Operate Your Business

Operate Your Business


Your Business Plan should define those things used in the day to day operation of your business.  I create a separate document for these items (and maintain a link to it in my business plan) since these are more likely to change.  I also maintain a separate document liked back to the business plan – an operator’s  manual that defines standards and operating procedures.

IT Infrastructure

  • Computers, Printers
    • Record what devices are transferred to your business (must be dedicated to business, not shared use), purchased, or leased
    • The commonly used criteria is that anything over $500 should be capitalized, and the expenses amortized over a period of years (as defined by the IRS)
    • Identify all devices in your business plan with date of purchase, model, serial number, warranty and service plan expirations.  Include support contact information

  • Software
    • The software you use to operate your business is typically capitalized, and the expenses amortized over a period of year (as defined by the IRS)
    • This includes accounting software, utilities (like video tools, etc.) and other software tools used in your business.
    • Identify all software used by your business in your business plan with date of purchase, provider, version, serial number, warranty and service plan expirations.  Include support contact information

  • Internet, Routers, WIFI, Network
    • Internet service if dedicated to your business, is deductible.  
      • Example: In my home office, I use a shared WIFI router but my laptop and printers are hardwired to the upgraded business-class cable modem.  Since there is a line item on my bill for the business-class internet upgrade, that differential is deductible.
    • Identify all networking devices used by your business in your business plan with date of purchase, provider, version, serial number, warranty and service plan expirations.  Include support contact information

  • Security
    • It is simply irresponsible to NOT have antivirus and anti-malware software on any device used for your business.
    • Be sure you have WIFI security ENABLED on your WIFI router
    • Passwords should be required on all devices, all software, and all websites used in the conduct of business.
    • Passwords should be secured (not posted in your office or accessible to anyone else).  Passwords should be a minimum of 8 characters, mixed upper and lower case, they should contain a number, and if permitted, special characters like !^#
    • Physical security for your home office and business records
    • Offsite or secure cloud backup storage (See GotBackup)
    • Declare your security guidelines, practices and procedures in your business plan

  • Websites, Hosting, Software
    • Define any hosting, websites, blogs, membership sites, and any browser-based software in your business plan, along with warranty, support, expiration, and contact information
    • It is a good idea to declare the domain registrar name, website, and support/billing numbers.
    • Record the NAMESERVERS (DNS) and any forwarding/masking URLs
Business Insurance
  • Errors and Omissions Insurance
    • Some businesses require insurance that protects you against inadvertent errors and omissions. 
      • For example, as a consultant, I gave advice to my clients that could have huge operational and financial consequences.  Upon consulting my insurance professional, we decided on an errors and omissions policy that protected both me, and my clients
    • Consult your insurance professional
    • Make note of this in your business plan

  • Liability Insurance
    • This could be liability on many levels. It protects your assets in the event of law suits
      • Example: I had a real estate investment and a property management company.  If any of my tenants would fall or sustain an injury on my properties, liability insurance would provide legal and financial protection
    • Consult your insurance professional
    • Make note of this in your business plan
Employees
    • Workmens Comp (if you have employees)
      • There are Federal and State regulations pertaining to employer liabilities if an employee is injured or killed on the job.
    • Benefits and/or Medical Insurance
      • With the new Federal laws, an employee must have medical benefits, whether provided or not by the employer
    • Payroll Processing and Tax Withholding/Filing
      • Federal labor laws and state regulations pertain to payroll, handling of funds and reserves, payroll tax submission requirements, and reporting requirements.
      • Make note of these in your business plan
      • Be sure you have W-9 or green card information on file for all employees
    • HR
      • Federal labor laws and state regulations pertain to hiring, firing practices.  
      • Make note of how these regulations apply to your business
    • Americans With Disabilities Act Compliance, OSHA
      • Be sure your business is in compliance with all accessibility and safety requirements

 

  • Policies and Procedures
    • Personnel policies and procedures should be PUBLISHED
    • They should also be referenced in your business plan
Pro Forma – a Projection of Current Assets, Revenue, and Expenses
  • Start-up Expenses
    • Define the items and financial value to establish baseline
  • Fixed Assets
    • Items and financial value of buildings, properties, fixtures, equipment, furniture
  • Expenses
    • Recurring expected expenses
  • Revenue
    • Expected revenue from stated business activities
  • Liabilities/loans/financing
    • Define those things that reduce revenue and carry future liabilities to determine net revenue for this and future accounting periods
  • Equity
    • What is the expected owner draw from the business and retained equity
Professional Resources
  • Attorney
  • Consultant
  • Accountant
 
Business Continuity
  • Backup and Recovery
    • You should have a plan that states how business would be conducted in the event of business interruption
    • Define the process and procedures that ensure post recovery future operations

  • Storage
    • What, where, how it is created, updated, and accessed to ensure business continuity

  • Security
    • Define security processes and procedures associated with a disaster recovery or business continuity plan

  • Records Retention
    • There are certain legal requirements regulating what documents are necessary, and how long they are to be retained for legal and financial purposes (may be different retention requirements)

  • Records Destruction
    • Define the records destruction schedule and procedures.
 
Exit Strategy
  • Dissolution and Sale
    • Define any issues, liabilities, and contingencies associated with disollution of this business
  • Merger/Acquisition
    • Define any issues, liabilities, and contingencies associated with merger of this business with another entity, or acquisition of other entities
  • Asset Division/Distribution
    • Define asset division and distribution of residuals associated with dissolution of this business

These items should be referenced in your business plan but could be in a separate document

Marketing Plan
  • Media – Print, Email, TV/Radio/Internet, Telemarketing
    • Discuss the intended media utilization for marketing
    • Market segmentation
    • Telemarketing Compliance

  • Advertising Strategy
    • Discuss the strategy and plan for current advertising issues
    • Resources, tools, approach, timing, creative assets

  • Elevator Speech
    • This is a 30 second summary of what you would tell a prospective customer to introduce them to your business

  • Value Proposition
    • Why should a prospect want to do business with you, buy your product or service?
    • WIIFM – from the customer’s perspective, What’s In It For Me?
Product Creation
  • Design
    • Who, what, where, when, how, why

  • Creative
    • What creative assets were utilized?

  • Patents, Copyrights, and Licenses
    • Protections for your creations, and terms of use

  • Franchises
    • Legal and financial terms
Legal
  • Contracts and Leases
    • Define what contracts are in place, parties involved, term, terms and conditions

  • Partnership Agreements
    • Legal, and financial specifics

  • Legal Forms
    • Forms commonly used in your business, source, validation, update frequency, schedules

  • Notary Services
    • In-house or contracted services to certify authenticity of signatures and ownership

 

 

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Copyright (c) 2016 Richard Moyer





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