# Working on starting a business



## enpgroup (Nov 20, 2011)

I'm working on starting a business, any advice on how to start one up? How much does it usually cost of fees and such?


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## infinitewisdom (Jan 23, 2011)

You've left out so much information. I do not even know where to begin.


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## All in Twilight (Oct 12, 2012)

Ask me anything...

But I can advise you to pay a visit to the chamber of commerce anyway or check out their website.
What is your product?

In any way...failing to prepare is preparing to fail.


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## jbking (Jun 4, 2010)

enpgroup said:


> I'm working on starting a business, any advice on how to start one up? How much does it usually cost of fees and such?


My advice is to consider what parts of running a business do you know well, what parts do you want help, what mentors do you have to help, and last but not least watch your costs in the business as initially it may take rather sizable investments in terms of money, time and effort.

Depending on numerous factors the cost can range from $0 to the millions of dollars if you are buying a franchise which could be interpreted as "starting a business."

Course more detail would make this easier to answer you realize, right?


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## kudi (Sep 27, 2011)

Step one: start it. 

Everything else you pick up and learn. Once that is done get a mentor or get in contact with local government office, they'll usually advise you.


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## Agile (Sep 27, 2010)

Probably wouldn't hurt to do some market research - try talking/interviewing people you feel are in your target market and get a sense for where they are underserved and then try to empathize and build your business around that problem.


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## Peter (Feb 27, 2010)

enpgroup said:


> I'm working on starting a business, any advice on how to start one up? How much does it usually cost of fees and such?


Here's the thing you need to put most focus on (the fees stuff and usual costs are requirements but don't guarantee success.)

SALES & MARKETING!

I'm an engineer so don't think I'm preaching my own stuff here. But a business needs money to come in and often all the energy goes into the product with the idea that if sales are not going as they should, making the product better will fix that.

It Will Not!

Sales and marketing are an art of their own and you need to master them in order to have a successful business.

Good luck!


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## enpgroup (Nov 20, 2011)

I want to do entertainment stuff like movies, dvds, indie movie screenings. Stuff like that and later branch out other stuff later on in media, even inventions. I want to learn more about marketing as well. Though my main focus is creative driven stuff, not a franchise but an artist driven movie studio and eventually get successful and make it bigger and better once good work made their financial success as well as advertising, subscribers, and other multiple sources of income to help fund for stuff.


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## Razare (Apr 21, 2009)

enpgroup said:


> I want to do entertainment stuff like movies, dvds, indie movie screenings. Stuff like that and later branch out other stuff later on in media, even inventions. I want to learn more about marketing as well. Though my main focus is creative driven stuff, not a franchise but an artist driven movie studio and eventually get successful and make it bigger and better once good work made their financial success as well as advertising, subscribers, and other multiple sources of income to help fund for stuff.


I'm an accountant, and I have no experience with that industry... but the basics apply to all businesses.

A) You start a list of what you need, in order to do what you want to do. Think of everything you have to have, but leave out things you don't need in the beginning. What is important is having the things you need to generate income from customers.

B) Price your list of start-up necessities.

C) Figure out what your known monthly expenses will be, using best estimates. This includes utilities/telephone, renting office space, credit card payments if you used that to finance some things, and other things like labor.

D) Figure out what you're selling and for how much, and how much of what you sell is cost of goods sold. So if I make a pizza, making that pizza costs me so many dollars of ingredients. In a service-industry, if you're the only doing the labor, then your labor is essentially free at first... meaning you just worry about what supplies you might go through, which is usually negligible. Still, it's a consideration.

E) Then figure out how much in sales revenue you'll have to do in one month to pay for all your monthly expenses. (Keep in mind, you're calculating Sales Revenue minus Cost of Goods Sold. This is called Gross Revenue, and it is what you subtract monthly expenses from.) When you figure out the Sales Revenue needed to pay all the bills, this is what we call a break-even point. You need to make at least this much to stay-open... if you don't make this much, you'll have to supply the business cash to keep it operational. If you're doing an at-home business with you as the sole employee, then your overhead is likely nothing, but as soon as you have your own facility, overhead comes into play. Overhead meaning fixed monthly expenses.

F) Have enough cash/financing to pay for your start-up needs, and also enough to survive at least a few months of paying your overhead, without having much if any sales revenue. In the business world, it's often said you should intend on not making money your first year. This isn't always true, but having 6 to 12 months of extra cash to pay for monthly expenses is a good idea.

G) Now that you know what you need to know for profitability...* you start figuring whether that's something you can achieve*, and also, what do you need to do in order to achieve the necessary sales revenue. This is where marketing comes in. You have to advertise in an effective way that brings in enough sales revenue to pay for overhead, as well as what you spend on marketing.

H) A lot of books and official materials recommend getting a lawyer and an accountant from the get-go, but I don't suggest this if you're small, as they're expensive. Doing taxes for a business honestly isn't that difficult if you keep good records. And a lawyer is generally only necessary for making contracts or resolving problems after they occur. As a studio, it might be good to hook up with a lawyer for contracts, but expect to pay an arm and a leg, since those types of contracts are likely highly specialized. If you draft your own contract well, it will withstand in a court of law, but the idea is you conduct business without having to go to court to collect on breaches of contract.

Note: Regarding the bold text above, if you cannot reasonably achieve profitability, then you give up on the idea because it's not profitable. This is where it's easy to make a mistake. Some people will do the calculation and then ignore it, pressing on with what they want to do... then their business fails and they're in debt. It's better to walk away, than enter a financial situation that can't work. If you still want to pursue your goal, you have to figure out a new way of doing it which changes the amount of expenses you pay each month... like finding a cheaper building... or not hiring anyone at first... if the equation doesn't work, something has to be done differently or not at all.

