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The whole point of being in business isn't just to make a few dollars. Sure, it's nice, but if you only ever stay at a small size, your potential to do so much more will never be fully realized. Every business should be constantly aiming to grow in new directions, which can lead to some amazing things for your company. It can lead to more profitability, a larger market share, and provide jobs as you begin to add staff. New staff can bring in many other experiences and ideas to help your business grow. Make sure you utilize your staff well and keep the good ones around. Pay them more, promote them, give them incentives to perform well, and they will be happy which means that you will be happy having an employee who will treat your company like it's their own.
There are five stages of growth that every business goes through. This list will give you a good breakdown of what the stages are, and what to expect. That way, you can pay close attention to where you're at and it will help you grow properly at the right time for your business.
Here is a list of the five stages and what to expect at each step along the way:
1. Developmental Stage - A precursor to this stage can be done through a feasibility study to see if your idea makes sense. Once you have decided on your idea or a concept and would like to pursue it, it's now time to start putting together a business plan. Your business plan should be clear and set a course for the duration of your company. It's wise to regularly check in on your plan and revise, add or subtract as needed so that you can keep up with the requirements of your business. Doing this will ensure that you continue to grow and put your resources into the right areas so there is as little wasted potential as possible. After you do your check-in reviews, you can identify the target areas affected. Having a continuous cycle like this will enable you to max out your chances of being successful. A well-done business plan also provides great opportunity if you need an investor. It needs to be clear, concise and show exactly what your plan is. Then it will attract the right investor There are a few key questions to ask yourself at this stage:
2. Start-up Stage - This stage is probably the scariest part, it's no wonder that many entrepreneurs back out at this point. This is where it gets real and once you commit, there's no turning back. Congratulations to you if you're at this stage, it can be scary yes, but it's also extremely exciting to see your idea come to life. Some challenges you need to be aware of at this stage:
3. The Growth Stage - Now that you've successfully gotten through the start-up stage, your company is really starting to grow. At this point, you should be generating decent revenue from your customer or client base. You do need to be careful at this stage as well, because while you are growing, now you're likely going to be facing tough competition from your competitors. Taking your business to the next level now requires some fine-tuning of your business plan. You want to improve your operational efficiency, as well as improve your profitability. You need to analyze your key areas of profit and then figure out a strategy to increase the profit while incurring the lowest costs possible. Some areas you may face challenges at this stage:
4. Expansion Stage - Now that you've grown so much, it's time to look at expansion. Businesses that are in this stage are looking to acquire a larger market share and look for new ways to bring in more revenues and profits. Careful planning is required at this stage. Key research into new market areas is vital. Otherwise, you might make a mistake that could cost a lot of money, time and effort. Expanding is a very exciting area for a business as well, it shows you are truly thriving, but still requires you to be efficient and careful. Some challenges that you may face at this stage:
5. Maturity Stage - Now you've reached maturity, it's amazing to see what was just once a thought, has now become a reality. Because you stuck closely to the stages of growth and your business plan, your company has now become a well-oiled machine. It should be very stable and profitable. While this is the final of the five stages, you don't want to just sit back at this point and not find ways to improve your business. A company that begins to have slow growth at this stage will likely want to revisit key areas and again, find new ways to bring in revenue and profits. You may also have decided that it's time for you to move on, in which case you will want to have a great exit strategy. There are a few challenges you will face at this stage:
As you can see, all these stages are vital areas to be aware of as your business continues to grow. Knowing where to look for help at each stage will ensure that your company continues to be a success!
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As business owners, we have a lot of responsibilities. There are many things we must do day by day so that we can keep on growing our business. It's not easy to wear so many hats at one time as a business owner, that's why I've put together a list of responsibilities for you as the owner, and ways you can delegate many responsibilities to your employees or those who are helping you in your business.
Every business owner needs help. An important key to your success is to find the people who are experts in a specific area, so that you can focus on the most important part of your business - growth.
Here's a list of key responsibilities and ways we can overcome the challenges associated with them.
As you can see, small business owners have a diverse range of tasks and responsibilities that are key to ensuring a successful business. As the owner, you will need to have the skill to adapt to changing responsibilities and roles. Being able to let go of one area and have someone else focus on it will allow you to grow your business in all kinds of new directions. Knowing these keys areas and being adaptable will allow your company to thrive and grow.
