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Passion is the key to success.

Thu, 27 Dec 2007 13:20:00-0500

Passion is described as an emotion of intense desire. This is one of the main ingredients of success, especially in the commercial world. As much as decisions taken from the mind are encouraged and publicized in the business sector, it is this intense passionate desire that drives people to perform and succeed. Being passionate about the ultimate goal of profit making is of course present in all commercial ventures. However, having intense positive feelings for the means undertaken to achieve this goal is of consequence here. Passion for the toil involved in the money making process can act as a stimulant which facilitates performance that helps attain success. The passion level affects almost all aspects of the business. It is the vigor and steam produced by high passion levels that allows the entrepreneur to work much over the stipulated period. The desire to succeed and the passion for the work at hand results in a combination that is a sure shot formula for success. Successful people win because they love their work. The one thing common in all success stories is the passion that the entrepreneur had for the work undertaken by him/her. Be it Philip H knight of Nike, Bill Gates, Tiger Woods or any other such success story, each one chose a line of work that they were passionate about. Tiger Woods love for golf helped him play the game with ease for several hours, adding to his expertise and ensuring his success in the field. If a hobby has business potential then working towards it is highly recommended. However it is also advised to not confuse passion with a simple positive feeling for the job. Passion involves a burning desire to perform the job over and over again while a simple liking for the job will bore the entrepreneur quickly. So do not make hasty decisions. Analyze the various ideas and things that excite you. Select one which you are most passionate about then get on the job. Converting ideas into profitable working schemes takes intense planning and executing. Being passionate about the job at hand takes the toil out of it and so least stress is caused to the entrepreneur. In fact it is this passion which is most likely to see the entrepreneur through tough times. Being passionate about the job at hand spurs the business on despite its low conversion rate. The passion attracts the business person to continue putting in efforts into the business since in any case these efforts provide enjoyment to the entrepreneur. Sticking with the business and continuing to run it despite hard times helps overcome problems and get better at the game being played. Needless to say this adds to increasing the chances of success of the entrepreneur in the particular business. Irrespective of the stage that the commercial venture is in, it is likely to succeed only and only if those involved in running it are passionate about the business. Passion is the one force that must be included when planning to pave the way towards success.

Master the art of profit making

Mon, 05 Nov 2007 14:40:00-0500

Profit making is the one common goal of almost every commercial venture. Even NGO's target profit making so as to be able to further their cause with the extra financial aid earned through these profits. In fact, the difference between a successful business venture and a failed one lies mainly in the profit making ability of the former. Given that profit is the one major target which everyone in the commercial world aims at, the next step is to evaluate the various methods of making such financial gains and execute them for best results. ?Commission basis sales personnel ? Instead of regular salaries, hire sales staff on a commission basis. Commissions act as incentives, which help spur the employees on to perform. Regular salaries on the other hand allow the employee to slacken the pace of work without effecting personal income. Extra performance by the sales force translates into higher sales, which of course has an immediate positive effect on the profits. ?Regular and accurate financial statements ? Never ignore drawing up the accounts. The balance sheet and the profit and loss account are a perfect way to study the financial position of the business and understand the areas, which need attention. Identifying the problem areas before they snowball into an unmanageable crisis and taking action to prevent the situation will facilitate in the profit making process. ?Calculate cost precisely ? Whether it is cost of production, marketing, overheads etc it is imperative to calculate all of these and then decide on an appropriate sales price for the commodity in question. A sales price that does not allow room for profits needs to be reworked in order to assure a profit margin. This can only be done once the cost has been calculated accurately. ?Disembarrass non-profitable items ? Undertake a study of the profitability margins of the sales product/s. rid the system of the items that are not profitable, not only do they hinder profitability but also absorb energy which could be used for other more profitable items. ?Employ qualified personnel ? Do not hire staff that will be unable to contribute to the profitability process. When hiring candidates ensure that they are qualified for the job and will be able to add to the business activity positively. Do not hire relatives and friends unless they are completely suitable to the job profile. ?Do not mix business and pleasure ? When at work focus only on work and set time aside for pleasure later. Mixing the two usually affects the business adversely. The concept that business deals are clinched during parties and golf games is a myth. A shrewd and successful businessperson will want to check all aspects of the work before launching into it and therefore will never execute an important deal based on social circumstances. A dedicated entrepreneur will always be preferred over one who is given to merry making. ?No payroll services ? Both annual and item transaction fee has to be paid to the payroll services by companies that use them. These takes money out of the business and so avoid using payroll services completely. Instead, adopt a pay roll friendly soft ware, which will facilitate in undertaking the job in-house itself. Following some of these rules and practices can ensure that your business turns into a profit making machine.

