As a business owner, there are few moments as exciting as closing a big contract, especially after a long sales process. To make sure the customer is satisfied, you take special precautions to ensure that their order is prepared to exacting standards, checking every detail three times. You also draw down on your line of credit to purchase the raw materials to execute the order. You then have your employees work overtime to make sure the first shipment goes out early. You appear to have … [Read more...]
Don’t Miss this 2010 Tax Credit for Healthcare Spending
Most people in the United States receive health insurance coverage through their employers. As the Patient Protection and Affordable Care Act (healthcare reform law) is implemented over the next five years, business owners will need to carefully analyze how the law impacts the coverage they offer (or don’t offer) employees. Some changes, such as the 2010 heath care spending tax credit, are already active. The 2010 Small Business Tax Credit for Healthcare for Small Employers The … [Read more...]
Is a Value-Added Tax Heading Our Way?
There is a great deal of buzz starting to generate around the “value-added tax” (or VAT). The concept of a VAT was first proposed by Wilhelm von Siemens, son of the founder of Siemens in 1918. The first country to implement a value-added tax was France in 1954. Today, nearly 100 countries have a VAT. The U.S., so far, is not among the list. But that may change soon. Many experts are arriving at the conclusion that income tax increases and spending reductions alone will not be enough to … [Read more...]
Evaluate Your Business Like Warren Buffett Would
"Accounting is the language of business, and you have to learn it like a language… To be successful at business, you have to understand the underlying financial values of the business." –Warren Buffett Warren Buffett is the most successful investor in the world because he knows that great companies make great investments. Identifying great companies requires an understanding of accounting and the ability to read and interpret the basic financial statements: the income statement, balance … [Read more...]
Using Loss Leaders in Your Pricing Strategy
Common sense tells business owners that the way to make money is to sell products for more than it costs to make them. But like any rule, there are exceptions. Loss leader pricing is one of them. This strategy prices a specific product at an extremely attractive price, one that may not even cover the cost of goods sold for the seller. The expectation is that buyers of the loss leader product will also purchase additional goods and services where the business will make a healthy profit. The … [Read more...]
How to Use Your IRA to Fund Your Business
If you own a business or are thinking of starting one, raising capital continues to be key challenge. Lending requirements remain stringent, home equity is no longer a quick source of cash and equity investors continue to be very selective. At the same time, the Investment Company Institute, the national association of investment companies, estimates that there are over $4.2 trillion in assets being held in Individual Retirement Accounts (IRAs). Many business owners and entrepreneurs are … [Read more...]
Take the Risk Out of Your Accounts Receivables
Most business owners that want to grow their companies focus on sales growth. But that’s only half of the solution. You also need to make sure that the customers that buy get around to paying you. Managing accounts receivables is what really makes or breaks a business. Unfortunately the majority of owners don’t spend nearly enough time analyzing accounts receivables to determine how risky they are. Let’s change that. Accounts Receivable Risk Accounts receivable “risk” refers to … [Read more...]
Business declaring bankruptcy Are on the Rise
Businesses have been declaring bankruptcy at an alarming rate over the past several years. According to the American Bankruptcy Institute (ABI), the largest multi-disciplinary, non-partisan organization dedicated to research and education on bankruptcy, 60,837 companies declared bankruptcy in 2009, the largest number since 1993. This represents a 209 percent increase over the 19,695 business bankruptcies declared in 2006. During the first quarter of this year, 14,607 businesses have … [Read more...]
Employee Fraud: Detecting Employee Theft and Occupational Fraud at Your Company
The Association of Certified Fraud Examiners (ACFE), the largest anti-fraud organization in the world with over 50,000 members, recently published the results of its biannual study on occupational fraud (also known as employee fraud). With millions of people facing financial hardship, the odds that someone at your company may steal increases. Reading the report will serve as a wake call to business owners who haven’t actively addressed the issue of employee fraud. Three types of … [Read more...]
1099 Forms: New 1099 Filing Requirements for 2011: Truth Serum or More Red Tape?
For every one dollar in federal income taxes owed, the IRS is only able to collect 84 cents. The missing 16 cents is called the tax gap. New 1099 Filing Requirements for 2011 It’s the difference between what individuals and businesses should pay and what they actually do pay. After adjusting for late payments and enforcement actions by the IRS, the “net tax gap” is estimated to be approximately $290 billion a year. With the federal budget suffering from massive deficits, closing the net … [Read more...]