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Strategies for Growing Wealth for your Small Business

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By James Pruitt, Senior Staff Writer

Often, business owners find themselves in the midst of a crazy business idea that promises to become their bread and butter. Has your dream come true? The last thing you need at this point is to throw practicality out the window. The first success may be only the start of a crazy growth spurt. Depending on the business itself and your own ambitions, the following considerations may grow your idea into a cash cow.

1) Know your Priorities. . . Budget, budget, budget!

Office supplies and equipment and maintenance can really dribble the resources of a Veteran Business Owner. Business owners should never be pennywise and pound foolish.  Profits don’t come from penny-pinching, 

You know your business better than anyone else. Over the long term, Veteran Business Owners should balance their plans with their resources.

For a successful business, the best profit margins should more than compensate for the overhead. Seek good deals. The tastiest ice cream should more than compensate for the glitter on the cone.

2)  Understand that Money should Make Money

Stagnant money does no one favors. Various resources can provide business owners with the seeds to grow their investments into a harvest that may yield fruit.

Occasionally, a bright idea may pop up in the news that sprouts and sheds its spores. Business owners should consider these situations case-by-case. However, in general, secure investments do the best service for Veteran Business Owners.

The best investment is yourself, and your knowledge and understanding of your own idea. Outside of their own considerations for their own business ideas, business owners need to maintain some sort of corporate veil between their own ambitions and those of their company.

Corporate bank accounts can yield dividends, but business owners should give thought to any opening capital until that money is ready to blossom into the Veteran Business Owner’s dream.

3) Diversify

When a business owner has capital, careful education should guide the management of that wealth. For example, many people confuse stocks and bonds. Bonds are essentially documents issued by corporations and governments that issue certificates that increase in value at a fixed rate. Stocks entail ownership of a share of the company. Bonds generally bank on the security of the issuing body, whether governmental or private. Stocks require care and confidence, and generally function best in a portfolio long-term, after careful contemplation. The health of the company matters. Also, consider the health and future of the industry.  

Also, consider your own resources. Do you own real property? Real estate can be rented, assets can be sold. As for yourself, as long as you have a place to live, consider all options. 

4) Stay in Control

Keep in mind your own “money story.” Business owners should know that they know their own story better than anyone else. Profit often matters more than cash flow. Assuming humble beginnings, strong incoming revenue indicates a healthy company. On the other hand, a large investment requires even greater incoming cash to make the company successful. 

Legally, remember that you are always the master of your own estate. No one can take that control away from you. Veterans should seek counsel in any situation that challenges their feelings about how to manage their money.

VAMBOA, the Veterans and Military Business Owners Association hope that this article has not only been valuable but provided some unique perspective.  We work hard to bring you important, positive, helpful, and timely information and are the “go-to” online venue for Veteran and Military Business Owners.  VAMBOA is a non-profit trade association.   We do not charge members any dues or fees and members can also use our seal on their collateral and website.   If you are not yet a member, you can register here:  

https://vamboa.org/member-registration/

We also invite you to check us out on social media too.

Facebook:  https://www.facebook.com/vamboa

Twitter:  https://twitter.com/VAMBOA

Do not forget that VAMBOA members receive significant discounts on technology needs.   Check them out here: https://vamboa.org/dell-technologies/ 

 

Productivity Strategies for Small Businesses

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By James Pruitt, Senior Staff Writer

To stay effective, businesses need to investigate methods to streamline operations. Various techniques save time and energy when getting your company or organization above ground. These include organizational methods to streamline project management, information retrieval, employee communication, and decision-making processes.

1) Project Management:

Business cycles rarely flow with perfect routines and without bumps in the road. At times, seasonal cycles control the ebb and flow of resources of even the most stable businesses.  As a result, skillful project management must tackle the unpredictable trials that break the rhythms of even the most stable institutions.

In some cases, the same project rolls around each year. In these cases, project management systems can facilitate review and record-keeping. Applications like Asana can help create plans for these periodic bumps in the road, facilitating the delegation and simplification of tasks.

