Author Archives:Score Cincinnati

NANIMASSAGECOY

Mason’s NANI Massage Named SCORE Client of the Year

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Contact: Melinda Zemper                                                                              Sept. 26, 2016

Email: mzemper@fuse.net

Phone: (513) 706-3737

Mason’s NANI Massage Named SCORE Client of the Year

NANI Massage of Mason was selected a Client of the Year Sept. 16 at the annual SCORE luncheon and awards ceremony.

The year-and-a-half old company is owned by Nancy Blanchard of Loveland; Matt Roth and Ashley McCarty. Their SCORE mentors are Gilbert Minson of Symmes Township; Dick Wendel of Cincinnati; and Jane Vanderhorst of Cincinnati.

SCORE is the volunteer arm of the Small Business Administration. Its 100-plus mentors provide no-cost mentoring and low-cost small business workshops for entrepreneurs who are high on passion, but need the practical business guidance and support that only seasoned business owners and managers can provide.

“When I began to help NANI, they were small, but going like gangbusters,” said Minson. “I’ve seen a beautiful transformation in their business that takes massage from a luxury to a necessity.”

Blanchard said she and her partners worked on their business plan for two years and knew they had something special, but needed to hear it from a business professional. They planned to combine the holistic powers of therapeutic massage with various healing ingredients to deliver a transformational client experience that would rejuvenate the body, quiet the mind and refresh the soul, according to their website.

“If it wasn’t for SCORE, we wouldn’t be where we are right now,” said Blanchard. “From that first meeting, Gilbert gave us confidence and suggestions that caused ideas to explode out of us in meetings.”

NANI has purchased a dedicated phone system and grew from 13 to 20 massage therapists since SCORE began mentoring it. The owners plan to add another location in West Chester or Liberty Township sometime next year.

SCORE also named two other Clients of the Year: The Delish Dish catering and Made by Mavis jellies and jams of Covington; and Helping Hands of NKY of Florence, Ky.

Annual service awards were also announced at the luncheon. SCORE mentors who have volunteered for 10 years include:

Claudia Aviles of West Chester; Bill Haman of Indian Hill; Tom Moon of Cincinnati; and Dick Wendel of Cincinnati;

SCORE mentors who have volunteered for five years include: Brian Hanley of Cincinnati; Dan Herche of Cincinnati; Mary Hurlburt of Cincinnati; Bill Schlueter of Cincinnati; Greg Spontak of Loveland; Carlin Stamm of Cincinnati; and Jane Vanderhorst of Cincinnati.

For more information about NANI Massage, visit www.nanimassage.com.

For information about SCORE workshops or mentoring, call (513) 684-2812 or visit www.scoreworks.org.

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Legal Considerations Brief Roundup

Legal Consideration Brief roundup

Legal considerations are not to be ignored by small business owners. The easiest way to avoid any problems is to be prepared. Preparation should begin with choosing your attorney before you need one.

Your Business Attorney

What legal services can an attorney provide your business?

  • Select and implement your legal form of business organization
  • LLC: understand the benefits and limitations of this form of legal protection
  • Multiple member LLC or partnership: draft operating and buy-sell agreements between partners
  • Sub-S or schedule-C corporation: draft corporation buy-laws, buy-sell agreement between shareholders
  • Assist in obtaining necessary registrations, licenses, permits, trademarks, patents
  • Coordinate the resolution of your business legal and tax issues with your personal estate plan and finances. Maintaining legal separation between business assets and personal assets is a difficult challenge for a small business and requires legal advice.
  • Review all legal agreements: insurance policies, loans, leases, mortgages, contracts
  • Review the legal ramifications of any new activity: franchise, acquisition, joint venture

Continue to read Brief #08.00 to discover how to select your attorney.

Patents for Small Businesses

NOTE: This Brief is a general overview of patents. Please check the U.S. Patent Office website, uspto.gov, for the most up to date information.

General

The granting of patents is based on Article 1, Sec 8 of the Constitution. Its purpose is to promote science and the useful arts.

Inventors in return for making public their invention with a patent are granted a property right which excludes others from making, using, selling, or importing the invention. This right lasts for 20 years from the date of filing for the patent.

Continue reading Brief #08.01

 

Trademarks and Service Marks

NOTE: This is a general overview of trademarks and service marks. Please check these websites for the most up to date information: US Patent & Trademark Office: www.uspto.gov/, and the Ohio Secretary of State: www.state.oh.us/sos/

What is a Trademark?

