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Get Your Business Structure Fit For 2012
Jan 17th
With every New Year comes a slew of resolutions? Eat better, eat less, join a gym, actually go to the gym, quit smoking. While well-intentioned Americans focus on getting more physically fit, how fit is your business when it comes to its legal business structure? Have you been avoiding the question for years?
After all, as business owners, there are countless others things to focus on – keeping customers happy, finding new customers, entering new markets to name a few. Or maybe you formed one business structure years ago, but what may have worked for your business during its first few years of existence may not be optimal for you now.
To help you assess what’s right for your business, here’s a run-down of the most common business structures in the United States. As expected, there can be significant tax implications involved and it’s always best to seek the advice of an accountant or tax advisor to determine what’s best for your business.
Sole Proprietor
The most basic of all business legal structures is the sole proprietorship; there’s no corporation or limited liability status. As the owner of the business, you represent the company legally and fully – and are open to unlimited liability for any acts on behalf of your business. A sole proprietor is taxed as an individual (and fills out the Schedule C on his/her personal tax returns). There are no steps involved in forming a Sole Proprietor; if you’ve started a business alone and have not filed for LLC or Corp status, then you’re a Sole Proprietor.
Bottom Line: Considering we live in such a litigious society (and how easy it is to form an LLC), there’s virtually no reason to stay a Sole Proprietor. If you’re operating as a Sole Proprietor, you should consider forming an LLC in 2012.
The LLC (Limited Liability Company)
Owners of an LLC enjoy limited liability, which protects their personal assets from judgments and other obligations of the entity. If the LLC incurs debts or liabilities, the creditors are limited to the assets of the LLC.
An LLC requires fewer corporate formalities, such as regular meetings of a board of directors and an annual meeting of shareholders, than either an S or C-Corporation. An LLC does, however, require proper filing of Articles of Organization with the Secretary of State to be formed and the members of the LLC are required to enter into an Operating Agreement that governs how the LLC will be operated.
The LLC features pass-through tax treatment. If you’re a single member LLC, you will be taxed as an individual using the Schedule C form, unless you choose to be taxed as a corporation. Likewise, a multi-member LLC will be taxed as a partnership with the K-1 form.
Bottom Line: The LLC is great for a business that wants liability protection, but seeks minimal formality. It’s also the perfect structure for a business with foreign owners since anyone (C Corp, S Corp, another LLC, a trust, or an estate) can be an owner of an LLC.
The C Corporation
The C Corporation is the most common form of corporate entity. The C Corporation is owned by shareholders; shareholders elect a board of directors to create and direct the high-level policies of the business. There is no limit on the number of shareholders in a C Corporation. With a C Corp, your personal liability is only up to the amount of your investment.
A C Corp is a separately taxable entity, meaning that it must file its own tax return and pay corporate taxes on its profits. And if the company earns a profit and decides to divide the excess cash among the owners/shareholders in the form of dividends, the earnings are taxed twice: first when the company pays taxes on its earning and then second, when shareholders are taxed on received dividends. Of course, if the company chooses to re-invest its profits back in the company, this double taxation is a non-issue.
Bottom Line: Because of ‘double taxation” and added complexity, the C Corporation is not recommended for small business owners. The C Corp is ideal for a business that intends to raise capital by issuing stock or attracting investors through VC funding. If you have an LLC and are considering bringing in outside investors in 2012 or down the road, you’ll need to switch your LLC to a C Corporation first.
The S Corporation
The S Corporation starts off as a C Corporation, but an S Corp makes an election to be taxed as a “pass-through entity” under subchapter S of the Internal Revenue Code. This means that an S Corporation is not taxed separately from its owners/shareholders. Instead, corporate profits and losses are “passed-through” and reported on the personal income tax returns of the shareholders, much like a partnership.
Bottom Line: The S Corporation is great for the small business owner who can qualify. The IRS places limits on the number of owners and who can be an owner in an S Corporation. For example, owners of an S Corp must be U.S. citizens. And an S Corp can have no more than 100 shareholders.
Plus, all owners are taxed strictly based on their percentage of ownership; if you need more flexibility when it comes to ownership, profits, and taxes, the LLC is a better choice. In addition, the IRS only allows S Corporations to issue one class of stock ? so if you plan on finding an angel investor, VC funding, or go public, a C Corporation is better.
Get started in the New Year
With the new calendar year, it’s a great time to get your legal structure squared away and your business will be set for years to come. Don’t let daily interruptions keep you from doing something that is fundamentally crucial to your business’ long-term health and to the security of your finances.
