Property management is an aspect of real estate that deals with maintenance and other needs for property with the purpose of maximizing and preserving the value of the property.  The property may be managed by the property owner, tenant, or contracted property management company.

Real estate companies have the initial responsibility of property management with their interest in the property management is to maximize the value of the property to potential buyers.  After the duty of property management has passed to the buyer, the property owner and the tenant must agree to a level of property management duties.  This may range from full responsibility on the tenant or landlord or a hybridized agreement that has the landlord responsible for major repairs and other aspects of property management.

Property management companies act on behalf of a landlord and interact with the tenants of a property.  The property management company may collect rent, find tenants and contract for repairs.  In many situations, the property management company fulfills the role of the property owner in all cases, including disputes stemming from non-payment of rent, eviction and neighbor complaints.  Requirements for property management companies vary by state with some states requiring real estate licensing for property management companies.  This is to ensure that the property management companies are abreast of real estate law in the state and will abide by those laws when dealing with tenants.

There are a number of property management software available that can help property owners manage the expenses and rental income from properties.  Additional features in property management software include the ability to general rental documents, such as lease agreements and generate tax forms in compliance with state and local tax laws.  Popular developers of property management software include Quicken, MDansby and Advanced Management Systems.  Property management software can be online subscription based or Graphical User Interface based for use on personal computers for a flat fee.  Some programs have bulk pricing for use on multiple computers.  This will be useful for property management companies that wish to automate some of their systems.

Unlike property management, which is the management of a tangible investment, assets management is primarily the management of investment funds such as stocks, commodities and equity funds.  Asset management is broken up into fixed income, equity and alternative investments, which include hedge funds, and real estate investment.  Individuals that work within assets management may specialize in any of the previously mentioned categories, helping individuals invest and manage their assets wisely.  Assets management is measured against a benchmark, which denotes how well it is “performing” which is a measure of how well the investment returns are comparable to other similar assets under management.  The performance of assets is the best way to determine if the asset manager is investing your assets safely.

 

CLAYTON ANTI-TRUST ACT TEXT

 

 

What is the Clayton Anti-Trust Act?

 

 

The Clayton Anti-Trust Act of 1914 was an addition to the Sherman Antitrust Act of 1890 that protected consumers against harmful, anti-competitive business arrangements such as monopolies and cartels by defining prohibitions and an enforcement scheme.

 

 

Discussion of Price Discrimination

 

 

The Clayton Anti-Trust Act discusses the effects of price discrimination, which is the sale of goods of services by an entity at different prices to different groups of consumers.  This is considered an anti-competitive practice as it indicates the power of the entity to fix and dictate prices for goods and services in order to hamper or eradicate competition.  In this pricing scheme, the commercial entity will charge every consumer individually according to his or her willing to pay for the good or service.  This can be harmful the consumer as it eliminates the consumer surplus, which would have saved the consumer money.  Instead, paying exactly what the consumer is willing to pay, the consumer is likely to pay far beyond the manufacturing costs of the item.

 

 

Price discrimination may hurt suppliers as well buy making it difficult to compete with artificially low prices.  If a large company seeking to increase its market share decides to price goods in a market far below what any other supplier can afford to charge, then the supplier will collapse under this predatory pricing scheme.  Once the larger commercial interest achieves dominance over a good or service market, they may dictate pricing as they please, which is an anti-competitive measure that the Clayton Anti-trust Act attempts to blunt.  The bill’s text specifically states that price discrimination tends to “create monopolies in any line of commerce.”

 

 

In terms of this act, while it cannot outlaw price discrimination, it can control agreements and dealings that would constitute price discrimination and take rectification measures.

 

 

Mergers and Acquisitions

 

 

This is one of the more important features of the Clayton Anti-Trust Act and remains in effect today.  This requires commercial entities that intend to form larger enterprises through mergers and acquisitions notify the Federal Trade Commission and the Department of Justice Antitrust Division if they exceed certain thresholds that are dependent on GDP and adjusted on a yearly basis.  The controls on mergers and acquisitions prevent one entity from gaining an unfair advantage and dominating a market, which would allow it to engage in anti-competitive pricing and other abuses of their controlling interest.  It is the responsibility of government authorities to ensure that mergers will not substantially lessen competition.

 

 

The Clayton Anti-Trust Act specifically mentions holding companies as another means to achieve a monopoly through holding the stocks of other companies in the same manner as the trusts that the Sherman Act attempted to eradicate.

 

 

Exclusive sales contracts

 

 

Also known as exclusive dealing, this is mostly illegal in the US unless registered and approved by the federal government.  It prevents the entry of new firms into the market by preventing potential suppliers or outlets from dealing with these new firms.  This presents a type of non-competitive market condition called vertical integration that can be potentially harmful to the consumer if the supplier has control over all phases of the manufacturer of the product, from the raw material extraction to final resale, effectively allowing them to set an unfair price due to lowered input costs.  If this advantage affects the competitiveness of the markets, then enforcement may be necessary.  

 

 

The Clayton Anti-Trust Act restricts the use of exclusive sales contracts “tying” a supplier to another commercial interest to allow for a competitive marketplace with pricing determined by the market and not through exclusive dealings.  Third line forcing, which is a supplier compelling the consumer to purchase goods from a third party and refusing to supply the product if that condition is not agreed to, is also prohibited.  It is anti-competitive to tie the goods of one supplier to another and compel the consumer to abide by that agreement.  An example would be a computer manufacturer refusing to let a consumer buy the product without also purchasing a third party desk to place the computer on.  This arrangement can also be used to fix the price of products by exploiting an advantage that one product has on the market.

 

 

Corporate structure

 

 

Section 8 of the Clayton Anti-Trust Act prohibits an individual from serving as the director of more than one corporation, also a key indicator of an unfair market advantage or corporate loophole.

 

 

In regards to unions

 

 

The Clayton Anti-Trust Act does not cover unions as these organizations represent the labor of workers, which is neither a “commodity nor article of commerce.”  Actions by the union are not considered anti-competitive and they may engage in activities against the employer, such as striking.  This contrasts to the preceding Sherman Anti-trust Act that was sometimes used as part of “union busting” due to the dubious classification of unions as “cartels of human labor.” Therefore, injunctions could no longer be used to end most labor actions.

 

 

Enforcement of the Clayton Anti-Trust Act

 

 

The Anti-Trust Division of the US Department of Justice works with the Federal Trade Commission to regulate and if necessary, file suit against violators of anti-trust laws.  For example, the Department of Justice may bring suit against several service providers that are colluding on prices offered to consumers.  This constitutes a cartel of sorts and is an anti-competitive environment that harms consumers.  Although collusion may resolve itself rise the rise of new firms or one commercial interest cheating the others, the government regulators can also get involved and break up the cartel.

 

 

Criticism

 

 

Some have criticized government regulations such as the Sherman Anti-trust Act and the Clayton Anti-Trust Act as stifling innovation and creating undue inefficiency in the free market.  These critics argue that larger commercial entities have the ability and incentive to continue innovation to maintain their market share and that supporting smaller, less capable enterprises in the name of competitiveness is inherently anti-competitive.  These proponents also strongly believe in the self-correcting nature of markets and the eventuality that inefficient collusive enterprises that work contrary to consumers will ultimately fail.