Success In Home Business

Tue, 30 Oct 2007 13:12:00-0500

Success in a home business What differentiates a successful home business from a failed one? What are the factors that lead towards a successful home business? How should one to calculate the profit in a home based venture? Moreover, what are the most common and fatal mistakes made by people who work from home? The secret behind a successful home business lies in the answers to these questions. Though there is a fair amount of run-of-the mill information is available about making the home venture successful, there are few sources that actually give away the key success factors for a work-at-home business. Identifying a specific working area and slotting time for the work will help you organize the work better. Getting out of the pajamas will also be a step in the direction towards more professionalism. However, the key stone to building a successful home business lies in proper financial planning. The difference between home chores and home business is in the commercial essence of the latter. Therefore, while planning is necessary to succeed on both fronts it is the financial management of the latter, which is crucial. Successful entrepreneurs know the importance of commercial planning and financial documentation. Keeping of books and accounting for relevant taxes is mandatory. Most home based business owners tend to shelve this aspect and proceed to take one a day at a time. It is necessary to take into account each aspect of the entire business process. Marketing, pricing, competition, sales, taxes, cliental and several other such aspects must be planned before launching into the business. These help decide on an appropriate and financially viable choice of work. Calculating the potential profit of the proposed business will go a long way in making it successful. The scope to which your home business can expand to depends largely on these clauses. Each state has its own unique laws and working in accordance to them when setting up a home business is essential. Do not make the fatal mistake of opening a home grocery store in a residential area where commercial activity is banned. Similarly, understand that the success of the business rests on delivering to the customer. Take into account the cliental for the work and ensure that access to the product is made easy for the customer. Once the home business has been launched, do not expect phenomenal results immediately. To begin with, simply target at breaking even and then slowly work towards a profit. Do include the cost of premises and other overheads when calculating the profits. They will come in handy if planning to convert the venture into a traditional office setup at a later date. Goodwill is of immense importance in a home business set up and do not forget to calculate it if planning to sell your home business to another entrepreneur. Statistics show that the home business industry is growing rapidly and inexpensive and easy access to the internet is one of the main factors behind this growth. However, companies like Herbalife and Amway have built their empires on home businesses that do not require access to the Internet. Therefore, the potential of the home front in the commercial environment is not limited to those who are Internet savvy. The need of the hour, though, is to plan the finances of the home business and work on the aspects that emerge as potential areas of weakness.

Preparing a Budget for Your Small Business

Mon, 07 May 2007 14:34:00-0500

Working from a budget is useful for your personal finances, and even more so when you start a small business. While the word 'budget' may instantly trigger feelings of being restricted, or having to cut back on expenses, it really just means planning your spending before you do it. A budget enables you to see where your money came from, where it went, and how much was left at the end of the month. It's an invaluable planning and organizational tool, and when used properly actually lends a sense of freedom and peace of mind. Knowledge is power, and knowing exactly how your money is allocated frees you from always wondering whether you've got enough to pay the bills. More than just staying afloat, your business is in business to make a profit. Your budget reflects the financial goals of your business, and is an easy way to show how well these goals are being met. In the course of business, eventually the need for financing will arise. In order to qualify for favorable financing terms, you'll need to demonstrate that your business has its financial information in order. One item creditors will examine is your budget. Your business budget is a good indicator of how well you handle money, which in turn shows the likelihood that creditors will recoup any money they lend your business. The specific categories for a business budget may vary from those for a family's budget, but the larger headings are the same: income and expenses. Within these headings, there are separate lines for each source of income and each type of expense. The numbers in the budget must be based on reality to be meaningful ? either from past performance and expenses, or from a reasonable estimate. As a brand-new business, you'll be using estimates until you have solid figures in place. Your CPA should be able to help you arrive at reasonable estimates. As your business gains experience, you'll shift to using figures provided by the various departments in your organization. The sales department can furnish reasonably accurate income numbers based on its goals and prior performance. Also included in income are interest payments, dividends, and accounts receivable. Expenses include money paid out for office space, equipment, supplies and materials, personnel, taxes, travel and entertainment, professional fees, and utilities, to name just a few major categories. Stated simply, any money that comes in or goes out from your business should be reflected in your budget. Budgets should be prepared on an annual, quarterly, and monthly basis to ensure the best possible accuracy. For some businesses, income fluctuates throughout the year. In this case, it's especially important to hold sufficient income in reserve to use for ongoing expenses incurred during the slow season. Consistently evaluating planned and actual performance and expenses allows your business to adjust its strategies and tactics to achieve the best possible results. This continual review makes your business better able to shift its resources to focus on the revenue streams that are most productive.