Fitness Photo via Shutterstock
Get Your Business Structure Fit For 2012
View full post on Small Business News, Tips, Advice – Small Business Trends
Top 5 Microbusiness Opportunities for 2012
Jan 7th
Believe it or not, the economy is slowly getting better. I’ll grant you, the last two calendar quarters for which we have numbers (2nd and 3rd quarters, 2011) have seen pretty sluggish growth but it was growth nonetheless.
Meanwhile, the NFIB reports two consecutive months of improved (if still pretty low) Small Business Optimism Indices, the National Association of Home Builders notes a positive trend in multifamily housing construction that bodes well for the near future, and the National Retail Federation tracked better-than-expected consumer spending during the holiday shopping season (see below).
It is during times like this that the world seems wide open to the would-be business owner who is paying attention and has the kind of vision that can see next year’s opportunities embedded in this year’s chaos. The trick is to find the opportunities that are not going to turn into bandwagons for everybody to jump onto by February.
So, in case you’re having trouble kick-starting your own version of vision, here are a few of the kinds of ideas you probably won’t find in everybody’s tweets and headlines and blog posts to get your creative juices flowing:
Indie Skill Builder (Coach) and other labor-market related consulting gigs: If you caught the brief exchange between myself and Emergent’s Steve King in last month’s Research Roundup, you’ll know that we’re probably in the midst of a labor market shift that is will leave us with a 50-50 split between the traditionally employed and the “contingent workforce” — composed of temps, part timers and freelancers/independent contractors.
But being a freelancer requires a certain very specific skill set that is quite different from the skill set needed by the traditional employee. Enter a new set of business coaches to fill that gap, particularly for those unfortunate college grads who are not finding employment in the traditional zone. Plenty of work, with this shift taking at least a decade to get where it’s going.
Inventive Inventions and Innovations: While everybody speculates on the future of Facebook and plays with the ever-expanding features of their smart phones, there’s a certain kind of anticipation in the wind. Everybody — particularly venture capital investors — is waiting for the Next Big Thing and hoping fervently that they are able to recognize it when they see it. Of course, inventions of the sort that we’re talking here — stuff like Velcro, Spandex and Teflon — require certain technical skills but if you have those, you’re golden.
Are you thinking I’m kidding with my examples? I’m not. Take a look around your house and see how many examples you find of one, two or all three substances in the things you own. The investors of those homely substances have made a bucket of money in a decidedly low-tech way. (While you’re at it, consider the investor of the humble Post-It note.) This is not an “easy” opportunity; inventions and patents and all that jazz can be a legal minefield full of corporate greed and intrigue. But, for the creative and intrepid, the rewards can be fantastic.
Manufacturing Consultancies (logistics, technology updates, etc.): I would not have expected to see myself writing this under any circumstances but it looks like the manufacturing sector has been showing signs of life for some time now. But, with economic growth continuing to be sluggish, manufacturing plants are going to have to achieve new heights of efficiency if they want to thrive during lean times.
Any service sector firm that can help with that effort — whether they know logistics or work flows or technologies or anything else along these lines — should be able to make a strong case for their services. A bit of salesmanship is going to be needed here — your services won’t just sell themselves in this economy — but the times might allow for the development of a nicely-sized client list that can keep you busy and paying the bills in 2012.
Wholesale Traders: Another surprise in the numbers comes in the form of personal consumption expenditures. The year-end consumer spending season turned out to be better than anticipated — at least by the National Retail Federation, which upped its estimated increase in holiday retail sales from 2.8% to 3.8% just ten days before Christmas Day.
With consumers in a better mood these days while private inventory investment posts discouraging numbers, the writing for a slow and steady release in pent-up demand seems likely to be on the wall. But, in the consumer world, microbusinesses stand to do better in the wholesale end of things rather than having to compete with the Walmarts of the world in the retail space.
High End Personal Services: Occupy Wall Street might lament the Gordon Geckos of the world and the progressives among us might sound alarm bells about income inequality but, in the meantime, it all translates into much largess for the microbusiness owner who can come up with a suite of personal services for them-that’s-got (in the words of the immortal Billie Holiday). The nice thing about this for said microbusiness owner is that it would in this case be a fairly simple matter to design a business around something you genuinely like to do.
If you are a pet masseuse or a people groomer or have the skill to make anything else look or feel good, then you can find ways to market those services to the kind of clients with enough money to pamper themselves, their pets, their palates, their cars, their crabgrass and their contours even in times like these.
