November 10, 2009 |
Dear Karen: How can I make a good decision about buying an ice cream franchise? Answer: Request a document called the Uniform Franchise Offering Circular, which franchisers are required by law to provide. Next, do your own research on this opportunity. Is it within your budget? "Food concepts are some of the more expensive franchises, but ice cream franchises are on the low end in terms of capital requirements," said Garth Snider, president of FranchiseOpportunities.
July 4, 2011 |
Dear Karen: Our business always has a backlog of payments due. How can we cut it? Answer: Offer incentives to decrease collection time. You might try giving a 2% discount for payments received within 10 days of invoicing, said John Formento Jr., an analyst at Sageworks, a financial information company. Examine your customers' payment history and contact slow-paying customers to work out a schedule. "If necessary, decline further credit offerings to them," Formento said.
November 22, 2010 |
Dear Karen: How much cash should a small business set aside as a reserve fund? Answer: Because economic recessions are cyclical, having an adequate capital reserve is imperative for small businesses. It's also important to hedge against seasonal downturns and family emergencies or health problems. Just as individuals are advised to save enough to meet personal expenses for three to six months, companies should do the same, said Jim Sharvin, a CPA in Torrance. "Put that savings in a money market fund or a short-term CD. Don't put it at risk at all," he said.
May 9, 2010 |
Dear Karen: How can we improve sales? Answer: Track sales performance. See where your sales leads originate and which ones are most effective. You can't identify what's working if you're not monitoring it closely. "Identify the real drivers of your business, and stop throwing away money on what's not working," said Jeff Solomon of Leads360, a Los Angeles software firm. "Chances are, one or two sources generate the bulk of your revenue." Instruct your sales staff to respond to inquiries within five minutes, send follow-up e-mail and stay in touch with potential customers.
May 16, 2011 |
Dear Karen: Can you explain the new use-tax law for small businesses? Answer: Use tax is not new, said Brad Graves, an accountant and partner at Haskell & White in Irvine. Longstanding tax law requires consumers to report and pay use tax on goods purchased from out-of-state vendors, such as online retailers, who do not collect California sales tax. What is new is the 2010 requirement that taxpayers with more than $100,000 in business gross receipts register with the state's Board of Equalization.
January 31, 2011 |
Dear Karen: I'm 20, and no one takes my business seriously. What can I do? Answer: Overcome negative perceptions about your youth by running your company in a professional and serious manner. Don't cut corners on things such as licensing or legal agreements. You may be tempted to design your own website to save money, but unless you can produce high quality, don't. "I would say it's twice as hard, at least, to be considered a legitimate and stable business" when you are a young entrepreneur, said Andi Enns, a college student and marketing consultant in Kansas City, Mo. She recommended that you present your youth as an advantage by including compelling stories about your journey into entrepreneurship in your marketing campaign and on your website.