Partnerships are not just for business partners

Lately, I have been pondering the pertinence of positive partnerships. To be successful in business and in life, pursuing a proclivity for partnerships should be paramount to your plan.

The better the relationships you can establish with employees, vendors, customers, the community, and friends and family the more success you are apt to achieve. Let’s look at some powerful examples.

Partnerships with your employees: I’m not talking about giving all of your employees stock or equity in your business. I am referring to having a great relationship with your employees so that they can be counted on to work hard and do the best job that they can for your company. Share the love. You have to be symbiotic in your partnership relationships and give back equally so that your employees feel the same about working for you. This is often expressed in the culture of your business and in general how well you treat your employees. Do you orchestrate fun team-building events with your employees? Do your employees understand how they fit into your business plan? Is helping their fellow employees a given, or are bad attitudes permeating your place? All employees should treat their fellow employees as partners, providing them with the same excellent service they would offer a paying customer.

Partnerships with your vendors: Often a sea-saw relationship exists with your vendors. Let’s face it, you want the best deal you can get at the best price. They want to make the most profit from your account with the least hassle. The better your relationships are with your vendors, the more likely they will come through for you in hard times, allocate goods to you, their best customers, during scarcity of goods, or hold off on price increases. Vendors will tend to pay more attention to their best customer if for no other reason than financial considerations. Do you consider your vendors to be part of your team?

Partnerships with your customers: Unless you provide some incredibly scarce product, with few competitors, treating your customers well is paramount to your success. Are you striving to develop and maintain excellent customer relationships? Your customers, their repeat business, and word-of-mouth referrals, are the solid foundation you need to grow your business.

Some questions to ponder: Do you know your best customers’ names? Do you know what they typically order? Do they know that you will go above and beyond to help them get what they want? Are you considered part of their team?

Partnerships with your community: For most small businesses, it is important to be engaged in your community? Are you a participating member of your local Chamber of Commerce, MeetUps, relevant associations and/or non-profit charitable institutions? When you give back to your community with your time, your money, and your talents, the personal and professional benefits are numerous.

Volunteering as chairman of Manasota SCORE and Realize Bradenton affords me the opportunity to really get to know the community. I cross paths with many wonderful people who are partners in creating a great “place” where we want to work, live and raise families.

Getting to know your employees, vendors, customers and community. As an employer, I recall taking 20-minute walks around the parking lot with individual employees to discuss business and sometimes personal issues important to them. Being out of the office gave me the opportunity to dismiss all distractions and focus on them. I was told that this was appreciated and that I was a good listener. I think the secret is simply to truly care.

Fostering excellent relationships with vendors took a similar path. Really getting to know my vendor contacts, their management and/or ownership helped to cement business and, sometimes, personal relationships. Touring vendor facilities and having them tour our operations, gave everyone a better sense of how the entire process works.

Developing affinity programs, special discounts or other ways to get to know your customers are all pluses. It can be as simple as sending cards for special dates such as birthdays, anniversaries, or emailing “thought this would be of interest to you” items.

Remember the Cheers Bar, a place where everybody knows your name. People are busy, but they tend to respond affirmatively to those who truly care about them.

When you call on clients — One of the best things you can do is take a prospective or existing client to lunch and never discuss business. Talk about their goals, their families, their hobbies, their travels, even their dog. Whatever, just not business! This is a great way to get to know the individual and build that all-important partnership relationship with them.

I encourage you to develop strong partnerships with all of the groups mentioned in this column and enjoy your many resultant successes. Partner on!

Chapter 74

The latest in small office equipment

Published: Monday, July 27, 2015 at 1:00 a.m.

I've had a laser printer on my desk for approximately five years. Occupying 18 inches of desk real estate, this machine is truly amazing.

It performs four functions very well -- print, copy, scan and fax -- yet the cost is reasonable. My machine has never had a break-down. The only thing I need to do is feed this machine plain paper and occasionally buy an ink toner cartridge. The quality is superb and it's almost magic that I can print without wires at amazing speeds.

Just a few decades ago, I needed three separate devices to fax, copy and print. Scanning documents and sending by email didn't exist.