There’s enough here to start your creative juices flowing and your enterprising eye looking for your very own niche. Meanwhile, here’s hoping you have a happy, healthy and prosperous new year.
Micro Business Photo via Shutterstock
Top 5 Microbusiness Opportunities for 2012
View full post on Small Business News, Tips, Advice – Small Business Trends
4 Ways to Boost Your Green Business Efforts in 2012
Jan 6th
It’s that time of year when everyone is making New Year resolutions to improve their lives in the months ahead, from health to relationships to finances. Another worthy consideration is how to make your business (and life in general) eco- friendlier in the year ahead.
Last month, I featured some green business trends, such as eco-packaging and nonprofits helping businesses with sustainability, which might offer some inspiration. But here are four steps to getting your green business initiatives off to a strong start:
1. Write an annual sustainability plan. Writing down plans, like hashing out a budget, helps you define your goals and better determine how you’ll achieve them. It’s also demonstrates to your customers your commitment to reducing your environmental footprint. It doesn’t have to be 100 pages, or even 10 pages. But it forces you to think in detail about your green goals and can help motivate you to get started. Review the plan at least once or twice throughout the year to see whether you’re on track to fulfilling it. Read more about sustainability planning.
2. Prioritize your goals. As they say, don’t bite off more than you can chew. You realistically may only have time to concentrate on one main goal for the year on top of everything else you do. Decide what that goal should be – whether it’s installing energy-efficient lighting, moving to a paperless system or conserving water. Whatever that goal is, break it into sma steps in your sustainability plan to make it more attainable and make sure you’ll realistically have the time and money set aside to achieving it.
3. Utilize free help. A growing number of nonprofits, Web sites and even smartphone apps have cropped up to help businesses achieve their green initiatives. Don’t turn away free help – embrace it. Consider joining a local business networking group devoted to green practices. Also check into services offered from your city or gas and electric utility, if you haven’t already. Many offer free energy audits and other environmental-related services.
4. Offer your customers a role. Your sustainability efforts are a natural place to involve your customers and can even engender more loyalty. Make this the year that you take your green initiatives to the next level by better engaging your customers– whether it’s through recycling or donating a small share of your profits to a good cause. Little measures can go a long way to building a better reputation as an eco-friendly firm.
Did you include sustainability in your business plans for 2012? What’s your top green resolution?
Sustainability Photo via Shutterstock
4 Ways to Boost Your Green Business Efforts in 2012
View full post on Small Business News, Tips, Advice – Small Business Trends
10 Social Media Resolutions for 2012
Jan 4th
The 2012 business year officially starts today. With the mini-breaks and shortened weeks gone, all that’s left to do is tackle that To-Do list that’s twice the length of your arm once and for all. If you need help figuring out where to start or what habits to pick up in social media this year, below are 10 social media resolutions every small business owner would be smart to make.
We’ll start slow.
1. Claim everything: Your brand is your identity in business. If you haven’t already taken the steps to protect it and claim your username throughout the Web, start the year off by doing just that. Knowem is a fantastic service that allows you to easily search and claim more than 550 popular social networking sites at little cost. Even if you don’t plan on using all 500 (or even five) of these sites, protecting your username will ensure that you’re able to use them in the future should you change your mind AND that no one else can hijack your brand’s identity and speak to your customers. It’s your first step to social media success.
2. Pick two social media sites and focus on them: Just because Knowem allows you to claim more than 500 social media profiles, doesn’t mean you have to use all of them. Instead, focus on 2-3 social media sites, sites where you know your audience is and that may already be delivering traffic, and really invest in devoting time there. For example, maybe you’ve found that you get a lot of traffic from Yelp. Why not invest more in that site by optimizing your Yelp profile, using their analytics, and taking advantage of their specials? Instead of worrying about being everywhere, focus on developing a strong presence where it counts for your business. Once you get the hang of those first two sites, you can spread your wings to some of the others.
3. Build ears: Before you really engage, work on building your ears. Listening in social media will help you identify the people you want to be talking to, the conversations worth your time, and may just prevent you from royally putting your foot in your mouth. If you need help, iGoogle can help you build a free social media dashboard or check out a service like Trackur which has cost-effective plans to help SMBs stay in the loop.
4. Agree to schedule social media into your day: If 2012 is the year you’re finally going to get serious about social media, then you really need to get serious about it. And you do that by scheduling social media into your day the same way you schedule all of your other tasks. Because that’s the only way it’s going to get done. Find a way to dedicate 30 minutes a day into updating Twitter, responding to people on Facebook or commenting on industry blogs. If you don’t schedule it, you won’t do it. It’s as simple as that.
