Becoming a Franchise Owner; Having Realistic Expectations

There are two words used in the franchise industry that can be downright dangerous for some folks that are considering franchise ownership.

The words that I’m about to share with you are what I call, “visual words.” You’ll “see” why, in a moment.

The two words that I’m referring to are “turn-key.”

What was the first picture that came into your mind when you saw those two words?

For me, I saw a key going into the door of an anonymous retail or food franchise. Then, thoughts of instant business success soon followed in my little franchise vision. 

Now, I’m going to attempt to snap you out of your own personal franchise vision that you undoubtedly had when you read the words “turn-key.” Snap!

A “turn-key” business doesn’t mean that everything is all setup for you. It also doesn’t guarantee that you’ll own an easy business to run.

When you purchase the rights to a franchise business, even if the marketing/advertising literature (online or offline) says that you’ll be buying a “turn-key business,” please remember that it’s you that’ll be “turning the key.” (Every day.)

Business.gov contributor, *Caron Beesley, reminds us, “franchisors and franchise associations are very good at persuading would-be franchisees that franchising is generally a lower business risk, than independent business ownership.” Read what else Caron says about a franchise.

I happen to feel that buying a franchise can be lower risk than doing a pure start-up business, in the right situation.

                                    The Right Situation

• The would-be franchise owner has the right personality for a franchise-type business.

• The prospective franchisee’s family fully buys into the idea.

• The geographical location is right for the franchise business that’s been chosen.

• The financials of the prospective franchisee are strong.

If you’re going to start exploring becoming a franchise owner, please make sure that you remain grounded. By “grounded,” I mean that you need to have realistic expectations of what your “franchise life” is going to look like, and feel like.

If you think that all you’ll have to do is “turn the key,” you will have a rude awakening. (Rude awakenings in franchising usually come into play around month #6.)

Your life as a franchise owner will have its ups and downs, along with some twists and turns. It’s not going to be easy. You’ll be working harder than you ever have. Your stress level will enter the red zone. You may doubt your own abilities if the business takes longer to become profitable than you thought it would. (If you *talk with existing franchisees before you sign your franchise contracts, you’ll find out when you can expect the profit to start trickling in.)

On the positive side of the franchise ownership ledger, you’ll be (in most cases) glad you did it. It’s a great feeling to finally be more in control of your own destiny. Working for yourself beats working for someone else, hands down. There’s just a certain power to it, and you won’t know it until you try.

The money part can be good too! Once you become profitable, thoughts of growth will become your new visual. Maybe you’ll become a multi-unit franchisee. Who knows? You’ll have options. Options are nice to have.

As long as your expectations of life as a franchise owner are realistic, and you can be patient while your new franchise business ramps up, the decision to be more in control of your life, via franchising, will be one of the best decisions you’ve ever made. 

Does your Website Need a Refresh? – 6 Tips for Keeping your Site Relevant and Engaging

To the outside world your website is the equivalent of your storefront, and your customers expect it to be eye-catching, well-maintained, and always offering something new. However, when you’re on the inside and are caught up in the day-to-day operations of your business, finding the time to focus on your website is easier said than done.  And, like a neglected storefront, it can quickly become out-of-date, unappealing and, at worst, ignored.

Here are some tips to help you keep your website up-to-date, relevant and attracting customers.

1. Does your Site Meet Your Business Objectives?

It’s likely that you know your website intimately.  You helped get it started, had a say in the design, content and so on. You might even live and breathe your website. But it’s a good idea every now and again to step back a bit and assess your website in  light of where your business is and where you want it to be. Does your site reflect your brand and corporate culture? If not, it should.

For example, when you started your business you may not have had a huge budget to invest online and built a skeleton site that had basic information about your business and its products and services. But does that start-up site still meet your needs?

Do you have things to say about your business that you aren’t doing through your website right now? For example, if you hold special events, offer regular specials or discounts, are you using your website to promote these?

