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Web.com Small Business Tip of the Day: Why You Need a Privacy Policy

April 30th, 2013 ::

If you collect any kind of information about your customers online, you need a privacy policy. A privacy policy lets customers know exactly what information is tracked and tabulated and how it will be used. According to the U.S. Federal Trade Commission’s Fair Information Practice Principles, you must meet the principles of privacy protection by providing the following information in your policy: 1) Who is collecting the data; 2) The uses to which the data will be put; 3) Recipients of the data; 4) A description of what and how the data is collected; 5) Whether the requested data is voluntary or required, and what if the user refuses to comply; and 6) What steps are being taken to ensure the confidentiality, integrity and quality of the data.

Small Business Optimism Slips

April 9th, 2013 ::

By Karen Axelton

Beginning to see the glass as half empty, small business owners are more worried about a recession than they were a few years ago, the 2013 Small Business Economic Forecast from Pepperdine University’s Graziadio School of Business and Management reports. Conducted in partnership with Dun & Bradstreet Credibility Corp., the annual study of more than 2,700 small business owners found that more than one-third (36.2 percent) of small business owners fear a recession this year. That’s substantially up from the 28.4 percent who were worried about a recession in 2011.

In addition, small business owners are less optimistic about growth prospects than last year. In early 2012, 54 percent said they were more or somewhat more confident than they were in 2011. By contrast, in early 2013, just 45 percent reported feeling more or somewhat more confident about their business’s growth prospects for the coming year.

“Small business owners, who are optimistic by nature, are still taking a highly cautious view of the economy and their personal business prospects,” said associate professor of finance Dr. John Paglia, founding director of the Pepperdine Private Capital Markets Project. “The ‘foxhole mentality’ among small business owners to dig in and stay low has the potential to slow the still fragile recovery.”

What’s holding small business owners back from growth? Four in 10 say government regulations–specifically, taxes and healthcare–are the biggest impediment to overall growth in the GDP, compared to 32 percent who said so in 2012. Four in ten (42 percent) of respondents also believe the Affordable Care Act will make their companies’ healthcare costs rise; as a result, 33 percent plan to make changes to their coverage that will negatively affect employees.

Probably because they’re feeling cautious, fewer small business owners are planning to give their staff raises (39 percent) than were planning to do so in early 2012 (41 percent). This is despite the fact that employees’ take-home salaries have been hurt by the end of the payroll tax cut in early 2013. Of course, it could also be because small business owners themselves aren’t seeing any increase in pay—61 percent say they are not making more than the year before.

Two bright spots on the horizon are the housing market, with small business owners overall feeling that housing prices will rise 3 percent this year, and unemployment, with small business owners predicting that the national unemployment rate will decline to 8 percent.

You can view the full 2013 Small Business Economic Forecast at http://bschool.pepperdine.edu/accesscapital.

Image by Flickr user Cali4Beach (Creative Commons)

Web.com Small Business Toolkit: Small Biz Reg Watch (Government Regulations)

February 21st, 2013 ::

Small Biz Reg Watch

Keeping up on government regulations affecting small business can be overwhelming for any business owner. In addition, it’s important to know what new regulations are being considered so you can make your voice heard. The House Committee on Small Business has created Small Biz Reg Watch, a website to help business owners stay informed about regulatory proposals that are open for comment and that may have a significant economic impact on small businesses. The Committee wants business owners to get involved by letting the government know how its proposals will impact them. The page lists current proposals and their impact on small business and provides a place to post your comment.

 

9 Employment Trends You Need to Know About for 2013

January 18th, 2013 ::

By Rieva Lesonsky

What does 2013 hold in store for your employees and your business? According to the 2013 Workforce/Workplace Forecast from The Herman Group, 2013 will look much like 2012, with most employers adopting a “wait-and-see” approach to hiring and U.S. unemployment remaining above 7 percent for the year.

