Business startup

[Shorts]

Anyone used 1and1.com? I've seen their 2 page spread in magazines and looked at their site. A friend of mine who knows computer stuff better than I said their plans looks reasonable enough if the service is up to par.

[GregGaub]

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[Bree]

There's been some previous discussions on the aspects of becoming a business, and how to go about that, or at least things to consider. You might try a search here on the forum.

The LLC, IMO, is a smart move. Depending on what you're doing, a simple sole-proprietor set up will work. But for businesses that are making a product that has some amount of liability tied to it, an LLC is the wiser choice. When I started a basic leathercraft business, I did the sole proprietor; when I started making holsters, I changed it to an LLC. Depending on the set up of that LLC in the state you're in, it most likely will look very much like a sole proprietor business. There's also tax advantages to being an LLC. And at the point you reach a certain income level, you can change your tax status to an S-Corp, which will bring you greater tax advantage. More paperwork/accounting, but it puts you in a better position. Yes, I have an accountant who does the work for us. I would not even want to be the one putting the numbers together. I provide her the information, and she puts it in the proper place. She offers suggestions on occasion, such as, "Kevin, you need to pay attention to this aspect. You're not putting enough money here (or there)."

With respect to the website, it's critical in today's business environment. You'll be dead in the water without one. Keep it current, keep it fresh, and keep it as simple to navigate as possible. Don't make a potential customer go through 14 windows/clicks of the mouse to find out what color options are available. Our site is hosted by Go-Daddy. Have been with them for about 4 years now, and have never had a problem. I pay about $250/year for the hosting and quite a few other accessories. I have another person do the updates to our site. I determine the content, text, etc., and provide that information to him. He makes the changes and uploads the new data.

Hope this information helps.

This is excellent advice. Kevin is 100% correct when he draws the distinction between the Sole Proprietorship (SP) and the LLC or other forms of incorporation. The SP is easy to administer. It is the simplest and most direct form of operating a business. But all your personal assets are on the line. A judgement against your business is a judgement against you personally.

The instant that you start creating a product or performing a service where there is some significant chance of a liability judgement against you, start looking to change the form of your business. LLC (Limited Liability Company) is a great way to go for small businesspeople. It allows you to in effect select your method of taxation and form of organization. In NY you can elect to be treated as an SP, partnership or corporation. It is very flexible. The key benefit is protection of personal assets from liabilities incurred by the business.

Each state is different so you need to check your own state. Some states have special taxes or fees which basically charge you for the right to operate without liability. Still that protection is very valuable.

Websites are another story. Kevin is also correct in his advice... current, fresh, simple. I'll just add one thing. Avoid allowing a developer to turn your business website into his/her programming art showcase. This is all too common and hard for the business owner to stop in advance since you don't know it's happening until it is complete. After all most of us are experts in leatherworking and not web programming.

The way to avoid this problem is to be crystal clear in communicating exactly what you want out of your website. Communicate that this is a business website whose sole function is to achieve your business purposes. Lay out precisely what those purposes are. Make it clear that you don't care about the latest state of the art programming (unless you really do). You want a reliable, stable, and solid site that works for your customers.

Let the developer know who your customers are. If they are technologically well-informed and advanced then you can be more advanced. If they are still using IE4 or other old browsers, then your site will have to be quite rudimentary as far as the latest and greatest goes.

The key thing is to remember that you are in control. Exercise that control. Know what you want and don't settle for less. Business is business and not an exercise in Photoshop art or demonstrating the latest programming technique.