5. Increase your online reviews: When I broke down my 5 Internet Marketing Trends for SMBs to Watch in 2012, I talked about online reviews as becoming an increasingly important social signal for the search engines. The engines are looking at reviews to help bring accountability back to the Web and, frankly, so are users. Creating a full-on online review strategy may sound intimidating, but all it really means is is encouraging your customers to talk about their experiences on the sites you want them to do the talking on. That’s nothing to be shy over. Use your Web site, your emails, your newsletter, you advertisements, and your face-to-face interactions to help them do that.
6. Blog more: Hey, I know. Sometimes it can be hard to find the time or the motivation to blog. We’ve already helped spark some blogging inspiration, now it’s time for you to dedicate the time to doing it. Even if you’re just blogging a couple times a week, it’s going to help you build a community, have something to always share with your audience, and help you in search. If you’ve been putting it off or not blogging as often as you should, 2012 is the year to fix that.
7. Read other blogs: A great way to always have something to say and blog about it is to keep up with what others are saying. Use Twitter or Google Blog Search to help you identify authoritative (or at least interesting) blogs in your space that you can use as conversation starters and as a way to stay up to date on what’s happening in your corner of the world.
8. Attend a tweetup: Do something crazy this year and leave your office. Go find out where people who do what you do are meeting and join them. Talk to them. Share with them. Online interaction can only go so far before you have to take it offline.
9. Find ways to reward fans with social media exclusives: It’s not enough to simply BE in social media. You have find ways to reward fans and give them “the why” for why it is they should like you, follow you, talk to you. Fifty-eight percent of users expect exclusive content or discounts for “liking” a brand on Facebook. That’s pretty significant. So if you’re not using your social media presence to reward customers for their interaction with you, you’re letting them down.
10. Promote your social media accounts: Have you read the nine previous resolutions? There’s some work involved there. And if you’re going to be putting in the blood, sweat and tears needed to create a powerful social presence, then you darn well better be promoting these accounts at every turn. That means making them visible on your Web site, putting their logos on your customer receipts, highlighting them in your email newsletters and on business cards, and linking to them wherever you can. Don’t hide your social media. Flaunt it.
Above are ten social media resolutions I think all SMBs would be smart to make this year. What’s your biggest social media goal for 2012? How are you making it happen?
10 Social Media Resolutions for 2012
View full post on Small Business News, Tips, Advice – Small Business Trends
5 Website Resolutions to Put on Your List for 2012
Jan 3rd
We’re in the New Year and the time for making resolutions about health, wealth, family and oddball bucket lists. Don’t forget about making resolutions about your online presence as well. Your website 2012 resolutions should include content, communications, community, conversations and conversion. The secret of successful small business owners is that they spend more time “on the business” than “in the business.” One of the tools for spending on your business is your web presence.
Small businesses are great at customer service and realize that their next customer will come from a current customer – Word of Mouth. In the digital world word of mouth is “word of mouse” a powerful tool to gain new customers. A new era of marketing is unfolding and digital marketing helps you in your objective to influence behavior to change positively towards you. The audience who need your product and services are increasingly searching for them online. It is interesting to see how the communication tools are coming together.
We hope you are convinced that even your brick and mortar business needs to be on the web. Guess what - “92% of online adults use search engines to find information on the Web” according to a May 2011 Pew Internet Survey (PDF).
Without further adieu, here are some 2012 resolutions you should include in your business list. Five “C” online resolutions for small business:
Content
- Not having a website for your business is not an option anymore. A website or a blog all count as establishing your web presence.
- Resolve to update it constantly. Once a day, week or even a month as long as you are consistent.
- Show your thought leadership through content. Publish your thoughts on your industry, peers, products, good news about your community.
- Education through content – provide tips to your customers, answer the most asked questions on your website or blog.
- Fresh and updated content is a good way to ensure search engines are indexing your site often and your chances of appearing in search results will be better.
Communications
- Email Marketing is still a top performing marketing channel for businesses. Embrace it and use it to flourish.
- It is important for you to get email branded with your business name showing consistency and credibility.
- Communicate with your customers to solve their problems with your product rather than selling your product.
- If you are sending an email newsletter you should try to use software like Constant Contact, Exact Target, MailChimp or other professional tools. Many of these tools make it easy for you and also guide you to succeed in email marketing.
- Food trucks use this medium very well to let customers know their location.
- Last minute availability of appointments at doctors, saloons.
