking club that meets weekly or several times a week.

Another factor to think about when you start your business is location. The sky is almost the limit. You can opt to conduct hikes or tours in one area, or you can add variety to your work schedule by exploring new areas. You can lead hiking or walking tours in cities, states or even countries. You may even want to package the hikes or walks as organized group trips – with travel and accommodations included.

As expected, the ideal person to operate a hiking or walking business enjoys the company of other people, meeting new people, spending time outdoors and exercising on a routine basis. When working with groups of people from different backgrounds, having patience and flexibility will make the job easier. If you like teaching, that is an added bonus.

Do not forget your competition. Are there other businesses in your area offering the same or similar service? Ideally, you want to lead hiking or walking tours where you do not have to worry about several other companies competing for the same customers. Less competition makes getting customers much easier.

If there is substantial competition with other hiking or walking groups nearby, consider differentiating your hikes or tours. Sometimes you can lessen or even eliminate competition simply by focusing on a different market like seniors, families with small children or people who want to lose weight.

When it comes to promoting your walks or hikes, you will use different marketing strategies depending upon whether your prospects are local or from out-of-town. Start by printing informational brochures and hiking schedules. Leave some at your city or county visitor center, chamber of commerce or parks and recreation office. City libraries, cafes and community colleges sometimes allow brochures and flyers to be displayed, and they usually attract lots of people on a regular basis. Since you will be spending your advertising dollars in the brochures or printed materials rather than ads, make sure you take time to create something interesting and intriguing enough that someone will pick up your marketing pieces and read them.

My top tip? Get advice from an expert in the walking or hiking field. I am referring to people who have owned a group hiking or walking businesses. Even meeting with someone who leads tours or group activities as a business can be helpful.

You can get lots of insider tips from experienced professionals – and they can often save you a lot of time and effort in starting your own business. If you do not know of anyone in the field, browse your local library or bookstore for start-up guides, usually written by someone who has operated a hiking or walking business before.

The Four Types of Education You Require to Become a Successful Business Entrepreneur

As an aspiring successful business entrepreneur, you dare to tread a different path to 97% of society. You seek to become rich so you can design your own life independent of your paycheck. Instead of a J.O.B. you prefer to work for yourself and be your own boss, maybe work from home or anywhere you like, and to become financially free to live out your dream lifestyle.

Whether you start a traditional business, a home based business or an internet business, Robert Kiyosaki (Rich Dad, Poor Dad and The Business School) talks about three different types of education that are required for the successful business entrepreneur. If you want to achieve this financial freedom to live your own life, you need scholastic education, professional education and financial education.

Let’s unpack those three first.

Scholastic education basically is what you get at school. In the main part, it’s about basic literacy. You are taught how to read, write and do maths, very important for survival in today’s information age. Throughout our childhood we are taught the importance of getting a good education. As adults, we are encouraged to become lifelong learners and invest in our personal development. It is pretty much indoctrinated in us that getting good grades at school, even going to university, is the best way to get a high paying job.

Professional education is what teaches you how to work for money. This type of education you can get from apprenticeship and training as well as through to your work experience. This type of education can range from apprenticeships in a trade or service to higher level training to become a doctor, lawyer, accountant, pilot, and so forth.

Financial education is rarely taught at school or at home or anywhere else for that matter! This is where you learn how to make money work for you (as distinct to you working for money as above). Most people don’t even realise that scholastic and professional education will only get you so far.

Without financial or wealth education, you may not appreciate the ‘different path’ available to you and will end up always working for the rich, not becoming rich. This is how Robert Kiyosaki’s distinguishes the two with his Rich Dad, Poor Dad concept.

However, these days if you are doing business mostly on the internet, there is, in my opinion, a really crucial fourth type of education and that is social education. So I’ll add this one into the mix.

Social education is important in any business where you are making sales and dealing with customers. But online, it’s even more important since you cannot ‘meet’ in person and much of our social behaviour relies on body language and visual and auditory cues.

