We Can Make a Business Successful; Here are Three Important Things to Focus On!

Business  require a lot of work and time spent working on it to assure that a product is specific to each customer that walks through your door.  The new business requires that you advertise, manage money to its fullest, and in the end make it last so that you can pass it on to your children and family.  You may have to even sign a personal guarantee to investors. Today we are going to address these three subjects, because the idea of opening your own business is that you will make a profit, and be able to continue the business for years to come. It is up to you to make your dream of a business come true, and we are going to help.

What What Form of Advertisement Should I Use?

Lead Generation System

Now that your business is open, the biggest question should be how should I advertise my business?  It is likely that you have a fixed budget, and you are not sure where to turn. First and foremost, you need to create a lead generation system.  Let’s say that you are the proud owner of a new food truck, and you want to get people to visit your location on specific days?  How do we initiate customer interest in your service?  Given technology today, you could start anywhere. Ideally you would need to test the different types of advertisements.  Which one works better for your entity?  A suggestion for your business might be social media.

Advertising On A Budget With Social Media

Approximately 81% of the US population uses social media in its various forms.   It may work to just use one of these avenues to advise your business followers where the truck will be on a certain night.  In many cases social media offers a free form of advertisement that can reach all of your friends, and if your service is good you can reach many of your friend’s friends.  If you offer consistency, there is a good chance your business will thrive.

You must make an investment in your advertising, and then test, test, test. Keeping statistics on the form of advertisement that you choose is vital.  It will let you know for future advertisements which form produced the greater amount of leads for your business. Once you find a good response, repeat the advertisement,  because it works.  You want to find out the cost per lead with each of your campaigns.  For help with your advertisements you may want to check out the Data & Marketing Association.  They have many educational programs to help your business in its endeavor.

Money Management is Key to Your Business

 

It is hard enough to maintain a budget for family life, and now you want to fund your business on top of that? As we have mentioned in other blogs, now that your business is open and incorporated, you will have the eye of investors and banks who may not have otherwise have been interested in your ideas.  These investors may be able to loan your business some money to help get it off of the ground.  That’s where a Personal Guarantee is  at it’s start.

What is a personal guarantee?  it is an unsecured written promise from you, the business owner, to the bank guaranteeing the repayment of your loans.  Since it is unsecured, you need to know that the guarantee is from you, not the business.  Therefore, the responsibility lies on you to make good on your agreement.  If your business goes under, the personal guarantee will be your personal responsibility.  When you have a business and business line of credit it is important that the owner maintain good records for the financial part of the business.  Should the day arise that you do not want to maintain the business anymore, you will not be able to just release yourself from the debt. This burden of debt and liability may, in essence, be passed on to the next owner.

Bankruptcy! Don’t Do It!

Perhaps the food truck you started out with was a vegetarian food truck.  Although it was original, it did not promote as well as your friends burger truck. The money is just not flowing as it needs to be.  There are more bills to pay than there is cash flow coming in.

How can you pay the bills and relieve yourself of all the business debt?  What about a business bankruptcy?  Cant I just file for bankruptcy and start fresh? Would I be free of all the loans and credit card debt that the business created?  It would not be that easy.  Ultimately, it is likely that you can file for a business bankruptcy , but it comes with a ton of baggage.  You will have this on your shoulders for the rest of your life. Additionally, you will still have the debt and be labeled with the fact that you filed a bankruptcy.

Contrary to popular belief, Bankruptcies don’t disappear after many years.  The question on the loan application and even on job applications these days is, “Have you ever filed a bankruptcy?” not “have you filed a bankruptcy in the past 7 years?”  We do not recommend to entrepreneurs to file a bankruptcy on their business.  Each case is significantly different that the other, and we recommend that you seek legal advice about your financial case.  You can always contact us at AmeriLawyer.com.  It is a possibility that your debt may be able to be re-negotiated, or a change in the business model may help move your business back to a positive working environment.