Community
- Every business should nurture their customer communities by providing them with tools to spread word of mouth.
- Customer appreciation days
- Special offers for regular customers
- Formal or informal meetings with customer advisory boards
- Asking customers for ideas to improve products or suggest new product features
- Provide easy ways to give you feedback or review your business
- Attend local events
- Business networking and educational events
- Set aside time and budget to attend and learn ways to increase your business
Cutting edge Technology
- While investing in technology evaluate the benefit to your organization and avoid any impulse buys.
- Upgrade your Internet speeds if you feel it will increase the speed of your customer transactions.
- Get a new smartphone if you are away from your computer a lot and your business depends on emails and orders from customers through the web.
- Invest in a tablet if you would like to carry an electronic portfolio to show customers.
Conversion: All your resolutions should lead to your objective of growing your business.
- Make sure you spend your time on activities that help your business grow.
- Social tools can be distracting. Consider them as communication tools and allot enough time to nurture your communities there.
- While only talking about sales in a social context is sometimes in poor taste, look for opportunities where you answer peoples questions and offer to help.
- Definitely use analytics programs to see where your traffic is coming from and which keywords they are using to find your business online.
- If you are a brick and mortar business like a restaurant, try to ask your customers where they found you.
Remember you don’t have to do all these tasks yourself. Weigh the time you would spend with the cost of hiring people to tell your story and concentrate on what you do best – working on your business. What did you add to your New Year business resolution?
New Year Resolutions List Photo via Shutterstock
5 Website Resolutions to Put on Your List for 2012
View full post on Small Business News, Tips, Advice – Small Business Trends
20 Content Marketing Ideas for 2012
Dec 29th
I know–just the phrase “content marketing” is enough to instill fear in many small business owners. But why? As SMBs, we’re pros at using content as a way to attract customers and build word of mouth. We’ve been doing it our whole entrepreneurial careers! But we seem to forget this when the “content marketing” term is brought into the discussion. However, the idea of leveraging content marketing as a lead generation strategy doesn’t have to intimidate you. There are virtually an endless supply of content marketing strategies at SMBs’ fingertips.
Here, I’ll start you off with 20.
Below is just a handful (OK, a few handfuls) of content marketing ideas your business can implement and profit from in 2012.
- Create a free course on a topic related to your business and invite people in your neighborhood to attend. For example, if you’re a caterer, maybe it’s how to host the perfect dinner party. If you’re an accountant, maybe it’s on what you need to know before filing your taxes this year. Promote the event using both local print and online resources.
- Send out a direct mailing thanking your customers for their patronage in 2011 and sharing what you hope to bring them in 2012. Make sure you’re top of mind as the New Year hits.
- Compile your 20 best/most trafficked/most commented on blog posts into an ebook and offer them as a free download.
- Participate in industry-specific Q&A sites and help solve others problems. Don’t promote your business, but do include a link to your website in your profile so people can find it on their own should they be interested.
- Dedicate 30 minutes a week to commenting on relevant blogs to build relationships, get your name out there and create authority.
- Creating a buying guide related to your industry. If you sell a product, focus on the different specs, installation, uses, etc. If you offer a service, focus on the best questions to ask when evaluating a vendor, the different types of services, etc.
- Start an industry-specific Twitter chat. Invite guests to co-host with you.
- Put together an informative blog series (maybe three posts long) to capture traffic for a competitive keyword phrase show expertise in a particular area. Later, bundle the posts together and turn them into an ebook.
- Create a video interview series where you chat with influential people in your industry or community and post the videos on your website.
- Start an email newsletter.
- Host a weekly Google+ hangout to talk about timely issues and topics.
- Be a guest on a podcast.
- Get other local business owners together and hold a workshop on a hot issue in your industry. Or, get together with other business owners in different industries and talk about how you’ve used the Internet/Facebook/Twitter to increase business.
- Write guest posts for other blogs in your industry.
- Review products/services/books you like.
- Write case studies for your website. Promote them.
- Create a tool to help your community. If you’re a tax preparer, maybe it’s a deduction finder or a planning worksheet. If you’re a social media consultant, maybe it’s a list of Twitter conversation starters for people not sure how to jump in.
- Write a white paper detailing a specific issue affecting your industry, what it means and your take on it. Get other experts to share their opinions as well. Include them in the whitepaper.
- Speak at your local Chamber of Commerce. Create a PowerPoint presentation to go along with it and then post it on your website.
- Start a video grab bag series where you answer common questions on YouTube and post the videos on your blog.
