Exit Strategies for Small Businesses

An exit strategy is a vital component of running a small business. Basically, an exit strategy specifies what to do when the owner leaves or closes down the business. Investors particularly seek to finance small businesses with exit strategies. At CBS Corporate Business Solutions, we help small to medium sized businesses strategically plan for an exit or a shutdown. Here are several exit strategies you can plan for with our experts:

Liquidation – Most small business owners have heard of this particular strategy. Liquidation occurs when a business is shuttered and all assets are sold off. Liquidation is the only sensible exit strategy for very small businesses with a single owner or employee. If liquidation is the exit strategy a business owner is thinking of, then some retooling might be in order to make the business more appealing to a buyer.

Choose a Family Successor – Some business owners simply want to quit. In this case, liquidating the company may not be necessary. Companies can be passed down to a family member. The former owner can continue to get involved in the company afterward, or disengage completely. Passing down a venture to a member of the family is a straightforward process. But it has to be planned in advance.

Sell Company to Employees – Rather than selling the company to outsiders, owners can choose to sell the company to managers or employees to ensure continuous operation. Owners may be allowed to keep a share if desired. However, owners must brace themselves for potential controversies that might arise from the change in management structure.

IPO – The popular IPO is a form of exit strategy. We do not recommend this option for all companies. However, conducting an IPO and going public can be enormously profitable for some companies. To be successful, an IPO has to be structured well because there are numerous compliance regulations to follow.

The above are only a handful of exit strategies for small businesses. Contact us at CBS-CBS.com to discuss other options available and the kind of exit strategy that might be best suited for your business.

IRS Audit Warnings for Startup or Small Business Owners

The IRS is now capable of identifying factors that lead to audits more than ever, thanks largely to improved detection systems. If you run a startup or a small business, you may be singled out for several reasons. Corporate Business Solutions can provide, through one of our affiliated companies, tax assistance to entrepreneurs who have failed to put the proper systems in place to keep the owner’s personal expenses separate from the funds for the business. We highly recommend owners of small and medium-size businesses establish the necessary internal controls and systems to avoid getting in trouble with the IRS.  Here are some red flags for business owners to keep in mind to avoid getting audited by the IRS:

Self Employment – Being self-employed at your own startup or small venture naturally raises red flags at the IRS. Self-employed persons may file for more deductions for businesses, which attracts scrutiny. One of the prime triggers for IRS audits is owning a home where you take a home office deduction for running a business and claiming significant business expenses which may not be justified. If you are self-employed, you must keep business and personal expenses separate without exceptions.

Over-the-Top Home Office Deductions – Be careful about what you deduct as business expenses when you run a home office. Don’t try to claim deductions for very small expenses like paper supplies or buying a new stapler, for example, if you are using those items for your personal convenience as well. Only those things which are exclusively used for your business qualify for a business expense deduction. Home office deductions must be well justified. The IRS will want to know whether the home office is used exclusively for work and has specific rules for when the space allocated for a home office as a percentage of the home cost can be deducted. Keeping extra careful track of all business expenses will help you present strong evidence.

Writing off Hobby Expenses as Business Expenses – It is illegal to pass off a hobby as a business for tax purposes. However, some people may engage in hobbies as if they are businesses. If your hobby business is largely unprofitable, that would ring off warning alarms at the IRS. Your hobby could get classified as unprofitable home businesses, where you cannot claim certain business deductions.

Excessive Generosity – It’s common for even small businesses to make charitable donations and claim a tax credit. However, eyebrows will be raised at the IRS if you are particularly generous in one year more than in others. Do not inflate your charitable donations.  You must have documentation for all charitable deductions.  If you donate more than $500, you must file a form 8283.

You can find more information about the business consulting services we provide at CBS-CBS.com.

Getting a Small Business Valuation

Small business owners often do not have any reliable way to determine how much their company is worth. There is always a ceiling for valuations, but the number is important for tax purposes, investments, and estate planning and inheritance situations.

Business valuation involves getting an assessment of finances and intellectual property a company owns. Calculating how much a small business is worth can be tricky. Most small business owners try to come up with an estimate on their own, only to find out that the processes involved can be complicated and unreliable. But there can be a method to madness. You can hire an expert evaluator, like the professionals working at Corporate Business Solutions. In addition, it’s worthwhile to know that the business valuations involve the following:

Recreate Costing – One of the popular tools used to value businesses is this method called cost recreation. This involves sit calculating all costs it would take another person to start the owner’s business. Costs will be replicated for marketing, buying inventory, office rent or lease and hiring staff. This method is relatively easy to do, but it is not necessarily scientifically accurate.

