Insurance for Small Biz

Another great suggestion to come out of last night's small business start up presentation was the type of insurance that may be necessary for a small business.

Depending on the legal business structure, you may be personally liable for any claims of damage, defective product, breakage, loss of client revenue, etc.  Examples include computer consultants that should probably carry errors and omissions (E&O)  insurance.  This is an insurance form that protects the insured against liability for committing an error or omission in performance of professional duties. Generally, such policies are designed to cover financial losses rather than liability for bodily injury and property damage.*

A second general common business insurance policy is broad form comprehensive general liability (BFCGL) endorsement.  This insurance is a comprehensive endorsement to be attached to pre-1986 editions of the standard general liability policy that provided coverage enhancements including blanket contractual liability; personal injury and advertising liability; premises medical payments; host liquor liability; fire legal liability on real property; broad form property damage liability, including completed operations; incidental medical malpractice; nonowned watercraft liability; limited worldwide coverage; additional persons insured (employees); extended bodily injury coverage; and automatic coverage for newly acquired organizations.*

Insurance policies are vital if:

A) You have personal assets you might lose in a legal judgment

B) The legal structure is a Sole Proprietorship or S-Corp where no corporate protection exists

Consider carefully your risks and whether you can sleep at night without adequate coverage.



Disclaimer:

The author of this article, thesmallbizpro, and affiliated entities are not certified insurance agents and claim no expertise or authority in the insurance industry.  Readers of this article are strongly encouraged to contact an appropriate insurance broker, agent, or appropriate entity to review individual circumstances.  This article is solely an opinion of the author who holds no liability for insurance options chosen by an individual, individuals, or organizations.

* Insurance definitions copied from the glossary at http://www.irmi.com/online/default.aspx 

Increase Traffic to your Web Site or Blog

Last night, I was fortunate enough to attend Jeff Williams' seminar on "Starting a Business After 50."  As a small business owner and coach for 25 years or so, he is considered a guru in marketing, sales, and general business knowledge.  Those interested in his program can find more information at http://www.bizstarters.com. 

Jeff had many words of advice for the audience, including suggestions on how to increase visitors to a web site or blog.  Allowing for paraphrasing, here are some of his suggestions:

1) Maintain fresh content.  Write an article, blog, post or something as often as possible.  Search engines rank sites partially based on new content and visitors will return for the latest information.  Site traffic is also measured by the number of page views you have received on your articles. 

2) Register and write articles for a site like www.ehow.com and populate your profile with links to your site.

3) Cross link with area companies that are not competitors.  An example might involve a craft business specializing in silver jewelry linking from a crochet or knitting craft site.  You link to them, they link to you, both sides win by gaining exposure and traffic.

4) Publicity.  As mentioned in a previous post, a press release can be a great way to increase traffic.  Using an Internet press release agency, such as www.prweb.com, can expose your site to millions of potential customers around the world.

Thanks to Jeff for these great ideas and get writing!


- AJ

Free blog hosts for starters

It is increasingly easy to post a blog online for free.  Several sites provide this service and bloggers can often earn money via advertising and referrals just by posting an opinion or idea.

Here are a few common and popular web links to FREE blog sites:

www.wordpress.com

www.blogger.com

www.blog.com

www.mashable.com

Some of these sites have restrictions on content - no porn or defamation - but open to any other blogs.

These services are a wonderful way to get noticed in cyber space and state a personal opinion.  If one has expertise in a certain area, blogging is a way of passing along that knowledge.  If one wishes to drive viewership, post often and with relevant content.

Words of caution though: Any thoughts you place on the Internet can be searched by employers or authorities and potentially be used against you.  Anonymity is at risk so be smart and careful when blogging.  Also, blogs are not the best way to sell a product if that is a goal.  A better and more controlled way is via a web site and virtual storefront.

Happy blogging!