In other cases, a specific circumstance may arise, and a company has a new dragon to slay. In order to tackle such unforeseeable bumps in the road, organizations should retain the flexibility to mobilize. Cross-training can help employees take on diverse tasks within the company as needed. Also, keeping business operations flexible may allow wiggle-room for novel situations as they arise.

2) Good Information Management and Storage, aka a Good Filing System:

Even before the age of computers, any secretary could describe the benefits of a good filing system. Effective companies need to stay organized. Lost documents and jumbled service can destroy a company’s reputation. 

Applications like Airtable can help organize various documents and spreadsheets. Online applications can supplement well-thought-out systems within the office to ensure information is stored effectively and retrievably.

3) Employee Feedback and Communication:

The workers on the front lines are often the first to know when the first hits arise of a dire new issue. Worker feedback is essential. Proprietary software should include space for comments by operators, and management should take these comments seriously. Open-door policies should allow the rank-and-file to raise issues when appropriate. 

Companies should stay vertically integrated to ensure that the leadership and the rank-and-file stay on the same page. This way, problems are less likely to snowball before they reach the attention of management. Applications like Dropbox can ensure communication between various members of the team.

4) Decision Making: Streamlined Approval for New Initiatives:

How can we define “bureaucracy?” Sometimes, layers of middle management calcify into a concrete wall between innovation and leadership. Hence, skillful oversight protects businesses from careless decisions. Approval processes must be strict, quick, and effective.

A calcified bureaucracy in a large organization can stymie the best-laid plans. Careful scrutiny of processes ensures that only the best products and services go to market. Smaller organizations often struggle to maintain quality in the face of limited resources. Given restrictions in size and resources, the problem for Veteran Business Owners often is not bureaucracy, but lack of oversight.

Several workflow applications, such as Shift, can channel tasks to employees’ inboxes. Such applications can allow workers to arrive in the morning ready to tackle their workload independently.

Overall, productivity strategies should vary with the type of organization. However, the above four considerations can guide management across industries in both the for-profit and non-profit sectors. In other words, both newfangled technological approaches and old-fashion office management techniques can help prune time-wasting redundancies from a Veteran Business Owner’s workday.

 

VAMBOA, the Veterans and Military Business Owners Association hope that this article has not only been valuable but provided some unique perspective.  We work hard to bring you important, positive, helpful, and timely information and are the “go-to” online venue for Veteran and Military Business Owners.  VAMBOA is a non-profit trade association.   We do not charge members any dues or fees and members can also use our seal on their collateral and website.   If you are not yet a member, you can register here:  

https://vamboa.org/member-registration/

We also invite you to check us out on social media too.

Facebook:  https://www.facebook.com/vamboa

Twitter:  https://twitter.com/VAMBOA

Do not forget that VAMBOA members receive significant discounts on technology needs.   Check them out here: https://vamboa.org/dell-technologies/ 

 

CROWDFUNDING

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By James Pruitt, Senior Staff Writer

Crowdsourcing is a relatively new phenomenon and an alternative to angel investors. Many find crowdsourcing campaigns obnoxious. However, crowdsourcing websites provide an invaluable resource for new businesses. 

Additionally, over time, investment crowdsourcing has evolved to cater to the needs of new businesses. When a new business resorts to traditional crowdsourcing sites, a better way to describe these campaigns is presales campaigns. Such campaigns are as old as capitalism.

Angel investors are harder to come by. Angel investors are usually at the later stages of successful business ventures and take satisfaction from boosting new ideas. Such investors generally ask in exchange for a share of the business equity or convertible debt. Oftentimes, a mentorship or patronage relationship comes with the package.

The earliest crowdsourcing campaigns were shameless attempts to score frivolous rewards for brazen internauts seeking consumer goods, vacations, and other vanities. Later, crowdsourcing sites became known for charity fundraising. Now, crowdsourcing sites such as gofundme.com and kickstarter.com have found new life in promoting novel business ventures.

We should all welcome the repurposing of these established websites. Anyone can use these platforms to market their business idea. These sites offer great springboards for presales marketing. Angel investors are harder to come by and offer different risks and benefits.

A distinction should be made between regular crowdfunding and investment crowdfunding. Most crowdfunding provides nothing but the satisfaction of help for another. Investment crowdfunding provides an equity interest in the company. In other words, the funders receive a tiny share of ownership of the company commensurate with their investment. SeedInvest and FundersClub are popular forums for investment crowdfunding.