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Getting ready to do business can be an overwhelming task. Keeping lists and organizing yourself is a great way to make sure you don't miss anything when getting set up.
Here are some business registration tips for those starting on their entrepreneurial path to fulfillment!
I'm going to assume you've already done all your research and much of your planning at this point, and now you're ready to register your business and get going.
Remember these key items as you are setting up your business because you can't afford to miss these important items. Also keep in mind that for any business set-up, you are wise to seek legal counsel and help with everything from actual registration to contracts and all sorts in between. Seek a trusted lawyer and advisor, and make sure you get yourself a great bookkeeper. Don't wait on the financial side of things, it can cost you a lot more in the long-run than if you do it properly right from the start.
As you can see, there are a variety of important factors to consider when registering your business. This list doesn't include every single thing possible, so please make sure you do your proper industry research to find out what other factors you need to know about.
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By Tim Rose - Owner of The People's Bookkeeper
When starting a business, there are so many things to think of and organize. Protecting your business is one of the most vital keys that often gets overlooked by many who just don't realize the implications of not organizing their business needs effectively. As a business owner, protecting what you've worked so hard to build up over the months and years is of utmost importance, and something that we should be striving to do on a regular basis. After all, you don't want to lose everything you've work so hard for. Below are some great tips and tactics to not only protect your company, but your own life and well-being also.
Know Your Applicable Business Laws - Knowledge is power, so knowing proper business laws that are applicable to your own company is vital. Every industry is different, and governed by different boards and authorities, so know your industry and what you can and cannot do. You need to familiarize yourself with the financial laws, labour laws, copyright and trademark laws, marketing laws, and advertising laws just to name a few. You don't want to use any kind of misleading ad or put your company in jeopardy because you said something you shouldn't have.
Always Have A Contract - This point cannot be stressed enough. Always get everything in writing. If you're building a new relationship with a client, partner or provider, it's so important to make sure it's put down on paper and signed by both parties. Each side is then protected and hopefully this will keep away any possibility of things turning sour if something doesn't work out.
Create A Secondary Company - Creating another company that can hold differing assets can protect those assets should your company fail for some reason. Under one umbrella, if your company went belly-up, you'd likely lose out on everything. But if you create a new company that holds your real-estate properties for example, then you won't lose them should something go wrong with your main company down the line.
Protect Your Intellectual Property - This is a vital component for so many businesses, especially for an online business that has tied up large amounts of money in website design, copyrights, trademarks, software, patents and more. As a small business owner in this realm, you need to ensure that you have taken proper steps to protect your intellectual property so that no one can steal your ideas and claim them as their own.
Get Paid By Your Clients & Customers - Nothing will stall your business faster than non-paying clients and customers. I recommend getting set up with a great payment processor and setting up automatic recurring payments for clients that pay you each month. For customers who are purchasing your goods, make sure your processor takes credit cards and debit cards online, that way you get paid very quickly. One of my favourite payment processors is Stripe. They provide an amazing payment processing system that integrates with many other software programs including QBO and Xero, my two primary choices for bookkeeping and business needs. You should be checking your aged receivables each month to keep up with what you are owed. This is also important, so you can pay your bills on time as well. You need to make sure you are getting paid, otherwise you aren't going to be around for too long.
Always Keep Records Up-To-Date - Don't be careless or indifferent with your paperwork. The CRA may come knocking one day, and you don't want to get caught not having paid proper taxes. You could face potentially huge fines and penalties that could cost you your company. There's also the cost of hiring a lawyer to defend you, which will cost a lot of money. Don't be cheap in this area, pay someone well to take care of your books, and hire a good accountant to take care of the taxes. This isn't an area to mess around with. Make sure that you get your receipts, documents and papers to your business caretakers on time. I set my own clients up with some excellent automated processes to make this part very easy on them. Ask your bookkeeper today about what they can do to help in this area, or use our contact form & send your questions to The People's Bookkeeper today and let us help you improve your business.
After reading through these tips, I really hope that you will take the time to properly research your own industry and if you've missed any of these important points, don't wait any longer. There's nothing worse than losing something you've worked so hard for. Protect yourself and your business today.
