How will your LLC be Governed?

By: Stacey Romberg, Attorney

When limited liability company (LLC) members chose to work with an attorney to form their business entity, the attorney will draft an “Operating Agreement,” which is also sometimes referred to as a “Limited Liability Company Agreement.” RCW (Revised Code of Washington) 25.15.018(1) provides that an Operating Agreement governs “[r]elations among the members as members and between the members and the limited liability company” and, if applicable, “[t]he rights and duties . . . [of the LLC] manager.”  In other words, the Operating Agreement sets forth the procedures for how the LLC will be governed. An attorney drafts this governance document in consultation with the LLC members. An Operating Agreement is needed for LLCs that have one member, hundreds of members, and everything in between. Sometimes, in addition to the lawyer representing the business entity itself, the LLC members will retain their own individual attorneys to advise them confidentially concerning the Operating Agreement’s provisions and assist them in negotiating for beneficial terms.

What happens if the LLC members fail to hire counsel to draft the LLC’s Operating Agreement? What if instead the LLC’s members shake hands on a verbal agreement? Previously, the Revised Code of Washington required Operating Agreements to be in writing. But the Washington Limited Liability Company Act, which became effective in 2016, changed that – instead indicating that these agreements can be oral or implied.  While oral Operating Agreements are now allowed under Washington law, virtually all business attorneys would nonetheless highly recommend that the Operating Agreement be in writing. Suppose you have a dispute with another LLC member? Suppose you want to sell your interest and move on? Or suppose you pass away, and your spouse seeks to collect your share of the business’s value as an asset of your estate? Perhaps the business was only worth a few dollars when the handshake occurred, but after years of hard work it has significantly increased in value. Would you want to rely solely on a handshake under those circumstances? Or would you prefer that the rules of the road were clearly set forth in a well-crafted document prepared by the LLC’s attorney?

If the LLC does not have a written Operating Agreement, and if the courts are unable to find the existence of an oral or implied agreement, RCW 25.15.018(2) provides that Washington law, specifically Chapter 25.15 of the Revised Code of Washington, “governs the matter.” In other words, if you fail to proactively provide for governance of your LLC, the answer to the question of “How will your LLC be governed?” will be found in statutory law, even if the default statutory language runs contrary to your own wishes or presumptions as to how your business should function.

For example, suppose ABC, LLC has three members. The first LLC member, Jane, makes an initial capital contribution of $300,000 into the business – an inheritance received from her grandmother. The other two members, John and JoAnne, each provide $10,000 worth of capital. ABC has no Operating Agreement. Jane, through a tip from her brother-in-law, finds a perfect and affordable commercial space to lease located in the Greenwood neighborhood of Seattle. John and JoAnne oppose the move, arguing that the business should instead operate out of JoAnne’s mold-infested basement for free. Even though Jane invested, by far, the most capital, under the 2016 Washington Limited Liability Company Act, each LLC member gets one vote unless the Operating Agreement provides otherwise. Here, where ABC, LLC does not have an Operating Agreement, JoAnne and John outvote Jane, and into the basement they go. Does that result seem fair to you, given the disparity in what each member contributed? It may not be fair. And Jane may not have envisioned this result when she deposited her inheritance into the LLC’s bank account. But again, since the LLC members failed to develop an Operating Agreement, Chapter 25.15 of the Revised Code of Washington will govern the LLC’s decision-making process about where to locate the business.

Don’t be caught off guard by unexpected results in terms of how your business will be governed. Take charge, and proactively work with counsel to develop a comprehensive Operating Agreement so that you know, without hesitation, the answer to the question: “How will your LLC be governed?”

Stacey L. Romberg is the founder of a virtual law firm focusing on business law, estate planning and probate. More information can be found at www.staceyromberg.com.

Attend Stacey Romberg’s seminar “Business Law Essentials” at the 23rd annual free Biz Fair on Saturday, Sept 21.