See how easy that was? Twenty powerful ways to use content marketing to build awareness for your business. You don’t even have to break a sweat.
20 Content Marketing Ideas for 2012
View full post on Small Business News, Tips, Advice – Small Business Trends
5 Internet Marketing Predictions for 2012
Dec 29th
When a new year begins, we business owners wonder what’s in store for the upcoming 12 months. After all, with technology moving faster than ever, who could have foreseen the takeover (then falter) of daily deal sites a year ago? Or the ability of Google to take some sites to their knees with Panda? Here’s hoping that 2012 brings nothing but good things to the world of Internet marketing.
Please note: These are my own non-psychic predictions and not the opinions of Small Business Trends or anyone else!
Prediction 1: Daily Deals Will Shake Out. In 2011, everyone with an Internet connection created a daily deal site. And businesses were only too happy to sign up with all of them in an effort to get new clients. But as many retailers realized that they were losing money because they weren’t properly managing their daily deals, many backed off. In 2012, I predict that some smaller players will shut down, while bigger players like Groupon will gobble up some of the moderately successful daily deal sites. We’ll stop being bombarded by 20 emails a day of great deals.
I also predict that we’ll see some innovations in this area. ScoutMob is one such innovator. Many of its deals are 100 percent free, and you don’t have to buy a voucher in advance. Just take your phone with the deal to the location during the deal period, and they’ll give you the discount directly.
Prediction 2: Google + Will Pick Up Some Momentum…But Just a Little. I realize that I can say one of two things: Google + will be wildly successful in 2012 or it won’t. I’m just not seeing the excitement with the tool outside of my circle of people (social media early adopters), so I can’t see Google + hitting anywhere near Facebook’s 800 million users in 2012. I think we’re all still trying to figure out how to use this tool (at least I am). Google’s got to do a better job marketing Google + if it wants some of Facebook’s market share, and thus far, it’s done what it does with all its platforms: put it in beta to make it highly desirable, then sit back and wait for it to become popular.
Prediction 3: We’ll Almost Get There With Mobile. I’ve long been frustrated that Europeans and Asians are so much more phone savvy than we are. They use their phones to pay for things. Why can’t we? (I actually know the answer to this, and it’s a long one that involves banks’ stubbornness to let go of the fees that are involved). But I think we’re getting there, slowly. Google introduced its Wallet platform this year, but you probably haven’t used it.
Mobile coupons picked up the pace this year, as Computer Business Review reports, and it was the first time for me (out in California) that when I handed my phone to a cashier I didn’t get a blank stare. There’s hope yet. I think we’ll see wider adoption of mobile coupons and more effective apps in 2012.
Prediction 4: We’ll Really Latch on to Freemium. With more and more companies offering freemium models of their products (ones with decent but limited capabilities at no charge), I believe (and hope) we’ll see even more of this in 2012. My current favorites? MailChimp, BaseCamp and Evernote. The benefit to the businesses is that even when they offer a free version, a large number of users upgrade to a paid account. Could be a good idea for your business!
Prediction 5: We’ll Nail This Content Thing. We’re so tired of Google Panda and pandalized sites. We know how to create meaningful content. So I think in 2012, we business owners are going to step up the pace on content marketing. We’re going to drive traffic to our sites through articles that answer questions and solve problems. Competition will get fierce, but when it’s not, hey, it simply isn’t fun!
What are your predictions for this year?
Prediction Photo via Shutterstock
5 Internet Marketing Predictions for 2012
View full post on Small Business News, Tips, Advice – Small Business Trends
Will There Be a Shortage of Small Business Tech Workers in 2012?
Dec 28th
Does your small business rely on high-tech workers to compete? You’re not alone. Increasingly, being up to speed on technology is crucial to business success, which means you need a savvy tech team in-house. But hiring those tech workers might be getting harder—and the risks of making a bad hire might have greater ramifications—in 2012.
While national unemployment rates hover near 9 percent, CIO.com reports that as of November, the unemployment rate in the technology industry was just 2.7 percent. Also as of November, the number of job openings rose by 12 percent year-over-year, according to tech hiring site Dice.com. In particular, big cities like New York, Silicon Valley and DC are seeing shortages of qualified tech employees.
For 2012, it’s only going to get worse. CIO says a December survey by Dice.com found that 65 percent of IT hiring managers expect to hire in the first half of 2012, with more than one-fourth planning to increase their IT staff by over 20 percent. Those companies are looking for experienced workers, with the biggest demand being for workers with 6 to 10 years of tech experience and those who are skilled in mobile apps, cloud computing, virtualization, project management, business analytics and Java.
