How Much Should You Pay Yourself?
Owners earn compensation in two ways. First, the owner should earn a paycheck just like any other business employee for working in the business. Second, the owner should earn a return on their investment in the business.
Financing Your Shop’s Future
In a perfect world, small businesses would have enough capital to fund any renovation or new construction project they wished to pursue. Buildings would never be run down, shops would use the latest equipment technology and operating space wouldn’t be an issue. But this isn’t a perfect world. Construction costs can add up quickly, and not every small business has enough free capital to fund a project without bank financing.
Increase Your Shop’s Financial Performance To Boost Its Market Value
There are many factors at play when determining the right time to sell your business. Each business and each owner is unique. The timing of a business sale is critical because putting a business on the block at the wrong time can result in a significantly lower selling price.
Ensuring Financial Success For Your Business
Can you point your company in the direction of financial success, step on the gas, and then sit back and wait to arrive at your destination? Not quite. You can’t let your business run on autopilot and expect positive results. Any business owner knows you need to make numerous adjustments along the way. For example, there are decisions about pricing, hiring, investments, and so on.
Value Of A Business Plan
Business plans are for start-ups, right? Why would an established business need one? The fact is, the questions you have to answer as a start-up get forgotten in the daily hubbub of running a business. A little time spent asking some basic questions can trigger new opportunities, greater freedom or both.
Do You Know Your Shop’s Break-Even Point?
Business owners need to know their monthly break-even point to help them project business profitability each month. The break-even point is very easy to calculate and will take seconds if you have an accurate profit and loss statement.
IRS ‘Dirty Dozen’ Tax Scams
Compiled annually by the IRS, the “Dirty Dozen” is a list of common scams taxpayers may encounter. While many of these scams peak during the tax filing season, they may be encountered at any time during the year.
Managing Cash Flow
Are you paper rich but cash poor? A business can be profitable on paper, but bankrupt in real life – if you don’t manage cash flow effectively. Without cash, a repair shop will inevitably shut down, regardless of how profitable it looks on paper. You can be “rich” in accounts receivable and inventory, but cash poor if these assets are not convertible into cash to meet current obligations. In fact, cash is the only asset a company needs to stay in business.
The Benefits Of Financing
Even if a business chooses to purchase equipment, rarely do they purchase it with cash. In fact, whether leasing or buying, “seven out of 10 companies use some sort of financing when acquiring equipment,” says William Sutton, president and CEO of the Equipment Leasing and Finance Association.
A Gift Steve Jobs Left For Shop Owners
According to a recent article in The Wall Street Journal, some CEOs are starting to understand the price they have to pay for quick profits, and many of them are now taking a different approach. Although all companies should consider their long-term growth and financial stability, there has been an ongoing challenge that today’s CEOs face – the relentless demand for immediate profits that is put on them by their stockholders.
Buying vs. Leasing Equipment
Equipment costs are unavoidable. Whether it’s the front of a shop, back office or in the bay, repair shop owners and tire dealers need a variety of tools to keep their businesses running. The debate for many business owners is if they should buy or lease this equipment. So when it comes time to make equipment acquisition decisions, it’s important for business owners to understand the pros and cons of buying and leasing.
2015 Year-End Tax Planning
While the fate of several business-related tax extenders such as Research & Development tax credits, bonus depreciation, and Section 179 expensing that expired at the end of 2014 is uncertain, there are still a number of end-of-year tax planning strategies businesses can use to reduce their tax burden for 2015.