 

 

This legislation is also accused of destroying “economies of scale” by preventing business expansion that in turn prevents cost lowering mechanisms such as bulk buying, long term contracts and specialization.  Larger commercial enterprises also get better interest rates from banks for long term borrowing.  Increasing economies of scale create natural monopolies that usually benefit the consumer as the ever expanding commercial interest gets increasing capable of providing lower cost goods and widespread commercial success from expanding in new markets.

 

 

Full Text of the Clayton Anti-Trust Act

Sec. 13. Discrimination in price, services, or facilities (§ 2 of the Clayton Act)

(a) Price; selection of customers

It shall be unlawful for any person engaged in commerce, in the course of such commerce, either directly or indirectly, to discriminate in price between different purchasers of commodities of like grade and quality, where either or any of the purchases involved in such discrimination are in commerce, where such commodities are sold for use, consumption, or resale within the United States or any Territory thereof or the District of Columbia or any insular possession or other place under the jurisdiction of the United States, and where the effect of such discrimination may be substantially to lessen competition or tend to create a monopoly in any line of commerce, or to injure, destroy, or prevent competition with any person who either grants or knowingly receives the benefit of such discrimination, or with customers of either of them: Provided, That nothing herein contained shall prevent differentials which make only due allowance for differences in the cost of manufacture, sale, or delivery resulting from the differing methods or quantities in which such commodities are to such purchasers sold or delivered: Provided, however, That the Federal Trade Commission may, after due investigation and hearing to all interested parties, fix and establish quantity limits, and revise the same as it finds necessary, as to particular commodities or classes of commodities, where it finds that available purchasers in greater quantities are so few as to render differentials on account thereof unjustly discriminatory or promotive of monopoly in any line of commerce; and the foregoing shall then not be construed to permit differentials based on differences in quantities greater than those so fixed and established: And provided further, That nothing herein contained shall prevent persons engaged in selling goods, wares, or merchandise in commerce from selecting their own customers in bona fide transactions and not in restraint of trade: And provided further, That nothing herein contained shall prevent price changes from time to time where in response to changing conditions affecting the market for or the marketability of the goods concerned, such as but not limited to actual or imminent deterioration of perishable goods, obsolescence of seasonal goods, distress sales under court process, or sales in good faith in discontinuance of business in the goods concerned.

(b) Burden of rebutting prima-facie case of discrimination

Upon proof being made, at any hearing on a complaint under this section, that there has been discrimination in price or services or facilities furnished, the burden of rebutting the prima-facie case thus made by showing justification shall be upon the person charged with a violation of this section, and unless justification shall be affirmatively shown, the Commission is authorized to issue an order terminating the discrimination: Provided, however, That nothing herein contained shall prevent a seller rebutting the prima-facie case thus made by showing that his lower price or the furnishing of services or facilities to any purchaser or purchasers was made in good faith to meet an equally low price of a competitor, or the services or facilities furnished by a competitor.

(c) Payment or acceptance of commission, brokerage, or other compensation

It shall be unlawful for any person engaged in commerce, in the course of such commerce, to pay or grant, or to receive or accept, anything of value as a commission, brokerage, or other compensation, or any allowance or discount in lieu thereof, except for services rendered in connection with the sale or purchase of goods, wares, or merchandise, either to the other party to such transaction or to an agent, representative, or other intermediary therein where such intermediary is acting in fact for or in behalf, or is subject to the direct or indirect control, of any party to such transaction other than the person by whom such compensation is so granted or paid.

(d) Payment for services or facilities for processing or sale

It shall be unlawful for any person engaged in commerce to pay or contact for the payment of anything of value to or for the benefit of a customer of such person in the course of such commerce as compensation or in consideration for any services or facilities furnished by or through such customer in connection with the processing, handling, sale, or offering for sale of any products or commodities manufactured, sold, or offered for sale by such person, unless such payment or consideration is available on proportionally equal terms to all other customers competing in the distribution of such products or commodities.

(e) Furnishing services or facilities for processing, handling, etc.

It shall be unlawful for any person to discriminate in favor of one purchaser against another purchaser or purchasers of a commodity bought for resale, with or without processing, by contracting to furnish or furnishing, or by contributing to the furnishing of, any services or facilities connected with the processing, handling, sale, or offering for sale of such commodity so purchased upon terms not accorded to all purchasers on proportionally equal terms.

(f) Knowingly inducing or receiving discriminatory price

It shall be unlawful for any person engaged in commerce, in the course of such commerce, knowingly to induce or receive a discrimination in price which is prohibited by this section.

 Sec. 13a. Discrimination in rebates, discounts, or advertising service charges; underselling in particular localities; penalties

It shall be unlawful for any person engaged in commerce, in the course of such commerce, to be a party to, or assist in, any transaction of sale, or contract to sell, which discriminates to his knowledge against competitors of the purchaser, in that, any discount, rebate, allowance, or advertising service charge is granted to the purchaser over and above any discount, rebate, allowance, or advertising service charge available at the time of such transaction to said competitors in respect of a sale of goods of like grade, quality, and quantity; to sell, or contract to sell, goods in any part of the United States at prices lower than those exacted by said person elsewhere in the United States for the purpose of destroying competition, or eliminating a competitor in such part of the United States; or, to sell, or contract to sell, goods at unreasonably low prices for the purpose of destroying competition or eliminating a competitor.

Any person violating any of the provisions of this section shall, upon conviction thereof, be fined not more than $5,000 or imprisoned not more than one year, or both.

 Sec. 13b. Cooperative association; return of net earnings or surplus

Nothing in this Act shall prevent a cooperative association from returning to its members, producers, or consumers the whole, or any part of, the net earnings or surplus resulting from its trading operations, in proportion to their purchases or sales from, to, or through the association.

 Sec. 13c. Exemption of non-profit institutions from price discrimination provisions

Nothing in the Act approved June 19, 1936, known as the Robinson-Patman Antidiscrimination Act, shall apply to purchases of their supplies for their own use by schools, colleges, universities, public libraries, churches, hospitals, and charitable institutions not operated for profit.

 Sec. 14. Sale, etc., on agreement not to use goods of competitor (§ 3 of the Clayton Act)

It shall be unlawful for any person engaged in commerce, in the course of such commerce, to lease or make a sale or contract for sale of goods, wares, merchandise, machinery, supplies, or other commodities, whether patented or unpatented, for use, consumption, or resale within the United States or any Territory thereof or the District of Columbia or any insular possession or other place under the jurisdiction of the United States, or fix a price charged therefor, or discount from, or rebate upon, such price, on the condition, agreement, or understanding that the lessee or purchaser thereof shall not use or deal in the goods, wares, merchandise, machinery, supplies, or other commodities of a competitor or competitors of the lessor or seller, where the effect of such lease, sale, or contract for sale or such condition, agreement, or understanding may be to substantially lessen competition or tend to create a monopoly in any line of commerce.

