How to create an invoice
Last Updated: 7 July 2016
If you re providing a tax invoice, there are some things you need to include on it for it to be valid. Ensuring your invoices are correct and complete will help you claim your full tax entitlement.
Custom designed invoices
Voluntary standards apply to the layout of tax invoices to help make it easier for your customers to locate important information. If you plan on creating a custom design for your invoice, it s recommended that you follow these voluntary standards as a guide.
Features such as business logos, paper colour, font style, advertising and other additional content on your invoices are not affected by these voluntary standards.
For regular invoices (not tax invoices), it s recommended that you also use these standards as a guide, though you re not required to do so.
What to include in a tax invoice
Tax invoices must include at least seven pieces of information to be valid. Depending on the value of the invoice and what was sold, there may be more requirements.
For sales of less than $1 000, the seven details are:
- The words Tax Invoice must be used preferably at the top.
- Your identity as the seller, such as your business name or trading name. Contact details are optional, but recommended.
- Your ABN or ACN.
- The date the tax invoice was created.
- A brief description of the items sold, including quantity and price.
- The GST amount (if any) payable. You can display GST for each item in a separate column, or within the total price. If you choose not to display it separately, use a statement such as Total includes GST as this is needed for the next detail.
- The extent to which each item sold includes GST. You ll meet this requirement if you either:
- show the GST amount for each item
- clearly state that the total price includes GST.
Tax invoices for sales of $1 000 or more also need to show the buyers identity or ABN.
Examples of tax invoices
Check out the ATO s website for examples of tax invoices, including examples for the following scenarios:
How can I send my customers their invoices?
The way that you provide your customers with invoices is generally your decision. Depending on the circumstances, you could choose to send your invoice via post, fax, email, printable web page or provide it face to face.
Regardless of which method you choose, sending the invoice at the time of purchase is recommended to encourage prompt payment. If your customer requests a tax invoice from you, there is a requirement that you provide it within 28 days of the request. Your method of delivery should take this into account.
The method that you choose must also allow for record keeping requirements to be met.
Record keeping requirements
By law, you re required to keep business records for at least 5 years. Whether you keep printed or electronic records is up to you.
You need to keep all invoices for income you ve received and payments you ve made to others. These will help you prepare your Business Activity Statement (BAS), income tax return and other tax obligations.
Check out the ATO s Manage your invoices, payments and records for more information on these requirements.
Dealing with unpaid invoices
There are a number of ways that you can deal with unpaid debts and customer disputes. Read our managing unpaid debt page for helpful tips and resources.
You can also check out our case studies on payment disputes for independent contractors.
What happens if the tax invoice is incorrect?
If the tax invoice you sent is incorrect or incomplete, it s not a valid tax invoice. You ll need to replace it with a complete and correct tax invoice.
If you receive a tax invoice with missing information, you can still treat it as a valid tax invoice if you re able to find the information within other documents the supplier has given you. Alternatively, ask for a new one with the correct information.
Tips for invoicing
By following some simple tips, you can help boost your cash flow and reduce the risk of unpaid invoices. Try the following when sending your next invoice:
- Include your payment terms on the invoice and ensure your customer is aware of them. For example, requiring payment to be made within 30 days of receiving a correct, valid tax invoice.
- Be timely and predictable. Being prompt when sending your tax invoice ensures that you re paid as soon as possible. If you need to send invoices on a regular basis, try sending them at the same time of day so that your customer knows when to expect them.
- Offer a variety of payment options and state these on your invoice.
- Try sending your invoices via email. It can decrease the chance of your invoice being lost in the mail and help encourage a prompt payment.
- Be detailed in your item description field. Being detailed and providing a full account of the product or service you provided can help reduce the chance of a dispute.
What to do.
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Zee Business: Go local, get an audience
Shuchi Bansal | New Delhi May 05, 2009 12:42 AM IST
Zee Business, the business news channel of the Zee Group, has increased its market share almost 100 per cent in the last one year. Launched in November 2004, it was the country s first Hindi business channel. However, it failed to make a mark. Up until one year ago, the channel lacked direction and a clear positioning. With a market share of approximately 11 per cent, it trailed CNBC, CNBC Awaaz and NDTV Profit by a huge margin.
Last summer, the channel s new business head, Raktim Das, went back to the drawing board to see how he could drive channel viewership. The problems were aplenty. We did not even know who we were talking to. However, what we knew was that business leaders like Ratan Tata or Nandan Nilkeni were not talking to us, says Das.
Step one included defining the core audience and the core positioning of the channel. Since purchasing power was growing in Tier II and III towns, it was decided to focus on small and medium enterprises of up to Rs 100 crore, especially those in the Hindi-speaking markets.
