Business Startup Pitfalls!

So you want to start a business and need some practical advice huh? You came to the right place! Here are a few things you want to avoid when embarking into the world of entrepreneurship: 

Having Your Head in the Clouds

When you think of opening your own business do you dream of sleeping late, money rolling in, vacationing when you want to and no one telling you what to do? Mmmm… hmmm.  Now wake up! Owning a business is hard work…. Let that sink in. It’s hard work, early mornings, late nights, less vacations and many a day the money may be a figment of your imagination. That’s why I advise clients to create a business from something they are passionate about… you will need to tap into that love on the bad days.  Successful businesses are not instantly created - the hard work will pay off in the long run, but you will have to stick it out!

Not Enough Planning

You do need a business plan, albeit you don’t necessarily need a 40 pager to get started if you are funding the business yourself. But you do need a WRITTEN plan of how you will run your business, how you will pay for it and how you will tell the world about your business.  For a new business that isn’t looking for outside funding I would suggest at least 1 – 2 pages detailing each of the following:

Financials – Startup costs, a 3 – 5 year forecast and cash flow planning.  Create a realistic schedule of how many products you will sell or how many clients will you see as a new business.

Marketing – Don't depend solely on free Social Media avenues to market your product or service. What will you do to spread the word and how much will you allot for your marketing budget? Yes, you need a marketing budget… not just in name, but also funded.

Processes – What happens in your operations from the time a customer/client contacts you to the delivery of product or service? How will you create, manufacture, deliver your product?

Too Much Planning

You’ve read the books, gone to the seminars, taken the notes, written and re-written the plan– now it’s time to MOVE!  Elbow grease time - develop a timeline and put the PLAN TO WORK!

Going It Alone

You may start out as a one man band, but you don't want to stay that way. Have a plan for hiring staff or outsourcing services needed to run your business?

Also line up a board of advisors. Who will help you ‘see’ what’s going on your business when you can’t? You need objective voices that aren’t involved in the day to day operations to give you sound advice.

Then there are your paid professional advisors. Yes, money may be tight initially – especially if you bootstrap in the beginning, but  you will need at the minimum an accountant, attorney, bookkeeper and assistant.

Skipping the Number Crunching

Ahh yes.. you knew the Money Lady was going to park here a minute.  The math is important – don’t just leave it up to your accountant - know how to read/evaluate your financial statements. Know how to enter transactions into your accounting software. Better yet – how are your personal finances? You may  will have to tap into your personal money to fund your business, if there’s nothing there you are going to be in trouble.  Begin to develop a plan in your personal finances for tracking and budgeting so that you always know what you have and how much you can allocate to your business.

- Dorethia
www.connercoaching.com

What is #MoneyChat?!

On Monday nights my co-host, @BenitaTyler, and I (@DorethiaConner) discuss all things money! That's right, you can 'tune in' to our weekly Twitter conversation #MoneyChat held from 8pm-9pm ET and add your two cents.

We interview guests or answer personal finance, tax, accounting, entrepreneurship and various other business questions ourselves. Since a conversation can't be one sided - we invite the #MoneyChat fam to comment on the Q & A as well - sharing what has or hasn’t worked on their money quest. Each week there’s a new topic and in 2011 we’re getting out of debt.... so there’s HOMEWORK involved!!

We use Tweetgrid ←(Check out Benita’s fancy how-to vid) to keep up with all the questions and answers. You can also use the Twitter search feature (search.twitter.com) your Twitter page or a Twitter application like Hootsuite or Tweetdeck to follow and add your input. Just look for the the hashtag (#) + moneychat = #moneychat. We look forward to 'seeing' you on the chat!

Interested in being a guest on #MoneyChat? We'd love to have you! Email info@connercoaching.com and we’ll send you the guidelines.

A Few of Our Past #MoneyChat Topics:

Grants De-Mystified for YOUR Non-Profit or For-Profit Biz! http://t.co/uUOQ1XB

Taxes: Getting the Biggest BANG for your BUCK! http://t.co/PCXSoor

We're Getting Out of Debt! Week 2 - Business Debt! http://t.co/VxtV2S8

Getting College Cash! http://t.co/szKPUYp

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Dorethia Conner, MBA: Personal Finance and Small Business Coach

www.connercoaching.com | dorethia@connercoaching | 800.962.2491

Benita Tyler: Tax, Accounting and Women Owned Business Consultant

www.tbsusa.com |  btyler@tbsusa.com | 888.380.1112

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Monday nights 8-9p.m. est.

@dorethiaconner  &  @benitatyler

NFL Players: How Will You Fair Financially in a Lockout?

With a pending NFL lockout looming, players have some serious financial decisions to make. Most of what we hear about is the excessive spending of athletes, but not the nuts and bolts of their expenses. True enough, many do make foolish financial decisions - also true is that less of them are multi-millionaires than we think. So for those who have been living extravagantly and those who are keeping their heads on straight – I’ve compiled a few suggestions for waiting out the lockout…

Review Your Expenses. Duh, I know. Create two lists – one of all your current monthly/annual expenses and another with only your necessities. Think about things like household expenses, mortgage, insurances, autos, tuition, medical, professional expenses, etc. Look at your bottom line of both lists– do you have enough in savings to live a season with no pay and also prepare financially for the days when there’s no more football? Cut, cut, cut!

Family Meeting. Have a ‘real talk’ session with your family – let everyone know we're scaling back. No new cars, no expensive trips… teach everyone the word ‘staycation’. Skip the shopping and major purchases. Truth be told, everyone probably has everything they need in the way of clothes, cars, etc. Enjoy what you already have for a while without buying new.

