Young Entrepreneurs: It's Never Too Soon to Prepare to Fund Your Business

Young people who want to start a business someday should be aware that they most likely will need to seek outside funding to make their dream a reality. Whether in college, high school or younger, it is never too soon to begin preparing to approach a lender for startup funding.

One way to start preparing, even at an early age, is to start saving money for the future business. Many clients I work with, no matter their age, do not realize the lender typically expects them to have at least 25 percent of the money needed for startup. So for a $100,000 startup, this would be $25,000.

It takes time and discipline to accumulate the money needed.

Small business lenders look for borrowers with a good record of debt repayment. This is not just about whether there are late or missed payments. Having no credit record at all can also keep you from getting the loan. You need to start as soon as possible to develop excellent credit.

First, educate yourself concerning how credit works. Reputable nonprofit agencies exist to educate consumers about this, and resources are available through high schools and colleges.

As soon as feasible, obtain a credit card in your name and begin responsibly using it and making payments. Be careful that you have the ability to pay it back and that you pay on time. You might take out a small bank loan and pay it back. Monitor your credit report regularly to be sure it is accurate. Know your credit score.

Lenders require collateral for small business loans, and real estate is preferred. Depending on what age you are when you actually start your business you may not have achieved home ownership. So you may need a cosigner for the loan or you may have to seek other sources of funding such as an investor.

When evaluating a loan request, lenders place a lot of emphasis on the experience and ability of the proposed business’s management. You must demonstrate you know what you are doing. Small business owners need an understanding of all aspects of running their business, whether it is record keeping, using financial statements, marketing, finance or hiring, managing and training personnel.

So start now to educate yourself concerning business management and operation.

This could be anything from reading books on business startup and management to taking classes available from local nonprofit organizations and colleges. You also may join business clubs and organizations. There are online classes, articles and blogs.

Many high schools and even middle schools have activities and programs to help students prepare for successful business ownership.

And you not only need to understand the fundamentals of managing and operating a business; you should be continually learning, networking and observing current events, maintaining awareness of changes and trends in the economy and your proposed industry.

Although it is not required for success, you may, if you wish, eventually obtain a degree in small business management.

Take advantage of other resources available to help you learn how to be a successful entrepreneur. Numerous programs encourage and foster youth entrepreneurship.

There are also nonprofit and government sources of information, classes and consulting such as SCORE, SBDC and centers for entrepreneurship.

Gaining actual experience in the real business world is crucial. Find a job working in the type of business you are seeking to start and learn everything you can about the business’s operation and management.

This experience may lead you to change your mind about what type of business you want to own, but it is best to find this out as early as possible so you can redirect your efforts. Some high schools and colleges offer apprenticeship and internship programs to help you gain experience.

A critical part of your efforts to prepare for funding and starting your business is to find a mentor who can guide you on your entrepreneurial journey. Seek an older, experienced, successful business person who is willing to share their wisdom and expertise with you.

Then listen.

Connie Edwards is business consultant for the University of Georgia Small Business Development Center in Savannah. Contact her at 912-651-3200 or cedwards@georgiasbdc.org.

Edwards, Connie (2013, March 20). Young entrepreneurs: It's never too soon to prepare to fund your business. Business in Savannah. Retrieved from http://businessinsavannah.com/bis/2013-03-18/young-entrepreneurs-its-never-too-soon-prepare-fund-your-business#.UVnZK5OG1jQ

How Your Business Can Benefit From EgoPay

In today’s global economy customers are able to buy products from virtually anywhere in the world. Make it easier for your customers to buy from you no matter where they are by offering EgoPay to accept payments online.

EgoPay is an electronic currency. Customers can open a free EgoPay account and purchase e-currency to use at a variety of participating retailers. This process has the advantage of creating a single, uniform currency that is used throughout the internet.

EgoPay offers a variety of attractive options for consumers such as the EgoPay e-wallet. Customers can have as many wallets as they want for greater control over budgeting, expenses and purchase tracking.