 Sec. 15. Suits by persons injured (§ 4 of the Clayton Act)

(a) Amount of recovery; prejudgment interest

Except as provided in subsection (b) of this section, any person who shall be injured in his business or property by reason of anything forbidden in the antitrust laws may sue therefor in any district court of the United States in the district in which the defendant resides or is found or has an agent, without respect to the amount in controversy, and shall recover threefold the damages by him sustained, and the cost of suit, including a reasonable attorney’s fee. The court may award under this section, pursuant to a motion by such person promptly made, simple interest on actual damages for the period beginning on the date of service of such person’s pleading setting forth a claim under the antitrust laws and ending on the date of judgment, or for any shorter period therein, if the court finds that the award of such interest for such period is just in the circumstances. In determining whether an award of interest under this section for any period is just in the circumstances, the court shall consider only –

(1) whether such person or the opposing party, or either party’s representative, made motions or asserted claims or defenses so lacking in merit as to show that such party or representative acted intentionally for delay, or otherwise acted in bad faith;

(2) whether, in the course of the action involved, such person or the opposing party, or either party’s representative, violated any applicable rule, statute, or court order providing for sanctions for dilatory behavior or otherwise providing for expeditious proceedings; and

(3) whether such person or the opposing party, or either party’s representative, engaged in conduct primarily for the purpose of delaying the litigation or increasing the cost thereof.

(b) Amount of damages payable to foreign states and instrumentalities of foreign states

(1) Except as provided in paragraph (2), any person who is a foreign state may not recover under subsection (a) of this section an amount in excess of the actual damages sustained by it and the cost of suit, including a reasonable attorney’s fee.

(2) Paragraph (1) shall not apply to a foreign state if –

(A) such foreign state would be denied, under section 1605(a)(2) of title 28, immunity in a case in which the action is based upon a commercial activity, or an act, that is the subject matter of its claim under this section;

(B) such foreign state waives all defenses based upon or arising out of its status as a foreign state, to any claims brought against it in the same action;

(C) such foreign state engages primarily in commercial activities; and

(D) such foreign state does not function, with respect to the commercial activity, or the act, that is the subject matter of its claim under this section as a procurement entity for itself or for another foreign state.

 Sec. 15a. Suits by United States; amount of recovery; prejudgment interest (§ 4a of the Clayton Act)

Whenever the United States is hereafter injured in its business or property by reason of anything forbidden in the antitrust laws it may sue therefor in the United States district court for the district in which the defendant resides or is found or has an agent, without respect to the amount in controversy, and shall recover threefold the damages by it sustained and the cost of suit. The court may award under this section, pursuant to a motion by the United States promptly made, simple interest on actual damages for the period beginning on the date of service of the pleading of the United States setting forth a claim under the antitrust laws and ending on the date of judgment, or for any shorter period therein, if the court finds that the award of such interest for such period is just in the circumstances. In determining whether an award of interest under this section for any period is just in the circumstances, the court shall consider only –

(1) whether the United States or the opposing party, or either party’s representative, made motions or asserted claims or defenses so lacking in merit as to show that such party or representative acted intentionally for delay or otherwise acted in bad faith;

(2) whether, in the course of the action involved, the United States or the opposing party, or either party’s representative, violated any applicable rule, statute, or court order providing for sanctions for dilatory behavior or otherwise providing for expeditious proceedings;

(3) whether the United States or the opposing party, or either party’s representative, engaged in conduct primarily for the purpose of delaying the litigation or increasing the cost thereof; and

(4) whether the award of such interest is necessary to compensate the United States adequately for the injury sustained by the United States.

 Sec. 15b. Limitation of actions (§ 4b. of the Clayton Act)

Any action to enforce any cause of action under section 15, 15a, or 15c of this title shall be forever barred unless commenced within four years after the cause of action accrued. No cause of action barred under existing law on the effective date of this Act shall be revived by this Act.

 Sec. 15c. Actions by State attorneys general (§ 4c of the Clayton Act)

(a) Parens patriae; monetary relief; damages; prejudgment interest

(1) Any attorney general of a State may bring a civil action in the name of such State, as parens patriae on behalf of natural persons residing in such State, in any district court of the United States having jurisdiction of the defendant, to secure monetary relief as provided in this section for injury sustained by such natural persons to their property by reason of any violation of sections 1 to 7 of this title. …

(2) The court shall award the State as monetary relief threefold the total damage sustained as described in paragraph (1) of this subsection, and the cost of suit, including a reasonable attorney’s fee. The court may award under this paragraph, pursuant to a motion by such State promptly made, simple interest on the total damage for the period beginning on the date of service of such State’s pleading setting forth a claim under the antitrust laws and ending on the date of judgment, or for any shorter period therein, if the court finds that the award of such interest for such period is just in the circumstances. In determining whether an award of interest under this paragraph for any period is just in the circumstances, the court shall consider only –

(A) whether such State or the opposing party, or either party’s representative, made motions or asserted claims or defenses so lacking in merit as to show that such party or representative acted intentionally for delay or otherwise acted in bad faith;

(B) whether, in the course of the action involved, such State or the opposing party, or either party’s representative, violated any applicable rule, statute, or court order providing for sanctions for dilatory behavior or other wise providing for expeditious proceedings; and

(C) whether such State or the opposing party, or either party’s representative, engaged in conduct primarily for the purpose of delaying the litigation or increasing the cost thereof.

 Sec. 15d. Measurement of damages (§ 4d of the Clayton Act)

In any action under section 15c(a)(1) of this title, in which there has been a determination that a defendant agreed to fix prices in violation of sections 1 to 7 of this title, damages may be proved and assessed in the aggregate by statistical or sampling methods, by the computation of illegal overcharges, or by such other reasonable system of estimating aggregate damages as the court in its discretion may permit without the necessity of separately proving the individual claim of, or amount of damage to, persons on whose behalf the suit was brought.

 Sec. 17. Antitrust laws not applicable to labor organizations (§ 6 of the Clayton Act)

The labor of a human being is not a commodity or article of commerce. Nothing contained in the antitrust laws shall be construed to forbid the existence and operation of labor, agricultural, or horticultural organizations, instituted for the purposes of mutual help, and not having capital stock or conducted for profit, or to forbid or restrain individual members of such organizations from lawfully carrying out the legitimate objects thereof; nor shall such organizations, or the members thereof, be held or construed to be illegal combinations or conspiracies in restraint of trade, under the antitrust laws.

 Sec. 18. Acquisition by one corporation of stock of another (§ 7 of the Clayton Act)

No person engaged in commerce or in any activity affecting commerce shall acquire, directly or indirectly, the whole or any part of the stock or other share capital and no person subject to the jurisdiction of the Federal Trade Commission shall acquire the whole or any part of the assets of another person engaged also in commerce or in any activity affecting commerce, where in any line of commerce or in any activity affecting commerce in any section of the country, the effect of such acquisition may be substantially to lessen competition, or to tend to create a monopoly.

No person shall acquire, directly or indirectly, the whole or any part of the stock or other share capital and no person subject to the jurisdiction of the Federal Trade Commission shall acquire the whole or any part of the assets of one or more persons engaged in commerce or in any activity affecting commerce, where in any line of commerce or in any activity affecting commerce in any section of the country, the effect of such acquisition, of such stocks or assets, or of the use of such stock by the voting or granting of proxies or otherwise, may be substantially to lessen competition, or to tend to create a monopoly.

