There are 3.2 million fewer jobs in the United States today than it did when President George W. Bush took office, including 2.5 million fewer manufacturing jobs. More than Americans have lost their jobs… and we are counting more every day. According to a Rutgers University, University of Connecticut report, The Disposable Worker: Living in a Job-Loss Economy.In the past three years, nearly one in five U.S. workers was laid off from the job.
In the past three years, nearly one in five U.S. workers was laid off from their job, according to “The Disposable Worker: Living in a Job-Loss Economy” report.
A number of people who have lost their jobs are taking the risk to start their own small businesses. And with an economy in shambles, starting out on the right foot is essential to their success.
Here are some solutions to common costly mistakes made by new business owners:
You may need to register your business — and check directly with the government agency that handles your town because city and state requirements are different, ranging from whether or not you have to charge sales tax to hiring employees. If you do not abide by local and state ordinances you could be tapped with heavy fines,legal action, or your business could even be shut down.
Professional licenses must be maintained — or you could face serious personal fines, or experience lawsuits from practicing without these requirements.
Charge the right taxes — as doing business varies from location to location in sales tax regulations. All but five states charge sales taxes including: Alaska, Delaware, Montana, New Hampshire, and Oregon.
Obtain a unique business name — because trademark laws are often vague, but one thing should be very clear when choosing a company name. Make sure it does not already belong to someone else or you could be in for someone to sue you.
Make sure your company is insured — as typically insurance needs will vary depending on the business, Just make sure you have the types of insurance that leaders in your field recommend because the last thing you need is an expensive liability claim.
Last, one secret to a successful new startup business is known as invoice factoring. This 4,000 year old business tactic is a very simple financial transaction. A business sells its accounts receivables, or their outstanding invoices, to a third party known as a factoring company at a discounted rate in exchange for fast cash with which to finance continued business.
Invoice factoring is an ideal way to ensure business growth. It allows you to manage the cost by selling invoices that will be paid soon and by only taking the amount that is needed for continuing operations.
Invoice factoring is also known as accounts receivable factoring, and it differs from a bank loan in three main ways.Here’s how:
1. The value of the receivables is emphasized and not the firm’s credit worthiness.
2. Invoice factoring is not the same as a loan – Rather it’s the purchase of a financial asset also known as the “receivable” or an outstanding invoice that has not yet been paid.
3. Bank loans involve two parties whereas factoring involves three parties.
In summary, it is important to take the time to set up your business correctly and thanks to using proven business strategies like invoice factoring from the beginning, your business will have a better chance to be successful.