The Cost of Customer Service

By: Debbie Page, Business Coach for Women

Customer service isn’t just a good idea. It’s the force that drives business. Loyalty isn’t a fad. It’s a relationship that needs be cultivated.

Think about the purchasing decisions you make. Which brands or companies have earned your loyalty, and therefore more of your dollars? Your own habits should be enough to indicate there is something to be said for customer loyalty. You know from personal experience that being the cheapest or fastest option isn’t enough to earn your business and a great customer service experience is more than getting a thank you email.

Your customers and clients know it too.

So, here’s the question: What does your documented client retention and loyalty program include? If you’ve made big investments in marketing and advertising to get ‘em – how are you going to keep ‘em?

I’m going to hit pause for just a second and draw your attention to the word documented. I am a huge fan of having documented systems and processes. After more than 20 years in business, I know documented systems and processes help you maintain consistency and deliver results. If your customer service touchpoints and action items aren’t documented you don’t have a plan, you have ideas.

You need to turn those ideas into items you can execute on consistently if you want to grow your customer base and your bottom line.

Just take a look at a few of the numbers I shared recently when talking about the importance of Customer Loyalty.

  • 20% of your customer base is made up by your loyal customers. Those customers will end up driving 80% of your business.
  • It will cost you five times more to acquire a new customer than to keep an existing customer.
  • 68% of customer defection happens when a customer feels like they were treated poorly
  • 95% of the people who have had a bad experience will never tell you.

Those numbers underscore the importance of customer loyalty. Give customers every opportunity to become loyal clients by including these five things in your client retention plan.

5 Ways to Increase Customer Loyalty.

  1. Provide regular updates. Stay in communication with customers through newsletters, e-zines or email updates. Share important information, exciting news or resources they might find valuable. Commit to regular updates and stay in touch.
  2. Under promise and over deliver. Manage expectations by clearly communicating what your customers or clients can expect from you every step of the way. Then surprise them by over-delivering on those promises. For example, if you say you’ll have a contract to them by Friday surprise them by sending it over Thursday.
  3. Show appreciation. Handwritten notes, small gifts, or phone call just to say thank you can go a long way in showing customers how much they are valued and appreciated.
  4. Acknowledge special occasions. Birthdays, work anniversaries and business milestones are all special occasions that can be acknowledge and celebrated in small ways throughout the year.
  5. Remember what’s important to them. Make notes in their client profile of personal interests. Are they a dog lover? Football fan? Quilter? Make a note and use it to surprise and delight them through the year.

Here’s one last thing to consider, you need to develop a process to create customer loyalty whether you have five customers or 5,000 customers. It doesn’t matter which stage of business you’re in, get started and let it grow and develop with you.

Growing your business is easier when you’re not trying to grow it alone.

Want more great insight from Debbie Page? Join her seminar “Marketing Tips and Advice” at Biz Fair at 2:45 p.m. on Saturday, Sept. 29 at Renton Technical College.

Why Certify Your Business?

Businesses and OMWBE Certifications

By: Kathryn Akeah, Washington State Office of Minority & Women’s Business Enterprises

Small business owners ask us all the time. Should I get my business certified? What kind of certification is best? The quick answer is yes and all of them that you qualify for! Of course, the long answer has a few more details. First, let’s start with the foundation.

Why certify your business?

To verify certain aspects of the business. Certifications can be important to show who owns the business, where products come from, or how the business functions.

What does OMWBE certify?

OMWBE certifies that a business is owned and controlled by a person or persons who are minorities, women, or socially and economically disadvantaged individuals. A business can get state or federal certification through OMWBE. Most people call these certifications by their acronyms (MBE, WBE, MWBE, CBE, SEDBE, DBE, ACDBE and SBE). To learn more about OMWBE certifications, click here.

Should I apply for OMWBE certification for my business?