This section shall not apply to persons purchasing such stock solely for investment and not using the same by voting or otherwise to bring about, or in attempting to bring about, the substantial lessening of competition. Nor shall anything contained in this section prevent a corporation engaged in commerce or in any activity affecting commerce from causing the formation of subsidiary corporations for the actual carrying on of their immediate lawful business, or the natural and legitimate branches or extensions thereof, or from owning and holding all or a part of the stock of such subsidiary corporations, when the effect of such formation is not to substantially lessen competition.

Nor shall anything herein contained be construed to prohibit any common carrier subject to the laws to regulate commerce from aiding in the construction of branches or short lines so located as to become feeders to the main line of the company so aiding in such construction or from acquiring or owning all or any part of the stock of such branch lines, nor to prevent any such common carrier from acquiring and owning all or any part of the stock of a branch or short line constructed by an independent company where there is no substantial competition between the company owning the branch line so constructed and the company owning the main line acquiring the property or an interest therein, nor to prevent such common carrier from extending any of its lines through the medium of the acquisition of stock or otherwise of any other common carrier where there is no substantial competition between the company extending its lines and the company whose stock, property, or an interest therein is so acquired.

 Sec. 25. Restraining violations; procedure (§ 15 of the Clayton Act)

The several district courts of the United States are invested with jurisdiction to prevent and restrain violations of this Act, and it shall be the duty of the several United States attorneys, in their respective districts, under the direction of the Attorney General, to institute proceedings in equity to prevent and restrain such violations. Such proceedings may be by way of petition setting forth the case and praying that such violation shall be enjoined or otherwise prohibited. When the parties complained of shall have been duly notified of such petition, the court shall proceed, as soon as may be, to the hearing and determination of the case; and pending such petition, and before final decree, the court may at any time make such temporary restraining order or prohibition as shall be deemed just in the premises. Whenever it shall appear to the court before which any such proceeding may be pending that the ends of justice require that other parties should be brought before the court, the court may cause them to be summoned whether they reside in the district in which the court is held or not, and subpoenas to that end may be served in any district by the marshal thereof.

 Sec. 26. Injunctive relief for private parties; exception; costs (§ 16 of the Clayton Act)

Any person, firm, corporation, or association shall be entitled to sue for and have injunctive relief, in any court of the United States having jurisdiction over the parties, against threatened loss or damage by a violation of the antitrust laws, including sections 13, 14, 18, and 19 of this title, when and under the same conditions and principles as injunctive relief against threatened conduct that will cause loss or damage is granted by courts of equity, under the rules governing such proceedings, and upon the execution of proper bond against damages for an injunction improvidently granted and a showing that the danger of irreparable loss or damage is immediate, a preliminary injunction may issue: Provided, That nothing herein contained shall be construed to entitle any person, firm, corporation, or association, except the United States, to bring suit in equity for injunctive relief against any common carrier subject to the provisions of subtitle IV of title 49, in respect of any matter subject to the regulation, supervision, or other jurisdiction of the Interstate Commerce Commission. In any action under this section in which the plaintiff substantially prevails, the court shall award the cost of suit, including a reasonable attorney’s fee, to such plaintiff.

 

 

 

What is the CAN SPAM Act?

 

 

The CAN SPAM act is an acronym for Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 and is a measure to impose penalties and regulate “spam” email messages.  This Act defines federal authority over companies that “spam” and prevents states from forming additional laws and private citizens from seeking redress from spammers.  The intention of the law is to protect consumers and maintain the efficiency of email as a form of communication.

 

 

Why is there federal authority in the CAN-SPAM Act?

 

 

The CAN-SPAM Act is designed to help companies that do want to use commercial emailing service comply with only one set of regulations, rather than regulations that vary from state to state.  The Federal Trade Commission is required to ensure compliance with this act and report to Congress on its effectiveness while recommending changes.  Due to the interstate nature of spam and the occasional difficulty of tracking the locations of senders, enforcement can be difficult.  This is why there are added provisions that require commercial emails to provide verified addresses of the establishment sending the email.

 

 

What must businesses do to comply with CAN-SPAM?

 

 

The Federal Trade Commission offers simple guidelines for compliance for regulation.  

 

 

These include:

 

 

1. Accurate header information so as to identify the establishment that sent the message.

 

 

2. Non-deceptive and accurate subject lines

 

 

3. The email must in one way or another identify itself as an advertisement

 

 

4. Include an address, which can be a physical location or a post office box

 

 

5. Include opt-out information if consumers decide they no longer want to receive emails

 

 

6. Follow proper guidelines for opting out (see below)

 

 

7. Ensure that third parties advertising on your behalf comply with regulations as you can be held liable for their actions.

 

 

What is affirmative consent?

 

 

Affirmative consent, as defined by the law, describes a situation where the recipient has consented to receive the message or agreed with another enterprise to share his or her email address with the other party that has sent the email.  One that has an affirmative relationship with the sender but forwards or sends the email to another may be engaging in a violation if the forwarding party is paid or compensated by the original sender. 

 

 

What are the distinctions made in the CAN-SPAM Act?

 

 

This law, when forcing compliance on businesses, defines a “primary purpose” for the email.  If the email is commercial in nature, then it must comply with regulations.  If the email is transactional or relational in nature, then the business need not comply with set regulations.  If the email is mixed purpose, the transaction and relational content must be the focus of the email, otherwise it will be classified as commercial content.  Transactional emails include commercial transaction confirmation, warranty information, changes to the commercial relationship (such as membership or subscriptions) and good delivery.

 

 

How do consumers opt out of commercial emails?

 

 

Businesses that send commercial emails must have a clearly labeled and defined process for letting consumers opt out of future emails.  The process to opt out must either be instant or cause the consumer to visit only one webpage.  Opt out processes that are more complicated or require the consumer to provide more personal information are expressly forbidden.  This request must be honored within 10 days.  The consumer’s email address is placed on a “suppression list” which prevents emails from that business from being sent there again in the future, as per provisions of the CAN-SPAM Act.  This list may not be distributed or sold to third parties under penalty of law.

 

 

What are provisions to the CAN-SPAM Act that are helpful to spammers?

 

 

The CAN-SPAM Act does not require the e-mailer to obtain permission before sending commercial email.  States cannot set stricter laws on spam email and private citizens are not allowed to bring suit against spammers.

 

 

What are the penalties for violating this Act?

 

 

In addition to laws government deceptive advertising, there are penalties of up to $16,000 for non-compliance with the provisions of the CAN-SPAM Act.  Additionally, there are misdemeanor criminal penalties for using others’ computers to send spam via Trojan viruses and other means, falsifying information to obtain domain name, using open relays to mass email and engaging in dictionary attacks.  Dictionary attacks are the random generation of email addresses from random letters and numbers to reach a potentially valid email address.  Additionally, consumers can take violators to small claims court and collect $1 minimum for each spam message received.

 

 

What are rules governing mobile phone SMS spam?

 

 

A company can be in violation of CAM-SPAM if they send commercial text messages to consumers that do not opt into or affirm that they want the messages.  SMS spam is rare in the United States due to limitations on the number of messages that can be sent at a time and the fact that consumers are usually charged for receiving messages.  Businesses that do violate this rule however, can be subject to class-action litigation, initiated by the government.

 

 

What are rules governing explicit content?

