5 Reasons Why Businesses Should Know the Importance of Big Data

The ones who are in business or planning to be in the same, must be thinking what will be the relevance of Big Data to business and how can it help in an effective running of businesses. Well, innumerable people believe that Big Data is needed in a few particular fields. However, that’s only a myth; instead, it is free from any boundaries and can aid in every Business’ inside-out operation.

Reasons that Validate the Importance of Big Data

Big Data operates irrespective of any field or size of the business, as management and collection are done in every field; thus, making it more accessible. Let’s get an insight at the reasons that validate the importance of Big Data into businesses:

  1. Data is an asset to the business: Every business generates the data, be it small or large. All the activities generate data and a proper strategy is needed to store this data. The amount of data can be huge or less, but a proper strategy can help the business to manage it the right way by collecting, using, and protecting it. This indicates that the companies that believed Big Data is not meant for them will now be able to use it and understand its importance.

  1. Collecting better market and customer data: Customer and market trends are the few important factors for the business to be kept in mind in order to gain success. Every company manages data to understand the moods of their customer that tend to change with time. Hence, Big Data analytics can be useful in getting a better understanding about the needs of customers, their usage demands, and what would they be buying future.

  1. Improvement of internal operation and efficiency: Businesses also have to focus on the data of their employees that includes, optimization of services of delivered, tracking the performance, and even the recruitment of suitable candidates; all can be done with the help of Big Data. This can help the businesses to let them improve the internal efficiency in varied departments.

  1. Effective financial trading: Financial Transactions are also an important factor for the companies, as it leads to economic growth of the organization. Financial trading between the companies and clients can be handled well with the help of Big Data analytics, as it handles the algorithms required for the account related purposes.

  1. Understanding business processes: The optimization of business processes can now be done more easily. Retailers can maximize their stock based on the data predictions given by social media. Supply chain and delivery route can now be optimized with the help of this technique. The HR department of the organizations is also getting benefited like while hiring the right talent. It also measures the amount of employee engagement with its tools.

Hence, Big Data Analysis is not confined to certain counted fields, but enlarging its horizon of services and quantifying itself to a larger scale. If used properly, it can affect the businesses to an unexpected extent and giving more and more growth opportunities.

The candidates who have a great knowledge of the tools used in Big Data Analysis are in great demand. But, for this they need to have the knowledge of the software that can help in this task. One of the best software that suits their requirement is Hadoop and a formal training of the same can turn extremely fruitful.

Should I Establish An S-Corporation For My Business?

The sub-chapter S corporation was originally created in 1958 to provide the benefits of operating a business inside a corporation, with the liability protection of a corporation but it has many similarities to a partnership.

If a business is incorporated, the corporation will pay the taxes as a C corporation unless you elect to be taxed as an S corporation. The owners of the corporation must file an S corporation election on form 2553. It may be filed anytime during the year prior to election as an S corporation or up to the 15th day of the third month after the beginning of the year. In community property states the spouse of the shareholder must also sign. Basically, this is consent by the owners to have the profits flow through to them as individuals and not be taxed at the corporate level.

Normally S-Corporations must operate on a calendar year.

There are some limitations on who can be an owner of an S-corporation. A C corporation cannot be a shareholder, nor can a nonresident alien. The S-corporation must have 100 or fewer shareholders. There can be only one class of stock. Shareholder debt convertible into stock can be a trap and invalidate the S-election. If one shareholder sells so much as one share of stock to an ineligible shareholder it will terminate the election and the S-Corporation is not allowed to reelect for five years.

The income or losses, of the corporation are taxed to the owners, in the same percentage as they own stock in the corporation. If they own 20% of the business they are taxed on 20% of the profits, 100% ownership taxes 100% of the profits. This is reported on schedule E of their personal income tax return, form 1040.

It should be noted that an owner is not allowed to take a loss from a corporation if that loss exceeds his basis in the S-corporation. Basis is the amount the shareholder has invested in the company, including both stock and loans. It is a very important point to remember that a bank loan to an S corporation even though guaranteed by the owner does not create basis. Should the S corporation have a loss exceeding the investment by the owner, it would not be deductible by the shareholder even if covered by the bank loan the shareholder has guaranteed.

The corporation is required to pay out reasonable salaries. Much litigation has taken place on what is a reasonable salary. Wages and salaries of owners are subject to payroll taxes. Profits beyond salary can be paid out as dividends. There is a tax advantage to this. Dividends are not subject to self-employment tax. This can be a huge savings over a sole proprietor.

The IRS position on dividends seems to hold that profit in an S-Corporation needs to be generated by something other than the efforts of the owner in order for dividends to be paid and not be subject to employment tax. Realtors are a case in point. If all their income is generated by their own efforts, there is little rationale, according to the IRS, for paying out profits as dividends.

There is a fringe benefit problem with an S-Corporation. If getting health insurance and certain other fringe benefits are an issue to the owners, they should be wary of an S-corporation. Health benefits are passed through to an owner as though he received the income and paid for them himself. He is allowed to deduct them on schedule A of his personal return, but oftentimes with income limitations on personal medical deductions that does him little good.

