Jumpstarting a Business After Bankruptcy

Bankruptcy filings increased by three percent in 2018, as per the latest statistics from the United States Bankruptcy Courts. However, this predicament does not prevent individuals from wanting to retrace their steps and make things right by venturing into business. Starting a new company after bankruptcy presents its own set of unique challenges. Therefore, the owner must set clear goals for their business while addressing the complexities that come with being bankrupt. Goal setting involves analyzing the situation one is in and working towards a set target and also asking for guidance from important avenues to avoid being financially distressed again. 

Seek Legal Advice

Entrepreneurs who have previously filed for bankruptcy need to understand the connection between bankruptcy and their startup. Therefore, seeking legal advice enables them to navigate the complexities of business and bankruptcy law. Legal advisors also assist entrepreneurs to best prepare for future conflicts that may arise post-bankruptcy. Matters of taxes, legal requirements and how to separate the business from the individual should be clarified at this stage. It is essential in situations where individuals filed for insolvency as sole proprietors. Therefore, the legal team could advise that the business be registered as a limited liability company to protect the owner’s assets in case of financial distress. 

Finance the Startup Without Credit

Every business requires a substantial amount of cash injection before it commences operation. Business loans come in handy for entrepreneurs to successfully operate. However, obtaining bank loans may deem futile post-bankruptcy. Besides, getting credit after bankruptcy may be expensive as financiers may charge higher interests rates on loans. Entrepreneurs should, therefore, strive to finance their venture without obtaining loans from financial institutions. Considering businesses that require little capital to start is a good option. Also, seeking financial assistance from family and friends may guarantee you an interest-free debt. Consequently, once the business is up and running, proprietors should ensure all obligations are met on the dates they are due and not on accrual basis.

Market your business

The success of any business is dependent on its customers and the effort put in place by the owner to reach them. Business owners must strive to ensure they bring on board as many clients as they can. While huge marketing techniques may be expensive for the startup at first, using friends, referrals and social media platforms are inexpensive but forthcoming forms of marketing. Consequently, the use of fliers, free samples and promotions can grow the customer base of a business. Also, having a motivated team who work in line with the business objectives will ensure quality service to clients. This, in turn, guarantees return and new customers for the business. 

Although being declared bankrupt may seem like the end of the world at first, it is not. With informed assistance, a person can go back to normalcy. Learning from previous mistakes by taking advantage of credit counseling you must attend to receive your discharge can help you prevent future financial issues. Knowing that building your credit score requires the use of any credit, acquired judiciously is a good start towards being smart when it comes to money matters.

Guest Author, Jenny Holt, is a former HR executive turned freelance writer, who now spends more time with her young family and ageing, but ever eager Labrador, Rover.

Protect Your Business: 4 Strategies for Preventing Money Laundering

You’ve put in a lot of hard effort to make your business the successful profit-churning powerhouse that it is. The idea that someone could be ripping you off and laundering money from your hard work should be disgusting to you. However, it might even be happening right now with you completely unaware. To ensure that your business is protected from criminals looking to siphon off of your hard work, utilize these four strategies to help prevent money laundering. 

Appoint an Anti-Money Laundering Compliance Officer

Initially, you should create an anti-money laundering policy that is clear in its dictation and punishments. As a further safeguard, it’s also prudent to hire an Anti-Money Laundering (AML) Compliance Officer who will routinely check the accounts and ensure there’s no fraud taking place. If they notice anything odd, they can report it to you. Keep in mind that the AML Compliance Officer should have extensive experience and knowledge in terms of financial policy, procedure, and crime.

Utilize Software 

Besides just an employee looking over the books, it’s also a wise idea to have an impartial bit of software looking over your shoulder for you, too. One piece of software you might want to consider is one that provides name matching services. This can be used as an anti-money laundering process that ensures those you bring into the business and those you do business with are legitimate people without fraudulent claims attached to their names. 