 

 

For emails that contain sexual content, the nature of the content, with the words “SEXUALLY EXPLICIT” must appear in the subject line.  No graphic content must be visual when the email is open, only links to the content or content placed at the bottom of the email, requiring the recipient to scroll down.  This rule does not apply if the recipient has an affirmative relationship with the sender agreeing in advance to receive explicit emails from the sender.

 

 

Has the CAN-SPAM Act been effective?

 

 

This Act, due to a lack of enforcement and compliance is not responsible for the decrease in spam.  Rather, improved filtering technology in email clients prevents a significant amount of spam from reach consumer’s email inboxes.  Reports in PC World indicated that at most, 1% of spam emails complied with CAN-SPAM.  Meanwhile, almost 90% of emails are spam and there is no way to regulate “spam bots” or automatic email senders from outside the United States.

 

 

Several companies that do not comply with commercial email regulations have been taken to court, usually successfully and order to forfeit some or all of the earning from their crime in addition to charges of fraud and in some cases, conspiracy and money laundering.

 

 

Due to widespread non-compliance, creating a national registry of emails that cannot be spammed is unlikely as the addresses cannot be verified, there are millions of email addresses in the United States and there exists a large risk of leaked information aiding rather than hampering spam senders.

 

 

How does this law affect states?

 

 

These regulations prevent states from enforcing their own laws on spam to avoid redundancy and frivolous lawsuits.

 

 

“This chapter supersedes any statute, regulation, or rule of a State or political subdivision of a State that expressly regulates the use of electronic mail to send commercial messages, except to the extent that any such statute, regulation, or rule prohibits falsity or deception in any portion of a commercial electronic mail message or information attached thereto.“

 

 

Source: 

 

https://business.ftc.gov/documents/bus61-can-spam-act-compliance-guide-business

 

 

 

 

 

 

 

What is the Federal Arbitration Act?

 

 

The Federal Arbitration Act is a United States Federal Statute that provides for judicial facilitation for private dispute resolutions enacted through arbitration. The Federal Arbitration Act applies in both federal and state courts—it is a federal law that is upheld by all states. The statute is applied when a transaction is contemplated by both parties involved in interstate commerce and is predicated on the exercise of the United States Commerce Clause—a law granted to Congress in the United States Constitution.

 

 

Found at 9 U.S.C Section 1, the Federal Arbitration Act was formally enacted in 1925. The law provides for a contractually-based mandatory arbitration; the act results in the award of arbitration entered by a panel or arbitrator as opposed to judgments filed by courts of law.  

 

 

The Federal Arbitration Act requires that in instances where both parties agree to arbitration, they must do so in lieu of filing a court hearing. In an arbitration hearing, both parties formally give up the right to file appeals on substantive grounds in a court setting. Once an arbitration award is entered by a penal or arbitrator, the filing must be confirmed in a coordinating court setting. Once the award is confirmed, it is then reduced to an enforceable judgment, which will be enforced by the winning party, like any other legal judgment. 

 

 

According to the Federal Arbitration Act, awards must be confirmed within one year of the filing. Any objection to the award, in turn, must be challenged by the losing party within three months of the delivery of judgment. Arbitration agreements may be entered in a prospective manner, meaning the agreement is made in advance of any actual dispute. Furthermore, the agreement may be entered by either disputing party once a conflict arises. 

 

 

 

The Gramm–Leach–Bliley Act of 1999, sometimes referred to as the Financial Services Modernization Act, is an act created by the 106th U.S. Congress. The Gramm–Leach–Bliley Act was signed into law Bill Clinton, which repealed sections of the 1933 Glass–Steagall. This opened up the market among security companies, insurance companies, ad banking companies. The former Glass–Steagall Act did not allow any single institution from performing as any sort of combination of an insurance company, commercial bank, or an investment bank.

The Gramm Leach Bliley Act of 1999 allowed securities firms, insurance companies, commercial banks, and investment banks, to consolidate if desired. The Gramm Leach Bliley Act of 1999 was passed to legalize mergers between these organizations on a permanent basis. The Gramm Leach Bliley Act of 1999 also repealed the Glass–Steagall Act’s conflict regarding interest prohibitions against simultaneous service by an employee, director, or an  officer of a securities firm as an employee, director, or an officer of any member bank.

The banking industry had wanted to repeal the 1933 Glass–Steagall Act since around the 1980s. The Congressional Research Service created a report in 1987 that researched the cases for and against keeping the Glass–Steagall act.

Separate versions of the Gramm Leach Bliley Act of 1999 were introduced to the Senate by Phil Gramm, and by Jim Leach in the House. Representative Thomas J. Bliley, Jr., the House Commerce Committee’s Chairman, was the third legislator associated to the Act. The House approved its version of the Act on July 1, 1999 with a bipartisan vote of 343-86, two months after the Senate’s version of the bill had passed with a 54–44 vote which essentially followed party lines.

When both chambers could not decide on a joint version of the Gramm Leach Bliley Act of 1999, the House voted (241-132) on July 30 to tell the House’s negotiators to work to pass a law that ensured that consumers could enjoy financial and medical privacy along with strong competition and non-discriminatory and equal access to the economic opportunities and financial services in their communities.

The bill was then moved to a conference committee between the two chambers to figure out the differences between the House and Senate versions of the bill. Democrats agreed to support it once Republicans agreed to address certain concerns about privacy in the bill and also strengthen provisions regarding the anti-redlining Community Reinvestment Act. The conference committee worked to finish making changes to the bill and on November 4, the final bill, which resolved the differences between the two versions, was passed in the Senate with a 90-8 vote and in the House with a 362-57. The passed bill was then signed into law by President Bill Clinton on November 12, 1999 as the Gramm Leach Bliley Act of 1999.

Many of the largest brokerages, insurance companies, and banks wanted the Gramm–Leach–Bliley Act to pass at the time. The justification for this was that individuals will typically put more money into various investments when the economy is healthy and strong, but if the economy is poor and weak, these potential investors will place the majority of their money into savings accounts. With the Gramm–Leach–Bliley Act, these investors could be able both save and invest without using different financial institutions, allowing the institution to thrive in both bad and good economic times.

Before the Gramm–Leach–Bliley Act, the majority of financial services companies already offered both investment and saving opportunities to their clients. Furthermore, before the Gramm–Leach–Bliley Act passed, there were a variety of relaxations found in the Glass–Steagall Act. An example of this was a few years before, commercial Banks could pursue investment banking, and banks could begin insurance and stock brokerages. Insurance underwriting was the single operation that was not allowed, which was rarely done even after passing the Gramm Leach Bliley Act of 1999. 

A lot of consolidation and merging happened in the financial services industry subsequently, but not to the extent that some had expected. For example, retail banks typically do not buy insurance underwriters, since they look for more profitable businesses such as insurance brokerages where they sell products from other insurance companies. Retail banks did not quickly package insurance and investment products in a way that was convincing and appealing to consumers. 

Brokerage companies also had a hard time finding a way into banking, because these organizations are not known for having large branches and back shop footprints. More recently, banks have started a trend of buying other banks, but they still have less success integrating with other organizations such as insurance or investment companies. Many of these banks have gone beyond their normal scope and tried getting into investment banking, but many have found it difficult to easily package these products with their banking services, without having to resort to concerning tie-ins that can be the cause of scandals.

