This article is provided by the Greater Scranton Area SCORE Chapter.

A popular American tradition is the family business. It gives spouses, parents, children, and others a chance to share a dream that can continue to grow and prosper generation after generation.

But without proper planning and management, family businesses can also be the source of contention, acrimony, and even irreparable harm to once-loving relationships. That’s why it’s important for aspiring entrepreneurs to fully understand the pros and cons of going into business with relatives and in-laws. The needs of the business may not always be compatible with family harmony, resulting in a situation that handled improperly, can jeopardize the survival of both.

When bringing family members into a business for the first time, especially as investors or in a startup situation, you should consider putting the business relationship in writing. Family members sometimes buy into the excitement of a business startup without a clear idea of their role once the business is underway.

In an ongoing family business, it’s important to treat family members fairly. While some experts advise against hiring family members, that sacrifices one of the great benefits of a family business. Countless small companies would never have survived without dedicated family members. But avoid favoritism. Pay scales, promotions, work schedules, criticism and praise should be evenhanded between family and non-family employees.

Don’t become the employer of last resort for every distant relation who calls. Base employment on the skills or knowledge they can bring to the business. If your kids will be joining the business, make them get at least three to five years business experience elsewhere first to help them gain perspective of how the business world works outside of a family setting.

Problems and differences of opinion are common in a family business, so it’s important to keep lines of communication clear. Weekly meetings to assess progress, air differences and resolve disputes work well for many family firms.

Just as solo entrepreneurs and non-related partners need to separate their business and personal lives, owners of family businesses need to prevent work-related issues from dominating family activities. While it may be difficult to totally confine shop-talk to the workplace, make it a standing rule not to discuss work and business issues at social gatherings or at designated “family times” where the focus should be on other things.

For additional planning help for your small business, contact SCORE “Counselors to America’s Small Business.”  SCORE is a nonprofit organization of more than 10,500 volunteer business counselors who provide free, confidential business counseling and training workshops to small business owners.  Call (570) 851.1608 or visit www.scorescranton.org to contact the Greater Scranton Area SCORE Chapter.

This article is provided by the Greater Scranton Area SCORE

Sales and advertising are often associated with marketing. While these are an important part of marketing, there is a horde of other tools and tactics. These tools help to enhance your business’s attractiveness and customer visibility. Using these resources along with careful research and planning, help to yield a successful marketing strategy.

The key is to think of marketing not as a single action but rather a combination of steps designed to identify, attract and retain profitable customers, and to differentiate your business from the competition. It encompasses everything from your company name, logo, and service lines to advertisements, public relations, presence at trade shows, and community involvement.

While it’s helpful to use comparable businesses as a guide, what works for them may not be appropriate for you. Marketing strategies need to be tailored to your business and target customer base. To prepare yourself for marketing, create a detailed profile of your ideal prospect. As you create your marketing message, aim it at them and list the benefits they will receive. Be certain your marketing message highlights the special knowledge and expertise you offer.

Look for ways to make the buying process easier for your customers. What roadblocks can you remove? Simplify everything; eliminate potential interruptions in the sales process and make decision-making as painless as possible for your customers.

Put your marketing budget in proper perspective. You might, for example, think of marketing as your ace-in-the-hole rather than merely a “cost.” Try to set a budget and a pace that lets you market continuously. Customer memories are short, and they are bombarded with thousands of marketing messages and images daily. Your effort must be ongoing or people will quickly forget.

Match your marketing to your primary market. If it’s a local market, then that’s where your marketing focus should be. Broadly focused newspaper or radio advertising, for example, might be the wrong choice. Instead, consider marketing neighborhood-by-neighborhood.

A good place to find marketing help is the American Marketing Association’s Web site, MarketingPower.com. The site’s Best Practices section contains valuable guidance for small businesses in the areas of research, Internet marketing, advertising, public relations, customer service tips, and many others.

