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If you are in the stage of starting your own detail
business, you will benefit from reviewing every possible angle of
your business. It's also an excellent way to test the waters as
you fine-tune your business venture. To help you get started, consider
these questions and your answers they will help you avoid some of
the pitfalls associated with new business startups.
1. How do I know if this
is a good idea for a business?
The Small Business Administration (SBA) has put
together 3 criteria for a successful business. You should be able
to answer "yes" to at least one of the following: Does the detail
business serve a presently unserved need? Does the detailing serve
an existing market in which demand exceeds supply? Can a detail
business successfully compete with existing businesses catering
to the same market niche?
2. Should I write a business
plan?
A business plan helps you to organize all aspects
of running the business. It will help you answer all of the questions
you need to in order to start your business with confidence. The
business plan should contain: a summary of what your detail business
is; a brief outline on how you plan to sell this service; an overview
on who your customer is; a budget; a financing plan; a strategy
for getting publicity and generating interest in detailing.
3. Will I need a lot of money?
The start-up capital you'll need will vary depending
on what type of detail business you are starting. However, you should
figure out what it will cost to establish a legitimate detail business
including cost for equipment, the best available; license; startup
capital, etc. and then establish your budget. Once set, determine
how many cars you'll need to detail each month to survive. Your
monthly income should, of course, be greater than your expenses.
If detailing is your area seasonal, figure out how much you need
to make during your high season to sustain you through the dry months.
4. How will I know if my detail
business is successful?
Success is rated in many ways. Picasso said that
if one could see no line of demarcation between work and play, they
had achieved success. Some measure success in terms of money, others
in freedom and flexibility. It's up to you.
5. What hours should it work?
The beauty of being your own boss is that you can
pick your hours of operation. Obviously, you will need to be open
when it is convenient for your customers.
6. I'm easily distracted. How
do I overcome this?
You'll have to muster up discipline to stay with
it. To make a daily plan, work the plan and achieve the results.
If you fail, then review and determine what went wrong!
7. How can I achieve this level
of discipline?
Focus. Focus. Focus. You must be disciplined enough
to create your business and follow-through. This is the ultimate
test for any business owner. If you can't get focused and follow
through, then you might be better off working for the other guy,
and leaving it all behind you when the 5 o'clock whistle blows.
8. How do I find out about
zoning?
Go to your local town hall, zoning office or even
the local library. Ask for a copy of the zoning laws. In many areas,
the communities have not yet updated their zoning laws. If you read
that you can't do something in particular that you have in mind,
don't worry-make a few calls to the zoning committee and find out
if they have expanded their interpretation of the law.
9. What if I don't meet zoning
regulations?
Call an attorney (specifically, one who deals with
zoning) and inquire about the specifics of the law. He or she might
have a way you can get around the regulation. You can also contact
the zoning board in your community and ask them to make an exception
by applying for a "variance." A variance waives the law. Another
option is to conform to the law by changing your operation.
10. What about licenses and
other regulations?
Many people start businesses without investigating
what Local, State or Federal laws exist concerning their detail
business. It seems that many coast by for years without being discovered
by the Internal Revenue Service (IRS) or other government agencies,
but once they do, they can levy heavy fines and penalties. It's
best to get it right from the start. Make a call to your county
clerk's office. That will clue you in as to the various licenses
and forms you need to acquire or to file. This applies especially
to conforming to water discharge. Every detail operation should
obey the law with regard to discharging water and chemical of any
type on to the ground or into the storm server. This is illegal
in every State and every city in the USA.
11. Do I need to open a separate
bank account?