- AJ

News Releases

A big issue facing all small businesses, especially new ones, is marketing or 'getting the word on the street'.  How can others learn about my product and/or service?  Tweets, Facebook posts, emails and posting notices may help, but generally will not provide adequate exposure.  This is a major problem if my business is a locally based dry cleaner or pet grooming service. Not many people willingly send laundry or Rover across the state.

How about this idea - a press release?  The media is still the most significant and powerful form of marketing yet invented and provides instant credibility and exposure.  How often have we heard "I read it in..." or "I heard it on..." so it must be true?  This concept, known as 'social proof', prods people to browse or purchase. A story in a local newspaper or trade publication is often a golden ticket. 

Press releases are used on the Internet too, potentially creating traffic from search engines such as Google or Yahoo and exposing a business to a larger audience.  This is a major advantage when a target market is geographically large or the business sells via the web.


Tips for writing a winning press release:


- Consider the 'newsworthy' nature of the release.  Why would a journalist write your story?  A journalist writes to sell copy - the article - not your product or service.  Give them something unique and they'll gladly write about it. FOR FREE!  Both sides win; the writer sells more copy and you gain clients.

- What is unique or distinctive about your product or service?  Have you recently opened a theme restaurant or patented the Chia Chinchilla?  Do you have a new product or service for your target area?  This product or service may have succeeded elsewhere but is fresh and original where you are.

- Write in an inverted pyramid style.  This is different than fictional writing in which a story builds.  In a press release, put the important points first - who, what, where, when, how, why - and leave the details for the second half.  Readers like to skim and the first lines must catch their attention.

- Be short and to the point.  300 to 500 words, no more.  Be concise, simple, and relevant.

- The title of your release less than 10 words.  More is an article and boring.  Make it catchy.

- Include contact information.  Address, phone number, web site (URL), or email.  Ensure the person that responds to inquiries knows the product or service.  Don't turn off new clients with incorrect information. 

Any other suggestions?  Please add them to the comment area.  Thanks!


- AJ

Jeff Williams - Presentation on Starting a Business 10-28

I just received notice that Jeff Williams, a veteran and well-respected business start up guru, is giving a free workshop/presentation in the Chicago suburbs on Wednesday, October 28th.  Details below.

Jeff is an outstanding speaker and has been coaching would-be entrepreneurs for 25 years.  He is well worth the time invested.

Starting Your Own Business    
Wednesday October 28, 2009
7:00 pm - 9:00 pm
Location: St. James     School Basement
Street: 820 N. Arlington Heights Road
City State Zip: Arlington Heights, IL 60004                                  
Phone: pcasey@arlingtonresources.com

Notes:
Speaker:  Jeff Williams, BizStarters  
Old School Basement:  Enter Door A5 of the building located on the east side of Arlington Heights Road 

Why the advertising and blog feeds?

Maintaining a web site, blog, Twitter, and Facebook accounts costs time and money. Since we are a free informational site, we'd like to make up some of the costs by using web site advertising. Google adsense is fairly easy to implement and seemed a logical path to recover at least a portion of the costs.

And about the blog feeds? Aren't you providing information from competitors?

In our view, information, opinion, and expertise is key. As we mention on our web site, the-small-biz-pro.com - we are not experts in any area. And, since we are not a business, per se, we can't have competition! Yes, we have experience and a level of training in certain areas, however this does not qualify us to provide a cookie-cutter approach to all. We firmly believe in our mantra: Shared Vision - Shared Resources - Shared Success.

Everyone benefits by contributions from those experienced in various areas such as accounting, marketing, legal, etc. We feel we'd be doing the small business community and especially our guests a disservice by not openly inviting others to contribute.

This is a blog conceived to benefit all who visit. If another blogger has a differing or better idea, great. Feel free to slice and dice our take on life, the universe, and everything.

Best wishes and good karma to all!

- A.J.

We made the switch

We've been debating whether to stay with GoDaddy's free blogcast (comes with the web hosting package) or move to another. The fact that you are now looking at Google's blogger ought to clue you in on the final decision.