Market Comparison – A more investor-friendly approach is the “market principle” method, where a company is valued based on how much other companies of similar size and capacity are worth based on numerical figures. For example, if a business twice the size of yours sold for a million in the market, you can value your company based on that.

Multiplying Earnings – This method values businesses based on current and future earnings. If you expect your profits to increase, you can value your business by taking into account future expected increase in earnings.

Business valuations can be complicated for small businesses and should be done by a certified business valuation expert with the proper valuation credentials recognized by the industry. We highly recommend hiring professionals to get an accurate valuation of your business who have the proper credentials. The pros at CBS Corporate Business Solutions can help your small business obtain a valuation that investors can trust.

Grants for Women Entrepreneurs

The consultants at Corporate Business Solutions help the owners of small and medium – size businesses find their path to success.  We know that the rate of women entrepreneurs is growing rapidly, and we also realize that many business owners consider private grants as viable sources to assist with business growth.

Locating information can be half the battle, so we have listed information below on ten private grants especially for women entrepreneurs:

  1. The Eileen Fisher Women-Owned Business Grant Program: Five grants are awarded annually. The businesses must be 100 percent women-owned and have founding principles of social consciousness, sustainability, and innovation, plus be ready to move to the next phase of development. In 2014, the program awarded $125,000 in grants.
  2. Huggies Brand — Mom Inspired Grants: The grant awards up to $15,000 to advance the development of innovative products inspired by the joys of motherhood. The awardees also receive resources to further develop their products and startup businesses.
  3. FedEx Think Bigger — Small Business Grant Program: Applicants are encouraged to share their visions to receive a portion of the $75,000 awarded in grants. Part of the judging involves the general public voting for the finalists, so participants may promote their businesses while garnering votes.
  4. Idea Café Small Business Grant: The Idea Café is a free gateway that hosts different grants on its site. Its current grant is the 16th Small Business Cash Grant, which awards one $1,000 grand prize to a business with the most innovative idea.
  5. Chase Google — Mission Main Street Project: Chase and Google have partnered to award $3 million in grants. In recent years, recipients were awarded $150,000 to help take their businesses to the next level. Recipients also received a trip to Google headquarters, a Google Chromebook laptop and a $2,000 coupon toward a market research study with Google Consumer Surveys.
  6. Small Business Innovation Research (SBIR): Eleven different federal agencies participate in this awards-based program, which incentivizes and enables small businesses to explore their technological potential.
  7. Small Business Technology Transfer Program (STTR): The STTR program reserves a specific percentage of federal research and development funding to provide funding opportunities in research and development.
  8. Women Veteran Entrepreneur Corp (WVEC) Small Business Competition: This competition, organized by Capitol One and Count Me In for Women’s Economic Independence, allows participants to present two-minute pitches for a chance to participate in a nine-month business accelerator program.
  9. Wal-Mart Women’s Economic Empowerment Initiative (WEE): As part of a huge Wal-Mart initiative, sourcing opportunities for U.S. and international companies will increase to $40 billion over five years.
  10. Zions Bank — Smart Women Smart Money: This Utah-based bank’s grant annually awards $3,000 across six different categories, including business.

To learn more about us and / or to schedule your appointment with the business experts at Corporate Business Solutions, call us today at 877-357-9366.

5 Tips to Grow Your Small Business

Corporate Business Solutions was formed by a group of business professionals who collectively have provided business analytical and consulting services to clients. Currently, the experts at Corporate Business Solutions use their expertise to help business owners create a path to success.

If you are looking to grow your business, here are general business tips that may be beneficial to you:

  1. Reduce and Redirect IT. Most businesses carry too much in their IT infrastructure. Often, IT costs can be reduces by up to 30% by investing in advancing technologies to work smarter. By embracing technology, small business owners can free up part of the budget for business growth.
  2. Offer Employees Freedom. Empowered employees are typically happier, loyal and motivated, which will help in your business growth. Today’s employers need to build environments to accommodate a healthy work-life balance. Telecommuting, work from home options and flexible hours are no longer ‘job perks’, they are now ‘expected’. Employees should be able to work and be managed effectively from anywhere as seamlessly as if they were in the office.
  3. Allow Collaborative Working. Enable employees, partners and vender’s across multiple locations to work together more effectively. Employees should be able to access, share and manage single versions of documents instantly from a single place, regardless of their location. Getting this right will transform the efficiency and creativity of your business and create even better partner, and customer working relationships.
  4. Support Customers. Consumers today often want information to solve their problems instantly. That’s why it’s important for businesses to engage with customers proactively across all available channels – from traditional phone and face-to-face discussion, to interactive websites, social networking and intelligent call handling. Businesses must be agile and sharp enough to deal with issues before the customer has a chance to even pick up the phone.
  5. Be Ready to Adapt. With the evolving trends in business, a small business owner must be able to swiftly adapt. This means listening to customers and be ready to participate in the new channels they are using.