How do you keep your customers “in the know” using your website? Have you considered a blog, or using social media to help engage with and even educate your customers in a “social” way?

Take a look at what your competitors are doing. Do some sites seem to work while others don’t? Where’s does yours fit in the line-up and what do you think you could do differently?

2. What do Your Customers Think?

Don’t forget to ask your customers what they think of your site? Do they visit it? Does it appeal to them? What don’t they like? How can it be made more useful to them?

3. Add some Bells and Whistles

If you determine that your website meets your needs, but just needs a mini shake-up to help you meet your objectives, consider introducing these elements:

• Add Lead Capture Devices – Use your website to get more information about your customers, and offer them something in return – whether it’s a newsletter subscription, a white paper, or just another download. Use the data to establish regular communications and outreach to your customers. But be sure to adhere to SPAM laws and customer privacy laws.
• Start a Blog –A blog isn’t right for every business, but it is a great way of keeping your site fresh and engaging.  And because search engines love new content, a well maintained blog can help boost your rankings. Well written and thoughtful blogs can be a great way to introduce the human element of your business as well as position you as a trusted expert in your field. So whether you offer tips, how-tos, or share success stories of how you’ve helped your customers – just about every business owner has expertise and insights to share. To get you started read: “Thinking of Starting a Blog? Tips to Help You Start, Maintain & Grow a Small Business Blog”.
• Embrace Social Media – Another great way to generate traffic back to your website and get the word out about your business (what you offer, what’s new, what’s going on) is to get out there on social networking sites.  To help you determine, which social media channel is a good for your business, read “ Twitter, Facebook or LinkedIn? Finding the Right Fit for Your Small Business” and get started with this “Ultimate Small Business Guide to Social Media Marketing”. Of course, don’t forget to add links and icons to your website that let people know that you are active on social media.

 4. Rearrange Your Site Architecture / Design

Whether you need to improve your site navigation to help people find the information they need, or you have new content (such as a blog) that you want to showcase, make sure your site architecture easily supports this. Many content management systems make it easy for site managers to do this without the help of a web developer. But be sure you have that capability before you start out.

5. Get Outside Help

If you don’t have experts on staff, consider hiring a consultant to do the job. This one-time investment doesn’t have to break the bank and might be worth it. Remember, to make it easier for you to manage and make changes to your site down the line, make sure your designer builds a site that has a robust and easy-to-use content management system (CMS) on the backend.  This article provides some basic “need-to- knows” about CMS options: “How to Find the Right Content Management System and get More Out of Your Web Site”.

6. Measure Your Improvements

As you roll any changes out, use free website analytic tools to measure and monitor site traffic and assess ROI. How are people finding your site? What pages are attracting most interest or otherwise? Why?

Six Tips for Rewarding Employees When Cash is Tight.

As small businesses have struggled to survive during the recession, it has been difficult to reward employees with raises and/or bonuses.  In fact, many small firms found it necessary to cut employee salaries, perks and benefits in order to survive financially.   As we approach the end of 2010, the picture doesn’t appear to be appear to be getting any better.  Only a small percentage of small businesses say they’ll be offering salary increases this year.  And those who do, plan for the increases to be very small.

So how can you reward employees for outstanding performance without breaking the bank?   Here are some ideas that can help you reward and motivate your team without breaking the bank.

Cash vs. Recognition:  Research has confirmed that many employees are motivated as much, if not more, by recognition as they are by cash.  Personally, I know people who make a good salary and regularly qualify for bonuses, but they are miserable in their jobs.  On the other had, I also know talented individuals who work for less money than they might earn somewhere else because they enjoy their work environment and feel as though they are recognized for their contributions.  As a result, they are loyal and committed to the companies with which they work.

Reward Throughout the Year:  A lot of companies fall into the pattern of rewarding employees once a year -- usually in conjunction with a performance review. A better approach is to reward your team sincerely, and freely throughout the year.  That helps motivate your team and keep them energized.

Make it Public.  Don’t recognize employees behind closed doors.  Do it publicly.  Everyone enjoys  being acknowledged for their efforts in front of their peers.

