Archive | February 11, 2017

Own A Franchise Financial Conversations To Have With Your Family Before Choosing A Franchise

Guest Blogger: Ray Moore, CFE, Vice President of Development, BrightStar

The successful franchisee will first and foremost find the right fit. The right fit may be the one that best fits his or her financial resources and goals. The potential franchisee should sit down with their spouse and family and ask some hard questions. Together they will have to decide what outcomes they need to realize to consider this venture a success. They will have to separate out the must have or non-negotiable outcomes before shopping for a franchise opportunity.

The couple/family should agree to the following each family will have to fill in the blanks according to their own circumstances. Its a good idea to consult an accountant:

1.We will not invest more than $_____ of our cash/liquid capital.
2.We will not borrow more than $______ in additional funds to capitalize the business.

With any start up, business owners need to have enough money, either set aside or in other income, to cover household bills and run the business for 12 to 18 months. The following questions will help determine how much is needed:

3.To make sure we can still live comfortably while growing the business, we will cut our household budget to $ ____ per month for at least ____ months and be sure to never exceed that budget.
4.We will only buy a franchise that we have confidence can get big enough to feed itself, i.e., income (cash flow) will cover monthly business expenses (fixed and variable costs), no later than ___ months after signing the agreement.

With many new business start ups, the owner will not be able to take a salary for 1-2 years. The family needs to know that household expenses will be covered during that time.

5.We will only seek a franchise for sale that we have confidence will be able to pay me a discretionary salary (enough to cover some or all of household expenses) without harming the business no later than ___ months after signing the agreement.
6.We will generate other income of $___ (amount needed to make up for loss of other income and savings budget) from ___ (spousal income, other household income or investments) independent of the new franchise business.
7.We will only pursue a franchise business opportunity that will allow us to have our initial investment back, i.e., pay off the start up loan from business income, in ____ months/years.

These are just some of the items that typically come up, or should come up, during the conversations leading up to buying a franchise. Asking the right questions will get you the answers you need. Ask them of yourself, your spouse, your family, the franchisor and other franchisees so you can get the full picture of what your life will be like while building your business, and what it can be like once you have established your new franchise.

Ray Moore, CFE, BrightStar

Entrepreneur Success…What Does It Take

An entrepreneur does many wonderful things. In fact, many people are amazed with how the entrepreneur’s mind works. But for some who have not taken the plunge, there is some wonderment….some real curiosity….and for some of us, even some questions about successful entrepreneurs morals and integrity….But for most onlookers there are two important questions to ask. How does an entrepreneur become successful? And most importantly, do you want to be a successful entrepreneur too?

First of all, an effective entrepreneur should have great ideas. And then you need to test those ideas…You have to research to be able to make an informed judgement about whether your business idea is feasible. It really is critical to do this investigation, and in many cases its not necessarily a tedious task…Once you have gathered all the needed information, you can decide whether to pursue the business idea now, or simply file it and do it in the future.

Sound Research

The projects undertaken by successful entrepreneurs are normally done in a very careful manner. Research about Demand is a very important aspect to help determine business feasibility. Saturated and established markets can be a big no for entrepreneurs because their aim is to earn more money. Entering a saturated market can be suicidal (unless you have a very unique selling proposition), because of the extreme competition.

If you want to become a successful entrepreneur, you have to work on some concepts such as ROI or return on investment, compounding capital, economy of scale, speed of business returns, and many others. You can’t work your way to success if you dont know these concepts. So you have to study and continue your learning. If you have the opportunity to study a business related course, do so. Gaining knowledge, skill and education, can only help you to succeed in the business world.

According to many expert entrepreneurs, education is not enough. As an entrepreneur, you must have the right attitude and qualities. Now what are these attitudes and qualities? Firstly, you have to be hard working. You have to be willing to work many hours of the day or night especially if you’re a beginner. Almost eighty percent of your time will be allotted for encouraging customers or subscribers. In the case of an internet business, you have to attract a lot of traffic to your site otherwise, your business will fail.

Secondly, you need to be a risk taker. Most entrepreneurs are not afraid to take risks. This does not mean that entrepreneurs enter the market with their eyes closed hoping for success. Entrepreneurs are willing to take risks especially if after a careful study they can see high chances of success. Not many individuals are willing to take risks because they are afraid to fail. But you see, an entrepreneur learns a lot from past failures. It’s all part of life and so you should not be scared. Its also important to be organized.

Tips To Personal Banking

With the advent of personal banking services, things have become a lot more convenient for people. However, you need to be little cautious in order to safeguard your personal information from any third party.

You can find several banks providing personal banking services. However, it is advisable to follow certain tips while using personal banking that will be helpful to you.

