Business Basics: Return on Investment (ROI)

Welcome back to business basics! In case you’ve forgotten, every week we take a look at a basic business concept in order to try to help new business owners better understand it. This week, we are covering Return on Investment, or ROI – a fairly straightforward, but often misunderstood, part of running a business! Though you may think you know all about ROI, you could be using it incorrectly. But first… ROI

What is ROI?

Return on Investment, or ROI, is pretty easy to grasp – heck, the definition is right in the name. It’s whatever return you get after your invest in some part of your business. So if you hire 2 new salespeople, a basic measurement of ROI will be the money they bring in, minus their wages. Continue reading

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ABCs of Small Business Industry: B is for Banking

As we enter week four of our series, we decided to look at a slightly different industry – banking. Now, focusing on banking may seem a bit odd. After all, most people don’t consider banking as something an entrepreneur can even get into. And while there are loads a regulatory loopholes to jump through, plenty of entrepreneurs do start their own bank! And running a bank can be quite lucrative. So if you have experience in the financial industry, and are looking for a change, this could be just the post for you! banking

How do you start a bank?

Like any business, you need to identify a need. Most communities are served by big-name banks like Chase or Bank of America, and people gravitate towards names they recognize. But even if it feels like your community is over saturated with corporate banks, there could be a place for a small, community bank, like if you decide to focus on serving a particular section or area of the community. Some people also like being able to meet face-to-face with a high-level executive to talk about loans or their account – something they’d never be able to do at a corporate bank.

If the market looks good, you then need to work on getting everything organized. Most states require banks to have multiple directors, who then put in an initial offering to get the bank started, usually around 25% of the bank’s starting capital. Since banks need a lot of capital to run, this is usually a substantial amount of money. Most banks sell off shares to raise the rest of their capital.

When your ducks are in a row, you file for a state or federal charter. Filing this form typically costs thousands of dollars, and requires a substantial amount of preparation. You’ll need to include information like feasibility studies, applications for the directors, projected costs, projected salaries – the state or federal government effectively needs to decide whether or not you’ll be successful before granting a charter. After this, you apply for deposit insurance from the FDIC, which requires banks to prove they have enough capital to cover any risk and losses. It will take a few months before the charter application is processed and, once it is approved, you normally have about a year to start the bank officially.

What business structures are best suited for banking?

Because banks are required to have directors, executives, and shareholders, a bank has to be some sort of corporation. However, in some states, a bank is an entity in itself. Though it is run in the same way a standard corporation is.

How stable is the banking industry?

Very. Because banks have to apply for a charter, an outside organization effectively reviews their business plan and target market, and determines whether or not the idea is viable. Banking costs a lot of money, but if you get a charter, you can usually bet that you’ll be successful. The rate at which banks fail has also slowed substantially as the economy has recovered.

Interested in community banking? Have any questions about the banking industry? Leave a comment below, or give us a call at 1-877-692-6772!

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Six Ways to Boost Your Credibility and Close More Deals

Six Ways to Boost Your Credibility and Close More DealsWhen it comes to sales, be a product of the product. If you don’t use the product or service you’re selling, why should your prospect? If you sell Hondas, don’t drive a Jeep. These six strategies will help you build credibility up with prospective customers and clients – and also ensure you make some money in the process for your business.

1. Determine quickly if you really can help.

I recently got a call from a prospective client who wanted help completing interviews. It took me about 2-3 minutes to find out that their budget was too small for me to work with. I politely offered a referral to another firm that might be able to do the job. I didn’t want to waste any more of their time, and I didn’t want them to waste any more of mine.

A good salesperson should know the type of customers they work best with, and if the people they are meeting with are the right kinds of customers for their organization. After a few questions, you should be able to determine if it makes sense to keep talking. If not, end the meeting.

2. Address concerns completely.

When a concern is brought up, don’t skip over it. Stop for a moment and consider what could be causing it. Is it a real objection?  If so, take a moment to prepare your response.  Then fully address the concern with the customer.  For example, if a prospect says your price is too high, focus on showing the value of your product or service. Frame your price in terms of the immediate and long term benefits the person or company will receive.

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3 Keys to Crafting the Perfect Logo

3 Keys to Crafting the Perfect Logo No exceptions: all entrepreneurs need attention.

There are many things you can do to get attention. But start by asking, attention to what? What will people see and instantly recognize as being your business? It’s all about your logo, the first-and-always visual ambassador of your brand. In that sense, it’s the foundation and future of your entire business. What makes a great logo, a great ambassador? Here are five keys to ensure that your logo will match the “look and feel” of your business.