Whether or not you operate the business under your
own name, you should consider opening a separate bank account for
your venture. If you are planning on conducting business under a
name other than your own, you will need a bank account in the name
of the business so that you can cash checks that are made out to
"Quick & Easy Mobile Detailing." To get the bank account requires
your file an assumed business name with your state. To do this,
check with your county clerk. You'll need to pick up three "Doing
Business As" forms from a local stationery store. The forms cost
about $1. Fill them out, have them notarized, then take them down
to the county clerk's office. The county clerk will keep one copy;
you keep another and take the third to the bank where you want your
bank account set-up. You will also need to obtain an Employer Identification
Number from the IRS. This is sort of like a social security number
for your new business. Different businesses need different types
of licenses. The county clerk or the local SBA office can help point
you in the right direction. Make a call to the IRS office in your
region and ask them to send you an information package on tax filing
for your small business. You might want to secure the services of
an accountant who will help you do your taxes. It's a great investment
for any small business owner.
12. Do I have to incorporate?
No, you do not. There are other, easier, options.
Sole-proprietorship is one method. If you have a partner, then you
might want to consider forming a partnership as your legal structure.
For specifics, consult an attorney or call your local SBA office
for more info.
13. What are the advantages
of incorporating?
The main advantage is that you will have limited
personal liability.
14. What are the disadvantages?
You will have to spend more time and money filing
licenses, taxes, etc. as a "corporation." There are various forms
of corporations that you might also want to consider such a Sub-Chapter
S and C Corporations.
15. How do I set up a corporation
or a Sub-S Corporation?
This offers you the limited liability option of
a corporation along with permitting all of the income or losses
from the business to go to you directly as an individual as though
you were running either a "sole proprietorship" or a "partnership."
Early on in your new business venture, it's always a good idea to
spend a few consulting hours with an attorney who specializes in
small business. He or she can spell out all of the legalities and
point out plenty of other helpful advice. You do not need an attorney
to set up a corporation, but they can help you cut through a lot
of the red tape for a fee, of course.
16. What is a sole proprietorship?
This is the easiest way to get your business venture
rolling-and the cheapest. Basically, this form of doing business
can be organized very quickly. You just begin. You should call the
local county clerk and determine whether or not you need certain
business licenses and/or permits to proceed.
17. What are the disadvantages
of a sole proprietorship?
In setting up this type of business, you will be
liable for everything in respect to financial and legal obligations.
For example, if you can't pay the bills, the creditors can go after
your car or house or van. If a customer falls on your property,
he or she can sue you and you could lose everything. It is still
the most popular business form chosen by entrepreneurs.
18. What is a partnership?
A partnership is a group of more than one individual.
It costs more to set up than a sole proprietorship but costs less
money than it does to set up a corporation.
19. What are the disadvantages
of a partnership?
Make sure you like working with all of your partners
because it won't be easy to alter agreement. All partners are responsible
for honoring debts of the partnership. So if one partner slacks
off, the others must come up with the money for his or her share.
If one partner goes under, he or she could drag down the others.
20. Are there any advantages
to a partnership?
In many cases, entrepreneurs enjoy the camaraderie
of dealing with a group of people. They are used to dealing with
a group from their working days, and find it bolsters confidence
to go after a goal with another person or persons.
21. What about sales tax?
In the old days prior to the Tax Reform Act of
1986, a small business owner could deduct sales tax as an itemized
deduction. This is no longer possible. The sales tax can be included
as part of the original cost of an asset which may be depreciated
for business use. It's a good idea to contact an accountant when
starting your business. You won't have to keep them on some heavy-duty
retainer, but can pay them on an hourly basis. With the hassle of
changing laws and taxes, it's a very good idea to work with a pro
who understands all of the tax laws changes on an up-to-the minute
basis.
22. How do I go about setting
up a bookkeeping system?
It's a good idea to investigate local classes at
adult education or even a seminar with the SBA on bookkeeping or
in setting up a very basic accounting system. Even if you have the
money to hire an accountant, you should get a grip on your business'
financial affairs. You should be able to explain to yourself how
much money you owe out to others, how much others owe you and how
much cash you have on hand.
23. What types of records do
I need to keep?
You'll need a check register (to record all of
the checks you write); a cash receipt system (to list the amount
of cash you received, on what date, and from whom); a record of
bills (to know what bills you owe, to whom and the amount owed);
journal (to keep a daily agenda of everything you do, everything
that relates to the business, everything you sell) a journal is
a great system to start and maintain no matter how big your business
gets.