We think so and with that in mind, we recently released two new short videos interviewing business owners on how they were certified, what they have used certification for and what being an OMWBE certified business means to them. Don’t miss a chance to be inspired by these heartwarming stories.

Certification Serves a Community

Certification to Grow and Thrive

How would I use OMWBE certification?

There are three primary ways business owners use certifications.

  • To be eligible to participate as a DBE, ACDBE or SBE on federally funded projects. This helps increase visibility and prime contractors can count certified businesses towards their goals on projects.
  • For marketing and increased visibility to city, county and state government, colleges and private-sector companies that have supplier diversity goals. For example, the Governor’s Office has set aspirational goals and state agencies look for state certifications.
  • To qualify for other small business assistance programs such as the Linked Deposit Loan Program.

There are other reasons too. Business owners may get their businesses certified to show pride in their community or for local community recognition.

How do I start?

We just released a short video showing how to complete an OMWBE online application. After you view the video, click to learn more and start your application.

What is the difference between certification and self-identification?

OMWBE certification means that how a business is owned and controlled has been verified by our state agency. OMWBE is the sole agency that does state and federal certifications in Washington State.

Self-identification is when a business registers as a vendor in an online system and the owner checks a box to show that they are minority or woman owned. This may or may not be verified.

So which one is better? It all depends on what your business does and whom you do business with. Some government agencies and prime contractors don’t or can’t recognize self-identification.

 

Kathryn Akeah works in Communications for the Washington State Office of Minority & Women’s Business Enterprises. She is passionate about equity and excited that here she can combine her MBA with her experience in community health and community organizing to support diverse small businesses across the state. Stop by the OMWBE table to get more info on certifications during the resource fair from 10 a.m. to 1 p.m. in Building I. 

Build More Convincing Business Plans with Free Market Research from Google

By: Robbin Block, SCORE Mentor & Creative Marketing Strategist at Blockbeta Marketing

“Proving” your business model to investors relies on being able to back up your assumptions about your market. Data about how people search or discover products brings you one step closer to making your case. Now imagine if you could get that information easily, quickly and at no cost — and create good looking charts and graphs to use in business plans, presentations and on social media.

Going straight to a search engine for market research is like looking for a needle in a haystack. Imagine you’re creating a new line of products for pets, a highly competitive industry. A search for “pet products” yielded 3.5 billion results (yes, that’s a “b”).

Google makes it so much easier with a range of tools designed to mine their own mega-pile of information to understand what people are doing online. What better way for you to learn about your potential customers, than to go right to the place so many people start their buyer journey?

Three Market Research Resources in One 

PEWInternet is one of my go-to’s for robust and free market research for learning about online behavior, with a section devoted to “Internet and Technology.” Combined with Google’s Consumer Barometer, you’ll get an even clearer picture about how people use the Internet to discover and purchase products and services.

Consumer Barometer includes Trended Data, Audience Stories, Curated Insights and Graph Builder — saving the best for last.

Trended Data

Trended Data compares Internet usage over time.

Let’s say you were wondering how many in your target audience used their smartphone to access the Internet, filtering by country and demographics. Here’s the result of a search for US aged 25-34 vs. US aged 45-54:

While there are differences as of 2017, it becomes pretty clear that everything is pointing in a mobile direction with smartphone and Internet usage becoming ubiquitous across age groups very soon, if it hasn’t already. This is useful, whether you’re creating a mobile app or wondering how important mobile access is to your marketing strategy.

Audience Stories

With Audience Stories, Google segments Internet usage, exploring audience clusters like Brand Advocates, Digital Moms and Millennials.

For example, Google tells us the “how-to” video category is trending strongly. “1 in 10 internet users watch DIY or How-to videos in a typical session.” They go on to explain that, “23% of online videos are viewed in order to learn something new.” This means that educating customers and demonstrating your expertise can help you gain exposure, ultimately being a way to drive more traffic to your website.

