web analytics

Archive | Ask Score

Counselors to America’s small businesses

Establish a line of credit to manage the unexpected

A line of credit, sometimes called revolving debt, enables a company to draw against a pool of money as it needs to. That line of credit is invaluable for protecting your business from emergencies and stalled cash flow because it extends the cash available in the business checking account to the upper limit of the loan contract. Essentially, the line of credit is assurance by a bank that as long as your company is financially healthy, it can borrow money whenever it needs to.

This form of short-term borrowing is an excellent way to establish a relationship with a bank and demonstrate the creditworthiness of your business-especially if you have but don’t use the line of credit. Moreover, by virtue of having this relationship, your banker can become a sort of silent partner, giving business operation advice as well as money.

You’ll find many variables in a line of credit, such as the period of time (short or intermediate), whether it is renewable or nonrenewable, and whether it has a fixed or fluctuating rate of interest.

A short-term line of credit typically is 60 to 120 days, whereas an intermediate-term line may be as short as one year or as long as three. You’re most likely to want the line of credit to purchase inventory and to pay operating costs-not to purchase equipment or real estate.

To negotiate a credit line with your bank, prepare to hand over your current financial statements, latest tax returns, and a statement of projected cash flow.

What collateral will you use to secure your loan? You’ll need more than the assets you may be purchasing with it, such as the company’s accounts receivable, equipment, and real estate. The loan agreement and related documents will be designed to ensure that your loan payments are on time and have priority over noncritical expenses, dividends and employee bonuses.

This is a key point for avoiding confusion and resentment over what your bank is willing to do for you. Some small business owners think the loan officer doesn’t understand their business requirements. At the same time, the loan officer doesn’t think the borrower is making realistic projections for anticipated cash flow, profitability, and the like.

As loans go, banks tend to view line-of-credit loans as low risk, so they carry the lowest interest rate. The bank may reserve the right to cancel the loan if it thinks your business is in jeopardy.  You’ll make interest payments monthly, regardless of when you expect to pay off the principal. For an annual fee, most banks will allow one-year lines of credit to renew almost automatically. However, they may require the credit line to be fully paid off for between seven and 30 days each contract year.

To learn more about lines of credit, contact SCORE “Counselors to America’s Small Business.” More than 35 volunteer business counselors in the Grand Rapids SCORE office donate their time to consult with and mentor entrepreneurs (In person or Virtual). Contact the Grand Rapids SCORE office at 616/771-0305 or go to www.scoregr.org.

Posted in Ask ScoreComments (0)

Build wealth by investing in your own company

As your business matures, the time will come when you will see excess cash and steady profits. Then the question arises of how to further increase the profits of your company. The stock market in recent years has been particularly unkind to the large companies that invested heavily in it. So plowing your profits back into your company may be the shrewdest move you can make in good times.

Lowering your overhead is a logical place to start, particularly if your rental payments keep going up. That may suggest to you that it’s time to buy your current building or look for one to purchase, so that you acquire a manageable mortgage that costs you less per month than renting. And once the space is yours, you can design the layout that will best maximize productivity. Longer term, you benefit from having the value of the building on your balance sheet and may be able to protect some of your profits from taxes due to the depreciation allowance.

Another approach to building value for your company is taking advantage of down markets to buy additional inventory-taking advantage of volume discounts and discounts at the end of a supplier’s selling season-or acquire better equipment. The latter approach might include computerized and electronic systems that can improve internal processes-again enhancing productivity.

However, another use for excess cash is to invest in financial instruments. You may decide, for example, that excess funds are best kept in treasury bills or certificates of deposit (if you can keep them there at least 90 days). Most likely, with available funds in excess of $100,000, you can make transfers between your checking account and your interest bearing investment account, despite the limit on the number of checks you can draw on the interest bearing account.

Lastly, you may want to consider acquiring a smaller company as a way of growing your business and expanding market share. If you go this route, prepare to learn more about business valuation at the same time you’re scrutinizing such assets as property, equipment and inventory, to be sure you really need them.

