A Small Business for Sale is defined as a commercial endeavor whose purchase is made available to the public. When businesses are offered for sale, the owner is looking to legally transfer ownership to the purchasing party. 

Typically, the purchase of a small business for sale will take the form of one of the following:

• Stock Purchase: The buyer purchases a portion or all of the seller’s stocks. A seller of a small business will prefer this method because the buyer assumes his or her debts and liabilities.

• Asset Purchase: The buyer purchases a portion or all of the seller’s assets. A stock purchase is favored by buyers because they secure the assets attached to businesses for sale—including all of its inventory and equipment—without assuming the seller’s debts and liabilities.

• Merger: Occurs when two combines agglomerate to form a single, new entity. This method is liked—depending on the circumstances—by both the buyer and seller because a merger entails a tax-free exchange of stock in the new company for stock of the previous entity. 

Regardless of the purchase, the transaction will be structured with the following steps:

• Businesses for sale will require a pre-negotiation meeting between the buyer and seller

• A small business for sale will require preliminary negotiations before an affirmed figure can be reached

• The buyers and sellers must draft a formal contract that establishes the agreement to purchase and a pre-closing review

• Closing

During the pre-negotiation process, the buyer and seller of the small business will review fundamental aspects before an agreement can be reached. During this phase, the seller will establish the minimum price he or she is willing to accept for the business and the buyer will establish the maximum price he or she is willing to pay. 

The pre-negotiation process for businesses for sale will also include an evaluation of how the value of the business was calculated. After this is confirmed, the two sides will inspect the seller’s financial condition, including a review of the entity’s balance sheets, profit and loss statements and income/expense balances. 

During the initial phase, the parties will be required to discuss and agree on several matters, including:

• Necessary documents that were not examined during the pre-negotiation phase, such as federal and state income tax returns, property/equipment leases and employment contracts. 

• Is the approval of the board or shareholders necessary to finalize the sale?

• Is government approval required? Is a certificate of good standing (indicates that a business for sale was properly formed and authorized to conduct business) necessary?

• Will any employees be retained by the owner of the small business for sale? If so, the buyer will have to draft new employment contracts; if not, the seller will have to provide compensation to those employees.

• Are there any contracts which require third-party approval before the purchaser can assume control over them?

After this review, a letter of intent is typically constructed. This document will show that the buyer and seller are serious about the engagement. The letter of intent affirms the agreement; however, they are typically instituted as non-binding contracts. That being said, portions of the LOI may be enforceable; a letter of intent should contain the following information:

• The length of time the buyer and seller are willing to keep the deal open

• A guarantee by the purchaser not to disclose confidential information ( such as trade secrets and customer lists) to third parties or the public—this is known as a confidentiality agreement

• A guarantee by the seller not to negotiate with other prospective buyers for a certain period of time.

When the two parties assent to the above stipulations and issues, the formal agreement and pre-closing period can commence.

A final agreement is the culmination of the aforementioned negotiation periods. The agreement must contain all the details of the transaction: the sales price, when ownership will be transferred, etc. Typically the agreement will be produced in several drafts—it is not legally affirmed until it is signed by both parties. 

During the pre-closing period, the following details must be discussed and reviewed:

• Both parties must count and inspect all inventory associated with respect to businesses for sale

• Both parties must inspect all leases, contracts and loans—these must be assigned to the buyer of the small business for sale

• A bill of sale for assets must be constructed if the goods are being sold

• The parties should arrange for escrow—a third party will hold the funds used for purchase until all conditions of the sale have been met

The closing period denotes the completion of the deal. During this time, both parties should review the following:

• Make sure all documents are signed and notarized where required

• For the buyer: disburse the proceeds by paying the underlying creditors, government (for unpaid sales taxes), the escrow agent (if applicable) and the remaining balance to the seller. 

• Record all documents (deeds, titles and certificates) for record keeping.