When you’re wondering about a good length for your video, Google provides the answer, “How-to Video Viewers are also open to longer videos (5-10 minutes). As many as 75% of How-to Video users watched online videos longer than 5 minutes in the prior week, compared to just 60% among other users.”

Of course Google is in a great position to know what works and what doesn’t, since they own YouTube.

Curated Insights

With Curated Insights, Google displays its own research in charts and graphs, going into depth about shopper buying and media behavior. It can be parsed by country, but there’s demographic data presented as well. Here are some particularly interesting insights:

 

Graph Builder

The tools we’ve looked at give you Google’s point of view, but with Graph Builder, you can create your own graphs and charts based on their data. There’s a simple 6-step walk through to show you how to use it, which starts with selecting questions like these:

  • The Online and Multiscreen World —“How do people watch TV?”
  • The Smart Shopper —“How did people first hear about the product/offer they bought?”
  • The Smart Viewer — “What motivated people to watch their most recent online video session?”

Once you figure out which questions are most relevant to your research, you can drill down further by:

  • Country
  • Demographic
  • Internet Usage
  • Device Usage
  • Product Purchased
  • Most Recent Video Context

From there, you can investigate by a particular product category. You’d want to, because not every business is the same, and you’ll want data specific to your industry. Granted, the categories are pretty general, but selecting something even close can provide direction.

Unfortunately, it’s not particularly useful for my “pet products” example, since there’s no category for it — weird, not to offer information about such a huge industry. Oh well, even Google isn’t perfect. Stay tuned — their tools are always changing.

Another drawback is that product filters vary by the question being answered. It would be nice if you could choose your product category first, then apply the questions to it.

Moving on, let’s say you wanted to know if you should spend time using social media to promote hair care products to US consumers. Go to: Smart Shopper>Research Behavior>Online Information Sources, and then use the “product filter” link to select hair care under “most recent product purchased.”

Now, let’s say you’re thinking of offering a discount to encourage people to make a purchase. Here’s a relative comparison of how a discount influences a purchase by category. Go to: Smart Shopper>Research Behavior>Motivation for Purchase. Filter by product, as described previously. Then, you’ll need to hide all the other motivations to create this graph.

Unfortunately, there’s no information about services or B2B “business to business.” However, the tool allows you can compare filtered segments in one chart by selecting more than one at a time.

Now Put Your Information to Good Use

This is just a taste of what you can do with Graph Builder. Once you’ve created the charts you want, you can export as a CSV or png, or share, by selecting the 3 vertical dots in the upper right corner of the graphic. That sharing option may be especially useful for creating a post to a social network.

No matter what product or service you plan to offer, the marketing of that product should be based on a good understanding of the industry and consumer behavior — and the Internet is a good place to start if you know where to look. These free market research tools are a good start, providing valuable insights you may not be able to find elsewhere. Plus, they can help you create and share some compelling graphics, whether that’s for a business plan, presentation or social media marketing.

Visit our website to learn more market research shortcuts.

Robbin’s unique perspective and extensive experience has been put to good use solving her client’s stickiest marketing problems. Not to be missed, she’s presenting Slay the Social Media Dragon and Do It Yourself Websites at this year’s BizFair.

 

He Said v. She Said

By: Stacey L. Romberg, Attorney at Law

Sally recently left her 9-5 corporate job, and enthusiastically began a new event planning business. Sally’s friend, Larry, wanted to be one of her first clients. Larry wanted to hire Sally’s business to plan his wife Judy’s 50th birthday party. Sally found an event planning contract on the internet, and tweaked some of the language. The contract set forth that Judy’s birthday party would be held at the Gigantic Golf Club, with cocktails and dinner for 100 guests. Larry would pay Sally’s business $5,000 for event planning services, to be paid no later than ten days after the party concluded. Sally is thrilled to work with her friend, and to plan her first big event.

