Friday, June 16, 2006

Business Through Your Browser

How seven small businesses are using the Internet to increase profit and improve customer satisfaction-and how you can be a success story, too.

As the U2 song goes, "Sometimes you can't make it on your own." That's very true for many small and medium-size businesses (SMBs). By turning over IT tasks to online services, SMBs are saving time and money-and increasing customer satisfaction. In this story, we profile companies that use online services to do everything from providing telecom service to handling payroll. After you read their stories, turn past the gatefold for three pages of tips on how you can follow in their footsteps.

Enterprise Resource Planning (ERP)

ERP solutions are typically back-office systems and applications that automate business practices. For example, supply-chain management systems are designed to keep businesses connected to suppliers.

  • To put ERP systems into place, you can use an ERP software maker or a consulting company specializing in ERP. Oracle Applications, Oracle's PeopleSoft, SAP, Microsoft Dynamics, and The Sage Group are all good sources. You can also find many smaller ERP service providers, such as 24SevenOffice.
  • Many software providers offer prebuilt ERP solutions that you can buy and implement yourself. Some of these include Epicor Enterprise, Oracle's JD Edwards EnterpriseOne, andNetSuite's Net-ERP. There are also providers of open-source ERP software, such as GNU Enterprise.
  • Baseline (published by Ziff Davis Media, the parent of PC Magazine) offers resources for ERP solutions at Baseline's content is conveniently categorized so that you can find case studies and resources on, say, supply-chain management or security solutions.


Collaboration services can help facilitate work among teams within your company as well as with clients.

  • Some online meeting services, such as and LiveMeeting, include video conferencing, and many others, such as GoToMyMeeting, allow for quick and easy online meetings.
  • Collaboration also involves sharing files, databases, calendars, and contacts. Look for reputable companies that devote significant attention to security. PC Magazine's Editors' Choice for online collaboration is WebEx WebOffice, and we're keeping an eye on Microsoft Office Live beta.


Web-based database services are so easy to use, they double as collaboration tools. At PC Magazine, we use Intuit's QuickBase ( to track new products and organize stories. Think of an online database as a (very) beefed-up spreadsheet everyone has access to.

  • In addition to QuickBase, other low-cost hosted databases include eCriteria ( and Caspio (
  • Don't be afraid to customize. Almost anyone can open a Web browser and tweak a database to his or her liking, adding fields, moving fields, and changing field names.
  • Looking for something a bit more substantial? Traditional database companies like Oracle offer on-demand versions of their database products, letting you run massive full-fledged databases via Web browsers.

Technical Support

Online tech support services can assist you with everything from installing a Wi-Fi network to taking angry calls when your employees' PCs crash. SMBs often turn to the value-added resellers (VARs) that initially installed their IT equipment. Where should you look for your tech support solutions?


Managed VoIP isn't for everyone. While it puts the burden of maintenance on someone else's shoulders and can cut your hardware costs-along with the size of your IT department-it also gives you less control over your phone system. Adding a new user to the phone network, for example, requires you to contact your service provider-and hope they get around to it soon.

  • Find a vendor that has a large, responsive support team, and be sure to test a company before you sign a contract. At the very least, see how long it takes to respond to a service request.
  • Consider a private data link to your telecom service provider. It will cost you, but you can expect higher call quality in return. Voice traffic will be given a priority, and you won't be sharing bandwidth with every e-mail, Web page, or MP3 tune passing over the public Internet. Be sure to ask about redundancy, in case your T1 link ever goes down.
  • Make a lot of international calls? Be sure your service provider has agreements with multiple long-distance companies. That way, if one carrier doesn't work well, you can switch to another.

Security (antispam)

You don't have to give up all control when you start using an off-site service: You can relinquish control entirely or choose to retain the ability to tweak filters and browse quarantined messages via a Web browser.

  • Many companies, including MessageLabs and MX Logic, offer antispam and antivirus services. Even traditional antivirus vendors like Trend Micro offer off-site services. You can even let your employees browse quarantined messages. Companies like Postini can set up Web-based quarantine folders for each individual user.
  • There are two more advantages to using a service rather than an on-site app: You're never hit by directory harvest attacks (they hit the service instead), and you don't

Customer Relationship Management (CRM)

Nowadays the term CRM is a tad misleading-or at least, limiting. CRM can be used to manage business practices such as sales and inventory as well as the more traditional customer support, contact management, and project tracking.

  • is the biggest name in Web-based CRM, but it's not the only one. Check out rivals BScaler, Entellium, RightNow Technologies, Salesnet, and SMB Live.
  •'s basic tools aren't what you're looking for? The company now offers AppExchange, an online marketplace where businesses can build their own Web-based applications and share them with others.
  • If a company's CRM tools don't fit you to a T, try customizing them. You needn't be a hardcore programmer; all it takes is a general familiarity with the applications.


Online payroll services will process your payroll accurately and on time, but don't look to them for financial advice-in other words, don't fire your CPA!

