Monday, October 25, 2010

Have a Profitable Hobby? You May Need a Permit.

When times are tough, savvy individuals find ways to make extra money by turning their hobbies into side jobs by selling their homemade products or services.


Whether selling arts and crafts online or doing freelance work, entrepreneurs who have earning money from their hobbies need a local city, or county business license.

In Chicago, the Department of Business Affairs and Licensing processes license applications and once complete, the City Clerk issues business licenses.

If providing certain services from one’s home or offering goods, check with the city's zoning and selling requirements as well.

For more information on starting your own business or to become a BBB Accredited Business, visit www.bbb.org

Monday, October 18, 2010

Don't wait until retirement to create a business succession plan

While it’s not fun for a business owner to think about the impact their death or a disability would have on the company, it is nevertheless important to create a succession plan sooner rather than later. The Better Business Bureau outlines five steps to create a solid succession plan and ensure the stability of the business if something unexpected should happen.




A business succession plan is extremely vital to ensure the stability of the business and avoid paying to many taxes or damaging the family finances, but many small business owners lack one. According to a 2008 PNC Bank survey of business owners, 77 percent had a will but only 33 percent had a succession plan for their business.



“While your retirement may seem far off, you should plan for the unexpected by taking the time to create a thorough succession plan,” said Steve J. Bernas, president & CEO of the Better Business Bureau serving Chicago and Northern Illinois. “Waiting until retirement to think about the next generation of the business puts both your family finances and the future success of the company at risk.”



The BBB recommends taking the following steps to create a cohesive and comprehensive succession plan:



Have the tough conversations with family and partners.

When beginning the planning process, get the thoughts and opinions of family members and business partners on their future involvement with the company. This will give you a better idea who really wants to take on the challenges of the company and who might prefer a different path from the family business while perhaps maintaining an equity stake. Also, circle back around and make sure all interested parties understand the succession plan after it is finalized.



Get professional help. A succession plan isn’t just about naming an heir; it’s also a matter of navigating tax laws and minimizing the financial burden on family members. The financial aspect of a succession plan can be very complex. An attorney and/or financial planner can walk you through the process, make sure you’ve tied up all loose ends and help you ease the potential financial strain on family and the business.



Think about the staff. A succession plan isn’t just about tending to finances and ownership. It is also about management and making sure the company can run smoothly in your absence. Make sure that your staff is trained to carry on without you—this includes the high-level strategic plan and the day to day basics of making the business work. Consider creating basic succession management plans for key staff to ensure continuity in service and productivity should someone else depart.



Think about the customers. Customer loyalty for a small business often rests heavily on the owner. Customers might head off to the competition if they think that the company can’t carry on without you. Consider how you can make the transition seamless for customers and not lose the trust they have built in your company should you leave. Encourage relationships between customers and other staff so that they know that the business is more than just you.



Update the plan every few years. Revisit and revise the plan every few years. Make sure it continues to reflect the current status of the business as well as your family situation.



For more trustworthy small business advice, visit www.bbb.org

Monday, October 11, 2010

When to Shut the Door on a Traveling Salesman

When salespeople knock on your door, they could represent any number of different legitimate products and services such as magazines, cleaning supplies and even frozen meat and poultry. They might also be itinerant workers who are offering a low-ball estimate to fix your roof or repave your driveway. Regardless of what they are selling, protect your home and your wallet by confirming their credentials.


The BBB recommends being cautious of a door to door salesperson or itinerant worker if they:

Use high pressure sales tactics. A reputable salesman will give you time to think through the deal and make an appointment to return at a later date and provide written information. Watch out if you’re asked to sign up immediately before you do your research. Do not give in to high-pressure sales tactics—even if the deal supposedly won’t last long or the salesperson is aggressive—it’s worth it to stop and think it over first.

Offer a deal that sounds too good to be true. Some salesmen might offer an extremely good price for their products or services. The adage holds true that you get what you pay for and many people have been quickly disappointed when the products didn’t live up to the hype or the company did a shoddy job.

Fail to follow federal law. Federal law requires that if you purchase more than $25 in goods, the salesperson must inform you of your rights to cancel within three business days. Called the “cooling off” rule, these rights are typically included with the company’s contact information on the receipt or contract. Each community, village, city or other body politic requires permits for door to door sales according to their own ordinances. Ask the salesperson to show his or her permit.

Work for a company with a poor rating from your BBB. Before you break out your checkbook, always check the company out with your BBB first to see their rating and if they have any complaints they’ve received in addition to BBB’s overall rating at www.bbb.org

Pay with a check or credit card—rather than cash—in order to take advantage of the consumer protections provided.

Shop only Accredited Businesses. For more information visit www.bbb.org/chicago

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