Having Multiple Small at Home Businesses

There is always a question that keeps coming up to me by small business owner. Should an at home business owner have multiple businesses? I always tell them, that they have to have multiple businesses to have a successful business, especially if it’s a small at home business.

The reason behind it is because if one business goes down, you’ve started another one and you can work on that business to grow. Now let me explain more. Let’s say that you are a photographer and you want to open a photography shop. You can sell your photo taking skills, your photos, photo books, and film developing services and teach people how to take pictures. That is multiple types of businesses in photography.

If you are a cook, you can sell your catering service, you can teach someone how to cook, create a cookbook and also consultant in what type of food to serve in an event. That is multiple types of businesses.

Do you get what is going on? By taking the skills that you have and creating multiple businesses, and if one service fails, you have the other businesses that can keep you alive or your business going.

Several people who go into business always lean toward one area of the business they build and don’t want to go beyond that scope. Why do that? When you can make your business grow by going multiple ways. The more you create, the bigger the business and the more money you make.

A dress designer, can sell there clothes, create a clothes line, show people the ropes of the clothes design and put a run way show together.

Always create a list of what you can do in the business that you want and how you can multiple it. Create the list as big as you want it. Then work on the top 10 from that list and see how you can create multiple businesses from it. Then narrow it down to what will work for you and what will not. Once your list comes together, then work from there. Remember the more multiple businesses you have the more money you will make.

Owning multiple businesses is a challenge but if you are skills, organize and ready to get to work. Then owning multiple businesses is for you.

Small Businesses Are the Back Bone of the Economy

Many people want to start their own business for various reasons. It may be because they want a more relaxed life that a job can never give, or it may be because they want to provide some service that no one else provides. A business requires a lot of careful planning and hard work, but to many business owners nothing gives more satisfaction then the hard work they do for their business. If you want to start a business or be a part of that business, then you should have a fair idea about the business plan, what kind of services are you going to put forward, what are the demands for the services and what is your competition.

There are certain guidelines which should be very clear for proper and organized functioning of your business.

1.You should keep a track of all the business deals occurring daily. The day to day expenditure, income, profit and loss should be updated in the records on a daily basis. Every day’s financial transaction should be noted down for preparation of annual budget and also for payment of taxes.

2.You should revise your billing details off and on. Whether all the bills are cleared or not, should be taken care of. You should be cautious of different types of business frauds, because they can hinder the smooth running of your business to great scales.

3.The invoices should be evaluated periodically. This habit keeps you informed about the efficiency of your business. It helps you to know whether you are giving additional charges or whether you are availing the services at a comparatively lower price.

4.Taxation policies are subjected to change frequently. Hence you should be well updated about the latest tax directives.

5.For smooth running of the business, the accountant should adopt the GAAP (Generally Accepted Accounting Principles) plan. The GAAP consist of certain standard measures which should be followed by every accountant for the success of his business.

6.The budget details in any business should be simple and such that they can be easily comprehended by all the employees.

With business comes the plethora of figures and records you have struggle with. If you are not fully updated with terms like “Cash Accounting”, “Accrual basis”, “Profit and Loss statement”, “Projections”, “Data Representation”, then you are no good in this field of accounting. With business accounting comes in hand. You have to be a master in this field for your business to prosper. Just like the Central Nervous System controls and integrates all the functions of your body, similarly accounting is the key to success for business. You can always appoint an accountant to look after your business. You can hire an accountant who is interested in both your professional and personal success. He should have some previous experience and also knowledge in accounting field. Your accountant should be well updated and informed since the taxes law change day by day.