To learn more about us and / or to schedule your complimentary appointment with the business consultants at Corporate Business Solutions, call us at 877-357-9366.

 

Dare to explore.

Blogging Tips from Corporate Business Solutions

Corporate Business Solutions helps business owners implement marketing techniques that are critical in growing their business, and can help with the popular tactic of blogging. Blogging is a long-term, on-going marketing strategy that supplements and grounds other marketing campaigns over the life of a small business. It takes time to develop a reputation as an authority in your area of expertise and even longer to develop the loyal following that triggers purchasing. Visualize the arena in which you would like to establish your small business as a market leader and trusted authority; then brainstorm a variety of topics that would showcase that expertise.

These blogging tips can help small business owners improve their blogs:

  1.  Skip the sales approach – The surest way to develop trust and long-term loyalty is a selfless and generous approach that shows authentic interest and consideration for the needs of the reader. Focus on blog topics that help your audience in some specific, actionable way. Blogging is not an opportunity to sell yourself or make constant pitches to your customer base to drive sales. Blogging serves as a way to develop a personality and conversation with your market that allows them to explore their relationship with you without the pressure of purchasing.
  • Listen – Take time to consider what your audience is talking about in the social media arena. Aim to identify their needs because you want to help them, not because you want to sell to them.
  • Offer a useful solution – Once you have identified what your readers are asking for, develop a response that answers their question or solves their problems. Generously share tips and tricks, suggestions or experiences solely for the purpose of providing help.

2. Quality is key – Your small business blog is not an area in your marketing strategy where you can skimp. In a world where content is virtually endless, readers demand captivating, high quality content that consistently respects their expectation for purposeful writing.

  • High quality images – Many bloggers make the mistake of treating blog images as placeholders instead of storytellers. In the sea of available content, readers are visually drawn to the most captivating images. Use high resolution, appropriately composed images that highlight your writing and work collaboratively to deliver relevant information to your audience.
  • Proof –Be sure to implement editing and review processes and outsource writing if it is not a best fit within your team. Poor grammar and sentence structure can frustrate readers and send the wrong message about your attention to detail.
  • Useful topics – Regularly check your editorial calendar to be sure your topics are truly useful and relevant.

3. Engage your readers – Every blog post should have a very specific “call to action” for your reader. If your blog post is properly meeting a need to a question your audience is asking, the call to action should provide specific steps to achieving that resolution on their own. 

  • Submissions – Ask your audience to engage by submitting a story or image that relates to your blog post. Ask them a specific question that you’d like them to answer in the comments or take a poll. Bring them into the conversation.
  • How to’s – Readers are instantly drawn to a step-by-step guide to answering their question. Use images and numbered steps to clearly demonstrate how they can apply this newly learned skill with relative ease.
  • Resource links – Include related links that propel readers to similar content on your blog. Encourage them to read more than just one post by planting seeds to other resources on your website.

To learn more and / or to schedule your complimentary appointment with the experts at Corporate Business Solutions, call us at 877-357-9366.

Get there first.

Common Business Mistakes to Avoid

At Corporate Business Solutions, we are committed to bringing the positive change that your business needs to have sustainable growth and profits.  This often means building relationships with customers, adding technological avenues and getting products quickly to market. Ultimately, we are committed to being the most impactful partner you will ever have.

Since small business owners often wear so many hats, mistakes can arise. However, mistakes in managing and operating a business can threaten the organization’s long-term viability. Consequently, it’s important to identify the organizational priorities never to overlook or neglect.