Here are 9 other trends you need to know about:

  1. Recruiting will intensify in many industries. Both big and small companies, especially in the IT sector, will feel pressure to hire due to burned-out, overworked staff. The bad news for small employers is that with big companies (with bigger benefits) hiring too, competition will be fierce.
  2. Trained, experienced workers will be in short supply in many fields. Consider promoting from within and providing your entry-level employees with the training they need to move into higher positions. Also develop relationships with local schools, colleges and universities to give you a pipeline to educated workers.
  3. Communities will become more aware of the lack of skilled employees, and smart local leadership will invest money and effort into developing the local workforce for the careers of tomorrow.
  4. Gamification will be used in training, performance evaluations and as a bonding tool to make work more fun and build relationships. It’s an especially important tool for companies seeking to engage their Millennial employees.
  5. Companies will use social networking to recruit new employees and to train and develop those they have. Don’t forget the internal social networks that even small companies have: If you’re looking to hire, try looking for referrals from your existing team.
  6. Companies will keep trying to do more with less—cutting staff and hiring independent contractors to squeeze still more productivity and profit out of their teams. There’s a right way and wrong way to re-engineer, Herman Group notes. Try to do it without cutting staff.
  7. “Job churn” will grow as too many employers continue to ignore what’s needed to create a happy, engaged work force. “There is a tremendous pent-up energy for job-hopping, which many employees have been putting off for years,” Herman Group warns. Ignore it at your peril.
  8. A second Obama Administration will likely mean greater regulation. You’d be smart to have access to an attorney with HR expertise, just in case. Herman Group believes that the Affordable Care Act may spur small and midsized employers to move from providing health insurance to taking part in “insurance exchanges” and funding their employees’ purchase of coverage there.
  9. Last, but not least, your small business might see more competition in 2013: Herman Group believes more unemployed people will take advantage of the growth in independent contracting by starting their own businesses (or at least becoming freelancers) to supply the services that businesses need.

Image by Flickr user brian Dhawkins (Creative Commons)

 

 

6 Legal Tips to Start Your New Year Out Right

January 14th, 2013 ::

By Rieva Lesonsky

Want to make 2013 a year of unprecedented growth for your business? I asked the experts at online legal service RocketLawyer for their best tips.

1      Properly incorporate. The No. 1 legal mistake made by small businesses is the failure to incorporate. When you incorporate your business, you create a legal entity separate from yourself that conducts business, generates income, and assumes tax and legal liabilities. By creating a “corporate veil,” incorporation legally shields your personal assets in the event that your business faces a lawsuit. Online legal services offer free incorporations (you pay only the state fees!) and cost-effective monthly legal plans for small businesses. Plus, you can get legal advice from real attorneys and documents ranging from hiring agreements to contracts.

2      Start the New Year on the “write” foot. According to a recent Rocket Lawyer survey, one in four businesses have had trouble collecting payments from their customers; and of those businesses, 60 percent have written off bad debt. To ensure payment, always create a contract that clarifies what work will be done, for what pay, and the billing procedure before beginning the work. Creating a contract is essential to ensure on-time payment and puts you and your client on the same page.

3      Let it grow, let it grow, let it grow. Expand your presence online by monitoring information on business-focused websites such as Google +, Yelp and Manta.  If your online presence on such sites is not maintained internally, your company may be buzzing in places whether you’ve created a profile or not. Claim your company profile and help it attract more traffic by adding your logo, product and service offerings, social feeds and more.

4      Cultivate peace of mind.  Create a Buy-Sell Agreement, commonly referred to as a “Business Will.”  This document details what happens should one party leave the business, either through active means (alive) or circumstance (death).

5      Protect what’s earned and what’s given. Intellectual property is a legal fortress that protects your valuable assets and defends against your competitors.  Do yourself a favor and know the advantages of, and the differences between, trade secrets, trademarks, copyrights and patents.

  • Trade secrets are the most common form of intellectual property, offer a perpetual monopoly, will not expire like a patent and can be protected through simple non-compete and non-disclosure contracts with your employees.
  • Trademarks protect your logo, brand and business name from unfair use.
  • Copyrights protect other original content.
  • Patents, give you the rights to your invention: a useful and actual process, machine, manufacture, or composition of matter.

Since you’ve already done all the hard work, make it count!

