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Why are Marketing Ideas Important?

Why are Marketing Ideas Important?

Marketing ideas are the lifeblood of keeping your business relevant and help you to reach clients that you may otherwise not be exposed to.  While all businesses engage in some sort of marketing, it is the unique marketing ideas that keep businesses ahead of the pack.  When you come up with marketing ideas that differ from traditional methods, your business can be put in a position to really out maneuver the competition.  
How to come up with Marketing Ideas for you business

1. Identify your products, services, and clients
The most basic step before coming up with unique marketing ideas is to examine what you provide and who you provide them to.  Try to ask yourself, what makes my product or services unique? Why should my client base choose my business over my competitors? What type of clients do I have?  Only when you have fully identified everything about your business structure can you start to create new marketing ideas. 

2. Evaluate your budget
Many marketing ideas that would serve any number of purposes for your company can be through of, however often budget constraints restrict which ones you can use.  Consider what your marketing budget is and how it can best serve you through your client base.  Budget constraints are very important, so do not break them unless you are completely sure that you have developed marketing ideas that will bring in more revenue than they cost.  

3. Marketing Ideas
Once you have your ground rules for your products, clients, and budget restrictions, you now must consider different marketing ideas.  Some marketing ideas include the following:  Building a referral network can greatly increase the amount of clients to you have and your business relationship with other businesses, post your services in public places and pass out business cards whenever possible. 
The internet can provide a host of marketing forms.  Building a website can be the first step, but you can also use search engine optimization and link your website to content pages in order to direct traffic to you.  You can even do some non-traditional forms of marketing, such as putting up viral videos of your business, hosting competitions, or combing the internet with real world advertisements.  

4. Putting your Marketing Ideas into effect
Finally, once you have put your marketing ideas into a plan, you must implement them into action. Start by drafting your plan which will consider your client base, your overall business plan, and what mediums you will use to get your brand and advertisements to the client.  
Start by contacting the media services that you will need, allocating budget funds to pay for the marketing, and finally monitor how your marketing ideas are having an effect.  If you notice that your marketing ideas are not working or not being received well, you should not hesitate to modify them or pull them from your marketing plan.  

Marketing Ideas for specific businesses
Marketing ideas are not all one size fits all for every type of business.  Instead, you must evaluate what forms of marketing will best suit your company.  Retailers, who are trying to garner the attention of the general public, need to focus on their specific brands they offer, their pricing, and their image.  Therefore, it is important for retailers to have exciting visual marketing ideas, such as television commercials, print ads, and exciting websites.  
Professional services or other similarly situated businesses need to reach the specific consumers who require their products, but cannot use loud marketing ideas.  Instead, they should use more subtle and serious outlets for advertisements.  Their websites should be serious and informative and any visual advertisements showing that your business has experience, prestige, and a hard work ethic.  

Legal Issues
Always check to ensure that any marketing ideas you come up with do no violate trade or advertising regulations.  These regulations vary greatly depending on your industry, where your business is located, and how you plan on contacting consumers.  If you are unsure of the legal status of your marketing ideas, consult a legal professional who has experience working with business clients helping them adapt their marketing techniques to meet regulations.  

Everything You Should Know About a Small Business

Everything You Should Know About a Small Business

What is a Small Business?
 
 
A Small Businessis classified as a commercial endeavor that is operated on a smaller scale than its commercial counterparts. Although there does not exist a definitive parameter with which to qualify a business as a Small Business, a 
 
 
Small Business will typically retain an employee base ranging from 1 to 15 individuals; furthermore, a Small Business will typically report lower amounts of revenue in contrast with larger businesses and corporations – with regard to the classification of commercial activity as a Small Business, the following are common examples of Small Businesses:
 
 
A Home business can be classified as a small business; a home business operating as a Small business typically involves the formulation and accomplishment of a multitude of tasks taking place within the home of the founder
 
 
An Internet business can be classified as a Small Business; due to the fact that maintenance of an online-based commercial endeavor can be conducted through the Internet, offices and large employee numbers are not always required
 
 
What is an Online Small Business?
 