A Trademark is any word, phrase, symbol or design or combination thereof that identifies and distinguishes the source of goods from one party from those of another.

Examples are the statement “Like a Good Neighbor State Farm is There,” and brand names such as Ford “Fusion,” and “Tide.” A trademark may be owned by an individual, corporation or association.

Continue Reading Brief #08.08 to learn more about Service Marks

What Is A Copyright?

Copyrights

Copyright is a form of protection provided by the laws of the United States to authors of original works of authorship. Works that can be protected by copyright are: literary works; musical works including words; dramatic works including accompanying music; pantomimes and choreographic works; pictorial, graphic and sculpture works; motion pictures and other audiovisual works, sound recordings; architectural works and computer software.

Some things are not eligible for copyright protection. They include: works that have not been fixed in tangible form, titles, names, short phrases, slogans, familiar symbols or designs, ornamentation, coloring or lettering, lists of ingredients, ideas, procedures, methods, systems, processes, concepts, principles, discoveries, devices, any information that is common property such as a calendar or tables taken from public documents.

Continue Reading Brief #08.09 to learn more about why Copyrights are important.

 

Purchasing for Manufacturing Businesses Introduction:

This is a list of the basic procedures needed to ensure that purchasing (acquisition) needs are met for companies that manufacture a product. Included is a “sample” Purchasing Agreement to supply a material used in the manufacturing process.

Ethics / Integrity:

Purchasing for the business must be carried out with integrity and high ethical standards. Simply put, this means all dealings with suppliers and vendors must be honest, fair, consistent, and above board. Purchasing must not compromise its objectivity or show favoritism (or the appearance of) by receiving gifts or perks from suppliers.

Important Legal Considerations in Purchasing a Manufacturing Business Continue Reading Brief #08.10

Purchasing for Non-Manufacturing Businesses

Introduction:
This lists the basic procedures needed to ensure that purchasing (acquisition) needs are met for a non-manufacturing business. Ethics / Integrity:

Purchasing for the business must be carried out with integrity and high ethical standards. Simply put, this means all dealings with suppliers and vendors must be honest, fair, consistent, and above board. Purchasing must not compromise its objectivity or show favoritism (or the appearance of) by receiving gifts or perks from suppliers.

Authority:

The Purchasing Agent should be authorized (written documentation) by a company official (for example, the President/Owner) to make purchases for the company. For control purposes, no one else should place orders, except in an emergency and / or safety related situations.

Continue Reading Brief #08.11 for additional information.

If you need direction or support for your small business request a free SCORE Mentor here. Not sure if a SCORE Mentor will be of value to your business, watch this quick video from a SCORE client.

 

 

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2016 Clients of the Year

SCORE Selects Three Entrepreneurs 2016 Clients of the Year

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Contact: Melinda Zemper                                                                                                              Sept. 26, 2016

Email: mzemper@fuse.net

Phone: (513) 706-3737

 

SCORE Selects Three Entrepreneurs 2016 Clients of the Year

Three regional businesses—a catering company, an at-home care firm and a massage service took top entrepreneur honors Sept. 16 at SCORE’s annual Client of the Year awards luncheon.

SCORE is the volunteer arm of the Small Business Administration. Its 100-plus mentors provide no-cost mentoring and low-cost small business workshops for entrepreneurs who are high on passion, but need the practical business guidance and support that only seasoned business owners and managers can provide.

The Delish Dish catering firm and Made by Mavis jellies and jams of Covington; NANI Massage of Mason; and Helping Hands of NKY in Florence, Ky., were selected top regional entrepreneurs.

The Delish Dish and Made by Mavis of Covington are owned by Mavis Linneman-Clark. The catering company was formed in 2012 to bring globally-inspired dishes and artisan jams to greater Cincinnati and northern Kentucky. Carlin Stamm of Mt. Lookout is Linneman-Clark’s SCORE mentor.

“I consider Mavis the ideal SCORE client,” said Stamm. “She’s smart, prepared for business meetings and passionate, as well as continually cheerful. She has gone in three years from zero income to about $500,000 projected for this year.”

Linneman-Clark had been working with Stamm on her business when she was selected a Bad Girls Venture finalist in the spring of 2013. She joined the Northern Kentucky Incubator Kitchen to expand her catering business and launched an artisan jam line called Made by Mavis.