Give the Gift of Time.  As the mother of four step-grandchildren, I can tell you the gift of time is as appreciated as expensive presents.  The same is true with employees.  Give a high-performing employee an extra day off or allow him or her to work a flexible schedule.  You may want to consider offering the employee an opportunity to tele-commute for all or part of the work week.

Be Spontaneous:  Rewards and recognitions don’t have to be dolled out at specific times.  Be spontaneous and fun.  And don’t do the same thing all the time.  Shake things up.  For example, bring a massage therapist into the office as a special reward or have an outstanding employee’s car washed on site.

A Small Thank You.  Small gifts bring big smiles as a thank you for a job well done.  A gift card to a favorite restaurant or spa could be a nice treat.  Tickets to a sporting event or theatre performance are also a nice way to say thank you. Remember, you can get discounted certificates on many websites so you don’t have to pay full price.

Most employees understand the current economic climate and will appreciate your creative efforts to recognize their contributions.

http://community2.business.gov/t5/The-Industry-Word/Six-Tips-for-Rewarding-Employees-When-Cash-is-Tight/ba-p/43393

Section 179 Deduction

A company should consider leasing rather than buying certain business equipment. Leasing may offer increased tax advantages. Under Section 179 of the IRS Tax Code a small business may deduct the full price of leased or financed equipment, according to Section179.org. In some cases the deduction will be more than the total loan or lease payments for the year. Most equipment qualifies for the Section 179 deduction. However, the equipment must be leased within dollar amounts specified by Section 179.
Being aware of federal tax laws can help a business make wise decisions regarding workers and managing business assets. The more a business owner knows about taxation rules, the more the company will be able to save money and maximize assets and resources.


Read more at Suite101: Money Saving Business Tax Tips http://www.suite101.com/content/money-saving-business-tax-tips-a300736#ixzz13OajVjDV

Section 530

If a company wrongly classifies a worker, it may still avoid employment tax under Section 530 of the Revenue Act of 1978. The IRS auditor will provide written notice of these provisions. Section 530 relieves business tax but not worker’s employment tax liability. The consistency test and the reasonable basis test are the two requirements for Section 530.
The consistency test requires a business to have treated all workers in similar jobs in the same manner as workers in question, according to the IRS website. The reasonable basis test requires that a company treat the worker as a subcontractor due to relying on a court case or ruling, a prior IRS audit, a long-standing industry practice, or any other reasonable basis for treating the worker as a subcontractor.
If a business is unsure about whether it should classify a worker as an employee or a subcontractor the company can request an IRS opinion on your situation, according to the IRS website. A Form SS-8 may be filled out and sent to the local IRS office.


Read more at Suite101: Money Saving Business Tax Tips http://www.suite101.com/content/money-saving-business-tax-tips-a300736#ixzz13Oae1LuE

Worker Classification

Correctly classifying workers as employees or independent contractors may help avoid future conflicts with the Internal Revenue Service (IRS). If the IRS finds a worker has been misclassified, a company may have to pay for missed employee tax benefits, according Tax Resolution University. The IRS loses over $14 billion per year due to underpaid employer taxes. Some businesses may incorrectly classify workers to avoid paying for health insurance and 401K plans. Other business owners may simply be ignorant.


Read more at Suite101: Money Saving Business Tax Tips http://www.suite101.com/content/money-saving-business-tax-tips-a300736#ixzz13OaZqrTB

Subcontractors vs Employees

There may be tax advantages in using subcontractors rather than employees for skilled or semi-skilled services. Using subcontractors rather than employees can shield a business from employer paid taxes, such as Social Security and Worker’s Compensation Insurance, according to Financial Web.


Read more at Suite101: Money Saving Business Tax Tips http://www.suite101.com/content/money-saving-business-tax-tips-a300736#ixzz13OaSqEux

Timely Tax Payments

A business can save money by paying certain taxes on time. Many states will award a 3% to 5% discount for timely payment, according to Financial Web. Some of these taxes may include value-added taxes or state sales taxes.