“Angel investors” are few and far between. Such investors often show an emotional interest in the enterprise beyond the fiscal rewards, yet generally do expect compensation. Online resources do exist for those seeking angel investors. The Angel Capital Association provides a forum for well-meaning senior investors seeking promising candidates. Gust and the Angel Forum also facilitate meetups between entrepreneurs and angel mentors. In general, such relationships are quite hard to come by. Successful relationships with angel investors tend to be serendipitous and start with lucrative personal connections before they bear any kind of fruit.

As for crowdfunding, the idea itself must be a crowd-pleaser. Hence, the idea itself provides a great exercise in marketing in its early stages. Legitimate early-stage crowdfunding generally needs good marketing material. In other words, the business concept should have developed to the point where it can attract interest. A crowdfunding endeavor may also provide an exercise in business development. 

In sum, “angel investors” are often a matter of luck. They can provide vast resources but may usurp control. “Crowdfunding campaigns” generally require the preparation of a palatable business idea. As for crowdfunding, an understanding of the different types of crowdfunding can set new business owners on a good track for funding their new enterprise. At the same time, bear in mind that most of the funding for new business ideas comes from independent “bootstrap” money. A balanced, well-researched understanding of all three can provide a realistic assessment of funding potential at the earliest stages.

VAMBOA, the Veterans and Military Business Owners Association hope that this article has not only been valuable but provided some unique perspective.  We work hard to bring you important, positive, helpful, and timely information and are the “go-to” online venue for Veteran and Military Business Owners.  VAMBOA is a non-profit trade association.   We do not charge members any dues or fees and members can also use our seal on their collateral and website.   If you are not yet a member, you can register here:  

https://vamboa.org/member-registration/

We also invite you to check us out on social media too.

Facebook:  https://www.facebook.com/vamboa

Twitter:  https://twitter.com/VAMBOA

Do not forget that VAMBOA members receive significant discounts on technology needs.   Check them out here: https://vamboa.org/dell-technologies/ 

depreciation

 

By James Pruitt, Senior Staff Writer

What is Depreciation, and How Can I Benefit from it?

Any new item in a business’s repertoire likely depreciates over time. Owners may write off this decline in value during tax season. Also, services and other intangibles may qualify as tax deductions.

For example, vehicles, equipment, and buildings inevitably require maintenance, as well as accounting for any loss of value. These assets may endure wear and tear during the early stages of your business. Guess what? Both the maintenance costs and the loss of value may qualify business owners for a tax write-off.

Oil changes, paint jobs, and worn-out parts can reduce your tax liability. Similarly, loss in inherent value can relieve proprietors come tax season.

Methods for Calculating Depreciation

The straight-line method is the most common way to calculate depreciating resources. This method simply divides the initial cost of an asset by its years of useful life. This asset may be a vehicle, a piece of equipment, or a piece of real property.

Other methods of calculation may fit different circumstances. Variables such as “useful life” and “value” may not always calculate simply, based on the nature of the asset.

Many calculation methods other than straight-line depreciation can reduce a veteran entrepreneur’s tax burden.

  • Sum-of-Year’s-Digits (SYD) Depreciation

The Sum-of-Year’s method accounts for the salvage value of an asset. This method is complex, and business owners should apply this method to their taxes only very cautiously.

  • Units of Production Method

This method accounts for the wear-and-tear of a piece of equipment. Essentially, this accounting practice considers the productivity of a piece of equipment. The depreciation of the equipment depends on the quantity of resulting product.

  • Declining Balance Depreciation

Consider the cliché that a car loses much of its value after leaving the dealer’s lot. This method allows users to subtract most of an asset’s value during the first few years of use. After this period, often the depreciation of an asset flattens. However, the largest tax breaks for depreciation may come early on.

  • Double Declining Balance Depreciation

This method is a hybrid. Generally, this method combines straight-line depreciation with declining balance depreciation. Usually, business owners use this method for equipment with a short useful life.

  • Straight-Line Depreciation

The straight-line method is by far the most common method for calculating depreciation. Most small business owners use this method. This method of depreciation even reduces to a simple formula: (asset cost – salvage value) / useful life in years = annual depreciation.