Primarily, it is imperative to begin by ensuring that the right security software is installed on your computer and ensure it is fully updated so that you could get the best personal banking services. This is essential as it will help you to keep viruses away from getting on to your computer. Likewise, it is advisable to keep changing your password at frequent intervals so that nobody else could access to your personal banking account. This would help you as no one else will be able to use your account.

Another point to keep in mind is regularly tracking and checking your transaction records to prevent any unusual activities hampering your peace of mind. Additionally, in case there are certain transactions that you dont remember, you should take immediate action to make sure that that anyone has not committed any kind of identity theft over you.

Furthermore, it is advisable never to access net banking through links in emails. It is also recommended not to enter any confidential information on suspicious websites. You should delete spam emails right away.

Personal banking is reliable, safe and successful if you make sure to remember these tips and safeguard yourself while doing your banking online. There are various types of dangers on the Internet especially when you are dealing with such confidential valuable information. With the help of personal banking services, you do not need to visit your bank each time you need to complete a transaction. The greatest advantage of personal banking is that you can get instant cash from your ATM and you will always have an evidence of all the transactions that you will make.

So dont wait anymore. Get your personal banking account today.

Contractors Beware of The Personal Service Company

Being a contractor in the UK requires taking care of your own personal expenses and earnings. With this brings paperwork and the responsibility of managing taxes. Permanent workers don’t have this worry because most companies will have a dedicated finance department.

Before choosing to contract in the UK, the decision of either setting up a limited company, also known as a personal service company, or to simply use an umbrella company. Who will take care of all the tax issues, whilst providing additional benefits.

Both options are chosen on an individual basis, where normally umbrella companies are used for those choosing to contract short term. And limited companies being used for long term contracting. This is because tax savings can be much greater, but will require additional work.

So, What Are Personal Service Companies?

As previously mentioned, when choosing to set up a limited company is usually the result of a contractor seeking to benefit from tax savings and therefore increasing their take home pay. This is possible because limited companies enable contractors to be outside of the IR35 legislation. It is under this company that contractors will be working under, during any client work.

The tax efficiency of limited companies works by splitting a contractors income between their salary and dividends. This results in the contractor not having to pay national insurance contribution in their income. It s also essential for any freelance contractor to use a limited company or umbrella, otherwise no client would employ the contractor.

Here is a quick highlight of the benefits gained when working through a personal service company:

– Can be the most tax efficient way of earning,
– You become your own boss,
– In control of when and where you work,
– Ability to claim expenses,

In 1999 the term ‘personal service company’ was created, by HMRC, shortly after the introduction of IR35. But unfortunately the classification of what can identify limited companies as being a personal service companies is limited. This allows HMRC to be flexible during tax investigations.

The Problems That Exist

Unfortunately for those using this form of managing their payroll, they can often be viewed as attempting to dodge tax. Amongst negative press regarding this issue, the HMRC may be set to introducing new legislation on their use. The new legislation would treat contractors as though they were an employee, therefore requiring to pay national insurance and tax at the source, by their new ’employee’.

This could be a major problem for a large majority of those contracting long-term in the UK. For those currently with an umbrella company need not worry. Although this is an issue that every contractor should be aware of for future reference.

Types Of Vehicle Insurance In India

Today, anybody and everybody, has insurance of some sort. Either they believe in insuring themselves and their loved ones, or in insuring their vehicles! In India and in most other places, vehicle insurance is mandatory. The amount your vehicle can be insured for varies depending on the insurance companies and the insurance brokers.
In India, there are several types of vehicle insurances. Companies in India offer insurance at four levels.

1.Fully comprehensive vehicle insurance- This is by far the most expensive insurance, yet the most common type, as it covers all the possible damages and costs that your vehicle may incur. This type of vehicle insurance proves to be advantageous as there is no need to produce proof of the damage to claim the insurance amount. Thus, if your vehicle is damaged or stolen in your absence, then you can still approach the insurance company.

2.Third Party insurance- This type of insurance carries a comparatively cheaper premium and insures against damages and legal claims when you are at fault and have hit a third party. The insurance company is not responsible for any other scratches or occurring that takes place with your car.

3.Specialized car insurance- This type of insurance refers to any car that is over 25 years old, as vintage cars have different needs and requirements. Similar to a comprehensive auto insurance policy, the only difference between the two is that you are limited to an x amount of miles in a given year.

4.Third Party Fire and Theft insurance- Befitting to its name, this insurance covers the costs of your vehicle in case of fire, theft, accident, etc. However, in case of an accident, the insurance company will only pay up if you are at fault and have hit another car and not vice-versa.

In order to go forward with insuring your car, you need to carefully go through the various schemes offered by different insurance brokers. Each insurance broker has a scheme that offers one policy better than the other. A way of going about the entire process would be to patiently go through all the possible offers, look out for the best premium offered and then insure your vehicle. Today, online access to insurance schemes makes the process a whole lot easier.