So, the spotlight turned on towns like Moradabad (for its crystal and brass exports), Agra (leather), Ludhiana (wool products and hosiery) and Jaipur (gems and jewellery). To connect with the audience in these towns, Zee Business began organising investor camps.
Zee held 30 such camps where an expert panel talked to people about their financial planning and investment needs. Simultaneously, it launched a hunt for smart investors in these towns who were meant to resolve case studies in financial planning. Selected viewers were shot with their families for an on-air show.
The exercise has been on for the last nine months and has created a huge rapport with the viewers. The grand finale of the contest is yet to be held, says Das. In another ground event, the channel organised discussions on emerging businesses in 10 cities. Result? Its viewership has risen from 11 per cent in March 2008 to 19 per cent in November to 25 per cent between January and March. Das claims Zee Business is now ahead of NDTV Profit and UTVi.
#atm machine business
How Much Can an ATM Machine Make
How much you can earn in the ATM Business depends on where the ATM is located and if it is needed. The main thing to remember about the ATM Business is that it’s just like real estate. Location, Location, Location.
ATM’s can be installed anywhere in the USA. Inside or outside any retail merchant location including but not limited to Restaurants, liquor stores, convenience stores, fast food restaurants, quick service restaurants, casual dining, bars, night clubs, train stations, football or baseball stadiums, concert venues, adult themed locations, Hotels, Hospitals, Condo complexes, Apartment Complex, High Rise Apartment Buildings, coffee carts, mobile events, mounted in trailers, mounted on the back of food trucks, you name it. Anywhere people need access to cash, an ATM can make you a passive income .
If you answer yes to any of these questions, Get our new book The Amazing Money Machine on Amazon now.
- I m a retail merchant looking to increase profits.
- I m an entrepreneur looking for a new business opportunity.
- I m an investor looking to diversify and maximize annual returns.
- I already operate an ATM Business and I want to put more money in my pocket.
- I m an individual looking to make some passive income and would like information about the ATM Business.
- I m an individual, business owner, or part of a group that has locations that need ATMs.
How much can an ATM make?
Well, It’s all about foot traffic, a reason to need money, and other available payment methods. Sometimes just having a lot of people walk by or see the ATM can mean the difference between a good
The ATM Industry has a “rule of thumb” formula that many Independent ATM Deployers “IADs” use as a general rule to determine if a location would be a good candidate for an ATM machine. There are two different schools of thought on this rule, and obviously since there are many unknown variables, no location is a guarantee using these formulas but it’s better than a WAG (wild ass guess).
- The first rule of thumb, or formula says that 3 – 5% of people that actually see an ATM machine in an establishment will likely use the ATM. Say for example, your location has an average of 200 customers visiting each day. One would expect, or speculate that approximately 8 of those 200 people would use that ATM daily.
- You could then take those 8 people, multiply it by the amount of surcharge, then take that figure and multiply it by the number of days of business (how many day’s the location is open) in the year. This will give an ATM owner, or perspective owner, an estimate on how much revenue could be generated from the machine in a year’s time.
- However, most ATM business owners want to calculate monthly revenue and income.
- The 2nd rule of thumb follows the norm that the number of adult patrons an establishment has in a given day, that same number plus or minus 10% will use the ATM on a monthly basis. I prefer this rule of thumb and if the establishment accepts credit cards or gives cash back at the point of sale (POS), the lower end of the rule would apply and it might even reduce the number by as much as 20% – 40%.
- A similar formula is used for hotels or big commercial buildings. With hotels, we take the number of rooms, times the occupancy rate and apply the same plus or minus 10% rule. So if the hotel has 150 rooms with an 80% occupancy rate one might expect 110 – 135 monthly transactions, however if the hotel has any events or banquet rooms, that number would scale higher during those times.
- Similarly with commercial buildings (office building for example) you might take the total number of employees working in the building and using the yearly formula based on how many days a year the companies occupying the building are open. If there is a cafe or for profit cafeteria in the building the estimates would be higher.
Think about it this way. Some of the best locations are where there is a high need for cash and no credit cards are accepted. Swap meets, events, and street fairs, are all great but very temporary. That would be a mobile ATM business which we can also show you how to operate.
We’ll try to boil this down and make it simple. At the very least, if you’re a retail merchant, and you don’t already own an ATM, you could purchase the hardware from anyone (even from us) and once you set up the ATM processing it should at least pay for itself in as little as a few months.
You’ll also need a communication method so the ATM can talk to our processing center. You can choose from a dedicated standard phone line (but since it calls a toll free or local number you’ll just have the cost of the line, no tolls), Internet Service (if you have a high speed model or DLS with a router, you can hard-wire the ATM to your current internet), or you can choose our wireless cellular service which is often less expensive than a phone line and lightening fast.
