Resource Center

Thank you for visiting the Small Business Resource Center. We know that organizing and managing a business is not always simple. We have created the Small Business Resource Center to make those tasks easier. The Guidelines and Checklists in the Resource Center provide practical information that can help you address some of the most important issues your business faces. The articles in the Financial Library cover many topics that you may find interesting and useful on a regular basis.

We recognize that business owners and managers face many challenges in running their business and managing their personal finances. We are committed to providing the services and solutions to help you reach your financial goals and to make your business successful.

What to Consider Before Beginning

Starting a business and being your own boss can be exciting, and for many, it is the professional goal of a lifetime. Thousands of new businesses are started everyday, yet history shows that a majority of them fail because of a flawed business concept, inadequate financing, or poor management. Starting a new business can be risky, and here are some issues to consider before taking that big step.

Do you have the psychological make-up to start a business?
Starting a new business is risky, and you need to be sure you can handle the risks.

• Risk of failure - Starting a business is risky, both from a financial and mental point of view. Do not let the excitement and thoughts of success blind you to the facts that you may lose money or your business may fail despite a lot of hard work. If you cannot accept these risks, you probably will be better off continuing to work for someone else.
• Risk of rejection - Every business must generate sales, and during that sales process, it is inevitable that some (or most) potential customers will not buy your product or service. You must be able to deal with others not wanting what you are offering. If rejection will cause extreme mental anxiety or deter you from making the next sales call, working for yourself may not be right for you.
• Risk to your lifestyle - Starting a business involves long hours, constant distractions, choices of how you focus your attention, and some sacrifices. These things will affect you and those around you. Be sure to consider the impact of your actions on yourself, your family, and others.

What type of business makes sense for you?
Hundreds of thousands of ventures are started each year in all lines of business. Starting a business from scratch, buying an existing business, or entering into a franchise arrangement all present opportunities and potential pitfalls.

Be sure to do your homework. Think about the current and potential markets for whatever business you are considering. Examine the strengths and weaknesses of competitors. The Internet and trade associations can be great sources of valuable information. You may be surprised what you can find readily available.

Find a line of business that matches your skills, experience, and interests. If you are considering starting a personal service business, it can be nice to begin with at least one existing customer. Whatever type of business it is, be sure you like it because if you are successful, you may spend many years or several decades in that business. There are few things worse than not liking your job.

If you are considering purchasing an existing business, investigate it thoroughly. While it may be attractive to step into a business that already has existing operations, learn why the current owner wants to sell. Buying someone else's failing business is significantly different than buying a successful business from an owner that is retiring. Have a professional look at the financial statements and any contracts you may be signing.

Are you starting alone or should you have a partner?
This can be one of the most challenging issues you face. Running the business yourself gives you the opportunity to make all the decisions, but you must live with the results. A partner can bring skills, experience, and capital; however, you should be confident that you can work with that person for an extended period of time.

If you choose to have a partner, be sure to define the responsibilities and authorities of each party. How will decisions be made regarding capital contributions, spending, operations, hiring of personnel, and all the hundreds of other issues that will arise? The more you can structure the decision making process, the more you reduce the risk of having major operational problems as the business faces difficulties or growth.

If you choose to have a partner, you may also want to discuss how your relationship can be ended. While everyone has good intentions at the beginning, things can and often do change. Having a buy/sell agreement or a contractual agreement may avoid difficulties and hard feelings later.

Where will you get the financing you need?
Starting and growing a business takes money. Consider the funds you may need for office space, equipment, inventory, marketing and working capital. You will need funds for your normal living expenses and need to remember that not all customers pay quickly. One of the most common causes of business failures is inadequate capital. Create a spending plan that covers everything you think you may need and then build in an amount for emergencies.

Arranging needed capital should be undertaken early in the start-up process. Once the business is operational, you will probably want to focus on running it and not have to constantly be looking for funds. Be sure to speak with your financial institution about what they may be looking for before they would be willing to lend to a new business. You may also want to explore a loan through the Small Business Administration. The SBA programs offer a number of types of loans but can be time-consuming and frustrating.