  • Don't get too comfortable. Just because the process is automated doesn't mean you should keep your hands off it. Mistakes like missed or mislabeled payments do happen. Check your statements and quarterly reports.
  • Stick to a single online payroll provider. Accessing old records is simple if you use only one program, but the process can be tricky-if not impossible-if you've used multiple vendors over the years. Be sure to ask your vendor how-and for how long-you can retrieve records once you've canceled your account.
  • Call the customer support number before you sign on for the service and see how responsive and knowledgeable the staff members seem. If they can't answer your questions, they won't solve your problems.
  • Look for a Web-based interface. This will let you access and manage your payroll from any location at any time.

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Thursday, June 15, 2006

Do Your Potential Customers Forget About You?

Your web business probably gets product inquiries from potential customers around the globe. Inquiries come via e-mail and your web site, and you try to send information to each hot prospect as quickly as you can. You know that you can drastically increase the likelihood of making a sale by satisfying each person's need for information quickly! But, after you've delivered that first bit of information to your prospect, do you send him any further information?
If you are like most Internet marketers, you don't.
When you don't follow that initial message with additional information later on, you let a valuable prospect slip from your grasp! This is a potential customer who may have been very interested in your products, but who lost your contact information, or was too busy to make a purchase when your first message reached him. Often, a prospect will purposely put off making a purchase, to see if you find him important enough to follow up with later. When he doesn't receive a follow up message from you, he will take his business elsewhere.
Are you losing profits due to inconsistent and ineffective follow up?
Following up with leads is more than just a process - it's an art. In order to be effective, you need to design a follow up system, and stick to it, EVERY DAY! If you don't follow up with your prospects consistently, INDIVIDUALLY, and in a timely fashion, then you might as well forget the whole follow up process.
Consistent follow up gets results!
When I first started marketing and following up with prospects, I used a follow up method that I now call the "List Technique." I had a large database containing the names and e-mail addresses of people who had specifically requested information about my products and services. These prospects had already received my first letter by the time they requested more information, so I used the company's latest news as a follow up piece. I would write follow up newsletters every now and then, and send them, in one mass mailing, to everyone who had previously requested information from me. While this probably did help me win a few additional orders, it wasn't a very good follow up method. Why isn't the "List Technique" very effective?
The List Technique isn't consistent. Proponents of the List Technique tend to only send out follow up messages when their companies have "big news".
List Technique messages don't give the potential customer any additional information about the product or service in question. He can't make a more informed buying decision after receiving a newsletter! If someone is wondering whether your company sells the best knick-knacks, what does he care that you've just moved your headquarters?
List Technique messages convey a "big list" mentality to your potential customers. When I used to write follow up messages using the List Technique, I was writing news bulletins to everyone I knew! I should have been sending a personal message to each individual who wanted to know more about my products.
What follow up method really works? Following up with each lead individually, multiple times, but at set intervals, and with pre-written messages, will dramatically increase sales! Others who use this same technique confirm that they have all at least doubled the sales of various products! In order to set this system up, though, you need to do some planning.
First, you'll need to develop your follow up messages. If you've been marketing on the Internet for any length of time, then you should already have a first informative letter. Your second letter marks the beginning of the follow up process, and should go into more detail than the first letter. Fill this letter with details that you didn't have the space to add to the first letter. Stress the BENEFITS of your products or services!
Your next 2-3 follow up messages should be rather short. Include lists of the benefits and potential uses of your products and services. Write each letter so that your prospects can skim the contents, and still see the full force of your message.
The next couple of follow up messages should create a sense of urgency in your prospect's mind. Make a special offer, giving him a reason to order NOW instead of waiting any longer. After reading these follow up messages, your prospect should want to order immediately!
Phrase each of your final 1 or 2 follow up messages in the form of a question. Ask your prospect why he hasn't yet placed an order? Try to get him to actually respond. Ask if the price is to high, the product isn't the right color or doesn't have the right features, or if he is looking for something else entirely. (By this time, it's unlikely that this person will order from you. However, his feedback can help you modify your follow up letters or products, so that other prospects will order from you.)
The timing of your follow up letters is just as important as their content. You don't want one prospect to receive a follow up the day after he gets your initial informative letter, while another prospect waits weeks for a follow up!
Always send an initial, informative letter as soon as it is requested, and send the first follow up 24 hours afterwards. You want your hot prospects to have information quickly, so that they can make informed buying decisions!
Send the next 2-3 follow up messages between 1 and 3 days apart. Your prospect is still hot, and is probably still shopping around! Tell him about the benefits of your products and services, as opposed to your competitors'. You will make the sale!
Send the final follow up messages later on. You certainly don't want to annoy your prospect! Make sure that these last letters are at least 4 days apart.
Following up effectively seems complicated, but it doesn't have to be! So many potential customers are lost because of poor follow up - don't you want to be one of the few to get it right?

Small Business Survival Tips

No matter what kind of small business you have, you need read these "small business survival tips" which will help you to succeed.

You may be in Mail Order, Direct Mail, or you may be a local merchant with 150 employees; whichever, however or whatever---you've got to know how to keep your business alive during economic recessions. Anytime the cash flow in a business, large or small, starts to tighten up, the money management of that business has to be run as a "tight ship."

