First Get The Customers, Then Set Up The Business Cliff Ennico www.creators.com "For the past several years, I've been working for our state university. They have a toll-free 'hot line' where people can call with questions about their trees and shrubs, and I'm the person who gives the answers. We get tons of questions every day, and I'm thinking there's a business opportunity for someone to go out there and provide one-on-one consulting. I am worried, though, about how best to protect myself against lawsuits - is it better to take out liability insurance, or form a corporation or limited liability company (LLC) to run the business? Doing both seems a little like wearing both suspenders and a belt - you don't need both." Sounds like you're having trouble seeing the forest for the trees (sorry, I couldn't resist that). The first thing you need to do is find out if there's really a business here. Just because people are calling a toll-free line and getting free advice over the phone does not mean they will actually shell out their hard-earned cash for the same advice, no matter how good it may be. Before spending any money on setting up an LLC or taking out insurance, I would throw together a quick-and-dirty marketing brochure, get it out there, and see if homeowners really will bite. If they don't, then you won't have to spend any MORE money to shut down the LLC, close out the insurance policy, etc., etc. If the customers really are there, the next question you need to ask is: how much will I get paid for this? You are going to be spending considerable time visiting each customer, looking at their landscape layout, putting together a proposal, and so forth, and the hours are going to rack up quickly. I'm not sure most homeowners are willing to spend $100 or more an hour for advice on their shrubs - realistically, you are probably going to be charging something in the $20 to $30 range for an hourly fee. If it takes you 10 hours to advise a client, and you charge $200 for your services, that's only $20 an hour. Not bad, but you are going to need to have tons of customers at that rate before you earn a six-figure income from this business and quit your day job. Only when you know the customers will be there, and the economics make sense, do you start putting things like LLCs and insurance policies in place. How much protection you need, of course, depends on the real likelihood of your getting sued. If you are giving advice on chemical treatments, for example, you will need not only a belt and suspenders for this business, but a suit of armor as well - one sick kid (or pet), and you're toast. Even if you form a corporation or LLC for your business, I usually suggest that people carry liability insurance for the LLC's (and their own) "errors and omissions". If someone is injured because of your bad advice, and a nasty judge sympathizes with them and sees you have only $100 in the LLC checking account, he or she will be sorely tempted to "pierce the LLC veil" and give the plaintiff access to your personal assets. Having an insurance policy for the plaintiff to go after will make it easier for the judge to respect the limited liability your LLC offers. One more thing: make sure you check with the university and make sure you haven't signed anything that would prohibit you from doing consulting work on the side. I take it you are not quite ready to quit your day job at the university yet. Even if you haven't signed a formal noncompete agreement, I would run this by your immediate supervisor before taking any action. University people sometimes get prickly about their employees doing outside consulting work for real money (jealousy probably has something to do with that), and you're usually better off disclosing your plans up front than having them "catch" you doing it behind their backs. Cliff Ennico ( cennico@legalcareer.com ) is a syndicated columnist, author and host of the PBS television series 'Money Hunt'. His latest book is 'Small Business Survival Guide' (Adams Media, $12.95). This column is no substitute for legal, tax or financial advice, which can be furnished only by a qualified professional licensed in your state. To find out more about Cliff Ennico and other Creators Syndicate writers and cartoonists, visit our Web page at www.creators.com . COPYRIGHT 2006 CLIFFORD R. ENNICO. DISTRIBUTED BY CREATORS SYNDICATE, INC. Permission granted for use on DrLaura.com. More >>

Something All My Own Owning my own business has taught me many things about myself. I've learned that I can make wise business decisions, I can manage the accounts and taxes for my company, and I can type with one hand while holding a sleeping 6 month old. All of these things have helped me develop into a much more confidant person. My business has also given me the freedom to test my limits and see what I can accomplish. Running a home-based business has become a large part of my identity. Not in a selfish, "See what I can do!" way, but in a positive sense. It has given me the confidence to know that I accomplish things that I never thought possible. Before I was a work-at-home mom, I wanted to be able to be at home with my children, but I also felt that I needed more. I needed something for me alone that would make me feel strong and confident. I also needed the opportunity to keep in touch with others to avoid the isolation that often accompanies stay-at-home moms. There are three keys areas in my life that I believe my home-based business has helped me develop: Passion When I began my website it truly was something for ME. I wanted to compile work at home information all in one spot so that I could find the perfect opportunity that would allow me to stay at home with my children. However, in running CWAHM I have found that I have a passion for helping other moms work from home. My business has taught me that to succeed you must give to others and expect nothing