The final piece of advice on needed capital is to consider setting a limit on how much you are willing to risk or lose before shutting the business down and accepting failure. While this may be difficult to consider when starting out, having a contingency plan for failure is prudent.

What are some of the other legal, financial and tax issues to consider?
After addressing all the other aspects, these will probably seem easy. You need to choose a business form (sole proprietorship, partnership, limited liability company, subchapter S corporation, corporation). Here are some charts that provide some details on various types of business structures.

While this may sound complicated, it is easy to decide upon the issues of the types of businesses discussed above. Each business form has appeals and drawbacks. Your attorney can be helpful in evaluating the options and drafting any documents you need.

Your personal financial and tax situations may also change when you become a business owner. You may lose the predictability of a monthly paycheck and the other benefits such as paying for your medical insurance and funding your retirement account.

Summary
The entrepreneurial spirit is alive and well in America. As you consider your future, remember that being in business for yourself can be risky as well as rewarding. Taking key steps early, working hard, forming a good idea, using sound business practices, and maybe having a little luck can make all the difference.

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How to Create a Business Plan

A formal business plan is important. It is needed when obtaining financing; serves as a guide for the policies, strategies, and tactics needed for running your business; can be shared with potential key employees; serves as a key document when you sell your business; and forces you to focus on the issues that are essential for the success of your business as you prepare it.

To prepare your plan, you may want to initially organize it in a three-ring binder with each of the numbered items as separate sections. Your business plan should be a "living document" that is reviewed often and modified as needed, and using a binder will enable you to easily make changes. You can always print the current plan for formal presentations.

1. Title Page
The title page should include the name and address of the business, the owners of the business, and contact information (person, phone number and email address). You should also include your logo, if you have one. You may also want to include the date it was originally prepared and note the date of any changes.

2. Executive Summary
A brief summary of the plan should be no more than one page; less than a page if possible. The summary should give the reader insights into:

• What your business does
• Who your customers are
• What your competitive advantage is
• The financial dynamics of your business
• Any capital requirements, if it is being used to help secure financing
• A short history of the business including major developments and the key employees

While this sounds like a lot to summarize in less than a page, here is one sentence that covers the first, second, and part of the sixth items above:

ABC Bicycle, Inc. was formed by John Smith, the current majority shareholder, in 1994 to manufacture high-end mountain bicycles for sale to specialty bicycle retailers in the Rocky Mountain region.

3. Table of Contents
The Table of Contents deserves a full page and a separate section because it will be the reader's guide to the plan. For each section, include a one sentence description of what is included.

4. Business Description
Describe your business in a way so the reader will understand how your business fits into its industry and into the marketplace. This description should include an overview of the industry and major competitors. Industry trends should be supported with references to authoritative sources such as government publications or industry analysis from professional research firms.

You should also include information on the legal structure of your business with details on ownership, the principal employees, and, if you have one, your Board of Directors.

The business description should include information on your products or services. Be sure to describe how your products or services compare to those of your competitors. Any unique competitive advantages should be spelled out in detail. The reader of the plan will ultimately make decisions (financing, employment, purchasing) based on their perception of the potential for the success of your business. Be sure to give them all the information they need to arrive at a fully informed conclusion.

5. Marketing Strategies
No matter how good your products or services are, your business needs to market them. This section includes a great deal of information and the results of your research and your thinking.

• The Market - Include information on your market in terms of overall size, any geographic constraints, pricing constraints, growth trends of the market, and how your estimates on what share of that market you can secure.
• Positioning - How you intend to have customers and potential customers view your products or services compared to those of competitors is critical. Generally, you must convert the features of your products or services into perceived benefits for the customer. Then, you must have a convincing argument for why your products or services are superior to those of your competitors. Often it comes down to an observable difference of the unique nature, quality, or pricing of your product or service. In other cases, it may be through a level of service offered to customers.
• Pricing - Setting your prices can be one of the most important factors in determining the ultimate success of your business. The description of your pricing strategy must include the financial aspects (making sure your prices cover your costs) and how you are using your pricing to compete. Include your intention to use short-term and long-term pricing strategies to accomplish your goals - gain share, maximize current profits, or maximize the long-term value of your business.
• Distribution - How are your products or services sold, and who does the selling to the ultimate user? Do you sell directly to consumers, sell to retailers, or use the manufacturer's representatives? Include details on any distribution agreement you may have in place.
• Promotion - How do you inform potential customers about your products or services? Include descriptions of your advertising and public relations efforts as well as information on any direct mail or sales promotions you may use.