Our reasons were simple: ease of administration, available features, opportunity for increased visitation, and subsequent revenue. All these taken into consideration, the move was a no-brainer.

GoDaddy is a fine product and certainly the paid version is likely better than the free, but for our purposes - and also as a consideration for our guests - the move to this provider is a major improvement. It's also free and can host advertising, etc. A future post will address that issue.

When choosing your hosting provider - web, blog or otherwise - you may need to try several before you settle on a winner. We may move again in the future as we grow, to be determined. In any case, keep this in mind:

- Don't commit to a long-term contract when starting
- How easy is the site to administer?
- Does it have desired features including links to Twitter, Facebook, and other social sites?
- How much does it cost?
- Can or will it host advertising, a potential source of revenue?
- What about pictures, videos, blogcasts, etc?

If your blog and/or web site is key to your business, be sure that the host has the features you NEED at the right PRICE.

- A.J.

Poll: Preferred Accounting Software

We are curious - which is your preferred accounting software?

In search of ...

At the-small-biz-pro, we started with an idea of transparency for everything we do and why we do it. This journey and each step has been related to you at our web site - http://www.the-small-biz-pro.com/-.html - in the 'Our Story' section. We believe that sharing and collaborating is the best path to success and will continue this idea.

Next up, we've decided that we need a logo that puts our brand into visual form. The question is how to develop one? None of the 4 of us are astute at graphic arts or visual presentation - we are business people, techies, and customer service folks.

We can do a logo of stick figures or modify an existing one - but that isn't the same, is it?

Yes, we know many marketing folks, and many others exist online that can be contacted, but we don't wish to spend big $$ on developing this. We also think knowing a resource that can develop a logo using our tag line - Shared Vision. Shared Resources. Shared Success - is a valuable commodity for the business community.

We have a few artistically talented friends & associates we're going to ask first; if they can put a visual form to our ideas, we'll be happy to put a plug in for them and share contact information with you.

More on this process as it develops...

- A.J.

Unusual jobs to earn extra money

For those seeking jobs that are a little non-traditional and unusual, but needed in many areas, here are some suggestions for you. These positions often pay in cash and can help to supplement unemployment income. Warning to all: Not reporting income from work on your taxes is not recommended by the the-small-biz-pro and runs the risk of IRS audits.

Here is a list of possibilites - please feel free to add more!

- Dog Walker
- Elder care, helper or babysitter (note: any positions involving specific medical care typically requires state licensing).
- Baby sitter - even adults can do this and are often more desirable. Be prepared with references.
- Day care - same as above and states tend to have limits on the number of children under care at any one time without a business license.
- Errand runner - do those errands that others just don't have time for
- Handyman - can you use a hammer and screwdriver? Know some basics of home repair? Any advanced projects may require specialized training and insurance. Again, be prepared with references.
- Pizza delivery - have a car? This job is local and always in demand.
- Store shelf stocker - many large companies (e.g. Kraft) use independents to stock certain target market stores.
- Storage unit buyer - self-storage companies regularly have auctions of storage lockers in default. You end up buying all contents of a locker, site unseen, and can end up with junk or a bonanza of value. Many of these items can be taken to consignment stores or sold on E-Bay.

As always, with any of the above, insurance and regulations may apply state to state. Do your homework!


A.J.

Social Networking for Small Business

Are social networking outlets valuable for more than just social contact? A recent article - http://news.bbc.co.uk/2/hi/business/8273667.stm - on BBC's web site thinks so.

According to the author, Claire Prentice, Facebook and Twitter have become a 'virtual marketing lifeline' for small businesses struggling during this recessionary period.

Smaller companies often have limited funds for elaborate marketing campaigns and depend on word-of-mouth for promoting their products and growing their customer base. In support, Prentice cites specific customers that are using Twitter and Facebook as a "virtual focus group, a bulletin board, a marketing campaign, and a branding exercise rolled into one."