To learn more about sound financial management practices for your business, contact SCORE “Counselors to America’s Small Business.” SCORE is a nonprofit organization with more than 35 volunteer business counselors in Grand Rapids who provide free, confidential advice. Note Score now uses Zoom For the Grand Rapids Chapter of SCORE, call1-(616) 771-0305, or find a counselor online at www.scoregr.org.

Posted in Ask ScoreComments Off on Build wealth by investing in your own company

Ask SCORE: Read between the lines of your balance sheet

For newcomers to business, a balance sheet may appear at first to be a complex and confusing collection of numbers. However, this financial statement contains valuable information for assessing the health of your company and making decisions on which direction to take.

A balance sheet is like a snapshot of your company at a single moment in time. The balance sheet shows how the capital within your business is distributed over the various accounts. A surplus of assets over liabilities indicates profitability. If the statement shows more liabilities than assets, however, your company is at a loss position–not necessarily cause for alarm, depending on the longer trend. For example,  a business  may have a month with high expenses and a net loss that may be more than offset by five months of profitability. On the other hand, three consecutive losing months should prompt the owner to make serious decisions about how to overcome the negative cash position.

Compare balance sheets over a period of time for the big picture of your assets and liabilities. By comparing these on an item-by-item basis, you can spot trends that will affect your firm’s overall financial health. For example, larger quantities of merchandise on hand from one period to another may reflect a decision to buy ahead because of continuing inflation. Receivables may show a continuing upward trend when collection of outstanding accounts exceeds 30 days. Debts may run higher when the firm expands or makes capital improvements.

Much like the balance sheet, the profit and loss statement (or operating statement) totals the result of operations over a selected time period. This statement will show sales volume, cost incurred and the amount of profit or loss. Comparing the monthly or quarterly profit and loss statements can be revealing. Why was there a lower gross profit for several quarters? Did price cuts decrease per sale profitability? Was a higher proportion of sales spent on operating costs such as personnel, rent or insurance?  Are overhead costs increasing routinely?

Do not rely solely on your accountant for advice and guidance in understanding your balance sheet. As the decision-maker for your company, you need a clear understanding of how to read, interpret and act on financial information.  For assistance, contact SCORE “Counselors to America’s Small Business.” SCORE is a nonprofit organization having more than 35 volunteer counselors in Grand Rapids who provide free and confidential business  advice to veteran entrepreneurs and those just starting out. For the Grand Rapids Chapter office of SCORE, call 1-616/771-0305, or find a counselor online at www.scoregr.org. Rockford Chamber of Commerce 1-616/866-2000.

Posted in Ask Score, BusinessComments Off on Ask SCORE: Read between the lines of your balance sheet

Tips for driving small business success with strengths-based leadership

ASK   SCORE

SCORE, Counselors to America’s Small Business

You may be familiar with Gallup’s international bestseller, “Strengthfinder 2.0,” which has been helping professionals not only identify their strengths in the workplace but also how to further develop them. Not surprising, Gallup scientists have also been studying leadership and how a strengths-based approach to management can fuel the success of businesses.

“The data shows that organizations that work from a strength of their people are more profitable, productive, and have a higher level of employee engagement,” explains SCORE Mentor Jan Makela, who recently completed a Gallup Strengths coaching course.

How might you approach managing your small business with a strengths-based approach?

Here are five simple, practical tips from Makela to get you started:

1. Know your own top five dominate strengths (i.e., the themes that are your natural strengths). Focus on growing and getting better at what you already do well.

2. Don’t focus on what are not your strengths. But learn how to minimize your weaknesses by using your strengths to overcome areas that are not naturally strengths for you. 

3. Realize your talents give you a unique and powerful edge. The wonderful thing about talents is that they hold great potential for us. It is through our talents that we tap into our greatest potential for success.

