United States Charity

Anthony Mora asked:


So AIG is looking to pay $165 million in bonuses and compensation.  There is a good PR move!  Have the government bail you out and then pay millions in bonuses.  Talk about a ready made public relations nightmare.  Perhaps the company figures that it is mitigating some of the well deserved national outcry by identifying banks that received chunks of the company’s billions in federal bailout funds last year.  But what does that accomplish?  That’s not so much transparency as it is sharing the blame.  AIG was recipient of at least $170 billion in federal bailout money (that’s billion with a B) and received an $85 billion loan from the Federal Reserve. 

 If there had been no bailout and no loan, there would be no company and thus no bonuses.  The bailout and bonuses should have come with that caveat – no bonuses.  Bonuses are incentives that are paid out for jobs well done.  Or at least they should be.  No small business would exist or function under this type of framework.  That’s why I’m more convinced than ever that small businesses are what can, and hopefully will, turn the economy around and set the country back on course.  Because there is not a huge bureaucracy in which to hide, small businesses, by their very nature, are forced to be much more transparent.  Because there is little or no fat to absorb poor decisions, small businesses must function properly and turn a profit in order to survive, much less thrive.  We have seen that big is not always better.  In fact if recent history is to be our guide, it seems to be a ready made recipe for failure.  This is not always the case, but seemingly more often than not.  So, if the small business community takes the lead and makes its voice heard, perhaps we’ll look back at this economic mess we find ourselves in and see that it served a purpose.

Copyright © Anthony Mora 2009

Nate Stockard asked:


Small business marketing is small, as noted by the name, but too many times business owners think that small business marketing is too small for planning, budgets, or strategies. Since small businesses usually have little or no marketing budget and are concentrating on just keeping the doors open, owners, more times than not, neglect their marketing planning. No business should exist without marketing planning and strategies!

Actually, small business marketing requires planning and strategy more than major companies.

When the marketing manager of a large corporation has a $20 million marketing budget just for print ads, they have room to make mistakes, produce the wrong ads, and even scrap the marketing plan half-way through completion. Small businesses don’t have such freedom and liberty. Small business marketing should contain a plan before anything else happens in the company in the area of sales and marketing. There should be budgets and strategies created as early as possible and reviewed as often as possible.

Create a marketing plan as soon as you decide to start a business.

My company specializes in helping small businesses with marketing and design, and we encounter many of the same problems, and they all stem from lack of early planning. Once you decide to start a business, start creating a marketing plan.



Who are your customers?

What are their needs and wants?

How will you acquire new customers?

What kind of customer relationship management systems will you use?

What do your customers expect from you?

What are your products’ benefits?

What are your strengths?

What are your weaknesses?

How will you advertise?

How much will you budget for marketing?



This list is actually very small when it comes to creating a marketing plan, but you must answer all of these questions and more. Small business marketing must be precise, have a defined strategy, and contain at least a rough budget. Figure out who your customer is, how you will reach them, and why they will buy from you. Starting with these three areas will give you a plethora of other questions to answer in figuring out the maze of small business marketing.

 

 

Mark Walters asked:


Have you ever wished there were red flags to alert you when your business was heading into a slump? Maybe you can find a miracle tool that would alert you before wading into uncharted waters where that cause so many small businesses to sink? The good news is, there are tools that will do just this.

Money Curve

Following the money curve is more difficult than it appears. The first step is to learn how to budget. One of the most common business mistakes is spending money as it comes in and leaving nothing for major projects such as an advertising campaign, upgrading equipment, or starting a passive stream of income.

Cash management starts with the ability to budget money and prepare a cash flow projection. If this tool will tell a bank whether the business is a good credit risk, then it will tell the business owner how healthy the company is.

The second half of the strategy is the Cash Flow Statement. The projection lets the owner calculate what they need in the future. The statement tracks the money that goes out. The statement can be created based on the actual cash, including personal money, or it can be based solely on the business’s books.

Watch for Falling Sales

Never wait until the cash flow starts a downward trend. A healthy business should have a gradually upward curve. A level or wavy curve is a sign of trouble. An advertising campaign should be started at least six months before the cash flow starts a downward turn.