Some businesses use social networks for more than just marketing. Appointment filling, surveys, promotions, and discounts are mentioned as additional advantages. Keeping in touch with customers, ability to react and offer rapid changes, and an additional 'personal touch' are considered valuable additions to customer service.

The author also points out dangers inherent in social networking. The potential for loss of control over an advertising message by opening a dialogue with customers is a significant concern. Some information systems experts suggest limiting social networking use to conversation and avoiding advertising. Another concern is saturation. The fine line between useful information and an overload of electronic hype is often blurred and easily crossed.

Social sites have arrived and are used frequently, if not continuously, and provide a wonderful opportunity to promote a brand or to gain a loyal following. These bonuses may be ultimately offset by a lack of content control and anonymity. Caveat emptor.

- A.J.

50 Best Cities to Launch a Business

I read an interesting article today about the best cities to launch a small business. Jointly researched by Fortune Small Business and the Kauffman Foundation, factors including growing economies, stable housing markets, low crime, and inexpensive labor were considered.

The top 10 cities listed were: Oklahoma City, Pittsburgh, Raleigh, Houston, Hartford, CT, Washington DC, Charlotte, Austin, New York City, and Baltimore.

Glancing over the imbedded map on this web site - http://money.cnn.com/smallbusiness/best_places_launch/2009/index.html - one can immediately see a bias toward the central south and north eastern areas of the country. Notable exclusions from the list included the west coast states (CA, WA, OR, NV) and population growth states such as Arizona and Florida.

The 'rust best' states fared poorly as well with no cities mentioned in Indiana, Michigan, or Ohio. Illinois had only Peoria and Wisconsin landed only Madison in the top 50. Colorado, Georgia and Idaho had no cities in the top 50.

Small business launches tend to be cyclical along with housing costs, population growth and crime rates. If one is considering jumping into the small business arena, research is key to understanding where a target market exists and is trending upward.

Food for thought...

A.J.

Sites on Branding, Marketing & Technology

We are constantly blasted with emails, instant messages, blogs, tweets, etc. promising quick money using various (and often questionable) schemes. I decided to do a little research and ran across the following articles that look a little more helpful and promising:

The first is an intelligent and well-received blog by Chris Brogan about 'Community and Social Media'. I suggest this is a good primer for those interested in the social networking phenom and what it entails. "What Human Business And the Social Web Are About" - http://shar.es/1xvR5

Another solid blog in a similar vein is Seth Godin's blog covering marketing, branding, networking and technology. His sage advice is well worth reading here: http://sethgodin.typepad.com/seths_blog/

A third site that fully covers small business issues is from S.C.O.R.E.org - a not-for-profit group that assists would-be entrepreneurs with advice and basic templates. The main site is located at: http://www.score.org/index.html and well worth checking out.

While none of these are get-rich quick sites with formulas for instant success, they each provide sound fundamental advice that will help in the shorter term and longer term.

- A.J.

Money maker for those with time and skills

With the real estate meltdown of the past 18 months, hundreds of thousands of properties have been foreclosed or are in the process. This situation, while horrible for many, presents opportunity for others. Some homes - I've seen quite a few in the western suburbs of Chicago - have been abandoned and are in need of repair. These homes can be purchased either for a primary residence or as a rental property. If a rental property is desired, take a close look at what the 'market will bear' for rent rates and ensure adequate savings to cover the unexpected costs. A formal written lease is key here too with a listing of what is and is not permissible use of the property.

Many financial institutions are sitting on properties they want to eliminate from their books. Banks are not interested in owing, paying real estate taxes or dealing with the problems associated with home ownership. This pushes banks to make 'deals' in order to eliminate their headaches. Properties can be purchased for considerably less than market value at this time. The secret here is to do your homework. Work with a real estate agent that specializes in foreclosed or near foreclosure properties. Look into property auctions by counties, banks or government entities.

