Legal Business Entities

Are you putting together a new concessions business? If so, have you chosen the best legal structure for your new company? Have you gotten that far yet? If not, here is a great breakdown of the legal business entities available in the US today. This list has been compiled by SCORE.

We hope that you will find the descriptions of these business entities helpful as you move forward in forming your new business.

Types of Legal Entities

Choosing the legal structure of your business is an important first step to beginning operations. Different business entities offer different levels of protection, control and potential tax savings. Here are some of the most common types of business organizations:

Sole Proprietorships
A sole proprietorship is created by default–if you begin business operations solo, without forming a specific organization, you’re a sole proprietor. Sole proprietorships have the least amount of liability protection for the business owner. If your company is sued or pursued for unpaid debt, creditors can seize your personal assets as repayment. Sole proprietors pay tax on business income on their personal income tax returns–the business does not pay its own taxes.

Partnerships
Partnerships are similar to Sole Proprietorships in that income “passes through” the business to be taxed at a personal level. Partnerships can offer some liability protection if they are structured as limited liability partnerships. A partnership can allocate profits and losses among the partners as it sees fit–usually specified in the partnership agreement. Partnerships can also be “formed” very informally in some cases, without filing any legal documents.

C-Corporation
Most for-profit companies operate as C-Corporations. The owners of a C-Corporation, called shareholders, are taxed twice–once at the corporate level (the corporation files its own tax return) and once at the personal level on income received from the company. C-Corporations offer heightened protection for owners and allow a more formal, defined structure for business owners–you’re required to file articles of incorporation, hold annual meetings and meet other requirements, depending on which state you choose to incorporate in.

S-Corporation
S-Corporations also provide personal liability protection against business debts. S-Corporations are similar to C-Corporations in many respects–there are certain requirements for formation and operation and the corporation is its own legal entity–but income “passes through” the corporation to shareholders, similar to taxation at the Partnership or Sole Proprietorship level. An S-Corporation offers many of the benefits of incorporation without exposing the shareholders to the double taxation a C-Corporation requires.

LLC
A Limited Liability Company (LLC) is a hybrid entity that has some characteristics of a corporation. Rules for LLCs are usually determined at the state level and can vary depending on which state you form your business in. LLCs have fewer ownership restrictions than corporations and more flexible management structures, but allow owners fewer options when it comes to raising capital for business operations or finding investors.

No matter which type of business organization you choose to form, make sure you consider all of your options before making a decision. It’s a good idea to consult with an attorney, so you can fully understand the benefits and drawbacks to each type of entity.

SCORE, the “Counselors of America’s Small Business Owners” is a national association dedicated to helping small business owners form and grow their businesses. Headquartered in Herndon, Virginia and Washington D.C., SCORE has 364 chapters in the United States as well as in U.S territories. SCORE is a partner of the U.S. Small Business Administration (SBA).

5 Tips for Small Business Owners in 2010

Since we are all considered small business owners, I thought it might be a good idea to grab a few good tips from the many articles that are out there on the web and put them here in ConcessionCentral (with proper citation and links of course). As I'm sure you're fully aware, there is a ton of information on the Internet on just about every subject possible. For many of us, it can be a daunting task to wade through it all to find a few good nuggets of helpful information.

With the year just getting underway, this seems to be a good time to review and refine some business practices for most of us. If your business is seasonal, this is a great time because it's cold out there and most seasonal business are closed.

So, from one small business owner to another, here's what I have found so far that I felt like passing on to you:

1. Offer Good Quality at a Fair Price
The second principle for business success with any product or service is that it must be of good quality at a fair price. If it's in competition with other similar products or services, it must have what's called a Unique Selling Proposition—one or more features or benefits that make it unique, different and superior to any competitive product or service.

This area of uniqueness is central to success in business. No product or service can succeed unless it's somehow unique and superior to any other product or service that competes with it. There's seldom any opportunity to build a business around a "me too" product—a product or service that's just the same as all the others, where the only difference is that it's you who happens to be selling it.

The safest business strategy is to start off with an accepted product that already has a widespread market and then find a way to improve upon it in some way. Deliver it faster, make it better or of higher quality, or lower the price of the product or service in some way. Instead of trying to invent a new business or industry, start off with a product or service that people are already using and find some way to make it more desirable. Courtesy of Score.org

2. Cut Personal Expenses: Find ways to cut costs outside of the business, because you’ll likely have to take home less pay and even go into your savings: 69 percent of small business owners say that current economic conditions are forcing them to reduce the amount of money they take home from their businesses, and 61 percent think they are very or somewhat likely to use their personal assets in the next year to keep their businesses afloat. Courtesy of Yahoo! Finance.