in return. This may not seem like a sensible business technique, but it is a biblical principle. Put others before yourself, help others to succeed and you will be successful yourself. Gina Neef with The MOM Team, told me recently, "I didn't realize I even wanted "something of my own" three years ago. When I began - it all unfolded... so nice to have my passion fueled." Confidence In college I was shy and very unsure of myself. I felt like there was not any one thing that I was truly good at. My grades were average, my athletic ability was average, and on and on. Being a successful business owner has opened my eyes to the fact that there are things that I am good at. Melody Spier, owner of Ballyhoo Virtual Services , felt similarly. She states, "Owning a business has taught me so much about myself and my capabilities. I used to let fear of the unknown, fear of success and of failure hold me back, but now that I'm a business owner, I've learned that it's okay to succeed at some things and fail at others. I take each experience and learn from it - what worked, what didn't? Today if I want to do something but don't know how, I find someone who has knowledge of the topic and I ask for help. Owning a business has taught me to believe in my skills and myself. My fear of success has long since vanished as well; I can now say that I'm proud to own a successful virtual assistant business." Courage Being a business owner has given me courage. Courage to take chances and go beyond my comfort level. Once I have a few successes behind me, I realized that I could do it all. Also, even my failures make me stronger. I found that my business didn't shut down with each mistake I made and I always found a better way of doing things. Diana Ennen, president of Virtual Word Publishing , agrees. She states, "Owning my own business has inspired me to do more in all aspects of my life. I love the warmth of success so I try and take the right steps to achieve it. Just as I want the best for my family, I also want the best for my business as well. I'll often find the courage to go the extra mile and reach far beyond what I think is possible and what I find is that most of the time, I reach those goals." Having "something all my own" has benefited me in many ways - passion, confidence, courage - and so much more. I've been inspired to do things that I never thought possible. If you desire to work from home you'll find that it's worth the time and effort that it takes to get started. Take the chance, step out on faith and work until you succeed. ABOUT THE AUTHOR:Jill Hart is the author of the e-book, 2 Weeks Devotional Journey for Christian Work at Home Moms, and the founder and editor of Christian Work at Home Moms, CWAHM.com. This site is dedicated to providing work at home moms with opportunities to promote their businesses while at the same time providing them spiritual encouragement and articles. Jill's work has been published across the internet, including DrLaura.com. She also has work published in the Xulon Press book, I'll Be Home For Christmas . Visit http://www.CWAHM.com for additional information. This article is free to reprint if the Author's Bio remains in tact. For additional articles, please contact Jill Hart. Permission granted for use on DrLaura.com. More >>

Marketing Offline Can Substantially Increase Your Online Business by Jill Hart The Internet can be a scary place for those looking for a home-based business opportunity. The fear of not connecting personally with others is one concern and many people have been "taken" by online scams in their search for a legitimate business and are fearful to take any more risks. One way to overcome fears such as these is to market your online business locally. By simply offering the person a contact that they can speak to and possibly even meet face to face you will making the statement that your business is legitimate and trustworthy. It is effective to market your online business locally primarily because potential customers and business recruits prefer to have the option of speaking with the business owner face to face. By attracting customers locally, you can maximize the opportunities to meet with them. You will no longer be that "someone they found online," but someone that they will be able to relate to and feel confident doing business with. But how do you market locally? Here are some excellent tips: Besides the common local advertising routes, such as Newspaper Ads, Yellow Pages, Etc., another effective (and inexpensive) way to advertise locally is to post business related flyers around your community. Many grocery stores, libraries, bookstores, and office supply stores offer bulletin boards for this purpose. Make yours stand out and be recognized, yet professional enough to warrant someone trusting you with their business. Also, if possibly have a tear-off section on your flyer so they can take your number and leave your flyer. Look for events geared toward work-at-home businesses. There are organizations, such as the National Work at Home Mom Association, that hold events across the nation to help promote the work-at-home business owner. At events such as these, you can purchase a booth and make hundreds of local contacts, as well as sales, all in one day. Reach out to your community. Join your local Chamber of Commerce, get involved in community events and become known to those around you. Pass out flyers and hand out business cards to everyone you meet. Door Flyers also work well for marketing - pick one neighborhood a week and go door to door. Be consistent with your marketing with door flyers, too. If a potential customer sees your ad repeatedly, they will feel more inclined to use your services in the future. Magnets can be great promotional items as well. You can have magnets printed with your business information and hand them out to people that you speak to about your products. Potential