6       Always keep good counsel. Good legal advice is a competitive advantage and can be the difference between success and failure, so it’s really important to have an attorney to keep you on the right path. There are a lot of things you can do yourself, but an attorney can help you strategize, plan for growth and answer the questions you didn’t even know to ask. In the event of an unfortunate or unforeseen incident, your attorney will be there to help protect you and your business.  Remember, it’s better to pay a little up front than a lot down the road.

Image by Flickr user Steve Snodgrass (Creative Commons)

How to Be a Good Interviewer

January 3rd, 2013 ::

By Karen Axelton

Do your New Year’s plans for your business including hiring new employees? Then you’ll want to make sure you get the perfect person for the job. One of the most important parts of choosing a new employee is conducting a good job interview that gives you all the information you need to make a decision. But many small business owners aren’t sure how to do a thorough interview. Here are some tips to help you.

Be prepared. Before the interview, review the candidate’s resume and job application. Also create a list of questions that you ask all candidates. This not only helps ensure you don’t forget anything important, but also means you’re judging employees from a level playing field by asking everyone the same things.

Focus. Don’t check your email, answer your phone or look at your computer during the interview. Not only is it rude, but you’ll also get distracted. You only have a short time to talk to this person before deciding you want to make them part of your business; shouldn’t you be paying attention?

Ask open-ended questions. Instead of questions that can be answered with “yes” or “no,” ask questions that require an explanation or call on the candidate to elaborate. You’ll get a better sense of the person’s personality that way, as well as fuller descriptions of his or her experience.

Know what you can and can’t ask. To avoid getting in trouble for discriminatory hiring, in general, you should stay away from questions regarding an interviewee’s age, marital or parental status, religion, race, disability or legal immigrant status. (This Nolo.com article provides more information and resources on hiring questions.)

Make it a team effort. If you get nervous during interviews, to the point where you find it hard to focus, consider having a partner or key employee conduct the interview with you. You can take notes and observe the candidate, while your partner can do most of the talking. This tactic has the added benefit of giving you someone else’s perspective on the candidate.

Write it down. Take notes on the candidate’s answers to help you remember what was said, especially if you’re interviewing several people in a row. After each interview, spend 5 minutes or so jotting down the relevant information, including your first impression of the person.

Follow up. Let the candidate know when he or she can expect to hear from you regarding the job—and be sure to follow up when you say you will. There’s nothing worse for a candidate than waiting in limbo to hear about a job offer. What’s more, if you’re not professional about how you handle this, it could affect your business’s reputation on social media.

Image by Flickr user Marco Bellucci (Creative Commons)

 

Have You Thought About Your Succession Plan?

December 4th, 2012 ::

By Karen Axelton

Do you own a family business? Do you have a business partner (or more than one partner)? Do you hope to sell your business and retire on the proceeds one day so you can spend your time playing golf? If the answer to any of these questions is “Yes,” then you need to be thinking about a business succession plan.

A succession plan lays out how your business will run if you should leave the company, sell the company, die or be incapacitated. Much like writing a will, creating a succession plan is something many business owners put off because they don’t want to think about it. But much like failing to write a will, failing to draft a succession plan could destroy your business if unforeseen incidents occur.

Begin your successon planning by thinking about who you would like to have in charge if you’re no longer in the business. This might be your business partner/s, your spouse or a child who works in the business (or even one who doesn’t). If the person you’re considering is someone who might not expect to fill this role (like your spouse), talk to him or her about the issue and whether they have any interest in filling your shoes.

Put the right legal documents in place to ease the transition. Talk to your attorney and accountant. Your form of business will affect what documents are needed. For instance, how will your shares of the business transfer to your successor? Will a buy-sell agreement be needed in case existing shareholders don’t want to work with the successor and he or she needs to buy back their shares? Just like a will, you need documentation to ensure your wishes are carried out.

Another important step in succession planning is making sure the transition is properly financed. For example, a key man life insurance policy could provide the funds for your successor to buy out partners’ shares in the event you die. Your accountant can point out financial needs that may arise and how to fund them.

Part of the financial aspect includes planning for your retirement and how you will transfer ownership and assets in the business to your successor. Again, your accountant can guide you through options such as selling the entire business, selling your shares to the successor or partners, or even selling your business to your employees.