Another thing to measure is profit margin. Sales and profit margins are different and can be totally unrelated. Sales and Revenues are the money that comes into the business. Profits are the money left over after the expenses are withdrawn.

Two companies may earn $10 000. One earns $1000 profit, and the other earns $5000 profits. Calculate the profit margin. Create a ‘cut off’ rate. Anything below that level should be considered a ‘warning.’

Borrowing

Borrowing money to pay debts is a sure sign of trouble. This doesn’t mean that it is wrong to borrow. The amount borrowed should never climb above 20% of revenue. Any amounts above this should be considered a ‘warning’ and be corrected as soon as possible.

Another aspect of borrowing is to calculate the amount of money spent on interest in a year. The lower interest rates are important, but so is the term of the loan. Businesses should keep the term as short as possible.

Past Due Notices

This is the ultimate red flag or warning sign. It signals to the business owner that they have lost a grip on the business’s cash flow. No matter how much, or how little, a business has coming in, it is vital to ensure that the business is self sustaining.

Stealing from The Company

The company should be seen as a separate entity. Its cash belongs to it. A business needs to be nurtured. In the brick and mortar world, a business should be self-supportive for the first five years.

Traditionally, business owners never expected the business to support the family through this time. Internet businesses have a shorter span, but they still need to be nurtured.

Every time money is removed from the company the business owner should tack a ‘red flag’ to their cash flow charts. All revenue should be returned to the business until it is self sustaining with enough ‘cash in reserves’ to avoid at least on emergency, and support expansion.

How to Avoid Problems

Get Help: There are thousands of qualified professionals who freelance for a fraction of what a company would charge.

Be Truthful: Avoiding issues, brushing over problems, and lying to people who can help should all be considered warning signs. When you run into financial trouble, then head to the bank. They have a lot in stake and will help, even if the business owner hasn’t borrowed any money.

Save Money: Save money, even if it only means sticking $1 into a jar every week.

Cut Costs: There are some vital questions to ask before spending any money. Do I need it? Can I get it cheaper? Am I buying this because I ‘want’ it? How long can I do without? What problems will I encounter if I don’t buy this?’

Emergency Plan: This is a plan of action that you’ll use to help avoid problems.

There are several ways to use these tools. One business owner can keep a chart. Another one may put red pins on a cork board. Another will create a strategy plan to solve the problem. Whatever is used, it should be considered a vital part of business success.

Paul McIndoe asked:


Small businesses thinking of making the move to accept payments from customers via the internet need to seek advice before doing so, according to Tony Neate, managing director of Get Safe Online.

Research taken by the organisation reveals that 44 per cent of small businesses in the UK have been a victim of cybercrime, including internet scams, identity fraud, phishing and data theft. Of those businesses affected, more than a third (36 per cent) had suffered a computer virus and almost one in five (18 per cent) had been a victim of internet scams such as phishing, spyware or hacking in the last two years.

In such an environment, Mr Neate said that as soon as your company is responsible for handling other people’s confidential information, then new rules and regulations come in to play.

He reveals that there are now regulations that have been brought in by the credit card companies, and small business outfits probably need to have a look at those because they will likely be imposed on them as a result of taking credit card details.

The message is that if you are not an expert in relation to computers and computer security and you have your own e-commerce site or server, then you need to get advice. Furthermore, if you are taking people’s credit card details and transacting online, make sure you have listened to the correct advice.

However, Get Safe Online reveals only five per cent of small businesses have access to dedicated IT support, either internally or via an outsourced provider. Instead, many business owners have to take it upon themselves to keep up with the latest online security issues. Of those who had experienced online crime or other IT-related problems, almost a fifth (19 per cent) said they lost revenue as a result of downtime – the average figure cited as £1,540 – or an estimated £750 million in losses across the UK small business population as a whole.

Furthermore 60 per cent of small businesses said they would grind to a halt altogether if their PCs were taken down by cybercrime or IT related issues.

While businesses must look at access control, data encryption and secure password practices, as well as looking at other measures such as staff training, it’s also important to remember that by taking a few simple precautions should mean that online risks needn’t overshadow the huge benefits that the internet brings to UK businesses.

