Micro Business Basics - Powerpoint Training Slides
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Transcript Micro Business Basics - Powerpoint Training Slides
Welcome to
Micro
BUSINESS
a
Build a solid foundation
© 2011
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Micro Business Basics
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A joint financial education project of
Consumer Action and Capital One.
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Topics we will cover:
What a micro business is.
How to anticipate the needs of
a new business.
Business planning and
bookkeeping.
Different ways that businesses
are organized.
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Your expectations
What do you hope to get out of
this seminar?
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Micro businesses
Micro businesses are very small
companies run by their owners
with few or no employees.
They are often home-based, with
annual sales under $250,000.
Many micro businesses start with
a hobby or a great idea.
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Growing micro businesses
Micro businesses can qualify
for loans to help them grow into
large regional, national or
franchise businesses.
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Failure rate
The U.S. Small Business
Administration says that more
than half of small businesses fail
in their first year.
Many businesses fail because
they lack adequate funding.
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Ready for business?
Some people are better off as
employees rather than as
business owners.
What issues do you think people
who are thinking about starting a
business must consider?
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A good businessperson has...
Discipline
Experience
Patience
People skills
Aptitude with numbers
• Can you think of other attributes
you need to excel in business?
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Anticipating business needs
Sound financial planning is key to a
successful business
Try to predict what it will cost to run
your company
Prepare a budget that closely reflects
your business plan*
*A written document that outlines your
business idea and the steps you will
take to make the venture succeed
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Business resources
SCORE, 800-634-0245
www.score.org
SBA, 800-827-5722
www.sba.gov
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Business vs. personal funds
Co-mingling personal and
business transactions makes it
hard to track business activity
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Business credit cards
Manage cash flow
Keep your business obligations
separate from your personal
obligations
Earn discounts on supplies,
rental cars and other services
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Planning and bookkeeping
Keeping accurate, organized
records is vital to the success of
your business.
A lost receipt is a lost deduction
Lost deductions mean you pay
more money in taxes.
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Business plan
One of the first documents you
need to prepare
A business plan will help you
focus your vision for your
business
You can use your business plan to
approach lenders and potential
partners
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In a business plan
Your business purpose
Products or services
The company’s structure (sole
proprietorship, partnership or
limited liability company, for
instance)
Short bios of key personnel
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Help in writing your plan
Community groups
SCORE
SBA
Free templates online
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Business bookkeeping
Monitor your profits and losses
Know the value of your business
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Start up costs
Many fast-growing companies are
started with the founder’s personal
savings, in some cases no more
than $10,000.
Start-up funding should cover
operating expenses for at least one
year.
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Typical start-up costs
Salary needs
Initial costs
Direct costs
Overhead
Recurring costs
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Topics for the next session
Business structure
Finding funds for your business
SBA Loans
Reading a projected profit and
loss statement
Government requirements
Micro business mistakes
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Welcome to Session Two
We will cover:
•
Business structure and organization
•
Finding funds for your business
•
SBA Loans
•
Reading a projected profit and loss
statement
•
Government requirements
•
Top five micro business mistakes
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Structure/organization
Businesses can be established
legally in different ways
This is known as its business
structure or organization
No one legal structure is best for
all micro businesses
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Sole proprietorships and
partnerships
Sole proprietorships are oneperson businesses
Partnerships are businesses
formed by two or more
owners
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Corporations
A corporation is a legal entity,
organized under state or federal
laws
It is legally separate from the
people who own it
Corporation owners are usually
protected from personal liability
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Limited liability companies
Known as LLCs
Combines features of sole
proprietorships, partnerships and
corporations
LLCs can help business owners
protect their personal assets
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Finding funding
Use your own money
Find a partner or investor with
cash to invest
Borrow funds
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Credit
A business loan or business line
of credit can help you meet your
business needs
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Business credit cards
Business credit cards can help:
• Manage your cash flow
• Keep your business and personal
obligations separate
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SBA Loans
The Small Business
Administration (SBA) can help you
prepare loan documents
It also guarantees loans
You pay for these services
through fees when your loan is
approved
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SBA sponsored lending
Loan guaranty programs
Building and renovation loans
Loan pre-approval services
Start-up financing and technical
assistance for start-ups, newly
established micro businesses and
growing micro businesses
Federal contracting assistance
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SBA streamlines lending
Lower down payments
Longer terms
Lower interest rates
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Steps to an SBA loan
Ask the SBA for a list of banks in your area
Compare choices by contacting SBA
lending officers at a few of the banks
Decide where you will apply
Compile the financial and business records
required by the bank
The bank will submit your loan to the SBA
for approval
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Government contracting
There are many opportunities for
small business and minorityowned businesses to provide
goods and services to the
government.
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Class activity
Sample Projected Profit and
Loss Statement
Take out the sample Projected
Profit and Loss Statement
worksheet
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Local and state requirements
Business licenses
Building permits
Health/occupational rules
Sales/income tax
Employee withholding
Workers’ compensation insurance
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Federal requirements
Verify your employees’ right to work in
the U.S.
Withhold federal income taxes
Minimum wage, overtime and child
labor laws
Make estimated income tax payments
Social Security and Medicare
payments
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Micro business mistakes
Inadequate planning
Failure to discipline yourself
financially
Insufficient cash reserves to
sustain growth
Poor record-keeping
Excessive debt
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Questions and answers
We have reserved some time
to answer your questions.
Please raise your hand if you
have a question.
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Congratulations!
You have completed the
MoneyWI$E seminar on Micro
Business Basics
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Your feedback
Please fill out the Seminar
Evaluation Form and leave it on
your way out.
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Visit money-wise.org
for additional information and to access
free financial education materials
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