A Small Business for Sale may exist in a variety of classifications with regard to the status of the business subsequent to the sale; while one Small Business for Sale may be sold in the form of an idea or a business plan, another Small Business for Sale may be in an operational state immediately after purchase:

 ‘Startup’ Small Businesses for Sale are considered to be a commercial endeavor available for purchase, whose availability occurs during the earliest stages of business development; this can range from mere business plans outlining a business structure to commercial activities within their premature organization

‘Turnkey’ Small Businesses for Sale are defined as a commercial endeavor available for purchase in a state of operation, which typically will not require startup costs or developmental administration; the term ‘Turnkey’ spawns from the notion that the purchaser of this Small Business for Sale will have the ability to initiate the operation of the business immediately after purchase:

The Fair Work Act of 2009, which is comprised of regulations set forth by the United States Department of Labor (DOL), states that a Small Business for Sale is classified as a business – or commercial activity – available for purchase within which the following classifications apply:

A Small Business for Sale will typically be privately owned

A Small Business for Sale will typically have an employee base not exceeding 15 individuals

A Small Business for Sale will typically render and incur a profit margin and earnings reports that are substantially smaller than those belonging to middle and larger sized businesses

Subsequent to purchase, a Small Business for sale is subject to applicable taxation requirements, which include employees, provide benefits, and liabilities undertaken by the Small Business:

IRS Form 8829: This form is used in order to claim any expenses that are incurred as a result of operating a self-employed Small Business for Sale subsequent to its purchase; typically, this form is specific to online-based Small Business conducted from one’s home or residence

IRS Form 1040: This form is a standard form used for filing taxes applicable to a Small Business for Sale subsequent to purchase; line 30 on this particular form entitled ‘Schedule C’ allows the owner of an small business purchased in order to substantiate profits or losses as a result of operating an online-based small business within the realm of self-employment

Schedule C – EZ: Subsequent to purchase, a Small Business for sale employed to operate from a residential base of operation – reporting business expenses not exceeding $50,000 – will be required to satisfy this tax form

Human resources is a broad term used to describe the individuals who comprise the workforce of a business entity—this definition is also attached to the term “human capital”. More specifically, human resources (commonly simplified to HR) is the name of the function within a business entity charged with the responsibility for implementing policies and strategies relating to the management of individuals (the human resources). 

A business entity’s HR management model attempts to maximize return on investment regarding the organization’s human capital. The HR management strategy, while attempting to streamline the function of individual employees, also attempts to minimize financial risk. 

A human resources manager will seek to achieve these goals by aligning the supply of qualified and skilled individuals and the capabilities of the entity’s current workforce, with the organization’s future business plans and requirements to achieve an efficient return on investment. 

To ensure these objectives are achieved, the human resources department will implement an organization’s human resources requirements, taking into account all laws (federal, state and local labor) and regulations which regulate the entity. 

A human resources department may develop policies, systems and standards that implement the department’s basic strategy in a variety of arenas. The following roles are typical for a human resources department in a wide range of industries and business models:

• An HR department will maintain awareness concerning compliance with local, state and federal labor laws.

• An HR department will recruit, interview, select and board resources—including the processing of new employees

• The human resources department is responsible for all employee record-keeping and confidentiality functions

• The human resources department will help with the organizational design and development of the business entity

• The human resources department will oversee performance, conduct and behavior of the entity’s employees

• The HR department will process new employee applications, payroll and employee benefits

• The HR department will institute and oversee training and development of new/current employees—this process is referred to as “learning management”

• The HR department will bolster employee motivation and the morale of the workforce—these functions aim to augment employee loyalty and retention

The implementation of the above policies may directly managed by a company’s HR department, or the functions may be indirectly supervised by managers or third party organizations. 

A human resources department is a fundamental component of employee well-being in any organization, no matter the industry or the size of the entity. Responsibilities of the HR department include all of the above and issues concerning hiring, firing and complying with state and federal tax laws. Furthermore, a company’s HR department is integral part of the organization’s risk assessment department. Aside from complying with local, state and federal labor laws, the human resources department will engage in safety inspection, dispute resolution and the filing of workers’ compensation—all rules and regulations that govern a particular business organization will be affirmed through the delivery of an employee handbook, which of course, is constructed by an HR department. 

