New business owners frequently experience feeling overwhelmed. They feel a sudden need to be experts in many fields that have little to do with the product or service they sell. They may believe their budget does not allow for even one non-owner employee. Here are a few tips on ways to lighten the load.
1. Choose Experienced Advisors.
Although good professionals can be found at a range of prices, there is a lower level at which “you get what you pay for.” In choosing a lawyer or accountant, look for someone with at least 5 to 10 years experience in a business practice, unless someone of greater experience supervises that person. Be wary of generalists. Don’t hire the same lawyer to prepare your will, set up your corporation and handle your litigation! For some questions to ask about a prospective accountant, see www.toolkit.cch.com/text/p06_1220.asp.
If you are not the sole business owner, be sure to have an agreement providing a mechanism for getting out of doing business with your partner in the future. Although you get along well now, circumstances may change later due to death, divorce or disagreement about the best direction for the company. Expect the legal costs of setting up your corporation, Limited Liability Company or other entity, including state filing fees, to be at least $1000 for a sole owner, and more for multiple owners. Don’t be tempted to use a do-it-yourself kit. It won’t be tailored to your needs, and do you really know what you need without advice?
To find your professional advisors, ask for referrals from friends, business associates, and other businesspersons you know, such as your banker. You can also get lawyer referral information online at:
- http://www.martindalehubbell.com/
- http://www.findlaw.com/
- http://www.texasbar.com/
- http://www.mytexasbar.com/
2. Have a Written Plan for Your Business.
Even small businesses benefit from having a business plan, and if you need a loan, your lender will require it. Get clear about your goals and what you want to create. Who is your competition? What is your edge? Who are your target customers? How will you reach them? What resources do you need? What benchmarks must you meet to succeed? When you think through your goals and obstacles and develop a plan, decisions are easier, you can avoid crisis decision-making, and you can hold the focus better. Yes, preparing a business plan is a daunting and time-consuming task. It may take months to complete, especially if you are operating your business in the meantime. Take advantage of the FREE counseling available at your nearest Small Business Development Center, an arm of the Small Business Administration (SBA). They will gently walk you through it, step-by-step for as long as it takes. Locate the center nearest you by checking out the website at http://www.sba.gov/sbdc/ . Some resources for online guidance in preparing a business plan can be found at http://www.score.org/ http://www.sbinformation.about.com/, and http://www.toolkit.cch.com/
3. Consider High Deductible Health Insurance.
Health insurance costs are often prohibitively high for self-employed persons and small businesses that don’t fit into a larger risk pool. Try looking for a high deductible policy ($1600 – $2400 deductible for an individual) and a Medical Savings Account (MSA). An MSA is basically a medical IRA. Contributions are deductible from income, and tax is deferred on the interest or dividends the accounts earn. Deposits and earnings are not taxed if MSA funds are used to pay medical costs. Those costs may include expenses not covered under your insurance plan, such as vision and dental care. Unused funds roll over for future use. You can probably find such a policy for around $100 per month instead of the $300 per month you may be paying for $250 or $500 deductible. Some websites that do a pretty good job of answering questions about MSA’s are: http://www.jpeek.com/msa.html, http://www.americanhealthvalue.com/, and http://www.medicalsavingsaccount.net/
There may be some tasks relating to your business that you know you are not qualified to handle, but you don’t want the expense of hiring an employee to do it. Then there are other tasks that you can handle, but that you keep procrastinating on. If these jobs really do need to be done, instead of procrastinating, outsource them. That undone “to do” list that you carry around with you distracts you and drains emotional energy from you in the form of worry and guilt. Here are some resources for getting things done:
Bookkeeping: Bookkeeping services are available over the Internet. Check out http://www.my-netbookkeeper.com/ and http://www.ebook-keeper.com/ to see how it is done.
Virtual Assistants: They can handle anything your secretary or office assistant could do that does not require physically being in your office. Visit http://www.assistu.com/ http://www.sbsne.com/, http://www.vsscyberoffice.com/ or enter “virtual assistant” into a search engine and get the websites of many individual virtual assistants.
http://www.grow-biz.com/ has information on Austin’s Business Success Center development program emphasizing learning and growth strategies.
Some sites that provide a plethora of information and useful links for small businesses are http://www.sbinformation.about.com/, www.sba.gov/starting/, http://www.toolkit.cch.com/, www.womenswire.com/smallbiz, and http://www.thinkinglike.com/.
Adapted from Debra’s article in the August/September 2001 issue of Women Monthly. Apologies to those outside the Austin metro area respecting the resources given only for the Austin area.