Social education is about developing “emotional intelligence” towards others. It is learning to communicate effectively with people with regard to their situation, needs and feelings. It’s about active listening and empathy. It’s about connecting with a person’s highest hopes and worst fears.

Some would say that you develop the ‘sales’ skills to manipulate people. I advocate you develop social skills to match what you can offer to what people are looking for! (In that scenario, there is no need for a hard sell.)

On the internet, social education is critical to every part of your marketing, sales and support. This is because buying decisions depend so much more heavily on people’s sense of trust. Being seen as an authority and a leader builds your online credibility.

This is evident in the growing trend towards social networking and personal branding – what is termed “attraction marketing”, which is nowadays the business model of all successful internet marketers. People need to know you, like you and trust you before they will do business with you, become a customer or partner with you.

Social education is therefore one of the cornerstones of effective marketing. It teaches you aspects the psychology behind different personality types, how people make decisions, how to attract others to you, how to reach win-win outcomes, and so on.

If you spend time learning how to translate that knowledge and understanding into your personal branding, your copy writing, your presentations and your conversations, it will skyrocket your business success.

Digital Magazines: A New Way to Grow Your Business Presence

Today the Internet has changed not only how people access & use the information but also their routine. The number of options when it comes to data sources has significantly multiplied over the last few years and most of them are only a click away. The type of customer that used to be loyal to only one or two information channels has today been replaced by an enthusiastic, demanding and more updated reader expecting to get the latest information quickly.

Digital magazine delivers several advantages, your content can be assembled into publications that can;

Be Auto-update making sure the latest and most updated content is instantly available

Be Built in seconds

Be published everywhere

Be where your audience is present

Encourage a better user engagement

Enjoy a higher click through efficiency

Extract value of archived content

Improved advertising opportunities

Native Apps

Turn your readers into distributors/ editors

Introducing a digital magazine can benefit your business in several ways. They make a significant impact in your content distribution and other marketing plans on your content and the provisions of online traffic to your business.

The 6 benefits of digital magazines for your business are-

Global Audience Reach

With digital publishing, you get the benefit of reaching more readers beyond regional boundaries. It has become an influential way of retaining the interests of readers and maintains loyalty even when readers have shifted somewhere else. Readers can have access to the digital edition of the magazine.

Quick Publishing and Distribution

This type of publications helps in reaching and engaging more audiences in a short time. According to a survey, approx. 58 percent of digital magazine readers study their edition at the same day they get it.

Reduces Revenue Loss From Unsold Inventory

This publishing allows you to sell your latest issue copies without having the logistics and expense associated with unsold copies.

Better Awareness of Your Readers

For better customer satisfaction it’s very important to have a two way communication. With the assistance of e-publishing software, publishers can easily track how a reader is engaging with a digital magazine based on tracing every click. Tracked information can act like a captured data that can be used in identifying most chosen topics by the readers, and thus gives publishers the opportunity to proactively improve future publications to meet the reader’s interests.

Measure Advertising Goals

With the advancement in technologies of ad-management and ad-serving, now it’s possible to know how many readers actually clicked on the hotlink given in the advertisement. There is even flexibility to add rich media into content using sound, video and interactive links, offering the reader an experience to watch a commercial and read more about the advertiser online, simultaneously, without opening a separate window and look for the advertiser or the product. According to a survey, approx. 73 percent of people reading online journals are likely to pay attention to the ads, by either reading the content or tapping on them.

Flexibility for Magazine Content

Often, one of the limitations that publishers have to work around is an inflexible layout of content, which is usually prolonged by the total number of pages fixed for a magazine. While in e-magazines, number of content pages can be increased without reducing the text to properly fit in the expected format or changing the layout. Also, there is no extra cost for printing or paper by including more pages to the online journals.

In today’s digitally driven society, more and more people are using smartphones, tablets or other mobile devices. That’s why it’s important for businesses to adopt new changes and technologies to continue to succeed and exploit the ever-growing online world and the several benefits that it entails.