Nothing Ventured, Nothing Gained

Tue, 24 Apr 2007 10:55:00-0500

If you're starting a business, you've got a lot of details to consider. What's your vision for the business? What products or services will you offer? What entity form is right for your business? What's your marketing plan? How's your revenue model look? Once all these bases are covered, you've still got a big question hanging over your head ? how are you going to foot the bill for all the start-up expenses? Some entrepreneurs start new businesses on a shoestring, raid their retirement funds, ask wealthy relatives for a family-rate loan, or apply for a small business loan. Another route is taking on a partner who's got money to invest, but who doesn't want to be involved in the daily activities of the business ? a silent partner. What they've got to offer is capital ? and specifically, venture capital. These funds are poured into a new business to get it off the ground. Because of the risk involved in funding an unproven business, venture capital generally comes at a steep price. But if you've been turned down by other traditional funding sources, the extra interest expense incurred in using venture capital may be a small price to pay for launching your business properly. High interest rates aren't the only way venture capital deals are struck. Some investors seek private equity, royalties, or higher stock dividends as compensation for the use of their money. Typically, the money is loaned for a fixed period ? often ten years. This is almost always the case when a venture capital firm is involved. Different payment arrangements might be made when the funding comes from an individual ? especially if it's a family member who's making the loan. The ultimate goal is to see the investment pay off in a substantial way, earning the investor higher than market earnings. The two business sectors currently most likely to create such a positive yield quickly are biotechnology and technology. Venture capitalists come in a couple of varieties. Some are individuals ? say, that wealthy relative, or a friend of a friend who has money to invest and is always looking for a promising business opportunity. Some venture capitalists join together to form a firm that seeks business investments. They do due diligence prior to investing, to make sure you've got every detail ironed out thoroughly. Because of the risk inherent in a start-up business, this due diligence is much more than a mere formality. Thorough knowledge about the business plan and the people who will run the business, including their education, experience, and planned involvement in the new enterprise, eliminates a portion of this risk. Venture capitalists are not interested only in seeing your business ownership dreams become a reality ? they want and need to see a profit on their investment. The risk is substantial ? venture capitalists report a close to 90% failure rate in the businesses they fund. The potential reward is equally great, and just one business that enjoys wild success can far surpass the losses from the businesses that fold.