Customers love EgoPay because it saves them time. They don’t have to deal with converting currencies or looking up exchange rates. They aren’t hit with any surprise conversion or transaction fees. Instead, they can deal directly with the EgoPay payment system and let EgoPay do the work for them. This allows them to enjoy a stress-free shopping experience, ensuring that they’ll keep coming back for more.

Offering EgoPay on your website is easy. Retailers can open an online merchant account to begin accepting EgoPay payments for free.  Just go to www.egopay.com and fill out the required information to start offering EgoPay to your customers.

EgoPay protects both the consumer and the retailer by offering a safe environment for transactions. By using an e-currency, you know that customers have the funds to purchase the products they order from you. You can ship orders with confidence, knowing that the money is already waiting for you at EgoPay.

Transactions are instant and there is no waiting for funds to clear. Customers from other countries can instantly make a purchase from your store without waiting for banks to exchange currencies or for the funds to be processed.  This feature is especially valuable for small businesses and individual sellers.

If you ever have a problem with EgoPay, our customer service team is available 24/7 to help answer any questions you may have. Unlike banks that are only open certain hours and on certain days, EgoPay’s team is available whenever you are. Contact them when it’s convenient for you and enjoy high-quality service on your schedule.

When it’s time to withdraw your earnings, EgoPay offers a variety of payment options to choose from. You can withdraw your funds to Payza or another verified exchanger. You can find a list of verified exchangers at https://www.egopay.com/exchangers.html. Withdrawals take up to 2 days to process.

Using EgoPay is convenient for businesses and customers alike. EgoPay is safe, easy-to-use and fast. Sign up today at www.egopay.com and enjoy the benefits of online currency!

https://www.egopay.com

Want a more durable business? Look at your revenue quality.

Often one of the priorities for business owners is a focus on quality. Quality is measured and analyzed in products, customer service and employees. While it’s important to focus on the quality of operational inputs and outputs, it’s also important to think of quality of revenue.

Revenue quality is a description of revenue sustainability. Sustainable revenue is a great thing because it makes a business more durable by positioning it to more easily weather difficult external circumstances such as an economic downturn.

Revenue quality is made up of many different factors. Some of these factors include how likely it is that the revenue sources will continue in the future, how lucrative the revenue sources are, how varied the revenue sources are, whether the revenue is causally related to a competitive advantage, how costly it is for customers to choose alternatives to the offerings producing the revenue and how little marketing spending is required to produce the revenue.

The more of these characteristics a revenue source exhibits, the higher quality (and more sustainable) it is.

Higher quality revenue is revenue that is likely to recur. What percentage of your revenue comes from repeat customers? How many of your customers from this year were also your customers from last year?

The higher the percentage of recurring revenue, the more predictable your future revenue is. Remember how you keep hearing how important it is to keep track of your customers’ information? It’s not just for marketing purposes. Knowing who your customers are and their purchasing history is necessary to quantify recurring revenue and more accurately predict future revenue.

Higher quality revenue involves sources that contribute higher profit margins. Many businesses have more than one revenue source and each source has its own margin. How high are the gross margins on your products and services? Are there significant differences in the margins between your offerings?

Note your higher margin offerings as higher quality revenue sources. Then, focus on increasing your sales in those offerings.

Higher quality revenue is also diverse revenue. Revenue that comes from multiple sources is more stable than revenue that is dependent on a single stream or customer. How concentrated is your customer base? Fragmented customer bases are preferable over concentrated customer bases because they pose less of a risk to your revenue.

It’s like an investment portfolio: diversify to reduce risk.

Revenue that can be directly connected to a business’ competitive advantage is higher quality revenue. Your competitive advantage is a potential competitor’s barrier to entry. A revenue source that is protected by a barrier to entry is more sustainable.

Does your offering that produces the revenue in question lock your customers in some way? Revenue from locked-in customers is higher quality. It’s why there are so many contract and subscription-based revenue models now.

Finally, the less money that has to be spent on marketing an offering to generate sales, the higher quality that revenue source is. Offerings that require a smaller advertising budget are usually successful because of word of mouth.