 
Since the development – and subsequent advancements latent within Internet-based commercial activitytaking place through the internet marketplace – of ‘E-Commerce, or electronic commerce, Small Business opportunities can includethe provision of products and services available purchase and delivery through online-based commerce; the following are some examples of the most common types of online-based Small Business activities:
 
 
Web design, domain management, online consultation, and marketing development
 
 
The production of freelance media; this can include editing, writing, proofreading and research conducted on a ‘per-project’ basis
 
 
The manufacture, production, sale , and management of products or services; in many cases, this type of vendor-based Small Business will act as a third-party between buyers and sellers
 
 
Types of Small Businesses
 
 
A Small Businesscan include the provision of products or services conducted using one’s home or residence as a base of operations or an ad-hoc office. Individuals who engage in starting a Small Business may utilize their homes in order to eliminate start-up costs with regard to commercial activity and business endeavors; the following are some common types of products and services offered by in-house Small Businesses:
 
 
Consultation services, event planning, analysis, and project management
 
 
The provision of educational workshops, classes, lessons, and instruction; these may be conducted from one’s home
 
 
Home-based product assembly, manufacturing, and management
 
 
Retail-based commercial activity; this includes, vending, resale, wholesale, and consignment
 
 
Small Business Taxation
 
 
A Small Businessis subject to any and all pertinent taxation requirements; a Small Business that maintains employees, provide benefits, and possess liabilities must satisfy applicable tax documentation:
 
 
IRS Form 8829: This form is used in order to claim any expenses that are incurred as a result of operating a self-employed, online-based Small Business conducted from one’s home or residence
 
 
IRS Form 1040: This form is a standard form used for filing taxes; line 30 on this particular form entitled ‘Schedule C’ allows the owner of an internet-based smallbusiness to substantiate profits or losses as a result of operating an online-based small business within the realm of self-employment
 
 
Schedule C – EZ: This form is designated for a Small Business operating from a home or residential base of operation(s) that reports business expenses not exceeding $50,000

Investigations Continue Into Plywood from China

Investigations Continue Into Plywood from China


On November 9, 2012, the International Trade Commission (USITC) announced that continuing investigations allege that hardwood plywood from China was subsidized and sold for less than fair value in the United States.  All six Commissioners with the USITC agreed that investigations should continue.  


Hardwood plywood and decorative plywood is made when two layers of wood veneer are glued to a core of medium density fiberboard, particleboard, oriented strand board, or other types of lumber.  The core is usually made of oak, birch, maple, poplar, or bamboo, and the wood is used on furniture, cabinets, underlayment, wall paneling, and more.  


The Coalition for Fair Trade of Hardwood Plywood petitioned for the following individual members:


•    Columbia Forest Products in Greensboro, North Carolina
•    Commonwealth Co., Ltd. in Whitehall, New York
•    Murphy Plywood in Eugene, Oregon
•    Roseburg Forest Products Co. in Roseburg, Oregon
•    States Industries LLC in Eugene, Oregon
•    Timber Products Company in Springfield, Oregon


There were a total of 20 producers affected by the possible fair trade violations, and these producers are located in the following states: Arkansas, Illinois, Mississippi, New York, North Carolina, Ohio, Oregon, Pennsylvania, South Carolina, Virginia, Washington, and West Virginia.  There were a total of 1851 employees with the affected producers.  


U.S. consumption of the plywood products was an estimated $2,014,000,000 in 2011, and about $707.3 million of U.S. imports involved hardwood plywood from China.  China exported the most plywood to the United States, for other countries only imported $632.7 million of similar products in 2011.  


It is important to note that the investigation does not involve structural plywood, plywood used for cork faces or cork backs, multilayered flooring used for CVD/AD order, or other types of plywood that are used for anything besides basic finishing.  


Source: U.S. International Trade Commission

Understanding the Law Behind Payroll

Understanding the Law Behind Payroll

Payroll is the total of financial obligations to employees in terms of salary, bonuses and deductions for services such as transit reimbursement and health insurance.  The effective functioning of payroll ensures that a business remains running optimally, which necessitates the hiring of additional personnel to perform payroll services in larger companies to manage payroll and ensure its timely and accurate payment.  Without effective payroll management, employers can be prone to mistakes, noncompliance with the law and a host of legal liability issues.  The employer is mandated by law to keep accurate records of employee payroll as well as make the appropriate tax contributions.

What are payroll taxes?
Payroll taxes are deductions made by the employer on behalf of the government to fund entitlement programs as well as income tax.  Payroll services personnel may be needed to ensure compliance with state and federal laws on tax withholding laws.  Taxes paid from payroll into Social Security and Medicare is matched by employers.  Given that payroll taxes are usually an intersection of federal, state and local law, compliance can be difficult.  Often there are a number of deductions for state disability, unemployment insurance as well as school and other programs that are held in trust.  It is the responsibility of the employer to be in compliance with tax laws and hand over the withheld taxes to the government.
Employers are responsible for the following payroll taxes:
Social Security (6.2%)
Medicare (1.45% of wages)
Federal unemployment taxes
State unemployment taxes
Under the Federal Insurance Contributions Act half of contributions to entitlement programs are paid by the employer and the other half by the employee.


