| Starting Business Secrets will help you to | | | | need your Social Security Number or your |
| start your own business successfully. | | | | Federal Employer's Identification Number, |
| | | | your driver's license, the fictitious name |
| | | | certificate, and if you're requesting a VISA |
| | | | or Master Charge franchise, you'll also need |
| The American Dream is, and always will be, to | | | | a financial statement. |
| come up with an idea, start a business and | | | | |
| become rich from your own efforts. Based upon | | | | |
| this motivation, thousands of businesses fail | | | | |
| each year, due primarily to not being | | | | For corporations, you'll also need a |
| familiar with the basics involved in running | | | | corporate resolution approving of the opening |
| a business. | | | | of your business account. |
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| This report will enlighten you, and give you | | | | There are different policies exercised in |
| a number of suggestions you can use to better | | | | just about every state regarding installation |
| guarantee your chances for success. This | | | | hook-up charges by the telephone and utility |
| report is written with the warning that any | | | | companies. Some require a deposit, and some |
| and every business venture contains certain | | | | don't. |
| inherent risks, and any number of | | | | |
| alternatives. We do not espouse that any one | | | | |
| way is the right way or that our suggestions | | | | |
| are the only way. On the contrary, we advise | | | | You'll find that a great number of city |
| that before investing any money in a business | | | | business license departments are there solely |
| venture, you seek counselling and help from a | | | | for the purpose of collecting another tax. |
| qualified accountant and/or attorney. | | | | Depending on the type of business you're |
| | | | asking a license for, the building and zoning |
| | | | people may inspect your premises for |
| | | | soundness of structure and safety. Generally, |
| Just about the first thing you should | | | | you won't encounter any difficulties - you |
| consider before deciding to start or purchase | | | | simply pay your fee to operate your business |
| a business is the legal form you'll be | | | | in that city, and the clerk types your name |
| operating under. There are basically four | | | | onto a city license certificate. |
| choices: sole proprietorship, partnership, | | | | |
| limited partnership, and/or corporation. | | | | |
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| | | | Relative to sales tax permits and licenses, |
| | | | each state's rules and regulations very |
| Each has a number of advantages and | | | | widely. The best thing to do is call your |
| disadvantages. We'll try to enumerate some of | | | | state offices and ask for information |
| them for you. | | | | concerning registry and collection |
| | | | procedures. Many states require an advance |
| | | | deposit or bond, and you'll find that some |
| | | | wholesalers or manufacturers will not sell to |
| As much as anything else, for many people | | | | you at wholesale prices until you can show |
| starting a business is a form of | | | | them your sales tax permit or number. |
| ego-gratification, and they form a | | | | |
| corporation for some sort of prestige gain - | | | | |
| just to say, "I own a corporation." | | | | |
| | | | Should your business entail selling your |
| | | | products or services across state lines, in |
| | | | another state, you're not required to collect |
| With just a little bit of observation, you'll | | | | taxes except in those where you have offices |
| find that one of the major causes of business | | | | or stores. |
| failures is due to the founder wasting | | | | |
| start-up capital on frills, such as an | | | | |
| impressive store- front office, expensive | | | | |
| furnishings, and corporate legal costs. | | | | You may find also that your particular |
| | | | business requires the collection of Federal |
| | | | Excise Taxes. For information along these |
| | | | lines, check in with your local office of the |
| One of the basic traits you must develop it | | | | Internal Revenue Service. |
| you're going to be successful in business, is | | | | |
| a tight hold on your expenditures. In fact, a | | | | |
| good rule of thumb is that anything that does | | | | |
| not make money for yo or protect your | | | | Some states also require certain businesses |
| investment, should not be purchased at this | | | | to hold state licenses, such as those |
| time. Very definitely, this applies to the | | | | required in many states for TV Repairmen. |
| expense of setting up your own corporation. | | | | |
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| | | | These are known as "occupational permits" and |
| Unless you have a partnership and start your | | | | are most often required of barbers, hair |
| business as such, the only real advantage to | | | | stylists, real estate people and a number of |
| forming a corporation would appear to be that | | | | other consumer oriented businesses. If you |
| a corporate structure will semi-protect the | | | | have any doubts, check with your state |
| property you personally own. | | | | offices for a list of those occupations that |
| | | | require licensing. |
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| As an example, you own a home and car. You | | | | |
| form a corporation to protect these | | | | Any business doing business in any type of |
