thecastlestonegroup

Understanding PPP

david.reno@yahoo.com (David Reno) — Mon, 01 Jun 2020 14:56:57 GMT

Loan Details

The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on payroll. First Draw PPP Loans can be used to help fund payroll costs, including benefits, and may also be used to pay for mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.

Who may qualify

The following entities affected by Coronavirus (COVID-19) may be eligible:

Sole proprietors, independent contractors, and self-employed persons
Any small business concern that meets SBA’s size standards (either the industry size standard or the alternative size standard)
Any business, 501(c)(3) non-profit organization, 501(c)(19) veterans organization, or tribal business concern (sec. 31(b)(2)(C) of the Small Business Act) with the greater of:
500 employees, or
That meets the SBA industry size standard if more than 500

Any business with a NAICS code that begins with 72 (Accommodations and Food Services) that has more than one physical location and employs less than 500 per location

Small businesses and non-profits with fewer than 20 employees and sole proprietors can apply for Second Draw PPP loans from February 24 through March 9, 2021. The program will be open to all eligible entities March 10 through March 31, 2021.

Reference: https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/paycheck-protection-program/first-draw-ppp-loans

Building Your Business Credit

david.reno@yahoo.com (David Reno) — Mon, 16 Sep 2019 15:02:07 GMT

If your business is new and doesn't have a credit history, use these eight tips to start building your business credit score.

Small business finance often mires personal investment and credit with business purchases and expansion. By establishing a business credit score, you can take an important first step toward creating a dividing line between your business and personal finances, even if you're running a sole proprietorship or partnership.

How to build business credit

The importance of a good business credit score is unparalleled, but how can you build a good credit score from the ground up? The first step is to establish your business legally and file with various business credit reporting agencies. The second step is to develop good financial habits to maintain your credit score. Finally, you'll want to monitor your score throughout the year to ensure your score accurately reflects the positive financial habits you're developing.

Here is a detailed step-by-step guide to building business credit:

1. Establish your business.

The first step toward building business credit is to establish your business legally as a s ole proprietorship, corporation, partnership or limited liability company. Create a legal name, and set up a business phone number, which will give your company added credibility with vendors and the government. Once the basic legal aspects of your company are created, begin opening accounts with vendors that report to the credit bureaus to establish your business credit file and start building credit. As with legally creating your business, this makes your company known to business credit reporting agencies.

2. Register your business with your secretary of state.

Depending on the type of business you establish as a legal entity, you may have already completed this in step 1. It is important, however, to confirm that you've completed all of the steps required by the secretary of state to ensure your business has been registered and created properly.

3. Get your EIN.

Your EIN (Employer Identification Number) is like your business's Social Security number; it's what the government uses to identify your business. Your EIN is also a major piece of information for paying business taxes throughout the year. By requesting this number once your business is registered, you're gaining a corporate ID number that you will use to file taxes, open a business bank account and apply for business licenses.

4. Open a business bank account.

Get started on separating your business finances from your personal finances by establishing a business bank account. Setting up this type of account will also help you get a business credit card and begin building a relationship with a banking partner that may be beneficial down the road if you need a small business loan to grow your operations.

5. Continue building relationships with vendors.

As you build your business, continue establishing and building relationships with vendors, and create contracts for supplies and other business materials. You build credit by paying on time or early with vendors that report to credit agencies. Not all do, and not all vendors report to the same credit agencies. Consider what your business needs, then look up which vendors in that vertical report to credit agencies.

6. Use your business credit card.

Opening, using and paying off business credit cards is another way to build business credit. Once your bank account is established and your business is in operation, open a business credit card and use it each month. Some cards may offer rewards that can be advantageous for certain types of businesses. Keep in mind that, especially if you've just started your business, your credit limit may be rather low when you start out. As you build your credit score, your credit limit will increase.

7. Pay early and often.

One of the most powerful tools you have when building credit is simply paying your bills. By paying your bills in full and on time, you're proving that you can make good on your debts. If you pay bills early, however, you may be able to build your business credit score even faster. Credit is essentially an agreement between you and a lender that you'll pay them later for a product or service (or access to money, in the case of credit cards) you need now. So, when bills come due, make sure you pay them. This is the most basic concept behind building credit.

