12/1/2012 - Balance sheet analysis leads to better business decisions
A well-prepared balance sheet contains a wealth of information. Assuming the asset, liability, and equity amounts are supported by accurate data, the relationship between the numbers — especially when compared with prior balance sheets — may provide valuable insight into your company's financial health. That information, in turn, may guide you toward the best operational decisions.
11/1/2012 - Overworked employees aren't good for business
In today's highly competitive marketplace, many workers are glad to be gainfully employed and may be willing to work extra hours just to keep their jobs. But numerous studies have shown that pushing employees too hard — requiring them to work overtime hours for months on end, for example — can lead to significant risks for both the employee and the company. The problems can be the same even if an employee volunteers for overtime.
10/1/2012 - Examine the pros and cons of hiring your children
Hiring your own children — whether employed part-time emptying wastebaskets or full-time managing your operations — is often a great idea. As an employee of your business, a school age youngster can develop a strong work ethic and money management skills. His summer income may be used to pay for school clothes, music lessons, or sports camps. Hiring an adult child may be less risky than bringing a stranger onboard. After all, you probably won't need to scour a five-page job application to know your kid's capabilities and commitment level.
9/1/2012 - Should you lease or buy office equipment?
If your company needs office equipment — computers, copiers, or telephone systems, for example — you as the owner may question whether it's smarter to lease or to buy. It's not always an easy choice. Each firm faces a unique set of market conditions, financing options, tax considerations, and other factors. Yet there are certain pros and cons that a prudent business owner should consider.
8/1/2012 - It's smart business to create clean audit trails
Whether or not your company is ever audited, maintaining a clean audit trail makes good business sense. A clear and supportable record of your firm's routine and not-so-routine transactions can be used to manage operations, detect fraud, ensure compliance with government regulations, even speed up the audit process itself.
7/1/2012 - Establish sensible credit and collection policies
Providing quality goods and services requires a significant investment of time, cash, and expertise, and without an effective credit and collection policy, a reasonable return on that investment may prove elusive. By extending credit to customers who don't pay, companies all too often provide products and services for free. Yet if businesses tighten credit requirements too much, good customers may take their business elsewhere. Although owners and managers may be reluctant to pump scarce resources into collecting bad debts, if receivables aren't adequately controlled, a company may find itself without the cash needed to cover ongoing expenses.
6/1/2012 - Basic market research can be a valuable business tool
Whether you're developing a business from scratch or expanding your existing product line, it's vital to understand your market — your target customers, your competition, and the environment in which your company operates. A little basic market research can help you avoid costly mistakes, such as loading your warehouse with unmarketable products or spending your advertising budget on wrongly directed campaigns. Conversely, digging into the details of your market may uncover exciting new opportunities.
5/1/2012 - What to consider in choosing a successor for your business
Studies show that only 30% of family businesses survive the transition from the founder's generation to the next generation. Of the companies that weather such transitions, less than half successfully transfer the business to a third generation. Such statistics demonstrate the importance of succession planning, a task that can be especially difficult for small businesses. Ownership and management of such firms are often vested in the same person or small family group, so identifying and grooming those who will lead the company forward is critical and fraught with risk.
4/1/2012 - How important is location to business success?
For years, real estate developers have recited the mantra of "location, location, location," and start-up businesses do well to take heed. Location is often the single most important determinant of a company's success or failure. Place your brick-and-mortar building in a prime locale and, other things being equal, the firm will have a greater chance of accomplishing its objectives. Set it down in the wrong place, and the business may struggle for years.
3/1/2012 - How to deal with obsolete inventory
Walk through most commercial warehouses and you'll find products that have been collecting dust for months, even years. Tires that no one wants to buy, raw materials that are no longer used, tubes of caulking that are good for nothing but the dumpster, textbooks that college professors revised two years ago — all may be considered obsolete inventory.
2/1/2012 - How to be "audit ready"
No one likes to see a policeman's flashing lights in the rearview mirror, and no one likes to receive a phone call or letter from the dreaded auditor. But if you operate a business or your organization receives federal or state grants, at some point you may find auditors making that contact. And while it's true that only a small percentage of individual taxpayers suffer through an IRS audit in any given year, it makes sense to be prepared—just in case. One key to being ready is knowing how auditors think.
1/1/2012 - Keys to getting a small business loan
Before a start-up company can begin producing revenue, it often needs an infusion of cash that exceeds owner contributions. Even long-established firms sometimes must borrow to purchase inventory, buy real estate, expand operations, meet payroll, or keep the lights on. When business owners turn to banks and other financial institutions for help, some are offered loans; others walk away empty handed.
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