Include copies of brochures, advertisements, and company literature you may use in this section. You may want to go into more detail with a marketing plan, which will help you think more about how you will promote your product or service.

6. Competitive Analysis
You and the reader of your business plan must understand where your business fits in your industry.  Identify your competitors' strengths and weaknesses, and talk about how your business can take advantage of their weaknesses and compete against their strengths. Detailing why competitors are successful or unsuccessful demonstrates that you understand your market and provides insights into how to copy their successes and avoid their failures.

It may make sense to include a table with your comments on each competitor's products, pricing, and service.  Here is an example with a worksheet for you to fill out.

7. Development Plans
How will you develop new products, new markets, and the organizational capabilities to grow into a larger, more profitable business? If the purpose of your business plan is to help secure financing, this section is where you can justify the need for the financing and describe how it will be used.  This section will also help you describe your plans for the growth of your business.

If your market analysis has identified the opportunity to expand your product offering, describe the new products you intend to develop, including the costs of development, and your goals for accessing the potential market. If you intend to enter new geographic or customer markets, include as much specific information as possible on your plans for developing those markets.

The other critical issue to include in this section is to describe how your organization can and will grow. Specifically, discuss how you will supplement your management, marketing, and selling capabilities. Identify job functions that need to be filled or need to be strengthened. The readers of your business plan need comfort that the business can function efficiently and grow. They also need comfort that the human resources needed for that functioning and growing are or can be in place as needed.

8. Operations
This section includes information on exactly how your business functions from physical, marketing, and human resources points of view.

Include descriptions of your locations, work flow, product development, order processing, and shipping.

To describe your marketing and selling, you may want to organize it around the definition of marketing (identifying and understanding the needs of potential customers, positioning your products or services as solutions clients' needs and facilitating the purchase decision, and fulfillment of that purchase).

In most, if not all businesses, the ability to attract, retain and motivate employees is critical. Include information on your hiring, employee evaluation, and compensation practices. Describe any employee benefit programs you have, such as formal insurance and retirement plans, and any other perks you offer employees.

9. Management Plan
How are decisions made and who makes them? An organization chart can present a formal look at the management process, but also include descriptions of how the flow of information takes place among decision makers. Do the structural and informal relationships among senior management result in key information being available and considered as decisions are made?

For many businesses, especially new ones, the lack of a management succession plan is a serious weakness. If your business has one, be sure to describe it. If you do not have a plan in place, create and implement one. It is essential that the business can continue to function and grow if a key manager leaves, dies, or is no longer able to function effectively.

10. Key Personnel
Readers of the business plan will want to make sure that the people running the business are capable. The information on key employees should include their current functions, their history with the company, and their professional backgrounds. Depending on the size and nature of your company, the number of individuals included will vary. At a minimum, include information on the CEO, operational managers, marketing and financial executives, major shareholders, and members of the Board of Directors.

You should also include information on any employment contracts you may have with these people.

11. Financial Information
This section should include historic and projected results. Audited (or unaudited) balance sheets and income statements for the past two or three years should be included. Projections of income and cash flow for the current year and at least one additional year should also be included.

Depending on the nature of your business, you may also want to include detailed information on accounts receivable, inventory, fixed assets, and investments.

12. Other Items
Your business plan should include a complete picture of your business and enable readers to fully understand the nature of your business and make informed decisions, so make sure they have everything they need.

Other items you may want to include:

• Information on important patents or proprietary processes you may have.
• Information on contracts or relationships with major customers.
• Information on contracts or relationships with key vendors.
• Details on other important contracts or leases.
• Details on any current or threatened litigation.

If you are using your business plan as part of a request for financing, you may also want to include information on your personal finances such as tax returns or personal financial statements.

Closing Comments
The process of preparing a business plan can be exhaustive. Gathering the information, organizing it into a logical and understandable form, and creating a document will take time and effort. If your business plan is helpful in obtaining needed financing, attracting a key employee, or promoting your business, it will have been worth the effort.