| possessions from business losses. Yet, if you | | | | interstate commerce is subject to federal |
| can be found guilty of misusing corporate | | | | regulations, usually through the Federal |
| funds, your business creditors can pierce the | | | | Trade Commission. This means that any |
| corporate shield and come after your | | | | business that shops, sells or advertises in |
| possessions. | | | | more than one state is subject to such |
| | | | regulation, and this includes even the |
| | | | smallest of mail order operations. |
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| Basically, if you invest everything you have | | | | |
| in your business, as most newcomers do, you | | | | |
| don't usually need a corporation because you | | | | Normally, very few business people ever have |
| have nothing to protect. Your household | | | | and contact with the federal regulatory |
| possessions, personal belongings, generally | | | | agencies. The only exceptions being when |
| your car, and even a portion of the equity in | | | | there is a question of your operating your |
| your home is protected by the homestead | | | | business unethically or illegally. |
| provision of the Federal Bankruptcy Act, and | | | | |
| cannot be taken away from you. | | | | |
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| | | | Any business that sells or distributes food |
| | | | in any manner almost always requires a county |
| As a sole proprietor or partner of a business | | | | health department permit. If your business |
| you'll be paying taxes on your overall | | | | falls into this category, simply call the |
| earnings, much the same as if you were | | | | county health department and invite them out |
| holding down a salaried or hourly paid job. | | | | to your place of business for an inspection. |
| Whether you do or don't take out money as a | | | | The fees generally range from about $25, |
| salary will have no bearing on the earnings | | | | depending on the size of your business when |
| of your business and tax return. | | | | they first inspect it for permit approval. |
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| The often advertised advantage of | | | | There are also a number of businesses that |
| incorporating, that you can manipulate your | | | | require inspection by a fire marshall, and |
| salary in order to save on tax dollars, is | | | | fire department approval. Generally, these |
| real because of corporation laws. However, | | | | are those that handle flammable materials or |
| the IRS frowns on this practice. When your | | | | attract large numbers of people, such as a |
| business is successful and making a lot of | | | | theater. Overall, the local fire department |
| money, definitely check with your accountant | | | | has to be allowed to inspect your premises |
| on the advantages of incorporating. | | | | whenever they desire to do so. |
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| As a corporation, you'll be subject to a | | | | You may also run into a requirement for an |
| number of other drawbacks as well: generally | | | | air and/or water pollution control permit. |
| higher state taxes, stricter laws concerning | | | | These specifically apply to any business that |
| the operation of your business, more | | | | burns anything, discharges anything into the |
| elaborate accounting procedures, and legal | | | | sewers or waterways, or use any gas-producing |
| papers that are required just about every | | | | product, such as a paint sprayer. |
| time you make a major move or sign almost any | | | | |
| contract. Thus, your legal and accounting | | | | |
| fees will be much higher as a corporation | | | | |
| than will those required for a sole | | | | Without a doubt, you'll need to check on |
| proprietorship type of business. | | | | local regulations relating to advertising |
| | | | display signs. Each city or township makes |
| | | | its own rules and then enforces those rules |
| | | | according to its own thinking -check before |
| As a sole proprietor or partnership, you'll | | | | you contract to have a sign made for your |
| find many areas require the registration of | | | | business. |
| your business name. The cost however, is | | | | |
| minimal, ranging from $5 to $100. About the | | | | |
| best way to find out what laws apply in your | | | | |
| area, is to call your bank and ask if they | | | | The design and placement of your sign is very |
| need a fictitious name registration card or | | | | important to your business - specifically to |
| certificate in order for you to open a | | | | retail establishments - but let me remind you |
| business account. | | | | that your business sign is usually the first |
| | | | thing a potential customer sees and as such, |
| | | | it should catch his eye and leave an |
| | | | impression that lasts. It would be a good |
| Selecting a name for your business is quite | | | | idea to ride around your town and take a look |
| important to you and particularly relative to | | | | at the signs that catch your eye, and try to |
| advertising. Your business name should | | | | determine the impression of the business that |
| describe the product or services you offer. | | | | sign leaves on you. This is a basic learning |
| Fancy names such as, Linda's Clipping Service | | | | formula for determining the design, size and |
| will lose potential "walk-in and passing" | | | | placement of your business sign. |
| customers to the beauty shop across the | | | | |
| street that calls itself, Patti's Beauty | | | | |