clients can keep these on their refrigerator or filing cabinet. You can also leave flyers, magnets or even catalogs around town in places like doctor's offices, hair salons, etc. Volunteer in your community for marketing success. Diana Ennen of Virtual Word Publishing, Inc. suggests, "Volunteer at school events such as PTA meetings or community functions. When your child's school needs a flyer, volunteer to do it and attach your card to it. Look to see where you can also inexpensively advertise. Often ads in the kid's yearbook or community events newsletter will get your more exposure than the expensive ads in the daily newspapers." Direct mail is another great tool for gaining local clients. Get the Yellow Pages out and write a professional letter or send your brochures or postcards to those that would be interested in your products or services. Send a mailing to local businesses that may be interested in offering your products to their customers. For example, if you sell home decor products, send a professional letter to real estate agents in your local area. In the letter, describe how your products would be valuable for them to use as thank you gifts when they sell a home. It's important to talk to everyone you possibly can about your business. You can find prospective customers in line at the grocery store, while waiting at a doctor's office, or even while playing at the park with your children. Let others know that you are excited about it and believe in it. If the people around you hear the excitement in your voice, they may become excited about your business, too! You'll be rewarded with more sales and a business that prospers from year to year. ABOUT THE AUTHOR: Jill Hart is the founder and editor of Christian Work at Home Moms, CWAHM.com, and the author of the e-book, The Two Week Devotional Journey for Christian Work at Home Moms. The CWAHM.com website is dedicated to providing moms with free resources to aid them in their work at home search. E-mail Jill at jill@cwahm.com for additional information or stop by her site at www.cwahm.com . Permission granted for use on DrLaura.com. More >>

You Know A "Derivative Work" When You See One Cliff Ennico www.creators.com "I am a public relations consultant who works out of his home. To promote my firm, I have written several articles for my local business weekly newspaper, without charge, and posted them on my Website. Well, I must be doing a pretty good job at these, because a regional business magazine contacted me and asked me if they could reprint one of my articles in the magazine for $250. I said 'sure', of course, but then they hit me with a 10 page contract they want me to sign. It looks pretty harmless overall, but there's a clause in there that says I'm assigning to them all of my rights to this article and any 'derivative works'. Does that mean I can't write on this topic ever again? I would love the free publicity this article would provide, but I'm not willing to put limits on my writing activities for a mere $250." Whenever you look to publish an article or book with an established publisher, they will want you to sign their standard "publishing contract". Generally, you should not sign these without having your lawyer look at them first (most lawyers will do less for less than one hour of their time if you ask nicely), but in this case the fee you are being paid is so small it probably isn't worth bringing an attorney on board. Generally, when you write an article or any other "original work", you own the copyright to it from the moment it is created, even though you don't "register" your copyright with the Library of Congress in Washington. The only way you can lose that copyright is to sell or assign it to someone else. So in this case, even though your articles appeared in the local business newspaper, the copyright is yours and no one can reprint it without your permission (for which, of course, you will charge a fee). Most publishers will want you to "assign" your copyright to them in the contract. What the publisher doesn't want is to publish your article and pay you for it, only to have you then turn around and sell the same article to other publishers. When you think about it, that's a pretty legitimate concern, and the publisher is unlikely to strike the "assignment of rights" clause if you ask them to. If the publisher's contract requires you to assign your copyright to "the Work" (usually a defined term in the contract), you should look at the definition of "Work" very carefully. Usually, it refers only to the article you are submitting. You are not prohibited from writing articles on similar topics, or from taking pieces of your article and using them elsewhere, as long as you don't take the article verbatim, word for word, and sell it to someone else. When I negotiate publishing contracts, though, I always add a sentence clarifying that you may "copy or reprint the article, either in written or electronic form, and use it solely for promotional purposes." That way you can put the article up on your Website, along with the wonderful tagline "reprinted with permission of XXX magazine". In your contract, however, the definition of "Work" is slightly broader, and includes not only the article you are submitting to the magazine for publication, but also "derivative works" of that article. The term "derivative work" is defined in the federal copyright laws as "a work based upon one or more preexisting works, such as a translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adapted." Not exactly a model of clarity, is it? A "derivative work" is a bit like the famous U.S. Supreme Court judge's description of pornography: you can't define it precisely, but you know it when you see it. Common sense will rule the day here. If the magazine publishes your article, and you change just a few words and sell it to another publisher, the magazine is likely to