3. Create a social media policy: Social media is not a fad any more. It’s time to stop experimenting and start managing your social media strategy. Create a policy around social media, even if you’re only a one-person operation. Your social media policy should include your objectives for each site and any rules you have around posts, articles, pictures, etc. Creating this policy will eliminate employee confusion, problems and PR and potential digital reputation management nightmares. Courtesy of American Express Small Business Open Forum

4. Keep all documents.
When it comes to your taxes, it’s a good idea to be a pack rat. You’ll have peace of mind knowing you can produce any document at anytime, no matter what questions may come up. Always organize and carefully file away:

Credit card bills and receipts
Old checkbooks
Bills and invoices
Mileage logs and documentations
Canceled checks or proofs of payment (VERY important)
Any evidence that supports deductions and credit claims on your tax returns
Courtesy of ESB Journal

5. Put all agreements in writing.

The laws of your state require you to put some contracts and agreements in writing:
Contracts that will last longer than a year.
Contracts that involve the sale of goods worth $500 or more.
Contracts that transfer the ownership of copyrights or real estate.
Even if not legally required, it's wise to put almost everything in writing, because oral agreements can be difficult or impossible to prove. This includes leases or rental agreements, storage agreements, contracts for services (such as consulting or electrical work), purchase orders or contracts for goods worth more than a couple hundred dollars, offer letters of employment, and employment policies. Get in the habit of getting and giving receipts for all goods, services, and deposits, regardless of how much. Courtesy of Yahoo! Small Business

As you can see, I have pulled one tip from each of these sites. I would encourage you to go back and read each of these articles. They contain a lot of great information for business owners. Whether you're just starting out or you're a seasoned business owner, there are some great tips in these articles that will help you make your business more successful and profitable.

How to Successfully Market Your Concessions Business, Part 1

We have talked about marketing many different times over the past couple of years. It's topic that will always be on the forefront of any conversation about business until the end of time. Marketing and business are really inseparable.

Over the course of previous posts, we have also recommended various methods and resources to aid you in marketing your business too. The Small Business Administration's website has been mentioned more than once...and it's going to be recommended again now.

The SBA website (www.SBA.gov) is full of great, free resources to business owners and people who are considering going into business for themselves. I would urge you to spend some time digging through their website and see for yourself just how much valuable information is there.

Right now, my recommendation would be for you to take a look at the many different articles available there that are directly aimed at giving you (a business owner) tips and ideas on how to effectively market and advertise your business. This list of articles can be found by clicking here. One of the articles that I found most interesting so far is entitled, "15 Foolproof Ideas for Promoting Your Company". While every one of these points is not applicable to someone who owns a shaved ice or snow cone business, many of the points are very relevant and contain good suggestions.

So, during the offseason (for those of you who own seasonal shaved ice and snow cone stands), I would encourage you to take some time to read these articles. Print them out and read them when you're offline.

There are some "good tools" on the SBA website for your business operation "toolbox" that will help you operate your business more successfully.

Look for Part 2 in How to Successfully Market Your Business in the coming days!

Take care!

Water Quality – Suggestions and Solutions for Poor Quality Water

Water quality varies greatly throughout the entire United States. The vast majority of our customers who operate their own shaved ice or snow cone businesses are able to use their water straight from the tap when making their shaved ice syrups and block or cube ice. However, if the water quality and the taste of the water in your area of the country is not the best, you may need to have the water filtered or buy bottled water for your syrups and ice making.

If the water in your area has an unsuitable taste, we suggest making a small batch of shaved ice or snow cone syrup with your current water supply to see if the large amount of sweetness from the sugar in the syrup overpowers and masks any bad taste originating from your water. If your syrup still has a “funky” taste, try using an over the counter water filtration system. However, if your water is really bad, then we strong advise you to contact a water quality specialist in your area to find out how you can get the best quality water at a reasonable price. Yes, it’s an added expense for your business. But, in the long run customers will appreciate your dedication to serving them a high quality, great tasting product.

Good Resource: 10 Tips for the First-Time Business Owner

While reading through some other business related posts this weekend, I came across a good resource for people who are thinking of starting their own business. The article was written for Entrepreneur magazine and is entitled "10 Tips for the First-Time Business Owner."

There are some very good points made throughout the entire article and it's definitely worth reading and considering the information given in it.

My particular favorites are points #1 and #2. In point number one the author makes the following statement, which I really appreciate: "Do one thing perfectly, not 10 things poorly." Focus on what you do really well and use it to your advantage!

In point number two, I appreciate the author's frankness about the impetus behind starting a small business: "Do what you love. Businesses built around your strengths and talents will have a greater chance of success." I think there is a ton of truth behind that mindset. If you're passionate about your business (whether it selling snow cones or building high-tech complex machinery), you stand a much greater chance of success if your heart is in it.

So, if you're passionate about snow cones or shaved ice...then be dedicated to your business and refine your processes and business plan constantly in order to give your customers the best product possible. In doing this, you will ultimately succeed!

Young Entrepreneur in Las Vegas Chooses Shaved Ice Business

I came across this article today about a young man and his shaved ice business in Las Vegas, NV. I thought it was definitely worth sharing with our readers. It's always encouraging to read about young people who have solid goals in place and a strong work ethic to help them attain those goals! It looks like Jeff Brunner is hard at work to achieve his long term goals. I hope you don't quit pursuing your goal Jeff (I'm a pilot and flying airplanes is such a blast!).

