BUSINESS PLANNING - THE ROADMAP TO GROWTH

In small business, hardly two other words promote fear and procrastination more than “business plan”.  It is often considered as an interruption to the day to day tasks of running a business; or, too difficult to contemplate.  When entrepreneurs think this way, they are on the road to problems. What is often missed is that the business plan has two primary functions (among several others)—to determine how much you know about your business; and, what you don’t know.  To skip the essential process of preparing a business plan exposes you to tactical or “crisis” management—doing tomorrow based upon what you just learned today. It is the roller coaster method for managing a business, and may be part of the reason why 4 of 5 new businesses fail.

This type of outcome is not inevitable.  A well-constructed plan can not only avoid the hazards of tactical thinking.  It also provides a road map to a more successful outcome.  The process of preparing a plan leads the business owner to examine all facets of the business, ask all of the questions that lead to strategy development, and produce an organized approach to the future.

HINT:   A business plan is not a static document meant to be done once, then gather dust in a file drawer.  The obligation to review and periodically update the document forces the discipline to really look at what you have done, compare it to your expectations, and take corrective action.

Carl Isbits, SCORE counselor.  email

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Make a customer not just a sale

There is a big difference between "making a sale" and "making a customer".   If you don't achieve the latter, you won't, in the long run, build your business.  After all, you don't want to always have to make that 1st sale over & over again.   You want to make sure your buyer will find VALUE in the transaction and BENEFIT from your product(s).  If this comes about from THEIR PERSPECTIVE they will want to continue doing business with you in ever increasing volume & cooperation..

That means you must UNDERSTAND your customer, their NEEDS, and fulfill in a way which converts that customer into a "brick" in building THEIR success.   It is a TWO WAY street when marketing.   You do need to meet your sales goal, yet understanding the customer is to have them become your ally in the marketing of your product.

So THINK TWICE how you promote your product.   Orders only on their own just for the sake of getting that order, often lead to dead ends.   But if you evaluate your customer's NEED BENEFIT and VALUE from the CUSTOMER'S POINT OF VIEW,
a long term relationship will develop resulting in growing future business volume.

HINT:   Picture yourself facing the customer across a table.   You are selling & he's buying - maybe.  You and the customer are on opposite sides of the table.   Now, try to picture yourself on the same side of the table, sitting next to him.   Now suddenly you are his ally,  his "partner".    That's the psychology you should project.

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2012 Tax Changes for Business

Whether you file as a corporation or sole proprietor here's what business owners need to know about tax changes in 2012.

Standard Mileage Rates 
The standard mileage rate in 2012 is 55.5 cents per business mile driven, 23 cents per mile driven for medical or moving purposes, and 14 cents per mile driven in service of charitable organizations.

Health Care Tax Credit for Small Businesses 
Small business employers who pay at least half the premiums for single health insurance coverage for their employees may be eligible for the Small Business Health Care Tax Credit as long as they employ fewer than the equivalent of 25 full-time workers and average annual wages do not exceed $50,000. The credit can be claimed in tax years 2010 through 2013 and for any two years after that. The maximum credit that can be claimed is an amount equal to 35% of premiums paid by eligible small businesses.

Credit for Hiring Qualified Veterans
The maximum credit that employers can take for hiring qualified veterans in 2012 is $9,600 per worker for employers that operate for-profit businesses, or $6,240 per worker for tax-exempt organizations. See Tax Credit for Employers Hiring Veterans This Year (below) for additional details on this tax credit.

Section 179 Expensing 
In 2012 the maximum Section 179 expense deduction for equipment purchases is $139,000 ($174,000 for qualified enterprise zone property) of the first $560,000 of certain business property placed in service during the year. The bonds depreciation is 50% for qualified property that exceeds the threshold amount.

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