  1. Unclear Purpose– Every organization must articulate why it exists and what it’s striving to achieve. Owners must focus time and attention on developing a mission and vision.
  2. No Plan – Developing a strategy and having a plan to achieve objectives are critical to any organization’s success. Large or small, every business needs a plan.
  3. No Written Goals – The business must develop goals by writing them down and assigning accountability to someone for achieving them. Each goal should have an identified employee who is responsible for achieving it within a defined timeline.
  4. No Budget – It’s not uncommon for businesses to operate without a budget. However, this is a mistake. To ensure profitability, the owner must budget annually to continuously fund business strategies and goals while controlling costs.
  5. No Employee Accountability– Organizations that fail to hold employees accountable for job responsibilities and goal achievement are guilty of mismanaging resources. Employees who are paid wages or a salary without fulfilling job responsibilities are providing lesser value to the business.
  6. Not Anticipating Market Changes– The market changes quickly in every industry making it important to keep an eye on shifting trends in areas such as technology or customer requirements. Along with tracking changes, the owner has to include the responsibility of day -to-day operational tasks.
  7. Not Understanding Customers– Small businesses need to take the time to learn how customers use their products and services and to create systems and processes to meet those needs. It’s important to learn about the customer experience, which can be accomplished by simply asking them.
  8. Lack of Communication Successful organizations create structured processes to manage how information is shared with both employees and customers. Organizational transparency creates a business environment that employees enjoy and customers are drawn to.
  9. Not Always Looking for Ways to Improve– Continuous improvement are how businesses develop and enhance products and services by constantly looking for ways to improve how and what they do.
  10. Not Celebrating Successes – The burden of the daily grind keeps businesses from taking the time to stop and acknowledge how far they’ve come. Celebrating success along the way helps build strong teams and strengthen employee engagement.

To learn more and / or to schedule your complimentary appointment with the experts at Corporate Business Solutions, call us at 877-357-9366.

Like your reflection.

Improving Productivity in the Small Business Workplace

The business professionals at Corporate Business Solutions help business leaders improve productivity in their workplace. Our experts recognize that productivity is a huge factor for business growth and expansion. In fact, between employee attrition and lost productivity, companies lose $350 billion every year. Facing that kind of loss, it’s no surprise that all-size companies look for ways to mitigate employee flight and increase worker efficiency.

Many business owners trust us to be their partners in improving productivity. Our business consultants solve the most intricate and unique challenges you are experiencing in the evolving marketplace.  While there are best practices that are applicable to all organizations, we understand that no two businesses are identical.

If you are a business owner or leader concerned on productivity, here is some data you may be interested in:

  • Worker Reliability: Employee attrition is costly; only 50 percent of hourly workers stay on the job for one year or longer.
  • Telecommuting Employees: Work-at-home employees stay at on the job 20 percent longer than employees with the shortest amount of time at a job. However, those work-at-home employees produce 1.6 percent less than their office-bound colleagues.
  • Rule Breakers: Do you prefer to hire employees who toe the line? The data says that employees who identify as rule-followers actually break the rules 67 percent more often than those who don’t make that claim.
  • Better Browsers: Workers who use Chrome or Firefox—instead of Internet Explorer—stay at their jobs longer, miss 15 percent fewer work days, and deliver higher customer satisfaction.
  • Social Employees Do It Better: Job performance is higher among employees who use three to four social networks compared to those who are less involved with social networks.

To learn more and / or to schedule your complimentary appointment with the experts at Corporate Business Solutions, call us at 877-357-9366.

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Tips for Hiring New Team Members

Corporate Business Solutions was formed by a group of business professionals who collectively have provided business analytical and consulting services to thousands of clients and have been involved in building some of the fastest growing analytical, management consulting and strategic tax planning firms for the owners of small and mid-size companies in business today.

We assist entrepreneurs in all aspects of their business, including hiring new employees.  If you are a business owner beginning your own hiring process, we have tips for you from our professionals:

  1. Focus on the candidate’s potential. Nothing is more important in a new hire than personality. While having the right skill set may seem essential, the fact is, skills can be acquired, but personalities cannot.
  2. Check social media profiles. Most employers do a background check, including a quick Google search on the candidate’s name, to see what is shown online. Today, we suggest looking at social media profiles to evaluate their online presence even further.
  3. Ask the right questions. In advance, determine questions that will help you decipher a candidate’s drive and ambition. This will help you understand how the person works, and whether or not your prospective employee will grow with your business.
  4. Let candidates ask questions. To help gauge whether your prospective candidate has the right personality for your particular job, it’s important to help that person understand the company’s work environment. Allowing prospective employees to interview you for a change will give you a chance to see what’s important to them.
  5. Don’t judge a book by its cover. It’s easy to write off candidates based on their appearance, but it’s more important that you consider how well they can do the job and if they’re a good fit in other ways. When interviewing, it is important to think outside the box. Candidates who fall outside the lines of your requirements may still be the perfect fit for your business.

To learn more and / or to schedule your complimentary appointment with the experts at Corporate Business Solutions, call us at 877-357-9366.