What does it mean to you? First, if you’re looking to hire tech employees, you’re going to face an increasingly competitive marketplace, which will make the ongoing challenge of matching big companies’ perks and pay even tougher. Second, even if you’re not hiring, you’ve got reason to worry, as the demand for experienced techies means your key people could get poached.
To keep them happy, you’ll need to offer competitive pay (or better), challenging work and the chance for career growth.
If your key tech workers get lured away, it could put your business at risk in more ways than one. A separate survey from CareerBuilder’s site Sologig.com, reported in TechRepublic, found that a majority of companies had experienced hiring an IT person who wasn’t a good fit.
More than one-third said such bad hires cost them $50,000 or more. Rushing to hire was the top reason for bad choices, which resulted in everything from lost time and productivity to harmful effects on morale and even client relationships.
Will you be hiring tech workers in 2012? Or are you just hoping to keep the ones you’ve got? Either way, you’d better start strategizing to ensure you don’t end up short on talent and long on headaches.
Tech Engineer Photo via Shutterstock
Will There Be a Shortage of Small Business Tech Workers in 2012?
View full post on Small Business News, Tips, Advice – Small Business Trends
The Top Franchise Trends for 2012
Dec 22nd
There’s certainly no shortage of dynamic concepts to explore in franchising in 2012. Finding opportunities to get into a business of your own is the easy part. Finding a willing financial partner to help you invest in a franchise business is still a bit more challenging.
For example, if you want to get involved in a franchise business that’s focused on renewable energy and maybe even sustainability, no problem; do a Google search of “green franchises.” Maybe you’re comfortable calling on customers and giving sales presentations; there are several opportunities (such as Sandler Training) available for you. Do you like food? (Silly question!) If you’ve always wanted to own your own restaurant, there are hundreds of unique food franchises, such as these gathered by Franchise Direct, to choose from.
Not all franchises require a commercial space; Pillar to Post and Mosquito Squad offer ways to be your own boss without having to negotiate a lease for the business. Another advantage of investing in a home-based franchise is that you can be up and running pretty fast. One more thing: Remember that your customers aren’t going to find you if you’re sitting at home. You’re going to have to do some serious networking. Your networking should always include being on the lookout for strategic referral partners, as John Jantsch suggests.
Some Things Haven’t Changed
In last year’s post on the top franchise trends, I wrote about the fact that small business lenders weren’t all that excited to lend money for franchise startups. As much as I don’t want to start going all negative here, it’s still true today; lenders aren’t lending enough, The New York Times reports, especially to small businesses.
I also wrote about the fact that homes had gone down in value: “Real estate is usually a major part of a franchise candidate’s net worth statement, and that’s now a problem. Home values are low, and in some cases, homes are underwater.” According to Carole Cohen, a Cleveland Realtor who’s really dialed into the market, “Home prices in our area are down 26 to 28 percent.” (Her income took a hit because of the low prices.) Carole works for a family-owned real estate company, but there are real estate franchises, too, as this Red Carpet report points out.
What Has Changed?
The franchise industry’s focus has changed. By “industry,” I really mean only one part of the industry, but it’s a big one: The International Franchise Association, which is an association that promotes franchising.
I’m still trying to decide whether the combination of social media, and the business transparency that tends to be associated with it, has turned the IFA into a more powerful industry force, or not. On one hand, some of the higher-ups from the IFA, like Matt Haller, the Sr. Director of Communications, are starting to get a bit more active on Twitter, and have started to write some blog posts. However, the growth of social media has evened the playing field in the franchise industry; now voices outside of the IFA–independent ones–can be heard loud and clear, too. The industry is changing, and anyone with an Internet connection can watch some of the changes that are happening in real time.
For 2012, the IFA has decided to focus on two areas in 2012; one is nothing new, but the other one…
1. Military Veterans
Veterans who are interested in possibly becoming franchise owners will undoubtedly run across the VetFran program. This program, founded in 1991, features 400-plus IFA member franchisors that offer training, mentoring and financial incentives to veterans interested in small business ownership and/or a career path in franchising. To date, approximately 2,000 veterans have become franchise business owners through this popular program.
I’ve personally assisted with our veterans, and have even been able to help a few of them become franchise owners. Today’s veterans have three things going for them when it comes to operating a franchise business. They are:
- Finely-honed leadership skills
- Personal discipline
- Comfort with technology
I’m all for helping the men and women who’ve made major sacrifices to help us keep our freedom. Thousands of veterans are returning home from our wars, and need jobs and opportunities. For veterans who want to become business owners, franchising is certainly one path that they should look into.