Rebecca Volpe, director of the Small Business Development Center at Northern Kentucky University, helped Linneman-Clark develop cost information and financial projections in her search for a suitable building to purchase, said Stamm.

In 2015, Linneman-Clark was one of the faces of the Kroger Buys Local campaign through the Kentucky Proud program.

NANI Massage of Mason is owned by Nancy Blanchard of Loveland, Matt Roth and Ashley McCarty. Their SCORE mentors are Gilbert Minson of Symmes Township; Dick Wendel of Cincinnati; and Jane Vanderhorst of Cincinnati.

“When I began to help NANI, they were small, but going like gangbusters,” said Minson. “I’ve seen a beautiful transformation in their business that takes massage from a luxury to a necessity.”

Blanchard said she and her partners worked on their business plan for two years and knew they had something special, but needed to hear it from a business professional. They planned to combine the holistic powers of therapeutic massage with various healing ingredients to deliver a transformational client experience that would rejuvenate the body, quiet the mind and refresh the soul, according to their website.

“If it wasn’t for SCORE, we wouldn’t be where we are right now,” said Blanchard. “From that first meeting, Gilbert gave us confidence and suggestions in meetings that caused ideas to explode out of us.”

NANI has purchased a dedicated phone system and grew from 13 to 20 massage therapists since it began working with SCORE. The owners plan to add another location in West Chester or Liberty Township sometime next year.

Helping Hands of NKY in Florence, Ky., is owned by David Sarker of Walton, Ky. Steve Bradley of Fort Mitchell and Mary Willenborg of Edgewood are his SCORE mentors.

After a career as a commercial airline pilot, Sarker decided he wanted to spend more time with his two children. He wanted to start a business that would allow him to stay close to home.

He formed Helping Hands of NKY in 2010 to provide in-home care for clients who range from ages five to 100-plus years old. The company offers a safe, reliable and caring option for people who need assistance, but prefer to stay in their own homes. It offers grooming and hygiene care; meal planning and preparation; light housekeeping and companionship.

“I met Mary at a chamber of commerce meeting and we clicked right away,” said Sarker. “She told me about SCORE and I jumped at the chance to have help with the business. Originally it was tough, because she and Steve made me do things I didn’t want to do—like look at numbers and setting price points. I also had to make some hard choices about letting go an employee who was costly, but not producing.”

“We had a bit of tweaking to do,” said Willenborg. “We helped David with goal setting and gave him confidence that if he raised his rates, people would not care because he had such high-quality customer service.”

Sarker said revenues are on track to reach $500,000 this year. Since his experience with SCORE has been positive and he likes the idea of helping other entrepreneurs, he intends to become a SCORE mentor, he said.

Annual service awards were also announced at the luncheon. SCORE mentors who have volunteered for 10 years include:

Claudia Aviles of West Chester; Bill Haman of Indian Hill; Tom Moon of Cincinnati; and Dick Wendel of Cincinnati;

SCORE mentors who have volunteered for five years include: Brian Hanley of Cincinnati; Dan Herche of Cincinnati; Mary Hurlburt of Cincinnati; Bill Schlueter of Cincinnati; Greg Spontak of Loveland; Carlin Stamm of Cincinnati; and Jane Vanderhorst of Cincinnati.

For information about SCORE workshops or mentoring, call (513) 684-2812 or visit www.scoreworks.org.

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FINANCIAL EVALUATION OF FRANCHISE INVESTMENTS

franchise investment

Investing in a franchise is basically the same as buying any business. The financial aspects are covered in the SCORE Brief Buying a Business. In addition, however, an important aspect of buying a franchise is evaluating the investment consequences from the franchisee’s viewpoint; the discussion below outlines a method for such an evaluation.

1. Determine the cost of the franchise privilege:
What is the total franchise package price? $___________
Estimate the value of all tangible items furnished in the package:
Merchandise or inventory $___________
Equipment and related supplies $___________
Paid expenses to attend training, travel, motel, etc. $___________
Prepaid or stated share of local advertising cost to be paid by franchisor $___________
Literature, sales aids, stationary $___________
Other identifiable assets $___________
Deduct total value of asset items (-) $___________
Net Cost (price minus assets) (=) $___________

Whether net cost is stated in the contract or must be computed as above, it represents what you are paying for the operating expertise, public awareness of the name, training and general guidance.