As I've mentioned in the past, it's always good to read about other people's experiences in our industry. I think there are several good, key points to remember from this article. One major thing to take away from this article is that it is incredibly important to find out what laws and regulations are in place that will affect your business and your potential location. Do your homework!

I hope you enjoy the article!

Giving Back

It's always nice to find ways to give back to your community through your business. One of the ways that 1-800-Shaved-Ice.com, HawaiianShavedIce.com, and CottonCandyExpress.com gives back to our local community is through a summer program called Newton Grove Movie Nights (www.NGMovieNight.com). The movie nights are held in a local park where we bring in a large, inflatable projection screen and show a movie for free. Concessions (popcorn, snow cones, and drinks) are free to children under 18 and adults must pay for their snacks and drinks.

The first movie night occurred just about two weeks ago. We had over 400 people come out and enjoy Adam Sandler's movie "Bedtime Stories". We also made a ton of snow cones and gave out hundreds of bags of popcorn.



We look forward to the next movie night. We enjoy being able to give back in a this way to the community and people who have purchased our products over the years.

We encourage you to find some creative way to use your business to be able to give back in some capacity to your community. There are many different opportunities to get involved in fundraising for local sports teams, or other good organizations such as Boys and Girls Club, Girl Scouts, Boy Scouts...the list goes on. If you are already involved in giving back to your community, please let us know about it. We would enjoy knowing how other businesses engage in giving back.

Thanks!

Excellent Resources for Concessionaires

I've discussed the Small Business Administration in previous articles, however I wanted to mention them again. There are some excellent resources available at the SBA Website.

I would encourage you to go to the site and review some of the great tools and information that is available to you. Remember...it's a FREE resource for you. Well, not completely free since you are a taxpayer. So, with that said though, take advantage of your tax dollars!

Not interested in reading through articles? Try out some of their podcasts. Download them and listen to them while you're driving to your stand or during a slow period. Some podcasts that stand out to me are:

Check List for Starting a Business

Featuring Wendy Baumann, President
Wisconsin Women’s Business Initiative Corp.
Milwaukee, Wisconsin

How can a prospective entrepreneur know if he or she is ready to start a business? This checklist helps you identify what you need to know and what you need to do to start a small business.

Is Entrepreneurship for You?

Featuring Cheryl Mills, Associate Deputy Administrator
Office of Entrepreneurial Development
U.S. Small Business Administration

Each year more than 600,000 new businesses are started in the United States. Many will succeed while others fail. Find out if you have what it takes to be an entrepreneur and how training maybe be the key to success.


The SBA Small Business Training Network—Log On!
Featuring Jim O’Connor, Director
Small Business Training Network
U.S. Small Business Administration

To succeed in business entrepreneurs must stay competitive. An essential ingredient to being competitive is training. Learn how SBA’s online Small Business Training Network—a virtual campus—can help potential and current small business owners start, grow and succeed.

This is only a sampling of the many podcasts that are available for free download. While these podcasts will not directly discuss concessions businesses, they are certainly full of tips for any small business and helpful.

If you get a chance to listen to one of their podcasts and find the information in it helpful, I would encourage you to leave a comment here so that other 1-800-Shaved-Ice.com customers can benefit from it too. Thanks!

Looking to Start Your Own Shaved Ice or Snow Cone Business?

With tough economic times upon us, many people are looking at alternative ways to generate additional income. Shaved Ice and Snow Cone Businesses are profitable and viable options that generally don't involve a tremendous amount of money to get started.

If you are thinking of starting the exciting journey of owning your own shaved ice or snow cone business, we strongly suggest that you read our FREE business manual: COLD CASH, An Insider's Guide on How to Make Money in the Shaved Ice, Snow Ball, and Snow Cone Industry. This 106 page guide covers many aspects of starting, maintaining, and owning your own concessions business. Please feel free to visit our website and request a FREE copy of this helpful guide.

We wish you the best in your journey towards starting and owning your own concessions business. Please feel free to ask questions of us here in the blog, call us at 1-800-Shaved-Ice.com, or email us.

Basic Business Principles

I came across this slideshow recently and thought it was worth sharing with you.

As business owners (or potential business owners), it's important to establish these principles from the very beginning. However, if you haven't established some basic operating principles for your company...it's not too late! In light of today's fragile economy I would encourage you to seriously take the time to analyze your business, streamline your operations, and stay on top of everything.

Top10 Basic Business Principles

View more presentations or upload your own. (tags: business principles)

In future posts, I hope to delve into some of these points a little more in-depth. Greg Fisher (creator of this presentation) is a fan of Guy Kawasaki, as I am too. I think Guy has a lot of great wisdom and experience on business operations and how to maximize the impact of your company. So, I plan on looking to him for well qualified information along with personal experiences in my business dealings over the past 20 years.

So...there's more coming. But, for now I encourage you to view the slideshow and also visit Greg Fisher's site too - he has quite a bit of good, helpful information on his site.

Thanks!