This money-making model is longer-term one and provides no guarantee of definite or predictable returns. This is another reason why research is so important: Research the community, the historical price trends, demographic changes in the area, the school systems and of course, if possible, the property itself. If you find a potential candidate, but can't view the property, ask neighbors about the previous owners and what they may know about the condition.

Remember that banks have tightened the lending process and a potential buyer will need to have a fairly clean credit record and probably a down payment to qualify for a loan on a rental property. Check with local banks, credit unions, and the Internet for current rates and conditions. A good site for this is www.bankrate.com.

A final note: It also helps to be handy with tools and be ready to put in plenty of 'sweat equity' time!

- A.J.

Hobby or a business? An IRS view.

Yesterday I wrote about several possible small business opportunities, many easily done and with little to no startup cost. One of these involved turning a hobby into a money-maker. Naturally, of course, there are potential tax implications from such a move. If one intends to mix business and pleasure, be aware of the IRS rules and regulations. The following are taken directly from the IRS small business site:

"In order to make this determination (hobby vs business), taxpayers should consider the following factors:

• Does the time and effort put into the activity indicate an intention to make a profit?
• Does the taxpayer depend on income from the activity?
• If there are losses, are they due to circumstances beyond the taxpayer’s control or did they occur in the start-up phase of the business?
• Has the taxpayer changed methods of operation to improve profitability?
• Does the taxpayer or his/her advisors have the knowledge needed to carry on the activity as a successful business?
• Has the taxpayer made a profit in similar activities in the past?
• Does the activity make a profit in some years?
• Can the taxpayer expect to make a profit in the future from the appreciation of assets used in the activity?

The IRS presumes that an activity is carried on for profit if it makes a profit during at least three of the last five tax years,including the current year — at least two of the last seven years for activities that consist primarily of breeding, showing, training or racing horses."

The entire IRS opinion is here: www.irs.gov/newsroom/article/0,,id=169490,00.html

Remember, always do your homework and don't cause trouble with the powers-that-be!

- AJ

Simple ideas for additional part-time income

Most of us would like to make more money - especially in these days and times. Or maybe we need to supplement a reduced family income or we're retired and want to do something interesting and profitable. Below is a list of relatively simple ideas for part-time income. Feel free to comment and add your own suggestions or success stories!

• Home demonstrations/parties

1. Lia Sophia
2. Tastefully Simple
3. Pampered Chef
4. Tupperware
5. Avon
6. Adult novelties
7. Cash for gold
8. Usbourne Books

• Free-lance writing

1. Magazines
2. Newspapers
3. Internet blogs

• Crafts - perhaps you make a hobby of knitting, crochet, or needlepoint. Create interesting and inexpensive items that can be sold either via local craft shows or via a web site.

• Residential and/or small business computer installation and repair. Provide rates at lower than the big players and market yourself to local communities. This idea may require business insurance to cover any losses or coincidental problems caused.

• E-Bay selling. Do you have a collection of 'stuff' you want to get rid of? Or perhaps know others that want to sell their 'stuff'? Offer to take the pictures, put listings on E-Bay (either for a percentage of the selling price or a flat fee) and ship the products.

• Teach a class in your field of expertise at a community college or for a local ongoing education (often offered by municipalities) program.

The point here is opportunity exists - even in difficult economic times - to find some kind of part-time work and make a little extra. Or, maybe get your retired husband/wife/significant other out of the house!

Luck!

- AJ

A Job Transition Journey

I was a Business Analyst my entire career until being laid off in January 2009. I had an interest in this career but did not have a passion. As I began a job search, I was encouraged to identify skills that would enable me to have a second career or be an entrepreneur. When originally thinking of these skills, I thought only of my long time Business Analyst skills and possibly marketing these skills as a consultant. I began a usual job search to continue my Business Analyst career with no responses after months of online application submissions. I also attended networking meetings, workshops, programs and seminars offered by the Arlington Heights Library, St Hubert’s Unemployed Ministry, Harper college, and IDES. Through these activities I began to expand my skill identification beyond traditional business skills to my passions. I have always been a life long volunteer as a Christian care/support giver, learner, and led an active/fit lifestyle. Could pursuing these passions empower me to reinvent myself and transition to a second career?