Larry and Sally signed the contract, and Sally then contacted Gigantic Golf Club to reserve the space. Gigantic Golf Club informed Sally that it required an advance deposit of $8,000.00 to lock in the reservation. Sally contacted Larry by email: “Hi Larry. I’ve reached out to Gigantic Golf Club, and they need an $8,000.00 deposit. Can you please send me a check for that amount, made out to Gigantic Golf Club? Then I can forward it over to them to secure the space. Thanks!” Larry responded: “Hi Sally. Our contract says I am supposed to pay for everything ten days after the party has concluded. I’d appreciate it if you could please pay the deposit, and then put it on my bill. Thanks.”

Sally is shocked when she receives Larry’s email. She reviewed the contract. The contract stated:  “Larry is responsible for all costs related to the Event.” It also stated: “Upon conclusion of the Event, Sally will submit an invoice to Larry which will be due no later than ten days after the date of the Event.” The contract is silent as to whether Larry’s responsibility for the event’s costs meant that the costs will be paid up front by Larry, or whether Sally was required to initially incur the costs and then invoice Larry for those amounts. Sally doesn’t recall that they ever discussed this issue. Since Sally knew Larry personally, Sally wasn’t worried about getting paid and didn’t pay a lot of attention to the specifics of the contract.

Sally tentatively responded to Larry’s email: “Hi Larry. I’m so sorry for the confusion. Our contract doesn’t seem to address the issue of whether the costs will be paid up front. I’m afraid I cannot afford to incur an $8,000 fee, since I just started my business. Could you please pay it? Thank you for understanding!” Larry responded to this email within five minutes: “You have got to be kidding me! Don’t you remember that we talked about this? I told you that my son Charlie’s private school tuition is due shortly, and I’m tapped out. I won’t be able to make any payments until after the party. You better pay that deposit right away, because it’s too late at this point for me to fire you and hire a new event planner. If you don’t do right by me here, I’m going to go on Yelp and write the most scathing review possible!”

These types of situations, unfortunately, occur much more often than most business owners realize. A well written contract is the key to avoiding these types of “he said versus she said” disputes. Business owners need to routinely use thorough, well-drafted contracts that are prepared by an attorney. Here are seven tips for working effectively with your business attorney to develop a great contract:

#1: Explain any pertinent background information regarding how your industry works, and also set forth your goals for the agreement.

#2: Communicate your main concerns to your attorney about the proposed transaction (getting paid, receiving poor work quality, handling disputes, etc.).

#3: Provide a written outline to your attorney identifying the parties and principal terms of the deal.

#4: Think through how you’d like the contract negotiation process to proceed. Do you want to work through counsel exclusively? Or do the parties want to negotiate directly, and then go back to their attorneys with questions and revisions?

#5: Discuss the timing of the work.

#6: Understand the attorneys’ fees, and how you will be billed for the work performed.

#7: Be mindful of attorneys’ fees while negotiating contract terms. Some issues may be so minor that it’s not worth the attorneys’ fees to argue about it.

If there is a disagreement about the terms of a contract, rather than continuing an email or telephone “war” with the other party, here are some recommended first steps:

#1: Review the Contract Requirements Related to the Issue in Controversy: What does the contract say about the issue being disputed?  Are you sure you are right and the other party is wrong?

#2: Review the Contract Requirements Related to Dispute Resolution:  The contract may tell you how you have to proceed in resolving the dispute. Mediation? Arbitration? Litigation?

#3: Make an Initial Attempt to Calculate your Damages: Litigation is very expensive. In order to decide whether it’s worth it to pursue litigation, you need to know the monetary value of your loss.

#4: Call Your Attorney: Let your lawyer know your preliminary thoughts based on your initial legwork, and then discuss the situation and your options.

Stacey L. Romberg, Attorney at Law, focuses her practice on business law, estate planning and probate. For more information, please visit the firm’s website at www.staceyromberg.com.