Self employment refers to working for one’s self; a self-employed person works for him or herself instead of an employer. A self-employed individual’s income is attained through trade or business that the person operates personally. The business of a self-employed person is personalized; the business is the individual’s primary source of income.

The terms “self-employment” and “business owner”, although universally linked, are by no means identical in meaning. A business owner is not required to be active or hands-on with the daily operations of his or her company, whereas a self-employed individual must utilize an aggressive and hands-on approach to secure income. 

The United States Government views self-employment as a form of rudimentary entrepreneurship. Because a self-employed person is extremely active in the day-to-day operations of the business, most entity’s run and operated by a self-employed person are extremely small and niche-based. 

In the United States, an individual is considered self-employed (for tax purposes) if that person is actively operating a business as an independent contractor, a sole proprietorship, as a member of a limited liability company (only if it does not elect itself to be treated as a corporation) or as a member partnership. In addition to its tax classification, a self-employed individual must pay Medicare and Social Security taxes, as a result of the Self-Employment Contributions Act. 

In the United States, the self-employment tax is typically set at a flat-rate equivalent to the combined contributions of the employer and his or her employee under the FICA model. The self-employment tax is currently set at 15.30% (The 2010 Tax Relief Act reduced this figure to 13.3%, but the rate will increase back to 15.3% at the start of 2012); this rate consists of two parts: 12.4% is based on the self-employed individual’s social security responsibility and 2.9% is applied to the Medicare tax.

The social security aspect of the self-employment tax, in a hypothetical fashion, can be deducted by 50% against the individual’s self-employment income. Because of this deduction, only 92.35% of self-employment income is taxed at the 15.3% rate, deriving an effective tax rate of approximately 14.1%. However, this tax deduction will be terminated if the individual’s self-employment income exceeds $105,577 (this figure may change year-to-year, since the whole applicable amount of approximately $97, 5000 will be taxable at the 15.30%. 

A self-employed individual will typically declare more deductions than an ordinary worker. Equipment, travel, uniforms, car use, cell-phone use etc., can be deduced as self-employment business expenses. Self-employed persons are required to report their business income (or losses) on IRS Form 1040 within Schedule C. Self-employment taxes are calculated on Schedule SE of IRS Form 1040. Self-employment estimated taxes must be fulfilled quarterly through the use of IRS Form 1040-ES if the individual’s estimated tax liability exceeds $1,000.

A self-employed individual is not permitted to contribute to a tradition business-run 401K plan. That being said, self-employment enables an individual to save for retirement in a variety of forms, including the Simplified Employee Pension Plan IRA (25% of their income can be contributed or approximately $50,000 per year) or the Self-Employed 401k or SE 401k. 

A short term loan is a form of financing that is attached with a quick repayment schedule—short-term loans may have a maturation period as short as 90 days. The fulfillment of the loan is dependent on the amount of financing; however, all short-term loans possess maturity dates that are significantly shorter than regular loans. 

The repayment schedule associated with the financing is the distinctive characteristic of short-term loans. Unlike regular loans, which commonly have repayment schedules of 30 years, a short-term loan must be repaid in a much shorter timespan (between 90 days and fifteen years) or immediately after the borrower achieves satisfies his initiative for securing the short-term loan. For example, when a business secures a loan to keep afloat while awaiting customer pay for a service, a lender would expect repayment as soon as the company receives pay from their clients or customers. In contrast, a short-term business loan delivered to a company for inventory shortfalls would be repaid as soon as the inventory is sold off. 

Short-term loans are provided to businesses or individuals in need of quick financing—the funds are utilized to satisfy a payment, off-set a loss or to relieve a cash deficit problem. As a result, all initiatives tied to this loan schedule are used to alleviate shortcomings in the short-run; short-term loans are not used for long-term financing needs.  

The primary benefit of these loans is that they are immediately delivered, enabling the borrower to operate with increased liquidity. Moreover, because of their brief repayment schedules, short-term loans do not require serious commitment—the borrower is not indebted to the lender for a significant period of time.