Accountant plays an important role in determining the success of your business. He helps you in building your business organization, whether you should indulge in a partnership or should be a single proprietor. He updates your accounting details for quarterly and annual reports. He assists you with the payroll, keeping in track the time and payment of various taxes. Without him you won’t be able to complete your year-end paperwork for forms like W-2 or 1099. He helps in declining your startup costs. He only knows how to keep personal and business expenses separate so as to avoid unnecessary taxes. He has full knowledge about the taxes incurred expenditure. It is because of him only that you realize the meaning of different financial statements. Thanks to him, your employees as well as you yourself get the best health insurance and other facilities. In fact accountant is the backbone of your business and hence it is a mandatory requirement for the prosperity of your business, that he and his work should be absolutely perfect without any loopholes.

Business Credit – How to Get it in This Economic Downturn

If you have been in business for a few years then you know that during a down economy cash flow can be a problem if you don’t have any business credit established. You must have access to cash to handle expenses to sustain your business during a business downturn.

In order for your business to get access to cash, you should start establishing business credit in order to have cash readily available when is it needed. There are many options that you should consider i.e. secured business credit lines, unsecured business credit line, a net-30 account, and business credit cards. Depending on the type of business you have and other factors one or all of these options may be a fit for your business. Allow me to summarize each option here.

Secured Line Of Credit

A secured credit line is a business loan that requires some type of collateral to be used in order to get this loan. Typically some real estate, or some business asset can be put up as collateral. A typical loan size for these types of loans are around $25,000-$100,000. These credit lines will usually require a personal guarantor with an A+ credit rating and the business must show a profit for at least two years. The loan underwriters are more likely to approve these types of loans since they have written a loan that is secured by assets. Two major benefits to the type of loan is that once your pay it off the have access to using it again when needed up to the original loan amount and you only pay on the amount that you borrowed.

Unsecured Line Of Credit

An unsecured line of credit is like a secured line of credit except that no collateral is needed to get approved. However, since no collateral is needed it can be more difficult to get approved for a loan amount above $10K-$15k. An unsecured line of credit usually does require a personal guarantor with excellent credit and the company must be able to show that it has been profitable for at least two years. Loan amounts higher than $25K are extremely difficult to qualify for especially in today’s market. Lenders across the board are slow to lend to anyone these days. Even though they got a $700 billion dollar bailout to lend money. Go Figure. However if your company can show strong financials for the past three years and the personal guarantor has strong personal financial statements it is quite possible to get a substantial unsecured line of credit. The rule of thumb is banks will typically lend a fifth of what the average net profit the company has brought in over a two to three year period.

Net-30 Accounts

A net 30 account is a credit account your business can establish with another company that supports your business. These account are general easy to set up since they are done with companies that you already have a relationship with. These types of accounts are very common with companies and their suppliers. These accounts are usually paid in full every 30 days. Net-30 accounts are also very useful in building your business credit. For example, when your net 30-account reports to Dun and Bradstreet, they will help establish your PayDex score. A PayDex is a standard way to rate business’s credit history much like Equifax rates personal credit. Over time and with good payment history you can establish a favorable score, the highest being 80, to start applying for business credit without a personal guarantor. This is a very effective way to build business credit for your business.

Business Credit Cards

Business credit cards are very similar to unsecured credit lines. Probably the only difference is that business credit cards offer a little easier access to cash than an unsecured credit line. Business credit cars usually do require personal credit and strong business financials however they can be good for access to smaller amounts of cash which can be good for petty expenses.

Any one of these options may be good for a company that is a established, has strong financials and has a personal guarantor with excellent credit. But what about those companies that are just starting out or have no personal guarantor with excellent credit. This would be probably the majority of business out there these days. Well, there is a way to can a substantial amount of cash for your business if you do not quality for conventional business lines.

Building Business Credit

The absolute best way to build credit for your business is by building your PayDex score with Dun and Bradstreet. By establishing credit in your business name you can build your business to the point where you can easily acquire business credit from various funding sources. Some immediate ways to start building your PayDex score is by establishing net- 30 accounts. Use utility bills in your company name. Apply for a Staples Credit Card. Use your cell phone service in your company name. As long as these account a reporting to Dun and Bradstreet and payments are paid on time, you can get and favorable PayDex score for your business and unlock countless funding opportunities.