Customers love the product or service so much they tell their friends. Revenue is generated from a natural demand that gains and sustains its own momentum instead of a constant high spend on advertising.

To increase the quality of revenue, consider which of the above characteristics are lacking and focus on making them more present in your revenue model. Higher quality revenue is more sustainable revenue, and a business with sustainable revenue is more durable and one that is likely to be around longer.

Jason Anderson is director of the Georgia Southern University Small Business Development Center. He can be reached at janderson@georgiasouthern.edu.

Anderson, Jason (2013, February 20). Want a more durable business? Look at your revenue quality. Business in Savannah. Retrieved from http://businessinsavannah.com/bis/2013-02-18/want-more-durable-business-look-your-revenue-quality

The Best Writing Company for Accomplishing Your Essay Assignment

If you are a college student who meets various difficulties when working your essay job, you need to get some help to accomplish your task. Working an essay is not a simple task. Sometime, you also need to spend your time longer for doing some research for your essay. This complexity can be even harder if you also have some side job that takes your time a lot. You surely will find difficulty to share your time for your side job and for your academic assignments. Unless you have a really great writing ability, you likely have smaller chance to finish your essay task properly before the deadline.

Such stressful condition will haunt you, except you obtain a professional assistance to get all your hard academic works done properly and on time. In this part, an online writing service will be your best chance to fix such problem. Online writing service company can create custom essay according to its customer’ order. However, not all writing companies can really meet your requirement. Some of them may provide poor quality service that cannot satisfy you. Therefore, you need to get a company that can really help you to accomplish your essay task.

Essay Titans is an online writing service that you can rely on. Such company ensures the best essay result for any type of essay that you order. It has numerous professional writers who can provide best quality essay of various subjects. It even provides assistance for non-English speaking students to work any kinds of academic task. Plagiarized essay is something that you will not meet at certain company as it assures all essays it works are due to customers’ instructions. And, it can meet your deadline, even if the time you give is really short.  

Planning Essential to New Business Success

If you want to successfully operate your own business, it is critical that you realize how important the planning stage of your business is and are willing to put in the time and effort needed to develop an effective business plan.

Approximately half of new small businesses fail within the first five years. One of the major reasons is lack of planning prior to startup. If you have already started your business, you can still improve your chance for success by developing a plan for the future of your new business.

I have observed that many people starting a business do not identify their target market. This approach is not only ineffective; it is a waste of time, effort and money. You should plan to focus your marketing efforts on those consumers (or businesses) that are most likely to be interested in purchasing your product or service.

First, identify the characteristics that best describe your ideal customer such as age, gender, income level, ethnic group, type of business, size of business, etc. Then tailor your planned marketing efforts to that target market. What are the best ways to get your message to them?

Knowing who your target market is will also help you determine how large your potential market is before you start your business. Are there really enough potential customers in your targeted geographic area to make your plan feasible?

Another important question to answer is what other businesses are targeting these customers. Identify who your competitors are and how you compare to them.

Don’t just look at businesses exactly like yours when identifying the competition. Think of competition as alternatives your potential customers have to buying from you. Compare your business to these alternatives and be able to explain why your potential customers will choose to buy from you instead of the competition.

Take a look at your strengths and weaknesses and those of your management team. Determine ways to shore up the weaknesses and capitalize on the strengths. Look at personnel needs and develop job descriptions for the positions that must be filled. Determine work schedules and pay rates. What education and experience will you require for each position?

Become aware of the legal and tax obligations you will have. This could include requirements on a city, county, state or national level such as business license, name registration, special permits, sales tax, income tax and payroll taxes, to name just a few. You need to seek the advice of an attorney and a Certified Public Accountant (CPA).

It is also important that you become aware of and plan for the costs of complying with these requirements. They can significantly impact the overall cost of starting and operating your business.

Many individuals starting a business significantly underestimate their overall cost. Take time to do thorough research so that you do not overlook or underestimate any startup costs. Look at not only what it will cost to get your business open, but also how much money you need to have on hand when you open to keep your business afloat until it can sustain itself.