To learn more about marketing your small business, contact SCORESCORE is a nonprofit organization of more than 10,500 volunteer business counselors who provide free, confidential business counseling and training workshops to small business owners.  Call (570) 851.1608 or visit www.scorescranton.org to contact the Greater Scranton Area SCORE Chapter. “Counselors to America’s Small Business.”

We have some exciting news to share with the NEPA small business community!

At a press announcement in Scranton this morning, we introduced several new and expanded components to our existing financing programs:

STEP Loans are available from $250 to $2,500 to provide access to credit for credit challenged individuals who are committed to good credit management. This is especially terrific for those who have decided to become their own boss, starting their own companies, but who need a small “starter” loan to take the next step.

Small Business Loans go from $2,501 to $75,000 help entrepreneurs that do not meet bank criteria start and grow successful businesses. Whether it’s for equipment, renovations or working capital – these loans can help.

Small Business First Loans provide up to $200,000 or 50% of project costs for businesses located in Lackawanna County that meet eligibility criteria.

MetroAction does not just provide loans. They also provide business training and counseling to ensure long?term business success. All businesses involved in the STEP Loan program are required to attend the Smart Start counseling program that pairs business owners up with mentors from SCORE to help entrepreneurs start smart and grow strong.

The Small Business Institute is a comprehensive training program that provides practical, hands?on skills needed to develop, manage and grow a successful business.

To learn more about MetroAction’s programs and service, visit our website www.MetroAction.org.

Facts:

$18,000 Average loan size
89% Historic repayment rate
85% Clients still in business after two years
605 Average credit score

Pictured in the photo (from left to right) are: Front Row:  John Augustine, vice president, The Greater Wilkes-Barre Chamber of Business and Industry; Christina Hitchcock, business development administrator, MetroAction; Kristine Augustine, vice president, MetroAction.  Back Row: Austin Burke, president, The Greater Scranton Chamber of Commerce; Lori Reed, deputy director, City of Scranton Office of Economic and Community Development; Dee Kaplan, deputy secretary, Commonwealth of Pennsylvania Department of Economic and Community Development; Bob Maximowicz, business development specialist, U.S. Small Business Administration; Steve Lawrence, board member, MetroAction.

This article is provided by the Greater Scranton Area SCORE chapter.

Broad economic slowdowns can often trickle down to small businesses, including those in relatively stable industries or geographic locations.  Individuals tend to cut back on discretionary spending while corporations curb routine activities, delay major purchases, and shelve new initiatives.

For many small businesses with limited resources, these and other factors often combine to pressure bottom lines past the breaking point, creating a domino effect of other dilemmas such as a credit crunch or layoffs.

A downturn doesn’t have to spell disaster for your small business, however.  Good financial management practices will help you weather even the worst of economic times, and be ready to capitalize on new opportunities will inevitably come with good times return.

Begin with the basics.  Even when times are terrific, no small business can survive without good record keeping, budgeting, cash flow monitoring, and credit management.

Consult your bank.  Lenders can tap their vast experience in economic cycles to advise you on issues specific to your business and industry.  Depending on your projected long-term expenses, consider arranging a line of credit in case a cash flow gap occurs.

Be on good terms with your creditors.  Falling behind on payments is never the answer, even if it’s “just this once.”  Creditors will be more amenable to renegotiating terms to small businesses they consider to be conscientious and reliable.

Watch your receivables.  By the same token, you need to stay on top of any outstanding debts to your company, particularly problem accounts.  Be firm, but also willing to negotiate where appropriate.

Scrutinize your spending.  Rather than arbitrarily slashing your budget, strive to spend only on those things that have a justifiable positive effect on your business.  That will make it easier to redirect money to areas that enhance business performance.

Step up your review of financials.  Assessing your reports weekly or biweekly rather than monthly will put you in a better position to make informed decisions.  Similarly, a monthly or quarterly review your business plan enables you to adjust your strategy and direction to changing market conditions.

Keep marketing in the mix.  Look for cost-effective ways to keep your company visible to current customers and potential new markets.  They may be ready to restart their spending long before the headlines proclaim an end to the economic crisis.