The question was answered with the assistance of a Harper College Career Stimulus program Career coach. During our meetings we identified these possible passion careers; college adjunct teacher, in home care companion (non medical), and personal trainer. We also defined a job search for each of these careers. I have been active in each search and through networking landed a part time job as an in home care companion. Because I have a passion for the job I now go to work excited and leave fulfilled. Also I am now considering blending two part time jobs I am passionate about in lieu of full time employment.

BMac

Can I Fire Myself?

If I am my own boss, can I still get fired?


One of the reasons a person may decide to go into business for themselves is to be independent of a structure imposed by a manager, boss, corporate policies, etc. The autonomy that is gained comes with challenges and more importantly,a high degree of risk. The first question to be addressed is “Do I have a product (goods or services) that a customer would spend money on?” A customer will spend money to solve a problem. What solution do I have to a problem and what value does it have? What is my product? Am I capable of taking on the responsibility of a business that delivers my product to customers?


There are a number of additional questions that must be answered:

• Why do I want to be my own boss

• As an entrepreneur, am I capable of functioning outside the structure of an existing business?

• Do I have the organizational skills to manage a business,or do I have the financial position to pay someone else to take on these responsibilities?

• Will anyone else value the product that I want to bring to the market? (This can also include a service.)

• If this activity is something I enjoy doing, will I still want to do it enough to clear a profit?

• Do I have the financial resources to support a fledgling business long enough to become established?
  

• Do I have the support system in place (family and friends) to meet the physical demands of time, energy and motivation that are necessary when starting and running a business?

• Do I want to start a business that is my own creation, or should I look at a structured business such as a franchise where the format and business structure is already predetermined and there is a support system that I can turn to for assistance?

• Will I be able to take an objective look at my business and business process and make the necessary changes that will lead to a successful business and a profit?

• What is the market for my product and how will I connect with my market?

• Can I generate repeat business from my customers and establish additional revenue flows?

• Can my product (or service) be duplicated by more employees so my business can grow?

• If “I am” the business, what is the maximum capacity of my business?
  

• Is that enough to generate the desired revenue (profit) to be my only source of income?

• Do I do this part time in addition to my previous job or does the new business become my only job?

• Am I prepared to expand my business and meet the expanding demands of a bigger business model, or do I stay small?

• Is my product something that will become obsolete (such as Beanie Babies) or can I adapt to a changing market?

• Will my customers reject my product at a later date or find there is no longer a need for my goods or services?

• Am I capable of accepting the role my customers play in determining the validity and value of my product?

• If my product is no longer relevant or marketable, will I know when to close the business? Do I have an exit strategy for my business?
  

• If my business is rejected by my customers do I look fora new market, a new product or additional lines to increase my revenue flow?

• If I close my business, will I be prepared to develop a different business or do I return to the role of employee in another business?

• If I am “fired” by my customers, will I know it and how will I react to that change?

These are just a few of the questions that must be addressed before considering becoming your own boss and going into business for yourself. Once the decision to start a business is made, the actual “mechanics”of the business such as a business plan, the structure of the business,financial plan, etc is the next phase of the planning your start up. There are many resources to turn to for the mechanics of a business. Only you can assess your capacity as an entrepreneur in building and sustaining a business. If you don’t try, you may never know the depth of your skills and capacity as an entrepreneur.



- Molly B.

Welcome to TheSmallBizPro Blog!

This blog is a continuation of the ongoing saga of the-small-biz-pro.com web site.

We, the founders, welcome you and your thoughts/comments/ideas and concerns. These pages are designed with you in mind and we will strive to create as rich an experience as possible.

Our home web site is the-small-biz-pro.com . Our content will be updated frequently - join the community in helping others through the business start up and operations process.

Molly, Caspar, BMac, and AJ