Business Club

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[al-of-gold]

Thanks Steve!!!!!!!!!!!!

Al

[Falcondfw69]

I would like to be a member.

[Vanilla Ice]

Me Too as I own my own coffee shop!

Ross

[al-of-gold]

OK guys, any suggestions on what to post and talk about is most welcome!

In the meantime...is there any question of any kind in a business nature or of economics in general please feel free to ask as I will do my best to answer.  Time to put my MBA to work

I will answer any questions such as mortgages, real estate in general, interest rates, how to run or purchase a business, how to predict a recession etc.  I will do my best in trying to answer any questions.

I may even consider a newsletter in the future....like I said....any suggestion is most welcome!

Al

[Falcondfw69]

Al,
    Why not start with the basics of starting and running a business? I know there are at least two of us that are in the process of getting fledgling businesses going.

Falcon

[al-of-gold]

Falcon, thats a loaded question....are you talking of aquiring a business or starting one from scratch?

Also I need to know what kind of business you are talking about, in your case I would assume a restaurant am I correct?

You have to put together a business plan in order to present to the bank assuming you are going to borrow any money for the start up costs such as the purchasing of chattels, and day to day working capital, the general rule is to have at least one months cashflow on hand in the bank as a working captital. This is to fund day to day operations as there will  be many unforseen expenses in the first few months such as training of employees and maybee purchasing of inventory and many more too numerous to name here.

Another very very important one is the lease......you must be sure you can manage the lease amount as it is usually the killer in most business mortallities.  It is usually calculated in terms of an amount per square foot of leased space. The general rule is to have at least a 5 year lease with a 5 year option so as to insulate yourself from future price spikes.

Another important thing is to incorporate your company to prevent any liability so if it fails, the creditors don't come after your personal belongings. These are usually called numbered companies!

Falcon, I need to no more of a particular situation or my info is too broad to be of any use!

Al

[Falcondfw69]

    Actually, I was talking about starting a business from scratch. I am currently in the process of getting my web design/custom programming/training/business technology consulting business going. I have a few clients, but I am having to go back to work for someone else, because my business is not enough to earn a living on yet.
    On a secondary note, I assume, other than the industry specific aspects, starting a business would be the same whether it is technology or a restraunt.

Falcon

[al-of-gold]

Falcon.....yes and no as in your case as a consulting business, if you are going to work from home then the part of the lease will not apply to you, but then I will be as general as I can be then!

First you have to calculate how much sales per month is your target!       Lets say $10,000 per month
Next is to calculate your cost of sales, being rent,labour,inventory,utilities,and miscellanious  Lets say $6,000 per month
THis gives you $4,000 per month of cashflow, from this you have to calculate any bank loans payments per month if any!
This shall give you your net income before taxes.

It is highly advisable also to get liability insurance just in case you become liable for something and they take you to court, like I mentioned earlier, to incorporate comes in handy here also.

In your case you also need to calculate the start up cost of your equipment such as computers, routers, internet costs and the like.

One rule of thunb as to know if your business is viable is to calculate the total amount of your start up cost. Then you calculate your total income per year minus all your expenses including your salary since you are running it and the general rule is that you should be generating a 10% return on your invested capital.

If you require more info...please feel free to post!

Actually....this is fun

Al

[al-of-gold]

something I forgot to mention earlier is that its a good idea to calculate your break even point on a per day and even a per hour basis.
the way you do this is to calculate your monthly expenses.....lets say $6,000 divided by the number of hours of operation in a month.
So lets say 40 hours per week times four weeks is 160 hours, so your hourly cost is 6,000 divided by 160 which is approximately 38 dollars per hour, I don't have my calculator on me but that sounds about right.

So this is your break even point, any hour you make less than this you are losing money.  This is also a good way of monitoring what hours you are  most profitable so as to figure out what your schedule should be.

Al

[Athena]

something I forgot to mention earlier is that its a good idea to calculate your break even point on a per day and even a per hour basis.
the way you do this is to calculate your monthly expenses.....lets say $6,000 divided by the number of hours of operation in a month.
So lets say 40 hours per week times four weeks is 160 hours, so your hourly cost is 6,000 divided by 160 which is approximately 38 dollars per hour, I don't have my calculator on me but that sounds about right.

So this is your break even point, any hour you make less than this you are losing money.  This is also a good way of monitoring what hours you are  most profitable so as to figure out what your schedule should be.

Al

Can I join in?  This is a revolutionary financial Planning!--- A KEY TO FINANCIAL FREEDOM   And this will help a lot of our friends here to maximize earnings and be productive too...so it would be a lot of fun to be part of this

[Athena]

something I forgot to mention earlier is that its a good idea to calculate your break even point on a per day and even a per hour basis.
the way you do this is to calculate your monthly expenses.....lets say $6,000 divided by the number of hours of operation in a month.
So lets say 40 hours per week times four weeks is 160 hours, so your hourly cost is 6,000 divided by 160 which is approximately 38 dollars per hour, I don't have my calculator on me but that sounds about right.