Bolster Accounting And Cash Handling Processes 

Another strategy to prevent money laundering is to bolster the accounting and cash-handling processes so that it makes laundering a lot more difficult. Additional watchdogs can be set to overlook these processes. However, you should keep the number of people who handle the accounts and cash handling as minimal as possible. Not only does this decrease the chances of someone with questionable morals from accessing your accounts, but it also helps narrow down the suspects when laundering is suspected. 

Knowing The Deal 

It’s also a good strategy to be a part of all of the deals that are made in your business. Or, at least, to be able to observe them, so you can ensure you understand the exact terms and benefits of the deal. Most importantly, you should know who is benefiting from the deal, how, and why. You may be able to sniff out questionable parties and report them. 

Money laundering is a terrible way to lose hard-earned profits in your business. By following these four strategies, you can bolster the security of your business and prevent laundering from occurring.

Guest author, Lizzie Weakley is a freelance writer from Columbus, Ohio. She went to college at The Ohio State University where she studied communications. In her free time, she enjoys the outdoors and long walks in the park with her 3-year-old husky Snowball.  @LizzieWeakley

4 Ways to Put an End to Your Debt

We have strong impulses that can quickly get us in trouble, and that’s a fact. Probably the strongest is the impulse to spend money – too much money. Sometimes it’s just a stupid thing, like relying too much on the power of our credit cards, but you don’t have to be reckless to end up in large debt.  Borrowing money has become a pretty normal thing in every grownup’s life – in this capitalistic society it may be the only way to get things we want or even really need. You’d say that there’d be a great debt awareness by now, but that’s not always the case. Even when it is, not many people are prepared for the unexpected that can take many forms – childbirth, lost job, an accident, etc. All these life-altering experiences will also quickly alter your finances and prevent you from paying back your loans on time.

Even if you lead a pretty steady life and are punctual with your repayments, their end may seem far out of reach. You’d want to pay off your loans faster and be done with it, but coming up with enough money seems impossible. That’s how you get accustomed to your debt. If you’ve signed a loan to finance your business you might expect that the growth of that business will take care of the repayments. But nothing can grow in financial shackles – not your business, not your life. And you’re the only one who can break from them. Poor financial decisions can be overcome with the right ones, and debt can become a thing of the past.

1. Make it a Priority

This is the worst thing about debts – the bigger they get, the less we want to look at them. You might say that you’d rather live your life than deal with numbers all the time, but there’s not much life in the situation where you’re running in circles. If you want to find the way out you need to look the numbers straight in the eye. It is actually a pretty obvious move and a really simple one. All you need is a Google Spreadsheet or a piece of paper if you’re a pen person. First, you need to visit the websites of each financial institution you have a debt to. Then simply copy down all balances along with their respective APRs, exactly as they appear – and pay special attention to your minimum payments for every account. Only after you track down all your debts this way you’ll know how much exactly do you owe and that is the road to getting rid of it.

2. Set Goals Along The Way

Knowing the exact amount you need to pay back can be overwhelming even for the most goal-oriented person, so the best way to go is to break it. Once your debt is in the form of manageable parts it won’t be scary anymore, and every small victory will provide you with more determination. The first thing you need to do is to assess how much money can you set aside for monthly repayments since that will shape your periodic goals. It will also provide you with a rough estimate of how long it will take you to get out, eliminating the factor of a neverending financial nightmare. To make these goals even stronger and boost your motivation, try to negotiate a lower interest rate with your creditors. Most people think that this possibility of interest rate reduction is a fairytale, but if you’ve done your homework on comprehensive credit reporting you should know better.  And now you have a bigger monthly repayment budget.

3. Catch The Big Fish First

When you have a clear list of debts in front of you it might be difficult to figure out where to start and decide on debt payment portion. Most people decide to pay balances low to high, not thinking about interest rates. It is understandable to try to keep your money, but that way you’ll do quite the opposite. If you’ve succeeded in reducing your interest rates you might be encouraged to take this road, but this should actually serve as a motivation to attack the debt with the highest interest rate and continue with the buildup of your budget. Debt is probably the only area in life where working your way down will get you much quicker above the surface. So you need to focus on the big fish you wish to eliminate first, making the minimum payment on other accounts. Then simply pass onto the next debt on the list, adding the money you’ve freed up to the minimum payment. People call this the snowball method, but once you try it it will seem more like a cleansing avalanche.