Changing Your Business Model to Boost Your Income

You have re-negotiated your business model, and now the food truck is doing so much better.  Rather than just vegetarian food as the headline, you have changed it to a pasta truck with a vegetarian friendly menu.  The food trucks leads are now moving swiftly and you are even doing so well that your staff had to grow as well. You are also catering parties as an additional service.  your company gained a partner and  has now built a restaurant and added 3 additional trucks in the same name as the original food truck company.  The business has thrived and doesn’t show signs of slowing down.  It is time to start considering where you will go when the time comes to leave this earth.  Who will the business go to? Your business is now back and better than ever.

Revocable Trusts vs. Wills

How can I make sure that the business goes to my child if I should pass away?

Your business is going well and your family has grown.  What is the best way that you can secure your assets to go to the children?  The best suggestion would be to place your asset in either 2 individual trusts or a joint livable or revocable trust.  This way should you pass, the assets skip probate and go directly to the intended party.

What is are the benefits to having a revocable trust?

• Avoiding probate: What does that mean? If an estate has to go through probate, the court determines what assets are part of the estate, the court marshals the assets of the estate, and then the court disposes of the assets in accordance with the Last Will and Testament or as provided in the state statutes. Such a probate process can be quite lengthy and expensive. With the Joint Revocable Living Trust, Probate is avoided because the Trust assets are owned by the Trust rather than the individual decedent.
• Isolating Liability: Using multiple Joint Revocable Living Trusts for different family members, you can avoid spillover of liability to other family members. For example, Mother Smith, the matriarch of the Smith Family, sets up one trust for Daughter Smith and one trust for Son Smith, because she knows that the local police are staking out Daughter Smith’s Botox shop. The Internal Revenue Service is upset that Son Smith hasn’t filed his tax return since 1993. By isolating liability and using multiple Joint Revocable Living Trusts, Daughter and Son Smith’s issues won’t spillover and affect each other.
• Ease of administration: If an individual establishing the Trust has real estate, the cost of probate administration is avoided because the property held in the Trust will pass at the decedent’s death free of probate unless the Trust estate is to be distributed to the decedent’s estate.
• Revocability: Cutting someone out of your estate plan? The Joint Revocable Living Trust allows you the flexibility to make changes to the trust document while you are still competent and alive.
• Privacy Preservation: Don’t want your friends and relatives aware of your private affairs? The Joint Revocable Living Trust allows the transfer of your personal assets to remain private within the parameters of the trust document. That is distinguished from the situation where if you had a Last Will and Testament, the probate process would expose your estate to the public.
• Creditor Protection: What happens with a trust beneficiary law suit? Do you want a creditor to get any of the       beneficiary’s money? Creditor Protection prevents creditors from attaching the interest of the beneficiary in the Trust before there are cash or property distributions.

Also if  you decided to purchase life insurance you could place that in a trust as well.  The benefit of a trust is that if you pass away, you will avoid probate.  Also if you place your life insurance on a trust it will add to your gross estate.  This will benefit you for tax purposes.  Another factor may be that you may have forgotten an asset.  You would not necessarily have to put it in the trust. You could simply add that asset to your will.

A Last Will & Testament

A will is a disposition of assets from a person to their heirs. Having a Last Will & Testament means a person has the freedom to choose who are their heirs, Personal Representative or Executor to administer their estate, what gifts are made and to who or what, who is a guardian of surviving children, who bears the tax burden and whether real estate and other assets may be sold with probate court proceedings. It is very important to insure the Last Will & Testament meets certain formalities so it is deemed valid.

For more questions as to which is better for your situation,  you can contact us at www.AmeriLawyer.com

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Spiegel & Utrera, P.A. is a corporate law firm with its main offices located in Miami, Florida with offices throughout the United States. As a law firm, we do more than just help you form your business entity. We stand ready to help with the maintenance of your legal business entity! We will assist you with Incorporation Service, Trademarks, Copyrights, Estate Planning, Legal Counsel, Wills,Trusts, Agreements & Leases, Corporate & Company