For additional planning help for your small business, contact SCOREwww.scorescranton.org to contact the Greater Scranton Area SCORE Chapter. “Counselors to America’s Small Business.”  SCORE is a nonprofit organization of more than 10,500 volunteer business counselors who provide free, confidential business counseling and training workshops to small business owners.  Call (570) 851.1608 or visit

As you launch or expand a business, keeping track of the money, preparing tax returns and performing other financial tasks can quickly become a burden. If you need more time to do other things, it might make sense to turn over tax, accounting and other financial chores to outside specialists.

Choosing the right type of tax, accounting, bookkeeping or other financial help is an important decision. An outside accountant can be one of your most trusted business advisors and a key to your success. Although many business owners work with big national firms, most prefer to work with small independent firms or solo accounting professionals.

Accounting services differ from bookkeeping services, however. An accounting firm prepares financial statements and tax returns based on the numbers that you give them via your own in-house books. Bookkeeping services, if offered, will be extra. If you plan to hire your own bookkeeper, make sure the person you choose is qualified. One way is to use the “Bookkeepers Hiring Test” available free from the American Institute of Professional Bookkeepers at their Web site, www.aipb.org.

Before selecting a certified public accountant (CPA) or other financial pro, list the services you think you need, such as tax preparation, financial reports, balance sheets, invoicing, payroll services, general bookkeeping or someone to set up your books. Some firms may handle it all, or you may need to split the tasks. CPA Directory is a huge online listing of CPAs nationwide and can help you find an accountant in your area.  The Web site also offers helpful advice on hiring and working effectively with a CPA. Visit www.cpadirectory.com.

And don’t forget about Enrolled Agents. EAs are licensed by the Federal government to prepare tax returns. They have either worked for the IRS or have passed a rigorous IRS exam. They are savvy tax experts, but generally don’t have the degrees of CPAs and tend to charge less. Visit the National Association of Enrolled Agents Web site at www.naea.org.

Fees vary greatly among accountants, from $50 per hour to $300 or more. Some firms will provide a specified list of services for a flat monthly fee, and may provide less costly help for bookkeeping and other tasks that don’t require CPA-level training. If you are considering a larger accounting firm, find out which people you will be working with directly. Also try to match your general philosophy with a firm that is as conservative — or aggressive — as you are on tax matters.

For additional planning help for your small business, contact SCORE “Counselors to America’s Small Business.”  SCORE is a nonprofit organization of more than 10,500 volunteer business counselors who provide free, confidential business counseling and training workshops to small business owners.  Call (570) 851.1608 or visit www.scorescranton.org to contact the Greater Scranton Area SCORE Chapter.

Small business owners often try to save money—especially in the early going—by using independent contractors instead of hiring full time employees. Using independent contractors, or “contract workers,” means the business doesn’t have to withhold taxes, pay Social Security or Medicare or meet numerous other employer responsibilities.

Many such arrangements, however, wilt under IRS scrutiny. And the strategy can backfire if someone later claims they should really have been treated, and paid, as an employee.

Deciding who can legitimately work as an independent contractor and who must be given employee status has become a difficult matter for small business owners. You can’t simply choose what’s best for you. The IRS and equivalent state agencies are strict on worker classification issues.

Remember that independent contractors work for themselves. They operate their own business. You are their client, not their employer. You don’t dictate their hours or control how they perform their work. In the eyes of most government agencies, a worker is an employee unless you can prove otherwise.

Contractors control when and where they work. Avoid setting a pattern of daily or weekly work hours dictated by your business. Also, independent contractors do not usually have a permanent or continuing relationship with the business and have time to pursue other clients. Plan to compensate contractors on a per-job basis, not weekly or monthly.

And since contractors are paid to complete a set task, they may bring in others to help, at their discretion and on their payroll. They also should use their own tools and technology and be responsible for their incremental expenses.

Contractors can’t be fired as long as they produce results that meet their contract specifications. Do not include them under any insurance or benefits coverage you have for employees. Independent contractors are subject to making a profit—or suffering a loss—based on their own skills and expertise. Always require an invoice before making payment.