By making your business plan a living document that is constantly updated and used as a guide for making operational decisions, it will be an invaluable and integral tool for running your business more effectively and more profitably.

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How to Create a Marketing Plan

The need for a marketing plan grows as a business develops new products, enters new markets, and refines how it attempts to position and sell its products. The structure of a marketing plan is similar to a business plan but focuses more on specific products and the operations surrounding those products instead of the entire business as an entity.

A marketing plan can serve as the tool to evaluate the potential for products, a guideline for the rational development of new products, and a way to decide on marketing strategies and tactics for specific products. Components of the marketing plan may be incorporated into the business plan, and together they can serve as valuable tools in the short-term and long-term managing of the company.

To prepare your marketing plan, you may want to initially organize it in a three-ring binder with each of the numbered items as separate sections. Your marketing plan should be a "living document" that is reviewed often and modified as needed. Using a binder will enable you to easily make changes. You can always print the current plan for formal presentations.

1. Executive Summary
This section should summarize the entire marketing plan. Any reader of the plan will read this section first, and it should enable the reader to put each of the following sections into an overall perspective. It should include:

• Concise description of your product
• Explanation of how your product is different (better) than those of your competitors
• Your product's competitive advantage
• Your objectives for the product
• Financial implications, including capital needed and expected sales and profits from the product

This section will probably be the most memorable part of the entire document, so it must be accurate, well constructed, and persuasive. While it should be at the beginning of your plan, it may be best to write the executive summary last.

2. Product Description
In this section you want to start building the case for your product. It should include enough specific information on the product so the reader has enough information to understand why your product is a valid opportunity for your business. A paragraph on product details and another paragraph summarizing the opportunity will probably be enough. This section simply lays the groundwork for the detailed descriptions of the market opportunity, the competitive challenges, the way the product will fit into the rest of your operations, the goals you intend to accomplish with the product, and the way you intend to reach your financial objectives.

3. Market Analysis
This section is probably the most important part of the plan. The information you provide should illustrate the size of the overall product category and potential for your product, justify why your product should be considered as an opportunity within that category, describe the scope and characteristics of the potential market, and identify the key factors buyers consider when making a purchase decision.

When describing the overall market, try to use market statistics from reputable and recognizable sources. Industry studies from trade associations are often available and they may include historical and projected market trends that will add credibility to your plan.
After describing the overall market, you then need to justify why you will be able to gain a position within the market and estimate how large of a share is possible.

The description of your target market should include any geographic or other barriers you may face and how you will address those challenges. Describe the potential buyers of your product as completely as you can. This includes the ages, cultural specifics, income categories, sex and martial status of the buyer, education level, household characteristics, occupational characteristics, and any other information that demonstrates that you fully understand who the buyer of your products or user of your services may be.

You then need to describe the decision making process of your potential customers. Is your product a necessity or a luxury? How often is the product purchased? Are potential customers most influenced by the price or the quality of the product or the service they receive when buying?

You must also address the potential for outside factors to have an impact on sales of your product. Are sales influenced by general economic conditions? Can your product become obsolete easily? Are there legal or regulatory issues to be considered?

4. Competitive Analysis
This section should deal with the competitors you will face in the market. Along with identifying competitors, you should identify their strengths, weaknesses, and how they operate in the market. Also, be sure to rank them in the order of how you perceive their strength in the market and  to identify any potential competitors that your foresee entering the market. You should use this section to demonstrate your competitive advantage or why your efforts will be successful in light of the competition.

The process of determining the strengths and weaknesses of your competitors will be extremely helpful in determining your overall marketing strategy (how you position your product in the market) and the specific tactics you will use to implement your strategy. You will identify ways to combat the strengths of your competitors and take advantage of their weaknesses. In addition, by understanding how they attempt to sell into the market, you can learn what works and what does not work.

Establishing a foothold in a new market or gaining share means that you must take business away from your competitors. If competitors have used a specific marketing tactic successfully, consider copying it. If several competitors have tried a tactic and it has not worked, learn why it was unsuccessful. If there was a flaw in it, you may be able to implement the same tactic without the flaw and find success. However, if their tactic was well executed and still unsuccessful, be very wary of trying it again. Why would you be successful if they were not?