1. Simplicity is your friend.

Day in and day out, you constantly see incredible amounts of visuals and colors. But just because something sticks out visually, doesn’t mean you’ll remember it or feel good about it. Clean design is key. Graphics professionals spend years in training to consistently translate ideas into clean design: the right shape, size and proportions without distracting bells and whistles. “Civilians” like us can get professional-looking results by using a make-it-yourself website like LogoGarden.com. Often these sites are free, so you can experiment and get a finished, clean-design logo quickly with no risk.

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ABCs of Small Business Industries: A is for Automotive

automotive industryWelcome to week three of our ABCs of small business industries! Today’s focus in the series? The automotive industry! This particular industry works alongside anything involving the design, manufacturing, marketing, development, or selling of motor vehicles. What’s not included here, however, are auto repair shops or any sort of gas station.

If your dream has always been to run your own vintage car garage or design automobiles, keeping the following areas in mind to ensure a smooth start!

What do you need to get started?

The biggest hump you’ll have to get over in starting a business in the automotive industry is familiarizing yourself with all the industry rules. This industry in particular has a strict list of guidelines to abide by and follow, but, luckily, the Small Business Administration has you covered. Details on emission standards, how to become a registered motor vehicle importer, knowing the ins and outs of automobile certification, and information on the automobile federal trade commission will all come in handy to keep under your belt in such a robust industry.

Additionally, make sure you have a registered agent in place to handle all of your state mail and remind you of important deadlines, a business/operating license so you can do business where you’d like, and a federal tax ID (EIN) in place if you plan on hiring a strong team to come and join you.

What sort of entity should you form going into the automotive industry?

Though every business owner has the choice of filing whichever entity he feels best suits him and his business, it is common for business owners in the automotive industry to file as an LLC, probably largely in part to the appealing nature of the pass through taxation. This means that business owners who file as an LLC will only be taxed once, whereas with other entity forms, they could be getting taxed twice at both the company level and again at the owner. An LLC is also very easy to get started as well as easy to maintain.

How healthy is the industry?

Around the world right now, there are over 1 billion cars. According to Edmunds.com, “16.4 million car buyers are expected to continue to flock to the market, taking further advantage of more freely flowing credit to refresh the oldest vehicle fleet in history.”

Being that the automobile is the primary mode of transportation around the world, we have formed a strong sense of dependency on the automotive industry – and if you’re planning on starting a business to help out those who need extra assistance with their vehicles, now is a great time to do it!

Want to put the pedal to the metal and start your business in the automotive industry? MyCorp can help you get started! Just leave a comment below, or give us a call at 1 (877) 692-6772, and we’ll help you get your licenses, DBAs, and EINs squared away! 

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Experts Weigh In: What Kind of Entrepreneur Are You?

Experts Weigh In - What Kind of Entrepreneur Are YouHere at MyCorp, we know entrepreneurs come in all shapes and sizes, but how do you know what kind of entrepreneur you are? We spoke with 75 ‘treps about where they stand on the entrepreneurial scale – from solo entrepreneurs to serial entrepreneurs and even artrepreneurs and bropreneurs, find out what style suits you best!

1) “I love being a single mompreneur as it has allowed me to be there for my kids over the last ten years, while still building my business during early morning hours, while they are in school, evenings and some weekends. I recently hired my oldest daughter to help part time and we both enjoy the time we spend together working on the business.”

- Theresa Polley, Owner, Retreat in the Pines

2) “I’m a solopreneur and my favorite part is having other solopreneurs on a similar journey who I can bounce ideas off of and share experiences with. I also love being able to completely chart my own course and decide for myself what my business is going to be about.”

- Matt Becker, Founder, Mom and Dad Money

3) “My wife and I work together in our full time, award winning, photography studio. We used our wedding gift money to get started in 2009 and we’ve been growing ever since. We do about $175,000 in gross sales a year and that’s a lot considering the industry where everyone has a camera and are hiring pros less often.”

- Michael J. Molinski, Owner/Photographer, Photographics Solution

4) “I am an Attorneypreneur. My favorite part of being an attorneypreneur is that I get to think like a business person but get to help my fellow lawyers in the legal community.”