Ease Your Tax Burden Legally

Mon, 23 Apr 2007 13:47:00-0500

Learn How To Reduce Taxes on Your Business

While there are many benefits to owning a business, small business or otherwise, there are some drawbacks just as there are with anything else. When you own a business, it can get rather frustrating when you get hit with tax after tax. Unfortunately that is one of the things that the owners of small businesses have to deal with; it costs money to make money. It is not logical to suggest going out of business to avoid certain business taxes unless your business is already operating in the red, so what do you do? There are a few strategies that you can employ to reduce the amount of taxes you pay for owning and operating your business. Businesses who are looking to reduce the amount they pay in taxes every year have two options when it comes to doing so; occasionally, people choose to take illegal routes toward easing the financial burden that business taxes place on their shoulders. That is never a good idea; the Internal Revenue Service always catches up sooner or later, and tax evasion is a surefire one way ticket to federal prison. Rather than going this route, examine the different options that you have of legally reducing your taxes. There are many different ways of operating a tax friendly business that can keep you out of jail and your business off of the chopping block. First off, being aware of your tax status is the first weapon that you have to protect yourself against outrageous taxes. Knowing your tax status and what bracket you and your business fall into are good ways of knowing what deductions and tax credits your business is legally entitled to. Also, select the business structure that best fits your purposes. Adopting an Inc, LLP or an LLC implies different liabilities and different responsibilities that entitle businesses to different tax breaks and tax liabilities. LLCs and LLPs are the best option for many businesses when it comes to tax liability. LLCs are Limited Liability Corporations; LLPs are Limited Liability Partnerships and are similar, but they have to do with a partnership, and are more often used for businesses that are non-permanent businesses, like the development of a strip mall. Inc, or C Corps on the other hand indicate a more advanced business structure, and these businesses are taxed much more heavily than any other type of business. The reasons why it is so important to select the appropriate business structure have to due with the sharing of wealth and profit, as well as risk and what things do and do not hold a company liable. If your business does not fall into any of the above categories, it is automatically defaulted to a status called Sole Proprietorship. Sole Proprietorship has its drawbacks as well, and the reason why is that it is technically considered to be a form of Self-Employment. Those who are considered 'Self Employed' are also heavily taxed; while it is not exactly the same as how C Corps status businesses are taxed, it is certainly that on a smaller level, impacting the profit of a business in very much the same way. Taxes are just one of the many drawbacks to owning a business, but the rewards are endless. Know that there are ways to improve your experience with the IRS, and many of those ways have to do with knowing how to properly classify and structure your business. Choosing the best entity for your business is just one of many times in the life of your business where you'll find the expert advice of a good CPA invaluable.

Know The Ins and Outs Of Hiring A Business Accountant

Wed, 18 Apr 2007 23:57:00-0500

It is a fact: nearly a third of the businesses who file bankruptcy declare that their reasons for doing so have to do with financial problems, usually financial problems that could have been fixed with the help of a business accountant. If you think you know enough to prepare your own taxes and take care of your own financial business dealings, chances are that you do know enough to do so; however, consider the fact that doing so takes away from a great deal of other things and other aspects of your business that you could be tending to, that using your amateur knowledge of finances and bookkeeping in general might keep you from doing. Whether or not you do have what it takes to take care of your business finances properly, it is important to know that you do not have to wear every single hat when it comes to the administration of your business, and it is okay to let somebody else handle the business side of things? Being your own accountant can create a conflict of interest that does not otherwise exist when outside sources are employed to run the financial interests of your business. Think about it; would you rather be involved in the design, the decorating, and the customer service side of your business OR would you rather crunch numbers and punch digits into a keypad all day? Whether you are just starting out in the world of business or you are just considering hiring a business accountant for the very first time, it is important to understand that there is a difference between hiring a bookkeeper and hiring an actual business accountant. It is difficult to say which is the most appropriate, as different businesses have different needs. Smaller businesses with just a few employees or even self-employment are the type of businesses that require the services of a bookkeeper. A bookkeeper will probably not oversee every financial aspect of your business, but it will oversee a lot of the finances that you would be unable to as a business owner. If you just need a little help, and can handle some things yourself, hire a bookkeeper. If you are the only employee in your business or your employee roster consists of you and just a couple other names, you should hire an accountant. If you are just getting your company off of the ground and need help getting finances and important paperwork in order, it is a good idea to hire an accountant; of course at that point it is difficult to know what type of financial state your business will be in to be able to afford the services of a bookkeeper, let alone a business accountant, but having the right help in the beginning stages can help to get you and your endeavor off to a great start. For larger businesses with more employees or businesses that have more involved financial dealings, like mortgages and building leases, payroll taxes and such, it is important to have an accountant on hand to help out with these things. Accountants are more specifically trained than bookkeepers in aspects such as this, so when it comes to more complicated situations it is only sensible that accountants are the person to go to. If you are looking at changing the structure of your business, moving from an LLP to an LLC or any other type of change in the structure of ownership of your business, it is important to understand that there are different financial implications involved with doing so that only your business accountant would have the ability to properly prepare you for, while protecting you from any extra liabilities. Once you expand beyond the small business or self-employed realm, it is time to expand your team as well, and hiring a business accountant when it is necessary to do so can only help you better your business and make things run more smoothly for you. As a business owner it is not absolutely necessary to hire a bookkeeper or business accountant for your financial needs, but it is a good idea if you wear other hats when it comes to life or to your business. Not only can hiring a professional keep you in the clear financially, but it allows you to take the time to deal with the more important things in life.