These marvelous devices, known as "all-in-ones," continue to evolve.

In an effort to learn what is in the crystal ball for all-in-ones, I interviewed Tom Monczka, ink jet product manager for Brother International. What follows is an extract from our conversation.

Q: Should you buy ink jet or laser?

A: A lot of businesses start with a home-based machine and eventually outgrow the potential that machine offers. As print volume increases, there is usually a need to step up to a more business-capable machine.

Ink jets are great for small to medium business-level volume. Perhaps one ream of paper (500 sheets) per month is a good fit for an ink jet model.

Laser technology is designed for higher volumes and are offered as single function or all-in-ones. Lasers print higher volume, faster speed and can provide cost savings as volume increases.

Q: What about color versus black ink?

A: Ink jet mono printing can be as low as a penny per page or closer to five cents per page for color (color plus black).

Laser quality produces crisp text and sharp graphics. Stepping up to color will cost a little more, but it could be worthwhile in terms of the impact on your business.

Running out of ink is a problem. Users in a focus group expressed their greatest pain points when printing important documents and running out of ink. It's a good idea to have that extra cartridge on the shelf.

A: Is faxing still popular? Most people scan and email more than they fax. This has been an ongoing trend for a while. There are three-in-one machines available if there is no need for a fax function. However, certain industries still require fax capability.

Q: What about cloud services?

All-in-ones are offering cloud services or cloud computing. Essentially, a cloud service offers data storage in an off-site location. They allow access to your cloud service directly from the machine. For example, Evernote is used for note taking and archiving, collaboration and sharing.

This can be accessed directly from the machine's touch screen where it's linked to the account. You can scan documents to your Evernote account without a computer.

Other examples would be Google Drive or Dropbox, designed for storing files. These cloud services are used to store documents, photos and videos. These can also be accessed directly from the all-in-one machine. Touch-screen devices are emulating smart phone interfaces which provides vibrant color, impressive color reproduction and usually a large enough size so that a computer or a laptop is no longer needed. These services can be accessed directly from the machine.

The future is now. There'll be more seamless integration of services. The all-in-one will not be viewed separately from other aspects of the way you do business.

Other developments

• Free cloud apps. Brother, as an example, offers cloud apps that capture and convert documents directly from the machine. A feature called scan to office will scan a document into a Microsoft Office format such as Word, Excel or Power Point. It then becomes a native document in that format instead of standard optical character recognition (which identifies text but prevents images from being manipulated). This will scan the document and send it to the cloud for processing and conversion into the Office format chosen. Select the Word, Excel or Power Point format to transfer into, and you now have the document as if it was created natively within that application.

• Mobile. Mobile device compatibility such as printing from tablets or smartphones is a big issue. You can wirelessly print from a tablet or mobile phone directly to the machine, while some applications also support scanning. Two examples of commonly used mobile printing solutions are Air Print (Apple) and Google Cloud Print (Android).

• WiFi Direct. This is a standard that allows communication between two devices without a wireless router. It enables you to print directly from your smartphone to your all-in-one device without using a wireless router in the household or business environment.

• Manufacturer apps. These are playing an important role in mobile-device printing. For example, a standard application will provide printing capability and a manufacturer's app will add the ability to scan or the capability to check the ink level status from your machine.

• Near Field Communications (NFC). This is available on select machines. NFC is a standard that allows direct printing or scanning from a mobile device. If you have visitors to your office, you can provide them access to either print or scan to your device without logging on to your wireless network.

It's called touch-to-connect technology. By bringing your mobile device close to the all-in-one, the printing initiates, providing convenient and quick access to your documents.

NFC and WiFi Direct are currently available. WiFi Direct is becoming more popular and is a standard feature in many models in the business segment. NFC is also becoming more popular, but it is typically only available on select models.

It’s not how much you make, it’s how much you keep. Sure, we all have to pay taxes and die. Let’s discuss the former, which is a comparatively more pleasant issue than the latter.

I recently interviewed Bert Seither, a vice president with 1 800 Accountant. We discussed tax strategies and structuring a business in order to pay less in taxes. He is not an attorney and is not offering legal opinions, by the way.

