Virtuoso Team Consulting, Inc.

With a new year come new goals, new challenges, and new opportunities for success. Regrettably I have let my blog get lost in the shuffle of life and work, and that is something I resolve to fix this year. I will make a concerted effort to post, at least a small article, once per week. There are a lot of facets to business, and I should have no problem coming up with topics, but I would like to hear from others. If there is a topic you are interested in, have a question about, or even something would like to write a guest post, please email or call. It will help me collect ideas as to what to write about and also ensure everyone gets timely information about what really matters.

At a New Year’s party last weekend a number of people expressed interest in starting their own businesses this month. It seems since the economy is still in a state of flux people would rather cut their expenses and make a go of business ownership than continue worrying about losing jobs. They want to have a sense of control of their own lives, their future, and they want to do what makes them happy. While I, being in the business of helping businesses, wanted to get each and every one of these people on contracts, it occurred to me that in most cases they did not have the funds to hire my company. After a few conversations, all similar in scope if different in substance, these realities lead me to a new offering. I want to help each of these businesses get started along the right path, but do not have a great amount of time to dedicate to them. As such, I or a colleague will be meeting with the principals of each company for an hour or two this week to ensure they have a plan laid out, know where they want to go, and set them on the path to achieving their goals, and we will be doing it for FREE. They will have to do all of the heavy lifting, and will succeed or fail based on their own effort, but they will have the solid foundations many companies lack at startup.

Why are we doing this?

Quite simply, because we can! Small companies:

• Represent 99.7 percent of all employer firms.

• Employ just over half of all private sector employees.

• Pay 44 percent of total U.S. private payroll.

• Have generated 64 percent of net new jobs over the past 15 years.

• Create more than half of the nonfarm private gross domes­tic product (GDP).

• Hire 40 percent of high tech workers (such as scientists, engineers, and computer programmers).

As a sector, this is the easiest way to help create jobs, stabilize the economy, and help people do what they are passionate about.

Is there something in it for us?

Absolutely! Once these small businesses start to flourish their goals are going to change, they will outgrow their current business models. They will need to hire or retain a business consulting firm, and we will have the opportunity to solicit that business. Nothing will compel them aside from the fact that we helped when they needed it, and we did it well.

This is not necessarily going to be an ongoing offering, but if you are considering starting your own business, please contact us. We would love to help!

Thank you for taking the time to read this, and I will make every effort to have another post by next Monday.

There are a lot of independent business owners out there who feel as though they have, neither a pot to pee in, nor window to throw it out of. The economic slow down is causing a great many business owners to go out in search of a part-time or even full time job, thus relegating their businesses to an “as able” status.

Truth be told, historically, this is the best time to start a business, and the worst time to have already been running one. Many of my friends are business owners, as makes sense in my profession, and the majority have found other jobs. One, however, recently contacted me and has decided to become lean. He was remembering the old days of his start-up, the fun he had with only a handful of reliable clients. We are currently restructuring his company to take him back to that stage, and it occurred to me that this may be an excellent solution for others too! His revenue is going to drop, but so will his overhead and expenses. I love the idea; it feels like tech going artesian, growth through getting smaller.

Did you go from being a business owner, to having your business own you? If so, I would love to hear your story, and share what you did with others. Please leave a comment.

©2008-2009 Virtuoso Team Consulting, Inc.   All Rights Reserved.

How much will customers be willing to pay for your product or service?

How many customers will buy at that price?

How large is the actual market for your business?

From the beginning, regardless of your education or experience, these questions and others are best estimated by a SHAG, or a scientific half-assed guess. This method is not quite as willy-nilly as it may sound, but is a carefully constructed best guess based on known facts, and supposition.

What facts do we have at hand?

Of what do we feel reasonably sure?

What do we believe to be true, and why?

These represent a psuedo-solid foundation for creating estimates. Whether the company is a start-up or a century old, the importance of these guesses remains the same. The only thing that changes is the historical data sets that show where the company has been, not necessarily where it is going.

There are traps people fall into using SHAGs that I would like to warn against. First, it only gives you a starting point, so be flexible enough to change your course as experience dictates. Thinking that you are right can destroy a business far faster than admitting your wrong. Second, do not over use SHAGs, or put too much faith in them. Anecdotal evidence can only carry you so far, the proof, as they say, is in the pudding. Sometimes it is the questions you don’t think to ask that kills you. This is a process that is best accomplished with the help of a group of people you trust. Generally speaking, the group is smarter than the individual.

©2008-2009 Virtuoso Team Consulting, Inc.   All Rights Reserved.

They say the only two certainties in life are “death and taxes”. Each of these can, and will, have their own blog post, but I we shall start with Death. While this is a terribly morbid subject, I assure you it is something every business owner should take into consideration for a multitude of reasons. Business entities, continuation planning, and insurance are just a few issues that should be contemplated.

There are a number of different types of business entities, each with their own strengths and weaknesses, and I do not presume to know which entity best suits the reader. That is a subject best left to an accountant, tax advisor, or lawyer, and I am none of these. Having said that, one of my preferred entities is a subchapter S Corporation, primarily because it exists outside of the individuals who run it. It has its own name, tax identification number and legal liabilities. Most importantly, if anything happens to one of the principals, the corporation continues in perpetuity. This is in stark contrast to sole-proprietorships and partnerships which dissolve upon the death or incapacitation of a principal.

In the event a sole proprietorship or partnership has been chosen, a thoroughly detailed, legal document should be in place to dictate what happens in the event of someone’s death. The goal should be to keep “business as usual” for the remaining principals, not to mention addressing the rights and responsibilities of the survivors of the deceased. If the decedent is the business, as in the case of a lawyer, physician, or CPA et al, then what plan is in place to service their clients? Can these assets (client lists) continue to be served or sold to another individual or business?

Insurance is a tricky subject that I am licensed to talk about, but will only speak of in generalities for this blog. Insurance, in its simplest terms, is an investment you hope to never have to collect, but is of the utmost importance if it is ever needed. In particular, there are insurance policies to help offset the expenses of keeping the business running, searching for principal or executive replacements, and buying back stock from the decedent’s estate.

These situations should ideally be addressed before starting a company, but if that is not possible, they should be addressed immediately! Do not wait for this or that to happen before you plan for these eventualities or you may lose your ability to do anything about it at all.

©2008-2009 Virtuoso Team Consulting, Inc.   All Rights Reserved.

The sheer volume of things that must be done to legally start a corporation in the state of Florida is astounding:

1.Register with the Department of State of Florida, Division of Corporations

2.If necessary, make sure you have an occupational license

3.Get an EIN (Employer Identification Number) from the IRS

4.Elect and file the paperwork to be a subchapter S corporation from the IRS

5.Pay to be licensed with the county and city, as required.

6.Don’t forget your license to collect sales tax, or pay unemployment tax

7.How about a worker’s compensation waiver?

That is just the legal and tax stuff someone has to go through, let’s not forget about actual business planning, for example:

1.Writing a business plan

2.Creating a marketing plan

3.Registering your domain name (in case you should want to have a web presence, which is highly recommended in this day and age)

4.Establishing your budget, pricing, cost structures and profitability

…to name but a few.

There are also miscellaneous things like bookkeeping software, hiring employees, and exit strategies that should be established.

It really makes me wonder why anyone would want to start their own business, but then I remember what one of my clients at the bank said to me, “Jer, if you do what you love, you’ll never work a day in your life.”

©2008-2009 Virtuoso Team Consulting, Inc.   All Rights Reserved.