CORPorLLC.com Newsletters

The Leap of Faith

2008-08-22T15:47:00.000-07:00

This is a good time in your life for you to take more aggressive action -- and take a few more risks here and there. So what if a plan or two backfires on you? It's time for you to get comfortable with the idea that you can't hit a home run every time you step up to the plate. Sometimes you just get to first base -- and sometimes you strike out.

But guess what? No one is going to throw you off the team any time soon. You'll always have more chances."Now that you understand the "Risks & Rewards" of entrepreneurship, it's time for you to place faith in yourself and your product/service. Since reading our preceding lessons, I hope that you have learned to build a solid foundation. If not, go back to the first and read through to the last.

The first thing you need to do is decide what type of entity best suits your business: sole proprietorship; partnership; corporation; limited liability company (LLC), etc. By choosing the appropriate type of entity, you will be able to save yourself thousands in taxes and headache. Although many businesses start as sole proprietorships, I am not a fan of them. To explain, everything relies solely on the owner. The owner's credit, credibility, liability and personal artifacts are all on the table in this gambling game of entrepreneurship.

I often hear clients bark about how good their personal credit score is, how small of a business they are, etc. I usually challenge them by saying, "Can your personal life (credit, credibility, liability and assets) survive ONE unfortunate situation? Being sued? Business slows down? If not, establishing your business as a corporation or LLC is the best solution. By forming your business into a legal entity, you protect yourself and your business. Build business credit in your business' name. That way, if God forbids something goes awry, your personal credit and assets will remain intact. Also, it builds credibility that you are not a "fly by night" company, while offering you hundreds of more tax deduction opportunities.

It's time to get moving, there is no better time than the present! Don't look back five years from now disheartened that you never followed your dream. Take the bull by the horns and begin! With job security being at its weakest levels since the Great Depression, business ownership is your team that no one can kick you off of!!!

The Labyrinth of Business Choices

2008-05-29T07:20:00.000-07:00

"Life is funny." Ha, if you think life is funny you should try business ownership. Sometimes it seems as if every decision you make to better your business ends up at a dead end. At times, you can see the wall ahead and others, you take a long winding journey before you face another wall. I must admit, the choices that lead to the U-Turns of entrepreneurship stem from a few things:

1. Research - there was not an effective amount of research done prior to making the decision that was made.
2. Arrogance - thinking you do not need any help, that you built this on your own and you can run it on your own.
3. Selfishness - either not hiring someone to do a job that yes you CAN do, but it takes you so long to do it because you have to learn the effective way to do it
4. Mismanagement - putting all of your eggs in the wrong basket. Yes, you have $1000 for marketing your landscape business; so you decide to get a HOT website built... um, you cut grass.
5. Faithless - everyone else believes that you will succeed, but you question yourself.
6. Instant Gratification - because things are not happening as fast as you want it to, you think that you made a wrong choice in business ownership and make irrational choices.

If you haven't read or watched 'The Secret" I implore you to do so. A lot of people complained that it took God out of the formula, but I disagree. It all comes back to "Cogito, ergo sum" Latin for "I think, therefore I am." If you have faith (from a Biblical perspective or not), you know that you will reach your reward even if you don't know how. This is the best approach in business ownership. You know your product or service (if not, that is the first error); your prices/fees are competitive; and you know your marketing demographic. Once you align these particular items, everything else will come together.

"With great achievement comes greater sacrifice." (That is a COLE-oquialism) There are going to be road blocks in business, some greater than others. Stay determined and persevere by making the adjustments that each situation requires and keep moving forward. Once you focus on your reward and place your ducks in a row, it will be easier for you to find your way through the labyrinth of business and you will find your 'cheese' (metaphorically and literally speaking).

2007-12-20T10:29:00.000-08:00

Decisions: Risks & Rewards (Part 1 of 2) [Issue III]

2007-12-19T09:49:00.000-08:00

Decisions… decisions… decisions! Can I please have a time machine to explore the outcome of my options BEFORE I make the decision? How nice would that be? To know the outcome of choices before you make them. There was a movie released in early 2007 called “Next” starring Nicholas Cage. The title, “Next” referred to what happens NEXT! Nicholas Cage’s character had the gift to look into the future 2 minutes ahead. The movie amazed me, he could make decisions based on there outcomes because of this gift. Imagine that!