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By Tim Rose - Owner of The People's Bookkeeper
There are lots of ways for you as a business owner to ensure that your business is growing effectively. You know how busy things can get, and it can be so easy to get distracted by the many tasks you are doing each day. It's not your fault. We need to make sure as business owners that we are keeping our eye on the bottom line and leading our companies into the next phase of our growth. That's why I have compiled a list of excellent tax saving tips and advice for you, so that it can take some of the guesswork out of what you should be doing to help your business. A lot of us just don't know these little tips that can save us a huge amount of cash over time, which means more for your business and allows you more room to grow.
The General Rule - Generally speaking, if expenses are incurred to help earn income, then they are tax deductible. Therefore, you should try to deduct everything that you are legally allowed to. It can add up to quite a bit.
Claiming Home Expenses - Normally, you can't claim certain expenses like a home mortgage when running your business out of a building or office. However, if you run your business from home, you can claim a portion of mortgage interest, insurance, electricity, supplies, heating, hydro, repairs, maintenance and property taxes. The percentage allowed is based on the actual square footage of the space used for the business, not the entire house.
Income Splitting - This is a great tactic to use whereby you split income with your family members. Since the CRA may demand to see an employment contract and not just a T4 slip, you need to be careful. Your family member must be doing real work, and you must be doing real paperwork. A nice way to handle the whole situation is to make your family members shareholders of your company and pay them dividends instead of a salary. Setting up a discretionary family trust means that you can choose when to pay your family members, and how much to pay. If one of your family members needs support, or is in school for instance, the company can provide the needed support any time that help is needed.
Giving Yourself More Dividends - A lot of business owners and entrepreneurs don't take advantage of the big tax savings that are possible by paying themselves dividends. Depending on your location, you can take between $30,000 to $40,000 in dividend income before you start paying taxes. In your early days especially, this can be a wonderful way to make sure you get more money in your pocket and save a lot in taxes. As your needs change year by year, you can adjust your salary/dividend mix to suit your own needs.
Travel Expenses - If you're going to a convention or large business event, you are generally allowed to deduct expenses if it is directly related to your business, and it's within reason. For example, if a chef was going to a food and cooking convention in another province, it would be deductible. However, if the chef decided to go to a convention in Australia, it would likely not be deductible. The CRA also has rules regarding additional expenses that are not allowed. While you can deduct the full cost of your plane tickets to the convention, you cannot add on personal days, or extra hotel days beyond the actual dates of the convention. If your spouse decided to tag along, their ticket would not be deductible either. Don't be afraid to claim your travel expenses, it can save you a lot of money over time. Talk to your accountant and bookkeeper today if you are unsure.
Meals & Entertainment Expenses - In Canada, meals and entertainment are 50% deductible. You should take full advantage of this when you can, since it gives you a great opportunity to meet with clients and grow your business. However, the CRA does has some rules and limitations as to what is acceptable. Allowable expenses include meals eaten with customers, tickets to a concert or event, private boxes at sporting events, hospitality suites, cruises, fashion shows, and the costs of entertaining guests at sporting, social, or night clubs. Taxes, gratuities and cover charges are also included in entertainment expenses. Deductions that are now allowed include club dues or costs incurred using recreational facilities. You also cannot deduct season tickets for sporting events unless you can prove that it's for promotional use. You are also not allowed to claim meals if you are outside your sales territory or on a vacation.
As you can see, there are many ways to save a lot of cash for your company. If you weren't aware of some of these items, then talk with your accountant and get their advice today. There are so many ways you can save and put that extra savings either into your own pocket, or back into your business to grow. Having the freedom to do more with your company is a great feeling, and if you aren't doing these simple things yet, then get started now. It's never too late, and it's worth the time and effort. It's far more important to see that extra money in your pocket, especially when it can help your family and friends if needed. You can even invest it into other businesses and grow in ways you never expected.
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By Tim Rose - Owner of The People's Bookkeeper
We all have our struggles in our businesses. When you're trying to do everything yourself, it can get messy. That's why it's essential to find yourself a great bookkeeper. Having a great bookkeeper can make your financials flow much smoother, thus leaving you to focus on your passion - your business. Here are some great tips for you as a small business owner that can help take your company to the next level.
As you can see, there are a lot of things to think about when you're a small business owner. These are just some of my best tips to help you out as you are growing your company. You want to make sure that your business is running on enough cash flow so that things don't get too tight. If your cash flow isn't where you want it to be, then you'll need to consider cutting expenses and managing your cash flow in different ways. A great virtual bookkeeper is going to be able to help you with this each month.