Office Supplies For The Smart Shopper How Small Business Can Save On Office Products

The overall economy is tough these days, and nowhere is the pressure greater than on small businesses. Expenses continue to rise for everything, and many companies have taken to office supplies as an area to cut costs. High dollar purchases like new printers, office desks, conference room chairs or file cabinets can easily be put on hold. However, companies need every day office products to get the job done. An office without hanging folders, copy paper, pens and Post-It notes is an office in disarray. While those costs can never be eliminated, here are some surprising insider tips as to how to reduce your costs on office supplies.

It’s common sense that most people assume searching hard for the lowest invoice price assures you of getting the lowest cost on office supplies. In fact, the actual time (therefore money), spent scouring websites, newspaper ads or retail superstores for the absolute lowest price usually costs your business more than the cost savings you see on that sales receipt. Taking advantage of that “in-store” special at Office Mega-Store so you save $.75 on a box of hanging file folders does not relate to savings to your bottom line.

Shopping tip number 1. Never have an office worker make a trip to the “Office Big Box” superstore to shop around for your business needs. There are significant hidden costs you aren’t accounting for whenever this is done. The employee salary expense for a 1 hour shopping expense is usually $12 minimum, not to mention gas, the possibility of an accident, and we all know shopping trips never take only one hour. Instead, you can easily find a trusted company with office supplies online; one who has free next day delivery and eliminates the need for costly shopping excursions.

Here’s a tangible real life example. John the new office manager makes $17 an hour, and has been given a typical order for office products – some Pilot pens, an HP ink cartridge, Smead classification folders and some Universal binders and report covers. The order total is $82, and he’s been told to find the best deal. He hits the internet and compares 3 different sites for each item taking 30 minutes. He then reviews the Big Boxes Sunday newspaper specials for 10 minutes looking for coupons. On top of that 40 minutes scouring for the best “deal”, John decides to go to “Office Mega-Max” because they had the lowest prices. A trip to the store, shopping, etc. adds another hour, (that’s conservative – driving to and finding what you need at a superstore NEVER takes an hour). So total, John spent an hour and 40 minutes trying to save you money and get the lowest prices — or $28.39! That’s 34% more than your receipt will tell you!

Now comes the biggest secret I’ll tell you. People are shocked to learn the office superstores like OfficeMax and Office Depot no longer have the lowest prices for the office products you need. Today, you can find online office supply stores who are independently owned that guarantee their everyday prices are lower. It’s free next day shipping and lower prices – that saves you money. But how do some of the better run new internet companies have lower prices than these huge corporate chains? The primary way is much lower operating overhead. The successful internet companies that Do Good Work don’t have hundreds of retail stores to maintain, all the inventory to keep, and all the employee costs to run those stores.

Some final helpful hints. You will always save money in the long run if you find a trusted supplier who gives you guaranteed low prices every day and doesn’t use price gimmicks or change their prices every week. Find a company with good customer service, one with people who actually answer the phone not a machine, and trust them to save you money and get you the products you need on time with free shipping. A big thing – never buy office supplies from an internet company that hides or does not prominently display their toll free number on the website. Companies that do good work to save you money will have personal service, easy to use websites, and some even give back to great charities.

In summary, don’t forget these simple tips to save money on the office products you need, and can’t cut out entirely during these tough economic times. The first rule is to remember employee time spent obsessing on finding that lowest price is unproductive time, and costs you money. Second, never send someone to that office superstore unless it’s an emergency. When looking at your total costs, that always costs you money. I know it’s hard to believe, but the superstores do not have the lowest prices anymore. Find and trust the right online office products company to service your needs. Of most importance to me is to find a company that does good work in the community. It helps build trust, and I’ve found a cool company that even donates 50% of their profits to great charities. They practice conscious capitalism, and it makes me feel good to do business with them. And the biggest benefit is I save money!

The reality is it’s not possible for your small business to cut out all office supply spending. Standard every day products like staples, paper clips and view binders are necessary to keep the normal work flow moving. But, if you rely on these simple hints, and search out a trusted internet office supply company that does good work, you’ll not only save time, but save money to your bottom line!