Unfortunately, that is Hollywood and this is Life. In life, we have the same decisions without the futuristic knowledge. These decisions can impact our future positively or negatively. They can leave you with happiness or strife, wealth or poverty, being successful or unsuccessful. Therefore, when entering into business you must base your “decision” on the Risks and Rewards.

First, you must thoroughly explore your goals and motivations. Ask yourself these important questions:

· What do I want to do?

· What do I do well?

· What do I enjoy doing?

· What makes me happy?

· What satisfies me professionally?

Research studies have shown that the most successful entrepreneurial ventures are those that are closely linked to the owner’s interests, goals, motivators, and competencies. For instance, statistics show that it would be more advantageous for a person that has volunteered at a humane society for years to open a pet store compared to a retiring auto mechanic to open up an alteration shop. Reason being, the experience can offer a high learning curve to the industry and its competitors which can result in a huge advantage to your success.

The second, of equal importance, is to research more than one business in order to better understand the advantages and disadvantage of each, processes and procedures specific to each particular business or industry, potential obstacles, competitive factors, market indicators, and much more. Ask other business owners about their successes and failures. It may provide you with the push into a particular business or industry than what you thought prior.

You should take the time to evaluate business opportunities in the same facet that you would explore job offers. Do your research, develop your network of contacts, and conduct informational interviews to learn about your business or industry of choice. You’ll be surprised to learn that most business people, even those that are potential competitors, will share their business experiences with you.

Decisions: Risks & Rewards (Part 2 of 2) [Issue IV]

2007-12-19T09:42:00.000-08:00

“Thousands succeeded, but millions failed!” More often than not, people simply get an idea, think they will be great, and learn later that it was not right for them nor did they have realistic expectations about all that was involved. This is the reason why so many businesses have failed year in and year out. Don’t be high on motivation but low on knowledge and skill, thinking big is no substitution for the work involved. Starting and running a business IS hard work and nothing is going to change that.

Don’t go to work yelling, “I Quit!” This decision is often irrational. I recommend a book entitled, “Rich Dad’s Before You Quit Your Job” by Robert Kiyosaki before you make that leap of faith. Every successful entrepreneur knows that starting a new business means taking risks – financial, personal and professional. Remember, you don’t have the gift that Nicholas Cage’s character had in the 2007 release of the movie, “Next.” Therefore, you must ask yourself if you and your family can withstand the risks of entrepreneurship. Ask question like:

· Can I live with an unstable income for the first year, two, or more of my business?

· Do I have enough money saved to sustain my personal like and my family while my business becomes established and starts to generate profits?

· Can I manage the stress and volatility associated with entre-preneurship?

· Will my family be supportive, even if things are difficult financially?

· Will my family understand that I will have very long workdays and an erratic work schedule?

· Am I willing to stake my professional reputation and career on my new venture?

If you can comfortably answer yes to these questions then you are ready to embark upon entrepreneurship. If not, you may want to reconsider timing, structure and sensibility of taking on entrepreneurship. It is evident that risks exist, if not prepared for them they can take a toll on the emotions, personal life, professional life, even actual livelihood of you and your loved ones.

Let’s take a look at the national statistics:

· There are over 20 million small businesses in the U.S.

· Small business owners disproportionately earn more than $100,000 a year.

· Approximately one in 14 workers attempt to start a business each year.

· Nearly 700,000 businesses are started each year.

There is also a downside to those “growth” numbers:

· 540,000 businesses close each year.

· 50% of new businesses fail within the first three years.

Now the ball is in your court. You have a decision to make, just realize that you don’t have the “gift” to look in the future. Keep in mind both the Risks & Rewards of entrepreneurship before taking the leap. Now, don’t be discouraged by the statistics when it comes to starting a business. Researching these same statistics prove that the numbers are not accurate; we have customers that incorporate their businesses and never do anything with them. Those are taken into accountability as “failed” business.

The point I am trying to make is obvious. Learn from others mistakes! What’s most important are your attitudes, motivators, and skills for entrepreneurial success. You’re your decision to pursue entrepreneurship should be based on YOU! Be honest with yourself, know your limitations as well as your capabilities.

Insanity [Issue II]

2007-12-19T09:39:00.000-08:00

“Insanity: doing the same thing expecting different results.” – Author unknown

Is that the TRUE definition of insanity? I know I have been told countless times that is the definition of insanity. Well, although it makes since, that is not the definition. Insanity is defined as: unsoundness of mind or lack of the ability to understand that prevents one from having the mental capacity required by law to enter into a particular relationship, status, or transaction or that releases one from criminal or civil responsibility: as a : a disease, defect, or condition of the mind that renders one unable to understand the nature of a criminal act or the fact that it is wrong or to conform one's conduct to the requirements of the law being violated b : inability to understand and participate in legal proceedings brought against one.