8. Focus on credit utilization.

An important aspect of building a credit score is credit utilization. Much like with personal credit cards, business credit cards have a recommended usage so you can maximize your credit score. It's recommended that a business owner use no more than 30% of your total limit. This proves to lenders that you're not only financially responsible but more than able to meet your minimum balance each month.

Setting Up Your Business

david.reno@yahoo.com (David Reno) — Mon, 16 Sep 2019 14:54:56 GMT

10 Steps to Start a Small Business

There are more than 28 million small businesses in the United States, making up a whopping 99.7 percent of all U.S. businesses, according to the S mall Business Administration. When you consider some of the most popular reasons to start a business, including having a unique business idea, designing a career that has the flexibility to grow with you, working toward financial independence, and investing in yourself — it's no wonder that small businesses are everywhere.

But not every small business is positioned for success. In fact, only about two-thirds of businesses with employees survive at least two years, and about half survive five years. So you may be in for a real challenge when you decide to take the plunge, ditch your day job, and become a business owner. The stage is often set in the beginning, so making sure you follow all of the necessary steps when starting your business can set the foundation for success.

Here are 10 steps that are required to s tart a business successfully. Take one step at a time, and you'll be on your way to successful small business ownership.

Step 1: Do Your Research

Most likely you have already identified a business idea, so now it's time to balance it with a little reality. Does your idea have the potential to succeed? You will need to run your business idea through a validation process before you go any further.

In order for a small business to be successful, it must solve a problem, fulfill a need or offer something the market wants.

There are a number of ways you can identify this need, including research, focus groups , and even trial and error. As you explore the market, some of the questions you should answer include:

Is there a need for your anticipated products/services?
Who needs it?
Are there other companies offering similar products/services now?
What is the competition like?
How will your business fit into the market?

Don't forget to ask yourself some questions, too, about starting a business before you take the plunge.

Step 2: Make a Plan

You need a plan in order to make your business idea a reality. A business plan is a blueprint that will guide your business from the start-up phase through establishment and eventually business growth, and it is a must-have for all new businesses.

The good news is that there are different types of business plans for different types of businesses.

If you intend to seek financial support from an investor or financial institution, a traditional business plan is a must. This type of business plan is generally long and thorough and has a common set of sections that investors and banks look for when they are validating your idea.

If you don't anticipate seeking financial support, a simple one-page business plan can give you clarity about what you hope to achieve and how you plan to do it. In fact, you can even create a working business plan on the back of a napkin, and improve it over time. Some kind of plan in writing is always better than nothing.

Step 3: Plan Your Finances

Starting a small business doesn't have to require a lot of money, but it will involve some initial investment as well as the ability to cover ongoing expenses before you are turning a profit. Put together a spreadsheet that estimates the one-time startup costs for your business (licenses and permits, equipment, legal fees, insurance, branding, market research, inventory, trademarking, grand opening events, property leases, etc.), as well as what you anticipate you will need to keep your business running for at least 12 months (rent, utilities, marketing and advertising, production, supplies, travel expenses, employee salaries, your own salary, etc.).

Those numbers combined is the initial investment you will need.

Now that you have a rough number in mind, there are a number of ways you can fund your small business, including:

Financing
Small business loans
Small business grants
Angel investors
Crowdfunding

You can also attempt to get your business off the ground by bootstrapping, using as little capital as necessary to start your business. You may find that a combination of the paths listed above work best. The goal here, though, is to work through the options and create a plan for setting up the capital you need to get your business off the ground.

Step 4: Choose a Business Structure

Your small business can be a sole proprietorship, a partnership, a limited liability company (LLC) or a corporation. The business entity you choose will impact many factors from your business name, to your liability, to how you file your taxes.

You may choose an initial business structure, and then reevaluate and change your structure as your business grows and needs change.

Depending on the complexity of your business, it may be worth investing in a consultation from an attorney or bookkeeping/accounting firm to ensure you are making the right structure choice for your business.

Step 5: Pick and Register Your Business Name

Your business name plays a role in almost every aspect of your business, so you want it to be a good one. Make sure you think through all of the potential implications as you explore your options and choose your business name.

Once you have chosen a name for your business, you will need to check if it's trademarked or currently in use. Then, you will need to register it. A sole proprietor must register their business name with either their state or county clerk. Corporations, LLCs, or limited partnerships typically register their business name when the formation paperwork is filed.

