BIG MONEY in Small Business: Taking Your Business to the Next Level

Looking to make some extra cash, or increase profits in your business? According to the Forbes article “16 Surprising Facts About Small Businesses” 25% of all small businesses grossed between $10k and $25k in revenue in 2011. It would be difficult to find somewhere in the US where you could live off of that as your sole income, but as a supplement to a primary income you could be living it up! No wonder so many people are making the decision to take control of their financial situations and create their own opportunities for building wealth. Last week, I mentioned that there were 23 million small businesses in the United States in 2010. I’ve learned that number has grown significantly, spiking to 28 million in 2013. This then raises the question of who is figured into this number. SBA (Small Business Association) defines a small business to simply be any organization with 500 or fewer employees. Keep in mind that small businesses not registered with the government are not reflected in the figures above. If we were to take this into consideration, I wouldn’t be surprised if that number doubled! Of the 28 million, 22 million of these businesses are made up of self-employed individuals, with no additional payroll, and over half of the 22 million are set up at home.

What do I mean when I say registered? Well, Uncle Sam always wants his piece of the pie. The only way he can ensure that happens is by requiring anyone who offers a service or good in exchange for money to submit an application and pay fees to be recognized as some form of corporation, partnership or sole proprietorship. Doing so requires that the business be assigned an Employer /Tax Identification number (EIN/TIN). Having this registration makes the owner accountable for paying taxes on any earned income. There are a number of local businesses that have decided not to register to avoid just that. Income generated from these types of establishments is often referred to as “under the table”. Some may view the concept as paying taxes on self-generated income as an unnecessary evil, especially when profits are minimal. However, there can be benefits to following this protocol. I’ll be sure to revisit this topic in future posts. For now let’s focus on getting started. We can figure out how you should register later.

How to get started

How can you become one of these individuals fortunate enough to rake in the dough from the comfort of your own home? It’s not as hard as you think. Brainstorm, Brand, and Build; what I like to call my 3 B’s.

Brainstorm. Figure out what you’re good at and what you enjoy. Be sure to research the market and determine whether there is a demand for what you plan to supply. A great way to confirm that you’ve done your due diligence is to develop a business plan. This will help you come up with a course of action and identify any gaps in it. Your business plan doesn’t necessarily have to be formalized but can simply be a blueprint outlining goals and objectives strictly for personal use. You can also go the route of a more elaborate and formal plan, which generally is most helpful when you are looking for the buy-in of others (i.e. investors). At a very high level you want your business plan to answer a few basic questions: What will the business offer? Who is your target market? Why do you think your product or service will be successful in that market? What financial obligations will the business create? There are many free business plan templates available online that are great guides for figuring out the required content.

Brand. Now that you have a well thought out plan, it is time to start your execution. This is a big part of creating a lucrative business. Branding not only consist of a catchy name and logo, but also establishing a significant and distinguishing presence within a market. So in additional to finding that niche and giving your business that perfectly bold, unique and impactful name, you will need to ensure that representation of the brand remains consistent. Another part of developing a brand is networking. It is crucial that the brand gets proper exposure. With those ingredients you can create a brand/name recognition, which is essential to the success of any business.

Build. Last but not least continue to build your business by being persistent and dedication. Be Strong, Be Vigilante, Be Focused!

Be sure to email Jaeblog@gmail.com if you would like for your small business to be featured on our blog. We want to share the success of others and hopefully inspire more to take the wheel of their financial freedom.

Check in next week for my discussion on every one’s favorite thing; STUDENT LOANS! *insert sarcasm* Let’s talk about how we can manage our debt instead of allowing it to manage us.

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