4. Learn to recognize the formula for a strength: 

5. Skill + Knowledge + Experience (also known as Talent Xs) = Strength

6. Don’t try to fix your own weaknesses—or those of others. It can’t be done. Prove it to yourself: Rewrite this sentence three times with your non-dominant hand. How does it look, and how easy was it to do? Compare it to your dominant hand. See the difference? Focus and grow your strengths. 

Transitioning your leadership style to one that recognizes and nurtures strengths may require a shift in thinking and some extra work in the beginning. But the more you practice it and see positive results, the more natural a part of your company’s culture it will become. 

“You grow people from their strengths not from their weaknesses,” says Makela, “So find out what your employees’ strengths are and what they do best. Given the opportunity to excel, they will exceed your expectations.”

Further advice on doing business from a strength-based approach is available from SCORE, a nonprofit association offering a wealth of information resources, training, and free counseling designed to help entrepreneurs nationwide build productive, profitable businesses. 

A SCORE Counselor can serve as a sounding board and will provide valuable unbiased feedback on how to improve things. The SCORE Counselor can also look at the business from the perspective of a bank or other investor, and raise questions you may have overlooked.

All SCORE counseling is offered as a free and confidential community service. There are 30 counselors in the Grand Rapids office of SCORE. Call 616-771-0305 for an appointment with a knowledgeable counselor or e-mail us at score@grandrapids.org.

Posted in Ask ScoreComments Off on Tips for driving small business success with strengths-based leadership

The Advantages of hiring a multigenerational workforce

When many people think of diversity in the workplace, what often comes to mind first is hiring employees of different race, gender, and ethnicity. You can also achieve a richly diverse workforce by hiring employees from various age groups. Multigenerational hiring enriches the work environment, providing a wider range of knowledge, skills, creativity, perspectives, and work styles. When you have a broad range of ages represented in your workforce, you get years of experience and maturity along with youthful enthusiasm. 

What Beneficial Traits Do the Various Generations Offer?

While generalizations don’t hold true for all individuals, some common strengths within each of the categories include:

  • Traditionalists (Born before 1946) – These employees hold respect for authority and have a desire to preserve traditions and follow rules. They value teamwork and are task-oriented.
  • Baby Boomers (Born 1946 – 1964) – These individuals are often resourceful and disciplined. They typically exhibit a strong work ethic and drive to achieve goals.
  • Generation Xers (Born 1965 – 1976) – These self-sufficient workers are usually versatile and receptive to learning new skills. They accept change and have a generally good grasp on using technology.
  • Millennials (Born 1977 – 1995) – Employees in this age group are known for bringing a collaborative attitude and strong technology skills to the table. They tend to value openness of communication and candor. Most have a keen interest in advancing in their careers.
  • Gen Edgers (Born after 1995) – Also known as Generation Z, these individuals have strong self-reliance instincts. As early adopters, they aren’t afraid of trying new approaches for fear of failure. They are adept at using technology and tend to be well-connected and influential socially.

What Can Your Small Business Gain from Hiring Inter-Generationally?

The diversity in abilities and attitudes among employees of different age groups can create a more dynamic atmosphere within your business environment. With a healthy mix of traditional approaches and innovative thinking, you can strike a successful balance without becoming too stuck in your ways or too far out of the box. From your sales and customer service efforts to your product/services development and operational processes, having diversity can help you better recognize deficiencies and make improvements to your business by tapping the unique ideas and frames of reference within your team.

A Reminder

Remember that in all your hiring efforts, you need to follow all the applicable federal, state and local anti-discrimination and other labor laws. To understand the requirements, consider talking with a human resources consultant and/or an attorney. A mentor at your local SCORE chapter can assist you in locating trusted resources in your area and provide you with additional guidance and insight about starting and running your small business.

A SCORE Counselor can serve as a sounding board and will provide valuable unbiased feedback on how to improve things. The SCORE Counselor can also look at the business from the perspective of a bank or other investor and raise questions you may have overlooked.