What are payroll laws?
There are a number of payroll laws and some laws may vary by state:
Minimum wage – although there is a federal minimum wage law, some states, like New York will require an even higher minimum age.  
Overtime – the Fair Labor Standards Act mandates that overtime pay must be made when an employee exceeds forty hours worked in a week.  Any subsequent hours worked must be compensated with “time and a half” pay.  Exceptions include domestic workers that live with the employer who have a higher threshold for overtime.  Certain other employees are not eligible for overtime such as salespersons, computer professionals and certain administrative or professional workers.  A payroll or labor lawyer will be able to determine which employees are exempt.
Payroll tax – employers are obligated by federal law to withhold the above mentioned payroll taxes
Frequency of pay – employees are generally paid biweekly, but other arrangements include seasonal, daily, monthly and in some rare cases, semiannually or annually.  Payroll taxes will be scaled to match this payroll period.

What are payroll services?
For smaller businesses that cannot afford to have full time personnel managing payroll, specialized payroll services exist with payroll software and trained professionals that keep track of payroll laws and changes that affect how payroll is disbursed to employees.  Some payroll services may provide further services typically provided by human resources personnel such as tracking benefits plans.  Payroll services offer a number of ways to disburse salary, usually through checks sent to the employee, but also newer options, such as direct deposit.  Payroll services can also provide pay stubs to employees, although this is not required by law.  Pay stubs are useful for an employee to keep track of the taxes withheld as well as earnings to date.


What is payroll software?
Small businesses may decide to use payroll software to automate their payroll needs.  This software can calculate deductions and create paychecks as well as manage benefits plans.  There may be issues with keeping the software current, which will lead many payroll software makers to offer live support, automatic updates, or ancillary payroll services to augment the payroll software made available to small businesses.

IFRS (International Financial Reporting Standards)

IFRS (International Financial Reporting Standards)

What are the International Financial Reporting Standards?
The International Financial Reporting Standards are a set of accounting principles that provide guidelines for the proper reporting of financial data.  The standards of the IFRS are set by the International Accounting Standards Board in London, United Kingdom.  The standardization of the principles of accounting ensures the transferability of financial reporting standards between countries as the lack of such standards would mean that financial data would not be accurate and readily understood by a company or investor in a different jurisdiction or country that the reporting company is located at.
Although the United States currently abides by the Generally Accepted Accounting Principles (GAAP), the US has begun to change accepted accounting principles and standards to the International Accounting Standards Board, in order to standardize its accounting principles with the principles used by the rest of the world.  If completed on schedule, this change will happen in 2014.  Principles of accounting must be standardized to provide the best possible information for potential investors as well as allowing for the finances of two companies to be compared.

What are the characteristics of financial statements under the IFRS?
The core tenants of the IFRS are to make financial statements reliable, clear and comparable to other statements.  This is the reason for instituting a dedicated framework for all businesses to report finances, much in the way a unified currency streamlines purchasing decisions across national borders.
Financial statements under the IFRS must contain the following elements:
Statement of Financial Position – this is a balance sheet that reports on the financial condition of a company and expresses its net worth at a given point in the year.  The balance sheet will have three parts, consisting of assets, liabilities and equity.  The assets are listed first with the assets that are easiest to liquidate and the top of the sheet.  Assets listed include cash, accounts receivable and equipment.  Liabilities will include accounts payable.  Equity will include stocks and earnings.
Statement of Comprehensive Income – the owner must list all items contributing to profit and loss and the net income when accounting for the profit and loss factors.  This includes revenue, tax payments, and financing totaling up to the comprehensive income.
Statement of Changes in Equity – this statement shows the comprehensive income and other changes in equity, such as investments by the owners, dividends and withdrawals of capital.  This statement is optional if there is no change in owner investment or any of the other changes in equity.
Cash Flow Statement – A cash flow statement is an accounting document that specifically assesses the amount of cash that is handled by a business and the ultimate destination of the infusion of cash.  Cash flow statements are usually needed for financing to prove to lenders that companies have adequate cash flow to satisfy repayment demands.  Cash flow statements are also released to shareholders and potential investors do that they may judge the short and long term financial health and flexibility of the company.

Accounts Payable: Your Quick Guide

Accounts Payable: Your Quick Guide

Introduction

Accounts payable is a business record of amounts owed to other entities for goods and services already received or utilized.  Account payable services are critical for most companies as it expedites the delivery of items while waiting for payment options to process.  Most Americans receive accounts payable service every day, usually in the form of utilities where a bill is sent for usage after their usage of the good has been determined and quantified.