Some of the things you can and should do include protecting yourself from expenditures made on sudden impulse. We've all bought merchandise or services we really didn't need simply because we were in the mood, or perhaps in response to the flamboyancy of the advertising or the persuasiveness of the salesperson. Then we sort of "wake up" a couple of days later and find that we've committed hundreds of dollars of business funds for an item or service that's not essential to the success of our own business, when really pressing items had been waiting for those dollars.

If you are incorporated, you can eliminate these "impulse purchases" by including in your by-laws a clause that states: "All purchasing decisions over (a certain amount) are contingent upon approval by the board of directors." This will force you to consider any "impulse purchases" of considerable cost, and may even be a reminder in the case of smaller purchases.

If your business is a partnership, you can state, when faced with a buying decision, that all purchases are contingent upon the approval of a third party. In reality, the third party can be your partner, one of your department heads, or even one of your suppliers.

If your business is a sole proprietorship, you don't have much to worry about really, because as an individual you have three days to think about your purchase, and then to nullify that purchase if you think you don't really need it or can't afford it.

While you may think you cannot afford it, be sure that you don't "short-change" yourself on professional services. This would apply especially during a time of emergency. Anytime you commit yourself and move ahead without completely investigating all the angles, and preparing yourself for all the contingencies that may arise, you're skating on thin ice. Regardless of the costs involved, it always pays off in the long run to seek out the advice of experienced professionals before embarking on a plan that could ruin you.

As an example, an experienced business consultant can fill you in on the 1244 stock advantages. Getting eligibility for the 1244 stock category is a very simple process, but one with tremendous benefits to your business.

The 1244 stock encourages investors to put equity capital into your business because in the event of a loss, amounts up to the entire sum of the investment can be written off in the current year. Without the "1244" classification, any losses would have to be spread over several years, and this, of course, would greatly lessen the attractiveness of your company's stock. Any business owner who has not filed the 1244 corporation has in effect cut himself off from 90 percent of his prospective investors.

Particularly when sales are down, you must be "hard-nosed" with people trying to sell you luxuries for your business. When business is booming, you undoubtedly will allow sales people to show you new models of equipment or a new line of supplies; but when your business is down, skip the entertaining frills and concentrate on the basics. Great care must be taken however, to maintain courtesy and allow these sellers to consider you a friend and call back at another time.

Your company's books should reflect your way of thinking, and whoever maintains them should generate information according to your policies. Thus, you should hire an outside accountant or accounting firm to figure your return on your investment, as well as the turnover on your accounts receivable and inventory. Such an audit or survey should focus in depth on any or every item within the financial statement that merits special attention. in this way, you'll probably uncover any potential financial problems before they become readily apparent, and certainly before they could get out of hand.

Many small companies set up advisory boards of outside professional people. These are sometimes known as power Circles, and once in place, the business always benefits, especially in times of short operating capital. Such an advisory board or power circle should include an attorney, a certified public accountant, civic club leaders, owners or managers of businesses similar to yours, and retired executives. Setting up such an advisory board of directors is really quite easy, because most people you ask will be honored to serve.

Once your board is set up, you should meet once a month and present material for review. Each meeting should be a discussion of your business problems and an input from your advisors relative to possible solutions. These members of your board od advisors should offer you advice as well as alternatives, and provide you with objectivity. No formal decisions need to be made either at your board meeting, or as a result of them, but you should be able to gain a great deal from the suggestions you hear.

You will find that most of your customers have the money to pay at least some of what they owe you immediately. To keep them current, and the number of accounts receivable in your files to a minimum, you should call them on the phone and ask for some kind of explanation why they're falling behind. if you develop such a habit as part of your operating procedure, you'll find your invoices will magically be drawn to the front of their piles of bills to pay. While maintaining a courteous attitude, don't hesitant, or too much of a "nice guy" when it comes to collecting money.

Something else that's a very good business practice, but which few business owners do is to methodically build a credit rating with their local banks. Particularly when you have a good cash flow, you should borrow $100 to $1,000 from your banks every 90 days or so. Simply borrow the money, and place it in an interest bearing account, and then pay it all back at least a month or so before it's due. By doing this, you will increase the borrowing power of your signature, and strengthen your ability to obtain needed financing on short notice. This is a kind of business leverage that will be of great value to you if or whenever your cash position becomes less favorable.

By all means, join your industry's local and national trade associations. Most of these organizations have a wealth of information available on everything from details on your competitors to average industry sales figures, new products, services, and trends.

If you are given a membership certificate or wall plaque, you should display these conspicuously on your office wall. Customers like to see such "seals of approval" and feel additional confidence in your business when they see them.

Still another thing often overlooked: If at all possible, you should have your spouse work in the business with you for at least three or four weeks per year. The important thing is that if for any reason you are not available to run the business, your spouse will be familiar with certain people and situations about your business. These people should include your attorney, accountant, any consultants or advisors, creditors and your major suppliers. The long-term advantages of having your spouse work four weeks per year in your business with you will greatly outweigh the short-term inconvenience. Many couples share responsibility and time entirely, which is in most cases even more desirable.