look at that as a "derivative work" of your article, and will be very upset. Likewise, if you read your article word for word into an audio recorder and post it as an "audio clip" on your Website, that is probably also a "derivative work". Generally, however, another article on the same topic - using entirely different words than your published article - will not be a "derivative work" and the magazine will have no rights to it, as under the copyright laws it will be considered a separate, "original" work. Likewise, taking just one paragraph from your article and including it in another, original article on the same topic, should not get you into hot water with your publisher. Still, since this is only going to be a one-time publication in the magazine, I would ask the publisher either (1) to clarify in writing that other works on the same general topic will not be considered "derivative works" under the contract, or (2) to make the assignment of copyright "nonexclusive" six months after the article appears in print in the magazine. That way, the publisher has the right to control publication that they want, while you have the peace of mind that you need. Cliff Ennico ( cennico@legalcareer.com ) is a syndicated columnist, author and host of the PBS television series 'Money Hunt'. His latest book is 'Small Business Survival Guide' (Adams Media, $12.95). This column is no substitute for legal, tax or financial advice, which can be furnished only by a qualified professional licensed in your state. To find out more about Cliff Ennico and other Creators Syndicate writers and cartoonists, visit our Web page at www.creators.com . COPYRIGHT 2006 CLIFFORD R. ENNICO. DISTRIBUTED BY CREATORS SYNDICATE, INC. Permission granted for use on DrLaura.com. More >>

Some Taxing News From France For Ebay Sellers Cliff Ennico www.creators.com #147;When I sell stuff on eBay to people outside the United States, do I have to be concerned at all about paying taxes in foreign countries?#148; For most eBay sellers, who sell only occasionally to buyers in other countries, the short answer is #147;no#148;. Most foreign countries tax their citizens on goods they bring into the country #150; these taxes are commonly called #147;value added taxes (VAT)#148; or #147;general sales taxes (GST)#148; #150; but sellers who reside in the United States are not required to collect the tax or add it to the purchase price of the goods sold. It#146;s the buyer#146;s problem. As an honorable member of the eBay community, though, you should include a statement in all your auction pages as follows: #147;Buyers living in countries outside the United States may be required to pay value added tax (VAT) and other taxes on their purchases on eBay. Please consult your tax advisor for advice before bidding on this item.#148; Once you start selling lots of goods outside the United States, and especially once you start selling regularly on eBay#146;s overseas Websites (such as eBay France, eBay Italia or eBay UK), you have to start being concerned about foreign taxes, laws and regulations. A recent case out of France highlights the kind of legal hassles a serious eBay seller can encounter when his or her selling activities cross national boundaries. In this case, a professional art dealer in the United States was clobbered with thousands of Euros in fines because he was operating a business in France illegally without registering to obtain a commercial vendor#146;s license, as French businesses are required to do. The record showed that the dealer sold more than 470 statuettes, vases, and other art objects to French citizens on eBay France. The defendant claimed he was not a professional seller, having acquired his art objects from flea markets and personal relatives, and that he sold the items on eBay #147;to appease his girlfriend who threatened to move out if he did not get rid of the clutter#148;. The French court did not buy that argument. Under France#146;s commercial code (and those of some other European nations), whether or not you are a #147;professional#148; depends largely on whether or not you are selling things on a regular basis while taking measures to make profits and using the proceeds to make a living. For example, someone who buys rock concert posters in the United States with the sole purpose of reselling them in France for a profit would be considered a #147;professional#148;, even if he is not based in France or conducting his business from a physical location there. While the French case should not lead U.S.-based eBay sellers to #147;block#148; citizens of other countries from bidding in their auctions, eBay sellers need to be aware that many countries are likely to require them to pay their income, sales and other taxes #150; and comply with their commercial laws and licensing requirements -- if some of the following conditions apply: the seller is clearly engaged in business online and is not selling on eBay merely as a #147;hobby#148;; the seller posts its auctions directly on the local eBay platform (for example, eBay France), rather than on the U.S. Website; the seller#146;s auction pages are in the local language and currency, and are clearly #147;targeting#148; citizens of the host nation; and the seller is selling significant quantities of goods to citizens of the host nation on a regular basis (in other words, not just occasional sales of items the seller thinks might generate local interest because of their subject matter or content). If you find yourself in this situation, the best advice is to hook up with another eBay seller who is a citizen of the host nation, and either (1) have that person act as your local #147;agent#148; and #147;distributor#148;, hosting your eBay auctions in that country, collecting the winning bids, and dealing with the local laws and taxes, or (2) have that person act as an #147;advisor#148; to help you comply with whatever