Attend Stacey Romberg’s Biz Fair class “Business Law Essentials” at the 22nd annual Biz Fair on Saturday, September 29 at Renton Technical College, RSVP today: bizfair2018.eventbrite.com

Find the Missing Link in Your Social Media Strategy

By: Robbin Block, Blockbeta Marketing

An effective social media strategy depends on finding the right sites to reach your audience. Beyond the major social networks, which attract a large, generalized audience, there are plenty of niche sites which will help you build exposure and website traffic.

Benefits of Niche Sites

  • More targeted: Relevance trumps size
  • Buyers, not browsers: Leads to more qualified, convertible traffic
  • Big fish, smaller pond: Less clutter and noise, more chance to get noticed
  • More meaningful sharing and engagement

Be Where They Are

The point of using social media for business is to get in front of potential customers, which means you want to be where they are hanging out. Whether you choose major or niche sites, define your audience using the following and then match it to the sites that meet your criteria:

Geography: Neighborhood, city, regional, national, international.

Interest: Consider the site’s focus: i.e., design, games, business, etc. Drill down as much as possible to match your target audience.

Demographic: Easily identifiable stuff about participants, like age, income, education. For data about social sites, start your research at PEWInternet.org. For small sites, you may have to find out from the site itself. Look for advertising information in the footer (just for info, not to advertise).

Activity: What people do at the site, i.e., simply commenting vs. watching videos. Think about the kind of content that fits with what your business is about, i.e., if you have a visual business, Instagram and Pinterest may be a good fit.

Affinity: What participants have in common, i.e., people planning a wedding or those that like to invent things with Legos.

Many people participate in both major and niche sites, so select a balance of each. If you choose a major, join subgroups that match your audience, ie., a food related business in Seattle could join the Seattle Foodies group on Facebook.

Where to Find Niche Sites

The more sites seek to create interactivity and engagement, the more they’re likely to offer social opportunities to participate in. Start with the associations and groups your audience belongs to (ask them), then look for social opportunities in the following places:

  • Search Google like a customer looking for a product like yours and see what social sites come up.
  • Industry Associations
  • Online Publications
  • Social site directories
  • Check competitors’ sites for their social badges
  • Look at your own referral traffic data
  • Vendors sometimes have their own social networks too
  • Search Google for “niche social sites” + your area of interest
  • Go local (websites, blogs, publications, etc. in your geographic area)

Don’t Spread Yourself Too Thin

Once you’ve narrowed down your list of niche sites, finding the best match you can, prioritize them by highest amount of traffic. Then, start using them and track the referral traffic to your site, using something like Google Analytics to see if all that effort is paying off.

Learn more about social media marketing.

Robbin is presenting “Slay the Social Media Dragon” at this year’s Bizfair.

Your Fortune Is In The Follow Up

By: Debbie Page

We’ve all heard the phrase, “Your fortune is in the follow up,” which is then immediately followed by,

“Yeah but I don’t want to be sales-y.” Brace yourself friends, I need to tell you something straight and it might sting.

Get over yourself.

One of my great business colleagues says, “Sales is an act of love,” and if you are passionate about what you do and know that it provides great value to your ideal client then it is your obligation to follow up.

Research shows that 80% of sales are made after the 5th follow up. How many times do you follow up? Once? Twice? You are losing money if you do not have a documented and repeatable system to follow up 5 times or more, with people who have expressed interest in your products/services.

You also need to have more in your follow up than, “Are you ready to buy?” This is where the documented follow up system fits in.

Here are 5 steps to include in your sales follow up process:

  1. It’s totally appropriate to make your first follow up about checking in to see if the prospect has any questions or is ready to move ahead.
  2. The second time you follow up reference what they mention they need to attend to before they start working with you.
  3. The third time share something they might find valuable as it relates to their business, an article a blog post (written by you is fine or by someone else)  or a tool that you think they or their clients might find useful.
  4. The fourth time, send them a handwritten note with a $5 coffee card inside and a note that says, “I know you have been working hard, take a break today – coffee is on me.
  5. The fifth time call them. Yes, I said call them. No need to schedule an appointment. Just pick up the phone and give them a ring. “Hi Jack, Liz Lemon here. I was just thinking of you and ratings season and wanted to wish you the best. Let me know if there is anything I can do to help you get that Emmy this year.”

