FREQUENTLY ASKED QUESTIONS
VALDOSTA STATE UNIVERSITY
SMALL BUSINESS DEVELOPMENT CENTER
How do I find and retain quality employees?
Many small businesses hire individuals they know or those referred to them by friends and family members. To hire specialized employees, small businesses might work with a staffing agency, headhunter organization, online resume database or simply take out an ad in the classifieds. Retaining employees after hire is very important because of the costs associated with turnover. Employees will stay at their jobs if they are adequately compensated and challenged by their work. For more information on finding and retaining quality people, contact your local SBDC.
How do I put together a marketing plan?
In developing your marketing plan it is important to analyze your current situation to see how you fit into the market. Based on your current target market and target area, it is important that you consider the following factors to include market share, competition, changes in demographics, attitudes, beliefs, norms and advances in technology. It would be useful to conduct a SWOT analysis to in order to ascertain your company’s strengths, weaknesses, opportunities and threats. The analysis should provide you with useful information necessary to define marketing goals and objectives leading to the formulation of strategies aimed at meeting these goals and objectives.
How much should I spend on advertising?
The amount you should spend on advertising will depend on the industry and your type of business. A general rule of thumb is that small business owners should allocate from two to five percent of gross sales but as much as 10 to 15 percent of expected gross sales when launching a new product or service or when competing in the mass market. SBDC consultants are available to help you with industry information, delivery vehicles and planning your advertising budget.
What is the best form of advertising for my business?
Every business has a "best" method of advertising. Experience is a good teacher, so compare the methods used by your successful competitors with what you plan to do. SBDC consultants can help you evaluate advertising alternatives.
Should I advertise in the yellow pages?
For some retailers and service providers advertising in the yellow pages is practically a necessity (e.g. plumbers or tire dealers. ˜Yellow pages advertising can be expensive depending on your listing or ad size and cannot be changed for a year. To find out more about this form of advertising, you may want to contact the Yellow Pages Association.
How do I find new customers?
The first step in finding new customers is to specifically determine your target market. It may be broken down by age, gender, socioeconomic status, geographic region or any number of behaviors or lifestyles. Once a target market is identified, you can determine the best strategy for reaching it. SBDC consultants have access to demographic data, as well as expertise in designing effective marketing campaigns to target new customers.
How do I keep my existing customers?
The best way to keep customers is to give them quality service at competitive prices. A rule of thumb to keep in mind is the 80/20 rule--80 percent of your business comes from 20 percent of your customers. It is important to focus marketing efforts on those valuable 20 percent. Business owners must have a customer service plan in place and train all employees to maintain an excellent standard of service and strive to always meet customer expectations. The product or service should be the same every time. It is important to remember that doing business with your company should be pleasurable and memorable for the customer. Problems should be taken care of quickly and completely.
Do I need a website?
A website can be an effective marketing tool for some businesses. Before spending money on development and design, investigate whether or not your industry is dependent on this type of marketing. In addition, there will be costs associated with maintenance and hosting services. For more information on whether developing a website is something you should do, talk with your SBDC consultant.
Does the SBDC offer classes in marketing?
Yes. These classes provide useful information on how to market your business using effective and unique strategies designed specifically for small businesses. Learn how to maximize your marketing dollars and enhance your profitability. To find a class in your area or to register for an online class, click here.
Does the SBDC conduct market research?
Yes. The SBDC’s Applied Research Division is available to provide in-depth customized market research for clients on a fee basis. Additionally, the SBDC International Trade Center conducts global business research. Local SBDC consultants regularly assist clients with identifying key information for inclusion in business or marketing plans or for compiling loan documentation.
I'm already in business. Do I need a business plan?
A business plan provides a reference for determining the degree of success of your business efforts. It should be periodically updated to reflect your current situation. It can be a helpful tool for developing a marketing plan, expanding your current business or obtaining capital for the future. You may want to purchase the book, "Mastering Loan Proposals." Additionally, the SBDC offers consulting services and business plan classes both locally or online.
Who should write my business plan?
You should. Writing your own business plan will force you to think through important issues that you may not otherwise consider. Contact your local SBDC for assistance in developing your business plan.
Do you recommend business plan software?
The advantage of off-the-shelf business planning software is that it helps you organize your business plan and gives you good examples to help you craft your own document. Most software packages generate charts and graphs from the financial spreadsheets incorporated into the plan. The disadvantage is that these plans often look ?canned.? Loan officers receive hundreds of these plans and can instantly recognize them. If you copy the examples from the business plan software into your plan, loan officers will recognize that it is not your work and will probably discount its credibility. All you need to create your own business plan is a word processing program and a spreadsheet program. Your local SBDC office can provide you with guidelines, examples, individual counseling as well as classes to help you write an effective business plan.
How long will it take to write my business plan?
Writing a business plan is a difficult and arduous task and can take anywhere from 20 hours to several months. It depends on the complexity of the business venture or project that you are planning and how much information is needed to thoroughly complete it.
What legal entity should my business be?
There are a multitude of choices for your business entity but the most common are: sole proprietorship, partnership, C Corporation, S Corporation or Limited Liability Company(LLC). Choosing the legal structure for your business usually is a function of liability and tax considerations. Also, as businesses mature, their legal structure may change to accommodate growing complexities. Look at the principles and/or investors for considerations of liability, residency or tax consequences that can influence the choice. Secondly, examine the nature of the business to gauge risks inherit in its operations. Finally, consult with your accountant and legal advisor for input on legal entity choice.
Do I need a lawyer to start a business?
Even though an attorney is not required, we recommend you consult an attorney, especially if the company you seek to form has more than one owner. Forms and instructions for each type of business entity are available at the Georgia Secretary of State's office.
Where do I obtain a business license?
Business licenses are issued by the municipality or county in which your business is located and fees may vary by location and type of business. For more information, call your local city or county business license office.
Do I need a special license for my business?
Certain businesses are subject to special permits, licenses and inspections. These include schools, employment agencies, child care centers, securities dealers, motor transport, financial institutions, public entertainment, detective agencies, cosmetologists, heating and air, refrigeration, plumbers and electricians. Information about licensing, permits and inspections can be found through your local licensing or inspection office or through the Secretary of State.
What is the difference between an employee and an independent contractor?
If you have care, custody and control over how your "worker" does the job, classify them as an employee. Generally the definition of employee is an individual uses your tools, comes to work on your schedule, and you supervise their efforts. An independent contractor owns his/her own company and offers their services or products to several clients. Fo instance, a freelance floral designer who works overflow for several florists during the year is an independent contractor; the floral designer who only works for you part time is an employee.
Do I need Workers Compensation Insurance and how do I obtain it?
Georgia employers with three or more employees are required by law to carry Workers Compensation Insurance. This insurance is regulated by the State but sold by local community insurance agents. A minimum of three quotes is recommended. Owners that work in the business are considered employees but can exempt themselves from workers compensation insurance coverage. For more information, visit the State of Georgia State Board of Workers Compensation website.
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