So this is your break even point, any hour you make less than this you are losing money.  This is also a good way of monitoring what hours you are  most profitable so as to figure out what your schedule should be.

Al

Can I join in?  This is a revolutionary financial Planning!--- A KEY TO FINANCIAL FREEDOM   And this will help a lot of our friends here to maximize earnings and be productive too...so it would be a lot of fun to be part of this

Congratulations Al! 
This club will create its significant mark on the forum and we believe --- >  You are the MAN!

[al-of-gold]

Sure Athena, I already know you are an intelligent person and any imput from you will be greatly appreciated!

I believe you manage a hotel am I right?

Al

[Falcondfw69]

Actually Al, she is a motivational speaker and a management consultant.

[Athena]

Sure Athena, I already know you are an intelligent person and any imput from you will be greatly appreciated!

I believe you manage a hotel am I right?

Al

Hotel!  God, i wish!    But yes, my first job when I was 18 is at the Front Office or Front Desk... and got promoted  as Sales Executive.   But I am not anymore at the moment in this industry.
 
I am managing my own (small time) training  and development firm right now.  I am actually a  neophyte on business ideas... I am happy you put up this club.  And I will for sure gather brilliant ideas to make myself more equipped....I will look forward to look for more opportunities to make the most of this club.  We have a lot of brilliant forum members who are already  experienced in this line of vocation.  And I can't wait to read  their posts next time.

Take charge as always and I know you can run this club successfully.

[al-of-gold]

Thank You for the compliment Athena, and you are right as there are many very intelligent people in these forums and as a team we can all prosper over time.

Another area that I just thought of is retirement savings and mutual funds!!

Any others will be greatly appreciated as the more heads we put together the better.

Al

[Athena]

Thank You for the compliment Athena, and you are right as there are many very intelligent people in these forums and as a team we can all prosper over time.

Another area that I just thought of is retirement savings and mutual funds!!

Any others will be greatly appreciated as the more heads we put together the better.

Al
[/quote]


Al, try to look into retirement plans with health/protection benefits.  For sure it can maximize your protection and savings too.

[al-of-gold]

Thank You for the compliment Athena, and you are right as there are many very intelligent people in these forums and as a team we can all prosper over time.

Another area that I just thought of is retirement savings and mutual funds!!

Any others will be greatly appreciated as the more heads we put together the better.

Al

Al, try to look into retirement plans with health/protection benefits.  For sure it can maximize your protection and savings too.


[/quote]

Well Athena...here in Canada healthcare is free so its not as important...but yes I see your point.  Most large companies provide this type of insurance and pension plan for their employees, but if they don't, then I guess its up to the individual to cover themselves accordingly.

For retirement savings...I always say try to save at least 5% of your gross income and put into a tax sheltered retirement fund, if you can afford more, by all means as this is just a guidline.  The motto here is to pay yourself first! As for the healthcare part, you have to shop around for the best deal, from what I hear, in the US you have to be carefull what the lifetime limit is, because once you commit, you can't change it.  And some HMO's won't cover you for a pre-existing condition from what I hear!

The important thing here is to look out for your best interest because I always say....if you don't plan for your future....nobody will.

Al

[Athena]

Well Athena...here in Canada healthcare is free so its not as important...but yes I see your point.  Most large companies provide this type of insurance and pension plan for their employees, but if they don't, then I guess its up to the individual to cover themselves accordingly.

For retirement savings...I always say try to save at least 5% of your gross income and put into a tax sheltered retirement fund, if you can afford more, by all means as this is just a guidline.  The motto here is to pay yourself first! As for the healthcare part, you have to shop around for the best deal, from what I hear, in the US you have to be carefull what the lifetime limit is, because once you commit, you can't change it.  And some HMO's won't cover you for a pre-existing condition from what I hear!

The important thing here is to look out for your best interest because I always say....if you don't plan for your future....nobody will.

Al
[/quote]

Oh yes!  I hope to be there!  A real maximized earnings!
HMO's and Insurance Companies are not covering pre-existing conditons...and good to know your country have a well thought plan to protect the state..


And yes no one will plan for our future...We are responsible for ourselves.  NO one will dare share our troubles but us (including our families).

[al-of-gold]

That was very well put Athena!!

Now I want to share with all of you my friends something I learned in economics!  do you Athena or Falcon know what to look for when a recession is coming? There are actual warning signs but unfortunately not to many people notice them! This is why so many people lose their shirts in a recession.

think about it for  a couple of minutes and then I will post the answer!

Al