2. Calculating the total investment risk vs. time to recover
 

Total franchise package price

 

 

$___________

 

Plus estimated additional expenses not covered in the package: attending training, preparation of the store or operation site, acquisition and preparation of a van or vehicle (+) $___________
Total Venture Development Cost (=) $_________ (A)
Make a realistic estimate of the average monthly operating profit for this venture without charging a salary for your time. $_________ (B)
Compute the interest earning power of sum (A) (Total Venture Development Cost) as if it were to be invested in the money market at a current percent annualized return. Divide this amount by 12 to get the monthly return (C) $___________ divided by 12

$_______ (C)

Subtract (C) from (B) to reflect the loss of earning power of your Total Development Cost. This equals your Adjusted Operating Profit (-) $________ (D)
Divide (A) by (D) to determine the number of months to recover your investment (=) $_________ (E)

If your estimated monthly operating profit (B) is reasonably accurate, answer (E) is the number of months you must operate successfully to recover (A) the Total Venture Development Cost plus its potential interest earning power.

  1. Risk versus Time

Does this investment reflect the best return for your money and time? At least you now have a measure of the value of your investment money. The final answer will have to be weighed against what other gainful employment might be available and how determined you are to “own your own business.”

There are no refunds on these investments. Seek help before signing. Review your findings and plans with professional advisors, and a legal opinion on contracts is always advisable.

Note: For general information on selecting and operating a franchise, refer to the SCORE Brief entitled “Franchising.”

Need a second set of eyes to look at the financial evaluation? Request your FREE SCORE Mentor by clicking here.

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Purchasing for Manufacturing Businesses

Introduction:

This is a list of the basic procedures needed to ensure that purchasing (acquisition) needs are met for companies that purchasing for manufacturingmanufacture a product. Included is a “sample” Purchasing Agreement to supply a material used in the manufacturing process.

Ethics / Integrity:

Purchasing for the business must be carried out with integrity and high ethical standards. Simply put, this means all dealings with suppliers and vendors must be honest, fair, consistent, and above board. Purchasing must not compromise its objectivity or show favoritism (or the appearance of) by receiving gifts or perks from suppliers.

Authority:

The Purchasing Agent / Contact should be authorized (written documentation) by company official (Vice President, President / Owner) to make purchases for the company. To maintain good internal control procedures, no one else should place orders, except in an emergency and / or safety related situations.

Purchasing Methods:

Purchasing for a small business (including a business that manufactures a product) can be done in a number of ways depending on what is purchased. Consider the following ways:

1) Petty Cash ($200 or less) –Authorized person receives requests from end-users for some small purchase. (Purchasing Agent / Contact establishes some basic “numbering system” and enters request in a log book). Authorized person typically goes out and buys the item, pays cash and passes on item to end-user. Person authorized to handle petty cash must reconcile records (cash receipts in and out) periodically and report results to Office Manager, President or Owner for checks and balance accountability (i.e., good internal controls).

2) Credit Card (Less than $500) — End-user makes request for material or service to Purchasing Agent / Contact via e-mail, fax, or supply form. Idea here is to document what end-user needs. This gives the Purchasing Agent a bona fide business need to place an order. Again, a “numbering system” should be established to track purchases. Purchasing Agent faxes/e-mails the order to an approved supplier / vendor who accepts the company’s credit card. Orders may also be phoned in , however, suppliers should confirm receipt of order via return fax/e-mail. Material is delivered or service rendered with receipt / invoice attached or forwarded later. If invoice received at a later date, confirm that material has been received or service rendered in a satisfactory manner before paying the invoice. Minimally, annual reviews / audits of credit card purchasing system are recommended to ensure checks and balance accountability.

Please note: Any of the large national credit card companies (Visa, MasterCard, American Express, etc.) will gladly work with the Purchasing Agent / Contact to set up a company purchasing system. These programs typically offer daily, weekly, or monthly financial reports which help in tracking spending. Check the web site for 1-800 number for above national credit card companies to start the process of designing and implementing a customized credit card purchasing system.