With the advent of VoIP and certain devices if you have a computer close to the ATM you could potentially use a Magic Jack or other device as long as the ATM can hear a dial tone or pre-dial to get a tone (like dialing a 9, although not as reliable, it would still work). However, intermittent communications can cause more problems that they save you. If there is an issue with communications, transactions could be slow or worse they could be interrupted and customers would not receive money from the ATM getting upset.
If you have a fast internet connection and you purchase one of the new ATMs which includes internet processing, or get a separate wireless device ATMDepot can handle the rest for you. In order of ranking communications as far as ease, cost, and reliability.
- Wireless Device is preferred and is the most reliable.
- Next would be your own Internet service with a hard wire to the ATM Machine.
- Lastly, a standard Dial up Phone line, but this method causes the most communication issues.
If you don’t have an ATM or are considering getting into the ATM business to earn some extra cash or a passive income, you just need to be sure that a minimum of at least 3 – 4 people per day would use the ATM every day (if available 7 days per week).
Obviously if you’re a retailer and are open 10 hours a day that’s just one person using the ATM every few hours. If you’re considering a through the wall machine that faces outside it will be available 24 hours a day but those machines need at least 8 – 10 people per day to make financial sense.
If you already have an ATM or are already in the ATM business and are looking to switch your ATM processing services (you need to check your current ATM agreement for termination clause) you could take advantage of our higher revenue sharing without any costs to you and put more money in your pocket.
If you don’t have an ATM, you can review our ATM Machine equipment options or call us for advice.
Let’s say for example you purchase the new Hyosung Halo. You can install it yourself, but we recommend you let us arrange to have a professional install it and train your staff. This ATM can use wireless communications technology which is under $20/mo so no phone line is required.
We also have a Triton ATM for under $2,500 and carry the full line of Hantle and Genmega ATMs. You will probably invest between $2,250 – $3,500 in good ATM machine by the time you’re done with professional installation, signs, or anything else extra you may want for your ATM Business.
An Overview Of Corporate Bankruptcy
If a company you’ve got a stake in files for bankruptcy, chances are you’ll get back pennies to the dollar. Different bankruptcy proceedings or filings generally give some idea as to whether the average investor will get back all or a portion of his investment, but even that is determined on a case-by-case basis. There is also a pecking order of creditors and investors of who get paid back first, second and last. In this article, we’ll explain what happens when a public company files for protection under U.S. bankruptcy laws and how it affects investors.
Two Major Types of Bankruptcy
The U.S. Securities and Exchange Commission states that under Chapter 7 of U.S. Bankruptcy Code “the company stops all operations and goes completely out of business. A trustee is appointed to liquidate (sell) the company’s assets, and the money is used to pay off debt”. The investors, or creditors, who take the least risk are paid first.
For example, investors who take a relatively reduced risk in the company by purchasing corporate bonds must forgo the potential of seeing any excess profits the company may earn in the future. For the higher safety of the bonds, the investors agree to receive, at most, their specified interest payments. Equity holders, however, have the full potential of seeing their share of the company’s retained earnings. which would be reflected in the stock’s price. But the tradeoff for this possibility of boosted returns is the risk that the stock may lose value. As such, in the case of a Chapter 7 bankruptcy, equity holders may not be fully compensated for the value of their shares. In light of the risk-return tradeoff. it seems fair (and logical) that shareholders are second in line to bondholders when a bankruptcy does occur.
Secured creditors. who are even more risk-averse than regular bondholders, accept very low interest rates in exchange for the added safety of corporate assets being pledged against the company’s debt. Therefore, when a company does go under, secured creditors receive priority and are paid back before any regular bondholders begin to see their share of the pie. This principle is referred to as absolute priority. (For more insight, read the Stocks Basics Tutorial .)
This proceeding of the U.S. Bankruptcy Code involves the reorganization of the debtor ‘s business affairs and assets. The company undergoing Chapter 11 expects to return to normal business operations and sound financial health in the future. It’s generally filed by corporations that need time to restructure debt that has become unmanageable. Chapter 11 gives the debtor a fresh start, which depends on the debtor’s fulfillment of obligations under the reorganization plan. A Chapter 11 reorganization is the most complex and, generally, the most expensive of all bankruptcy proceedings. It is therefore undertaken only after the company has carefully analyzed and considered all alternatives.
Chapter 11: The Drink of Choice
Public companies tend to try to file under Chapter 11 rather than Chapter 7 because it allows them to still run their businesses and control the bankruptcy process. Rather than simply turning over its assets to a trustee, a company undergoing Chapter 11 has the opportunity to restructure its financial framework and be profitable again. If it fails, all assets are liquidated and stakeholders are paid off according to absolute priority.