5. Product Development
This section should provide details on how your product will be developed or enhanced to better compete. Include a description of the current status of your product and your plans for its ongoing development. Timelines, costs, personnel needed, and details on how the product will come together will enable the reader to put this product into the broader context of your company's operation.

If this product represents your entry into a new market or an entirely new type of product for your company, identify the risks associated with its development. If you anticipate that timeline will be long or that the product may not ultimately be able to be produced, be sure to identify how and when a decision to abandon the product would be made. If the costs and efforts of developing the product risk the ongoing viability of your company, you should be ready to make the necessary decisions.

6. Operations
This section will describe how this product will fit into the overall operations of your company. Be sure to address the following issues:

• Is it an extension of an existing product line or something entirely new?
• Will you need additional personnel with specific skills? Are they available?
• Will you need additional space or a different location?
• Do you have the management staff in place to handle the development, marketing, and ongoing support of the product?
• How much will it cost? Do you have the financial resources to handle the new product?

7. Goals and Objectives
Detailing your aims for this product is important for several reasons:

• The financial goals for all of your individual products will identify your plans for the financial growth of the company as a whole.
• The financial goals for the specific product should demonstrate the economic viability of the product individually and, hopefully, how this product can provide a positive synergistic benefit to the company. For instance, if the new product opens an entirely new market, perhaps that new market could be an outlet for other products as well.
• The developing of the new product may strengthen the company by adding capable personnel whose skills can be utilized throughout the company or by utilizing available capacity.
• There can be non-financial benefits associated with developing a new product, and you should be sure to spell them out in this section.

The quantifiable goals and objectives to include in this section should contain the anticipated costs to develop the product, the expected sales of the product, and, if possible, the estimated share of market you expect to achieve with the product. These financial goals and estimates should be built into a timeline so that you can track your progress as the product is developed and sold.

8. Marketing Tactics
With the work you have done up to this point, you probably will have already identified many of the specific tactics you intend to use to introduce the product and promote it on an ongoing basis.

Mapping out and deciding on your marketing tactics requires you to consider several issues:

• Introductory versus ongoing efforts - Introducing a new product can take different types of activities than are needed once the product has established a foothold and is well known by potential buyers.
• Positioning of your product - How are you going to differentiate your product from those of the competitors? What is your competitive advantage, and how are you going to make potential customers aware of it?
• Pricing - Determining a price can be difficult, especially if the product is substantially different from those of your competitors. Your pricing decisions will also be influenced by your long term goals for the product and your company. Initial pricing, price adjustments, volume discounts, and profitability must all be considered.
• Distribution channels - Who exactly is going to sell your product and how are they going to be compensated?
  • Distributors - Have you identified the major distributors and determined if they are willing to represent your product? How will you educate or train these distributors or representative?
  • Internal sales force - Do existing sales representatives have the time, expertise, and contacts to be successful? How will the new product be integrated into their compensation system? This becomes very important if you plan to provide an additional incentive for this product and if you are trying to ensure that other product sales are not neglected.
  • Retail distribution - If you already have existing sales locations, have you planned on space and promotional displays to introduce the product?
  • Direct distribution - How will you make potential buyers aware of the product?  Have you considered the need for Internet efforts, advertising, and direct mail?
• Corporate-driven activities to market the product - Using advertising and public relations efforts can be effective for new product introductions. If you plan on these, have you identified the agencies that will do the work, or are you going to handle them internally?

9. Financial Information
This section will be reviewed very closely, especially if you plan to use the marketing plan to secure financing. At a minimum, you should have three year projections for the product, including volume projections (dollars and quantities), net income projections for the product, and cash flow projections. You may even want to break down your projections on a quarterly or month-by-month basis.

10. Summary of Marketing Plan
Conclude your marketing plan by highlighting the product's potential, the competitive advantage your product has compared to the competitors', and the positive impact it will have on your company. The summary does not have to be long.  Two or three paragraphs may be enough.

