Thursday, October 6, 2011

To Start Your Own Business

So you want to venture down that road of self employment?  Well I've been on that highway my entire life and for me there is nothing better than controlling your own destiny!  Here are a few tips that maybe you can use to save some time and also get by those growing pains. A) Start with a good business plan, make sure its feasible as most entrepreneurs have the mindset and great ideas but maybe not have a good business sense.... remember passion doesn't pay the bills!  B) Incorporate your business, it might seem like an added expense but well worth it as it will protect your personal assets,  lower your tax rate, allow you to invest within your own Ltd., pay yourself etc. C)  Have a good accountant as this is paramount in the business world.  They are experts in the tax codes/issues and finances, certainly someone to have on "your" team to save you money.  D) Payroll;  Set it up with your local bank to do it for you with all its deductions to the various government agencies plus do direct deposit for your employees. The cost is minimal compared to the time saved.  E) Be prepared to put in at least 5yrs of long days to get the business up and running, also you'll find that your staff will be your biggest headache (everything from poor work habits, not showing up for their shift, theft etc)  My solution?.....make some of your employees owners, as then they has a vested interest in the business to make it grow. So what you do is through your accountant get a value of your company, so for example we shall say XYZ Ltd. is worth $100,000 and your selling to 3 of your staff 10% each so they individually need to come up with $10,000 to be part owner of XYZ Ltd.  The best way is to take it out of their pay over 5yrs, so believe me they will watch the shop for you lol  (plus you the owner don't give up control because you still have over 51% stake, and don't have to be there all the time so you can concentrate on other things)   The payoff for them is they become owners without any money down and in 5years the value has gone up for all a win/win!!

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