Starting Your Own Small Business

You're smart, hard-working, and driven to succeed. Your friends describe you as innovative, entrepreneurial, and business-savvy. You have thought out an angle for a business that is going to revolutionize the industry. Now it's decision time. Are you willing to take a financial risk on the strength of your idea? Or do you prefer the low-risk stability of your present employment? Is your venture well conceived and built to thrive, or fatally flawed and destined to fail? These are vital soul searching questions you must answer before joining the ranks of entrepreneur.

Starting your own business can be an exciting venture that allows you to use your personal knowledge and talent to prosper financially and emotionally. Ideally, your business venture involves an area in which you possess a high degree of expertise and passion. You need to be realistically aware of your talents and liabilities, and must have the energy to overcome many frustrating obstacles. The concept of the "American Dream" - being your own boss, following your heart, and charting your own destiny can be filled with rewards and accomplishment. However, your vision is not something guaranteed to succeed. Many creative endeavors come unraveled based on insufficient analysis, overly optimistic projections, or the inability to deliver a unique or tangible value. In order to avoid failure, starting your business must begin with the successful navigation of strategic and financial planning.

In order to transform your idea into a legitimate reality, preparation is of the utmost importance. Successful small businesses are not born from fleeting visions, but rather are built from a foundation of careful thought and deliberate analysis. Strategic planning is often thought of as a written document (most often referred to as a business plan), but the concept is much larger. The process should begin with identifying your organizational mission and vision, assessing the demographics and motivations of your target audience, and developing a mechanism for achieving short-term and long-term objectives.

Free Business Cards - VistaPrint.ca Strategic planning includes several critical elements: a detailed examination of your proposed product or service; the organizational structure that will accomplish the delivery of your business; market trends as they apply to your business, competition, and the industry at large; and a communications plan for marketing your business to prospective consumers and merchants who will provide necessary capital and collaboration. The strategic plan should be written to address in detail each of the elements above, however, it should not include highly sensitive, overly technical, or proprietary information. Additionally, it should realistically project financial matters such as income, cash flow, and operational and capital expenditures. While you may hold expert knowledge of your chosen industry, it is often difficult to master all aspects of business development that include legal matters, marketing, and accounting. Because strategic planning will offer an operating structure for your business, it is best to consult with expert advisors or assemble a qualified team if you are not highly credentialed in each area.

Strategic planning will not only provide you with a framework for developing your business idea, but also a vehicle for the second prerequisite to starting your business: financing. In essence, a solid strategic plan is interdependent with the likelihood of raising capital for your business. Whether applying for loans or securing investors, the ability to articulate your mission, method of delivery, and financial projections will determine your success in the notoriously difficult arena of fundraising.

Your strategic plan will determine the legal form your business should take. Typically, small businesses exist as sole proprietorships, Limited Liability Companies, C corporations, S corporations, general partnerships, and limited partnerships. Each entity possesses general advantages and disadvantages, but the specific legal form is contingent upon your individual and business objectives. Of course, your strategic plan will also determine how much capital is required to begin your business and achieve the desired outcomes. Many individuals who initiate small businesses receive their start up capital in form of SBA loans. Qualifying for these loans is a function of personal credit and income tax history, demonstration of the ability to repay the loan, collateral and business debt ratio, strength of the business plan, and the investment required to start a business (typically ranging from 10-30% capital injection). Again, preparation is the key to success.

With dedication and appropriate attention to detail, you can establish the building blocks for a thriving enterprise. No matter what your business, be sure to discuss it with family and professionals to determine if it is the right opportunity for you.

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How Common Is Identity Theft?

How Common Is Identity Theft?

ID theft affects millions of households and costs billions of dollars, government says.

Robert McMillan, IDG News Service
Monday, April 03, 2006

Wondering how likely you are to have your credit card number stolen? Well, according to a comprehensive survey conducted by the U.S. Department of Justice (DOJ), identity theft is affecting millions of households in the U.S each year and costing an estimated $6.4 billion per year.

About 3 percent of all households in the U.S., totaling an estimated 3.6 million families, were hit by some sort of ID theft during the first six months of 2004, according to DOJ data released this week.

The data comes from the Justice Department's National Crime Victimization Survey, which interviews members of 42,000 households across the country every six months to better understand the nature, frequency, and consequences of crime. Households that participate in the survey are selected at random and then interviewed by DOJ statisticians twice a year for three years.

The DOJ has been compiling this information for more than 30 years, but this marks the first time it has asked households about identity theft, said survey author Katrina Baum, a statistician with the Justice Department's Bureau of Justice Statistics.
Common Consequences

According to the DOJ's numbers, credit card misuse is the most common consequence of identity theft. It accounted for about half of the cases of identity theft that the survey tracked, Baum said.

Of the other identity theft victims, about 25 percent had banking and other types of accounts used without permission, 15 percent had their personal information misused, and about 12 percent faced a combination of several types of ID theft.

The average loss from these crimes amounted to $1290, with two-thirds of respondents saying that the theft cost them money. Based on these numbers, the nationwide estimated loss during the six months of the study amounted to $3.2 billion, for an annualized total of $6.4 billion.

The young and the well-to-do appear to be more at risk for identity theft, according to the DOJ numbers. Households headed by people between 18 and 24 years of age and those with incomes of $75,000 or more were the most likely to experience identity theft. Households in urban and suburban areas were also more likely to be affected.

According to Baum, 5 percent of households earning more than $75,000 per year experienced this kind of crime. "It's usually a phenomenon that's experienced by the young and those in urban households," she said. The survey did not explore why this is the case.

The "Identity Theft 2004" report is available online.

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