Keep in mind that Chapter 11 isn’t a get-out-of-jail-free card. When a company files for Chapter 11, that company is assigned a committee that represents the interests of creditors and stockholders. This committee works with the company to develop a plan to reorganize the company and to get it out of debt, reshaping it into a profitable entity. Shareholders may be given a vote on the plan, but as their priority is second to all creditors, this is never guaranteed. If no suitable reorganization plan can be prepared by the committee and confirmed by the courts, shareholders may not be able to stop their company’s assets from being sold off to pay creditors. (For related reading, check out Finding Profit In Troubled Stocks .)
How It Affects Investors
As an investor, you are between a rock and a hard place if your company faces bankruptcy. Clearly, nobody invests money into a company, whether through its stock or its debt instruments. expecting the company to declare bankruptcy. However, when you venture outside of the risk-free realm of government-issued securities, you are accepting this added risk.
When a company is going through bankruptcy proceedings, its stocks and bonds usually continue trading, albeit at extremely low prices. Generally, if you are a shareholder. you will usually see a substantial decline in the value of your shares in the time leading up to the company’s bankruptcy declaration. Bonds for near bankrupt companies are usually rated as junk.
When your company goes bankrupt, there is a very good chance you will not get back the full value of your investment. In fact, there is a chance you won’t get anything back. Here is how the SEC summarizes what may happen to stock- and bondholders during Chapter 11:
“During Chapter 11 bankruptcy, bondholders stop receiving interest and principal payments, and stockholders stop receiving dividends. If you are a bondholder. you may receive new stock in exchange for your bonds, new bonds or a combination of stock and bonds. If you are a stockholder, the trustee may ask you to send back your stock in exchange for shares in the reorganized company. The new shares may be fewer in number and worth less. The reorganization plan spells out your rights as an investor and what you can expect to receive, if anything, from the company.”
Basically, once your company files under any type of bankruptcy protection, your opportunities and rights as an investor change to reflect the bankrupt status of the company. While some companies do indeed make successful comebacks after undergoing restructuring, you need to realize that the risks you accepted when you invested in the company can become reality. And if your stake in the pre-Chapter 11 company ends up being worth anything in the restructured firm, chances are it won’t be as much as it was when you first entered your position and it won’t be in the same form.
During Chapter 7 bankruptcy, investors are considered especially low on the ladder. Usually, the stock of a company undergoing Chapter 7 proceedings is usually worthless, and investors lose the money they invested. If you hold a bond, you might receive a fraction of its face value. What you receive depends on the amount of assets available for distribution and where your investment ranks on the priority list on the first page.
Secured creditors have the best chances of seeing the value of their initial investments come back to them. Unsecured creditors and shareholders must wait until secured creditors have been adequately compensated before they receive any compensation for the loss of their higher-yielding investments. Because equity owners are last in line, they usually receive little, if anything.
From an investor’s point of view, there isn’t much good to say about bankruptcy. No matter what type of investment you made in a company, once it goes bankrupt you are probably going to get a lower return on your investment than you once expected. As an individual investor, you don’t have any more say in a company’s restructuring plan than you do in any other corporate actions on which shareholders vote.
In general, Chapter 11 is better than Chapter 7, but in either case you shouldn’t expect much of your investment back. Relatively few firms undergoing Chapter 11 proceedings are able to be profitable again after a reorganization; even if they do become profitable again, it is not a quick process. As an investor, you should react to a company’s bankruptcy the same way you would if one of your stocks took an unexpected dive: recognize and accept the dramatically reduced prospects of the company, and ask yourself whether you still want to be invested in the company. If the answer is no, let go of your failed investment – holding on while the company undergoes bankruptcy proceedings will only lead to sleepless nights and perhaps even greater losses in the future.
#incorporating a business
Why Incorporate ?
Choosing how a business is organized may be one of the most important decisions a business makes. Incorporation may be the wisest decision, but for some, it may be an unnecessary decision, and so each business should carefully assess the benefits (and challenges) of incorporation before moving forward. With that said, the greatest benefits to incorporation can be summarized into the 3Ls: Life, Liquidity, and Liability. Let’s start with Life.
The best way to understand a corporation is to imagine it as a separate artificial person (with limited rights and privileges). Incorporating a business is essentially creating that separate person thereby making the business separate from the owner (in a sense, the business has a life of its own). As a separate entity, the corporation exists independent from the shareholders/owners and its employees. Regardless of what happens to the shareholders, or the directors, or the employees, the corporation itself continues to exist in perpetuity until a time the directors and shareholders decide to dissolve a corporation. In a sole proprietorship or general partnership where the owner(s) is the business, what affects the owner may affect the business. Any personal debt or liability of an owner or partner allows the creditor(s) to pursue the assets of the business whether or not the debt or liability has any relation to the business itself. Furthermore, personal bankruptcy of an owner or partner will directly impact a business by opening up its assets to any creditors the owner or partner is liable to. By incorporating a business. the personal finances of an owner or partner remains separate from the finances of the corporation and allows the business to continue without disruption. In the event of an unfortunate death of an owner or partner, the business is generally dissolved regardless of the wishes of the owner or partner(s). All of this could easily be avoided by incorporating the business as a separate entity.
