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  • Steps To Small Business Start-Up - Everything You Need To Know To Turn Your Idea Into A Successful Business (PDFDrive)

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    Steps to Small Business Start-Up

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    Steps to Small Business Start-Up_ Everything You Need to Know to Turn Your Idea into a Successful Business ( PDFDrive )

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    Steps to Small Business Start-Up

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
    Flag for inappropriate content
    104 views274 pages

    Steps To Small Business Start-Up - Everything You Need To Know To Turn Your Idea Into A Successful Business (PDFDrive)

    Uploaded by

    Obukohwo Oke
    Steps to Small Business Start-Up

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
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    Authors of the SBA publication How to Write a Business Plan Steps to Everything You Need to Know to Turn Your Idea into a Successful Business Sixth Edition Steps to SMALL BUSINES START-UP Linda Pinson ¢ Jerry Jinnett Everything You Need to Know to Turn Your Idea into a Successful Business KAPLAN) PUBLISHING “This publication is designs to prove acurate and authoritative information in roar to the subject smarter covered, I issold with the undeestanding shar the publisher not engaged in rendering eal or other profesional service legal advice or other expert assistance srequied, the ser ‘ces of competent peofetonal pesto should be sought. President, Kaplan Publishing: Roy Lipner ‘Vice President and Publisher: Maureen MeMabon Senior Acquisitions Eator Michael Conningham Senior Managing Flitor: Jac Kibure Typeseter: Cain Ostrow Cover Desizner Pesan Solutions (© 1983, 1987, 1993, 1996, 2900, 2003, and 2006 by Linda Pinson and Jory Jnnets Published by Kaplan Publishing, A division of Kaplan Ine Allrights reserved. The text ofthis publication, of any par thereof, may not he reroiced in any man ner whatssever without writen permission from the publisher Printed inthe United Staes of America 06 07 08 10987654321 Library of Congress Catalogingin-Publiation Data Pinson, Lind, ‘Steps to snl business startup: everything you need to know to turn your Heino ues tines Linda Pinson an Jey Janet. 6h pew Includes inde. ISBN-13:978-1-4195-5727-1 ISBN-10: 1-4195-3727-X 1, New busines enterprises-United States 2. Stull husinse-United Stats 3. Sucess in business [United Seats Janet, ery. Il Tie HiD82 5.7565 2006 65801122 2006005651 Kaplan Publishing books are avilable a apecal quantity discounts to use for sles promotions, samployee premiums, or edecational purposs. Please cll our Special Sales Department to order o for ‘more information at 800-621-962, ext. 4444, e-mail kaplanpubsles@kpln.com, or write to Kaplan Pohlishing, 30 South Wacker Drive, Site 2500, Chicago IL. 60606-7481 CONTENTS Irivaduction i Acknowledgments Getting Started 1 Examining Your Personal Objectives 1 Exploring Business ideas 2 ening Sl, Interest, and Personal Qualities 3 Evaluating Your Stengths and Weaknesses 4 Finding a Business 9 Developing Your Oun Business 9 Buying an Existing Business 10 Buyinga Franchise 11 Determining Business Feasibility 17 Generating a Viable Business Kea 17 Researching You Market 18, Fding Your Target Market 19 Cotecting General (or Secondary) Data 22 CCompeton 22 ColectingPersoal or Primary) Data 22 Use of uestonnaes 23, Putting Together 25 Choosing a Business Name 35 Natrowing the Search 97 Name Availity 38 Choosing a Business Location 39 Location Evauaton 99 ‘Shopping Genter 41 Business Incubators 42 Enterprise Zones 42 Lease Provisions 43, 10 1" 2 Developing a Home-Based Business 47 How Does a Home-ased Business Der from Other Businesses? 48 Do You Qualify fr aHome-Ofce Deduction? 48 Calulatng Your Deduction 50, Deducting Expenses 51 Increasing Your Chances for Success. 53 IFS Waring: Home-Based Busines Tax Avoidance Schemes 56 Choosing a Legal Structure 59 Sole Propretrstip 60, Partnership 61 Partnership Agreements 62 Corporation 63 ‘SCorporaton 66 Limited Liaity Company (Lic) 66 Incorporating in Your Home Sate versus Another State 68 General Considerations 68 Presenting Your Business 71 Graphiclentty 71 BusinessCards 72 Promotional Maerias 73 Choosing 2 Printer 75 Protecting Your Business 79 Disclosure Leter 79 Jounal 79 Copyright 80 Trademark 82 Patent 85 Contracts 86 Hing Aa Atomey 86 ‘Securing a Business License 89 Location Considerations 89 LUcensng a Home-Based Business 90 ‘Aoniyng fora Business License 9t ‘Aways Post Your Business License 91 Registering a Fictitious Name (Fling a “DBA") 95 IYouFaltoFile 96 How toFleaDBA 96 Renewal of Your DBA. 97 Obtaining a Seller's Permit 101 ‘plying fora Sole’s Permit 101 Purpose ofa Sells Permit 101 B 4 18 16 "7 18 ‘State Laws Vary 102 Nisuse of Your Sellers Permit 102 Resale Cetficate 103 Poporing Sales Tx 108 Setting Up a Bank Account 113 Separate Business and Personal Fnances 115 Open a Checking Account 115, ‘AdGtonal Accounts You May Wish to Consider 116, Selecting Your Insurance 119 ‘Shopping for an Insurance Company 119 The Basic Kinds of Insurance 120 Property and Labi insurance 120 Ute surance 122 Heal Insurance 122 Empioyee Benefits 123, ‘or You Hae Your Inormation 123 Other Considerations 123 Using the Intemet 127 Connecting tothe nore 127 Communicating with Customers and Vendors 129 Searching for Information onthe internet 129, Buying Products and Sarices One for You Business 190 Does Your Comgany Need aWeb Site? 131 Developing Your Company's Web Ste 133 ‘summary 134 Financing Your Business 135 Will You Ned toBorow Money? 135, How Much Do You Neod and When Do You Need? 136 What Are the Sources Avaliable to You? 136 Wich Type of Financing Costs the Most? 143, Caloulatng the Gost 143 In summary 143 Keeping Your Books 145 The Importance of Good Recorckooping 145, ‘Should You Hre an Accounting Profesional? 