Read more at Suite101: Money Saving Business Tax Tips http://www.suite101.com/content/money-saving-business-tax-tips-a300736#ixzz13OaMNwrC

Small Business: Loans and Grant & Financing FAQ's

Financing FAQs 

Starting a business can be daunting, as you wonder how do you put yourself in the best position to succeed. The answer is simple: you begin with solid information. Check out some of the frequently asked questions below to get yourself off to a solid start. 

Can I use a grant to start my business?

Generally, no – despite what you may have heard, it is rare that a for-profit business would receive grant money to start or expand a business. 

While there are a few grants available to small businesses, they are largely directed towards accomplishing specific priorities identified by the federal government or a state government agency.  For example, some states provide grants for expanding child care centers; creating energy efficient technology; and developing marketing campaigns for tourism. These grants are not necessarily free money, and usually require the recipient to match funds or combine the grant with other forms of financing such as a loan.  

How can I find a legitimate loan or grant?

There’s a sea of misinformation about business loans and grants on the Internet. Use Business.gov’s Loans and Grants Search Tool as the starting point for finding legitimate financing programs your small business might be eligible for. Keep in mind, for-profit businesses are rarely given government grants and should look to low-interest loans or venture capital financing if you’re wanting to start or expand a business. 

Grants.gov is also helpful for finding thousands of federal government grant programs, or the Catalog of Federal Domestic Assistance, which offers a comprehensive database of grants, loans and other assistance programs available from federal agencies.

I have bad credit - can I still get a small business loan?

With the state of the economy and lines of credit being significantly scaled back or eliminated altogether, loans have become increasingly hard to obtain - especially if you have poor credit. Luckily, the government has designed federal and state loan guarantee programs for people unable to obtain financing through traditional lending channels.  In many of these programs, the loan proceeds can be used for most business purposes including working capital, machinery and equipment, land and buildings, leasehold improvements, and debt refinancing. Before you apply for a loan, you should pull together the basic documentation you will for your application.

What happens if I default on my loan? 

While it’s not the end of the world, defaulting on your loan will definitely have some immediate effects like a drop in your credit score, increased interest rates, and foreclosure of property - and it will definitely make it more difficult to find another loan (should you need to in the future). 

If you are about to default on a loan, you may want to consider some of the tips offered in the Loans and Grants Community, like negotiating new terms with your lender, considering government debt relief options, or liquidating some of your business assets. Also, if your business will make it or break it depending on a loan then you may want to try looking into other methods of funding your business. 

Source: http://community2.business.gov/t5/Small-Business-Cents/Loans-and-Grant-amp-Financing-FAQ-s/ba-p/38620?cm_mmc=GovDelivery-_-101310-_-weekly-_-community

4 Ways to Combat the Isolation and Loneliness of Being Your Own Boss

Making the move into business ownership can be one of the most exciting and liberating experiences, however, it can also be one of the most challenging.

Yes, you can expect to work long hours and deal with cash flow issues in the early years, but one aspect of business ownership often comes as a surprise, and, if not managed carefully, it can become all consuming.

I’m talking about the sense of isolation that comes from going it alone.

It’s a common experience for many small business owners particularly for sole proprietors or home-based business owners.  But it’s also especially true of business owners who have chosen to leave their nine-to-five jobs to pursue their dream.

Gone is the nurturing team environment and the motivation that comes from working with others. And while many people work better alone, for others the pressures of business ownership can leave them feeling overwhelmed, isolated and alone – impacting both their work life and their personal lives.

Whatever your business type or wherever you work, here are some tips for managing the trials and tribulations of working alone and being your own boss.

1. Make Networking Work for You


Love it or hate it, networking in business is essential. Whether you are an independent contractor; a home-based business owner; or have a fully-fledged presence on Main Street – networking can get you out of the day-to-day silo of business ownership and help you overcome your sense of isolation.