As much as we believe that all owners of a business should remain forever committed to the success of the business, there may be times when an owner or partner will need to leave the business. Regardless of the reasons for leaving the business, incorporation allows the free transferability of interest from one person to another. Generally in a partnership, a partner cannot transfer his/her interest in a business to another without the express consent of all other partners. If a partner still decides to leave the partnership against the will of the other partners, the partnership is automatically dissolved. Incorporating a business removes this limitation by allowing shareholders/owners to freely transfer his/her interest to another without the unanimous consent of all other shareholders. Small businesses may see the restrictions against transferring shares as a good thing and may want to control how a shareholder may transfer his/her interest and to whom. Incorporation allows this flexibility as well. The free transferability of shares is a default rule, but by no means is it mandatory for all incorporated businesses. Businesses have the option to place restrictions on the transferability of certain shares and so even if this benefit of liquidity may be seen as a detriment to a business, incorporation lets the business decide whether or not to take advantage of this option. More importantly, unlike a partnership, incorporation prevents the ability of a minority shareholder from dissolving a business without cause.
One of the greatest benefits for incorporation is its limited liability against the shareholders. As mentioned above, any debt or liability against a specific shareholder remains separate from the corporation. Likewise, the inverse is similarly true. Any debt or liability against a corporation does not open the doors of shareholders’ assets to the creditor(s). The shareholder’s liability in any corporate debt or liability is limited to what the shareholder invested (unless there is fraud). In a sole proprietorship or general partnership, the owner(s) and/or general partners remain completely liable to any debt or liability placed against the business. If a business is unable to pay a debt, the creditor can attack the assets of an owner or partner until the debt is satisfied. In a corporation, a creditor can only attack to the extent the shareholder invested into the corporation (unless there is fraud). This allows the corporation to make business decisions without the risk of endangering the personal assets of its shareholders beyond what was invested. Risk is a necessary element to a successful business. Anything that minimizes the risk to investors makes the business more attractive, and so the limited liability of an incorporated business is quite valuable.
The major detriment to incorporation is the taxes involved. In a sole proprietorship or partnership, the taxable income of the business flows directly to the owner and/or partners and are taxed based upon the individual’s income tax bracket. However, because the corporation is considered a separate entity, the taxable income of a corporation is taxed first under a corporate tax. If the corporation decides to distribute the remaining income to the shareholders, that income is taxed once more based upon the individual’s income tax bracket (essentially, a double-taxation). The marginal tax rate for a corporation can be significantly higher than the marginal tax rate for a sole proprietorship. Although this characteristic of incorporation may deter a business from incorporating, small businesses can avoid this double-taxation by taking advantage of the options given to a corporation by the states. Some options include incorporating as an S-corporation (see below) or filing as a Limited Liability Company (LLC) (see below). These options allow the taxable income to flow directly to the shareholders/members without being taxed twice, while at the same time, maintaining the benefits of incorporation. The 3Ls are important benefits, but not the only benefits. There’s also something psychologically beneficial about incorporating that goes beyond the number crunching and legal issues involved. Incorporation may seem to be a daunting task, but it is also an exciting moment in the life of a business. First conceived through an idea, a business can be birthed at the point of incorporation. No longer will it simply be an idea or something intangible, but an actual and existing entity. Sometimes this psychological step of seeing the business as something real will further motivate and inspire you to bring greater success to your business.
Reduced Chance of Tax Audit
Sole proprietors tend to be more likely to file incorrect returns (many are self-prepared). and tend to under report revenue or over report deductions. For these reasons, the IRS has audited a much higher percentage of sole proprietor tax filings than corporate filings in recent years. In tax year 2006, a Schedule C filer stood a 1 in 32 chance of being audited. For non-business filers, the odds were around 1 in 124. This means that sole proprietors are significantly more likely to be audited.
Distinguishing yourself from the competition by establishing a professional identity helps increase credibility with your customers. Most businesses choose to incorporate a business to prove their legitimacy to both customers and suppliers. Adding “INC.” or “LLC” after your business name gives you the credibility and professionalism that many customers are looking for.
You could file all the necessary incorporation documents yourself. However, when you consider the time involved for filing, administering, and maintaining all the documents necessary to keep your business running legitimately. why would you? Let us help you get it done, so you can get back to business!
- Forming a business with MyCorporation is a cost-effective way to protect personal assets and gain potential tax savings.
- Our incorporation services start at just $69 (plus required government fees).
- Lawyers charge, on an average, over $200 per hour. With our document filing services. you’ll know exactly what you are getting, and how much it costs from the very beginning.