It amazes me how much we tend to “believe” what we are told without researching the truth, especially in starting businesses. We gather enough information from limited resources and go out thinking we are specialized in particular areas. We do this without establishing a foundation.

When my business partner and I first established our business, we were walking sponges. Yes, our competitors were offering products and services that we could have easily offered as well. Yet, we decided to take on our business one service at a time. We read books and Google^® searched ourselves to oblivion. We wanted to know all we could learn about each facet of our business one step at a time.

It amazes me, even until today, how much that helped with our credibility. With so many major competitors, small businesses have to “prove” themselves to consumers. This is even more difficult intangible products/services. Reason being, consumers don’t “walk away” with what they paid for immediately. They have to have faith in your organization to be willing to extend their comfort zones to give you that chance.

Researching your industry, competitors and consumer interest are vital to the longevity of your business. It assists with marketing trends and reducing overhead.

I challenge you to take some time and invest it into your business. Yes your days may be as much as 16 hours of “making ends meet”, but the outcome of putting time along with energy and money in your business proves to make it more successful. Follow the 3 R’s of business: Research, Read and Request. Research, take time to utilize the internet; the internet can reduce your research time astronomically. Read, there are many of books out there about your industry or just information about running a successful business; take some money out of the business to invest in having these tools at your fingertips. Request, help is there for the asking; there are countless organizations that assist small businesses without fees (i.e. SCORE-Service Corps of Retired Executives and the SBA-Small Business Administration).

Open yourself to an abundance of success by just taking the time to invest TIME into your business.

When I Grow Up? [Issue I]

2007-12-19T09:34:00.000-08:00

Ah, sweet memories… I remember being in Ms. Virginia Hoffman’s 2^nd grade class being asked what I would like to be when I grew up. Questioning begun with Sauna Mars, my first girlfriend that only lasted 2 days. I want to be a nurse Ms. Hoffman. As the answers snaked around the room, my mind raced for an answer. I mean come on, I was only 7 and being Batman was a realistic option. After repeated Doctors, Lawyers, Firemen, Policemen, Soldiers and much more; I, with the confidence of Napoleon and other great leaders decided… I want to be President!

I’ve looked back at that day repeatedly and realized I never wanted to be President. Going through college, I noticed no one ever said I want to run my own business. With the inception of small businesses on a constant climb, how come? What is funny is that at 7 is when most of us start our own first business. Even then, after school I would offer to rake leaves for the neighbors at a rate of $2; this was enough for me to go to McDonalds and have a field day.

I had to manage my time to accommodate school work, house chores and my “extra” work. What was truly amazing was I had to organize my day to be back in the house before the street lights glared. This was a difficult task growing up in the suburbs of Chicago, because the lights were powering up by 5:30 pm and school did not let out until 2:30 pm or so. Fortunately, my parents understood more so than I the importance of making it on my own; that they allowed me to do my schoolwork when I was summoned to return home by the street lights. Their understanding allotted me more time to do neighbors yard work and other menial tasks for “extra” money.

Now that I look back, I was a successful business owner at 7! Why did I not want to be a business owner the day when Ms. Hoffman asked me? Could it have been that I didn’t know what it was to be an entrepreneur? Maybe no one gave me the information to explore this as a possibility. Could it have been the fear that I thought that answer wasn’t acceptable?

Many of us adults look at our talents and hobbies as just that without the drive to make them successful businesses. We fear what others may think of us if we fail. We fear that the decision to start our own business could jeopardize our families. We fear giving up the security and stability of our 9 to 5 for the opportunity of having our own unsuccessfully. One thing I was taught in college, “Fear is a mind killer, it is that little evil that destroys us from inside out. I must learn to face and control it. Fear.”

I can admit that statistics show that failure is more likely than success. Statistics show that businesses open and close everyday like the doors on high school lockers. How many times have you been “stuck” in a dead end job? How many of you are in one right now?

I challenge you to do your research, plan an exit strategy from your current job and give business ownership a try. If not full-time, at least to develop a foundation that gives you the option to leave that dead-end job and explore a new wealth of possibilities as a successful business owner loving what you do. As they say… car $25,000; house $200,000; current job $50,000; working for yourself and enjoying what you do… Priceless!