Are you a sole trader wondering whether or not you should incorporate your small business? Hopefully this article will spell out some of the key benefits that you could expect to see from small business incorporation.
Incorporation could be the right step for you if you're planning to grow your business going forward. Incorporation will make it easier for you to attract additional funding, either in the form of capital investment or loan finance. Also, should your business hit financial difficulties in the future, incorporation will give you limited liability protection from the company's debts and liabilities. We'll discuss these benefits more fully below.
Firstly, let's discuss why incorporating your small business makes it easier to raise additional funding for the growth of your company.
Incorporation provides your business with a formal share structure, and so the issuing and valuation of shares becomes significantly more straightforward, making it easier to raise funds via additional capital investment.
Incorporation also gives your company increased credibility with the financial institutions and therefore makes it easier to attain additional finance.
Next let's look at the subject of personal liability protection.
When you incorporate your small business, it's status changes to become a totally independent legal entity. As a result, you get personal liability protection from any debts incurred by the business. Once incorporated, as a shareholder you will only be personally liable for the debts of the company up to the amount of equity you invested in the newly formed company.
In other words, the business's creditors will only be eligible to payment of amounts owed from the assets of the incorporated company and not from the personal assets of the shareholders and directors.
Personal liability protection is obviously one of the most attractive benefits of small business incorporation. It effectively removes the risk to your personal assets that comes with being the owner of a small business.
As well as the benefits already mentioned, there may also be tax advantages to incorporating your small business.
Wednesday, December 24, 2008
Sunday, December 14, 2008
Marketing in a Recession - How to Keep Your Small Business Growing When the Economy Isn't
If you're concerned about how you're going to navigate your business through the economic minefield that's expected to last for the foreseeable future, you've got good reason to be. Running a small business isn't a picnic at the best of times, and with consumers expected to tighten their belts and employees bracing for corporate cut-backs, your first reaction may be to retreat, cut your marketing, downsize, and trim expenses.
For smaller companies, there usually isn't much fat to trim, and if your business takes a dip it can make for extreme financial pressures and gut-wrenching decisions. So what's the best strategy to keep your business moving forward when the economic outlook is doom and gloom? Reassess your plan, maximize low-cost promotional opportunities, be as creative as possible, and stay aggressive with your marketing.
1. Don't wait to see if your business is going to suffer because of global economic issues, take immediate action now. Review every detail of your marketing programs and prioritize each one to determine where you can reduce expenses if you absolutely have to.
2. Focus your advertising. If you can't track measurable results from your advertising, cut back in favour of other opportunities. In tough times you need to focus more on initiatives that deliver direct results and target the exact audience you want to reach, at the expense of ads that look good but aren't generating any direct sales.
3. Get creative. Creative promotions, offers, and ideas attract more attention, generate more interest, result in more word of mouth advertising, and have a longer 'shelf-life'. Use your imagination or borrow ideas from other industries to keep your marketing as fresh and creative as possible.
4. Connect (and reconnect) with your customers. Re-introduce your company to past customers and work closely with your current clients to let them know you care about their business, to find out what new services you could offer, to help generate more referrals, and to determine where you should focus your resources.
5. Become a guerrilla marketer. Host a seminar, write an article, network more than ever, develop partnerships with other businesses, and use your size and speed to your advantage by responding quickly to the needs of your customers.
6. Ramp up your online marketing. Google's predicting their business will continue to soar even as the economy sours because they offer low-cost advertising tools that will be embraced by businesses looking to save money during the current economic downturn. Now's the time to capitalize on e-marketing to reach new markets, closely target your customers, and get more value out of every dollar you spend.
Believe it or not, a shrinking economy can create an opportunity for your business as consumers and companies alike look for new ways to save money. And as many businesses will inevitably cut back and reduce services to preserve their bottom line, this opens the door for someone else to steal their customers by offering new services, adding more value, and going the extra mile.
For smaller companies, there usually isn't much fat to trim, and if your business takes a dip it can make for extreme financial pressures and gut-wrenching decisions. So what's the best strategy to keep your business moving forward when the economic outlook is doom and gloom? Reassess your plan, maximize low-cost promotional opportunities, be as creative as possible, and stay aggressive with your marketing.
1. Don't wait to see if your business is going to suffer because of global economic issues, take immediate action now. Review every detail of your marketing programs and prioritize each one to determine where you can reduce expenses if you absolutely have to.
2. Focus your advertising. If you can't track measurable results from your advertising, cut back in favour of other opportunities. In tough times you need to focus more on initiatives that deliver direct results and target the exact audience you want to reach, at the expense of ads that look good but aren't generating any direct sales.
3. Get creative. Creative promotions, offers, and ideas attract more attention, generate more interest, result in more word of mouth advertising, and have a longer 'shelf-life'. Use your imagination or borrow ideas from other industries to keep your marketing as fresh and creative as possible.
4. Connect (and reconnect) with your customers. Re-introduce your company to past customers and work closely with your current clients to let them know you care about their business, to find out what new services you could offer, to help generate more referrals, and to determine where you should focus your resources.
5. Become a guerrilla marketer. Host a seminar, write an article, network more than ever, develop partnerships with other businesses, and use your size and speed to your advantage by responding quickly to the needs of your customers.