Whenever you can, and as often as you need it, take advantage of whatever free business counseling is available. The Small Business Administration published many excellent booklets, checklist and brochures on quite a large variety of businesses. these publications are available through the U.S.Government printing office. Most local universities, and many private organizations hold seminars at minimal cost, and often without charge. You should also take advantage of the services offered by your bank and local library.

The important thing about running a small business is to know the direction in which you're heading; to know on a day-to-day basis your progress in that very direction; to be aware of what your competitors are doing and to practice good money management at all times. All this will prepare you to recognize potential problems before they arise.

In order to survive with a small business, regardless of the economic climate, it is essential to surround yourself with smart people, and practice sound business management at all times.

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How To Prepare A Business Plan That Guarantees Big Profits

Success in business comes as a result of planning. You have to have a detailed, written plan that shows what the ultimate goal is, the reason for the goal, and each milestone that must be passed in order to reach your goal.

A business plan is written definition of, and operational plan for achieving your goal. You need a complete but success tool in order to define your basic product, income objectives and specific operating procedures. YOU HAVE TO HAVE A BUSINESS PLAN to attract investors, obtain financing and hold onto the confidence of your creditors, particularly in times of cash flow shortages--in this instance, the amount of money you have on hand compared with the expenses that must be met.

Aside from an overall directional policy for the production, sales effort and profit goals of your product--your basic "travel guide" to business success--the most important purpose your business plan will serve, will be the basis or foundation of any financial proposals you submit. Many entrepreneurs are under the mistaken impression that a business plan is the same as a financial proposal, or that a financial proposal constitutes a business plan. This is just a misunderstanding of the uses of these two separate and different business success aids.

The business plan is a long range "map" to guide your business to the goal you've set for it. The plan details the what, why, where, how and when, of your business--the success planning of your company.

Your financial proposal is a request for money based upon your business plan--your business history and objectives.

Understand the differences. They are closely related, but they are not interchangeable.

Writing and putting together a "winning" business plan takes study, research and time, so don't try to do it all in just one or two days.

The easiest way to start with a loose leaf notebook, plenty of paper, pencils, pencil sharpener, and several erasers. Once you get your mind "in gear" and begin thinking about your business plan, "10,000 thoughts and ideas per minute" will begin racing thru your mind...So, it's a good idea when you aren't actually working on your business plan, to carry a pocket notebook and jot down those business ideas as they come to you--ideas for sales promotion, recruiting distributors, and any other thoughts on how to operate and/or build your business.

Later, when you're actually working on your business plan, you can take out this "idea notebook" evaluate your ideas, rework them, refine them, and integrate them into the overall "big picture" of your business plan.

The best business plans for even the smallest businesses run 25 to 30 pages or more, so you'll need to "title" each page and arrange the different aspects of your business plan into "chapters." The format should pretty much run as follows:

Title Page Statement of Purpose Table of Contents Business Description Market Analysis Competition Business Location Management Current Financial Records Explanation of Plans For Growth Projected Profit & Loss/Operating Figures Explanation of Financing for Growth Documentation Summary of Business & Outlook for The Future Listing of Business & personal References

This is a logical organization of the information every business plan should cover. I'll explain each of these chapters titles in greater detail, but first, let me elaborate upon the reasons for proper organization of your business plan.

Having a set of "questions to answer" about your business forces you to take an objective and critical look at your ideas. Putting it all down on paper allows you to change, erase and refine everything to function in the manner of a smoothly oiled machine. You'll be able to spot weakness and strengthen them before they develop into major problems. Overall, you'll be developing an operating manual for your business--a valuable tool which will keep your business on track, and guide you in the profitable management of your business.

Because it's your idea, and your business, it's very important that YOU do the planning. This is YOUR business plan, so YOU develop it, and put it all down on paper just the way YOU want it to read. Seek out the advice of other people; talk with, listen to, and observe, other people running similar businesses; enlist the advice of your accountant and attorney--but at the bottom line, don't ever forget it has to be YOUR BUSINESS PLAN!

Remember too, that statistics show the greatest causes of business failure to be poor management and lack of planning--without a plan by which to operate, no one can manage; and without a direction in which to aim its efforts, no business can attain any real success.

On the very first page, which is the title page, put down the name of your business-ABC ACTION--with your business address underneath. Now, skip a couple of lines, and write it all in capital letters: PRINCIPAL OWNER--followed by your name if you're the principal owner. On your finished report, you would want to center this information on the page, with the words "principal owner" off-set to the left about five spaces.

Examples: ABC ACTION 1234 SW 5th Ave. Anywhere, USA 00000


That's all you'll have on this page except the page number -1-

Following your title page is the page for your statement purpose. This should be a simple statement of your primary business function, such as: We are a service business engaged in the business of selling business success manuals and other information by mail.

The title of the page should be in all capital letters across the top of the page, centered on your final draft--skip a few lines and write the statement of purpose. This should be direct, clear and short--never more than (2) sentences in length.

Then you should skip a few lines, and from the left hand margin of the paper, write out a sub-heading in all capital letters, such as: EXPLANATION OF PURPOSE.