Q: Why should taxes be a concern for small business owners?

A: Eight or nine out of 10 people in the United States pay more in taxes (annually) than any other expense, often more than mortgage payments, rent, food, insurance and groceries.

The question should be not how much money am I making but how much money am I actually keeping? Over the years, I've found many people do not initially think that way when they're starting a business. After they've been in business a while, they realize they're stroking checks to Uncle Sam. Then it's time to do something.

Q: Different forms of businesses will inevitably lead to different tax structures. What type of legal structures or entities should a new business owner consider?

A: There are a lot of options. Initially, I found that a lot of people end up doing nothing at first, meaning they're a sole proprietorship by default. It's probably easiest to do nothing and get started in running a business.

Q: In the long run, couldn’t this end up being a more-costly option?

A: It doesn't cost anything to set up a sole proprietorship. But as a sole proprietorship, your taxes can get extremely high, depending on what state you're in. You may have state income and federal income taxes. You also have self-employment tax on top of that, which is currently levied at 15.3 percent. It can leave you scratching your head at the end of the year, asking, "What happened to all my money?" when you're paying 30, 40 percent or maybe even higher in taxes.

Q: What are some of the better options?

A: LLC's tend to be a common choice with business owners today; S Corporations, as well, especially for small businesses. There's really not a one-size-fits-all approach. Definitely get some legal and tax advice when deciding what entity to set up. The LLC is a flexible entity, because it's got the least amount of paperwork involved. You’re not required to have corporate minutes and meetings as you would with a corporation.

Q: Isn’t the LLC known as a hybrid entity?

Q: It's a cross between a sole proprietorship and a corporation. An LLC does not come with an inherent tax structure. You don't choose at the end of the year, when it's time to file your LLC's taxes, you choose in the beginning. This selection has to be done within 75 days of forming your LLC. You do this by making what's called an entity classification election.

Q: Does the entity election occur once, or could you change the tax structure of your LLC during the existence of the LLC?

A: You can change, but once you pick something, you have to stick with it for five years. If you've missed that 75-day window, which a lot of people do (because they didn't know they had an option), there's a revenue procedure that can be used to change it between Jan. 1 and March 15 of the following year. It is very common to see an LLC making an entity classification election to be taxed as an S Corporation.

Q: Does that mean that you're actually setting up an S Corporation?

A: You're always an LLC. You have the phenomenal benefits of asset protection, limited liability, et cetera, but you can get the tax benefits of a corporation. It's all about the reduction of self-employment taxes.

The S Corporation is another common structure because it is a pass-through structure, meaning you’re not having to deal with the double taxation of a C Corporation. With the S Corporation, there are basically two ways to take money out of the business.

Q: What are the two ways?

A: You have to pay yourself what's known as a "fair and reasonable salary." Even if it is a one-owner S Corporation, you would be an employee of your company and have a W-2 from your company at year-end. Your company is paying half those taxes for you, which is a deduction for the company. Then you pay the other portion. About 50 percent can be distributed to you via a K-1 form. The beautiful thing about this is there are no self-employment taxes on money distributed via a K-1.

Q: If you have an S Corporation or an LLC taxed like an S Corporation, it appears that you can reduce your self-employment taxes by about half?

A: Let's say you had a profit of $100,000 in your business. You were a sole proprietorship and you didn't do anything. Self-employment tax, at 15.3 percent, times $100,000, is $15,300. If you have an LLC and you tax it like a corporation, an S Corp, or if you have an S Corporation, you could take some of the money out as a salary.

Call it $50,000 as a salary. The other $50,000 is distributed to you. There are no self-employment taxes on the distributions because it's through the K-1. In this example, you cut your self-employment taxes in half, so you’re saving over $7,000.

The bottom line is a little bit of paperwork and a little bit of understanding and proper structuring in the beginning can actually save a significant amount of money. I like to use the old truism, "Don't trip over pennies to get to dollars."

Q: If you had an LLC, you could also choose to have it taxed as a partnership. What is the effect of doing this?