Don't forget to register your domain name once you have selected your business name. Try these options if your i deal domain name is taken.

Step 6: Get Licenses and Permits

Paperwork is a part of the process when you start your own business. There are a variety of s mall business licenses and permits that may apply to your situation, depending on the type of business you are starting and where you are located. You will need to research what licenses and permits apply to your business during the start-up process.

Step 7: Choose Your Accounting System

Small businesses run most effectively when there are systems in place. One of the most important systems for a small business is an accounting system.

Your accounting system is necessary in order to create and manage your budget, set your rates and prices, conduct business with others, and file your taxes. You can set up your accounting system yourself, or hire an Accounting/Bookkeeping firm like The Castlestone Group to take away some of the guesswork.

Step 8: Set Up Your Business Location

Setting up your place of business is important for the operation of your business, whether you will have a home office, a shared or private office space, or a retail location.

You will need to think about your location, equipment, and overall setup, and make sure your business location works for the type of business you will be doing. You will also need to consider if it makes more sense to buy or lease your commercial place.

Step 9: Get Your Team Ready

If you will be hiring employees, now is the time to start the process. Make sure you take the time to outline the positions you need to fill, and the job responsibilities that are part of each position. The Castlestone Group has an excellent g uide to hiring first employees that is useful for new small business owners.

If you are not hiring employees, but instead outsourcing work to independent contractors, now is the time to work with an attorney or The Castlestone Group to get your independent contract agreement in place and start your search.

Lastly, if you are a true solopreneur hitting the small business road alone, you may not need employees or contractors, but you will still need your own support team. This team can be comprised of a mentor, small business coach, or even your family, and serves as your go-to resource for advice, motivation and reassurance when the road gets bumpy.

Step 10: Promote Your Small Business

Once your business is up and running, you need to start attracting clients and customers. You'll want to start with the basics by writing a u nique selling proposition (USP) and creating a marketing plan. Then, explore as many s mall business marketing ideas as possible so you can decide how to promote your business most effectively.

Once you have completed these business start-up activities, you will have all of the most important bases covered. Keep in mind that success doesn't happen overnight. But use the plan you've created to consistently work on your business, and you will increase your chances of success.

Secrets for Growing Your Business Quickly

david.reno@yahoo.com (David Reno) — Mon, 16 Sep 2019 14:49:39 GMT

There's no surefire formula for instant success, but you can boost your business's growth with these tips from startup founders.

New business owners have numerous goals when they're starting out, including rapid growth and recognition for their fledgling venture. But overnight success isn't often the standard: There's no specific "special sauce" to add to the recipe for instant results, and nothing is guaranteed. However, there are ways to reach growth milestones that can catapult a business to success. We asked small business leaders to share their tips for accelerating growth.

Hire the right people

Before you can even think about your company's growth trajectory, you need to ensure that you have a solid staff that can help you achieve it.

"With a small business looking to grow, it's important to have the right players at the table," said April Davis, founder of online dating service Cupid's Cronies. "They need to be people who aren't afraid to roll up their sleeves. The words 'That's not my job,' do not exist in their vocabulary. They have to be dedicated to the mission."

"Hiring the absolute best people you can is a surefire way to ensure fast growth," added Christian Lanng, CEO and chairman of business software provider Tradeshift. "It's all about having the right team."

Focus on established revenue sources

Rather than trying to acquire new customers, direct your attention to the core customers you already have, said Bill Reilly, a Wisconsin-based auto repair entrepreneur. You can do this by implementing a referral or customer loyalty program, or trying out marketing strategies based on previous purchase behaviors to encourage repeat business, he said.

This focus on your established market is especially important if you're trying to get funding.

"In the past, we would highlight our business goal to become a franchise, which didn't resonate with banks," Reilly said. "We learned to emphasize that there is a large market for what we do. This would pique a banker's interest because he or she cares about the return on investment more than your business aspirations."

Reduce your risks

Risk is an inevitable part of starting and growing a business. It's impossible to control everything, but there are plenty of ways to limit internal and external threats to your company and its growth. One important resource to help you accomplish this is your business insurance provider.

"Small businesses need to manage their growth to avert disruptions that can bring business to a grinding halt," said Mike DeHetre, vice president of product development at Travelers. For example, "the theft of employee data, customer records and product designs can destroy a small business, generating significant costs and eroding customer confidence and loyalty," he said. "Not every business owner's policy covers data breaches or other cyber losses. Small businesses should be prepared by seeking insurance products that help them recover, including those that cover the cost of remediation and lawsuits."