Fast business loans are appropriate for both existing and new businesses. In regards to new businesses, banks or lending institutions will grant short-term business loans over regular loans because they are less risk—short-term loans provide less money at higher interest rates. Before short-term loans are granted, a lender will review the company’s cash-flow history and payment track record. Typically, short-term business loans are unsecured; they do not contain collateral and the bank relies solely on the borrower’s credit history and credit score.

The primary negative aspect associated with short-term loans is that this method of financing is more susceptible to default. This increased vulnerability results because of the loan’s conditions: short term loans have higher interest rates, shorter repayment dates and higher penalties if a default is realized. 

Short-term business loans are dependent on your credit history and the repay capability of your business—these variables will affect the conditions (interest rate, repayment date and associated fees) attached to your short-term loan. 

Short-term business loans can stretch as far as 15 years; however, lenders are likely to giver shorter term loans to new or unproven businesses. Short-term loans are typically used to pay off the business’s emergency financial obligations.

Email marketing is an important tool in any online business.  Email marketing entails sending online users e-mail notifications about your product or service in the form of advertising.  Studies have shown that other than search marketing.  Last year alone businesses spent over $400 million on Email marketing to get their product or service out to the consumer.

There are a number of reasons to perform Email marketing.  Sending e-mails to prior customers helps keep them abreast of new products and sales.  Email marketing is a wonderful tool for developing customer loyalty and repeat business.  You already know that the individual receiving the e-mail is a potential client due to their previous business relationship with you.

Email marketing is also used to develop new customers through random bulk e-mailing to individuals who, through research, have been shown to be potential clients.  Email marketing also takes the form of advertisements found in e-mails from other businesses that already have a relationship with the e-mail recipient.  

There are many advantages to Email marketing.  First, and foremost, Email marketing is inexpensive.  In comparison to the amount of money it costs to send out flyers and letters through the mail, Email marketing is extremely cheap.  You also have a wealth of potential consumers through the internet.  By using Email marketing you can access clientele throughout the U.S. and the world.  Other forms of marketing do not make this option possible.  

There are disadvantages associated with online marketing.  More than 50% of e-mails received by potential clients through Email marketing are lost due to incorrect e-mail information and spam filters.  Even when an e-mail does go through it is much easier for a person to, either intentionally or unintentionally, ignore or delete these e-mails.  A tangible letter is more likely to be, at least, looked at than an e-mail advertising a product or service.  

When you are performing online marketing you should be abreast of laws and regulations, both in the United States and, if you are Email marketing overseas, the laws of other countries.  The United States Controlling the Assault of Non-Solicited Pornography and Marketing Act requires certain procedures when sending e-mails for the purpose of soliciting business.  Penalties for violations of the law can be $16,000 for spamming per recipient.  There are guidelines that you should know, including laws requiring Email marketing to stop at the request of the customer, among others.  You should contact the FCC, FTC or other appropriate government agency so that you can be aware of these regulations.  If you are unaware of them and you violate the laws you will be penalized.  Ignorance of the law is not a defense.

Social media has been defined as “a group of internet based applications that build on the ideological and technological foundations of web 2.0 that allow the creation and exchange of user generated content.” Social media Marketing is an online marketing tool that businesses, entertainers, charities,  politicians, and professionals use in order to get their product or service out to the public through advertising, blogs, “pages”, videos and numerous other forms.  The internet has surpassed television and radio as the number one marketing tool for advertising.  It is low costn and the ability to reach customers is open and infinite.

Social media marketing takes advantage of social media networks such as facebook, twitter, myspace and others in getting information about a product or service into the stream of commerce.  Social media marketing takes on many forms.

Marketing strategies involving social media marketing are somewhat easier to perform than traditional marketing.  Facebook, for example, is essentially a marketing researchers dream.  Every individual on facebook has pictures, profiles, and status  updates that can help a social media marketer discover everything they would want to know about an individuals propensities to purchase certain products or services.  It is simple for social media marketing to pinpoint what individuals should be solicited with advertisements for different products.