laws, taxes, regulations and other requirements the host nation may impose. For a fee, of course, or a percentage of your winning bids in that country. You can find eBay sellers in other countries on the #147;eBay International Board#148; chat room (pages.ebay.com/community/chat/index.html, click on #147;eBay International Board#148;). Be sure to check their feedback thoroughly before doing business with them, especially if they are located in a country that is prone to fraudulent online activity #150; a list of such nations is maintained and updated by the international Merchant Risk Council ( www.merchantriskcouncil.org ). Cliff Ennico ( cennico@legalcareer.com ) is a syndicated columnist, author and host of the PBS television series 'Money Hunt'. His latest book is #145;Small Business Survival Guide#146; (Adams Media, $12.95). This column is no substitute for legal, tax or financial advice, which can be furnished only by a qualified professional licensed in your state. To find out more about Cliff Ennico and other Creators Syndicate writers and cartoonists, visit our Web page at www.creators.com . COPYRIGHT 2006 CLIFFORD R. ENNICO. DISTRIBUTED BY CREATORS SYNDICATE, INC. Permission granted for use on DrLaura.com. More >>

Work-at-Home Scams #150; Don#146;t Become a Victim By Liz Folger, Work-at-Home Mom Expert The ads are so tempting, and just think -- what if you could make hundreds of dollars a day working from home? Unfortunately, people are losing money every day to work at home scams. Don't become a victim. Here are some ways to make sure you don't become scammed! You know you're just about to get scammed by a work-at-home ad when... The very first line states you can make hundreds of dollars a week working from home. There is no experience needed. You can work just a few hours a week and still make a bundle of money. There is lots of CAPITALIZATION AND !!!!!! used in the ad. You read an extremely vague ad. You haven't a clue what the business is about; but boy, could you be making the bucks. You're asked to call a 900# for more information. For a fee, a company will send you a list of businesses that are looking for home workers. You are forced to make a decision immediately and are made to feel stupid if you say no to their offer. How to Check A Company Out Whether you have those funny feelings about the claims of a company or not, do some background research on them. Hire a lawyer. This may seem like a waste of money, but in the long run it could really save you some financial heartache. Call the Better Business Bureau (in the state the company resides in) to see if there have been any complaints against the company. Ask the company if you can talk to any of their happy customers. Please be aware that companies can and will give you false customers to talk to. If these people sound way too happy, I would be a little leery. Questions You Should Ask If You Are Thinking About Buying A Business Opportunity Find out from your sponsor, in writing, what is involved with this business; such as: Are you able to return merchandise if it doesn't sell? Is there a money back guarantee? How long have they been in business for? (if it's under a year, I would again be very leery). What is your total cost of this business opportunity, including fees, supplies, and equipment? Will you be paid on salary or commission and how often and who will pay you? Ask the program sponsor to write down every step of the business. What To Do If You Become The Victim Of A Scam First you need to write the company that you feel has ripped you off telling them you would like your money back. If they don't agree with you, then you need to let them know you plan to notify officials. The following people should be notified: If you read about this work-at-home scheme in a magazine, let the editor know you've been ripped off by these people and you're not happy about it. The Attorney General's Office in your state or in the state where the company is located. National Fraud Information Center. Call them if you feel you are a victim of a "get-rich-quick" or an "easy money" scheme. Check out their web site for daily alerts or new scams. 1-800-876-7060 Your local Consumer Protection Offices. Your local Better Business Bureau (BBB) and the BBB in the state of the scammer. Postmaster. Notify if you received the information through the mail. The Federal Trade Commission. While the FTC cannot resolve individual disputes, the agency can take action if there is evidence of a pattern of deceptive or unfair practices. To register a complaint, write to: Correspondence Branch, Federal Trade Commission, Washington, DC 20580. Liz Folger is the founder of www.bizymoms.com . Bizymoms.com is the leading online resource for work-from-home ideas. The site offers home-based business start-up kits, online classes, e-books, chats and enthusiastic support for moms who want to have it all - a family and a career. Visit www.bizymoms.com for more information. * The author gives permission for the use of this article on DrLaura.com. More >>