24. How can I make all this
easier to handle?
You could investigate the wide variety of software
systems that are on the market. Many deal strictly with setting
up and handling an accounting system.
25. Why do I need to do this
if I hire an accountant?
You will need tools to turn over to the accountant.
You can't walk in with a bag full of receipts. The more organized
you are, the more organized you will be when presenting this material
to an accountant. That translates to reduced bills from the accountant.
You'll save time and money and be more confident about your venture.
26. Do I need any special insurance?
There are many different types of insurance but
you definitely need a garage owner's liability policy. You should
sit down with an agent and figure out what types of coverage you'll
need.
27. What is the minimum coverage
that I'll need?
You should make sure you have fire, liability insurance,
automobile insurance and theft insurance to name a few.
28. What if I have one or two
employees?
If you hire some employees, you'll need to get
Workers Compensation insurance. This type of insurance varies from
state to state. An insurance agent can help you research the requirements
in your particular state. But you must have workers compensation
insurance.
29. What other types of insurance
should I explore, such as business interruption insurance?
Business interruption insurance will cover any
of your expenses while your business is shut down due to a power
failure, a fire or any other predicament. This insurance will pay
your taxes, your utility bills, taxes, and salary to any employees.
30. What is crime insurance?
This will cover you in the event of a robbery or
a burglary. It also covers thefts by employees.
31. Can I get liability insurance
for the detail business?
Yes, you can. You are offering a service, so you'll
want to look into "errors and omissions" insurance, which will protect
you should something go wrong with the service you offered.
32. What should I know when
I go to buy a computer- I'm a novice?
Bring this checklist along: Is the salesperson
and the store trustworthy and reputable? Will they train you? Can
you understand the basics of the unit they are showing you? Does
it come with software that teaches you at home how to use the computer?
Can you phone in questions to the shop or to the manufacturer? Does
it have enough memory for all you need to store? Do you like the
way the type appears on the monitor? Is the keyboard easy to work?
If you don't need a laser printer, don't buy one. Get a less expensive
inkjet printer from Hewlett Packard.
33. Where can I find out about
inexpensive software programs?
Go to your local software store and peruse the
shelves. Also, talk to other small business owners and pick up a
few magazines on software options. You can also download free software
from the Internet.
34. What type of checking account
should I open?
You should open a separate business account. This
will be required if your business operates under a name other than
your own. When you visit the bank, ask them the following: Is a
minimum balance required to open an account? Are there hefty stop-payment
fees on checks? How much do they charge for checks that bounce?
Does the bank offer overdraft protection? Are service fees charged?
Is there a fee on different transactions? Is over draft protection
offered?
35. How should I choose a name
for my business?
Make sure you choose a name that will work tomorrow
as well as work today. Be sure to do a servicemark and a trademark
search both on a national and statewide basis to see if another
company has the name you choose. If you don't do this, the company
who registered before you can demand you stop using the name. This
can cost thousands of dollars to redue signs, brochures, letter
head, etc.
36. I've found a name but need
a logo for my business card. I can't afford a designer. What should
I do?
There must be dozens of artists in your community
or students at a local arts or graphics design school that would
love to design your logo. We know of one detailer who paid $35 for
a design from a local student. The student benefited, too. He got
to put the piece of work in his portfolio. In fact, the NIKE Swoosh
was designed for $35.00.
37. What about signs?
Before spending a dime on signs find out what the
local codes are regarding signs.
38. How should I choose a detail
supplier?
Make a list of companies who can supply your business.
Spend some time on the phone with these people and see if you get
along both professionally (if you like their attitude) and personally
(if you like their manner on the phone). Then have them come out
and demonstrate their products and services. Go with a company who
will give you service. Help in all areas-technical, advertising,
etc.
39. Most people say that businesses
fail because they lack sufficient funds. True or false?
True, most businesses do fail because they lack
enough money to keep the business up and running until the profits
start rolling in. You should have enough money to sustain your personal
expenses and the business for at least 6 months.
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