Mention those two little words to almost any small business owner, and you’ll see them flinch.
Very few business terms get as cool a response. And sadly, those two little words (both of them four-letter words, interestingly enough), are the #1 reason small businesses fail. They take out more small businesses than any other factor.
In fact, 82% of small businesses fail due to cash flow problems. Continue reading
The “gig economy” — the market for individuals providing services or working on projects on a freelance on-demand or short-term contract basis — has been a growing trend. While there are no official gig economy statistics available to measure its prominence, we can make some assumptions about its increasing popularity based on other available data.
According to information reported by the United States Census Bureau, the number of non-employer businesses, the group of individuals most likely to work on gig basis, was 24,331,403 in 2015. That’s 10% more than the 22,110,628 non-employer businesses in 2010.
And opportunity abounds for independent professionals who take on gig assignments. Many businesses outsource work to independent contractors and freelancers when their staffs are overwhelmed and to avoid the costs of benefits and ongoing payroll that come with hiring new employees. Continue reading
by Kelly Deis of SoundPoint Consulting
Owners want to sell their businesses for for a variety of reasons – some want to retire and others are ready to move on to something else. Most owners ask – “is now a good time to sell?” Not surprisingly, the answer is, “it depends”.
Here are three factors to consider when timing the sale of your business. Of course, it is best when all three are optimally aligned, but that is not always possible.
The State of the Owner
The owner is critical to the success and ultimate value of a business. Typically, once the owner is beyond his or her prime, the business value will begin to falter.
It is best to sell when the owner is engaged, still excited about the business and perhaps wiling to stay on after the sale. Likewise, the more youthful and healthy the owner the less they will appear eager to sell.
You want to be the owner that wants to sell, not one that has to sell. Continue reading
by Mary Marshall, CEO Coach
The most successful entrepreneurs figure out early on that they are not alone, that they are not infallible and that they need people better than themselves to do certain things.
However, we often have this vision of the entrepreneur as a superman or woman, slaying all the obstacles on the path to greatness all on their own. I’m here to tell you that image is simply not true. If it were, we would only be building companies of one and the term solopreneur would be all the rage.
Entrepreneurs do have good ideas and often strategies for putting their plans into motion. They often have a unique or different vision that others have not imagined yet but what they cannot do is single-handedly make it happen.
I’m reminded of this as I start the new class of Seattle Emerging Leaders at the SBA. These are businesses who have been operating for at least 3 years but at some point, became stuck and could not get past a certain stage of development. As this year’s class introduced themselves to one another, two very similar narratives emerged.
First, they were greatly relieved to be with other entrepreneurs like themselves who felt more or less alone. Realizing that everyone in the class was having the same experience was an eye opener for all of them. Secondly, they realized that part of their struggle was that while working in the business they rarely, if ever, had time to work on it so accountability for that went out the window with the pressing challenges of each day.
Read more on Mary Marshall’s website…
From the Washington Department of Revenue website…
There is a misconception that services are not subject to sales tax. This article clarifies that some services are indeed subject to retail sales tax. Following is a listing of services that are subject to sales tax when provided to consumers.
Construction services (WAC 458-20-170)
- Constructing and improving new or existing buildings and structures. Installing, repairing, cleaning, improving, constructing and decorating real or personal property for others
- Cleaning, fumigating, razing or moving structures, including painting and papering, cleaning and repairing furnaces and septic tanks, and snow removal
- Clearing land and moving earth Continue reading
Many startup small business owners take pride in pulling themselves up by their bootstraps and not using financing to get their companies off the ground. But that approach can backfire, a new study in the Journal of Corporate Finance suggests.
The study, conducted by Florida Atlantic University faculty, assessed what happened to companies that took on debt during their first year of operation.
The authors discovered businesses that took on debt are more likely to succeed (as long as they use business debt as opposed to taking on personal debt).
What’s more, they’re also more likely to achieve higher revenues. Continue reading
by Kelly Deis of SoundPoint Consulting
A dollar is a dollar. That’s true. And, all revenue is equal. Right? Well no, not in an investor’s or potential buyer’s eye. So what makes some revenue good and other revenue not quite as good?
Recurring revenue is highly desirable because is it known and predictable. The best example of this is an auto-renewal fee or service charge periodically charged directly to a customer’s credit card. Once the initial sale is complete there are no more costs to acquire a customer. The revenue stream is much like an annuity. Continue to provide the goods or services as promised and the revenue keeps coming in.
Great examples of this are insurance premiums and streaming fees. Once customers have decided to purchase the product – and assuming they remain content, they are happy to have their credit card billed automatically.
In contrast, consulting and attorney fees are often one-time in nature. Revenue ceases when the project is complete and the engagement ends. Continue reading