From, and within this sub-heading you can briefly explain your statement of purpose, such as: Our surveys have found most entrepreneurs to be "sadly" lacking in basic information that will enable them to achieve success. This market is estimated at more than a 100 million persons, with at least half of these people actively "searching" for sources that provide the kind of information they want, and need.

With our business, advertising and publishing experience, it is our goal to capture at least half of this market of information seekers, with our publication. MONEY MAKING MAGIC! Our market research indicates we can achieve this goal and realize a profit of $1,000,000 per year within the next 5 years...

The above example is generally the way you should write your "explanation of purpose," and in subtle definition, why you need an explanation. Point to remember: Keep it short. Very few business purpose explanations justify more than a half page long.

Next comes your table of contents page. Don't really worry about this until you've got the entire plan completed and ready for final typing. It's a good idea though, to list the subject (chapter titles) as I have, and then check off each one as you complete that part of your plan.

By having a list of the points you want to cover, you'll also be able to skip around and work on each phase of your business plan as an idea or the interest in organizing that particular phase, stimulates you. In other words, you won't have to make your thinking or your planning conform to the chronological order of the "chapters" of your business plan--another reason for the loose leaf notebook.

In describing your business, it's best to begin where your statement purpose leaves off. Describe your product, the production process, who has responsibility for what, and most importantly, what makes your product or service unique--what gives it an edge in your market. You can briefly summarize your business beginnings, present position and potential for future success, as well.

Next, describe the buyers you're trying to reach--why they need and want or will buy your product--and the results of any tests or surveys you may have conducted. Once you've defined your market, go on to explain how you intend to reach that market--how you'll these prospects to your product or service and induce them to buy. You might want to break this chapter down into sections such as..publicity and promotions, advertising plans, direct sales force, and dealer/distributor programs. Each section would then be an outline of your plans and policies.

Moving into the next chapter on competition, identify who your competitors are--their weakness and strong points--explain how you intend to capitalize on those weaknesses and match or better the strong points. Talk to as many of your "indirect" competitors as possible--those operating in different cities and states.

One of the easiest ways of gathering a lot of useful information about your competitors is by developing a series of survey questions and sending these questionnaires out to each of them. Later on, you might want to compile the answers to these questionnaires into some form of directory or report on this type of business.

It's also advisable to contact the trade associations and publications serving your proposed type of business. For information on trade associations and specific trade publications, visit your public library, and after explaining what you want ask for the librarian's help.

The chapter on management should be an elaboration on the people operating the business. Those people that actually run the business, their job, titles, duties, responsibilities and background resume's. It's important that you "paint" a strong picture of your top management people because the people coming to work for you or investing in your business, will be "investing in these people" as much as your product ideas. Individual tenacity, mature judgement under fire, and innovative problem-solving have "won over" more people than all the AAA Credit Ratings and astronomical sales figures put together.

People becoming involved with any new venture want to know that the person in charge--the guy running the business knows what he's doing, will not lose his cool when problems arise, and has what it takes to make money for all of them> After showing the "muscle" of this person, go on to outline the other key positions within your business; who the persons are you've selected to handle those jobs and the sources as well as availability of any help you might need.

If you've been in business of any kind scale, the next chapter is a picture of your financial status--a review of your operating costs and income from the business to date. Generally, this is a listing of your profit & loss statements for the six months, plus copies of your business income tax records for each of the previous three years the business has been an entity.

The chapter on the explanation of your plans for the future growth of your business is just that--an explanation of how you plan to keep your business growing--a detailed guide of what you're going to do, and how you're going to increase your profits. These plans should show your goals for the coming year, two years, and three years. By breaking your objectives down into annual milestones, your plan will be accepted as more realistic and be more understandable as a part of your ultimate success.

Following this explanation, you'll need to itemize the projected cost and income figures of your three year plan. I'll take a lot of research, an undoubtedly a good deal of erasing, but it's very important that you list these figures based upon thorough investigation. You may have to adjust some of your plans downward, but once you've got these two chapters on paper, your whole business plan will fall into line and begin to make sense. You'll have a precise "map" of where you're headed, how much it's going to cost, when you can expect to start making money, and how much.

Now that you know where you're going, how much it's going to cost and how long it's going to be before you begin to recoup your investment, you're ready to talk about how and where you're going to get the money to finance your journey. Unless you're independently wealthy, you'll want to use this chapter to list the possibilities and alternatives. Make a list of friends you can approach, and perhaps induce to put up some money as silent partners. Make a list of those people you might be able to sell as stockholders in your company--in many cases you can sell up to $300,000 worth of stock on a "private issue" basis without filing papers with the Securities and Exchange Commission. Check with a corporate or tax attorney in your area for more details. Make a list of relatives and friends that might help you with an outright loan to furnish money for the development of your business.

Then search out and make a list of venture capital organizations. Visit the Small Business Administration office in your area--pick up the loan application papers they have--read them, study them, and even fill them out on a preliminary basis--and finally, check the costs, determine which business publications would be best to advertise in, if you were to advertise for a partner or investor, and write an ad you'd want to use if you did decide to advertise for monetary help.