Any of this seem sales-y? Not at all.

Keeping yourself top of mind will keep you in line when your ideal customer is ready to invest with you.

Create a documented sales follow up system and plan that you and everyone on your team follows EVERY time a prospect enters into conversation with you. Having a documented plan that is executed can increase your revenue by 50% or more.

What would an additional 50% in revenue do for you and your business? 

Learn more marketing tips from Debbie at Biz Fair on September 30.

3 Ways the Public Library Helps Entrepreneurs

By: The Seattle Public Library

Whether you are exploring a new business idea or are trying to grow an existing small business, your public library can be an important ally in helping you create a viable plan. The Seattle Public Library (SPL), King County Library System (KCLS), and Pierce County Library System (PCLS) offer access to an extensive selection of free resources for entrepreneurs at any stage.

Here are three great ways you can take advantage of your public library:

1: Conduct Market and Industry Research

Business databases accessible through your library’s website can help you locate valuable research and data that is not available on the open web. With your library card, you can access these tools 24/7 without having to visit the library. You’ll find:

Information about other companies:
Enhanced business directories will help you identify competitors, prospects, suppliers or partners, and they are searchable by type of business and geography. These directories also include detailed information for private companies that can be difficult to find elsewhere, like estimates on revenue and number of employees. Look for: ReferenceUSA (SPL, KCLS) and Mergent Intellect (PCLS, KCLS)

Information about consumers:
Demographics databases are useful for choosing a business location, locating target customers, and sizing your market. These tools go beyond basic census data and dive deeper into consumer spending and psychographics. Look for: DemographicsNow (SPL, PCLS) and Social Explorer (KCLS)

Information about your industry:
Industry reports available through business databases will include your industry’s trends, opportunities, challenges, regional highlights, financial benchmarks, and more. Look for: ABI/Inform Trade and Industry (SPL, KCLS) and Business Source Complete (PCLS)

2: Build Your Technology and Business Skills

Web classes:
Brush up on business and tech skills with online courses you can take at home, at any time, and on your own schedule. Classes range from beginner to advanced level, and include a wide range of courses like social media marketing and Microsoft Access. Look for: lynda.com (SPL, PCLS, KCLS), Microsoft Imagine Academy (all libraries)

Books & eBooks:
Library collections include up-to-date guides on starting a business, writing a business plan, marketing, business tech skills, and more – available in print or as eBooks. Look for: Safari Tech Books (SPL) for its vast collection of up-to-date tech and business eBooks that are always available.

Library events:
Attend free library workshops and events to get expert advice and ask your own questions on topics like marketing, operations, funding, opening a food business, and more. Meet representatives of local agencies at library-hosted open houses. Check your library’s calendar to find out what’s happening soon!

3: Get Research Help

Locating the best business resources for your needs and then learning how to use them can be time consuming and frustrating. Librarians are available to make this process a little less painful! All libraries can help in person, over the phone, and by email; Seattle Public Library also offers one-on-one business research appointments.

Find The Seattle Public Library and Pierce County Library System at the Biz Fair to learn more!

Tips for Success in Choosing a Business Structure

By: Stacey Romberg, Attorney at Law. www.staceyromberg.com

Choosing a business structure can be a daunting task! I recommend that entrepreneurs, in making their selection, analyze the following four factors:

Evaluate Your Risk

Does your business idea involve some risk of liability? If so, in what sense? And how much risk? For example, do you want to lead rock climbing excursions? Or to provide a more common example, suppose you want to operate a cross training gym? The risks involved in these types of businesses are clear – the participants may be injured. On another note, suppose you are a wedding photographer? You could be on the hook if the photos don’t turn out well and the bride and groom become angry and litigious. Generally speaking, if your business involves a great deal of potential risk, a business entity such as a corporation or a limited liability company (LLC) may prove helpful in shielding you from individual liability.