All SCORE counseling is offered as a free and confidential community service. There are 30 counselors in the Grand Rapids office of SCORE. Call 616-771-0305 for an appointment with a knowledgeable counselor or e-mail us at score@grandrapids.org.  

Posted in Ask ScoreComments Off on The Advantages of hiring a multigenerational workforce

Considerations When Marketing A Niche Product

ASK  SCORE

SCORE, Counselors to America’s Small Business


While no product or service can be a good fit for everyone, niche products have an even narrower market than most.

If your business is focused on meeting a specialized need in a specialized market (for example, wholesale vegan spa products), the strategies and tactics others use to market their products and services may or may not be as effective for you. Marketing a niche product starts with creating a marketing plan that’s in step with your business plan.

Begin with rigorous market research. Resources like Reference USA and RMA financial profiles can provide valuable information, and, finding answers to these questions:

• Is the product new to the world, or are others like it already available for sale? 

• How can you differentiate your product from those that are similar? 

• How large is the niche, is it growing, and at what pace? 

• What’s the buying process? 

When you’re targeting a niche market, having a detailed profile of the customers to whom you’re selling is also essential. 

For starters, ask yourself these questions about the customers in your niche market:

• What are their needs?

• What are their expectations in terms of quality, price, speed of delivery, etc.?

• Where can you find them (virtually and physically)?

• How do they shop for products and services like yours?

Answering these and other questions will help you determine the ways to most effectively attract the attention of potential customers. 

Some possibilities might include:

• Networking at events and industry conferences that draw your target market

• Targeted social media advertising (online social networking sites like Twitter, Facebook, etc. offer pay-per click and pay-per-impression opportunities to present ads to customers who are in specific geographic areas, who fit certain demographic criteria, who have specific interests, etc.)

• Editorials in industry and trade magazines

• Radio spots during a program that draws listeners from your target market

• Guest posts on well-respected blogs that customers in your target market follow

Niche product marketing can be very cost-effective because you don’t waste time and money on people who have no interest in or need for your product in the process of reaching those that do. 

Test market your product…your unique selling proposition…your customer value to confirm your assumptions and validate your marketing assessment,” advises Burgum. “Although you can never be 100 percent certain about your conclusions, don’t be a victim of paralysis by analysis. Learn what you need to in order to minimize risks…and then go!

If you need guidance in marketing a niche product for your small business contact SCORE, a nonprofit association offering a wealth of information resources, training, and free counseling designed to help entrepreneurs nationwide build productive, profitable businesses. 

A SCORE Counselor can serve as a sounding board and will provide valuable unbiased feedback on how to improve things. The SCORE Counselor can also look at the business from the perspective of a bank or other investor, and raise questions you may have overlooked.

All SCORE counseling is offered as a free and confidential community service. There are 30 counselors in the Grand Rapids office of SCORE. Call 616-771-0305 for an appointment with a knowledgeable counselor or e-mail us at score@grandrapids.org.  

Free and Confidential Counseling

SCORE, 250 Monre Street NW

Grand Rapids, MI 49503

616-771-0305

www.grandrapids.score.org

e-mail: score@grandrapids.org

Posted in Ask ScoreComments Off on Considerations When Marketing A Niche Product

ASK SCORE

How to boost business using live video

Live video streaming has become one of the most powerful ways to forge stronger connections with customers. Apps like Facebook Live, Instagram Stories, Snapchat Stories, YouTube Live Streaming, and Periscope can help small business owners boost sales and strengthen their brands. 

Going “live” enables people to see what’s happening with your business in real-time and offers a more personal view of what your company does and who the faces are behind your logo.

If you’re thinking about giving live video streaming a try, here are some ideas to help you go live with content that will engage viewers and shine the spotlight on your small business’s strengths.  

• Introduce a new product or service. Live video provides a memorable way to communicate features and benefits and get people excited about your new offerings.

