Make 2006 Your Most Profitable Year Ever: 5 Crucial Steps for
Every Entrepreneur
Many of us maintain the tradition of making New Year's
resolutions for our personal lives. The New Year has just as
special significance for our businesses too.
Whether you're an experienced business owner or are just
starting out (or thinking about starting a business), there are
5 crucial steps you need to take at the beginning of the year to
assure the 2006 is your most prosperous year ever.
1. If you have not done so yet, take advantage of the greatest
tax shelter available today: the opportunity to start a small
business and organize your business activities to generate
multiple streams of income for you.
If you have been thinking about starting your own business but
are still sitting on the fence, resolve to take action today!
With the internet making getting into business for yourself
easier and more cost-effective than ever, there's no excuse for
not taking that crucial first step.
2. If you already own your own business make sure that you're
generating income from more than once source.
This way, if changing economic conditions exercise a negative
effect on one stream of income, you are not left high and dry
(so to speak!). If you're involved in network marketing, you'll
have to make a point of ignoring those who would have you focus
exclusively on a single company (often start up) that might not
be around 5 years from now). You can and should diversify
(within reason, of course!).
3. Make sure that you are using the most advantageous structure
for operating your business.
This applies to you whether you have a traditional
bricks-and-mortar business, operate a UPS Store franchise, or
are operating an e-business doing affiliate marketing.
If you're operating your business as a sole proprietor, as most
small business owners do, your business is not in the most
advantageous position to reap the fruits of the generous tax
deductions available to small businesses. More important, you
are placing all your personal assets, including your home, your
vehicle, your personal savings, and your family's future at risk.
Today, it's no longer as cumbersome as it used to be to
establish an alternative business structure that will protect
you from such risk. And with all the resources now readily
available to the average person at minimal cost, you don't have
to incur massive legal fees just to get started.
4. Resolve to learn the information you need to know to operate
your business in the most profitable manner.
Continuing education about structuring and operating your
business is an absolute necessity for the entrepreneur. Even if
you have an accountant or attorney on your mastermind team, how
do you know if she has the knowledge and sophistication to
handle this for you properly? Unfortunately, too many, do not,
and their lack of expertise can cost you thousands of dollars.
If your accountant or attorney tells you, for example, that you
"don't need" an LLC or corporation to do business, you'll know
to run--do not walk--out of their office as quickly as possible
and search elsewhere for competent advice.
In addition, even if you have competent counsel, it is your
responsibility as a business owner to operate your company in
accordance with government requirements governing corporations,
partnerships and LLCs.
5. Adopt a Mindset that Focuses on Tax Reduction as a Way of
Life
The largest single expense of most Americans is taxes. To
optimize your bottom line, you must be up to date on which
expenses are tax deductible for your business and keep proper
records to document them. Using a credit card--even a personal
card dedicated to your business--and an accounting program that
is specifically for businesses--we recommend QuickBooks by
Intuit--will help you immensely in keeping track of your
expenses. It can be bought at a substantial discount on eBay.
Implementing these 5 steps might sound complicated at first,
but they are well worth the trouble. Remember that in running
your business, "Keep it simple" can be costly advice. What
simplest--setting up shop as a sole proprietor, operating on a
cash basis, using your personal bank account instead of a
separate business account for your business, and failing to
track and document expenses using appropriate business
accounting software--can hazardous to your financial future.
Take advantage of the fresh start spirit of the New Year to
implement these 5 tasks, and you'll be on your way to making
this year your most profitable ever.