How does accounts payable work for businesses?
The key to accounts payable is the cash conversion cycle that determines how long it will take for the business entity to receive payment for products and services.  A company that suffers from poor cash flow will lose flexibility in inventory management, paying and maintaining relationships with suppliers and delivering more products to other potential clients.  To ensure the continued flow of cash, organized accounts payable is necessary to ensure that accounts are settled with suppliers through the expedited payment of invoices.  Accounts payable will work in conjunction with accounts receivable to ensure that company cash flow remains stable and flexible and that excessive debts are not outstanding or uncollected.
Among the important functions of accounts payable is invoice processing.  After the accounts payable department determines that the invoice is legitimate and matches a purchase order, it is forwarded to the employee in charge of invoices of the same type.  In large entities, this may be an entire department in accounts payable devoted to sorting invoices of specific types or vendors.  If there is no verification system in place to determine if the invoice is legitimate, then the invoice is typically passed to the person that orders the goods or service who must then match the item to a purchase order.  After this is fulfilled, the invoice is returned to accounts payable, where payment to the vendor will be arranged, usually through a prior approved system.

What are the responsibilities of accounts payable personnel?
In especially large enterprises, controls to prevent fraud are often lacking.  As such, many of these entities may be bilked by vendors or subject to other fraudulent actions.  Accounts payable personnel but by able to prevent accidental reimbursement for expenses submitted by employees and vendors alike.  In other cases, accounts payable personnel must also be aware of fraudulent invoices or invoice-like documents designed to trick the commercial entities into reimbursing expenses that do not exist.  For this reason, even the most modern accounts payable automation systems will require human supervision and investigation to prevent double payment, exploitation or fraudulent payments.

How do business entities use accounts payable software?
Accounts payable software automates some functions of typical accounts payable work by organizing items such as invoices, packing slips and purchase orders to ensure each item is accounted for and the debt is paid.  The accounts payable software organizes these accounts, which minimizes the potential for lost documents or other human errors.  Modern accounts payable software can scan documents and recognize words and phrases that will then match the invoice to a purchase order.  This saves on time as it prevents the manual scanning of documents and the need to forward the invoice to the purchaser for verification.

Understanding Accounting Principles

Understanding Accounting Principles

What are the principles of accounting?

The principles of accounting have varied in the past few decades, with several organizations having the final say on proper accounting standards.  Current accounting standards for state and local governments are set by the Governmental Accounting Standards Board.  The GAAP accounting standards are determined by the Financial Accounting Standards Board.  These standards are not law, but regulatory agencies mandate that this form be used for the sake of convenience and ease of interpretation.  Although the United States currently abides by the Generally Accepted Accounting Principles (GAAP), the US has begun to change accepted accounting principles and standards to the International Accounting Standards Board, in order to standardize its accounting principles with the principles used by the rest of the world.  If completed on schedule, this change will happen in 2014.  Principles of accounting must be standardized to provide the best possible information for potential investors as well as allowing for the finances of two companies to be compared.


What are the principles of accounting for the federal government?
Federal Accounting Standards Advisory Board publishes handbooks to advice federal agencies and entities that receive federal money.  These handbooks are lengthy with important listings such as proper terms to use when composing financial statements and listing of proper abbreviations.  There are also a number of procedures based on specific functions of federal agencies and expenses common to federal entities.

What are the International Financial Reporting Standards?
The International Financial Reporting Standards are a set of accounting principles that provide guidelines for the proper reporting of financial data.  The standards of the IFRS are set by the Board of International Accounting Standards Committee in London, United Kingdom.  The standardization of the principles of accounting ensures the transferability of financial reporting standards between countries as the lack of such standards would mean that financial data would not be accurate and readily understood by a company or investor in a different jurisdiction or country that the reporting company is located at.

What are the general obligations of accountants under principles of accounting?
Regardless of the principles of accounting the accountant abides by, there are usually commonalities among these guidelines.  Basic accounting principles generally obligate the accountant to act in good faith and engage in full disclosure of all potential issues with the entity’s finances.  Accountants must offer the most realistic view of the company finances rounding figures down and anticipating potential losses.  Under no circumstances should an accountant that follows conventional accounting principles overreport income or underreport expenses.  Doing so will cause a financial liability for the entity that anticipated greater gains or fewer losses based on conclusions gleaned from financial statements released by the accountant.
In additions to rules on disclosure and good faith, the accountant is generally obligated under accounting principles to remain consistent on the time periods that the financial reports assess and keep the monetary amounts consistent, without accounting for inflation that would make the item or expense worth more or less at present day.

Sole Proprietor vs LLC

Sole Proprietor vs LLC

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.

Sole Proprietorship 
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.

LLC
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.