146 ‘When Do You Begin? 147 ‘hat Records Do You Need to Keep? 147 Keeping the Books on Schedule 151 ‘Success or Failure: It Depends on Your Cash Flow 167, What ls @ Cash Flow Statement? 167, Preplanring Worksheets 168 Cash tobe Pad Out Worksheet 170 Sources of Cash Worksheet 172 Using The Worksheets to Bud the Cash Flw Statement 174 ‘Ace Sparing Goods Cash Flow Statement 176 Directions for Completing a Cash Flow Statement 178 19 Developing a Marketing Plan 181, Product or Service 181 Pace 182 Price 183 Promation 183, 20 Promoting Your Business 187 Media Advertsing 187 Publicity 190 ‘tomatve Methods 190 Marketing on the itenet 193 Cutine fora Marketing Plan 202 21 Business Planning: The Key to Your Success 203, Wiy Should You Wt a Business Plan? 204 Revising Your Business Pan 205 ‘AWining Business Pn Format 205, Anatomy ofa Business Plan Outine 205 The Cover Sheet 207 The Execute Summary 207 Table of Contents 207 Pat: The Organizational Plan 208 Pat: The Markating Plan 208, Part Bk Financial Documents 208 Part: Supporting Documents 208, Appendixes ‘A. Resources for Small Business 209 The Small Business Admiisation 209 (tre Federal Resources 210 Associations and Agencies 210 Books 211 Urry Resources 212 B. Worksheets 215 Glossary 249, Index 255 INTRODUCTION Now, more than at any time in our nation’s history, the economy is being driven by the engine of small business, Hundreds of thousands of new businesses are started every year, and it is imperative that they are properly launched and given every chance to establish their niches in the marketplace of the new millennium, We hope you are pleased with our new edition of Steps to Small Business Start-Up. This hook has been written with the hope that it will provide you, the new small busi- ress entrepreneur, with the information, forms, and worksheets you will need to go through the process of starting your business and laying a proper foundation for the development of a successful business venture. We have tried to present the information in a logical sequence so that you will hhave a guideline to follow as you get your business organized and legalized. Howev the procedures and requirements may vary slightly according to your location and industry, We would suggest chat you read through the entire book one time and then. 0 back and begin the process of forming your business. Forms, examples, and worksheets have heen included in the book for your conve- rience. They may be duplicated for your own use but nor for commercial purposes We have written Steps to Small Business Start-Up based on our experiences as busi- ress owners. We have also incorporated information and feedback from the thousands of seudents, users of our books, business professionals, and other small busi- ness owners with whom we have been fortunate enough to interact over the last sev- eral We hope that you will benefit from this book and that it will provide you with the motivation and knowledge to take your idea “out of your mind . and into the marketplace.” Best wishes for a very successful small business —Linda Pinson and Jerry Jinnett “ ACKNOWLEDGMENTS Kaplan Publishing would like to acknowledge the works of Small Business Develop: ment Centers (SBDCs) around the country for their untiring support of start-ups and small business owners. Many SBDCs provide high-quality materials, such as Steps 10 Small Business Start-Up and other titles, to enhance the training and counseling of entrepreneurs in their state. This is the type of public/private partnership that will make today’s small businesses prosper. Other books and software by Linda Pinson Anatomy of a Business Plan Aut ur Business Plan (software) Keeping the Books CHAPTER Getting Started Everyone has dre that come into our minds but never quite make it into the marketplace. It has been said thar an entrepreneur can best be defined by the following thought: All people Ihave great ideas while in the shower, Most of us get out of the shower and forget about them, The entrepreneur is the person who gets out of the shower and acts on those ideas. However, you will increase your chances of success if you ask some tough ques «dof owning a business. At one time or another, we all have ideas tions before acting, What is my reason for starting a business? What type of business I start? What skill, in ind personal qualities will be able to business? What are my strengths and we ing to the nesses as a business owner? @ EXAMINING YOUR PERSONAL OBJECTIVES Begin with examining why you wane to start a business, People come to business owner- ship for a variety of reasons, They want to “be their own boss,” “build a furute,” “follow the American dream,” “ear lots of money.” Look closely at why you want to start and run a business. What are your motivating factors? ‘There seem to be two schools of thought regarding business ownership: 1. Choose a business with great profit potential. Afterall, why would you go into business if not to make a lot of money? 2. Choose a business that you love. If you can’t enjoy the work, why do it? If profi is your motivation, take a close look at what that means. A business must be able to cover all ofits costs, pay for all ofits expenses, cover the owners’ personal financial needs, and have enough net revenue left to allow the business to grow. Focus 2 SupstoSralbusness Sta-p oon the role this business will play in your personal financial situation, Will this business provide you with a full income? Will che business supplement your current income? Before going much further, itis necessary co look at what your personal financial needs are. A Personal Monthly Expense Worksheet has been included on page 6 to help you determine your total living expenses. This will help determine your owner equity or

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