• Feature product demonstrations and how-tos. Live video offers an effective way to demonstrate how products work and teach customers how to use your products. “Seeing is believing.” If you show people your products or services improving productivity or making life easier for a customer, it adds credibility and builds trust. 

• Introduce a new team member. Sharing the credentials, capabilities, and personalities of new employees can facilitate a stronger personal connection with customers and enhance customers’ confidence in what your business can accomplish.

• Interview a raving fan customer and share their success story. This type of live word-of-mouth testimonial can serve as a powerful endorsement of your products and services. 

• Show a fun “day in the life” glimpse of your office culture. Streaming video of your team’s camaraderie during work can help humanize your brand and give your customers a sense of what it’s like behind the scenes at your company.

• Feature your company participating in a community cause. Capturing real-time moments of your team giving back to the community can build a stronger emotional connection with customers. People feel good about supporting businesses that commit themselves to causes that help those in need.

• Show your team members celebrating a milestone. Whether it’s making a toast to your business’s five-year anniversary or announcing a new project partnership, celebrating your milestones through live video can show people you’re a thriving and growing company.

• Introduce a new marketing campaign or a branding development. Streaming video to raise buzz about new promotional offers or rebranding efforts (like a new logo) can generate excitement and enthusiasm—and potentially sales!

• Show off a team member’s skills on the job. By featuring your employees’ expertise and capabilities, you can reinforce why customers should choose your products and services over those from your competitors. 

Gearing up to go live

Before you use live video for the first time, consider watching how other brands that sell products and services similar to yours are using live video streaming tools. That will help you generate more ideas and give you a sense of what resonates with viewers. Also, evaluate which live streaming platforms will benefit you the most. Consider your followers will be the most likely people to tune into your broadcasts. With that in mind, will one platform over the others reach more people in your target audience? 

As you explore using live video streaming to market your business, reach out to a SCORE mentor for insight and suggestions. With expertise in marketing and all other aspects of starting and running a small business, our mentors are here to provide guidance and align you with the resources you need to succeed.

A SCORE Counselor can serve as a sounding board and will provide valuable unbiased feedback on how to improve things. The SCORE Counselor can also look at the business from the perspective of a bank or other investor, and raise questions you may have overlooked.

All SCORE counseling is offered as a free and confidential community service. There are 30 counselors in the Grand Rapids office of SCORE. Call 616-771-0305 for an appointment with a knowledgeable counselor or e-mail us at score@grandrapids.org.


Posted in Ask Score, BusinessComments Off on ASK SCORE

Achieving Product/Market Fit For Your Small Business

AFor any startup to succeed, achieving product/market fit is among the most vital of goals. But verifying that your product meets a strong market need and can stand up to competitors is not an exact science, nor does it typically happen in one grand a-ha moment. Likewise, building momentum in a market requires patience and comes with no guarantees as customers’ needs, regulatory landscapes, and competitive pressures change over time.

Consider that your business will only succeed if it adds real value for the user. In this case ‘value’ means that businesses or individuals will understand they need or want it enough to pay you a price that will give you profit and success. Start by understanding your target market’s need and then whether you will be a better solution than your competition.

Despite the uncertainty and risk you face when starting a business, there are some actions you can take to increase your success in accomplishing product/market fit:

Do your homework to understand your customers’ current needs and anticipate what they’ll need in the future. Research your target demographic by spending time with prospective customers, read industry blogs and print publications, attend industry tradeshows and webinars, and seek out a professional in your industry who might serve as a mentor to you as you develop your products and services. 

Focus on one primary and critical value proposition. It’s impossible to be all things to all customers. By homing in on what’s most important to your target customers, analyzing significant trends in your industry, and identifying where competitors are falling short in solving customers’ problems, you can deliver value out of the gate. If you’re solving a pain point for your customers from the start, they will be more patient in waiting for you to add other features and options.

Listen. Learn. Adapt.