Estimate potential sales and expenses to develop a projected income statement for your business. You also need to do a projected cash flow statement. These projections should be done for at least the first two years, with at least the first year done on a monthly basis.

Starting your business can be a dream come true, but it is a risky step to take. However, as discussed above, you can take steps that will improve your chance for success.

One effective way to plan for your startup business, or for a business you recently started, is to participate in SBDC StartSmart. The Georgia SBDC Network is offering this series of classes in Savannah beginning March 5.

SBDC StartSmart provides the resources, tools and support to help you build a successful business. Partial scholarships are available. To apply, contact the Savannah SBDC office at 912-651-3200 or go to our website at www.savannahsbdc.org.

Connie Edwards is business consultant for the University of Georgia Small Business Development Center in Savannah. Contact her at 912-651-3200 or cedwards@georgiasbdc.org.

Edwards, Connie (2013, February 6). Planning essential to new business success. Business in Savannah. Retrieved from http://businessinsavannah.com/bis/2013-02-04/planning-essential-new-business-success

On Your Mark, Get Set, Innovate!

Imagine this scene. A mid-sized company recognizes it is seriously falling behind the competition. New ideas for products and delivery mechanisms have not been forthcoming and sales are dropping rapidly. They are in trouble — big trouble. So the firm’s CEO calls an emergency meeting of the management team. She gives the group the bad news and then exclaims, “We are not going to leave this meeting until we come up with something innovative!”

That sounds pretty silly, right? It’s hard to believe, but I actually participated in a forced innovation session similar to the one just described. As you can imagine, whatever innovative ideas or creativity there had been in the room before quickly flew out the window.

What the CEO did not understand is that innovation is a process not an activity. A culture of innovation must be deliberately nurtured and given time to grow. Most business owners and managers instinctively know creativity and innovation can lead to the transformation of a business.

It takes courage and vision to leave the comfortable methods of the past and step out into something new, but that cannot happen if leaders are not aware of the process necessary to get there.

Teresa Amabile, Edsel Bryant Ford Professor of Business Administration at Harvard Business School, has conducted research into the creative process as it relates to business. She has identified key stages in the innovation and creative process: preparation, incubation, illumination and execution. Recognizing and supporting these stages can help business leaders begin to move toward building a culture of innovation within their firms.

Preparation is the first stage and the one in which an individual or a team dives into a problem. It’s when information gathering occurs. If a team is working together, many times roles are defined for the team members, tasks are assigned or areas of special interest are adopted.

The creative process can stall or appear to be stalled at this stage when ideas bring forth a lot of possibilities but there are no immediate insights into the problem.

The second stage is incubation. Sometimes it looks like the problem has been forgotten or is on the back burner when, in fact, it is not. People are thinking it over, writing down ideas on cocktail napkins, having ideas occur to them while focusing on other tasks.

Illumination is the third stage. This occurs when the mind has had enough time to come up with that “aha” moment. Teams feel the need to reform because the problem has gelled and a spontaneous interchange of thoughts can bring forth an idea that no one could articulate alone.

The fourth and final stage is execution. This one separates creativity from successful innovation. It requires action, persistence and the ability to create change coalitions while marketing the idea to skeptical people. This is when leadership can be of most support.

For business leaders who wish to promote a culture of innovation, understanding the creative process is not enough. They should provide the most prolific innovators with extra resources if they need them, eliminate processes or policies that get in the way of information gathering, allow the innovators time to play around with the ideas they come up with and commit to drive the best ideas through to implementation.

As I mentioned earlier, it takes courage to move an organization from the familiar to the unfamiliar. The creative process, once understood, can help business leaders move their firms to a new level of innovation and competitiveness.

That understanding coupled with the commitment to support it through to execution is the key to breakthrough business practices.

Suzanne Barnett is the south Georgia director of the University of Georgia Small Business Development Center.