When The "Three Musketeers" Ain't Nuthin' But A Candy Bar Cliff Ennico www.creators.com #147;I#146;m the founding member of a limited liability company (LLC). Over two years I let in two other members, and ended up resigning my majority ownership (stupid move). I trusted these guys. You know, we were supposed to be #145;The Three Musketeers#146;. Over the years I developed a ton of great marketing materials and created many educational, television and documentary film products for the LLC. Now I#146;ve been isolated, voted out as Manager, been completely taken out of the loop (they have a current court order against them for now showing me financial documents I#146;ve been asking for for nine months) and they#146;re trying to hold me to a broad noncompete agreement which says that any member won#146;t undertake any transactions which may be considered to be competitive with the LLC. Yet, they won#146;t let me out of the LLC either, unless I turn over to the LLC all rights that I may have in every product created by me over the past eight years. Crazy situation, huh?#148; Crazy, yeah, but not all that uncommon, as readers of this column know. Don#146;t you now wish you had a lawyer representing you when you brought in these two guys? It could have saved you a ton of grief. You#146;re obviously in litigation with your old LLC and have a lawyer representing you; I#146;m not going to say anything here to second guess his or her judgment because I don#146;t have all the facts. But it sounds like you never assigned to the LLC your copyrights in the television programs, film scripts, and other materials you created for the LLC (if you had done so, your former partners wouldn#146;t be asking you to do that now). If that#146;s the case, you probably still own these rights, and that gives you some real leverage over the other LLC members. Works created by an LLC member, unlike those created by an employee, are not considered #147;works made for hire#148; under the federal copyright laws. They have to be actually assigned to the LLC in writing. Ask your attorney if it#146;s possible to get a court order, called an #147;injunction#148;, prohibiting the LLC from using any of your creative works without your permission until the lawsuit is resolved or settled. That should get your former business partners to the bargaining table real fast. Next time you set up an LLC with someone, make sure your Operating Agreement clearly spells out that (1) you are the only Manager, (2) you can only be removed as Manager by a vote of 100% of the members (including yourself), and (3) all decisions relating to the LLC business are to be made by you alone. And if anyone ever talks about #147;Three Musketeers#148; again, offer them a candy bar. #147;I am in a rock band with some other guys, and we currently have a tax ID number. Well, our manager got a tax ID number for the band in order for us to open a business checking account at the bank. Now we have a problem because he is not going to be managing us anymore. I will be handling all of the banking transactions from now on. How do I go about getting a new tax ID number? Or, can our old manager just transfer that tax ID to be under my name?#148; It sounds like you may have a bigger problem here than just tax ID numbers. If your old manager filed for your tax ID number as a #147;partnership#148; (which is what your rock band is, legally) and named himself as a partner, he is technically your business partner, and you cannot legally get rid of him without buying him out for whatever he considers a fair price. You need to get to a lawyer, pronto, for some legal advice. If your old manager is willing to be #147;bought out#148;, make sure he assigns over to you all rights he may have in any songs or other copyrighted material you may have developed. Otherwise he owns a piece of your music going forward, and you don#146;t want that. I#146;ve said it before -- never, ever, ever form a music group without (1) a clear written partnership agreement among the members saying who#146;s in the band, who owns what songs, how band members can withdraw, and how band members can be forced out, and (2) a clear written #147;representation agreement#148; between the band and any agent, manager, promoter, or similar person who gets paid for doing anything to help the band. Without agreements, the wrong people tend to get a lot more powerful than they deserve to be. For a scary look at how one rock band really fouled up its relationship with its agent/manager, read #147;Got a Revolution!#148;, Jeff Tamarkin#146;s biography of the 1960#146;s psychedelic rock band Jefferson Airplane. These guys needed #147;Somebody to Love,#148; and they didn#146;t get one for a long, long time. Cliff Ennico ( cennico@legalcareer.com ) is a syndicated columnist, author and host of the PBS television series 'Money Hunt'. His latest book is #145;Small Business Survival Guide#146; (Adams Media, $12.95). This column is no substitute for legal, tax or financial advice, which can be furnished only by a qualified professional licensed in your state. To find out more about Cliff Ennico and other Creators Syndicate writers and cartoonists, visit our Web page at www.creators.com . COPYRIGHT 2006 CLIFFORD R. ENNICO. DISTRIBUTED BY CREATORS SYNDICATE, INC. Permission granted for use on DrLaura.com. More >>

Some Tricky Issues When you Sell Stuff On Consignment Cliff Ennico www.creators.com #147;I am the owner of an antique mall. I sometimes sell items for others on consignment, while some others pay me rent to place their items in my store. I sell the items and collect the sales tax, which my store mails in to the state quarterly. I then keep a consignment fee, and pay the excess over to the seller. The money the sellers make on their items is given to them through my business checking. My accountant claims I am to issue each of my consignment sellers a 1099 form at year's end if I#146;ve paid them more than $600.00 during the year. I am only the middleman for the transactions from seller to buyer. The individual sellers do not in any way work for me, nor do they invest time in the process of these transactions. I am told by many people in this same business that she is wrong. She insists she's right.