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#import export business
How To Start An Import/Export Business (Part 1 of 2)
Updated August 07, 2016
So you want to sell to the world? You’ve come to the right place. Thanks to the Internet, setting up an import/export business can be ridiculously simple and very profitable. Here are ways to make it happen.
• Select your business name and set up a website and blog.
Without a website or blog, you can t have a networked import/export business. Get yourself a platform that allows you to develop a presence online and grow your business beyond your wildest imagination.
The goal is to balance the flow of communications, sell products online (or offline) and build your customer base to drive profits for your international business.
But first, remember to register your business name with a reputable web host because your domain name is what customers use to find you and your business. And it can’t hurt to consult with an international lawyer, banker and accountant for advice on establishing a virtual import/export business and keeping it in the best legal and financial position possible.
A couple of places to get started with a website are Network Solutions. Go Daddy. Intuit and Verio. All offer domain name registrations and affordable website hosting packages with easy-to-use site building capabilities.
To create a professional blog, which allows a continuous flow of engaging communications, try Blogger. Typepad or WordPress. These services allow you to create a blog in minutes with stunning designs, reliable hosting and on-demand tech support.
Now you are ready to share your business expertise and capabilities and sell to the world.
• Pick a product to import or export.
When it comes to importing and exporting, you cannot be all things to all customers. Decide on something and stick with it.
You have two viable reasons for choosing a product to import or export: you know it will sell or you like it.
Hopefully, you can meet both criteria. That’s an ideal business model. Would you buy it if you saw it in another part of the world? Then you are on to something!
• Find the right market.
You’ve selected a product, now you must look for someplace to sell it! You will improve your odds of picking a winner if you cultivate a knack for tracking trends, or even spotting potential trends. Getting in on the ground floor and importing or exporting a product before it becomes a super-seller in a country could be the business breakthrough of a lifetime!
Do the homework and research the market beforehand to locate the best potential foreign market for your product or service. Two places to check are The World Bank’s Ease of Doing Business and globalEDGE’s Market Potential Index.
You might also check with local government officials to best determine sources for conducting market research. For example, in the United States, there are the Department of Commerce International Trade Administration’s Data and Analysis and the U.S. Census Bureau Foreign Trade. which governs the reporting of all import/export statistics.
These resources are helpful for determining where in the world products and services are moving to and from, and why and how to get in on the action.
Once you have a likely import or export product in mind, learn everything there is to know about it. If you were its creator, how would you improve it? Go to a manufacturer and suggest product improvements to turn a mediocre product into something slightly ahead of its time. Your suggestions might mean the difference between a Sony Walkman and an Apple iPod.
The easiest access to reputable suppliers might be Alibaba. Global Sources. and Thomas Register. There are others, but these three are considered the holy grail to finding high quality suppliers. manufacturers, exporters, importers, buyers, wholesalers and trade leads.
In continuation to our first installment which covered how to start and map out an import/export business, here we provide the sales and distribution aspects of establishing an import/export business.
The business model for an import/export business is based on two critical elements within the international sales operation.
1. Volume (number of units sold).
2. Commission on that volume.
The goal is to price your product in such a way that your commission (markup on the product to customers) does not exceed what your customer is willing to pay and offers you a healthy profit. Typically, importers and exporters take a 10% to 15% markup over cost, which is the price a manufacturer charges you when you buy a product from them.
The more you sell, the more you make. Keep your product pricing separate from logistics because, at some point, you combine the two to determine a landed price per unit. A good transportation company can assist here. Don’t let this part intimidate you!
Provided you have done a good job with search engine optimization on your blog or website, customers will find you. But don’t rely on it. You should also go hunting for customers! Check with local contacts, such as trade organizations, Chambers of Commerce. embassies and trade consulates. They generally have a good sense of who’s doing what in the international marketplace. They can offer contact lists specific to your industry and also suggest trade shows that are taking place locally and internationally that might help you connect with customers in a faster and more efficient manner.
An excellent service on the exporting end is the U.S. Commercial Service (CS) Gold Key Matching Service. The U.S. CS can help you find potential overseas agents, customers, distributors, sales representatives and business partners.
At the same time, work your social media and networking platforms (your blog, Facebook, LinkedIn and Twitter) by posting information about your product or service and asking specific questions about your audience s needs. This gets the conversation going and keeps it going while making sure it s related to your business. The point is to keep your business on the minds of potential customers worldwide.
• Transport your products.
Your next step is to focus on logistics — transporting the product to where you will be selling it. By now, you have located a customer who loves your product, solidified the terms of the sale with them and established a means for getting paid. Now you must move your product.