Barnett, Suzanne (2013, January 23). On your mar, get set, innovate!. Business in Savannah. Retrieved from http://businessinsavannah.com/bis/2013-01-21/your-mark-get-set-innovate

Emergency Preparedness: Is Your Small Business Ready?

The American Red Cross states the supply of groceries present in local stores in some communities will satisfy about a three-day supply to the local population. Three days. And in the case of a catastrophic event, most of those supplies will be depleted within one day due to panic buying.

Should you have to survive for two weeks without a re-supply, how will you and your family live? How will your staff and their families live? What if your electrical power is out for days/ weeks? With gas pumps and ATM machines dependent on electricity to operate, will you have enough gas reserves to fill your car’s tank? Do you have enough cash in reserve to buy essentials?

Blackouts, brownouts, tornados, hurricanes, ice storms, terrorist incidents. ... Each of these events can have a devastating effect on the way in which we live our lives and for the continuity of your business. Though preparation will not eliminate the stress or potential for injury or death, it can help mitigate the effects. And being prepared means having a plan, in this case an emergency plan.

An emergency plan will guide you and your staff on how best to handle the challenges of an unexpected threat to you, your staff, your business, and your customers. The plan can be thought of as existing in two phases: The tactical or immediate threat plan and the continuity plan.

The goal in the tactical period is to minimize injury and death. The experiences of those in the World Trade Centers demonstrate that having a plan can save lives. Thousands were saved because certain individuals had stressed the importance of an evacuation plan and had practiced the plan.

In order to minimize injury, your goal as a business owner is to remove yourself and anyone in harm’s way to a safe location, a rally point. At the rally point, a role call can be taken to identify who is present and who is missing. At the same time, individuals who are not present in the office must be notified, if possible, and alerted to what is going in the office.

A plan needs to be developed, it needs to be written, a copy needs to be available to each of your staff and the plan needs to be practiced.

Once the immediate threat has passed, one must have a plan to assist in the recovery phase and to ensure that critical data, necessary for rebuilding your business, has been saved. The goal in the continuity phase is to minimize downtime as well as to provide a recovery strategy, including a repository of important recovery information.

In developing the continuity plan, one begins by focusing on collecting information that will help in recovery: i.e. employee contact information (including family contact information and medical history), vendor and supplier information and key contacts/ customer information.

The continuity plan should include contacting your vendors and determining what their plans are regarding a catastrophic event. Consider setting up alternative suppliers for those key items necessary to keep your business running.

Let your key customers know your business has a continuity plan and explain how they can reach you should an emergency occur. Assure them you are preparing now to continue to supply the products or services they would need. Consider setting up a recovery location in the case your business location is no longer able to be used. If possible, identify a site outside the local power grid, which would be accessible in the case of major wind damage.

Make a record of those items and personnel necessary to get your recovery site up and going. The quicker and more efficiently you are able to get your business operational the better able you will be to satisfy your customers’ needs during a difficult time.

The first thought you and your staff will have is probably related to the safety of your families. A significant reduction in staff should be anticipated in the early period after the event. Plan for that reduction. Only after one’s family safety has been assured can one effectively begin looking toward rebuilding the business.

To prepare for this eventuality, you can encourage your staff to develop their personal emergency plan. For your staff to see it as a priority, you must see it as a priority. You must lead the way in your organization to develop your own plan: Building an emergency kit for your family, developing a communication plan, and staying informed.

The more prepared you feel your family is to handle an emergency, the better able you will be to focus on taking care of those around you and helping your business get back up and running.

Developing an emergency plan should be considered a critical element in the operation of your business. Though not something you will use everyday, the plan is something that needs to be practiced ... and practiced.

When the time comes, you and your staff need to respond immediately.

For additional information, go to www.ready.gov or contact your local Small Business Development Center (SBDC) consultant.

Mark R. Lupo is area director of the Columbus SBDC and may be contacted at mlupo@georgiasbdc.org.

Lupo, Mark (2013, January 8). Emergency preparedness: Is your business ready?. Business in Savannah. Retrieved from http://businessinsavannah.com/bis/2013-01-08/emergency-preparedness-your-small-business-ready