Have a business plan, but be open to change as you listen to feedback and ideas from your early customers. Learn from what they’re telling you can improve your products or services. And be prepared to adapt your systems and processes to make your business more viable and sustainable.  

Good planning and research will pay off in money/costs avoided and a far better marketing strategy and tactics that will resound in your customers’ minds. It is not ‘how’ you bring your product or service but rather what the benefits are in the language the customer understands. 

Further advice on doing business with your new small business is available from SCORE, a nonprofit association offering a wealth of information resources, training, and free counseling designed to help entrepreneurs nationwide build productive, profitable businesses. 

A SCORE Counselor can serve as a sounding board and will provide valuable unbiased feedback on how to improve things. The SCORE Counselor can also look at the business from the perspective of a bank or other investor, and raise questions you may have overlooked.

All SCORE counseling is offered as a free and confidential community service. There are 30 counselors in the Grand Rapids office of SCORE. Call 616-771-0305 for an appointment with a knowledgeable counselor or e-mail us at score@grandrapids.org.  

Posted in Ask ScoreComments Off on Achieving Product/Market Fit For Your Small Business

Six tips for maximizing the benefits of a business mentor

Ask SCORE


Embracing the help of a SCORE business mentor offers many advantages to entrepreneurs. Whether you’re in the early stages of exploring a business idea or already running an established business, a mentor can provide valuable guidance, serve as an objective sounding board for listening to and evaluating new ideas, and motivate you to be more accountable. With a SCORE mentor, you benefit from expertise and experience that can help you launch and/or grow your business.

Before you begin working with a mentor, consider what you can do to get the most fulfillment from your mentor/mentee relationship. 

• Don’t be afraid to ask questions.

Come prepared with a list of questions and issues you’re facing to every meeting with your SCORE mentor. Mentors are there to answer even what seem to be the silliest questions. They don’t judge you by what you know or don’t know. They are there to develop your understanding and awareness. And if they personally don’t know the answer to a particular question, they can tap into the expertise of other SCORE mentors within their chapter or nationally. 

• Focus. 

When you talk with your mentor, be entirely present and ready to focus on your business issues. Unless you need them for research during your meeting, put your digital devices away so they won’t distract you from your conversation.

• Have realistic expectations. 

Your mentor is there to advise you, not to do the work for you. You will gain insight and direction from a mentor, but you will still have to work hard. Starting and running a small business requires effort—no exceptions.

• Follow through. 

Do your homework! You should walk away from every meeting with your mentor with next steps (a.k.a. action items). Make sure you tackle what you agreed to do between meetings. If you slack off and don’t take the initiative to complete the tasks necessary to move forward, you won’t be able to take full advantage of your time together. 

• Keep an open mind.

You and your mentor may not always see eye to eye on certain ideas or approaches. Rather than instantly discarding suggestions that don’t align with your initial thoughts, consider your mentor’s frame of reference and experience in working with other SCORE mentees who faced similar challenges. The right answer may not always be what you want to hear, so it’s important to listen with an objective ear. 

• Keep the lines of communication open.

When first starting your business, you will probably find you need to meet with your mentor on a relatively frequent basis (possibly every week). As time goes by, your need to consult your mentor may ebb and flow depending on the nature of the competition you’re facing, industry changes, or opportunities you want to pursue. Even when you don’t feel you need to meet very often, keep your mentor up to date on what’s happening in your business via email or a periodic phone call. That way, your mentor will be informed and better equipped to provide guidance when you do face a new challenge.

Getting Started

To find a SCORE mentor in your area who has expertise in the specific aspects of small business you need help with, visit the SCORE website  www.grandrapids.score.org  

A SCORE Counselor can serve as a sounding board and will provide valuable unbiased feedback on how to improve things. The SCORE Counselor can also look at the business from the perspective of a bank or other investor, and raise questions you may have overlooked.

All SCORE counseling is offered as a free and confidential community service. There are 30 counselors in the Grand Rapids office of SCORE. Call 616-771-0305 for an appointment with a knowledgeable counselor or e-mail us at score@grandrapids.org.  