- Matt Reischer, MBA/JD, CEO, LegalAdvice.com

5) “I am an entrepreneur; well actually, I am two types, a solopreneur and mompreneur. My favorite part about being an entrepreneur is the ability to run my own business, ability to continue raising my family on my time, and being the wife and mom, I need to be. I am in charge of ethics, morals, and any other decisions to continue a smooth operating business.”

- Sedaria Williams, Founder and Sr. Publicist, Airades Public Relations

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Experts Weigh In: How I Think Outside of the Cubicle

Experts Weigh In: How I Think Outside of the CubicleAh, summertime. Warm days filled with plenty of sunnin’ and funnin’… but you’re marooned at your computer in the office while seemingly everyone else in the world is outside having the time of their lives. If you feel like it’s time to shake things up this summer at the workplace, take the advice of these 17 entrepreneurial pros to step away from the cubicle and get the team hiking, biking, and zip-lining!

1) “At Clarke, we have garden plots on the campus for people to grow their own veggies as snacks. People line up for the chance to weed, water, and more! We have a day of giving, where we go out as a company and do things like harvest heirloom seeds and work in soup kitchens. We just began the process of converting our campus to having a natural prairie walking path one open to the community as well.”

- Laura McGowan, The McGowan Group

2) “We’re a virtual company so we get 100% of our work done from home and encourage our full-time employees (60+ people) to get up and moving out of their home offices. This summer, our Co-Founder Dennis Najjar instituted the 150 Mile Challenge, challenging employees to walk 150 miles over the course of the summer and rewarding those who complete it with $150 prize. The challenge runs from May 1st to August 31st and nearly half the employees joined in, using FitBits, phone apps and other tracking methods to log their miles. So far we’ve logged more than 2,000 miles! We’ve dubbed it #150ADCMiles!”

- Andrea Boccard, Marketing Manager, AccountingDepartment.com, LLC 

3) “Employees of The Guardian Life Insurance Company of America (Guardian), one of the nation’s largest mutual life insurers and a leading provider of employee benefits, hosted a flash event on June 11 to show support for The New York City Police Museum (NYCPM), which, like Guardian, was displaced from its home following the devastating effects of Hurricane Sandy. However, unlike Guardian, the Museum has yet to return to its home at Old Slip due to the extent of the storm-related damages. Over 100 Guardian employees performed a dance routine at Old Slip Park (adjacent to The NYCPM’s permanent home at 100 Old Slip) for about 3-4 minutes, then quickly dispersed. The official video can be viewed on YouTube here.”

- Ana Sandoval, Manager, Media Relations, The Guardian Life Insurance Company

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Why You Should Hire For Personality Instead of Experiences

Why You Should Hire For Personality Instead of ExperiencesIf your company is going through or has gone through the hiring process, you probably know it is not easy to select a potential candidate. Sifting through hundreds of resumes and cover letters can be not only tedious and frustrating, but sometimes it doesn’t even help you find the best person for the position.

Next time you’re looking for a new hire, instead of hiring someone based on how good they look on paper, try centering your hiring process around personality instead. Here’s why a new hire with a great personality can be a better candidate than one with more experience.

You Can Train From Scratch

In many cases, hiring a candidate with a lot of experience is not always a good idea. Their previous positions may have had different methodologies and strategies than your company, making it difficult for your new hire to do things the way your company likes to. An employee hired with less relevant previous experience, but the right personality, can often have the perfect skills for the job with the help of a little initial training. By training a new hire from scratch, you can teach them exactly what you want, without previous experiences and practices getting in the way.

Every Job is Different

If you are looking at the resume of a seemingly qualified potential hire, chances are they may not be as qualified as their paperwork makes them appear. A one or two sentence job description on a piece of paper and a list of past job experiences does not tell you much about a prospective hire’s past work, making it hard to determine if their past experiences are applicable to the new job you are hiring for. However, picking up on a candidate’s passion, energy and hard working spirit in an interview is something that is hard to miss and can often speak volumes more about a candidate than a resume.

More Personality Means More Passion

By choosing a new employee who truly is interested in and passionate about your company’s goals and services, you will be hiring your company’s next best advocate. Hiring someone who has less experience, but more energy, will help bring you a more committed employee who will work hard to learn new skills to help ensure your success.