Before you agree to an independent contractor relationship with anyone, make sure you understand what that means and carefully weigh the pros and cons. If you misclassify a worker, you could be liable for back employment taxes plus penalties.

Getting sound advice on management issues such as independent contractor status is vital for your small business. For help, contact  SCORE “Counselors to America’s Small Business.”  SCORE is a nonprofit organization of more than 10,500 volunteer business counselors who provide free, confidential business counseling and training workshops to small business owners.  Call (570) 851.1608 or visit www.scorescranton.org to contact the Greater Scranton Area SCORE Chapter.

Owners of new and growing small businesses today know one thing for sure: conditions on the business playing field can change rapidly. The technology that seemed cutting edge last year is now outdated; or worse, obsolete. Buyer moods can swing dramatically, and marketing strategies are in constant flux.

Anticipating trends can be extremely valuable in keeping you current on everything from sales strategies and customer desires to technology tools and the general economy. As your business grows, change will be inevitable and small business owners should constantly look ahead and seek out ways to shake things up.  The more you test the winds of change, the better your chances of success down the road.

But how can you tell the difference between a fleeting fad and a true trend? Louis Patler, a market research guru for companies such as American Express and Dell, has spent decades tracking emerging trends and studying their impact on business. He says the key to successfully piloting a business in the years ahead will be embracing new ways of thinking.

For example, Patler says that truisms like “stick to what your business does best” are outmoded. If you want your business to grow, consider that past business traditions and processes might only hold you back. Trying new approaches is vital.

Not all customers are created equal. Some are more valuable and loyal than others, and those are the ones you should lavish the most attention on with special savings and service offers.  And don’t expect loyalty from employees. As American society becomes ever more mobile and labor shortages worsen, workers won’t stay on a job for more than three years.

Advances in technology will continue to radically change how small companies do business. You will need to keep up. Small business owners who know how to acquire and manage information will achieve the most success. Capturing and analyzing data about customer needs, wants, behavior and how they use your product or service will become increasingly critical.

For additional planning help for your small business, contact SCORE “Counselors to America’s Small Business.”  SCORE is a nonprofit organization of more than 10,500 volunteer business counselors who provide free, confidential business counseling and training workshops to small business owners.  Call (570) 851.1608 or visit www.scorescranton.org to contact the Greater Scranton Area SCORE Chapter.

E-commerce sales by small businesses are increasing rapidly and could double, triple or more during the next five years. Web sites are no longer a novelty; they are a necessity for small firms, solo operators and home businesses of almost any type.

Meanwhile, customers have become vastly more Internet savvy than they were just a few years ago.  They feel more comfortable buying online and they expect Web sites to be clear, crisp, informative and highly functional. Small businesses that don’t deliver higher levels of Web sophistication risk being left behind.

A good starting point is avoiding errors that often doom Web sites to mediocrity. It’s not a matter of making your site complicated. Today, the “less is more” axiom applies and often spells the difference between a Web site that delivers for your small business, and one that doesn’t.

Don’t neglect your site. If you want the Internet to help build your business, make your Web site a top priority in your daily operations. If your products, services, prices, location, hours, contact information and marketing messages change, make the updates immediately. Outdated information frustrates customers. Place your contact information in a prominent location. Many potential customers visit Web sites merely for basic contact details.

Flashing images, scrolling text and blinking buttons may have seemed clever and high-tech when first introduced, but now they are simply annoying. Dump them in favor of graphics that enhance your site usability. Avoid the temptation of cute bells and whistles. Make a fast-loading site a top priority.

And set up a system for tracking your site activity. Don’t be in the dark about what’s happening on your site. Simple and inexpensive Web analytic tools can point to areas that need improvement. Two top sources for Web analysis tools are WebTrends.com and SiteCatalyst.com. Visit the sites and check out the free trial offers.