S-elections of existing C Corporation can have tricky tax consequences. That is beyond the scope of this article. Look carefully before you leap.

Liquidation of an S-corporation is less difficult than a C corporation. The basis of the stock is usually roughly equal to the basis inside the corporation, so there is usually no gain on liquidation.

As with all corporations it is wise upon forming a corporation to file articles of incorporation and create bylaws with corporate minutes. Jump through all the legal hoops. A federal corporate identification number is required for payroll, depending on the state, a state number for payroll and corporation tax or sales tax will normally be necessary. Attorneys currently often favor forming an LLC and then filing an S-election. This will work. Some attorneys feel there is a slight advantage in doing so.

There is no magic, if you incorporate your business. Generally with very few exceptions, you are not able to deduct any expenses, which you could not deduct as a sole proprietor, partnership or other form of business organization. The standard for allowing a deduction is that it must be an ordinary and necessary business expense.

One final piece of business advice. The lawyers are quick to make the argument for incorporation as a protection of personal assets from business liability. Each case must be examined separately, because circumstances vary. However more than 30 years of business experience have convinced me the best protection is to carry adequate insurance coverage.

S-Corporations are complicated. The above gives the general rules, but the tax law, and life are riddled with exceptions. Setting up an S-Corporation is not a do it yourself project.

Be Prepared – Ensure Your Business is in a Ready State to Advertise For Sale

If you have taken the decision to sell your business, you will no doubt have researched the internet for options on how to advertise your business. There are a large number of paid and free “businesses for sale” portals out there.

However, before you make that ultimate decision to advertise your business for sale, take a moment and ask yourself, is my business really in a ready state to advertise? Is it attractive to a potential buyer? Are my accounts in order? Would I invest in this business? If you have any doubts, no matter how small then take a few moments to consider the following points. They may save you months of heartache, disappointment and money:

1) Talk to the right people – firstly it is good idea to discuss your intentions with your accountant. Not only will this prepare them for any future discussions with potential buyers, they can also help advise on the best way to sell your business. Accountants are in the main very knowledgeable people who have numerous clients from all walks of life – they’ll know the true value of your business and it’s financial strengths and weaknesses. If you do not have an accountant then do yourself a favour – get one! I’ve lost count the number of times I’ve heard the expression “I can’t afford an accountant”. Absolute non-sense – my answer is “you can’t afford not to have one!”

Sadly many small business owners have the distorted impression that accountants cost a lot of money. A good, reputable accountant has one sole aim in mind – to save your business money and ensure you only pay what you have to. If they didn’t, they wouldn’t be in business very long. So many business owners try to take shortcuts by declaring and calculating their own accounts. Invariably, they end up paying far more than necessary. If you are selling a business, you need to ensure you get good financial advice to avoid paying over the odds when it comes to tax, capital gains and the valuation your business and its assets.

So get on the phone and call your accountant and get on the internet and find a good local professional. Most towns and cities have numerous accountants who charge very good rates.

2) Clean your act up – have you kept your business accounting books and tax records in order? If not, why not? A potential buyer wants to buy a business that has been well maintained. How does it look to a buyer if you haven’t looked after the most basic of necessities? It reflects badly on you and it will make any potential buyer nervous and skeptical. So before you even attempt to advertise your business, ensure all of your records are up-to-date, clear and transparent. Even better is to prepare summary figures to show profits and losses for at least three years and show sales patterns. In short, show that you know your business inside and out – it will illustrate a huge level of confidence that you have a complete understanding of your businesses operations, value and profitability.

3) Talk to an agent – by meeting with one or two agents, you get free impartial advice. Whether you decide to use an agent to sell your business is entirely your decision however, by talking to them for an initial consultation, you can get a greater understanding of how a buyer may see your business and it won’t cost you a thing. Agents are very knowledgeable people and have dealt with all kinds of businesses and all sizes of businesses. They will ask the questions that buyers will no doubt ask – if you trip up here, at least you have a second chance to get it right before you lose a potential buyer!

So get on the phone and talk to an agent. Ask them to visit your premises so that they can fully understand your business, what your operation does and why you want to sell. In most cases they will not charge you for an initial meeting and in many cases, will offer an initial valuation and feedback on whether they feel they can sell your business for you. Free advice is good advice so take it if you can.

4) Get the facts together – you’ll be amazed at just how many sellers are ill-prepared to sell their businesses and what little information they have ready for potential buyers. If you have access to a computer with word processing software, you can do yourself no harm by spending a few hours in putting together a business information pack. Inside this document you should include items such as a synopsis of the business, its history and its operations. Also include items such as the reasons for your sale, even if it is a little edited if you do not want to declare the full story. More importantly, you should list the details of the sale and what is included such as the assets, liabilities, property, goodwill and basic customer info (although do not include detailed names or companies).

