Business: Be Smart, Be Effective, Be Efficient.

When starting a new business there is always so much to learn and gain, even from the smallest of tips. Working with several clients at the start up of their businesses as well as pulling from my own business experience, I have contemplated and compiled the top 5 methods of increasing your business efficiency without increasing your overhead.

Tip #1: Time is money.

While already having discovered the magnificent benefits of business exposure through social media, taking the time to actually sit down, create posts and publish them every week, let alone every day, might not be an option. Utilize tools such as Hootsuite, or the WordPress scheduled posting feature to draft and schedule your posts in advance. With this, you can schedule, monthly, weekly or even daily posts far in advance in one sitting. This will keep your social media presence alive, as well as your business exposure, without taking up too much of your precious work time. Once you have done this, consider your other automated task options such as billing or e-mailing. Converting such manual tasks to automated tasks will save you loads of time and therefore save you money.

Tip #2: Productive communication.

E-mail has been and still is the most efficient means of communication. From small retailers to large corporations e-mail systems help to keep businesses up to date on business related information whether in or out of the office. Other methods similar to e-mail include social media messaging. Focus on such methods of communication and try to avoid cold calls and door to door selling where possible. Establishing firm, efficient communication through messaging will help your business avoid unnecessary rejection for the messages you receive back will most likely be those of interest, thus helping you find clients without the extra effort.

Tip #3: Grow your business through referrals.

Asking clients for referrals is a simple method of finding potential new clients. Think of this method of approaching new clients as taking an educated guess rather than blindly searching for prospective customers. One way to create incentive  toward gaining referrals is to offer rewards to current loyal clients or those who provide referrals. Rewards can be as simple as discounts or further service. Both methods will improve your client traffic and business services without breaking the bank.

Tip #4: Provoke employee efficiency through your own efficiency.

Always be an efficient leader through efficient time management. Train employees and others to contact you through email versus over the phone. Why? E-mail can be saved, stored, tracked, referred to and is almost always readily available. Furthermore plan out everything and add it to your calendar. Be sure to plan out your entire week in advance. Add everything to your calendar. If something is not scheduled on your calendar, it should not take place. While this takes discipline, politely sticking to this will gain you respect from both clients and employees. Lastly, utilize the cloud. Use tools such as Drop Box or Google Drive. This will allow you to easily access documents anywhere Wi-Fi is available. It also allows you to easily collaborate and share with others.

Tip #5: Be Patient.

Those working in the field of business can attest to the fact that not everything works out the way you want it to. Many times, procedures take time and effort. Such an investment however, given enough time, may yield significant time and money saving results. Be flexible and try new methods and ideas, while weeding out those that do not work for your business.

Utilizing these 5 tips can help your business run a bit more smoothly by saving you a little bit of time and money.

increased quality - speed - efficiency

Does Your Sole Proprietorship Require a Federal Tax ID?

Business and Taxes go hand in hand!

Many of my new client initial contacts revolve around inquiries about trade secret, trademark or copyright protections.  While these are important new business issues to address, more often than not new business clients are so focused on the nuts and bolts of their new venture that they have not thought too much about whether and how to organize that business.  While corporate or limited liability entities are sometimes appropriate, the initial activities of many new businesses occur by an individual doing business as a sole proprietor under their own name or a fictitious business name.

One frequent question is whether or not a sole proprietorship requires a federal Employer Identification Number (EIN). Like many, the answer to this question is not a simple yes or no.

What is a Sole Proprietorship?

A sole proprietorship is a business run by a single owner. While it is possible to have more than one individual running the business, there can only be one person listed as the entity’s owner. The owner of the sole proprietorship is personally liable for any debt incurred by the business or lawsuits brought against the business. Despite this, running a sole proprietorship has its perks. For example, the owner of such a business has complete control over any and all decisions made concerning the business. Also, a sole proprietorship is not required to be chartered by any state and finally, while every business, regardless of the type of entity, is responsible for paying both state and federal taxes, not every sole proprietorship must obtain an EIN.  Only certain sole proprietorships must obtain this tax ID, if their business meets the requirements laid out by the IRS to do so.

Standard Requirements:

Any sole proprietorship falling under the following categories must obtain and file taxes under an EIN:

  • Sole Proprietorship with employees
  • Sole Proprietorship that withholds payroll income taxes
  • Sole Proprietorship that files federal tax returns on employment, excise, alcohol, tobacco, and or firearms
  • Sole Proprietorship involved in real estate, plan administration, farmers cooperatives and trusts, or holding Keogh plans

Whether required to obtain an EIN or not, every sole proprietor has the option of doing so.  Even if an EIN is not required, it may be preferred simply in order to separate the client’s business financial activity and tax reporting events from the owner’s personal social security number.

How to Apply for an EIN:

EIN’s are issued by the Internal Revenue Service.  The process is simple.  An individual can request up to five (5) Employer Identification Numbers a day from the IRS.  Individuals may request their EIN by mail, through fax, online or by telephone.  For a quick approval, obtaining an EIN by telephone or online is the best method. These two methods enable an individual to have their EIN approved immediately if no additional information is required.  If requesting an EIN by mail or fax, allow for at least 4 weeks before expecting an EIN issued for your company. EIN applications sent by fax or mail are processed on a first come first serve basis.

The following website contains a fast, secure online form to request a Federal Tax ID.  http://www.simplefilings.gov-tax.com/federal-ein/

Regardless of the method one chooses to use, obtaining an EIN is fairly simple and provides your business with a form of federal identification separate from the owners personal identification information.