For a case study, let’s look at Hydroworx, who specializes in water rehab therapy. They do a lot of sports rehab with NHL superstars like Robert Griffin III and Adrian Peterson. When they were voted in the top of “Best Places to Work in PA” for the fifth year in a row, I asked them how they pulled it off. Their answer was simple: they hire people who were passionate about helping people. They’d pick the person who loved sports rehab over the person who had 10 years of experience but was just looking for a paycheck.

Quality Over Quantity

If you are choosing between someone with more experience and a candidate with a better personality, keep in mind that quality is better than quantity. If you are noticing that the person without as much experience knows more and seems more enthusiastic about your company, then they could be the better overall candidate than someone with more previous relevant work experiences but less enthusiasm. Sometimes a candidate with fewer experiences can be better than an experienced one who has had bad past experiences and may be burnt out.

Choosing the right candidate for your company’s open position doesn’t have to mean hours of reading and comparing resumes and cover letters. It can be as simple as going with your gut.  Malcolm Gladwell’s book Blink shows that your gut is right more often than you give it credit for.  Getting a good feeling about a candidates personality is often much more important than a long list of experiences, and it can lead to finding a better candidate.  So make your next job search about passion and personality, and expect nothing less than a great new hire.

Scott Huntington is a writer and blogger. He lives in Pennsylvania and with his wife and son, writing about social media and doing research for UB Solutions. Follow Scott at @SMHuntington.

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Understanding the Necessity and Limitations of a CGL Within Your Small Business

Understanding the Necessity and Limitations of a CGL Within Your Small BusinessAs a small business owner, you’ve invested a great deal of time and money creating a company you take pride in. In order to protect it, you may consider purchasing a commercial general liability insurance policy (or CGL for short). But what is a CGL and how can it help protect you and your business? Keep reading for a breakdown of the basics.

What is a CGL?

Commercial general liability insurance policies are designed to protect businesses when they are sued. They usually protect against claims of bodily injury or property damage. According to the American Bar Association, these policies are written using forms generated by nationwide insurance industry organizations. The ABA points out that, “Because CGL policies are products of insurance industry draftsmanship, courts in most jurisdictions construe any ambiguities in favor of the policyholder.”

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Experts Weigh In: How I Keep My Business From Burning Out

How I Keep My Business From Burning OutSummer is finally here, and for small business owners everywhere this is the time to relax and take a breather from last winter’s busy season, keeping up with resolutions from New Year’s, and filing taxes in the spring. But for some entrepreneurs, stopping to take a breather can easily mean just stopping… period. Before you burn out on your start-up, let our panel of 23 professionals fill you in on what you can start doing this summer to pump up your business and have a lot of fun, while beating the summer heat!

1) “We are based in gorgeous Santa Monica, CA, and are a walk away from the beach which means some of the most stunning work breaks you can think of. Given that this summer is the World Cup and we are a very diverse company, we encourage everyone to wear their country’s jerseys and will be showing major games in our movie room. We will also be sponsoring different meals based on the soccer teams playing that day! Every Friday during the summer, we break out the cocktails or head out to our local winery (bodega wine bar) to talk about the week over some yummy drinks for happy hour. For bonding, we have a monthly poker tournament which works well especially since we are growing and adding new faces often. It gives our team a great opportunity to bond with new members over a game of all in or fold.”

- David Daneshgar, Co-Founder, BloomNation

2) “We’re taking advantage of our green rebranding efforts to keep everyone psyched about coming into the office. Aside from bagel Fridays and get-to-know-your vendor meetings, Shoplet is instating an office-wide Share competition, whereby we motivate employees with fun, summer-friendly prizes to participate in our latest social media campaign Care. Share. Grow. (For each Share of a social media graphic, Shoplet plants a tree with Trees for the Future). The latest winner of our Share competition won tickets to a Yankees versus Red Sox game this September! In a way, the competitive spirit around the office unites us. It generates chatter and revs up excitement for our green initiatives.”

- Tony Ellison, CEO & Founder, Shoplet

3) “One way I plan ahead for the summer is by offering my employees a finder’s fee for each employee they refer. My argument is that there are no better headhunters than those who already work for you, especially because they are entrenched in the fast-paced environment every day and understand your business’ nuances, thus know whether the person they are referring can handle the pressure. After any prospective candidate is hired and works successfully for two months, I offer the finder employee a cash incentive of $50. It’s a tactic I’ve used for years and found that it’s been incredibly successful at combating summer turnover.”

- Dan Sacco, Owner, Pancheros Mexican Grill

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