One involves people; the other, finances. But both are essential to run your business effectively.
April 16, 2020 5 min read
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No one can start a business with absolutely no help. Whether you’ve incorporated your own team from the outset or you simply need the right advisors to help you launch, you need to know the ins and outs of building a truly supportive team.
Support teams for small enterprises are critical. Here are some professional areas in which you might want to seek extra help:
- Financial and tax advice. CPA firms can help you get your books in order, set up your payroll, map out projected quarterly tax payments and assist with taxes.
- Banking. Ask fellow professionals and entrepreneurs what banks they use and their pros and cons. Focus on what you need out of a bank — lines of credit, ease of use for online services, merchant services — and let your needs fuel your decision when setting up your finances.
- Legal. Attorneys will provide expert advice and services, but for a price. For initial advice at startup, consider reaching out a local SBA for free consulting services to get started on the right foot and choose the legal structure that’s best for your situation.
- Insurance. Similar to banks, your choice of insurance provider (or agent) should be based on your needs and preferences. Ask for recommendations within your network and consider what kind of service you need, your price range and the scope of coverage your ageless startup might require.
- Distribution. If you’re planning to sell a product, you’re going to need logistics help unless you plan to store and ship items yourself. Look now for a distribution company that specializes in moving your type of product.
- Marketing and Sales. Unless you’re already entrenched in the marketing world of your particular industry, you’ll want an extra hand reaching out to your target audience. If you want to sell directly to the audience that best fits your product and/or service, you need someone who can focus on just that task.
- Social Media. If you can’t tell Facebook from Snapchat, you need help. Each social media platform has its own way of reaching customers, both in paid and free methods of outreach. Trust me here — find someone who knows the ins and outs so you can monetize your efforts on each platform.
- Advertising. It’s not necessarily hard to place an ad in the paper or online, but an ad professional will know the best places to advertise your product or service based on your industry and audience.
Admit that you need knowledge, time and resources you don’t already have. And that’s OK. Professionals cut red tape you don’t even know is there most of the time. Why wouldn’t you? By admitting to yourself that you need help with these tasks, you can position yourself to make connections with these kinds of professionals by asking around for referrals.
Next, you’ll want to create an internal management structure that deals with the details and creates peace of mind for all involved. Start with sound money practices, structures and tools. For example, think about how you’ll keep track of your information like contacts, accounting, etc. Will you maintain databases on your own or shop out the function to a CPA or financial firm? Either way, be sure to create a system to document all orders received, including dates received/paid, with full documentation of payment information. If you do it yourself, you can use a simple, homemade version (like an Excel spreadsheet) initially, but there are also many computer programs and online services like QuickBooks for order and payment management available.
Set up money and tax-management systems that work for you. One way to do this is to create a money map of how money will come in and out of your new enterprise. Show your financial advisor (CPA firm) your money map. They can translate that into something called a chart of accounts, which codifies all the ways you earn and spend money.
Here are a few more tips for setting up systems that will help you keep track of your funds and ensure that you pay your fair share to Uncle Sam:
- Open a business-specific checking account. Apply for a business-specific credit card. NEVER mingle personal and business funds. Always keep a wall between them.
- Set up quarterly tax payment schedules. Check with your attorney and financial advisor for advice specific to your circumstances.
- Determine, with your advisors, if you need to collect sales taxes on the goods or services you provide.
- Request your Federal Employer Identification Number (FEIN) from the IRS. Even one-person businesses need this. There’s no charge. You can apply online.
Remember: Smart money management practices aren’t only important to the health and wealth of your business, but also to create peace of mind. Keep secure records of all financial transactions so you always have them to refer to should the need arise.