The trouble is, networking gets a bad rap – it’s perceived as schmoozing, if not downright self-serving. But the truth is networking can be invigorating and rewarding. Humans are social beings.  They thrive on contact, shared experiences, and helping others. Even if you just hook up for a coffee with a former college buddy who has also taken a similar path into business ownership – the opportunity to share and learn from each other can help alleviate the sense of being alone in business.

2. Find a Mentor, or Become a Mentor!

A mentor is someone who has been in your shoes, and successfully walked the walk of business ownership. He or she  can provide informal advice, guidance, and motivation. But how do you find a mentor?
Sometimes it’s a matter of getting to know fellow, non-competing business owners or seeking the free mentoring services of a professional association such as SCORE or your local SBDC.

Alternatively, could you become a mentor?  Mentoring a protégé can be a mutually beneficial relationship that places value on your experience and provides a reason for you to focus on the positives, share your wisdom, and place some perspective between you and your day-to-day business operations.

3. Take the Weight off Your Shoulders - Build a Team Focused on Collective Success


"Very few people are ever successful or a failure by themselves, and probably, one of the most powerful elements in creating success - is a powerful team." Laurie Benson, CEO of Inacom Information Systems and 2009 "SBA National Women in Business" Champion.

In business, powerful teams not only drive results, they empower, challenge and motivate employees to learn, grow and participate in the collective success of the business itself.  If you are an employer, changing your management style to focus on building an empowered and motivated team can help alleviate the stresses and strains of solo business ownership, and even help your bottom line.

4. If you Work from Home - Take Control of Your Demons and Distractions

One of the symptoms of feeling isolated as a business owner is a lack of motivation which can lead to easy distractions and a lack of productivity. This is especially true for home-based business owners who wrestle with: 1) Working in a physically isolated manner, and, 2) Managing the conflicting demands of business and home-life.

Taking steps towards managing your home-based business routine, your workload, and your day-to-day schedule can have a big impact on how you cope with these demands, and provide much-needed time on your calendar to step away from “going it alone”.

Source: http://community2.business.gov/t5/Small-Business-Matters/4-Ways-to-Combat-the-Isolation-and-Loneliness-of-Being-Your-Own/ba-p/38322?cm_mmc=GovDelivery-_-101310-_-weekly-_-community

Got a home office? Here are some tips for you...

If you are a Sole Proprietor with a home office, you must file Form 8829, Expenses for Business Use of Your Home. The purpose of this article is to help you prepare this form without getting a headache.
This article makes three assumptions about your business:

1. Your Sole Proprietorship is not a in-home daycare facility;

2. Your business has a profit that is greater than your home office deduction;

3. You do not have any home casualty losses to deduct.
Here’s a list of the information you need to properly complete Form 8829. After each item is the line on the form where that number is reported.
1. Square footage of your home office (Line 1)

2. Square footage of your entire home (Line 2)

3. Mortgage interest from Form 1098. Your lending institution is required to send you this by January 31. (Line 10)

4. Real estate taxes on your home (Line 11)

5. Homeowner’s insurance premium. For both real estate taxes and homeowner’s insurance, if you pay these as part of your monthly mortgage payment, these amounts should be reported on Form 1098. If you pay either the taxes or insurance yourself, then you’ll need to track down those amounts in your checkbook register. (Line 17)

6. Rent payments, if you are renting rather than buying your home. (Line 18)

7. Repairs and maintenance expenses. This can include the typical expenses most homeowner’s incur to keep their home in good shape, such as fixing a plumbing problem or repairing the water heater or furnace when they break down. Just be careful not to include major improvement projects like a new roof or bathroom remodel. Those are not considered repairs or maintenance. (Line 19)

8. Utilities expenses. This includes electricity, gas, water, sewer service, and trash disposal. It does not include telephone service. (Line 20)