Hire a global freight forwarder who serves as an all-round transport agent for moving cargo, typically from a factory door to another warehouse. Their service saves you a lot of time, effort and anxiety for a very reasonable fee. Based on information you provide, they take care of all shipping arrangements, which includes but is not limited to handling documentation, arranging insurance, if requested, and determining necessary licenses, permits, quotas, tariffs and restrictions (country regulations). which can be one of the most complicated aspects of importing/exporting for a newbie international trader.
You can find freight forwarders online under “transportation,” or check listings in trade magazines or other international handbooks. Pick two or three that seem like a good fit for your product or shipping destination.
Two well-known companies that are eager to work with brokers, consultants and small businesses are UPS and Fed Express. Either can also assist with getting paid, a critical part of the international sales process.
• Provide great global customer service!
The relationship between you and your overseas customer shouldn t end when a sale is made. If anything, it requires more of your attention.
Think of your after-sales follow-up on your import/export business as part of your product or service offering. The first step is to say, wholeheartedly — whether in person, via Skype, by email or telephone — Thank you for your business! For more on this, take a look at “How to Provide Great Global Customer Service” .
Congratulations! You have officially learned the fundamentals on how to establish an import/export business. Now start booming and go make the world your business!
#small business owner
Are You a Small-Business Owner or an Entrepreneur?
December 10, 2015
The Difference Is Important
It’s National Small Business Week. Hooray! Small businesses are the backbone of this country. They create jobs, come up with new ways of doing old things, and help keep money in the local community. Without small businesses, we’d be in a bigger economic mess.
Among those of us with small businesses, there’s confusion between the terms Small-Business Owner and Entrepreneur. Both can have small businesses, but they have different styles of leadership and thoughts on running their business. One is not better than the other, they’re just different. How do you fit in to these 4 scenarios?
Small-business owners have a great idea.
They solve a problem in their community. They know their business and target audience. They know what will make their customers happy. They serve their customers.
Entrepreneurs have big ideas.
They dream big. They think big. They come up with ideas that haven’t been tested, diagnosed, or worked through. A lot of times they don’t even know if their ideas are possible, which gets them even more excited.
Small-business owners hold steady.
They like to know what’s coming next and where it’s coming from. They make calculated decisions where the outcome is clear. The result may not be huge, but it will typically keep them moving forward.
Entrepreneurs love risk.
They step out on a ledge more often than not. They jump in with both feet knowing that if they put in their full effort, the risk will be worth it more often than not.
Small-business owners think about the things they need to finish this week.
They have daily and weekly to do lists. They manage employees, work with customers, network with new customers, and keep everything rocking and rolling.
Entrepreneurs are thinking ahead six months.
While their team is thinking about what they’re doing that week, they tend to skip the now and focus on the future of the company. They have people to manage the business, and if they don’t, they soon will.
Small-businesses owners are sentimental with their businesses.
They never plan on selling or handing their business off to someone else unless it s family. They like making the decisions and running the day-to-day.
Entrepreneurs focus on scaling.
They want to grow and grow they will. Although they may not focus on selling the business, they set it up to run without them. They surround themselves with experts while they end up being the rainmaker.
America needs small-business owners to hold the economy and entrepreneurs to propel it forward. One isn’t better than the other. But the question needs to be asked: Are you a small-business owner or an entrepreneur?
#small business banking
Help me choose
a Business Bank Account
i The monthly Business Banking Plan transaction limit includes cheques negotiated and other debit or credit transactions to the account including deposits, withdrawals, electronic credits and debits, bill payment debits or debit card debits and credits.
ii Standard deposit contents fees will be waived on each month’s deposits up to these limits.
iii The monthly Business Banking Plan fee can be eliminated by maintaining the minimum monthly balance at all times in a Business Account. Customers are responsible for all other fees relating to any transactions, services and products not included in the Business Banking Plan. The minimum balance waiver is only eligible for customers with the Business Builder 3 and 4 Business Banking Plans.
1 Subject to interruptions in telecommunications or online systems or in power supply or any other factor or event beyond the control of Bank of Montreal.
2 Mobile Banking is only available for customers registered for Online Banking.
3 Electronic transactions exclude transactions completed at a BMO branch or with the assistance of a Customer Contact Centre associate.
4 Assisted transactions refer to those completed with a Customer Contact Centre associate.
5 Although BMO will not charge any fees in addition to your monthly Plan or account fees to access Mobile Banking, additional service fees may be charged by your service provider. Check with your service or hardware provider if you have questions about your specific device.
6 Applies to all deposits posted by Moneris to your BMO business account in connection with your acceptance of MasterCard, Visa*, Interac, Discover* or Union Pay* branded cards and American Express* transactions that are settled by Moneris – including deposit of settlement funds, terminal rental fee, and any other fees. American Express credit card transactions that are not settled through Moneris are not included in unlimited Moneris transactions, and are subject to separate terms and conditions. Standard transaction fees apply. Refer to Moneris Solutions for complete details. All other debit or credit transactions posted to your BMO account related to any other brand of card processed using Moneris services, are not included and may be subject to transaction limits associated with your Plan and/or excess per-item transaction fees. (* Visa, Discover, American Express and Union Pay are trademarks of their respective owners.)