Which Method to Use?

The straight-line method provides the best calculation method for the majority of small businessowners. However, the relevant variables themselves may not always seem readily apparent. How do we calculate, for example, “asset cost,” “salvage value,” or “useful life in years?”

Consider a small business that manufactures t-shirts. Imagine an embroidering machine. Perhaps the “units of production method” may provide a more useful method come tax season to gain that useful write-off. Lacking sophisticated expertise in gauging the declining value of this piece of equipment, a small business owner could legitimately resort to calculating the deterioration of the machine by the number of t-shirts produced.

Bottom Line

The straight-line method provides by far the most common method of calculating depreciation. However, straight-line depreciation is not always practical.  Variables such as “asset cost,” “salvage value,” and useful life in years” may themselves present difficulties. These values may depend on the type of equipment and the nature of the business. The owner’s discretion inevitably provides the best fit for the optimal tax and accounting methods.

VAMBOA, the Veterans and Military Business Owners Association hopes that this article on Depreciation has been valuable.   We work hard to bring you important, positive, helpful, and timely information and are the “go to” online venue for Veteran and Military Business Owners.  VAMBOA is a non-profit trade association.   We do not charge members any dues or fees and members can also use our seal on their collateral and website.   If you are not yet a member, you can register here:

https://vamboa.org/member-registration/

We also invite you to check us out on social media too.

Facebook:  https://www.facebook.com/vamboa

Twitter:  https://twitter.com/VAMBOA

Don’t forget that VAMBOA members receive significant discounts on technology needs.   Check them out here:

https://vamboa.org/dell-technologies/

 

By Debbie Gregory.

LinkedIN Debbie Gregory VAMBOA VAMBOA Facebook VAMBOA Twitter

 

VAMBOA and our team hopes that you have enjoyed Part 1 and Part 2 of this three-part series on Business Grants for Veterans and found it to be valuable.   Please let us know what you think because we value your input.  You can email us at info@vamboa.org.

 

Once you have your funding secured, either by grant or loan, you may still need some other business assistance. Below you can find some excellent resources for your Small Veteran Owned Business to utilize to start, learn, nurture, and grow your small business:

  • Boots to Business is a two-step program offered by the Small Business Administration (the SBA) offered on military installations around the world to introduce service members to entrepreneurship and the foundations needed to begin a business when they return home.
  • Entrepreneurship Bootcamp for Veterans (EBV)is a free program for post-9/11 vets and their spouses.
  • Patriot Boot Camp is a branch of the startup incubator: TechStars and is specifically for active duty military members and their spouses who want to gain entrepreneurial skills.
  • Service-Disabled Entrepreneurship Development Training Program offers between $50,000 and $150,000 as a grant to support organizations that deliver entrepreneurship training program(s) to service-disabled veteran entrepreneurs who want to become small business owners or who currently own a small business.
  • Small Business Administration (SBA) offers several veteran entrepreneurship training programs.
  • Veteran Women Igniting the Spirit of Entrepreneurship (V-WISE) is an SBA-funded program that offers online training, a conference and mentorship specifically to female veterans.
  • Veterans Business Services helps veterans acquire or start small business. Veteran Business Services offers assistance with franchising, marketing and with connecting you with financial services.
  • Veterans Business Resource Center offers business training for Veterans including help with understanding business plans, financials, marketing, sales, human resource management, and more. They also offer webinars and professional counseling.
  • Veterans Institute for Procurement (VIP)is an accelerator program with three specific offerings specifically designed for owners, principals, and C‐level executives of Veteran Owned Small Businesses and Service-Disabled Veteran Owned Small Businesses SDVOSB).  Veterans Institute for Procurement (VIP) Grow helps companies develop overall strategies to operate and expand within the federal marketplace. VIP Start helps companies that want to get into the federal market and become procurement-ready. VIP International is for companies that want to enter or expand their federal and commercial contracting opportunities overseas.
  • VetsInTechis a private sector training program that offers tech related education opportunities, connections with tech jobs and workshops and bootcamps to help veteran startup founders boost and grow their businesses.

 

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