After toiling away in your cubicle for most of the day, you decided that wasn’t the life for you. So you started your own business. Most likely, it was more complicated than you ever imagined. While you may not have a boss, you now have customers you need to satisfy.
Running your own business can be very rewarding, but calling it hard work is an understatement. You will face problems you never encountered before. Your financial plan and strategy will require a makeover.
Many small businesses are hungry for cash. Federal government programs like the Canada Small Business Financing Program offer financing for small businesses. Proper tax planning can also boost cash reserves by letting you keep more of your profits. If you overpay your taxes, you are leaving money on the table that should belong to you.
When making hiring decisions, it can be tempting to pay low wages to save money. However, what seems like a cost-saving measure now can end up costing a lot more later on. Hiring unskilled employees, not investing in training, and high employee turnover can wreck your business. Everyone wants low costs, but you also have to invest in your business to make it grow. Paying competitive wages and offering benefits are a few ways to tilt the odds of success in your favor.
Key Person Insurance can be a financial deal breaker if you suffer a serious injury. You are the most valuable asset in your business, and you want to ensure that your business can survive if you are on the sidelines.
Most importantly, make sure you are not “all in” with your business. You will be able to think more clearly if you know it’s not the end of the world if things don’t work out. Maintain an active retirement plan that is separate from the business.
Below are six quick tips to help you achieve success in your small business:
Hiring top talent
In today's marketplace, to find and retain the best employees it simply isn't enough to only offer full-time hours and competitive wages. Employers who offer full company benefits ( Extended Health & Dental, Vision Care, etc.) can gain a competitive edge over companies that do not offer similar compensation packages.
For small businesses looking to expand their capabilities there are many different financing opportunities available today. There are federal government programs offering financing help especially for small businesses. There are also hundreds of grants available to small businesses and the qualifications are often far easier than most people imagine. A simple Google search for "small business grants" will usually result in a list of a number of companies ready to help business research and obtain Federal and Province grant money.
Look for ways to be tax efficient
Every small business enterprise involves financial transactions ( wages, investments, succession planning ) that have tax consequences. Every small business should work with a qualified accountant who can assist them with creating the most tax-efficient structure for their business.
Insure your most valuable asset
In every small businesses there is at least one person – likely the owner – who is the cornerstone of the entire operation. Every business owner should consider protecting themselves with Key Person Insurance, so that any loss(death) or injury would not seriously affect the business’s survival.
Don't keep all your eggs in one basket
While many business owners rely heavily on the sale of their business as their primary retirement planning solution, this is not always the wisest strategy. Every small business owner should consider the wisdom of a strategic retirement plan in combination with their business succession plan so that they can enjoy a secure retirement without relying too much on the sale of their business.
Practice proper risk management
When a small business owner suffers from a disability, a critical illness or even a premature death there are far-ranging impacts to a families financial well-being, Every business owner should implement a strategy to mitigate these different risks with a combination of life and disability insurance plans.