4. Balance Your Work And Savings

It is obvious that you’re gonna need to work more to pay off your debt faster. People go at great lengths, working overtime, taking second jobs, babysitting in their free time, etc. Although this is a very responsible thing to do, it could take you to the extreme where you’ll make your final payment in the nuthouse. That’s why it’s important to find the perfect balance between your work and savings. Yes, but you’ve thrown your complete savings on that big fish we’ve talked about above. Well, there are other ways to save up without working your ass off. It is just the question of how you look at the money. You have your bonuses, tax returns, birthday and wedding gifts, don’t you? Instead of treating that indirect income as a reward which you’ll use to buy you something nice, apply it directly at your debt.

But this windfall money is still not the only way to save up. You can downsize, for start. You have a shiny new car in your driveway, but you also have debt. So trade it for something cheap and you’ve saved up. Do the same with all your ʽtoysʼ – there’ll be plenty of time to play once you’re out of your debt. Once you’re out of big-ticket items that don’t mean your race is run. Every house or apartment is full of things we’re never gonna need, and yours is not an exception. And there are many people who do need (or think they need) that stuff, so it’s time for a garage sale.

In the end, you’ll save up by careful spending. Start with your utility bills. It’s pointless to pay for cable if you only watch Netflix, right? Then take a look at your fridge. Do you really eat all that? How about planning your meals? Maybe you can walk to the store instead of calling delivery every time? When you go shopping, leave your credit cards at home – handing cash will always remind you that you have to save up.

There you have it – looking your debt straight in the eye and breaking it down into manageable pieces it’s already half of the work done. It will boost your motivation to work harder and determination to keep the cash flow in the right direction.

Guest author Lucas is a business consultant with a passion for writing. Doing his research, exploring and writing are his favorite things to do. Besides that, he loves playing his guitar, hiking and traveling.

What Are You Doing to Improve Your Business?

Being a business owner can wear on some individuals over time. Given all the responsibilities in running a company, it can seem overwhelming. That said you want to do all you can to improve things before it becomes too late to act.

So, what are you doing to improve your business?

Finances Are Something to Focus in on

If you need to take steps to improve your footing, start by looking at how you are doing with finances. With that in mind, you might want to go online and apply here for a business line of credit.

In taking this action, you can move closer to receiving the help you need to straighten things out. Yes, some owners run into financial difficulties over time for one reason or another. That said you can’t afford to get into a funk where there is no end in sight to your financial challenges.

Even when you gain approval for a line of credit, the work does not end there.

With this being the case, also look at how you are doing when it comes to buying goods and services for your business.

Do you get the best deals possible when working with your vendors? If you rent office space, are you paying too much each month? Could you be using a better credit card to make purchases for your business? Remember, the interest fees with some cards can be quite hefty.

No matter what you do to improve your company’s financial outlook, do not wait until it is too late to take action.

Improving Your Brand’s Reach

As important as your company finances are, do not go to sleep on the importance of brand promotions.

As an example, do you promote your brand on social networking sites?

It is important to remember that social media is essentially free. As such, you do not have to spend tons of money to be relevant on social media. With some time and effort on your part, you can have an impact on social networking sites and not break the bank.

You also want to look at how your customer service efforts are being received by the public.

If your customer service is lacking, it can come back to haunt you. Remember, most of your customers have other options besides doing business with you. As a result, you could end up losing out on future business if some customers deem you did not go the extra mile for them.

Finally, you want to make sure you have productive and happy workers on your team.

Unless you have a one-person show running things, you will need the help of others. Given this fact, you want the best employees possible by your side. When you have them, you can improve your business approach.