3) Requisition and Purchase Order (Any dollar amount) –End-user enters
a request for material or service on a paper requisition or into a computer system. After the requisition is approved, it’s forwarded to purchasing. The Purchasing Agent orders the material or service using a purchase order (paper or computer generated), which is forwarded to an approved supplier or vendor to provide the material or service. Material is delivered or service rendered with receipt / invoice attached or forwarded later. If invoice received at a later date, confirm that material has been received or service rendered in a satisfactory manner before paying the invoice.

Please note: Whenever possible the purchasing functions (requisitioning, approving, ordering, receiving, and invoice paying) should have “separation of duties” to ensure checks and balance accountability. Ideally, this means a different person performs each function thus “separating the duties.” In a small business, this may be impractical. However, to maintain basic internal controls, two people should be involved in purchasing functions at a minimum with periodic reviews / audits of the system.

4) Raw Material or Parts Acquisition via Purchasing Agreement –If a purchasing agreement has been negotiated between the company and the supplier for a specific raw material or part used in the manufacturing of the company’s product, then the purchasing agreement is executed based on the terms and conditions contained therein. Typically, when a raw material or part is needed or reaches a re-order point, the Purchasing Agent or designated person in the operating department contacts the supplier’s designated representative via release order, fax, or phone and communicates to supplier that a shipment (tank-car, truck, pallet, dozen, etc.) is needed. Supplier will ship material requested based on specifications negotiated in the purchasing agreement regarding price, quality, quantity, delivery, terms and conditions. Material is received and checked for quality prior to putting in inventory or used on the production line. Supplier sends invoice based on the price in purchasing agreement for the quantity received. Receipts (quality and quantity) should be verified and approved before paying the supplier’s invoice.

The process should be reviewed / audited at least annually as part of internal controls and /or before renewing purchasing agreement.

Purchasing Suppliers:

The business’ need and the purchasing system sophistication will influence the type and number of suppliers identified and / or qualified. Minimally, the Purchasing Agent should assess the business’ operational and manufacturing needs (for example- office supplies, computer software / hardware, building, maintenance, repair, raw materials and parts, etc.) and identify and / or qualify suppliers and vendors to meet those needs. Supply qualification criteria typically include price, quality, quantity, delivery, terms and conditions, which are all negotiable. Those suppliers with capacity to best meet the business’ qualification criteria should make up purchases’ supply list of “preferred / approved suppliers. The Purchasing Agent should purchase from these suppliers “first” when there is a purchasing need for material or service for the business. Purchasing should also develop purchasing agreements for designated raw materials and manufacturing parts and execute releases (supply orders) as appropriate. Download the Brief for a purchasing agreement “sample.”

Summary:

Purchasing is an integral part of any business. A good purchasing system will insure that the Company is spending its money wisely and will protect the Company’s assets.

If you would like to request a Cincinnati SCORE Mentor, please click here.

 

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Pricing Procedures for Retail

Pricing Procedures for Retail

PRICING PROCEDURES FOR RETAIL

When your company purchases and sells a product, the revenues derived from sales of the product will directly affect the success of your business. Though pricing strategy and computations can be complex, the basic rules of pricing are straightforward.

  1. Prices must cover all costs. See SCORE Brief 4.05, Profit and Loss (P&L) Statement.
  2. The most effective way to retain or improve the profit margin is to reduce fixed and variable costs, and adjust price as necessary.
  3. Prices may need to be increased or decreased to assure that they reflect changes of costs, market demand, and competition.
  4. Competitive prices must be established to assure sales. Benchmark pricing against your competitors, but price to sell. Pricing of some products may be lower than cost (known as a loss leader) to create demand for products that can be priced at the desired profit margin.
  5. Product utility, longevity, maintenance, and end use must be judged continually, and target prices adjusted accordingly.
  6. Prices must be set to preserve order in the marketplace. If you raise your prices because you want a higher profit or a bigger marketing budget, but the competition doesn’t follow suit, your price will not be consistent with the market.

THE RELATIONSHIP BETWEEN PRICES AND COST

Before you can set a price for your product you have to determine the costs of running your business. Revenue from the sale of your products and services must cover all of your expenses, no matter how or why they are incurred. If the prices you set for your products and services do not cover all your costs, you will have a negative cash flow and have to infuse cash into the business until your resources are depleted and your business fails. See SCORE Brief 4.09, Cash Flow Projections.

How much does it cost to run your business? You must add fixed costs (such as property/equipment leases, loan repayments, management cost, and depreciation) to the variable costs of raw material, inventory, utilities, and labor. See Score Brief 4.07, Balance Sheet.