Of course, they’re going to need small business loans in order to start these franchises, and that’s the part that worries me. That’s because a large number of veterans have had several tours of duty. It’s not like they’ve had a chance to build up their nest eggs. Hopefully, banks will come up with some creative loan programs to help veterans get into business for themselves.
2. Pro Athletes
There’s really only one reason that the IFA is courting professional athletes, and it’s pretty obvious; the athletes don’t need small business loans. Can you think of any other reason?
According to the Bureau of Labor Statistics, there were about 16,500 professional athletes and sports competitors who held jobs as of 2008. This includes every sport, including all of the athletes who aren’t ready for prime time yet (that is, the minor leagues).
The thought of having 16,000 wealthy prospective franchise owners eventually searching for business opportunities in the world of franchising is a nice one. After all, what franchise development director wouldn’t want to have a slew of highly qualified candidates like Magic Johnson requesting information about a particular franchise concept?
While I don’t see hundreds of former professional athletes clamoring to become franchisees, if enough of them do, it could be terrific publicity for the franchise industry. I just don’t see it as a game-changer. (That sporting reference was unintentional!)
2012 will be a very important year in franchising. If the U.S. economy continues to struggle, growth will continue to be sparse in the franchise industry. But if things finally do start to turn around, there’s a lot of pent-up demand for the great products and services that franchises provide to both consumers and businesses.
If lenders start making more loans available for people who want to start businesses, there’s a large pool of prospective franchisees sitting in the wings, waiting to take their shot at The American Dream.
The franchise community is ready and waiting to help them do just that.
Franchise Photo via Shutterstock
The Top Franchise Trends for 2012
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Is Your Business Planning to Hire in 2012?
Dec 21st
American Express OPEN recently took a look back at its past 10 years’ worth of Small Business Monitor surveys, with a particular focus on hiring. The resulting new report, Trends in Small Business Hiring: 2002-2011, hones in on business owners’ responses when asked whether they plan to hire new full-time or part-time employees, cut staff, or keep the same staffing levels over the next six months. The survey used a “net hiring score,” subtracting the percent of firms that plan to cut staff from the percent planning to hire.
Here’s some of what they found:
Overall, small business owners tend to “hold the line.” No matter what the economic situation, over the past 10 years the percentage of entrepreneurs who are planning to add employees has consistently surpassed the percentage planning cutbacks. This doesn’t surprise me, as entrepreneurs who work closely with their teams are likely to do everything in their power to avoid layoffs.
The bigger the small business, the more likely it is to hire. Over the 10-year period, companies with 20 or more workers, or sales of $500,000 and up, were consistently more likely to plan to hire than other groups.
That’s also not surprising, but what is more unexpected is that the smallest companies—those with under 10 employees—were far more likely to fall in line with the hiring average. In contrast, companies with 10 to 19 employees have consistently been the most volatile. In Fall 2006, Fall 2007 and again in Fall 2010, their hiring plans fell far below the national average. Why? Perhaps these companies are in the “growth pains” stage of business where it’s often difficult to judge hiring needs.
So what’s the current outlook? In the Fall 2011 survey, 31 percent of business owners surveyed were planning to hire new employees while 9 percent planned to cut back, for a net hiring score of +22. American Express OPEN notes that while regional differences in hiring have lessened since the 2008 recession, industry differences have increased.
The Fall 2011 survey reports a net hiring score of +28 score among small manufacturers, +26 among business/professional service firms, +17 among retailers and +17 in all other firms.
How do small businesses’ hiring plans compare to those of big business? In the most recent Manpower Employment Outlook Survey of global companies, 14 percent of U.S. employers surveyed expected to add staff in the first quarter of 2012, while 9 percent planned to cut, for a Net Employment Outlook of +5 percent (or +9 percent if seasonally adjusted). Some 70 percent planned no change, while 7 percent were uncertain about their hiring plans. This 7 percent was an increase from 3 percent in the last survey and was a historically high level of uncertainty.
What does it all mean? Whether you’re a big business sitting on unprecedented amounts of cash, or a small entrepreneur with far less room for error, employers are still fearful of hiring in this uncertain economy. Still, small business owners are significantly more optimistic about hiring, showing that their reputations as job creators and engines of the economy are well deserved.
Hiring Photo via Shutterstock
Is Your Business Planning to Hire in 2012?
View full post on Small Business News, Tips, Advice – Small Business Trends