A: That would be true if you have a partner. If it's a single-member LLC, it's defaulted to a Schedule C. If it's a multi-member LLC, it's defaulted to a 1065. In essence, then, it's treated tax-wise the same. If you have a partner, you can still elect to tax it like a corporation to reduce those self-employment taxes.

Bert, enough about taxes, let’s talk about death so we won’t feel so bad about taxes.

A drone just downed an airplane, which hit our building. Several employees are injured and your office is destroyed.

It's an emergency, and police, fire and other first responders are everywhere. The press wants to speak with the owner of the business and building, and perhaps that’s you.

How will you react?

In another scenario, you are being interviewed at a convention and your mug will be on the evening news tonight. Perhaps you have an important message to convey or a new product to promote. The media is covering the event and you are not sure what to do or say, or how to relate to the reporter.

According to Eric M. Seidel, CEO of The Media Trainers LLC (eseidel@TheMediaTrainers.com), “With the Internet today, there are so many media opportunities and challenges today, every business owner needs to be prepared. Frankly, I believe it is not a matter of if, but when they’ll have the need to confront media. It may be proactively, or reactively, perhaps in times of crisis.

"All the media possibilities are there for a business owner to use to reach audiences, and the owner needs to be prepared for when audiences need to know what he/she thinks, or has done, or is doing.”

Here are nine general tips.

1. You can’t control the interview, so don’t try. You can and need to control your own spoken words and your emotions. Relax and stay in control.

2. Decide what messages are important to convey and work them into the answers, as appropriate. Don’t ramble. Don’t script specific answers to anticipated questions that probably will not be asked.

3. Develop relationships with the media by becoming a reliable source and subject-matter expert. Provide background information and be helpful, even when the story doesn’t directly pertain to you or your company.

4. Make sure your non-verbal cues show you are interested in talking with the media. Relax and use your hands conservatively to convey your message. People believe what they see more than what they hear. Your body language shouldn’t contradict what you are saying. Don’t wring your hands, because it may look like you’re hiding something. Use open hand gestures, with palms up.

5. Your eye contact should be with the reporter. Don’t be distracted by TV monitors. Don’t talk into the camera unless you are being interviewed remotely. Talk directly to the reporter.

6. Use your personality, emotions and experience to help you get the facts out. Persuasiveness comes from being credible, believable and reliable.

7. When you are asked tough questions, know what story you want to tell and tweak your answers to fit the questions appropriately.

8. TV interviews consist of sound bites, which make headlines. Deliver clear, succinct statements as you would in your elevator speech. Provide memorable sound bites that convey the key points you wish to make. Never say. “No comment.”

9. Content should be delivered in a crisp, clear and newsworthy way.

According to The Media Trainers, “analysts, investors, regulators, legislators, competitors, clients, prospects, family, friends ... You make impressions on all of them, and each can impact your business goals. How are you helping mold those impressions? How do you want them to perceive you? What do you want them to think, and even repeat?”

It’s probably a good idea to learn specific communication techniques. Develop and deliver a persuasive message to your target audience. In addition, be able to answer questions responsively, but on your terms, and from your perspective.

It pays to retain a public relations professional – remember the Boy Scout motto and “Be prepared.” It doesn’t cost a lot to retain a PR professional. In an emergency, you will be glad you did.

According to Eric Seidel, “Crises come in different sizes, but there are procedures that should be in place and ready to execute, no matter how serious the situation. All are designed to bring things back to normal quickly and with as little external damage as possible.

"In times of crisis, you need to react quickly and transparently. It’s important to have a plan that sets specific ground rules while also helping to establish that you are the best source of accurate, honest information.”

In normal times, develop a public relations campaign to showcase your company milestones, new hires, products/services, location moves, awards and other newsworthy events. From time to time, you have to toot your own horn -- no one else will.

There is a saying in crisis management: “Tell it all, tell it fast, tell it straight.” Follow this advice as you establish a public image for your company.

It takes money to make money.

I have heard this statement many times and I’m sure you have, too. But is it always true? Do you need money to make money? Well, yes and no. Lets’ examine the “no.”