With listing of all the options available to your needs, all that's left is the arranging of these options in the order you would want to use them when the time come to ask for money. When you're researching these money sources, you'll save time by noting the "contact" deal with when you want money, and whenever possible, by developing a working relationship with these people.

If your documentation section, you should have a credit report on yourself. Use the Yellow Pages or check at the credit department in your bank for the nearest credit reporting office. When you get your credit report, look it over and take whatever steps are necessary to eliminate any negative comments. Once these have been taken care of, ask for a revised copy of your report and include a copy of that in your business plan.

If you own any patents or copyrights, include copies of these. Any licenses to use someone else's patent or copyright should also be included. If you own the distribution, wholesale or exclusive sales rights to a product, include copies of this documentation. You should also include copies of any leases, special agreements or other legal papers that might be pertinent to your business.

In conclusion, write out a brief, overall summary of your business- when the business was started, the purpose of the business, what makes your business different, how you're going to gain a profitable share of the market, and your expected success during the coming 5 years..

The last page of your business plan is a "courtesy page" listing the names, addresses and phone numbers of personal and business references--persons who have known you closely for the past five years or longer--and companies or firms you've had business or credit dealings with during the past five years.

And, that's it--your complete business plan. Before you send it out for formal typing, read it over once a day for a week or ten days. Take care of any changes or corrections, and then have it reviewed by an attorney and then, an accountant. It would also be a good idea to have it reviewed by a business consultant serving the business community to which your business will be related. After these reviews, and any last-minute changes you want to make, I'll be ready for formal typing.

Hire a professional typist to type the entire plan on ordinary white bond paper. Make sure you proof-read it against the original. Check for any corrections and typographical errors--then one more time--read it through for clarity and the perfection you want of it.

Now you're ready to have it printed and published for whatever use you have planned for it--distribution amongst your partners or stockholders as the business plan for putting together a winning financial proposal, or as a business operating manual.

Take it to a quality printer in your area, and have three copies printed. Don't settle for photo-copying..Have it printed!

Photo-copying leaves a slight film on the paper, and will detract from the overall professionalism of your business plan, when presented to someone you're trying to impress. So, after going to all this work to put together properly, go all the way and have it duplicated properly.

Next, stop by a stationery store, variety store or even a dime store, and pick up an ordinary, inexpensive bind-in theme cover for each copy of your business plan. Have the holes punched in the pages of your business report to fit these binders and then slip each copy into a binder of its own.

Now, you can relax, take a break and feel good about yourself..You have a complete and detailed business plan with which to operate a successful business of your own. A plan you can use as a basis for any financing proposal you may want to submit..And a precise road-map for the attainment of real success...

Congratulations, and my best wishes for the complete fulfillment of all your dreams of success!!!

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Wednesday, June 14, 2006

21 Steps to Home Business Success

Fifty million home-based businesses will be in operation by 1997, according to Link Resource's National Work-at Home Survey. All around the country, people who want more control over their lives are starting home businesses

In New Orleans, Rick Hart's home based cajun Cargo ships seafood nation wide. In Palatine, Illinois, Stephaine Heavey works from home designing and selling original patterns for fabric dolls. And in Dallas, Lisa McElya published the Dallas Party & Event Planners Guidebook from the entire first floor of her two-story home.

These three people are living the new American dream of owning a business, but avoiding the high overhead and start-up costs of a commercial location. If the idea of working from home is appealing, but you don't know where to begin, here is a step-by-step guide.


Select an area away from family activity. The perfect space is a separate room (or perhaps the garage), but any area will do, if it can hold all the business supplies and equipment, and also provide enough work space for desks, tables, or counters.


Many people start a home business on a part-time basis while raising children or working outside the home. Others start full-time when family and finances allow. However you begin, figure out how may hours per week you can devote to the business Make a weekly chart of your activities, examine it, and determine where the business fits. Don't assume you have time and find out later you don't.


Make a list of things you like to do, your work and volunteer experience, and items you own that can be used in a business. Look over this line-up, and using ideas from it, list possible businesses to start. Eliminate any business that isn't appealing or doesn't fill a need people have.

For ideas on different types of businesses, consult the end of this article. Other ideas can be found in the source material listed at the end of this article.


The three basic legal forms are sole proprietorship, partnership, and corporation. The most common is the sole proprietorship. As its name implies, a sole proprietorship is owned by one individual. It is the oldest form of business, the easiest to start, and the least complicated to dissolve. Here are some of the advantages of this business form:

  1. You own all the profits
  2. Your business is easy and cheap to organize. You don't need any government approval, although you may be required to carry a city, state or county license. Your only other obligation is to notify the Internal revenue Service (IRS) for the purposes of sales tax.
  3. You're the boss
  4. You enjoy certain tax savings. You must pay regular individual taxes on your income, property, and payroll, but these are not levied as special taxes, as with a corporation. You will also have to pay sales tax which you have received from your customers.
  5. Greater personal incentive and satisfaction. Since you have your investment to lose if your business is not successful, you should be more willing to put time, thought, and energy into the business. And when your business is successful, you enjoy maximum sense of accomplishment since you know its success was dependent upon your decisions about your management ability alone.