| Salon or Jane's Hair Styling Shop. | | | | |
| | | | Some of the other things to consider before |
| | | | opening for business - If you intend to |
| | | | employ one or more employees, you'll be |
| The advantage of using your full name in the | | | | required to deduct Federal Income Taxes, and |
| title of your business, such as Johnny Jones' | | | | Social Security payments from their checks. |
| Meat Lockers, has the advantage of making | | | | This will involve your filing for a Federal |
| credit somewhat easier to come by - provided | | | | Tax Number and necessitates contact with your |
| you pay your bills on time - but it also | | | | local IRS Office. |
| includes the disadvantage of confining your | | | | |
| services to a local or at most, a regional | | | | |
| area. | | | | |
| | | | Most states have "unemployment taxes" which |
| | | | will have to be deducted from the paychecks |
| | | | of any employees you hire. And there are a |
| Should you buy, lease, or rent a space for | | | | number of states that have income taxes - |
| your business? think twice before you make | | | | disability insurance - and any number of |
| any decision along these lines. Most | | | | other taxes. Again, the best thing to do is |
| businesses tend to grow quickly or they never | | | | check with your local office of the IRS. And |
| get off the ground. | | | | above all else, don't forget to ask for the |
| | | | rules of the minimum wage law, and comply. |
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| There are a few exceptions, but only a very | | | | |
| few, that tend to grow at a modified rate. | | | | When your business grows to the point of |
| | | | needing additional help, don't be afraid to |
| | | | look for and hire the help you need. when |
| | | | you're ready to hire someone, simply run an |
| So, buying a piece of property and setting up | | | | ad in your local paper and/or register your |
| your business on or within that property, | | | | needs with the local office of your state's |
| obligates you to ownership regardless of what | | | | employment service. Businesses either grow or |
| happens to your business. | | | | die, and those that grow eventually need more |
| | | | people in order to continue growing. |
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| Leases are almost always very strong | | | | |
| contracts written by attorneys to the | | | | When that time comes, hire the additional |
| advantage of the property-owner. When you | | | | people you need, and your business will |
| sign an agreement to pay someone for the use | | | | continue growing. If you don't, for whatever |
| of their space over any length of time, | | | | reason, you'll find yourself married to your |
| you're "nailed in" to paying for that space | | | | business and your business growth stymied. |
| regardless of what happens to your business. | | | | |
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| | | | Regardless of how small your business is when |
| In the beginning, it's wise to either get the | | | | you begin, never walk in with the thought in |
| shortest-term lease possible, or arrange to | | | | mind that it's something to keep you busy. |
| rent with an option to lease at a later date. | | | | Anyone with an attitude of that kind is a |
| This does not apply to a retail business, | | | | fool. You begin and make a business |
| unless your particular business happens to be | | | | successful in order to realize financial |
| an untried one. | | | | freedom. Establish your business. Put it on |
| | | | its feet, and then hire other people to do |
| | | | the work for you. And those businesses that |
| | | | require an operations manager, or someone to |
| Definitely, you should open a business bank | | | | run a phase of the business you're too busy |
| account. In selecting a bank for your | | | | to handle, hire the person needed or the |
| business, scout around and look for one that | | | | business will surely suffer. |
| can, and will help you. Determine what your | | | | |
| banking needs will be, and then via | | | | |
| telephone, interview the managers of the | | | | |
| banks in your area. The important convenient | | | | To protect the investment of your business, |
| bank to your business location. | | | | you need business insurance. If you've never |
| | | | had any experience with business insurance, |
| | | | simply look under the heading of "business |
| | | | insurance" in your phone directory. Ask for |
| A point to remember: the closer you can make | | | | bids from several different companies or |
| the relationship between you and the bank | | | | agents...Primarily, you should have a policy |
| manager, the better your chances are going to | | | | that gives you general liability, fire, |
| be for approval on loans and/or special | | | | workmen's compensation, business |
| favors you may need at a later date. | | | | interruption, and vehicle coverage. You amy |
| | | | also want coverage against possible losses |
| | | | related to burglary, robbery, Life & |
| | | | Accident, Key Man, and Fidelity Bonds. |
| Try to become acquainted with as many of the | | | | |
| bank employees as possible. The better you | | | | |
| know them, the more courtesies they'll be | | | | |
| extending especially to you in the course of | | | | As the sole proprietor of a business, you |
| your association. | | | | won't be paid as an employee, so there will |
| | | | be no income tax deducted from whatever you |
| | | | withdraw from the company's earnings. What |