Some of the greatest beneficiaries of online marketing strategies are entertainers.  When you press “like” on a certain musician or entertainers “page” you are letting them know that you are a potential customer and they will then be able to easily and efficiently send you information about concert dates, new albums, and other important information about that subject.

Social media marketing is a great tool for businesses because when advertising is done over social media marketing it is essentially coming from a trusted third party source.  Where an individual may ignore an advertisement sent to them directly from a business through the mail, e-mail, or website advertising; social media marketing is displayed in a way that gives the impression that the social media network believes that the information would interest you when in reality it is a marketing technique.

SEO marketing, short for Search Engine Optimization, is an online marketing strategy used to optimize the number of “hits” that a business, or website, will receive when an individual inputs product, or service, specific data into a search engine.  Search engine optimization requires research on how search engines work; what people search for; and manipulating search engine algorithms to result in the business, or website, appearing higher up in the search engines list of websites that the consumer will find helpful.  

The most prevalent form of search engine optimization is the use of “keyword” manipulation.

When using this technique you must first build a list of keywords that you think people will use to search for your product. This entails that you think like your consumers. What keywords best describe your business?; are there keywords that are associated with your niche that individuals may use while searching?; Take advantage of other products and websites within your niche. For example, if you were in the business of selling soda over the internet it would be a good idea to have the name “coco-cola” within your website. Famous trademarks can be used to your advantage. Although, in this situation, the traffic that your website will receive will include many people who are searching for “coca-cola”, because you are in the same niche, you may be able to win some customers.

Take advantage of Wordtracker in refining your keyword search. Wordtracker is an SEO marketing tool that compiles a record of the number of times specific keywords are used on the internet. By using this SEO marketing tool you will be able to get a better idea of what keywords and phrases you should use in your business.

You should look at your competition. Go to their webpages and find out what keywords they are using; are their ways to make your keywords different to reduce the chances of a potential customer going to someone else’s site. Also take advantage of pay-per-click services to determine if your keywords are getting the amount of traffic you want. Finally, once you’ve come to the decision of what keywords and phrases are best suited for your business you should develop your web content around them.  

There are a number of resources for seo marketing that can be used directly from search engines.  Major search engines have directories to help seo marketing companies plan strategies for optimal hits.  The Yahoo directory, Open Directory Project and Google Webmaster Tools are optimal sources for seo marketing.

There are entire corporations that do solely research on SEO marketing.  They collect data on what words and sequences are inputted into search engines. They help e-businesses design their websites to generate maximum e-traffic.

Other methods of SEO marketing include crawling and cost per click, where an SEO marketing company will pay a search engine to help optimize their hits and pay a certain amount of money for each time that someone accesses their website through the use of that search engine.  SEO marketing also involves cross linking and constant updating.  As changes in business strategies, news, media, and other information change it is more likely that people will be searching for that information.  For example, when Lindsay Lohan was sentenced to prison it was a hot new source.  A good SEO marketing company would go through their related content and update their information to take advantage of the swarm of individuals looking for information on that topic.

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.

There are a number of reasons to choose either a sole proprietorship or LLC not the least of which is distinctions in terms of taxation.  Your decision in the matter is not final as a Sole Proprietorship can eventually become an LLC.

A sole proprietorship is a simple arrangement where the individual and business are one.  The owner is responsible for all debts and assets and there are no distinctions between the entities.  The owner is taxed for the business as a part of his or her individual assets.  Since the owner has full ownership of the business assets and debts, excessive debts also imperil the personal assets of the owner, as there is not distinction under the law.  A sole proprietorship is a good idea for those that do not require financing of immediate capital, do not intend to have many employees, can ensure continuity if the owner is deceased.  One should be careful to make distinctions between business and personal assets in this arrangement and organize the two to ensure the protection of personal assets in the event of issues with the business.