For more information about this and other forms of business, send for the U.S. Small Business Administration (SBA) Publication MP25. Selecting the Legal Structure for Your BUsiness (50 cents). It outlines the advantages and disadvantages of each legal type of structure. If after reading it you are still uncertain what form of the business should take, consult an attorney.


There are three ways to finance start-up costs: use your own money, obtain a loan, or find investors. If possible, it is better to start small, use your savings, and not worry about repaying a debt. also keep in mind that since you are a home-based, chances of qualifying for a loan or finding investors are slim until the success of your idea is proven.


Spend a few weeks researching home-based businesses. A library or bookstore can provide numerous books on business basics, and on the specific type of business that interest you. Homemade Money by Barbara Brabee (see sources) is an excellent book to start with.

If you are considering a computer business, get in touch with the association of Electronics; Cottagers, P.O. Box 1738, Davis, CA 95617-1738. To keep informed of what is happening in home business world, contact National Home Business report, P.O. Box 2137, Naperville, IL 60566, for subscription information; and Mothers Home Business Network, P.O. Box 423, East Meadow, NY 11554 (send SASE for free information).


Find out how your property is zoned, the call City Hall and ask what regulations apply to home businesses in that zone. Also, if you rent or live in a condominium, check the lease or homeowner's association rules to be certain a home business is allowed.

Generally, if you do not annoy your neighbors with excess noise, odors, and traffic, you will not be deterred from running a business at home. The neighbors may not even be aware of the business, but it is necessary to know exactly what you can and can't do before you start. This is important should any problems or questions arise later.


If the business you choose is different form your name, file an assumed (or fictitious) name certificate with the county. You are notified if another business already has that name, so you can select a new one.

Do this before investing in expensive stationery and brochures. It costs only a few dollars to file, and it protects the business name from being used by someone else in the county.


A good business plan clarifies your ideas and establishes a plan of action. A good business plan should include a description of what you are selling, your background and qualifications, who the prospective customers are and where they can be found, what is needed to build the business, how you plan to promote, and how much money is need for start-up costs.

SBA Publication #M925, The Business Plan for Home-Based Business ($1) is helpful.


If you are the sole proprietor of the business and have no employees, you may either use your Social Security number or an Employee Identification Number (EIN) as the business number on official forms. If you have employees, or the business is set up as a partnership or corporation, you must obtain an EIN. To do this, complete IRS Form SS-4 (Application for Employer Identification Number) and file it with the nearest IRS Center.


If the product or service you sell is taxable, you need a state sales tax permit. Call the local tax agency, explain the type of business you have and what you sell, and ask if you need to collect sales tax. If you do, they will send you the necessary information and forms to complete. You also use this tax number when your purchase items for resale.


It's very important not to overlook any necessary license or permit. For example, some cities and counties require a general business license, and most have special laws regarding the preparation and sale of food.

Call City Hall to find out what is need for your particular business. In addition, Chamber of Commerce provide information on city, county and state licenses and permits.


Spend time on the color, design and paper for these items. They make a definite impression-good or bad- on the people who receive them. If you are not certain what is most suitable and effective, consult a graphics designer or a creative printer whose work you like.


Call several banks to find out what services they offer, and what minimum balance, if any, must be maintained to avoid paying a service charge. Also ask about credit card if you plan to offer this convenience to your customers. Bank fees can be significant, so shop around for the best deal.

If your personal checking account is with a credit union, see if it can also provide a separate business account. when you open your account, you may need to show the assumed name certificate and business license.

Finally, investigate obtaining a credit card in the business's name. If this is not possible, set aside a personal credit card to use for business expenses.


Put together a simple and effective bookkeeping system with an 8 1/2 x 11" three-ring binder, columnar pad sheets and twelve pocket dividers from the office supply store. For each month, set up columnar sheets for income and expenses. Use a pocket divider for each month's receipts, bank statement, deposit tickets, and canceled checks.

In addition, an automobile log for business mileage, and filing system for correspondence, invoices, supplier catalogs, client records, etc. are two other useful tools.

For more information on record-keeping, see IRS publication #583, Information for Business taxpayers.


If you comply with basic IRS guidelines, you can deduct a percentage of normal household expenses (mortgage, interest, taxes, insurance, utilities, repairs, etc.) as a business expense. see the box accompanying this article and, for more detailed information, IRS publication #587, Business Use of the Home.

Also become familiar with these IRS forms: Schedule SE (compensation of Social Security Self-Employment Tax) and Schedule 1040 ES (estimated Tax for Individuals). Depending on circumstances, you may have to file them.


Make a list of everything needed to start the business, but before you buy anything, look around the house for things you already own that are usable.

When you are ready to start purchasing, check the classified ads and garage sales. Both are good, inexpensive sources for office furniture, typewriters, computers, answering machines, etc. But only what is absolutely necessary for start-up, and wait until the business is off the ground to get the extras.


Call the telephone company to find out the cost of a business phone in your area. If you cannot afford a separate business line, investigate the telephone company's regulations on using your personal phone in a business. It may be possible to do this if you follow certain guidelines. Keep a record of long distance business calls as they are a deductible expense. Finally, consider the benefits of an answering machine to catch calls when you are out.