Top 7 Tips to Starting Your Business Using Virtual Business Strategies

Most entrepreneurs wanting to start a business make the mistake of using their savings, maxing out their credit cards or borrowing from family, friends or banks to get started. The reason they fall into this trap is because mistakenly they believe this is the only way they can become business owners.

It is important to understand that starting a business in this new Information Age and Knowledge Era, does not require the large funding previously needed in the old, traditional Industrial Age business model. This means the entrepreneur has the ability to start a profitable and reputable business with little to no money out of pocket.

If you are currently planning to start a business, consider the following 7 tips to start a virtual business instead of an offline one. Even if you already started a brick-and-mortar business, you can still apply these tips to your back-office operations:

Use cloud technology for all your back-office systems. In other words, use all internet applications rather than technology hosted in your PC
Set up your entire communication channels using cloud technology
Set up your entire accounting department using cloud technology
Set up your entire customer support using cloud technology
Set up your entire human resources using cloud technology
Set up your entire marketing department using cloud technology
Set up your entire sales department using cloud technology

Don’t delay starting your business because of lack of funds. Hundreds, if not thousands of highly successful virtual businesses get started everyday. In the next 5 to 10 years, all if not most businesses will be run this way. By the simple act of implementing new business model strategies from the start, you have puts yourself miles ahead of the competition.

In cases where the business owner fails to adapt to this new information age business model, the speed to business failure greatly accelerates. If you talked in today’s terms, it would be like using telex machines and telegraphs to conduct day-to-day operations.

A virtual business allows a company to be geographically dispersed. It allows it to meet and support its customers wherever they are located. Employees can work from anywhere, at any time, at any pace; all accessible, networked and coordinated via internet applications.

You can see an example of a real sustainable, successful virtual business (100% virtual and paperless) at http://groupbenefitagency.com

As you can see, with a virtual business, all you need is a computer and internet access to get you going. Anyone can start a virtual business in minutes. You don’t need major start up capital. You don’t need investors. You don’t need to risk months or years trying to break even. You don’t even have to gamble your savings. You can implement sophisticated systems. You can hire the most qualified personnel from anywhere in the world. Most importantly, a virtual business allows you the free time to have a personal life too!

Top 10 Principles for Positive Business Ethics

This morning, I read about a company using on-line auctions to defraud customers. Last week, I consulted on an ethics complaint where a business coach betrayed a client’s confidentiality. And, recently a Physician was convicted of insider trading based on information from a patient, a violation of both business ethics and her professional ethics.

Business ethics are the key to profits. If clients and customers don’t trust you, and your business ethics, they will not do business with you. Would you buy from a company you didn’t trust? Of course not!

Business ethics have become a hot-button topic. There are often ethical conflicts between making money, and doing what is right. There can be dilemmas about doing what is best for your employer, what’s best for your own career, and what’s best for the customer. Business ethics is about negotiating these mine-fields. Here are my Top 10 Principles for Positive Business Ethics:

1. Business Ethics are built on Personal Ethics. There is no real separation between doing what is right in business, and playing fair, telling the truth and being ethical in your personal life.

2. Business Ethics are based on Fairness. Would a dis-interested observer agree that both sides are being treated fairly? Are both sides negotiating in good faith? Does each transaction take place on a “level playing field”? If so, the basic principles of ethics are being met.

3. Business Ethics require Integrity. Integrity refers to whole-ness, reliability and consistency. Ethical businesses treat people with respect, honesty and integrity. They back up their promises, and they keep their commitments.

4. Business Ethics require Truth-telling. The days when a business could sell a defective product and hide behind the “buyer beware” defense are long gone. You can sell products or services that have limitations, defects or are out-dated, but not as first-class, new merchandise. Truth in advertising is not only the law, business ethics require it.

5. Business Ethics require Dependability. If your company is new, unstable, about to be sold, or going out of business, ethics requires that you let clients and customers know this. Ethical businesses can be relied upon to be available to solve problems, answer questions and provide support.