#148; And so she is. Even though you are a #147;middleman#148;, you are legally required to prepare and send a 1099 to each consignment seller, because they have no incentive to report their receipts to the IRS. According to CPA and tax expert Joseph Sweeney ( joe_sweeney@att.net ), if you sell an antique (for more than $600) to a business, the business is required to send a 1099 to you; you then have to issue a 1099 to the original seller to establish that he or she has the ultimate liability to pay income tax on the sale. If the buyer is an individual consumer, he or she does not have to send a 1099 to you, but you must send a 1099 to the consignment seller if the #147;net#148; to the seller exceeds $600. If you pay less than $600 (total) to a seller during the year, or if your seller is a corporation or nonprofit organization, you do not have to send a 1099 at year#146;s end. If your seller is a partnership or limited liability company (LLC), you still have to send the 1099, according to Sweeney. #147;I am a very successful eBay Trading Assistant. I am trying to get some type of insurance on the items I sell/store for my client's. I currently store these items in a climate controlled storage unit separate from my office. Many of the insurance companies do not understand eBay nor offer me a suitable policy to cover this. The longer I go without the insurance the more vulnerable I feel I am as a business. Any help or advice would be appreciated.#148; According to business insurance expert Susan Krasnow ( susan.krasnow@nicholsonassoc.com ), it#146;s very difficult to get property/casualty insurance for goods you hold on consignment for others. #147;People in this type of business normally carry lots of different inventory, everything from estate jewelry to automobiles, so it#146;s difficult for insurance companies to assess the risks and write a policy that makes sense,#148; she explains. One possibility, according to Krasnow, is to contact Lloyd#146;s of London ( www.lloyds.com ), which has long been famous for underwriting risks no other insurance company will touch. Another possibility is to consider warehouseman#146;s, or bailee#146;s, insurance. While you probably don#146;t consider your business a #147;warehouse#148;, that is technically (and legally) what you are when you accept goods on consignment. If you have companies in your area that conduct estate auctions, pay them a visit, pretending to be a customer. Tell them you are very concerned about the goods being damaged while they are being held for sale, and ask them who they use for coverage. If two or more companies use the same insurance carrier, contact them and get a premium quote. When doing business on a consignment basis, it#146;s important to have a written agreement with the people who consign stuff to you (called #147;consignors#148; in legalese). A good attorney can draft one of these for you (in plain English, and no more than two pages in length) for under $500. Here are three provisions that should be in every contract for the consignment of goods: a provision that prohibits the consignor from selling the goods to someone else while you are trying to sell the goods on consignment; a provision requiring the consignor to pay you a fee (sometimes called a #147;breakage fee#148;) if they withdraw an item from consignment before the contract term ends; and a #147;successors and assigns#148; clause that keeps the contract alive if the consignor dies or becomes permanently disabled during the contract term. Cliff Ennico ( cennico@legalcareer.com ) is a syndicated columnist, author and host of the PBS television series 'Money Hunt'. His latest book is #145;Small Business Survival Guide#146; (Adams Media, $12.95). This column is no substitute for legal, tax or financial advice, which can be furnished only by a qualified professional licensed in your state. To find out more about Cliff Ennico and other Creators Syndicate writers and cartoonists, visit our Web page at www.creators.com . COPYRIGHT 2006 CLIFFORD R. ENNICO. DISTRIBUTED BY CREATORS SYNDICATE, INC. Permission granted for use on DrLaura.com. More >>

10 Ways To Market Inexpensively and Reap Big Rewards By Liz Folger, Work-at-Home Mom Expert If you#146;re in business for yourself, you have probably noticed you don#146;t have the same marketing budget as Coca Cola or Proctor Gamble. However, you still need to get the word out about our businesses. You just have to do it with a few less million dollars. Usually the first thing that pops into the mind of a new self-employed person is, #147;I have to place an ad.#148; However this can cost money. Place just a few ads and soon your marketing budget is dry as a bone. Also keep in mind that a person has to see your ad six times in the same publications before they even think of using your business. Now if that is a monthly publication, I#146;m telling you it will take you six months till a person actually thinks about picking up the phone to call you. Now that isn#146;t good news. Especially if you would like to get customers a bit sooner than that. So what#146;s a home business mom to do? Many of the self-employed moms I talk to say most of their business comes from one simple source -- word of mouth. It comes from that one happy customer who liked what they did for them and started to spread the word. What would make you want to shop somewhere? A friend telling you about a great service or product, or an ad in the paper telling you the same thing? Here are a few suggestions on getting the word out about your business in the quickest and cheapest way possible. Send out a press release, and not just when you open your business. You need to tell the world if you#146;ve added some new service or product or if you#146;re business is involved in a charity event. Be sure you give the release a human slant. Don#146;t just talk about how wonderful your business is, talk about what your business can do for your future customers. Join Organizations. Chamber of Commerce, women in business organizations, and any type of organization your target market belongs to. Put your service or product for sale in a charity auction. As soon as you start your business write every single person you know a postcard announcing your new business venture. Although they may not need your business, they just may tell someone who does. Ask for referrals from other happy customers. Cold calling will never be