You must also take into account other costs such as damaged goods and handling of returns, and desired profits to arrive at an initial price for your products and services. However, the most important aspect of cost versus price is that ultimately the market determines the price you may charge. Bottom line, successful pricing must be between your cost/breakeven point and the maximum price the market will allow. See SCORE Brief 4.13, Breakeven Sales.

PRICING METHODS:

COST PLUS PRICING: The key to cost-plus pricing is to ensure that the “plus” figure not only covers all overhead, but generates the percentage of profit required. It is usually used by manufacturers.

DEMAND PRICING: Where there is little or no competition and you price what the market will bear.

COMPETITIVE PRICING: Where there is substantial competition and you must meet the competitive price, unless you can provide added value (location, delivery, features, warranty, service, etc.).

MARK-UP PRICING: (See below). Many retailers and wholesalers use mark-up pricing. It consists of adding a certain amount to the costs of the product, which becomes the selling price to the consumer. This markup amount must cover all other expenses plus the desired profit. For example, if your price tag says $5000 and the cost of your product is $3000, your markup is $2000.

Markup represents a percentage of the seller’s product cost. It is expressed as follows:

(Total sales – Cost of sales) / Cost of sales = % Markup

$5,000 – $3,000 = $2,000 = .66 = 66 percent markup.
$3,000        $3,000

Pricing a product

To price products, you need to be familiar with pricing structures, especially the difference between margin, markup and break-even. As mentioned already, every product should be priced to cover its purchase costs, labor costs, packaging costs, freight charges (variable costs), and a proportionate share of overhead (fixed operating expenses), and a reasonable profit. Such factors as unpredictable insurance expense, theft, shifts in wholesale material costs, freight expenses, and sales or discounts will all affect final pricing.

Margin

Margin, also referred to as gross margin, is the difference between your total sales and the cost of sales (variable costs); it equals the fixed costs plus profit. It can be expressed as a percentage or a dollar amount. As a percentage, the GP margin is always stated as a percentage of net sales. It represents a percentage of the seller’s price.

(Total sales-Cost of sales) / Net sales = Gross profit margin.

$5,000-$3,000 = $2,000 = .4 = 40 percent
$5,000        $5,000

Break-even (Refer to SCORE Brief 4.13)

Break even analysis is a method that indicates when revenues equal total cost. Your break-even point represents the point at which you neither make nor lose money in producing your product. It is expressed as follows:

Breakeven sales = (Fixed cost x Unit selling price) (Unit selling price- Unit variable cost)

It is highly recommended that you get advice from your SCORE Mentor or go to the library, or search the Internet (Google “Pricing”) to get as much information as possible on pricing. Pricing is not easy and can be very confusing if you are not familiar with pricing concepts and structure.

Just remember, with any business that you start, the key to pricing is to find the price that (1) Customers are willing to pay, (2) is competitive in the marketplace, and (3) will produce the desired profit for your business.

Do not forget a very important rule: “Cash is King”.

If you would like to request a SCORE counselor, please click here.

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Incorporation In Ohio

Incorporation In Ohio

INCORPORATION IN OHIO

The corporation laws of Ohio are prescribed by statute in Title 17 of the Ohio Revised Code. In accordance with the statute, persons desiring to organize and operate as a corporation in Ohio must file certain documents granting the authority to operate as a corporation. This filing is done with the

Ohio Secretary of State

180 E. Broad Street, Suite 103 Columbus, Ohio 43215

A good starting point is: Ohio 1st Stop: http://business.ohio.gov/starting/

The 1st Stop Business Connection is one of the easiest way to learn about starting a business in Ohio. It provides free state-level information needed to get started or continue on your entrepreneurial journey. Follow their four step process and you’ll be on your way.

The Secretary of State’s Corporations section also provides the necessary forms for all corporation filings (Form 532 for Domestic Profit or Nonprofit corporations, downloadable, including instructions from:

http://www.sos.state.oh.us/SOS/Upload/business/forms/532.pdf .

In most instances a filing fee is required and must accompany the filing. For 2013, the filing fee for initial Articles of Incorporation is $125.00. All records maintained in this office are public and may be inspected upon request.

The office is open from 8 a. m. to 5 p. m., Monday through Friday. Documents may be filed in person by bringing them directly to this office, or may be submitted by mail to: Ohio Secretary of State, P.O. Box 670, Columbus, Ohio 43216. The office is not prepared to accept documents via email at this time.