As small businesses grow, they may add space or equipment, create new products or services, or increase their operating and distribution footprint, so DeHetre advised periodically reviewing your policy to ensure you have the right coverage.

"It's easy to forget this step amid rapid expansion, but you don't want to find out that you've outgrown your coverage just when you need it the most," DeHetre said.

Be adaptable

One trait that successful startups often have in common is the ability to switch directions quickly in response to changes in the market. Lanng noted that an agile approach to development, both in terms of your product and your company, will help you grow more quickly.

"By allowing yourself to adapt and change quickly, you're able to test different approaches to business and find out what works best," Lanng told Business News Daily. "It allows you to fail, pick yourself back up and keep going."

Chris Cornell, founder and CEO of Manhead Merchandise, said his company has found adaptability to be key in expanding its client base beyond the music industry.

"Look to current pop culture trends for an opportunity to become part of the movement, when it makes sense," Cornell said. "In an era of internet-fame, we looked to expand our horizons beyond the music industry. We partnered with 'The King of Pop Culture' and insta-famous pup, D oug the Pug, to release his new gear. Recognizing the reach and popularity of Doug, we were able to take his merchandise to the next level, extending our business model beyond bands."

Focus on your customer experience

Customers' perceptions of your business can really make or break a business. Deliver quality experiences and products, and they'll quickly sing your praises on social media; mess it up, and they'll tell the world even faster. Fast growth depends on making your current and potential customers happy with their experience, DeHetre said.

"Compared with large companies, small businesses are nimble, and often better able to see, anticipate and respond to their customers' needs," DeHetre said. "The most successful small businesses exploit this advantage, by bringing new and innovative products and services to market more quickly and developing and nurturing long-term customer relationships."

Dennis Tanjeloff, president and CEO of Astro Gallery of Gems , agreed. He said listening to your customers and giving them what they want is of utmost importance.

"Diversify your offerings so you can best cater to the customers' changing tastes," Tanjeloff said. "Remember, you are here to serve the customer — it's why you are open for business."

Cornell noted that engaging with your audience is crucial, but personalizing the experience can boost and strengthen that relationship.

"At Manhead, we come up with unique creative designs, customized storefronts and pop-up shops personalized for each band [we work with] to help them engage with fans in a new way," Cornell said.

Invest in yourself

In the early stages of your business, you'll likely see a very lean profit margin (or no profit at all), so any money you do make should go directly toward helping you grow.

"A startup's ability to invest in itself [helps] accelerate growth," Lanng said. "In those early years, it's critical to make sure that you're redirecting any revenues back into the company. It's vital to invest early and heavily in order to grow quickly."

Always think ahead

While agility is an important quality for a startup, you can't fly by the seat of your pants when you're running a business. Planning your next step, even if that means anticipating all possible scenarios, is the best way to stay grounded and secure as your business evolves.

"Set the foundation in place, water it and watch it grow," Davis said. "If you do the foundational work, when you experience growth, it won't be that difficult to adjust, since the hard part is already done."

Boost customer service

According to S mall Business Trends, another great method of growing your business quickly is by focusing on providing superior customer service. When you exceed customers' expectations, they are likely to tell their friends, family and followers about your business. Further, when you go out of your way, such as offering discounts if a customer has a poor experience or following up to ensure a client was satisfied with your product or service, you establish a reputation for having great customer service.

Focus on social media

Another method to grow your business is to create profiles on all of the major social media platforms (Instagram, Facebook, Twitter, etc.). Creating a profile allows you to better market your and interact with far more potential customers. Too, when your business has an account (and is updated regularly on each site) on the major platforms, consumers can find your business more easily, and they are likely to share your business with their friends.

Attend networking events

Attending networking events allows you to connect with like minds, many of which have unique perspectives and insights that you wouldn't find elsewhere that can help you grow your business. The connections and relationships that come from attending networking events can be beneficial for years to come.

Work on corporate social responsibility

Consumers want to buy from businesses that are passionate about causes that help make the world a better place. Whether you choose to donate to cancer research or support a nonprofit providing solutions to homelessness, look for ways to provide a meaningful contribution to the causes you support and share that with your customers.