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Preparing to Borrow Guideline

Whether it is for the start-up or growth phase, most businesses ultimately need to borrow money. Here are some issues to consider as you approach the borrowing process. Addressing them as you start the borrowing process can increase the chances of getting the loan and make the process much easier.

1. Reasons for Borrowing
Every potential lender will want to know the purpose of the loan. As with personal borrowing, potential lenders will look more favorably if the funds are going to be used to produce lasting value for the business. A loan to expand the business to meet the needs of a signed contract with a major customer will be more attractive to a lender than one where the proceeds would be used to meet ongoing operating payroll needs due to a slow down in the business.

Build a case for how the funds will enhance the short-term and long-term results of the business.

2. Borrowing From the Right Source
Be sure you have considered all of your alternative sources of capital before you go to a financial institution. While running up your credit card balances can be expensive and asking relatives for funds can be difficult, those alternatives may be preferable, especially if the loan is for a small amount or for a short period of time.

Are you approaching lenders that are accustomed to making loans to businesses of your size, in your industry, or in a specific geographic area? If the institution already knows you, your business, your industry, and potentially your customers, they may already have a great deal of the information they need to make an informed lending decision.

If you expect to use the funds to purchase a piece of equipment, you may want to discuss equipment leasing options with the equipment seller. Many manufacturers of machines (from office equipment to large industrial equipment) have leasing arrangements with lenders that may be familiar with your type of business.

You also need to consider whether your primary financial institution is the right lender to approach.

3. Type of Loan Sought
Does the repayment term of the loan match with your expected cash flow? For example, will receipts from your receivables enable you to meet the payment terms?

Be prepared to offer collateral that is tied to the purpose of the loan. Getting a loan to purchase a large new machine may require you to offer a security lien on the machine as collateral. Try to avoid pledging large amounts of collateral for relatively small loans.

Depending on the size of your business, you may want to investigate a Small Business Administration loan. The SBA encourages lending to small businesses by guaranteeing parts of loans made to businesses of certain sizes where the proceeds are being used for certain purposes. You can talk to an institution offering SBA loans to learn more. While the paperwork and time frames may be viewed as a burden, this may be an option to consider.

4. Documentation Needed
You will be required to complete a loan application, which will require corporate and perhaps personal financial information. In addition, you will probably need to provide:

• Tax returns for the business for the past couple of years
• Potentially, personal tax returns for the past couple of years
• Financial statements
  • For the business for the past couple of years
  • A year-to-date statement
  • Both income statements and balance sheets
  • Detailed information on accounts receivable, accounts payable, investments and fixed assets
• A historic cash flow statement along with projections for the current year
• The lender may also want copies of significant contracts with customers and vendors
• Other important information such as patents or key proprietary information

5. Business Plan
Your business plan should play a major role in your decision to borrow and may play a major role in a lender's evaluation of your loan request. The major components of the plan should include:

• Business description
• Marketing strategies
• Competitive analysis
• Development plans
• Operations
• Management plan
• Key personnel
• Financial information
• Other important information

Be sure your plan is up to date and provides all the information the lender will need to understand your business and make a fully informed lending decision.

6. Business Practices
Any lender will want to evaluate how you run your business, and you should be prepared to answer these questions:

• Do you have a credit policy? Is it enforced?
• Does your accounting system adequately show the condition and results of your business?
• What is your accounts payable policy? Do you negotiate favorable terms with key vendors prior to placing orders? How current are you with payables? Do you take advantage of discounts for prompt payment?
• What type of insurance coverage do you have? Is there adequate insurance for liability and property damages?

7. Taxes
Are all your payroll, property, and income tax filings current? 
Do you use the services of a qualified tax professional to help ensure that your tax benefits are maximized?

Borrowing money for your business is a serious step. Use the process of getting ready to borrow as a tool to evaluate your business and to plan for its success. The proper preparations can strengthen your business and strengthen your case for borrowing.

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Disaster Recovery Plan Guideline

Every business has the risk that a natural or man-made disaster could disrupt normal operations and ultimately threaten the viability of the business. Fires, floods, earthquakes, thefts, and terrorism are all threats that should be considered.