Be sure to engage your employees and get their two cents on how you might improve your business.

Having meetings with your staff to discuss your company and how to make it even better are a good idea. You never know what someone might suggest for improvement that you did not think about.

In looking at where your small business will be soon, will you like what you see?

About the Author: Dave Thomas covers business topics on the web.

Celebrate Success! How to Throw the Business Party of the Year

A good party can bring everyone in your workplace together.If you’ve never organized one, however, you might be at a loss for how to get started. Here are just five suggestions for throwing an unforgettable company bash. 

Upgrade Your Internet 

If you’ll be teleconferencing with other offices or branches in a company-wide celebration, make sure that your Internet is strong enough for the task. Speed is probably the most important thing to keep your playback from lagging, but you’ll also need robust, reliable servers to prevent downtime. When everyone is toasting to the success of the company, you’ll want your sound and video quality to be crystal clear. 

Create a Flexible Schedule 

Since it’s a business party, you’ll probably need some kind of schedule for things like speeches and end-of-the-year acknowledgements.However, it’s important to have a little wiggle room with times. You don’t want to cut off a happy conga line so that the department manager can talk about stock trends. Mind the atmosphere of the party, and wave in your speakers when your audience is ready to hear them. 

Center Everything Around a Theme

Themes aren’t just fun for your guests. They’re also valuable tools for your party planners. When your drinks, games, activities and decorations all revolve around a specific idea like “casino night” or”winter wonderland,” it’s much easier to make decisions about what to buy. You might not be uncertain about your menu and music selection. However,if there’s a theme, it will all come together. For example, if you decide on a family-friendly theme, it’s only a short jump to buying Kaiser buns for burgers and fun pop songs to set the up-beat mood.

Mind Your Finances 

You don’t have to break the bank to host a great company party. You just need to be thoughtful and deliberate with your budget.One option is to break everything down by dollar amounts, and another possibility is allocating specific percentages of your budget to things like food, entertainment and venue. As long as you’re careful with your checkbook, you should be able to throw a wonderful party with cash to spare. 

Offer Freebies 

Everyone loves a freebie. You can generate a lot of goodwill towards both the company and the company party when you hand out goodie bags.You might also want to host raffles, giveaways or gift exchanges for the holidays. They can be a nice way to bond with your co-workers or raise money for a good cause. 

These are just a few tips for throwing a great business party. Whether you’re launching a new start-up or celebrating the expansion of your Fortune 500 brand, it’s always fun to let your hair down with the rest of your colleagues.

Dixie Somers is a freelance writer and blogger for business, home, and family niches. Dixie lives in Phoenix, Arizona, and is the proud mother of three beautiful girls and wife to a wonderful husband.

A Question Of Trust: Putting Our Faith In Remote Workers

When we’re trying to conserve our business’ productivity, its integrity, not to mention its finances, the modern approach that so many companies look to is the remote working setup. Naturally, it’s a big draw, not just because it’s a way to cut those financial corners, but it’s a way we can hire so many people, and actually, make the most of the limited finances we have. But, with remote working comes a lot of questions, not just in terms of the technicalities, but also, when you’re hiring remote workers or freelancers, this question of trust can arise. Are remote workers to be trusted? And how can we get around this issue?

The Handling Of Sensitive Data

The one basic way we can get around this is to have contracts. Even a freelancer contract carries a legal cache, and it’s the best way for us to cover our bases. Unfortunately, the difficulty of ensuring remote workers and freelancers handle data effectively is all about consistent communication. While there are some technological ways for you to keep on top of this, hiring a virtual server hosting company to do the monitoring, or hiring a dedicated team to monitor the computer components will ensure that you are keeping some sort of watchful eye on your remote employees.