9. Other expenses, such as neighborhood association dues and other miscellaneous household-related expenses not mentioned already. (Line 21)
After you put the square footage amount on Lines 1 and 2, you will divide Line 1 by Line 2 to calculate the business use percentage on Line 3. Then carry the Line 3 amount down to Line 7. This percentage is what determines how much of the various expenses will actually become a deductible business expense.
For example, if you have a 150 square foot office and a 1,500 square foot home, your home office occupies 10% of your home and so you will get to deduct 10% of all the expenses listed above.
The next step is to list all those expenses on the various lines listed above, using column (b) Indirect expenses. Then you add up all those expenses on Line 22 and then multiply that total by the business use percentage from Line 7, putting the result on Line 23. The Line 23 amount is then carried down to Line 35, and then you transfer the Line 35 amount to Schedule C, Line 30.

Source: http://www.bestarticle.org/finance/how-to-prepare-form-8829/

Tax Tips for Domestic Partners

It is good practice to keep separate bank accounts. This seems odd, since most people who are partners end up with joint accounts. Here is the catch. To apply for a deduction you will need to prove that you actually paid for that expense yourself. In the event of an audit where joint accounts have been used, it cannot be proven who actually paid for the expense. So it makes better sense to hold separate accounts. Use these accounts to pay for your expenses that you will deduct at tax time. This way there is no confusion as to who actually paid them.
If your partner does not work you can claim him or her as a dependant for an extra exemption. To do so your partner must have been living with you for a year, have income less than the personal exemption amount and receive at least 50 per cent of their total financial support from you.

Source: http://business.ezinemark.com/state-income-tax-filing-online-is-the-best-way-for-us-tax-payers-16b9d1c8979.html

House for sale - Increase home value with little expenditures

For those who have chosen to sell their house, it can be extremely hard to increase the value of the home without spending a fortune. A lot of money is needed just for a simple one-room overhaul. Often, the renovation can cost more than it increases the home’s worth. But there are several cheap and easy ways to improve your home’s worth.
Since the view of the font yard is the initial thing seen, it should be first on your “to-do” list. The lawn should be cut, and the garbage picked up. There should be no stray plants or tall grass around lawn accents, along walls, or along walkways. Flower beds should look fresh and shrubbery should be cut back. Planting new shrubs and perhaps a statue or a trellis will also enhance the lawn’s appearance.
Once you are finished outside move inside the property, begin by organizing. Getting rid of any clutter you have acquired over the years will make the house look neater and more welcoming. Getting a storage unit for the items you wish to hold on to is a great idea. This will cause the house to look bigger and more elegant.
The walls and windows of the home should also be cleaned. This is a much cheaper method than purchasing new siding or paint. It is much more budget-friendly to power wash the outside and clean the inside than it is to replace or repaint. However, patchwork and a paint job is necessary for any walls which are dimpled or mottled.
Wood trim is another inexpensive way to make your home look more elegant. The taste of the home can be enhanced very easily with this method. Keeping walls a muted color against a brighter trim work can open up the room.
These tips will help make your home more desirable on a budget. While examining your work, remember one important tip. Imagine you are seeing your house for the first time, and take note of the small things. Does the house look like something you would want to buy? Remember that the buyer will be ready to live in the home, and will not be interested in a house if it has to be fixed

Source: http://taxliens.mikestaxlientips.com/?p=1704

Real Estate Tax Tips - Maximize Your Real Estate Tax Deductions

Real Estate Tax Tips - Maximize Your Real Estate Tax Deductions
In most cases, your mortgage payment includes taxes, and if you have high LTV (loan to value ratio) loan, it probably includes mandatory private mortgage insurance (PMI). These costs are tax deductible, so don't let your accountant miss them!
Regardless of what the market says about your rental property's value, Uncle Sam is willing to view it as a depreciating asset, and you can deduct the depreciation! This gets complicated, so consult your accountant, but the gist of it is that the government sees the depreciation as a 27.5 year-long decay in the value of your rental property


Source: http://business.ezinemark.com/state-income-tax-filing-online-is-the-best-way-for-us-tax-payers-16b9d1c8979.html