Having a disaster recovery plan is critical. You may want to organize the preparation of a plan around four objectives:

• Safety of employees
• Preservation of business property, equipment, and data
• Keeping the business running until normal operations are resumed
• Communicating with various constituencies

Employee Safety
Depending on the situation you are facing, the need for medical assistance may vary. At a minimum, here are things to consider:

• First aid kit - Have one or more kits that are easily accessible, and have everyone know the kits' locations
• Trained staff - It may be advisable to have one or more employees trained in basic first aid procedures such as CPR
• Getting assistance - Be sure everyone knows how to get additional medical assistance if needed. Phone numbers and locations of doctors, hospitals, and ambulance services should be readily available
• Evacuation plan - Everyone should know how to leave your business in the chaos of a disaster. You may also want to establish a meeting location to ensure that everyone evacuated safely

2. Business Property, Equipment, and Data
Physical property and equipment can be protected or moved if time and safety permit. If floods are a risk in your location, you may want to consider how you could elevate the equipment to avoid floodwaters or have sandbagging capabilities.

Keep a regularly updated inventory of your firm's equipment and other fixed assets. The inventory should include information such as identification numbers, costs, locations, and where you purchased it.

Make sure all your physical assets are adequately insured.

Protecting your data deserves special attention. The information you use everyday and what you use only occasionally must be protected.

• Store a copy of all computer operating system and important files off-site
• Back up critical data on a regular basis and rotate storage disks (floppies, CDs, tapes) to an off-site location
• Be sure to keep a list of computer passwords. With many programs having a "remember this password" feature, it is often easy to lose track of all the passwords (and IDs) you use
• For important financial records like balance sheets, income statements, and tax returns, keep copies in a secure off-site location
• Be sure to keep copies of critical contracts, licenses, patents, and operating agreements off-site. You may want to update the off-site materials quarterly.

3. Interim Operations
If disaster strikes and you cannot resume normal operations for some period, your customers will still depend on you for products, and your employees will still be depending on you for their livelihood. You need to be prepared.

• Location - Consider identifying somewhere you could function until your existing location can be reoccupied. If you have a very small business, it could be a spare room in your home. If you have a small staff, your accountant, lawyer, or banker may have a conference room they would make available. If your business is larger or if you have special needs, stay aware of available space in your area that you could lease on a short-term basis.
• Supplies - Keep a supply of usual office supplies off-site in case you can't reach your business location. This includes stationery, envelopes, business cards, and often used brochures. You may also want to keep a record of your sources of these supplies so you could reorder in a hurry.
• Business interruption insurance - Be sure to ask your insurance agent about this type of policy. It may not be too expensive and could cover some of the added expenses of operating during a period of disruption.

4. Communications
In the event of a disaster, communication becomes critical both immediately and afterwards.

You must know how to reach all your employees to check on their safety and to let them know your plans. The information you may need includes phone numbers, addresses, email addresses, and contact information of their family members.

Similar information should also be available for customers and vendors.

You may also want to develop a plan to communicate with outside parties. This could include establishing an official contact source for the press who would be knowledgeable and constantly available. It will be critical to convey the appropriate impression.

Conclusion
No one likes to think of disaster striking their business. However, it is something that should be considered and prepared for. Recent history has shown that in times of emergency, some companies are able to handle adversity well and others are not. Be sure your company is prepared.

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Checklists For Renting a Business Location

Choosing and leasing a location for your business is critical. The type of your business will dictate many of your decision-making factors. For example, a retail business that is dependent on walk-in traffic means that you must have a location where there are many people who have an interest in your product or service.

Location issues
Here are some additional factors to consider in choosing a location: 

• Is there adequate space for current and future levels of business?
• Is the space appropriate for your business? Does it have enough private offices, work areas, and storage space?
• Is there adequate parking available for customers and employees?
• Is traffic congestion a problem?
• Does the location suit the commuting needs of employees?
• What types of communication services are available? If your business uses the Internet, are high speed services (T-1 lines, DSL, or cable modems) available?
  Ask other tenants what they are using.
• Is the space conducive to your type of business?

Lease issues
Your lease is important, and so is the relationship with the landlord. A good working relationship will make the call about the leaking roof easier to make, and a good relationship may get the air conditioner repaired just a little sooner.
Here are a list of the most common issues that arise when a lease is being negotiated. Understanding all the lease terms can make the negotiation process easier for both you and the landlord. Depending on your level of comfort, you may want to have a qualified attorney help you work through the leasing process.