Improving Your Communication With Them

As we can struggle with the idea of control when we have remote workers or freelancers, it’s important to differentiate between the two terms. Remote workers can be hired on a permanent contract, but freelancers are not. So, if you are concerned that the two aren’t mutually exclusive, you have to think about what you want from your employees. In addition to this, if you want freelancers to feel part of the team, you have to make them feel just that. The big anxiety that we can have when it comes to trusting remote workers is that they can leave us in the lurch when there is a deadline looming, and while we don’t want to be let down, if we don’t give them any sort of incentive to keep working for us, such as by minimal communication, then part of us shouldn’t be surprised when they do inevitably jump ship. Improving your communication isn’t about messaging them every 20 minutes or so, it’s giving them that room to breathe but showing them that you have faith in their abilities to complete the task. This is a hard thing for us to come to terms with, especially when we’re trying to keep numerous plates spinning, as well as get to know the new members of the team.

Don’t forget, it’s important that remote workers feel part of the team, even though they are working from home. Remote workers, from a stereotypical perspective, can take liberties, and not do what is asked of them, but if we are to trust remote workers, then we have to have some semblance of honesty in how we communicate. We can trust remote workers, and we should, but maybe it’s more about the fact that we have to come to terms with changing our own managerial styles.

6 Catastrophic Mistakes An Entrepreneur Can Make In Their Business’ First Year

What makes a great entrepreneur? There are numerous theories on the subject. Is it their hard work, dedication and commitment? Is it their invention, imagination and ability to think outside the box? Is it their ability to parse metric data and use it to keep their finger on the pulse of what their customers want and need? Or could it be their ability to motivate and rally their employees; helping them to work with gusto towards a shared goal. Ultimately, these are all extremely important but it’s arguable that the most important quality of entrepreneurship is…

dream

Image by Pixabay

Just start.

There are lots of people out there, right now, slaving away in jobs they despise who have a great idea for a business. They have spotted a gap in the market, devised a concept for a product for a product or service that neatly fills that gap and they have a clear vision in their heads of how that can be extrapolated into a living, breathing, working SME. They may have cobbled together something resembling a business plan in their free time. They’ve had some preliminary thoughts about what their business’ mission statement might be and how it would be reflected in their branding. They might even have crunched some numbers to create a reasonably accurate cash flow forecast. But they never reached the point where they reached out to sources of funding or even registered their business’ name. Why? Because they were paralyzed by their fear of the unknown. This perfectly natural and perfectly human impulse may be understandable but it can keep potentially successful entrepreneurs stuck on the path of wage slavery; languishing away in jobs where they’re underpaid, underappreciated and undervalued when they could be at the head of a thriving enterprise.

By far the most crippling of fears when it comes to starting a business is the fear of failure. After all, the numbers are not on the side of nascent entrepreneurs. We’ve all heard that 50% of SMEs fail within their first four years and we’re paralyzed by the fear of what will happen if we fall within this damning statistic. But here’s the thing…

There’s nothing to fear but fear itself

If you have a fantastic idea for a business that would benefit your local high street, create jobs, fill a gap on the market, benefit the local economy and liberate you from a job you despise, it behooves you to overcome your fear of failure and at least attempt to make your business a reality. Very often, failure in small business is not the end but simply a blip on a long learning curve. At worst, you will be made bankrupt (although this is certainly not an inevitable consequence of failure in small business). But in most cases bankruptcy is not the end of an entrepreneurial career. Some of the most successful people on the planet have been made bankrupt at least once.

That said, failure is never an appealing prospect. If we can forego the expense and emotional turmoil that come with failure in small business, so much the better, right?