7 Transactions include cheques negotiated and other debit or credit transactions to the account, including deposits (except cash and coin), withdrawals, electronic credits and debits, bill payment debits or debit card debits and credits. Cash and/or coin deposits are subject to deposit content fees of $2.25 per each $1,000 for cash and $2.25 per each $100 for coin.
8 There are no daily or monthly transaction fee limits. A $5.00 per item fee will apply to each transfer.
9 Overdraft limits range from $500 to a maximum of $2,499.99 and are subject to credit qualification.
10 Available in Canadian dollars only.
11 Interest is calculated on the daily overdrawn balance at prevailing overdraft interest rates and charged to the account on the last business day of each month.
12 A $5.00 per item fee will apply to each debit transaction that creates or increases the overdraft up to your approved limit.
13 There are no daily or monthly transaction fee limits. A $5.00 per item fee will apply to each debit transaction that creates or increases the overdraft.
14 This fee is in addition to any applicable transaction fees.
15 You are required to provide initial setup instructions for this service.
16 Interac e-Transfer service may be restricted based on BMO Debit Card for Business privileges.
17 Interac e-Transfers can only be sent from a Canadian dollar business account. Sending an Interac e-Transfer is considered an electronic debit to the account. Excess item or account per item fees may apply. The Interac e-Transfer fee is non-refundable, this includes cancellations. The AgriInvest Account and Business Premium Rate Savings Account are restricted from sending Interac e Transfers.
18 Interac e-Transfers can only be credited to a Canadian dollar account. There is no additional charge to receive an Interac e-Transfer. Receiving an Interac e-Transfer is considered an electronic credit to the account. Excess item or account per item fees may apply.
19 Your Interac e-Transfer send limit may be lower than the posted daily limit depending on the Bill Payment Limit assigned to your BMO Debit Card for Business.
20 BMO self-serve channels include BMO Online, Mobile and Tablet Banking, BMO Online Banking for Business, Telephone Banking (when using the interactive voice response (IVR) sytem and BMO ATMs.
Why Your Business Phones Need an Upgrade
The big issue for business is staying on top of its communications requirements. New technology is driving old phone systems beyond their design capabilities. The need now is for business phone systems which are scalable and customizable to manage real business operational needs.
The simple fact is that the baseline needs of business commercial systems are expanding. They need to be able to do a lot more, and manage much bigger demands. The office in your pocket approach to mobile systems alone is creating a reciprocal need for much better phone systems in-house. The big shift in commerce to eCommerce is adding a gigantic extra load on its own.
The point here is that more business equates to more demand for communications and increasing diversification of the need for different services. The time is long past since the days when a simple phone system of the old type can handle the multi-level range of communications a typical business experiences every day.
If you put all your different communications through a single stream system, the result is a range of obstacle courses. The new approach is to create dedicated servers (also known as private servers in the communications industry) to separate and manage the workloads. This is infinitely more efficient and far more productive than the stunningly slow and seemingly procedurally-obsessed single stream systems can ever be.
Consider this situation:
- A call center receives 5000 calls a day for multiple clients.
- On the receiving end of these calls are specialists, trained to manage specific tasks.
- If these calls are managed on a single stream basis, the result is instant inefficiency. It s an entirely inappropriate system for a big call stream.
- The calls need to be efficiently split up into their proper streams by definition.
This is just a bigger version of the basic issues for any business phone system. Whether you re NASA or a local grocery, you need your calls to get from A to B ASAP. It s impossible to justify the sheer waste of time and money in a phone system which effectively creates delays and a working backlog of business which could and should have been done a lot faster.
Upgrading for Better Business
The new options for telephone systems include two fundamentally different improvements. These are significant upgrades by nature, and they can set up a business system to operate on a fully customized, business-specific configuration with almost no effort required.
- Private Servers: These are the real fixers for any business phone issues. Dedicated servers are not simply more efficient . They re real managers of communications workloads. They improve response times and service quality dramatically.
- Contact Centres: The contact centres will ring more than a few bells with project managers and other businesspeople who know what managing a very diverse range of business operations involves. Contact centres are virtual phone systems, configurable to any operational requirements. They can literally create a working call center out of a box. If that sounds a bit different, you can also see the instant business applications.
Add both private servers and contact centres to your phone system, and you’ve achieved a major upgrade, scalable and appropriate for your business, both now and in future. This is good business, and these are the communications systems of the future.
Kushal Tomar is a valued contributor for CosmoBC’s TechBlog. You can follow him through the buttons below. View all posts by Kushal Tomar