The US Small Business Administration shares How to Estimate the Cost of Starting a Business from Scratch.
Start-up costs are technically defined as the costs you’ll incur before you start making any income. It’s an important distinction to make because it will impact your tax return. These costs are broken down as follows:
1. Expenses – These are the costs involved in preparing to open a business and may include things like market research, the mileage costs involved in researching a location, advertising, training, wages, and any fees paid to professionals or consultants such as a lawyer or accountant.
Many (but not all) of these costs are tax deductible, up to $5,000 in the first year of doing business. The remaining costs are then amortized (meaning you deduct them in equal installments) over a period of 180 months (starting with the month in which your business opens).
If you decide not to open a business after doing all your research, the deduction benefit goes away. Instead, these expenses are considered personal costs and aren’t deductible. Read more about the ins and outs of start-up deductions in How to Write Off the Expense of Starting Your Business.
2. Capital Expenditures – You’ll also incur one-time costs to purchase assets such as inventory, property, vehicles,etc. These don’t typically qualify for a deduction, but can be written off through depreciation.
For more tips and strategies read the complete article.
By Caron_Beesley, Contributor
Are You An Entrepreneur? Do you have what it takes?
Not everyone is cut out for the challenge of starting their own business. There are several personality traits that are common among successful entrepreneurs, including discipline, frugality, self-confidence, good communication skills, humility, honesty and integrity, superb record-keeping skills, motivation, good health, optimism and more. For more on these characteristics, read Are You An Entrepreneur?
Create The Concept
Before you quit your job to become an entrepreneur, you must first think of a concept, product or service that will generate a steady stream of income. This may sound easy, but for most people, this is actually the hardest part. You should conceive a plan that puts your knowledge, experience and expertise to use in the most profitable way possible. Once you settle on an idea, research the marketplace to see how similar businesses have fared.
Create A Business Plan
Numerous studies have shown that one of the major reasons new businesses fail is poor planning. If you are planning on starting up a business, you must have a business plan. This will serve as a road map to guide you, and communicate with your bank and/or investors what you’re doing and why they should invest in you. It should include a mission statement, executive summary, product or service offerings, target market, marketing plan, industry and competitive analysis, pro-forma financials, resumes for the company’s principals, your offering, and an appendix with any other pertinent information. For more, read 4 Steps To Creating A Stellar Business Plan.
When you are looking for tips and insight on starting your own business.
Click here for a goodread!
“Start-ups don’t die, they commit suicide. In other words, 90 percent of start-ups fail because the founders get bored, discouraged, or something else, and they move on to other things, not because of some catastrophe. No matter how dark it is today, things will always be better tomorrow.” — Justin Kan, Justin.TV
According to Small Business Trends 2015 companies will make some changes from the past and take a new role in increasing revenue. How many of these changes will you be making?
Less Email, More in Person Meetings
People have opted for email instead of phone calls. But the small business trend this year will be to have more in person meetings with employees, vendors and customers as everyone wants to make true connections that build lasting relationships.
Less Secrecy, More Transparency
With social media instantly communicating and every phone having a camera, nothing in business is a secret any longer. This will force every small business to be much more transparent in dealings with customers, employees and product developments. This will also boost more social responsibility for these companies.
You can check out all of the new trends here!
Naming your business is an important branding exercise, but if you choose to name your business as anything other than your own personal name then you’ll need to register it with the appropriate authorities.
This process is known as registering your “Doing Business As” (DBA) name.
What is a “Doing Business As” Name?
A fictitious name (or assumed name, trade name or DBA name) is a business name that is different from your personal name, the names of your partners or the officially registered name of your LLC or corporation.
It’s important to note that when you form a business, the legal name Continue reading
Knowing that you have a great business idea/product and are ready to obtain crowdfunding for your business start-up, don’t miss this important step; market research.
So what exactly is market research? Simply put, it’s a way of collecting information you can use to solve or avoid marketing problems. Good market research gives you the data you need to develop a marketing plan that really works for you. It enables you to identify the specific segments within a market that you want to target and to create an identity for your product or service that separates it from Continue reading
According to Wordspy.com the earliest recorded use of the word “crowdfunding” was by Michael Sullivan in fundavlog in August of 2006. An early precursor of the crowdfunding business model could be the concept of collective fundraising a subscription business model that was used in the 17th century to finance publications that were planned but not yet printed.
Crowdfunding began to gain traction in the United States after the launch of Artist Share, it was the first online platform for crowdfunding in 2003. Following Artist Share, more crowdfunding sites started to appear. Crowdfunding websites helped companies and individuals worldwide raise $89 million from members of the public in 2010, $1.47 billion in 2011, and $2.66 billion in 2012. In 2012 more than one million individual campaigns were established globally. The industry is projected to grow to $5.1 billion in 2013.
A report in May of 2014 , released by Continue reading
Over the last several years crowdfunding has become an increasingly popular option for both entrepreneurs and investors. According to Forbes, Drew Hendricks, the volume of global crowdfunding platforms skyrocketed. Crowdfunding has already proven itself to be a successful alternative in acquiring or investing money. And it’s likely not going anywhere anytime soon. It will most likely continue to rapidly grow. In fact, crowdfunding is poised to become the next big investment trend. And here’s five reasons why:
Have you ever asked for money? It’s not exactly the highlight of your day. But that’s nothing compared to applying for a loan or meeting with potential investors. It’s one of the most nerve-racking experiences that entrepreneurs have to go through. But, that’s not the case with crowdfunding. Compared to all of the paperwork and preparation needed for loans, setting a crowdfunding campaign is a breeze. Just select the right platform, put together a video and offer enticing rewards. While there’s still a need for something that’s important for the long-term, like a business plan, it’s extremely refreshing to only have to make your presentation and pitch just once. Crowdfunding is also a great for both investors and entrepreneurs to discover each other. Instead of relying on traditional methods and investing options, crowdfunding provides a convenient and exciting way of obtaining an investment or finding a new venture to fund.
- Validates a Concept
Having an idea is one thing. Proving that the idea can make a profit is another thing. Whether you need to convince yourself or investors that there’s money made, crowdfunding provides a great opportunity to see where the market stands. If you launch a successful crowdfunding campaign, it not only Continue reading