| | | | you'll have to do is a gain check with the |
| Just as a doctor is a specialist in his | | | | IRS Office for a Tax Guide For Small |
| field, and you go to him for medical | | | | Businesses Handbook, and probably end up |
| problems, your banker is a specialist in his | | | | filing an estimated tax return on a quarterly |
| field and you should go to him for your money | | | | basis. |
| problems. In business, you'll have to learn | | | | |
| that everyone is an expert in his own line of | | | | |
| work, and in your associations with other | | | | |
| business people, refrain from acting like a | | | | The minute you open your doors for business, |
| "sharpie" and/or pretending that you know | | | | you'll have to spend some time engaged in the |
| exactly how everything works in someone | | | | work of bookkeeping. Exactly how, and using |
| else's specialty. | | | | what forms, you keep books, should be on the |
| | | | recommendations of a good tax counselor...The |
| | | | same holds true for your overall business and |
| | | | or payroll accounting system. Look for an |
| You'll find that very often, different banks | | | | experienced CPA that knows the accounting |
| specialize in different types of businesses. | | | | problems to your particular kind of business, |
| As an example, you're sure to find banks that | | | | and solicit his advise/counseling. |
| specialize in real estate transactions, | | | | |
| export- import businesses, and even | | | | |
| manufacturing operations only. | | | | |
| | | | If your business is going to involve the |
| | | | possible purchase or lease of operating |
| | | | equipment, again seek the help of your tax |
| What I'm saying here is that if you're | | | | counselor for the most advantageous method of |
| planning to sella fairly expensive item, your | | | | obtaining the needed equipment. |
| customers will probably need and/or want | | | | |
| financing. It will behoove you to select a | | | | |
| bank familiar with your type of product that | | | | |
| will afford your customers, through you, | | | | Basically, arranging for your suppliers to |
| contract financing. | | | | give you materials on credit will depend upon |
| | | | your honesty and personal financial |
| | | | statement. The best way is usually a personal |
| | | | visit to the person with the power to approve |
| Some of the questions you should ask of your | | | | or disapprove of credit at the company where |
| banker include the following: | | | | you want to set up a credit account. Show him |
| | | | your financial statement, and explain your |
| | | | prospects for success. Then assure him that |
| | | | you've always honored all of your |
| Is it necessary to maintain a certain balance | | | | obligations, and that if ever there's a |
| in your account before the bank will approve | | | | question or problem, you'd like for him to |
| a loan for you? What qualifications must you | | | | call you at home. And of course, give him |
| have in order to obtain a line of credit with | | | | your home phone number. |
| the bank? | | | | |
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| | | | We won't go into the exigencies of |
| Does the bank limit the number of loans, or | | | | advertising your products, services or |
| types of loans it will approve for small | | | | business here, but there is something along |
| businesses? | | | | these lines you should always keep in mind. |
| | | | The best kind of advertising your business |
| | | | can receive is that you don't really pay for |
| | | | - publicity. |
| What is the bank's policy regarding the size | | | | |
| of a check you might deposit that requires | | | | |
| holding for collection? | | | | |
| | | | When something unusual happens to you, your |
| | | | business, or your employees - that's news, so |
| | | | be sure to tell the news media in your area |
| And what about checks less than that amount - | | | | about it. |
| will they be immediately credited to your | | | | |
| account? | | | | |
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| | | | The most important ingredient of your |
| | | | eventual success will be the soundness of |
| In almost all types of businesses, it will be | | | | the planning you did before you started your |
| to your benefit to set up with your bank, a | | | | business. Any number of bad things can really |
| method of handling VISA, Master Charge, and | | | | throw your business into a tailspin, but it |
| regional credit cards. The important thing | | | | you've done your homework well - really set |
| here is to ultimately set up your account in | | | | up a detailed business plan before starting - |
| the bank that will service all of these | | | | your losses or setbacks will be minimal. |
| credit transactions for you - one stop for | | | | Success takes planning, and within this |
| all your banking needs. In most instances, | | | | report, you've got a basic checklist...The |
| you'll find that having the capability to | | | | rest is up to you...Good luck, and may your |
| fill orders/make sales via credit card | | | | life overflow with success in all that you |
| transactions, will increase your volume of | | | | undertake from this moment forward. |
| sales appreciatively. | | | | --------------------------------------------- |
| | | | ------------Julia Tang publishes Smart Online |
| | | | Business Tips, a fresh and informative |
| | | | newsletter dedicated to supporting peoplelike |
| Once you've made the decision as to which | | | | you! |
| bank is going to handle your account, you'll | | | | |