Using a post office box as the business address down plays the fact you are home-based. It also prevents customers from dropping in at all hours.

While looking into box rental, ask for information on the various postal rates, particularly bulk rate, if you plan to do large or specialized mailings. If you mail many packages, check out United Parcel Service (UPS), as it is less expensive than the Post Office.


Check with your homeowners insurance agent about a rider for your existing policy or the need for a separate business policy. Also make sure you have adequate personal and product liability coverage. Shop around, as each company has different rules regarding home businesses

To save money on medical insurance, join an association and participate in their group plan. One such body is The National association for the Self-Employed: they can be reached at 800-527-5504.


To have more time for business, organize and simplify household routines. Start by holding a garage sale to get rid of unnecessary possessions. Next, have a family conference and divide household duties, making sure each person does his or her part. The, set up a planning notebook to keep track of appointments, things to do, calls to make, errands to run, shopping, etc. Finally, set up a work schedule so you won't get sidetracked by TV, neighbor's visits, snacking, and telephone calls.

Creating and operating a home business is a wonderful and rewarding challenge. The satisfaction is not only in the money earned, but in doing what makes you happy.

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Earning extra income from your site

There are several types of affiliate programs.

Let's take a closer look at each of them.

1. PAY PER SALE (commission based)
You get paid a commission for each sale you generate. If you refer a visitor to the merchant's site and the visitor makes a purchase, you get a percentage of the sale as a commission. Some programs offer a sliding scale for the amount of commission to reward affiliate sites with high traffic, while other programs stick to a flat commission rate for any level of sales. Depending on the merchant, the commission may be for that purchase only, for all purchases that customer makes within a fixed period of time (usually six months to one year), or for all the purchases that customer makes in his or her lifetime.

Advantages to you
You get paid for every sale that is generated through a referrer from your web site. If the affiliate program matches the content of your site, you are likely to get good results from a commission based pay-per-sale system.

Disadvantages to you
This kind of program usually has a low click-thru to conversion rate. This means most likely only a small percentage of your visitors will click on the banner or link advising them to buy. Of that percentage, an even smaller percentage will actually buy something. You may find that there have been thousands of visits to your site and yet no sales. The more you can focus your affiliate program and integrate it into your site, the better your chances for making real money will be.

Advantages to merchant
The merchant basically gets a free shopping front and with many sites like yours, they can reach a widespread audience.

Disadvantages to merchant
He will be paying your commissions out of his own gross margin.

2. BOUNTY (flat fee referral)
You get a one-time bounty payment for the customer you referred. You will not get commission on any future purchases that customer makes. Usually, companies pay a bounty of $10-$20 per customer.

Advantages to you
You get paid for every visitor you send to the target site that buys something.

Disadvantages to you
Your web site needs to have new visitors all the time. You only get paid for the referral once, even if the referred client keeps ordering from the merchant or purchases a service yearly.

Advantages to merchant
You place their banner(s) on your site for FREE, so they don't pay for the advertising. It's the cheapest advertising a merchant can get. 5.000 page views could cost up to $100, now only $10-$20. A customer could be buying from merchant for years, you only get the fee once.

Disadvantages to merchant
None. He receives free advertising and the cost for each new-found customer is once and very little.

You get paid for every visitor you send to the online merchant through a banner or text link, regardless of whether or not a sale is made. Usually, companies pay $0.05 - $0.10 per click per visitor.

Advantages to you
You get paid for every visitor you send to the target site, not only for the smaller number of visitors who actually buy something there.

Disadvantages to you
In most cases you will end up making little money (site with average page views will display f.e. 5000 banner impressions, of which 20 visitors click thru, resulting in a whole $2 income. Wow!

Advantages to merchant
You place their banner(s) on your site for FREE (that's right, they don't pay for the advertising) and you get very little in return. It's the cheapest advertising a merchant can get. 5.000 page views could cost up to $100, now only $2. The more page views you have, the cheaper it gets for the merchant.

Disadvantages to merchant
None. He receives almost free advertising.

You get commission on direct sales that you generate, plus you get commission on sales generated by affiliates that you recruit. Companies typically pay 15% commission for direct sales and 5% for sales generated by the affiliates you recruit. Same (dis)advantages apply as for the pay-per-sale programs.

You get paid a one-time fee for generating a lead for the merchant. Similar to a bounty program, you usually earn $2-$5 if the visitor you referred fills out a questionnaire or an application. Same (dis)advantages apply as for the Bounty programs.

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Monday, January 09, 2006

Monetize Your WebSite with Google Adsense

Discover your site's full revenue potential.

Google AdSense is a fast and easy way for website publishers of all sizes to display relevant Google ads on their website's content pages and earn money. Because the ads are related to what your visitors are looking for on your site — or matched to the characteristics and interests of the visitors your content attracts — you'll finally have a way to both monetize and enhance your content pages.

Apply for Adsense!

It's also a way for website publishers to provide Google web and site search to their visitors, and to earn money by displaying Google ads on the search results pages.