Disclaimer:

This article has been written for information and interest purposes only. The information contained within this article is the opinion of the author only, and should not be construed as advice or used to make financial decisions. Expert financial advice should always be sought and any links contained within this article are included for information purposes only.

Business Local Listings asked:


If your business still does not have a merchant account that allows you to offer full credit card services, you are turning your back on profits. Just take a look at all of your competitors. All of those that pose serious competition accept credit card payments. Those that do not have credit card services do not have great sales figures to show, either. Even statistics point to the fact that companies that have credit card services earn much more than companies that do not have credit card services. The average credit card sale is $40 while the average cash sale is only $9. That means you are losing potentially $31 per sale.

You may also be spending more by accepting only cash and check payments in your business. The processing of cash and checks has been found to be more costly, requiring more manpower in handling. Studies have shown that the average processing cost of credit card payments is only 2.7% of a transaction while the average processing cost of checks is 4% of a transaction and the average processing cost of cash is 4.8% of a transaction. Once again, you are leaking profits by refusing to accept credit card payments.

So how do you accept credit card payments in your business? This is where credit card services come in. The old route is to apply for a merchant account in a bank. You will then have to lease the software and equipment necessary to actually process payments and send the data to your account. If you want to accept credit card payments online, you need to apply to a payment gateway that allows real time credit card authorization for online transactions. You should ensure that your payment gateway is compatible with the bank or financial institution where you have your merchant account, and with the software and equipment you have leased.

In choosing the bank or financial institution for your merchant account, consider their expertise in combating fraud and reducing chargebacks. Also make sure that they are experienced in handling merchant accounts with online transactions.

If you are a small business owner, stick to a bank or financial institution that caters to small businesses rather than large companies. You may be able to get better rates and packages designed for your specific niche.

There are options for credit card services that offer everything you need in one easy package. You will not have to deal with various entities or go through various procedures. Often, these options also have added benefits, among them, quick reporting on your credit card sales figures. They may also offer interest on your credit card sales income, even up to money market rates.

One very important feature of your credit card services that you may not know of is that it can automatically qualify you to avail of small business loans. Once you have established a record of sales through credit, most credit card services will allow you to make cash advances that are practically like getting previously approved small business loans without having to put up any required collateral. The credit card services consider your future income through credit card sales as your collateral. This can go a long way in further growing your business.

Payment will not be a problem, either. For as long as you have sales through credit payments, you automatically get to pay your small business loans. It does not matter how much your sales are. Your payments are automatically deducted as a percentage of your sales. You are always covered.

Now do you still need further convincing on the benefits of credit card services for your business?

Jenny Black asked:


Small business health insurance is one of the benefits that you intend to provide to your small group of employees. Apart from wages many companies provide benefits like paid vacation, maternity benefits, etc to retain the employees in their organization. Small business health insurance is an added assistance to all these benefits.

A small business organization generally comprises of 2 to 50 employees. Each employee is very vital to the organization. If, even a single employee falls ill, the whole organization will become dysfunctional. Therefore ensuring a good health of the employees is one of the most essential responsibilities of the employer who owns a small business organization.

With the advancement of science and technology, the costs of medical benefits are also on a rise. This is a major reason which prevents people from going to a doctor for any health problems. It should be kept in mind that if an illness is not taken care of at the initial stage it may lead to many complications at a later stage. By providing an appropriate health insurance policy for all the employees through group health insurance, an employer can free his employees from all the health related problems.

Most small business owners provide small business health insurance through group plans which use organized medical networks. There are several types of networks: HMOs, PPOs etc. You should know about all of them because each will be having different characteristics that will affect your choices or the types of insurance you want for your small business organization.

In HMO or Health Maintenance Organization, the medical needs of the people who subscribe are provided by a managed system of medical care. On the other hand, physicians, health care providers of all types, hospitals and clinics sign contracts with the PPO (Preferred Provider Organization) system to provide care to its insured people. HMOs often have lower premiums but they must be available in close proximity to your employees and the workplace. PPOs and POSs tend to cost slightly more but are flexible for your employees.