In order for the Gramm-Leach-Bliley Act to successfully pass, an amendment was made to the bill which stated that mergers could not be cleared to go ahead if any of the involved financial holding institutions, or any affiliates thereof, received a rating that was less than satisfactory at the most recent CRA exam. This mean that any merger could only go on ahead if it had received the strict approval of the necessary regulatory bodies that were in charge for the Community Reinvestment Act. This was a very controversial issue, and Presidential Clinton’s administration stressed that it any legislation that tried to scale back minority-lending requirements would get vetoed.

The Gramm-Leach-Bliley Act did not get rid of restrictions that were placed by the Bank Holding Company Act which stopped financial institutions and banks from owning any non-financial companies. The Act conversely prohibited corporations that were outside of the finance or banking industry from trying to enter commercial or retail banking. 

Some restrictions have been kept in the Gramm Leach Bliley Act of 1999 in order to maintain some level of separation between the commercial and investment banking functions of a company. The majority of the debate surrounding financial privacy is centered specifically on preventing or allowing the insurance, banking, or brokerage divisions of a company from functioning and working together.

When looking at compliance, the main rules under the Gramm-Leach-Bliley Act are the Financial Privacy Rule. This rule governs the disclosure and collection of personal financial information of customers by financial institutions. The rule also applies to corporations, regardless of if they are financial organizations, who obtain such data. A second major rule is the Safeguards Rule, which requires all financial companies to create, apply and uphold protections to defend customer information. The Safeguards Rule does not only apply financial companies that collect data from their own consumers, but also to appraisers, credit reporting agencies, mortgage brokers, and other financial institutions that obtain customer info from other financial companies.

The Financial Privacy Rule involves having financial institutions provide each customer with a privacy notice given at the time the company establishes a customer relationship and annually after that. The privacy notice has to explain what information is collected about the consumer, how that information gets used, who or where it gets shared with, and how the company protects the information.

The notice also must point out the right of the consumer to opt out of the data being given to unaffiliated parties according to the regulations of the Fair Credit Reporting Act. If the privacy policy changes at any time, the consumer has to be notified for acceptance of the changes. Each time a privacy notice is reconstructed, the customer has the right to choose to opt out. Any unaffiliated parties that receive nonpublic data are accountable to the consumer’s acceptance terms under the original agreement. Ultimately, this rule creates a privacy policy agreement between the consumer and the company that protects of the consumer’s nonpublic personal information.

The Safeguards Rule makes financial institutions responsible for developing and writing an information security plan that discusses how the institution is equipped for protecting client’s personal information and how they plan to continue doing so. This plan must designate at least one employee who will manage safeguards, construct risk management on all departments that handle the information, create a program to secure information and have it monitored and tested, and change any safeguards that are needed in order to be up to regulation.

The purpose of the rule is to protecting the institution’s clients. It forces financial companies to closely examine how they deal with a client’s private data and perform risk analysis on these processes. Because of this, all financial institutions must make an effort to some extent in order to correctly follow the Gramm Leach Bliley Act of 1999.

Website marketing is a form of Internet marketing that envelops advertising and marketing that businesses, marketing companies, professionals, and individuals use to market their goods and services over the internet. Internet marketing can take the form of search engine marketing; search engine optimization; banner ads; and pop-up ads.

There are industries devoted solely to website marketing. As the world of internet business grows, so do marketing and advertising on the internet. Just as companies will have billboards on major highways, companies will put banner ads and pop-up ads on highly trafficked web sites. One of the most profitable ways to make money over the internet is to develop blogs, and other information sources and rely on advertising for income. The more traffic you have coming to your website the more money and more advertisers you will get.

website marketing involves extensive research.  Depending on what the website is that you are looking to advertise on the more expensive the advertisement will be.  Location, location, location applies to, not just real estate in the real world, but also to the internet as well.  There is no point to having your website marketing advertisement soliciting dog food on a webpage for burial supplies.  You should analyze your product and do research on webpages that will most likely lead to traffic for your business.

 

Another tool that is useful in deciding where and when to use website marketing is through a search engine.  Input keywords into search engines that best describe your product.  The websites that come up in the top 10 on search engines are the websites that you will most want to advertise on.  This shows that that website attracts the kind of clientele that will be most interested in your product.

You should not only focus on the website directly, but where on the website your advertisement will be.  Online marketing companies spend countless hours researching where the optimal spots are on a website for advertising to specific clients.  They look to find where peoples eyes move to on a website, what colors, font, and designs people will be more attracted to.

Website marketers advertise on the internet and you can find one through the use of a search engine.  Being that they are in the business of optimizing hits on websites it is probable that the website marketing companies at the top of a search list will be the best ones.  Many of thes website marketing companies promise thousands of hits for around $10.  You should research them, get testimonials and hire the right one for you.

There are advantages and disadvantages to e-commerce and website marketing.  Website marketing is inexpensive in relation to tangible marketing. Where, in real life, their are only so many locations that you can advertise in their are literally infinite possibilities for website marketing over the web. You will have to pay more money depending on the amount of traffic the website generates but either way it is still less expensive than billboards, television ads, and magazine ads. Website marketing has its disadvantages in that most website marketing ads are grouped with a number of other ads on the same page. Where in television and magazine advertising the ad is the only thing on the television or magazine page. In website marketing there may be dozens of advertisements on one website and even though it is there it may not be seen by the audience.

In many situations website marketing must comply with government regulations. The FCC, FTC and other government entities have taken on websitet marketing in the same way as regular marketing techniques. It is a good idea to keep abreast of rules and regulations concerning these matters.

Ending a business or “business dissolution” is not as simple as placing a “closed” sign on a business and walking away.  One must file the appropriate paperwork with government and tax authorities to legally end your business and prevent further taxations from the government.  One must also settle all business debts before walking away from a business for good.

Just as you had to file paperwork to start a business, incorporate an LLC or apply for tax emptions, you must file Articles of Dissolution.  The Articles of Dissolution is a notice to the state or relevant authority, be it city or county to stop taxing your business, as it no longer exists.  The business operations must either be shut down or sold and all debts to creditors and employees must be paid.  The tax authorities will have no way of knowing this and will keep assessing tax unless you go through the business dissolution procedures.  The Articles of Dissolution must be filed with your state’s Secretary of State and you may be charged a nominal fee.

In addition to the government requirements for articles of dissolution, creditors must be informed of the business dissolution, so that they may make arrangements to be repaid, either through the liquidation of remaining assets of other means.  Only after the creditors have been satisfied may the remaining assets from the business dissolution are distributed to those that owned the business.  Employees are also due their wages before dissolution as well.

The IRS has its own set of forms that must be completed to allow business dissolution:

Form 966 is the “Corporate Dissolution or Liquidation” from which must be filed.  This short form will identify the company being dissolved.  This form will require a copy of the resolution that states the shareholders have agreed to dissolve the company.  This will stop federal taxes against the company that you wish to terminate.

In addition to filing Form 966, you must file other income and employment tax returns, as typical until the end of the tax year.  The final tax return will be marked with “final” to inform the IRS that this is the last tax return they will receive on behalf of your company.