6. Ramp up your online marketing. Google's predicting their business will continue to soar even as the economy sours because they offer low-cost advertising tools that will be embraced by businesses looking to save money during the current economic downturn. Now's the time to capitalize on e-marketing to reach new markets, closely target your customers, and get more value out of every dollar you spend.
Believe it or not, a shrinking economy can create an opportunity for your business as consumers and companies alike look for new ways to save money. And as many businesses will inevitably cut back and reduce services to preserve their bottom line, this opens the door for someone else to steal their customers by offering new services, adding more value, and going the extra mile.
Monday, December 1, 2008
How to Attract and Keep Customers in Your Small Business - (Do the Marketing)
1. Understand what you do. What makes your business special? What is unique, different, important? Be able to clearly answer the question, "Why should I choose to turn my money over to your business when there are so many other choices." Remember that business is all about serving others. They are the only ones who will put money in your bank account. The more a business is about serving others and the less it is about you and your needs the better it will work.
2. Customers are the focal point of your business. Who are they? What motivates them? Are they rich or poor? Educated or not? Where are they? Create a mental image of a customer you would like to serve and use this image when you are creating marketing campaigns. Make sure that you direct you message to this customer and not to some general population. Really try to connect with people.
3. Attract new customers. There are many ways to do this. Depending on who your customer is, some methods will work better than others. Once you understand who your customer is you will better be able to identify where he is to be found. The better you can focus and direct your marketing efforts to those people most likely to actually pay for what you do the better it will work. Some different media that may be useful to you:
* Direct Mail
* Newspaper and Magazine
* Yellow Pages
* Signs and Billboards
* Website
* Pay Per Click
* Vehicle Wrap
4. Get more customers. Once you have a few customers that like what you have to offer, enlist them to help you. This is known as acquiring customers by referral. Most happy customers will gladly tell others about you, but most of the time they will not think about it unless you give them a reason or incentive. If you find ways to reward or recognize your customers for sending you new customers, they will do so more frequently and with greater zeal.
* Give them a reward for each referral.
* Praise or otherwise recognize their help.
* Provide incentives for them to continue referring others.
5. Keep your customers. A customer is like a prized possession. Do not forget about your customers. Everyone loves attention and has a need to know that others care about them. There are many ways to keep in touch with your customers.
* Mail A Newsletter
* Fax A Brochure
* Use email to communicate
* Use the telephone
* Remember their birthday
* Send them holiday cards (especially offbeat holidays like Thanksgiving)
* Operating a successful small business always means that the business owner spends much or all of his efforts working on the business rather than in it. Learn about marketing by reading books, attending seminars, watching videos and so forth. There is an amazing amount of information available at no cost. Consider subscribing to some marketing newsletters. Read those that actually give you something rather than sell you something.
* If you want your small business to succeed, you simply must spend a portion of your time marketing your business. Successful entrepreneurs agree that working ON your business is the most important work you can do.
While there is a great deal of marketing information for sale, be choosy. Research the author of anything your are getting ready to pay hard to come by money to. Many will promise you riches, but only a few deliver really useful information.
2. Customers are the focal point of your business. Who are they? What motivates them? Are they rich or poor? Educated or not? Where are they? Create a mental image of a customer you would like to serve and use this image when you are creating marketing campaigns. Make sure that you direct you message to this customer and not to some general population. Really try to connect with people.
3. Attract new customers. There are many ways to do this. Depending on who your customer is, some methods will work better than others. Once you understand who your customer is you will better be able to identify where he is to be found. The better you can focus and direct your marketing efforts to those people most likely to actually pay for what you do the better it will work. Some different media that may be useful to you:
* Direct Mail
* Newspaper and Magazine
* Yellow Pages
* Signs and Billboards
* Website
* Pay Per Click
* Vehicle Wrap
4. Get more customers. Once you have a few customers that like what you have to offer, enlist them to help you. This is known as acquiring customers by referral. Most happy customers will gladly tell others about you, but most of the time they will not think about it unless you give them a reason or incentive. If you find ways to reward or recognize your customers for sending you new customers, they will do so more frequently and with greater zeal.
* Give them a reward for each referral.
* Praise or otherwise recognize their help.
* Provide incentives for them to continue referring others.
5. Keep your customers. A customer is like a prized possession. Do not forget about your customers. Everyone loves attention and has a need to know that others care about them. There are many ways to keep in touch with your customers.
* Mail A Newsletter
* Fax A Brochure
* Use email to communicate
* Use the telephone
* Remember their birthday
* Send them holiday cards (especially offbeat holidays like Thanksgiving)
* Operating a successful small business always means that the business owner spends much or all of his efforts working on the business rather than in it. Learn about marketing by reading books, attending seminars, watching videos and so forth. There is an amazing amount of information available at no cost. Consider subscribing to some marketing newsletters. Read those that actually give you something rather than sell you something.
* If you want your small business to succeed, you simply must spend a portion of your time marketing your business. Successful entrepreneurs agree that working ON your business is the most important work you can do.
While there is a great deal of marketing information for sale, be choosy. Research the author of anything your are getting ready to pay hard to come by money to. Many will promise you riches, but only a few deliver really useful information.
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