How you can get access to funds for your business?

The situation: You want to start a business and have little to no money saved. Banks won’t lend you money for a speculative venture. Financial institutions are risk averse and are not venture capitalists. You don’t know what to do or where to turn.

Let’s explore some creative options and two new loan programs.

■ Friends and relatives: You could ask your uncle Tony to invest in your business idea. If that doesn’t work, perhaps Tony will loan you the money with favorable terms to get started. Sure, “net whenever” would be great terms, but it may not be realistic. Depending upon how wealthy Tony is, the amount you request may be insignificant to him. There are some important questions to ask and answer: Has Tony made investments like this before? Did he make a return on his investment? Do you want to risk your relationship with Tony for the chance to be successful with your business idea?

■ Your idea: It certainly helps to have a great idea. That’s a given, but not necessarily the most important factor. Are favorable market conditions making it the right time to launch your product or service?

■ Management expertise: Have you succeeded in the past with this type of business. Were you successful with other types of businesses?

Will your previous experience contribute to the success of your new endeavor? Do you have a good track record?

■ Business plan: Have you created a detailed business plan by thinking through the many tasks and variables that you will need to accomplish to be successful? Do you have an anticipated budget? Have you put together a cash flow analysis of inflows and outflows, and thereby determined how much money you will need and when you will need it? Do prospective customers want the product or service you will provide, and at what price? How do you know? Do you already have customers?

Other alternatives for financing your gig:

■ Credit cards: If you are fairly certain you will be successful with this venture and have nowhere else to turn, you can always use Uncle VISA. This can be a risky decision but it may be your only choice. You do what you gotta do.

■ Other assets: Perhaps you have other assets you can sell to raise enough money to start your business.

■ Equity: Do you have investors that want to be part of your venture and are willing to put up some money to purchase an equitable interest in your business? Do they have the expertise you need? Do you want partners? If yes, you should create a payment method for you to buy their equity at a future date.

It is in everyone’s best interest to establish up front a way for them to cash out.

SCORE is a resource partner of the SBA and provides an excellent series of five workshops called “Simple Steps for Starting Your Business.”

Included are the tools and techniques you will need to plan and start your new business. You can also request free SCORE mentoring at www.Manasota.SCORE.org. SCORE can help answer one question for you or you can develop an ongoing relationship that can last years, and all mentoring is free.

“Building Bridges for Entrepreneurs” is a new initiative of SCORE working in conjunction with the Manatee Community Federal Credit Union in Bradenton. MCFCU helps you, as an individual, improve your personal credit and FICO score, thereby building your personal credit capacity.

Then, assuming you have a profitable business, the chance of obtaining a business loan is increased and contingent upon establishing a working relationship with a SCORE certified mentor. For more information contact Manasota SCORE at (941) 955-1029.

The Enterprise Florida Microfinance Guarantee Program has been created to stimulate access to credit for entrepreneurs and small businesses in Florida by providing targeted guarantees to loans made to them. It is available to qualified businesses that demonstrate adequate historical and/or proposed cash flow coverage and other credit underwriting metrics.

The parameters are as follows: 1. The loan guarantee may not exceed 50 percent of the total loan amount.

2. The program is limited to providing loan guarantees for total loan amounts of at least $50,000 and not more than $250,000.3. The maximum term permitted for Microfinance support is three years.

4. Under no circumstances will a loan guarantee be permitted under a scenario that allows the Partnering Lender to incur less than 50 percent risk of loss (based on the total required financing).

5. The credit of the state or Enterprise Florida, Inc. may not be pledged except for funds appropriated by law to the Microfinance Guarantee Program.

The state is not liable or obligated in any way for claims on the program or against Enterprise Florida Inc. or the department.

If you are interested in this program, the application also states that the borrower must be an entrepreneur or small business located in Florida, employ 25 or fewer people, generate less than $1.5 million in gross revenues for the past two years.

For more information go to www.floridajobs.org/microfinanceprograms or contact Garry Thomas at Florida Department of Economic Opportunity in Tallahassee at garry.thomas@deo.myflorida.com or call (850) 717-8479.