Learning from the mistakes of others

The beauty of living in the digital age is that we have unparalleled access to a wealth of information which can give you and your business the inside track. As well as learning from our own mistakes (an inevitable and necessary part of small business) we can benefit from the mistakes of other nascent businesses. While there may be no surefire way of avoiding failure in the world of small business (if there were, everyone would be running their own SME), there are certainly commonly made mistakes that you can sidestep when you plan your operations and strategy around avoiding them. Here we’ll look at some of the commonly made mistakes made by businesses in their first year and how you can prevent your business from replicating them…

Under investing to insulate profit margins

When many entrepreneurs start out, they do so with one goal in mind… turning a profit. So long as the numbers are in the black month or month that means the business is going well, right? Well, not necessarily. As important as it is for small businesses to guard against irresponsible, reckless or vanity spending, it’s also vital that they avoid under investing in their enterprises. Under investment in personnel, capital investments like software or equipment, or maintaining / renovating your premises can impede your business’ growth. Unless you’re prepared to invest in better infrastructure for your small business it will only ever stay small and its scope will be limited. While you should certainly learn to walk before you can run and it can be counterproductive to set out with growth in mind before you know how to facilitate that growth sustainably, you should avoid the temptation to under invest in your business for the sake of insulating your profit margins.

Small businesses need to be agile and adaptable and if you fail to invest adequately, you may fail to capitalize on opportunities that come your way and your competitors will leave you in the dust.

piggybank

Image Credit

Dipping into personal funds to finance aspects of the business

Separating personal and business finances can be a real learning curve for nascent entrepreneurs. When you have a lot of passion and personal / emotional investment in your business it only makes sense to put your money where your mouth is… but this can be a serious mistake. Not only should you have separate accounts for your personal and business finances, you should take pains to ensure that one doesn’t bleed into the other. Otherwise you could find yourself on a slippery slope.

Trying to do a grade A job with grade B materials

In your first year of business, the name of the game is reputation. With such a plethora of competition out there, prospective customers need a reason to choose your business and not the legions of others who do exactly the same thing. This means that your reputation must be beyond reproach. While a big part of this is in how your employees deal with customers and the experience that your customers can expect, let’s not forget that you can’t do a grade A job with grade B materials. If you work in the construction industry, for example you know that you wouldn’t compromise on materials or make rush decisions when building the foundations of your project. You’d go to HelitechCCD.com and invest what you had to in materials that are right for the job. Otherwise, the whole thing could come tumbling down and take your reputation with it. Whether you’re in construction, catering or content the principal remains the same.

Spending too much time “at the coalface” and too little time on strategy

Entrepreneurs tend to have a proactive and hard working nature and when they see their employees struggling, their first instinct is to roll up your sleeves and join them at the coalface. But while noble in its intentions, this approach can be counterproductive in a number of ways. It can make your employees dependant on you at best or at worst turn you into the kind of relentless micromanager that employees hate to work for. Moreover, this is rarely the best place for you to invest your time and efforts. As the CEO of your business, your time is better spend in your office, concentrating on the strategic running of your business rather than day to day operations. It’s your responsibility to analyze your performance metrics and use them to influence your operational strategy month by month.

Having a resistant approach to new technology

Technology these days moves at a blistering pace. Investing in your technological infrastructure is rarely cheap and often requires an investment not only of capital but of time and effort as you and your employees get to grips with the software and hardware that your business needs to succeed. Thus, when equilibrium is achieved between a business and its tech, it can be extremely tempting to resist technological change. But technological change is an inevitable part of doing business in the 21st century. You need to maintain an agile approach to tech and be prepared to throw out the rulebook when a technological advancement necessitates an overhaul of your operations. If you resist technological change you could end up a dinosaur in your industry, like Blockbuster video in the age of Netflix. If this involves a prohibitively expensive overhaul of your IT or tech infrastructure, you may wish to consider outsourcing your IT operations. Not only will it insulate you from a lot of the cost of staying current, but your tech solutions can be scaled up as your business grows.

copetition

Image by Flickr

Failing to keep an eye on the competition

As important as it is to stay ahead of the curve, keeping your eyes too closely on your own work can be counterproductive. Your business does not operate in a vacuum and competitor analysis is an essential component of any sound business strategy. If your competitors offer something you don’t, run a promotion that you don’t or offer the same services at a price you can’t match you can’t assume that your customers will remain loyal to you.

Steer clear of these common pitfalls of first year businesses, however, and you stand every chance of laying a firm foundation for success.