A business lawyer can help simplify the business dissolution process, especially for large enterprises with many employees and several creditors.  The business lawyer may charge a flat fee to prepare the documents necessary for business dissolution and may also charge hourly fees for meeting with him or her to discuss you dissolution options.  The business dissolution lawyer will be able to work with all state, local and federal authorities to ensure they are aware of the dissolution and can even work with creditors to ensure they are paid and satisfied with the claims against the business.  The business lawyer will also be aware of additional forms that may be necessary to dissolve certain legal entities, such as LLCs and LLPs.

A business plan is a formal declaration of a business’s set of goals, the reasons as to why they are attainable and the means for accomplishing said goals. A business plan may also contain background information concerning the team or organizational structure needed to reach these goals. 

A business plan may also target changes in branding and perception by the client, customer, tax-payer or community at large. When the business attempts to plan a new venture or partake in a major change to the model, a multi-year business plan is required to elucidate on expected returns for prospective and current investors. 

A business plan is typically constructed by a venture capitalist firm to explain or forecast the following:

• The venture capitalist business plan will provide a means for potential investors and venture capitals to find promising projects.

• The venture capital business plan will focus on a number of qualitative factors, such as the organization of a team

• The more sound the business plan, the better the chances of landing an initial investment—a venture capital business plan aims to secure financing.

A business plan may be internally or externally driven. Externally focused business plans will target goals that are fundamental to stakeholders and other external investors. These types of business plans will typically feature detailed information concerning the organization or team aligned to accomplish said goals. With a for-profit business, an external investor will include customers and investors, whereas in a non-profit model, an external stake-holder will include donors and clients of the non-profit’s model and services. In a government entity, an external stakeholder will include level government agencies, tax-payers and international lending institutions such as the World Bank. 

An internally-driven business plan will target intermediate goals that are required to reach the external goals. These goals will cover the development of new products, new IT systems, new services, a restructuring of the entity’s financial structure and refurbishing or restructuring of the entity’s production bodies (manufacturing plants) or organizational structure. Internal business plans are developed in tandem with a list of success factors or a balanced scorecard—two sources that illuminate the entity’s effectiveness. This enables the success of the plan to be measured using non-financial calculations. Business plans will identify and target internal goals, but will provide only general guidance on how they will satisfy the goals latent in their strategic plans. 

Business plans are used as fundamental decision-making tools. There is no fixed content or structure of a business plan. Rather, the format and content of the business plan is structured by the respective entity’s goals and audiences. 

The business plan utilizes all aspects of the business planning process to cover all processes and procedures attached to the business model, including its operations, human resource objectives, financing, marketing, advertising etc.

For instance, a business plan for a non-profit organization will discuss the relationship between the organization’s mission and how it fits into the tangible business plan. In contrast, a venture capitalist will be concerned about their initial investment, feasibility and their exit valuation. The business plan will be directly linked to the entity’s organizational structure and their short-term—as well as their long-term—goals. 

To properly construct a business plan one must draw upon a wide range of knowledge from a number of business disciplines, including the following: human resource management, intellectual property management, finance, supply chain management, operations management, marketing, advertising and others. It will prove beneficial to view the business plan as a collection of sub-plans; one specialty review for each of the main proponents of the business plan.

The format or delivery of a business plan will depend on the presentation context. It is not uncommon for an entity—especially a start-up business—to have three or four formations for a business plan: 

• A quick pitch can be used to deliver a business plan. These three minute presentations provide quick summaries of the business plan’s executive summary. The “elevator pitch” is typically used as a teaser to spark the interest of potential customers, strategic partners and other sources of funding.

• Another way to deliver a business plan is via the oral presentation. AN oral narrative—coupled with a slide show or power point presentation—is meant to trigger discussion and potential investment. The content of the presentation is typically limited to the executive summary and a few fundamental graphs depicting financial trends and key decision making benchmarks. If a key or new product is being proposed, a separate demonstration of the product may also be included in this presentation.

• A written presentation for external stakeholders is another means to deliver a business plan to a group of potential investors or customers. The written business plan provides a detailed and highly-organized plan that is targeted specifically at external stakeholders. 

• The internal operational plan is a detailed plan to describe the organizing and preoperational details that are necessary by management but may not be of interest to the aligned external stakeholders. These plans possess a higher degree of informality when compared with the other versions that are targeted exclusively to external stakeholders. 

The generic business plan will include the following information:

• The cover page and table of contents

• An executive summary

• A brief description of the business

• An analysis of the business affects the environment and the desired marketplace for the business’s product or services

• A description of the industry

• Information regarding the entity’s competitors

• Market analysis

• A detailed marketing plan

• Operations Plan

• A summary of all managers and executives aligned with the business

• Financial plan

• A series of attachments and targeted milestones

Once you have decided that you would like to open a business, you must record your thoughts within a formal business plan. By doing so, your idea is expressed in a formal and detailed plan; this living document will outline every fundamental aspect of the entity’s operation. 

All business plans are works in progress; they will vacillate and constantly change based on the health and fluctuating goals of your entity. As your business evolves and because it is influenced by outside forces, you must constantly update your business plan. In general, you should construct your business under the following organizational structure:

The first part of the business plan should include your executive summary. The executive summary is the most important section of the plan; it will provide a concise overview of the entire business, along with a history of your company. This section of the business plan will tell the reader where your company is and where you want to take it. Because it is the first section the reader will see, the executive summary must grab the attention of the audience. The executive summary should be constructed after the other sections of the business plan are completed. Remember, this section is a summary, so it is important to finish the other sections first. 

The Executive summary should include the following information:

1. The Executive Summary should begin with a mission statement—this statement will explain the thrust of the business. This portion of the summary can be two words, two sentences, an image or a paragraph. The mission statement should be as concise as possible and should give the reader a clear picture of what your business is about and what it plans to do. 

2. The date the business was formed and the date it officially opened its doors

3. The names of the founders and the explicit functions they perform

4. The number of employees

5. The location of the business and the locations of its branches or subsidiaries if applicable

6. A brief description of the facilities or plants used to produce/manufacture the entity’s products

7. A description of services rendered and products manufactured

8. A summary of your company’s growth including market or financial highlights—what has your company achieved in the last 6-months/1-year?

9. A summary of your future plans.

All above information should be delivered and highlighted in a brief/concise fashion. If you are starting a business, you will not have a lot of information for the above areas. If this is the case, focus on your individual experience and background along with the decisions that led you to create the business. You should also include information regarding the problems your targeted audience has and what solutions you aim to provide. To streamline the business plan—to assist your audience in locating specific sections in your plan—you should include a table of contents after the executive summary. The content titles must be very broad—avoid detailed descriptions in your table of contents. 

Section II of your business plan is Market Analysis. This section illustrates your knowledge concerning the particular industry your business operates in. This section should present general highlights and a conclusion of any marketing research data you have compiled. This section should include the following: an industry description and outlook, market test results, target market information an evaluation of your competition and lead times. 

When describing your industry, you should include the current size of the industry, the historic growth rate and characteristics related to the particular industry. When identifying your target market—your prospective group of customers that you target your product or service to—it is important to narrow the industry to a manageable size. 

Part 3 of the business plan should include a detailed look at how all the elements of your business fit together. The company description should include information about the nature of your business as well as a detailed list of the primary factors that you believe will make your operation a success. 