Sole Proprietorship vs LLC
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.  

General Partnership FAQS

General Partnership FAQS

General partnership

A general partnership is an unincorporated business relationship among two or more persons that share equal liability and debts accrued by the company.  It is a non-taxable entity but all partners must report their share of the income to the IRS and account for said income on their personal tax forms.

What are the disadvantages of a general partnership?
Liability for all parts of the company, including debts is shared by the partners.  Therefore, in the event of bankruptcy, all partners, even non founding partners are liable to have assets seized to pay debts.  Liability is a factor in a general partnership as all partners share liability for both their and the actions of the other partners.  Additionally, partners can also be held liable for the actions of employees.  Personal liability is unlimited in a general partnership, but damages committed while doing personal actions and not business related actions places sole liability on the partner.  Actions committed by the partner while performing a function for the partnership would hold all partners liable, regardless of their contribution or input on the event.

How is a general partnership taxed?
A general partnership 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.  Taxing a partnership that serves as a flow through entity would constitute double taxation and therefore would be a non-taxable entity.  Information about partnerships is reported but not taxed through the IRS K-1 form that accounts for each share of the partnership accrued by the partners.  A general partnership does not need to be an equal partnership and profits can differ by partner.  For this reason, each partner accounts for and pays taxes on their particular share of the profits, rather than having the general partnership entities taxed.

How are the rights in a general partnership determined?
The rights in a general partnership are determined by prior agreements made by the partners.  There are no laws defining partnership functions such as voting and decision making rights.  It is generally assumed that all have equal voting rights as partners, unless there is an agreement to the contrary that staggers voting rights on contributions to the partnership, or other related factors.  Members of a partnership are expected to work in the interest of the partnership and inform other members of the partnership when pursuing an arrangement for one’s personal gain.  Otherwise, members of a partnership are obligated to work for the benefit of the other partners, unless allowed otherwise by prior agreement.


Is a lawyer necessary for a general partnership?
A lawyer can serve a valuable function in a general partnership by helping to create comprehensive agreements that determine the contributions and rights of each partner and provisions for the addition of new partners.  There should also be provisions in case the partnership is dissolved or a partner decides to leave the partnership.  These provisions will determine the distribution of assets, shares and other property owned by the partnership.

Understanding LLC Taxes

Understanding LLC Taxes

What are LLC taxes?
Individuals may form an LLC, not just for liability purposes, but also for simplified taxation.  LLC taxes offer a number of taxation benefits over standard arrangements.  The IRS does not consider an LLC as a taxation classification, but LCC taxes will vary depending on how the entity decides to be taxed.  This means that they can be taxed as a corporation as well as a partnership or disregarded as separate entity with only one owner.  The separate entity will tax the owner rather than the LLC and the income and deductions will be filed on the individual’s tax forms.  Multiple member LLCs are taxed either as a partnership or corporation.  Single member LLC’s are either disregarded and individually reported, or taxed as a corporation.


How are LLC taxes determined by default?
Without an effort to change LLC taxes classification by the LLC owners, that LLC is treated as a partnership and a partnership tax return will be filled out.  Each stakeholder in the LLC files a K-1 form that reflects their income and deductions from the partnership.  Single owner LLCs are treated as a sole proprietorship by default and multiple owners are considered a partnership by default.

What is a K-1 Form?
A Schedule K-1 is Form 1065 that determines LLC taxes in terms of the individual owners.  The form is a short two pages and the individual discloses information about the partnership, shares of profit, loss and capital and other income generated by the partnership.  LLCs filing as corporations must first file the appropriate forms to be considered for corporation taxation, then file Form 1120, the US Corporation Income Tax Return.  The purpose of a K-1 form is to account for each partner’s shares, which is used in conjunction with a typical 1040 form to ensure the proper taxation is assessed.

How can an LLC be taxed as a corporation?
One merely has to file IRS Form 8832, widely available online, to elect to be taxed as a corporation.  The form is short, at seven pages, with only three pages that need to be filed out by the individual electing to change the designation of the LLC.  These forms are processed at locations in Cincinnati, Ohio for Eastern LLCs and Ogden, Utah for Western LLCs.  Foreign entities must indicate the country where the LLC was formed in.  There is a list of foreign business classifications that are equivalent to an American LLC on page 7 of Form 8832.
What is a flow-through entity?
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.  Taxing an LCC that serves as a flow through entity would constitute double taxation and therefore would be a non-taxable entity.  LLCs that file taxes as corporations are not “flow-through” entities and will be taxed as other corporations would, upon filing their Form 1120 tax return.  The only exceptions are LLCs that are classified as “S corporations” under US tax law.
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