Last, but not least, think about what would happen if illness or accident left you unable to work for a while. This could actually be an opportunity to “test drive” your succession plan by having your successor work in the business. If he or she doesn’t currently work for the company, consider having the person do so at least part time to get up to speed, or otherwise familiarizing him or her with the issues of your role.

A good succession plan will ease your worries and your family’s worries about the future of your business. (If you have a family business, it can also smooth over concerns about who will take your place.) Don’t delay in setting one up.

Image by Flickr user chispita_666 (Creative Commons)

 

 

Web.com Small Business Toolkit: startupPerColator (Document Creator)

November 30th, 2012 ::

startupPerColator

Need a legal document for your business? startupPerColator is a user-friendly, interactive website that enables entrepreneurs to generate the legal documents needed to form a Delaware “C” corporation, free of charge. Available documents include a Certificate of Incorporation, Bylaws, Action by Written Consent of the Sole Incorporator, Action by Unanimous Written Consent in Lieu of the Organizational Meeting of the Board of Directors and an Action by Written Consent of the Stockholders. To help entrepreneurs to get startup financing, startupPerColator also offers users access to a free, customizable term sheet generator that the firm developed based on National Venture Capital Association (NVCA) model documents.

 

Health Care Reform: Myths and Realities

November 27th, 2012 ::

By Maria Valdez Haubrich

While the news is full of big companies crying foul about health care reform now that President Obama has been reelected, how are small businesses reacting? The primary sentiment among small business owners is mass confusion, reports eHealth’s Fall 2012 Small Employer Benefits Survey.

The poll of small businesses and self-employed people found that 77 percent of small employers were holding off on their long-term expectations of how health care reform might impact their business. The biggest concern (held by 61 percent of small employers) was the cost to their businesses. However, 25 percent were struggling simply to understand what health care reform would mean to their companies.

eHealth took a look at the realities of health care reform and asked small business owners their beliefs and found a big disconnect. Here are some of the myths and realities.

Health Care Reality: Under the ACA, employers with fewer than 50 full-time employees are not required to buy health insurance for those employees.

Health Care Misunderstanding: Only two employers in the survey had more than 50 employees. However, one-third (34 percent) incorrectly thought they would be required to provide insurance for employees in 2014, and about the same number (35 percent) weren’t sure if they would be required to do so. Only 31 percent knew they will not be required to provide health insurance.

Health Care Reality: If you have fewer than 50 employees, you don’t face a tax penalty of any kind if you don’t provide health insurance for your employees. Employers with 51 to 199 full-time employees must pay a $2,000 tax penalty for each employee who buys health insurance through an insurance exchange. But they don’t have to pay taxes for the first 20 employees who do so.

Health Care Misunderstanding: Thirty-four percent (34 percent) of the employers in the survey thought they would be taxed if they didn’t offer health insurance in 2014, and 35 percent weren’t sure. Only 31 percent correctly said they wouldn’t be required to pay a tax for not offering insurance.

Health Care Reality: The Affordable Care Act calls for health insurance exchanges to be created in each state in 2014. Exchanges will allow employees to buy subsidized health insurance on the individual market even if they have a pre-existing medical condition. If you feel guilty about not offering insurance, this could ease your mind by making it easier for employees to get insurance on their own.

Health Care Misunderstanding: The vast majority of small business owners (78 percent) admit they aren’t familiar with health insurance exchanges or how the exchanges might affect their businesses.

Despite their uncertainties, the majority (68 percent) of respondents did not plan to stop offering health insurance to their employees. About one-third said they would consider dropping insurance, but just 3 percent said they definitely plan to do so.

Image by Flickr user twbuckner (Creative Commons)

 

Web.com Small Business Toolkit: Family and Medical Leave Act Advisor (Health Benefit Website)

November 2nd, 2012 ::

Family and Medical Leave Act Advisor

Is your business required to offer employees the Family and Medical Leave (FMLA) benefit? If so, do you know which employees are eligible for FMLA leave, what entitlements and benefits are provided under the law, and in what situations FMLA leave can be used? All of your questions can be answered at the Department of Labor’s Family and Medical Leave Advisor website. FMLA covers everything from caring for a newborn to a sick relative to some military reasons, and it’s important to know the rules so your business is always in compliance.