Evaluate Your Business Relationships

Breaking up is hard to do! Most couples, when they get married, incorrectly assume that their relationship will last forever so no prenuptial agreement is necessary. Similarly, many business owners assume they will always be able to work together well so there’s no need to spend money on legal fees to develop a corporate Shareholders Agreement or LLC Operating Agreement. These agreements govern the relationship between business owners, and can spell out what will happen if business owners are deadlocked or how a business owner may exit out of the business. A breakup of a business relationship can resemble the dissolution of a marriage, with all the accompanying drama, stress, and expense. If you are going into business with another person, enter into that relationship with caution and a solid legal agreement in place.

Confer with Your Certified Public Accountant (CPA)

Be sure, as you consider what business structure to form, to consult with your CPA about the tax implications of the various business structures. It’s important that you understand all the financial facts regarding your potential tax liabilities before making a decision.

Confer with Your Business Attorney

A business attorney should form any business entity other than a sole proprietorship. If your business is not formed properly, you may be disappointed to discover that, in the event of litigation, the business entity fails to shield you from personal liability because the structural documents are insufficient, inappropriate, or not being consistently followed.

Stacey L. Romberg, Attorney at Law. www.staceyromberg.com This post is for informational purposes and does not contain or convey legal advice. The information herein should not be used or relied upon in regard to any particular facts or circumstances without first consulting with an attorney.

Small Business Bookkeeping

By: Jim McClaflin, Director at Washington State Society of Enrolled Agents (WSSEA)

What we see in the tax business are small businesses that are running a profitable business but their bookkeeping processes don’t hold up under an IRS audit. When you have difficulties proving your income and expenses to the IRS you then have to in essence recreate the business’ books properly. This is expensive for the owner(s) as this type of bookkeeping comes at a premium cost. Audits are normally done years after the tax return is filed and it is difficult to remember all the details of your business transactions, which could result in unallowed deductions or additions to business income.

Here are a couple of common stumbling areas for small business bookkeeping that we frequently see:

  • Combining personal and business accounts. There is nothing illegal about doing this, but it greatly complicates an audit and brings your personal accounts into the audit process. If you sell a personal car on Craigslist and that income goes into your personal account which is included in the audit, then you have to prove that the sale of your personal car was not business income. In an audit the IRS will go through every single deposit and you have to show that it was not business income. Personal expenses paid out of your business account can be identified as an owner’s draw, however an excessive amount of personal expenses will cause the auditor to question if some of the business expenses are in fact personal in nature and not deductible. For LLCs and Corporations this starts to breakdown the legal distinction between the person and the company.
  • Not keeping invoices or receipts. Several businesses use their credit card statements that show where the purchase was made as their method of proof of a business expense. This is not a fool proof plan. In a Washington State audit if you have made a purchase over the internet the credit card statement will not show if you paid sales tax. In an audit if you can’t prove via an invoice that you paid the sales tax, then you will be required to pay use tax (the same rate as sales tax). Since I run a tax business a purchase from Staples would logically be a business expense and accepted in an audit, however a purchase from Lowes would be questioned and I’d likely need to show an receipt proving that what I purchased was needed for the business. The best plan it to scan in all your receipts and write any notes about the purchase on the receipt or invoice.
  • Not using a professional bookkeeper.  Bookkeeping seems pretty easy to do, until it isn’t. A professional bookkeeper is a cost effective method of keeping your business records straight. At the very least have a professional set up your books and show you how to make the entries correctly. Going back to fix the books is incredibly frustrating and time consuming for a business owner. A professional will also bring other accounting/tax knowledge to your team besides just the books themselves.

Learn more at: http://wssea.org