Any questions about specifics, please ask.


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## Dauntless (Nov 3, 2010)

Razare said:


> I'm an accountant, and I have no experience with that industry... but the basics apply to all businesses.
> 
> A) You start a list of what you need, in order to do what you want to do. Think of everything you have to have, but leave out things you don't need in the beginning. What is important is having the things you need to generate income from customers.
> 
> ...


Oh, @Razare, how wonderful!! I work in finance and with the upcoming tax season frustrating and seeking to generate supplement income from creative ventures in the upcoming year...just thank you (cubed!) for writing this and revealing your superpower!


Mods: How does one powerthank a post? :happy:


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## Razare (Apr 21, 2009)

Dauntless said:


> Oh, @_Razare_, how wonderful!! I work in finance and with the upcoming tax season frustrating and seeking to generate supplement income from creative ventures in the upcoming year...just thank you (cubed!) for writing this and revealing your superpower!


I'm alright with taxes, but oddly enough, it's not what I do for a job. Personal income w/ related businesses, rentals, and investments is what I know the most about tax-wise... mainly from doing taxes in my family, I've gotten to dabble in everything... even some K1's.

I've had classes on corporate, but I wouldn't say that I'm an expert in that field.

Funnily enough, I could probably run a small tax business if I got that stupid certification you need from the IRS. Just, I'm not inclined to go find clients. Working for someone else might be good, though.

As for my job, it's retail accounting, basically, and finding ways to save a few thousand here and there, out of millions... while at the same time maintaining basic controls. I get to farm the taxes out to someone else!


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## Dauntless (Nov 3, 2010)

Razare said:


> I'm alright with taxes, but oddly enough, it's not what I do for a job. Personal income w/ related businesses, rentals, and investments is what I know the most about tax-wise... mainly from doing taxes in my family, I've gotten to dabble in everything... even some K1's.
> 
> I've had classes on corporate, but I wouldn't say that I'm an expert in that field.
> 
> ...


Either way, your post was stellar, and I appreciate it. I will still be trying to pick your brain, I can't lie. :laughing:


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## enpgroup (Nov 20, 2011)

I heard the upper class, wealthiest people don't need to pay taxes. So I wonder how would one go about doing that, say if my business sky rockets, what is the fine pin point where I don't need to pay taxes / deal with the IRS, etc.


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## timeless (Mar 20, 2010)

enpgroup said:


> I heard the upper class, wealthiest people don't need to pay taxes. So I wonder how would one go about doing that, say if my business sky rockets, what is the fine pin point where I don't need to pay taxes / deal with the IRS, etc.


You will never be able to escape the IRS.


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## enpgroup (Nov 20, 2011)

I heard that if you have corporations, or something like that, you can escape paying taxes. I've learn it on this VHS tape I bought at my public library sale, it's about becoming rich.


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## ewerk (Sep 22, 2012)

What kind of business are you looking to start because that makes a difference in terms of startup costs? Online businesses are much cheaper to start than say opening a restaurant or hair salon. The cost is entirely based on the business model.


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## timeless (Mar 20, 2010)

enpgroup said:


> I heard that if you have corporations, or something like that, you can escape paying taxes. I've learn it on this VHS tape I bought at my public library sale, it's about becoming rich.


 There are ways to minimize tax liability, but schemes that suggest total tax evasion using corporations are shady. That's the kind of thing Enron tried to get away with. You should find more reliable sources of advice than VHS tapes.


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## enpgroup (Nov 20, 2011)

timeless said:


> There are ways to minimize tax liability, but schemes that suggest total tax evasion using corporations are shady. That's the kind of thing Enron tried to get away with. You should find more reliable sources of advice than VHS tapes.


Would books be better or are you referring to more on up to date material? The video was from 1991 but still sometimes it's age doesn't matter if the theories still work in general. Though it depends where it comes from. So how would using corporations be shady? Does it depend if the business is successful or not? Because I figure the more successful but more likely it would work but it's possible if it not working as well if the finactual state is below the line of anti-tax acceptance so it should be legal if it's a business is started up legally and is stable.


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## Razare (Apr 21, 2009)

enpgroup said:


> I heard the upper class, wealthiest people don't need to pay taxes. So I wonder how would one go about doing that, say if my business sky rockets, what is the fine pin point where I don't need to pay taxes / deal with the IRS, etc.


You can avoid the IRS, yes, but it's expensive.

If you incorporated in somewhere like the Cayman Islands, you could earn your profit in a country that has no tax, thus avoiding United States tax code entirely... until you brought the money back home at least.

You just need really good corporate accountants. A lot of burying profits, is creating book losses, while having positive cash flow... that's another good method.

For example, if you have a big facility, you can depreciate it... in theory it's an expense, but it's only theory, as it doesn't cost you a penny. Also, there is the domestic production credit created by Bush. That's a favorite of oil companies.

So there's all sorts of things, but you have to be pretty darn creative to do it legally.


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## Kormoran (Mar 15, 2012)

Chances are your business will fail within a year.

Try again later, chances are you'll get further, and then fail.

And then you try again, and if you've learnt from your past mistakes, you might end up successful.

But it depends on the line of business, financial climate, your own competence, your leadership skills, your management skills, your work ethic, your charisma.

It's not easy. It sounds very easy, but it's actually very hard to be successful.

Best of luck to you, though.


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