For more specific inquires, visit their website at www.sos.state.oh.us. The website offers a great deal of information such as publications, filing forms, requirements, and several types of incorporating procedures. If you do not have access to a computer, call their office at 1-877-767- 6446, follow the prompts and press “0” for a customer service representative.

When contacting the Secretary of State’s office, request a copy of “Guide to Starting a Corporation in Ohio”, or download the publication from their website at

http://www.sos.state.oh.us/SOS/Businesses/BusinessInformation/starting.aspx

Need some direction from a trusted mentor? Request your free SCORE Mentor here.

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Start-up Costs of Going into Business

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Start-Up Costs of Going into Business

When starting a business, you need to plan for your initial costs and understand their taxation.

The following list includes typical amortizable start-up costs involved in starting a business.

  • Pre-Opening Salaries and Wages – including instructors/trainees
  • Prepaid Insurance Premiums – learn more at SCORE Business Brief 09.00
  • Inventory
  • Legal and Accounting Fees
  • Rent Deposits
  • Utility Deposits
  • Supplies
  • Advertising and Promotions – brochures, business cards, flyers, newspaper ads, etc.
  • Licenses – permits – inspections – learn more at SCORE Business Brief 10.03
  • Market Surveys – to identify number and location of potential customers or distributors
  • Site Surveys – to locate a place of business
  • Supplier/Labor Market Analysis – to assess cost and supply of local suppliers/workers
  • Travel & Living Expenses: to secure suppliers, distributors or customers.

Note: Start-up costs do not include product/service research and development, interest on loans, or taxes

To be amortizable, a start-up cost must be a cost that would be deductible if it were paid to operate an existing business (in the same field as the one you entered into), and it must be paid or incurred before the day your active trade or business begins

Start-up costs of up to $5,000 are deductible as “other expense” in the first year of operation, while the balance of those costs are deductible over the next 15 years. If the first year’s costs exceed $50,000, that year’s deduction is reduced.

Organization costs up to $5,000, such as the legal fees and state registration fees required to set- up an LLC, partnership, or corporation, are deductible in the same manner as start-up costs.

Capital expenditures for vehicles, leasehold improvements, equipment, and buildings must be depreciated for tax purposes over their useful life (see IRS Pub. #946). However, under Section 179, certain expenditures (up to $500,000 in 2015) may be written off in the year incurred (Pub. #946, Page 19). There are several exceptions and limitations to this general rule, so you should discuss this option with your accountant.

If you would like to request a free SCORE Mentor, please click here.

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Financial Questions & Answers for Every Small Business

Financial Questions & Answers for Every Small Business

 

Finance issues that every business must be aware of. This is our third finance roundup of briefs. We are going to begin with Credit Score.

CREDIT SCORE

As the owner of your business your personal credit score is not something that can be ignored.

Before discussing the credit score , let’s differentiate it from the credit report. The report estimates the credit worthiness of an individual, corporation, or even a country. It is not one number, as is the credit score. It is an evaluation made by credit bureaus of a borrower’s overall credit history. A credit report is also known as an evaluation of a potential borrower’s ability to repay debt, prepared by a credit bureau at the request of the lender. Credit ratings are calculated from financial history and current assets and liabilities.

Continue reading this brief to learn how a credit rating is determined and even what factors can lower your credit score. Brief #04.39

INVENTORY ACCOUNTING and CONTROL

Businesses that buy merchandise for resale or who use material to produce a product must account for that material before it is delivered to the customer. All of this physical material, including supplies that are part of the final product, is classified as:

  • Merchandise – goods acquired by wholesalers or retailers for resale including goods held for sale in display rooms or out on consignment
  • Raw Material – items that will be a component of a produced good
  • Work-In-Process – the accumulated costs of partially completed units
  • Finished Goods – completed units, available for sale to customers

The small business entrepreneur needs a basic understanding of inventory accounting and this brief will give you a basic understanding. Brief #04.51

LEASING versus BUYING EQUIPMENT

Should you lease equipment for your factory, warehouse, store or office, or should you buy it – – assuming Your capital is limited and you must borrow or lease to finance the purchase?