When you define the nature of your business, you must list the marketplace that you are attempting to penetrate. This description will include the ways in which you plan to achieve your goals through the use of your products and services. Finally, you must list the specific individuals (managers/employees) and organizations that you have identified to achieve these goals. Primary success factors will include an ability to satisfy your customers’ needs, effective personnel, key locations and streamlined methods to deliver your products or services. 

Section IV of the business plan should include the following: your company’s organizational structure, details concerning the ownership of your company, qualifications of your managers and profiles of your management team. 

The following questions should be elucidated on in this section of the business plan: Who does what in your entity? What are the backgrounds of these employees and why do they hold such high titles in your business? What explicit roles and responsibilities do these individuals fulfill?

This section must include biographical information regarding who is on the board and how you intend to keep them motivated and active. What salary and benefits do you offer these employees? What incentives do you offer? What is the typical route for promotion? 

In this section you should provide the reader with an organizational chart with descriptions of each manager. This section should also include information regarding the legal structure of your business along with the subsequent ownership information for each manager. Important ownership information in your business plan should include:

• Names of the individual owners

• Amount of percentage ownership for each individual

• The extent of involvement with the company

• Forms of ownership—do the individuals own common stock, are they general partners/limited partners?

• List of all outstanding equity equivalents (for example, warrants, convertible debts, options)

• Information regarding the issuance of common stock

A crucial element of this section will include information regarding the ability and track record of your owner/management team—you must let your reader know about the key people in your company and their individual backgrounds. When providing information for your key employees/managers, include the following information:

• Names of the individuals

• Positions

• Their primary responsibilities and authorities

• Their educational backgrounds

• Their unique experience and skill-sets

• 10-year history of their employment record

• List of special skills

• Past track record

• Industry recognition

• List their community involvement

• Number of years with your company

• Compensation levels and basis

Part V of your business plan will include information regarding the marketing and sales aspect of your business. Marketing is the process of creating customers, and of course, customers are the lifeblood of your business. The first thing you want to do in this section is define your marketing strategy. There is no uniform way to approach a marketing strategy; the strategy should be part of an ongoing business-evaluation procedure to your company. That being said, there are common steps you can following to help formulate a direction and a series of tactics you should implement to sustain customer loyalty and drive sales. 

• A strategy to penetrate the market.

• A growth strategy for building your business will include an internal strategy to increase human resources effectiveness, an acquisition strategy to streamline the purchase of other business entities, a horizontal strategy to help deliver the same products or services to different demographics, a vertical strategy that will help you to continue to provide the same products at different levels of the distribution chain and a franchise strategy to help your company branch out.

• A channels of distribution strategy will require you to choose between several distribution channels, including an internal sales force, retailers, distributors and/or original equipment manufacturers.

• A communication strategy is necessary because it will help you devise a plan to reach your wider customer base. Typically a combination of the following tactics will work the best: 

Sales Force Strategy: If your business is going to utilize a sales force you will need to answer the following questions: How many salesmen will you recruit for the team? Are you going to use independent or internal representatives? What type of recruitment strategies are you going to utilize? How are you going to train your sales force? How are you going to compensate your sales team?

Sales Activities: When defining a sales strategy, you must compartmentalize the initiative. For example, you will need to identify your prospects and then prioritize the contacts, by selecting leads with the highest potential to buy. After that, you need to identify the number of sales calls you will make for each sale, the average dollar size per sale and the average dollar size per vendor. 

Part VI of your business plan should describe your service or product, by emphasizing the benefits to potential and current customers. You should focus on the areas where you hold distinct advantages and identify problems in your target market for which your products or services provide a solution. Provide the reader with hard evidence that people will be willing to pay for your solution. Provide a list of your company’s products and services and attach any matching marketing materials. Also provide details concerning your suppliers, availability of products/services and costs associated with said products or services.

Part VII of your business plan will require you to request the amount of funding you need to start or expand your business. If it is essential, you may include different funding scenarios, however, you must be able to back up these requests with corresponding financial statements. 

In this section of the business plan, you must include the following: your funding requirements, your future funding requirements over the next three to five years, your plans regarding the use of the funds and a list of long-term financial strategies that you are planning to employ that would have any effect on future funding requests. It is essential, when outlining your requests, that you state your current and future funding requirements. 

The use of your funds is fundamental to creditors. Is the funding request for working capital, debt retirement, capital expenditures, acquisitions, etc.? You must state your motive for securing financing. 

Lastly, make sure that you list any strategic information related to your venture that may have an impact on future financial situations, such as taking your company public, engaging in a leveraged buyout, the method with which you will service your debts or whether or not you will wish to sell your business in the future. 

The last part of your business plan should be developed after you have analyzed the market and have established a list of clear objectives. 

Bookkeeping refers to the formal recording of financial transactions. Bookkeeping will document a slew of transactions, including sales, income, purchases, payments and receipts processed by an individual or business entity. Bookkeeping is typically performed by a professional bookkeeper or accountant; however, the act of bookkeeping is always held separate from accounting. 

Accounting is performed by a licensed accountant; this professional creates reports based on the recorded financial transactions offered by the bookkeeper. The accountant then files these reports/documents with the appropriate government agencies. Accounting practices are mandated to ensure that the individual or business entity complies with tax and business law. 

In general, there are two common methods of bookkeeping: single-entry bookkeeping systems and double-entry bookkeeping systems. 

A single-entry bookkeeping system is a distinct method of bookkeeping that relies on a one-sided accounting style to maintain an entity’s financial information. The majority of entities will record transactions based on the double-entry method; however, a number of small businesses will utilize the single-entry system to record only the “bare essentials.” In these cases, only records of cash, taxes accounts payable and accounts receivable will be recorded and maintained. Other records, including information regarding inventory, assets, revenues, expenses and other elements will not be kept in a single-entry system—this information will be stored in memorandum form. As a result, this system is typically ruled inadequate except where the operation is exceedingly simple and the attached volume is scarce. 

The double-entry bookkeeping system is a set of guidelines for recording financial information where every transaction changes at least two attached nominal ledger accounts. In the American double-entry bookkeeping approach, transactions are recorded based on the following equation: Assets=liability + capital. This accounting equation reveals the equality between the entity’s debits and credits. For the purpose of this equation, all the entity’s accounts are classified into the following categories: assets, income/revenue, liabilities, capital gains/losses or expenses. 

Under this system, an increase or decrease in one account will reflect an equal fluctuation in another account. There may be equal effects in both accounts depending on which accounts are altered or there may be equal decreases to the attached accounts. The following rules in respect to the categories of accounts will be observed:

1. Asset Accounts: Credit decreases in assets and debit increases in assets

2. Capital Accounts: debit decreases in capital and credit increases in capital

3. Liability Accounts: Credit increases liabilities and debit decreases liabilities

4. Revenues/Income Accounts: credit increases income and gains and debit will decrease income and gains

5. Expenses or Losses Accounts: Debit will increase expenses and losses while credit will decreases in expenses and losses. 

In general, the bookkeeping process will refer to recording the effects of financial transactions into accounts. In the course of business, documents are produced each time a transaction is finalized. For example, sales and purchases will be attached with invoices and receipts. Because of this paper trail, bookkeeping will involve the affirmation—via recording—these details of these source documents into highly-organized journals. After a month or so, the columns in these journals are totaled to give a summary for a particular period.