These all things should be made clear before purchasing any small business health insurance. Apart from that through small business health insurance you can also get insurance quotes for yourself and your family members. This can be availed by paying a very cheaper rate of insurance. Tax incentives are also available with the purchase of small business health insurance. In this way you can save a few pounds for yourself.

You should carefully do a study of the quotes as provided by different providers. The pros and cons of almost all the details available need to be addressed. An exhaustive comparison of the different insurance companies and their rates of premiums should also be done by you. This is much easier now with the internet that provides almost all the information that you will need in the process of purchasing a small business health insurance.

Cary B asked:


While looking for free web hosting for your small business you need to keep the following things in mind.

Advertising: Just about all free web hosts will impose advertising on your site. The host does this to recover the costs of running the hardware and providing the bandwidth for your site.

Web Space: Most free small business web hosting has very limited space. You will be lucky if you find a free host that offers more than 20MB of disk space. This isn’t such a bad thing as most sites are under 5MB in size. A 5MB site can be up to 200 pages of html code but beware, if you site contains heavy graphics, music or video this limited free space will run out very quickly.

FTP: Some small business web hosts do not provide FTP access. FTP stands for File Transmission Protocol and allows you to transfer large files via a server. This isn’t a big deal if you don’t do a lot of file transfers but if you plan on sending and receiving lots of images or video files this is something you need to be aware of.

Stability and Reliability: This is an important factor to look at. Unless you don’t mind you site going down or off-line all the time you need to find out what the free small business web host provider “down time” is. If it is anything more than 99% I do not recommend using this provider.

Bandwidth: To have enough bandwidth to run a small business website you need about 1-3GB of monthly bandwidth. Anything less than 1GB and the most you will be running on it will be a personal webpage or one for the local church.

 

Corte Swearingen asked:


Did you know that most small business websites generate very little traffic? Whether you have outsourced your web design or have it done in-house, it is important that your webmaster understands the basic structure and on-page criteria that will make the search engines happy. And when the search engines are happy, the result is increased targeted traffic.

Website Mistake #1: Not Building Trust

Probably the biggest mistake I see is the lack of trust-building content. If your website is filled with sales pressure tactics or doesn’t offer any helpful and informative content, people will simply move on to something else. Remember, when people come to your site, they are in complete control. Give them just one reason to leave and they will.

You must earn your visitor’s confidence through original, useful and compelling content. Remember, in many cases, people are coming to your site from the search engines to find information, not to make a purchase. Give them what they want.

If you’re not sure what kind of content to write about on your site, then it’s time to invest in a paid keyword research tool like Wordtracker or KeyWord Discovery. These tools will help you uncover search phrases that you can then use to write page content.

Website Mistake #2: Improper On-Page Criteria

The search engines look for certain elements contained within your page. There are proactive ways you can help ensure your pages get ranked favorably. These include making sure all your META Tags are correct, your primary keyword phrase is sprinkled throughout your text, and that you include a link with your main keyword in the anchor text.

Website Mistake #3: Not Building Inbound Links

Did you know the search engines look at how many external websites have links that point to your site? If there are a lot of high-quality websites that point back to your site, the search engines see that as a vote of confidence and they will give your site more weight in the search engine rankings.

If you are constantly adding quality content to your site, it’s just a matter of time before other sites start linking to yours. However, don’t wait for other people to discover you – be proactive. Here are some simple ways to build links.

* Submit your site to quality directories

* Submit articles that contain a link back to your site in the Author Bio

* Provide you link partners with appropriate keyword-rich anchor text

* Answer questions in forums and blogs, providing a link in your signature file

* Work to get links that point to deeper pages within your site (not just your Homepage)

Website Mistake #4: Poor Website Structure/Navigation

Search engines will come to your website and try to collect as much information as they can for their index. Some small business owners have such haphazard website structure that it’s a wonder the search engines come visiting at all. It would be sad to see all that good content go to waste because the search engines couldn’t find your pages.

One highly recommended design is a three tier structure. Your Tier 1 page is your home page. Your Tier 2 pages are your navigation link landing pages. Your Tier 3 pages are the additional content pages that support the theme of the respective Tier 2 pages.