Posted in Ask ScoreComments (1)

Ask Score:

How The Business Structure You Select Affects Your Income Tax Treatment

The business structure you choose for your startup will affect your company from a legal standpoint, and it will have an impact on your taxes, as well. Before you decide on the structure for your small business, you should do some research and talk to tax and legal professionals for guidance. The better you understand your options, the more likely you’ll be to operate under the structure that will benefit your business the most. 

An Overview Of A Few Of The Most Common Business Structures

Sole Proprietorship

By default, businesses are considered sole proprietorships (partnerships if more than one owner) if their owners don’t register them formally as independent entities. Many at-home businesses start this way because sole proprietorships require the least amount of registration paperwork and ongoing compliance efforts. From an income tax perspective, a sole proprietorship is also considered one in the same as its owner. Your business profits and losses flow through to your personal income tax return.

(Note that with a sole proprietorship, your personal assets are not separated from those of your business. This poses some risks. Your home, bank accounts, retirement savings, and other personal belongings might be in jeopardy if someone were to sue your company. When you form a Limited Liability Company [LLC] or incorporate your business, however, your personal assets receive some protection from legal action brought against your business. Be aware liability protection and tax treatment may vary depending on the state where a business is incorporated matters, so it’s important to talk with an attorney and tax professional.) 

Limited Liability Company (LLC)

You can form an LLC as either a single-member (single owner) or multi-member (multiple owners). This legal structure provides the limited liability advantages of a corporation and the flexibility of a sole proprietorship. As with sole proprietorships/partnerships, an LLC’s profits and losses flow through to owners’ personal income tax returns. In addition, LLCs offer some tax flexibility; you can elect to have your LLC taxed as an S Corporation or a C Corporation.

S Corporation 

The S Corporation structure has gained the favor of many small business owners because it offers one level of tax at the shareholder level and some relief from the self-employment tax burden on owners. Only an owner’s reasonable wages/salaries are subject to self-employment (FICA) tax, and profit distributions to shareholders flow through to the individual shareholders’ income tax returns. 

C Corporation 

C Corporations offer more extensive personal liability protection and growth potential than other structures, and the way income taxes are applied differentiates this structure, too. With a C Corp, income is taxed at the corporate tax rate when your business earns it. Profits are then taxed again at the personal income tax rates when shareholders’ distributions are made.

Partnerships

Another important type of business structure, partnerships come in different legal forms, including corporations, limit liability, and managerial control. Tax treatment and personal liability protection vary depending on the type of partnership you form and the state in which you incorporate.

Get The Right Help To Make The Right Choice

The information we’ve provided here is meant to share some of the basics you should know when deciding on the business structure for your small business. It is not intended as professional legal or accounting advice. Carefully consider your type of business and long-term plans when determining the best legal structure for your business. We also recommend you consult a reputable attorney and business tax expert for insight and guidance. If you need help finding trustworthy professionals in your area, talk with your local SCORE chapter for recommendations.

Further advice on doing business is available from SCORE, a nonprofit association offering a wealth of information resources, training, and free counseling designed to help entrepreneurs nationwide build productive, profitable businesses. 

A SCORE Counselor can serve as a sounding board and will provide valuable unbiased feedback on how to improve things. The SCORE Counselor can also look at the business from the perspective of a bank or other investor, and raise questions you may have overlooked.

All SCORE counseling is offered as a free and confidential community service. There are 30 counselors in the Grand Rapids office of SCORE. Call 616-771-0305 for an appointment with a knowledgeable counselor or e-mail us at score@grandrapids.org.  

Posted in Ask Score, BusinessComments Off on Ask Score:

advert
Advertising Rates Brochure
Kent County Credit Union
Watson Rockford
Ray Winnie
Cedar Car Co

Archives

Get Your Copy of The Cedar Springs Post for just $40 a year!