Side Gigs. Brush up on your speaking skills – event planners for universities, conferences, etc. would be glad to have an NFL athlete or his wife, give an inspiring message.…you got it - everyone needs a side gig! What are some other ways you can maximize your celebrity? If you have already started a business – what can be done to accelerate increased revenues this year?

Casanova? Chill on the ladies – wining and dining adds up – so do paternity lawsuits…enough said.

Keep It Real. If you are among the 20% of NFL players who has no savings it’s time for immediate action. Do all of the above in addition to downsizing your home, selling what you can in the way of cars, artwork, stocks, etc. I know this is a tough call, but it’s necessary to right-size your finances.

Entourage... Athletes and entertainers are always criticized about their ‘crew’. Those on the outside looking in don’t know what some of these people may mean to you. While I will admit there are many who aren’t around for the right reasons, I also know that you can’t make a general statement across the board. So, my advice on the entourage is to truthfully evaluate those in your circle - going everywhere you go, while you foot the bill. Outside of security, who is really necessary? If they must hang with you, why can’t they pay their own bill?  I’d even say they could treat you once in awhile. I’m just sayin’.  Do the math – how much do you spend on those around you that are not immediate family? They may need a ‘real talk’ conversation too.

Ryan Mundy from the Steelers is a perfect example of the reality of many NFL Players who are responsible financially and aren’t millionaires: http://bit.ly/i7TCP1

-Dorethia


Dorethia Conner, MBA: Personal Finance and Business Coach

www.connercoaching.com | dorethia@connercoaching | 800.962.2491| 248.325.8016

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Financial and Business Coaching Available Nationwide!    

Economics of an NFL Lockout Hit Home

When you think about the idea of an NFL Lockout, initially you may wonder what you will do with your Sunday and Monday nights. What will replace the fun of haggling over fantasy football and whoa....no SUPERBOWL! The nerd in me then begins to do the math and follow the money. There’s a lot of talk about what that the wealthy will lose, but what about all the people who help make it happen?

• Team personnel could lose their jobs.

• Empty stadiums = no concession workers, ticket takers, janitors, clerical staff, etc. etc.

• Parking structures, lots near the stadiums, shuttle services, wholesale hot dog suppliers, local hotels and restaurants would lose money, thus their employees could lose their jobs.

• Yes, television networks that carry the games would lose billions in ad revenue (CBS, ESPN, Fox, NBC and the NFL Network) - professionals assigned to those ad accounts would not be needed.

• What about the distributors and local retailers of the jerseys, mugs, video games? They won’t be happy either.

This list is only the beginning. Many numbers are being tossed around – one being that each city that hosts an NFL team would lose $160 million dollars. Not sure if that’s correct or not, but there’s no doubt that each city would certainly lose millions.  In this recessionary economy - not exactly what we need.

For those whose work is related to the NFL – start thinking of alternatives. Hopefully, a reasonable agreement for both can be reached, but if not, you don’t have millions or billions to rely on.

Wondering what all the fuss is about? Check out this article from Theweek.com http://bit.ly/fHjU0c

-Dorethia

Dorethia Conner, MBA: Personal Finance and Business Coach

www.connercoaching.com | dorethia@connercoaching | 800.962.2491| 248.325.8016

_______________________________________________________________________________

Financial and Business Coaching Available Nationwide!    

Tax Tips for Freelancers

Many freelancers and business owners have questions when it comes to their taxes. Who better to help you navigate the murky waters than Benita Tyler of TBSUSA Accounting? Check out Benita's tips below!

There is a lot of flexibility in business ownership. When to work, who to work with, and the type of work that you do are all great benefits. But even with the freedom to create the business of your dreams there is still a need for know-how. It is important to have insight in areas such as tax compliance and regulations to help you reduce your tax bill. Here's how E.S.P. helps you achieve great tax results in 3 simple steps!

E - Expense Classification

In addition to the opportunity to increase income you may have noticed another benefit of self-employment. If you are like others who start their own company then you likely realize the tax savings from writing off business expenses. This is an area that can be confusing when you do not understand where to draw the line. For example, if you work from home the Internal Revenue Service allows deductions for the business use of your home. In most cases there is only a certain percentage of the expense that qualify for the business deduction. Knowing what deductions are available to you makes the difference in how much you end up paying when you file your return. If you are unsure of what expenses to claim, speak with an accountant to get more advice.

S - Scheduling Payments

There are several types of taxes that may apply to you as a self-employed person. Examples include self-employment, income, sales, and payroll taxes. Depending on how your company is set up you may need to remit one or all of the taxes above. It is important that you understand the filing requirements from a federal, state, and local level. Get a tax calendar to track the schedule for filing forms and sending in payments. Failure to do so can lead to hefty tax penalties which means fewer tax savings for you.

P - Procedures and Payments

Another pitfall that is common to self-employment is overpaying income and self-employment taxes. Planning and good math are keys to successfully reducing taxes. A simple improvement that can make a big difference in how much tax you pay is putting the right financial procedures in place. The more thorough you are in tracking your financial activity the better off you will be when it comes time to file your taxes. This way you are not over reporting income or under reporting expenses.

It is important to be familiar with the tax rules that govern self-employment. Using this simple model will keep you in compliance and help you lower your tax bill

More questions? Contact:

Benita Tyler
Phone: (888) 380-1112

www.tbsusa.com

Nationwide Tax and Accounting Services Available