Also take photographs and include these if they will help illustrate your products or services. Give as much information as you can within reason. Naturally, you need to be diligent and careful in what information you disclose to potential buyers as you do not want to jeopardize the value of your business as it presently stands but by going the extra mile and by preparing this document, you do yourself many favours. For example:

a) you show to any potential buyer that you have done your homework and run your business with efficiency and dedication
b) you’ll weed out the time wasters and prevent meetings or discussions with buyers who are simply window shopping
c) you’ll save yourself hours of discussions covering the same questions and answers, over and over again
d) the document can be used as a download on business for sale websites
e) the document can be used as a handout for meetings and is a great way to break the ice!

This little bit of preparation can go a long way. A few hours of your time could save months of waiting for a buyer.

5) Get a confidentiality agreement prepared – before you meet with anyone, get a non-disclosure agreement (also known as a confidentiality agreement) ready. They can be bought quite cheaply from bookstores in standard legal document packs or online for a few pennies. Potential buyers will ask all kinds of insightful questions regarding sales figure, profits, losses, suppliers and your customer base. Think first about protecting your operation – get a document ready and do not disclose anything to anyone until they sign and complete one.

6) Get a lawyer – just like an accountant, start speaking to lawyers and let them know of your intentions. Selling a business isn’t cheap and lawyers don’t come cheap either! Rates can vary greatly dependent on their level of experience, size of company and location. If you can agree to a fixed or capped fee then you could be onto a good thing. In the legal arena time really does mean money so ensure that you know what you will be expected to pay when you use their services. Very rarely does a business get sold without the use of lawyers or solicitors so if you can strike up a good relationship with one beforehand, it will help you a great deal. Legal costs can be very high so make sure you are prepared for the expense when you calculate the value and price at which you want to advertise your business at.

7) Look Smart – whether you own a shop or store, manufacturing business, a service agency or anything for that matter, make sure you keep your image clean and tidy. When your business goes on the market, you will start to get enquiries. It’s not uncommon for prospective buyers to pay an unscheduled sneaky look at the business so clean the place up and make it look pristine as you never know who may walk through the doors next. A clean business is an attractive business.

If you have now ticked all of the boxes above then great, you’re most likely ready to get advertising your business for sale. Good luck and don’t forget to read my other blogs on ways to buy and sell businesses successfully!

The Benefit Of A Good Business Education

Find out how a good education can help you succeed much faster.

Your business needs help to grow. All businesses need help to grow. This can be in the form of business advice, technical advice or financial advice. There are many organisations that advertise their experience in such matters and invite you to approach them. Each will have their specialist knowledge and they will all claim to want to know about your business. But how many have you approached that really just want to sell you their business? They give you generic advice rather than specifics and they try to make your business model fit around their advice or expertise rather than the other way around. There is something different out there though. Let me explain…

It’s all about you!

Imagine working with a company that knows your business inside out because they helped you to set it up, market it and grow it. Imagine being able to get specific information about how to finance it, where to market it and who to. Imagine having a mentor that was available to you to show you how to avoid the pitfalls and mistakes that you would have invariably made if you had tried it on your own. Imagine working with a company that offered you all the above plus an amazing education package into the bargain. Sound good? Well these are just some of the benefits of belonging to a group or organisation, and getting educated by people who have already done what you are trying to do.

Getting the right information about something is always useful and business is no different. If you pay someone to show you how to do your accounts then you are not having to outlay the cost of a wage for someone else to do it for you each month when all it needs to take is an hour or so. If you want to know the best place to advertise and how to do this then you can spend lots of money trying to figure this out yourself, or you can spend less on getting someone to show you and thus saving the money on costly mistakes or ineffective sales copy.

Being taught what not to do is invaluable. Why go out and repeat someone else’s mistakes when you don’t have to? Why waste money on things that don’t work when you don’t need to? If you had decided to become a Doctor you wouldn’t have just figured things out yourself by trial and error would you? You would have spent a lot of money and time getting yourself educated properly to expedite the process and so that when you eventually became a Doctor you would be proficient and professional. Why then would you not do the same for your own business?

It doesn’t have to delay your start date

Yet another benefit of education is that you can earn while you learn. People don’t want to have to wait months going through training courses and attending seminars before they can get their business up and running. It is understandable that people just want to get on with the task of making money to pay back their investment. With the right guidance and support though, you can try things out with much more confidence and much less risk. You can ask for advice as you go along or get someone to have a look at what you are currently doing and get their feedback. This means you can start your business right away, but are not going to fall into the traps that many other new business owners find themselves in.

Most very successful people today have coaches or mentors. They rely on someone to help them to become the best they can, and they want them to be able to do this quickly. Sports people need to be at the top of their game this season not next. Politicians need to be able to get peoples votes for this election not the next and businessmen want to be able to stay ahead of the competition right now. Your business deserves no less. A mentor or coach would be a great investment and a good one will make their fees back many times over.

Tool up!

Education then, in my estimation, is most definitely the key to success no matter what it is that you are doing in life and should never be overlooked or undervalued. Get all the help you can with the latest techniques, strategies and methods and learn what not to do that will waste your money. Learn as many of the tools of the trade as you can from wherever you can and use them. If you do this then you will spend less, be more successful much quicker and have a lot less stress in your life.