the same again if you use this approach. Write articles for web sites. You don#146;t need to push your product in the article. But write about your area of expertise. Then include a nice byline at the end of the article. Go to chats and visit message boards on the Internet. Make friends in cyberspace. Once again, don#146;t push your product or service on people. That will only turn them off. Instead go out of your way to help people and answer their questions. Before you know it you#146;ll be ask what type of work you do. Use those sig files at the end of your e-mails and posts to message boards. Keep them short (4-6 lines). Use all those Internet sites that offer FREE Classified ads. Host chats, and give talks at your local Rotary Clubs. Once again #150; talk about your area of expertise. Liz Folger is the founder of http://www.bizymoms.com . Bizymoms.com is the leading online resource for work-from-home ideas. The site offers home-based business start-up kits, online classes, e-books, chats and enthusiastic support for moms who want to have it all - a family and a career. Visit http://www.bizymoms.com for more information. Permission granted for use on DrLaura.com. More >>

Time To Clean Out Santa's Mail Bag [Part One] Cliff Ennico www.creators.com At year-end, I always clean out my e-mail #147;in box#148;, and there#146;s always a few e-mails from readers I didn#146;t get a chance to address during the year. Some people dream of sugar plums, others just want their two front teeth, but these folks want answers. So here goes . . . #147;I#146;m starting a auto repair shop with two friends. We#146;ve agreed to share profits equally (one-third each), but we also agree that I will run the business. How can we do that without my having 51% of the ownership?#148; Simple. You form a #147;manager managed#148; limited liability company (LLC). You would be the sole #147;manager#148;, with authority to run the business and make the day to day decisions. The three of you would be the #147;members#148;, or owners, and would split the ownership one-third each. Be sure your LLC operating agreement (similar to a partnership agreement) contains the following provisions: you cannot be removed as Manager unless all 3 Members agree (including you); each year the three of you will meet to determine how much you can take out of the LLC checking out as compensation for your management services #150; if you can#146;t agree by March 31 of any calendar year, your compensation will remain the same as it was in the previous year; and any decision requiring the vote of the Members (such as mergers, asset sales or bankruptcy) must be made by 100% vote. #147;My friend is in a partnership with two other people for a dance studio. My friend owns 60% of the partnership. In the past few months, her other two partners have forced her out of the business #150; first they changed the locks on the doors, then they refused to schedule students for her. Is there anything she can do to keep this business from being stolen out from under her?#148; Oh, the joy of partnerships! It sounds like your friend has been a #147;doormat#148;, letting the other partners walk all over her, as is common in these situations. With 60% ownership, though, she is someone who #147;must be obeyed#148;, whether the other partners like it or not. Let#146;s just hope there#146;s something in writing somewhere saying she does indeed own 60% of the partnership. If there is, then your friend should have a lawyer write a letter to the other two partners (send it by registered or certified mail), which will read something like this. #147;As we near the end of the calendar year, I need to know how much I will be making from our partnership. As a 60% partner, I am legally entitled to 60% of the profits from this business. As soon as you receive this letter, please render an accounting of the revenue, expenses and profits of this business since January 1, 2005, and be prepared to write me a check for 60% of the profits on December 31. If any of you have taken out more than your percentage share of the profits (40% for the two partners combined) in compensation, the excess must be promptly returned to the partnership checking account to avoid legal action.#148; That ought to get their attention; if they don#146;t respond, then your friend should call a #147;partners#146; meeting#148; to discuss the conduct of the business. At this meeting, your friend should be prepared to offer to sell her 60% share in the business to the two other partners. They obviously want to move forward without your friend, and that#146;s okay as long as they pay your friend something for her contribution to the business thus far. #147;I#146;m thinking of starting a business with a software programmer. Are there any special rules about doing business with programmers?#148; Not really #150; partnerships are partnerships no matter who you have them with. Still, I would be wary about giving a programmer ownership of a company unless he has developed the software product you are selling, and is prepared to work 24/7 to keep that product up to date. If you own the software, and he#146;s just providing labor, don#146;t make him a partner until he proves to you just how indispensable he is to the product#146;s success. More next week . . . Cliff Ennico ( cennico@legalcareer.com ) is a syndicated columnist, author and host of the PBS television series 'Money Hunt'. His latest book is #145;Small Business Survival Guide#146; (Adams Media, $12.95). This column is no substitute for legal, tax or financial advice, which can be furnished only by a qualified professional licensed in your state. To find out more about Cliff Ennico and other Creators Syndicate writers and cartoonists, visit our Web page at www.creators.com . COPYRIGHT 2005 CLIFFORD R. ENNICO. DISTRIBUTED BY CREATORS SYNDICATE, INC. Permission granted for use on DrLaura.com. More >>