6. Business Ethics require a Business Plan. A company’s ethics are built on its image of itself and its vision of the future and its role in the community. Business ethics do not happen in a vacuum. The clearer the company’s plan for growth, stability, profits and service, the stronger its commitment to ethical business practices.

7. Business Ethics apply Internally and Externally. Ethical businesses treat both customers and employees with respect and fairness. Ethics is about respect in the conference room, negotiating in good faith, keeping promises and meeting obligations to staff, employers, vendors and customers. The scope is universal.

8. Business Ethics require a Profit. Ethical businesses are well-run, well-managed, have effective internal controls, and clear expectations of growth. Ethics is about how we live in the present to prepare for the future, and a business without profits (or a plan to create them) is not meeting its ethical obligations to prepare for the future well-being of the company, its employees and customers.

9. Business Ethics are values-based. The law, and professional organizations, must produce written standards that are inflexible and universal. While they may talk about “ethics”, these documents are usually prescriptive and refer to minimal standards. Ethics are about values, ideals and aspirations. Ethical businesses may not always live up to their ideals, but they are clear about their intent.

10. Business Ethics come from the Boss. Leadership sets the tone, in every area of a business. Ethics are either central to the way a company functions, or they are not. The executives and managers either lead the way, or they communicate that cutting corners, deception and dis-respect are acceptable. Line staff will always rise, or sink, to the level of performance they see modeled above them. Business ethics starts at the top.

Ethics is about the quality of our lives, the quality of our service, and ultimately, about the bottom line. An unhappy customer complains to an average of 16 people. Treating employees, customers, vendors and the public in an ethical, fair and open way is not only the right thing, in the long run, it’s the only way to stay in business.

Easy to Get Small Business Loans: 6 Tips for Applying for Funding for Your Company

Small business funding, unfortunately, isn’t easy to get for most people – especially if you don’t already have good credit. Typically, it requires a lot of legwork to get business loan. For some start-ups, owners often have to resort to getting a personal line of credit and using that to find the business. Easy to get small business loans really do exist, just as long as you prepare everything properly and look in the right place.

Here are a few tips to increase your chances of finding and obtaining a small business loan:

1. Get your personal credit report cleaned up. This is something that lenders will want to see. If you have poor credit, take the time to get it straightened out. You might even want to use credit repair services.

2. Create the best business plan possible. Consider this to be your “sales pitch” to funders. If you want as much money as possible from a lender, you can’t be secretive. You must specify exactly why you need the money, how much you need, and what it will be used for.

3. Keep everything as organized as possible. A wide range of documents may be required, including tax returns, annual revenue, and bank statements. Know which documents a potential lender will require from you ahead of time.

More Tips for Easy to Get Small Business Loans

4. Determine the best type of lender. There are many types of organizations that offer easy to get small business loans, including banks, online lenders, non-profit micro-lenders, “angel investors”, credit card companies, and more. Use a bank when you already have good credit and can provide collateral. Use online lenders if you lack collateral and need the funding as quickly as possible. A micro-lender might be ideal when you have a company that is so small that it doesn’t qualify for traditional funding.

5. How long have you been in business? If your company is under one-year old, you’ll have difficulty If you have a start-up, consider solutions such as personal loans, angel investors, or even online crowd-funding if you can come up with an innovative marketing message.

6. Find out how much the payments will be and make sure you will absolutely be able to pay them. Different lenders have different terms and different interest rates. You might be required to pay just one time a month or two times a month.

If you need a fast business loan, US Business Funding is a great place to start your search. This site has been featured in publications such as Forbes, Business Insider, CNN Money, and other such organizations. US Business Funding reviews are primarily positive.

What Is Net Neutrality and How It Can Affect Your Business

The subject of net neutrality has been the topic of many discussions on the U.S. forums and discussion boards since long now. To first understand why many businesses are so upset about the subject, you have to understand what net neutrality is.