Nature and duration of the lease

Be sure to understand the term of the lease and the mechanics of any renewal options. Also be sure to completely understand when you are entitled to possession and use of the property.

Rent

In the lease contract, make sure it is clear when the rent is due and how it is to be paid along with the actual amount to be paid. You should also be sure to understand if there is any "pass-through" of increased property taxes or maintenance costs.

Competition

If the space is being used for retail purposes, such as in a mall or strip shopping center, are there any restrictions on the landlord's ability to lease to your competitors? What are your remedies if a competitor moves in close by?

Subletting

Do you have the right to sublease space if you find you don't need the space within the duration of the lease?

Physical condition

You may want the landlord to make certain improvements before you move in. This may include changing walls or electrical connections. What will be the general condition of the space when you move in? What condition must you leave it in when you move out?

Improvements

You may wish to make improvements such as adding more offices or new carpet to your space during your lease. Be sure your lease allows you to make the improvements and try to get compensated for these improvements at the termination of your lease.

Landlord's financial condition

Will the landlord be able to deliver on all of his obligations for maintenance and up-keep? The real estate market is usually cyclical, and some protections in the lease for your rights may be attractive.

These lists are not all-inclusive. You may want to use lists found in many reference books or on the Internet to make sure all of your issues are covered.

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Business Insurance Checklist

Every business needs insurance. The types and amounts of insurance coverage you need varies depending on the type of business, size of business, and the amount of risk the business is willing to assume. If your business provides personal services or if you are operating the business without a corporate structure, you must consider your personal risks as well. You may want to work with an insurance professional to make sure you have the protection you need.

There are seven types of insurance you may want to consider.

Health Insurance
Providing a health insurance program can be very attractive for employees and business owners but can be expensive. To contain costs, consider sharing the cost with employees and choosing levels of deductibles and co-pays that result in lower costs.

Property Insurance
Business equipment should be insured against damage and theft.
On equipment covered, be sure to have a list of equipment with costs, values, and identification information.

Auto Insurance
Using an auto in your business, even a personal one, may require a commercial auto insurance policy. Speak with an insurance professional to determine the requirements of your business.

Liability Insurance
Claims due to employee actions or negligence can be significant, especially in an age of increasing jury awards.  Some coverage may be provided through other types of policies, so discuss your coverage with an insurance professional.

Business Interruption Insurance
If your business was displaced because of a fire, flood or other disaster, you would need to re-establish the business in another location.
Business interruption insurance could provide the funds needed. Temporary space, equipment and supplies could be covered by a policy of this type.

Workers' Compensation Insurance
This insurance provides coverage for medical and related costs for accidental injuries suffered by employees in performing their duties.  The amount of coverage required varies by state.  Discuss your needs with an insurance professional.

Umbrella Insurance
Umbrella insurance policies fill gaps that may exist with other policies and provide additional coverage beyond the policies.  The costs are usually relatively low, and policies are offered by many insurance companies. Some professional organizations also offer these policies.

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BancCard

As credit and debit cards get more secure, people carry cash less and less.  Don't loose business because your company only accepts cash.
Southeast Community Capital has partnered with BancCard to provide our clients with the lowest cost in check and credit card services.  
BancCard, a registered ISO/MSP of US Bank, Minneapolis,MN, wants to help your business with credit card, debit card, and personal check sales, whether on-site or online. 

For more information on BancCard and its services, contact SCC's BancCard representative Dale Hardiman at (615) 452-1752, or email Dale at dhardiman@banccard.com. 
You can also check out BancCard's web site.

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SBA Small Business Planner

The Small Business Administration (SBA) website has a small business planner that can aid you at any stage of your business growth.  From getting started to getting out, the SBA website may have an answer for you.

SBA Small Business Planner

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Types of Business Structures

Sole Proprietorship

General partnership

Limited partnership

Limited-liability company (LLC)

C Corporation (Regular corporation)

S Corporation (Subchapter S corporation)

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Business Comparison Chart

Example:

For you to fill out:

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