This brief will share the pros and cons of leasing as well as the types of lease. Brief #04.53

Leasing versus Buying Business Location

Should you lease business property for your factory, warehouse, store or office, or should you buy it? The assistance of a financial advisor is strongly recommended, as the decision is important and fairly complex .

Although costs for the space from which you want to operate your business are significant, the buy or lease decision is more than a financial decision. Three factors should be evaluated: Market, Financial, and Other Considerations. This brief will help will the evaluation. Brief #04.54

Advanced Competitive Analysis (SWOT Analysis)

SWOT Analysis is a useful technique for understanding your Strengths and Weaknesses, and for looking at the Opportunities and Threats you face. Strengths and weaknesses are often internal to your organization. Opportunities and threats often relate to external factors. For this reason the SWOT Analysis is sometimes called Internal-External Analysis and the SWOT Matrix is sometimes called an IE Matrix Analysis Tool.

What makes SWOT particularly useful is that, with a little thought, it can help you uncover opportunities that you are well placed to exploit. And by understanding the weaknesses of your business, you can manage and eliminate threats that would otherwise catch you unawares.

This brief provides the explanation and questions you should ask yourself for an effective SWAT analysis. Brief #04.59

Retail and Restaurant Site Selection

The real estate saying “Location. Location, Location” is very true when selecting a location for your business.

If you want to find a “home run” location for your retail or restaurant business the very first thing you need to do is be prepared to do lots of research and fieldwork. In other words, expect to do homework.

While site selection is part art and part science, it is important to understand that art plays only a minor role in the decision-making process. As a result, be forewarned that you can’t afford to let gut, emotion and urgency become major influences when making your site selection decision. Continue reading Brief 04.61

Seven Keys to Generate Revenue

This Brief is a must read for all business owners regardless of what stage you are in.

INTRODUCTION: Building B2B (much of this also applies to the B2C world as well) revenue is not a dark secret. There really is no magic in finding new prospects. We seem to stumble across those who appear to be prospects every day.

However, wouldn’t it be nice to systematize our marketing and sales process in the same way we follow a methodology when providing our products and services? The ideal is to establish a process that builds revenue and continually identifies prospects and their readiness to buy.

Many firms have a sales and marketing plan that was developed long ago or just came about as their business grew. Times change, the economy shifts, potential and current clients have new needs, different opportunities arise, and plans need to be updated. Continue reading Brief 04.62 to discover the seven essentials to generating revenue.

If you need assistance with any financial issues in your business request your Free Score Mentor.

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Buying or Selling a Business

Buying or Selling a Business

This brief roundup will give you the basics for buying or selling a business.

Buying a Business

It is a fair assumption that when an operating business is purchased, the intent of the buyer is to acquire a present or prospective profit generator – a known entity that will provide a reasonably predictive return on the investment.

Buying a company is much like courtship. It is a process not known for rapid conclusions. Done correctly it is a long process that requires a great deal of effort and analysis. The following is a very general guideline. Items of great importance will be different based upon the business being considered for purchase. Size, structure, industry, competitive set, product/services offered will greatly influence your areas of concentration.

FINDING A BUSINESS TO BUY

 

Selling a Business

Businesses are sold for all sorts of reasons. If you’re considering the sale of your business, ask yourself the following questions: What do you want for yourself, and for your employees, as conditions of the sale? Are there any family members that might be interested in continuing the business? Is there the possibility of an employee buyout? Do you want to work for the company after the sale? Are you ready to retire, or is there something else that you would like to do? Could you report to someone else? How much of your self-esteem is tied up with owning and running your company?

Thinking through the implications of a sale for you, your family, and your employees will go a long way toward helping you determine the type of buyer with whom you would be most comfortable, and what terms of sale you require?

Getting Ready to Sell

 

Effective Purchase or Sales Agreement

Finally, you will want to consider what is included in your purchase or sales agreement. This brief identifies 35 elements to consider.

Contents of an Effective Purchase or Sale Agreement

  1. Decide whether it will be a stock or asset sale transaction.
  2. If an asset sale, define the assets. Keep in mind that there could be intangible assets such as software licenses. Do not forget deposits with utilities or other prepaid expenses. Make a list of assets as an appendix to the purchase/sale contract.
  3. Define the liabilities. Even in an asset sale there can be liabilities such as accounts payable and vacation/holiday accruals.

 Continue reading

Need assistance with buying or selling a business, request your free Score Mentor here.

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