What is net neutrality? According to an article in Business Insider, net neutrality prevents Internet providers from dictating the kinds of content users would be able to access online. Instead, Internet providers are required to treat all traffic sources equally. Why is this topic so controversial that the U.S. Court of Appeals had to weigh-in? Because Internet Service Providers (ISPs) like Verizon, AT&T, and Comcast want to charge for use of their networks. Meaning, these providers will have the ability to pick and choose what consumers see online and to then charge content providers.

The internet speed is basically a fixed sum game. If your competition can afford to pay to drive on the fast lane, then by default your small business gets put in the slow lane. The deeper the pockets of the company, the more competition they can speed past on the way to new customers. Right now many small bloggers and start up websites are afforded the exact same opportunity to reach an audience as the big corporations. However, it is important that you understand what net neutrality is and how it can affect you. When you boil it down, net neutrality means that all data is equally accessible via the Internet. This means that regardless of whether you are a small accounting firm or one of the big name international firms, you have equal access to placing information and accessing other information via the web. You must also factor in things like advertising and marketing budgets to get the word out, but in terms of accessibility, you’re on a level playing field with the big dogs. If net neutrality goes out the window, so does that equal accessibility. Some things to consider:

Paying More For Better Access:

No net neutrality means that Internet service providers (ISPs) will be able to create tiers of accessibility, meaning they can start demanding more money for better accessibility. Smaller businesses with tiny budgets won’t be able to compete for access with the larger companies who can afford to pay the new fees. It also means that there’s nothing to stop big companies or competitors from paying ISPs to slow access to other sites, thus effectively putting them out of business.

Limited Access to Content:

ISPs will be able to limit what you have access to base on their own corporate interests. From Business Insider: “For example, Comcast would probably like to promote NBC’s content over ABC’s to its Internet subscribers. That’s because Comcast and NBC are affiliated. But net neutrality prevents Comcast from being able to discriminate, and it must display both NBC’s and ABC’s content evenly as a result. That means no slower load time for ABC, and definitely no blocking of ABC altogether.” If net neutrality is gone, there’s nothing to prevent corporate discrimination like this, meaning your window shopping for vendors may be limited to just those on Rodeo Drive. Your favorite information sources may not be as fully available to you as they are now.

Limited Access For Potential Clients:

While the previous example explained how you would be limited in what you could access (potentially increasing costs for your business as your options dwindle), it works the other way as well. Prospects will now have a harder time finding you as well. Entrepreneur likens this to when you buy cable TV: “Instead of being able to sell to anyone with an internet connection… entrepreneurs would find their customers limited to those who paid for the ‘internet package’ that covers access to their particular website. It would be like your cable TV plan: The more you pay, the more channels you receive.” In essence, your clients may only be directed to window shop Rodeo Drive and not realize there are more efficient and equally effective options like you out there.

Slower Load Times:

So let’s say ISPs don’t altogether block access to those sites that aren’t part of their approved network. That doesn’t mean they won’t try to incentivize you to visit their preferred sites. They can do this by interrupting streaming or slowing load times on websites that don’t pay a premium. The speed and reliability of a site can make or break you. Admit it, you’ve just decided to leave a page when it took more than a couple of seconds to load. That impatience is universal and could affect traffic on your website. And if you wanted to engage in video marketing and stream on your website, you might be up the creek without a paddle (slowly, very slowly drifting).

Leveraging Video Marketing:

SMBs that depend on video (such as YouTube, Netflix, etc.) as part of their marketing strategy could be impacted if net neutrality is eliminated. For instance, if your company streams videos to homes across the country, or if you want customers to view your company’s product videos, then there’s a probability you might be affected. Similarly, if SMBs can’t afford to pay ISPs to share their content, their prospective customers may be unable to view the product videos and may not be enticed to purchase their products. Moreover, the investment on producing and optimizing the videos will result in a financial loss. The FCC decision, thus, could have an impact on your SMB and how you are able to access the internet in the future.

As a small business owner, it’s important to understand net neutrality. The decisions being made could possibly have an impact on your small business and how you are able to access the Internet in the future.