An LLC is considered a flow-through entity when the income is not taxed as the income goes directly to the partners who are in turn, taxed on their income.  This differs from a sole proprietorship in that the business assets are accounted for separately on an IRS K-1 form, yet still taxed from the owner’s personal income.  An LLC benefits the owner by distinguishing business assets, which will give creditors better assurance that sufficient protection is in place to extend lines of credit to the business.  A personal guarantee to repay is no longer necessary and LLCs allow for the addition of other partners that can leverage assets and split liabilities to help expand the business.  Unlike a sole proprietorship, records of the business must be kept separate from personal finances, which provide better transparency for employees and potential investors.

LLCs can chose their classification for taxation, either as a partnership, corporation or separate entity, each subject to their own taxation laws.  In terms of sole proprietorship vs LLC, this is a highly flexible benefit of LLCs, although sole proprietors will have a simplified tax structure as well, only requiring a self-employment tax form.

The decision to choose either a sole proprietorship vs LLC depends on the needs of the owner.  Those requiring complex payrolls systems and have a need to expand their business while attracting investment will want the legal legitimacy afforded by an LLC.  Those that also seek to add partners and spread liability will certainly need an LLC.  Tax benefits increase marginally as more individuals join an LLC and choose the appropriate method of taxation.  Those that intend to remain small while avoiding payroll taxes and do not have a need for expansion or investment can remain a sole proprietorship.  Those that do so accept the possibility of liabilities extending from the business and the potential for personal assets to mix with business assets.  

When you are starting your own business it is important to have a business plan set up to help direct the success of your business.  What is also important, that many small businesses don’t consider, is a Business Continuity Plan.  A Business Continuity Plan s set up for all contingency circumstances revolving around the success of your business.  Many problems can occur through the course of running your own business, both natural and man made.  If you are operating your own business it will only be a matter of time before your Business Continuity Plan will have to go into effect.  It may happen tomorrow or it may happen 20 years from now.  Many people believe there is no such thing as luck, only preparedness.  When disaster hits you should have a Business Continuity Plan set up to prevent your business from going under.

Probably one of the most famous Business Continuity Plans resulted in the formation of the Bank of America.  In 1904 Amadeo Giannini founded the Bank of Italy in San Francisco, California.  The goal of the bank was to make small loans to immigrants who were denied by other banks.  The Bank of Italy did not possess a fire proof safe and when the San Francisco earthquake occurred in 1906 Giannini was forced to return to the bank and take out all of the money before the fires reached the Bank of Italy.  All of the other banking institutions in San Francisco had fire proof safes.  Where the fireproof safes prevented the fire from consuming the contents of the safes they were incapable of being opened for days because they needed to cool down.   After the earthquake Gianinni was the only person in the city of San Francisco who was capable of making loans to individuals for repairs.  Because of his ability to finance the rebuilding of the city, Gianinni’s business thrived and eventually became, what is known today, as the Bank of America.

Where Gianinni’s Business Continuity Plan was not done on purpose this is a great example of how to prepare for disasters and the result of poor planning.  The other banking institutions did not think about the result of an overheated safe, and for that reason, they were damaged financially.

When creating a Business Continuity Plan you should contemplate your business exposure to internal and external threats.  The first step in creating a Business Continuity Plan should be to assess your business essential aspects and gauge what are the most important and fundamental operations of your business.  These should be listed in order of priority and assess what backup, and contingency, arrangements should be made for the failure of each one.  

There are many issues that can arise through the course of a business that can cause your business to suffer loss or become insolvent.  These include: Theft, natural disasters, looting, damage to inventory and equipment, fire, changes in the financial market and many others. 

You should prepare for each situation appropriately; prioritize certain aspects of your business over others; do cost analysis comparing the costs of the business continuity plan versus the value of the asset to the company.  For example, the theft of inventory from the store may have less of an impact on your business than the destruction of your business due to fire.

Business continuity plans can consist of backup generators, security systems, backup machinery and equipment and insurance.  Each business will have a different business continuity plan and you should consult with a specialist in these matters to assess how you should fully prepare for any worse case scenario.