Most of your site will be comprised of these Tier 3 pages. Tier 3 pages should always link back to their respective Tier 2 parent. Likewise, all Tier 2 pages should link back to the Homepage. The search engines can easily picked up on this link structure and index your pages.

Website Mistake #5: Lack of Monetization Models

Having a compelling website that drives over 1,000 unique visitors a day is something to be proud of. But what is it worth if you are not able to capitalize on that traffic? You need to ensure you have several monetization models in place on your website so that you have multiple sources of revenue.

In addition, if you have several income streams developed, you’ll be in a better position if one of them dries up for some reason. Your parents were right when they said not to put all your eggs in one basket. Several popular monetization options include selling downloadable ebooks, selling physical products, and revenue generated from affiliate sales or commissioned products.

There’s a lot of small business websites that generate little traffic. Follow these simple strategies to make sure your site isn’t one of them.

Paul Flood asked:


Copyright (c) 2008 Paul Flood Marketing, LLC

Entrepreneurs know the importance of a targeted small business marketing strategy. Many make the mistake of doing what big advertisers do. Rock icon Meat Loaf is in a great commercial but the product and company selling it are easily forgotten. Learn a lesson on how not to advertise

Remember Meat Loaf (born Michael Lee Aday)? His album Bat Out of Hell, released in 1977, has sold nearly 40,000,000 copies and was on the charts for over 9 years. He is also featured in a new commercial that is running pretty frequently on TV.

The ad features Meat Loaf as a dad whose son is begging him to get him a cell phone. He’s singing about how he won’t run up the minutes. Personally, I am a fan of Meat Loaf and I like the commercial. He includes some lyrics and riffs from Paradise by the Dashboard Light, which I’ve always thought was a cool tune.

The other afternoon, I heard the commercial and started singing the tune in my head and realized I had seen the commercial several times and could not think of the company or brand of the phone! Now, I’m thinking this was a fairly expensive production because in addition to Meat Loaf, Tiffany is in the commercial and they are probably fairly expensive talent to hire.

After all of this expense, I couldn’t relate a brand or a product to the commercial! I kept an eye out for the next airing and saw it was for the AT&T GoPhone. Think of all the money spent on the ad. They did a lot of things right like using celebrity endorsements, a good tune and an entertaining spot. But it really made me wonder, why couldn’t I think of the company or the product?

What could you do differently if were considering a similar TV ad as one of your primary small business marketing tools ? For one thing, a bit more focus on the product instead of the production. You could easily think of special offers that would give prospects a reason to buy soon. I’ll bet a contest to have dinner with Meat Loaf or win a free “Bat Out of Hell” concert DVD would attract buyers. You would have a tracking mechanism to see how many inquiries and sales were generated. What if they had a toll free number, 1-800-MeatLoaf, to call and get a special offer and find out how to download the song to iTunes or even a ring-tone? The marketing folks could track response and the ROI on the ad. What if there were a contest to be in a commercial with Meat Loaf?

But instead, the focus was all on creativity and entertainment. I’ll bet the ad will even win an award but I still think ads should be written to sell the product now, not build a brand or win awards. My guess is that you can’t afford Meat Loaf in your ads but remember, when you do advertise, it’s about making money, not building your brand. Brands don’t put food on the table, sales do. When you spend money on marketing, either do it yourself of find a professional whose goal is to increase your profits and is willing to guarantee results, not just earn a commission.

The commercial may not be on TV too long but you can catch it on www.youtube.com. Search for Meat Loaf AT&T. This version is a 90 second commercial that does a better job of naming the product than the spot on TV but it still could have soooo much more potential as a source of REVENUE instead of a brand. When you think about branding as a strategy, ask yourself if you want to get your name out there or sell as much of you product or service as possible and build a strong and loyal customer list as quickly as possible.

For the small business marketing tools to add to your toolbox, go ahead and think about branding. However, your brand needs to be strong and you should strengthen it with incredible products and service or with your Unique Selling Proposition. Build your brand using marketing that creates prospects and leads. It is just as expensive to get your name out there with a compelling offer and reason for a client to buy from you now as it is to just get your name out there. The difference is the ROI. The Meat Loaf commercial offers no way to measure the ROI and small businesses can’t afford to throw scarce marketing dollars up against the wall and guess at the ROI.