To learn more about ecommerce for small business, contact SCORE “Counselors to America’s Small Business.”  SCORE is a nonprofit organization of more than 10,500 volunteer business counselors who provide free, confidential business counseling and training workshops to small business owners.  Call (570) 851.1608 or visit www.scorescranton.org to contact the Greater Scranton Area SCORE Chapter.

For a small business, taking the first steps into advertising can be an intimidating and mysterious process. Even though we see advertising everywhere, creating and using ads ourselves can seem alien and expensive. Understanding how the medium works and what it can and cannot do for a small business is tougher than it seems. And there is always uncertainty over results. 

Think of advertising as one element of the broader area of marketing. You recognize it in many forms, including magazines, newspapers, directories, online search engine ads, Web site banners, radio spots, TV, billboards, flyers, direct mail and others. Before you spend your hard-earned money on advertising, you’ll want to investigate what to realistically expect. Only then should you draw up a plan for moving ahead.

Ads can do the following:

• Attract new customers, prospects and leads.
• Encourage existing customers to spend more on your product or service.
• Build credibility, establish and maintain your “brand” or unique business identity, and enhance your reputation.
• Inform or remind customers and prospects of the benefits your business has to offer.
• Promote your business to customers, investors or others and slowly build sales.

But here’s what advertising probably cannot do:

• Create an instant customer base.
• Solve your cash flow or profit problems by producing an immediate sales windfall.
• Cure poor or indifferent customer service.
• Create benefits that don’t really exist or sell products and services that nobody wants.

In short, advertising won’t guarantee quick sales for your product or service by itself, but it will get you noticed, if you do it right. That means you must know, as precisely as possible, the demographics of your target audience and craft a precise message about your product or service that will touch them. You must give customers a compelling reason to call, visit your Web site or stop by your business.

Your ad must also stand out in some way. If it fails to grab your potential customers, they are not likely to respond. Frequency is also key. A single ad in one place won’t do much. Getting people to see your ads as often as possible in different places will deliver better results.

To learn more about advertising your small business, contact SCORE “Counselors to America’s Small Business.”  SCORE is a nonprofit organization of more than 10,500 volunteer business counselors who provide free, confidential business counseling and training workshops to small business owners.  Call (570) 851.1608 or visit www.scorescranton.org to contact the Greater Scranton Area SCORE Chapter.

Choosing to go into business for you is a major decision that usually means a commitment to hard work and long hours.  As you struggle to build your business, however, you also must be careful not to overdo it and succumb to business owner burnout. It’s vital to take some time off to recharge your personal batteries.

But there’s a problem. Many business owners are afraid to leave, even for a short period. They fear that something will go wrong or they’ll miss out on that next big opportunity. With so much to do, how can an entrepreneur ever relax?

According to a survey conducted by American Express, 40 percent of the smallest business owners—those with less than $200,000 in annual revenues—plan no vacation time whatsoever in any given year. And even those who do schedule a break never really get away. One of every three link vacation time to a business trip and half will check in with the office at least once a day, if not several times.

According to the AmEx survey, these are the vacation-blocking concerns cited most often by business owners:

• There is no other competent person to leave in charge and others will make the wrong decisions.
• An important client or customer will not receive appropriate service.
• The business will miss a new opportunity.
• An operational breakdown will occur without anyone to solve the problem.

Despite these concerns, you can schedule a refreshing getaway with some careful advance planning. For example, draw up a list of worst-case scenarios and brief those in charge on the possibilities and chief concerns of each customer.

Tell key clients or customers in advance of any extended time away you are planning. Introduce your stand-ins and express your confidence in their ability to handle any issues that may arise. If you never delegate important tasks to others at your business, you can’t expect them to fill your shoes when you take time off. To create a saner schedule for yourself, and achieve a comfort level that good things will happen when you’re not there, learning to delegate responsibilities is vital.

For more small business management ideas, contact SCORE “Counselors to America’s Small Business.”  SCORE is a nonprofit organization of more than 10,500 volunteer business counselors who provide free, confidential business counseling and training workshops to small business owners.  Call (570) 851.1608 or visit www.scorescranton.org to contact the Greater Scranton Area SCORE Chapter.