Here is a powerful small business marketing tip when it comes to a brand-building strategy: If your financial planner came to you with an idea to spend $10,000 on marketing as an investment, you’d think, “What will my return be?because she is a trusted advisor. Use the same standards with your marketing, advertising and media reps. Ask the question: “What is my projected return and how does it compare to other marketing investments?When the rep tells you the value of impressions, ask for some statistics from other advertisers regarding the ROI of the ads and spots they are running?

After you watch the YouTube video, see if you can help me out. Why is Tiffany holding a leg of lamb when she enters the commercial set? Maybe there is some reference I don’t remember from Meat Loaf’s earlier days. He was quite a theatrical talent!

Akhil Shahani asked:


Talking about business laws in microscopic detail would need a couple of months of your time! There is indeed a plethora of legislation that governs small businesses, ranging from state to county laws. Some are relevant to your business even today whereas others are outdated and have not been enforced since the early part of the last century!

It is not possible for any single entity, including your local law enforcement department to know them all. Yet, it is vital that you are familiar with at least the most important laws that pertain to your business. As usual we’re here to help.

Business laws fall into certain categories as listed below:

• Business formation laws – these laws pertain to the structure of the business. For example a sole proprietorship is regulated very differently from a corporation.

• Tax laws – comprise laws pertaining to all taxation issues, whether it is the filing of returns or the payment of sales tax, corporate tax and other similar levies.

• Employment laws – these govern recruitment and retrenchment of employees, wages & workers’ compensation, unemployment benefits, workers’ rights and related issues.

• Trademark and patent laws – these laws pertaining to ownership of intellectual property such as inventions, trademarks and patents.

• Environmental laws – Companies engaged in the recycling of material and the discharge of hazardous waste must comply with environmental regulations.

• Consumer protection laws – these protect the consumer from fraud or unfair business or advertising practices.

Headache, already? Here are a few tips to help you deal with it.

One size doesn’t fit all. We just talked about some of the important legal categories under which you will find regulations that affect most businesses. In addition, specific laws may apply depending on the type of activity involved. If, for example, you are selling company stocks you will need to adhere to the Securities Law, but for a medical practice, there’s an entirely different set of rules that come into play. State laws may also dictate how contracts and legal documents are to be written and enforced.

Start at the beginning. Just as you craft a business plan in stages, look at the whole legal puzzle bit by bit. Begin with the laws pertaining to the basics of starting a business. Do you need a business license or a special permit? Are you planning to hire employees or will you go it alone? If your business sells goods, it will need to pay sales tax. Look at each business aspect carefully to understand which category of laws apply to it.

Know only what you need to. If you are in business by yourself, for example, you won’t need to bother with laws governing workers and staff until you are ready to hire additional people. Likewise, if you are in a service business, you typically won’t need to bother yourself with removal of hazardous waste.

See the bigger picture. As your business grows, so will the number of applicable laws. Always examine the legal angle when you plan new projects and initiatives. Also, discuss all potential significant legal matters with your advisor.

Ensure compliance. Be unafraid to ask questions of your legal advisor and do not assume something is legal just because it is a common trade practice. Also talk to the local Chamber of Commerce or other business owners to make sure you are on the right side of the law.

Make amends. Finally, should you find that you’ve contravened a law without intending to, take remedial measures. The law is quite lenient with first time offenders – of course, it also depends on the nature of the violation.

Having to deal with laws and legislation may seem a drag, but there’s no denying their importance. Taking adequate steps to ensure that you have to run into them only as much as you need to!

LegalMessenger.com™ is one of the leading online providers of business and personal legal forms and contracts. When you request a legal form or contract, LegalMessenger.com™ gives you all related legal documents on the same subject for FREE, providing you with a Complete and Total Protection of your rights.

The My Tax Tutor series is full of tax saving tips, tricks and strategies specially designed to cater to Home-Based Business Owners, Internet Marketers, Small Business Owners and Truckers.