Business Start Up Term Paper

Excerpt from Term Paper :

Business Start Up

Small Information System: Profitability of a Website Business

In any business, the primary objective is to earn profits, and even the smallest business website has to be effective in earning money. In 2002, there was a survey on small business Internet that was conducted by the Verizon of Gallup and they found that as much as 55% of the small businesses on the Web covered their costs, or made money. A significant growth was recorded by 41% of the businesses. Some experts in the business now feel that having a Website is almost like having an electronic business card, and gives many people the first impression about your business. This carries forward to tell the details of appealing, information or transaction, designed for the right target audience, worthy of repeated hits, situation in updating or maintenance, speed and simplicity of loading, developing of the process of business, or developing processes that play major parts in business. (Is Your Small Business Website Profitable?)

The access to Internet is a common feature shared by almost everybody, and the Web provides more tools in research to the people including information about travel or even local restaurants. This makes an effective website an easy way for advertising the business and after the business has been able to set up its own site, and then the maintenance should be comparatively cheap. Using a website is the right method for getting an active audience. Then the people coming to the website are an active audience and keenly interested in knowing what is on offer. The other media like print advertising, telemarketing and mass mailing only provide passive audiences. When the audience is active, it is seeks information, and this can be provided by the site to give them a positive feeling. (Is Your Small Business Website Profitable?)

The advantage of having a website is that it still gives individuals the opportunity of using other methods for advertising. On the other side of the argument, the website may take a long time to load, and provide a lot of flash and fluff, but no information, and may even be out of date. This sort of an image will put the business and the related image in trouble. When a visitor is trying to find out information about a site, and is unable to find it out due to the shortcomings of the website, the individual is not likely to come again. Thus when a site is used for picking up new business, it should be used to the greatest advantage. (Is Your Small Business Website Profitable?)

Starting the business

For starting a small information system consulting business, it is best to get some card that explain the services that are on offer, and the rates should not be mentioned. When rates are mentioned, they are likely to tie the individual down to the lowest rates that he will be offering at the start of business. The main method of informing customers should be through talk. This has to be tolerated by the others involved. This is the best method of bringing in new business and this comes because having knowledge of people with troubled computers is common, and when an individual is successful, the information about the man who is able to set things right spreads. When one finally gets an opportunity, it is best to provide service in quantities more than the expectation. One has to remember that the initial jobs are only laying down the groundwork for future jobs, and this helps in getting other jobs. The best sort of job to get is of a company that does not have its own IT staff, but is already of small or medium size. This helps in getting a lot of future work, as all businesses know that time is money. They also generally pay on time, and do not store a lot of rubbish within their systems, and if by chance the job extends beyond the budgeted time, the businesses tend to pay for the extra time spent. (Getting Started In Information Technology Computer Consulting)

The home-based clients on the other side tie up the money to be paid with the price paid by them for the PC. This reduces the charges that they are likely to pay due to the declining prices of PCs. The operations of businesses are different and they fix a certain value to their time and data, and this eases up the methods of working with them. The important thing is to gain their trust, and once they are confident about capabilities, then they do not mind even if their employees call the suppliers directly. Another group of good persons are those who work out of home offices. Here also the client thinks that time is money, and they also believe in people who perform better than their expectations. When a good job has been done, it is useful to collect referrals, and for this purpose it may be useful to leave a lot of extra visiting cards with these clients. (Getting Started In Information Technology Computer Consulting)

Sometimes there may be different jobs even the location is the same. In these cases it is better to make sure that the problems in all areas are solved even though the job may be with only one part of it. Of course one has to leave details with both the parties so that one will be called later at both ends. Another important aspect is getting paid for the bills for the job done, and this has to be decided on the judgment about the party. It is better to tell people that the bill is due on receipt, but clients will still not pay on receipt. On the other side if that is not mentioned, then all businessmen would feel that the payment has to be paid within 30 days, and make the payment accordingly. Thus it is better to give a payment due notice on the bill, and when the 30 days are over, it is better to send a second invoice with a past due notice on it. In spite of all the efforts, some clients still delay their payments, and they are irregular in terms of their payment.

It is good to continue working for such clients, if one is sure that the clients are good to service. This is good for business users, but for home users, the payment has to be collected on the spot, or immediately afterwards. The payment pattern should be like a PC shop, and they expect the payments to be completed before delivering the item. Here also it is useful to apply some amount of judgment, and the problem becomes worse when the buyers ask for some item, and end up taking a lot more of attention and service than originally expected. This makes one prepare the invoice only after the job is completed and not in advance, as the estimate of charges may ultimately change. At the end of the job, one should advise the client the cost, and then send the invoice to the party by e-mail later, and after the payment has been received. (Getting Started In Information Technology Computer Consulting)

The most important point is to decide how serious one is about the information consulting business, and when serious, one has to take time set oneself up properly. This attitude pays dividends in terms of increases in revenue and savings in taxes. The office may be though about in a room in the house itself, and this helps an individual to deduct all costs related to the office from the earnings one has made as a consultant. The laws of business do not specify that a business has to be profitable, and it is enough if one keeps correct record of the expenses, even if that leads to a situation where the expenses end up being more than the income. This helps individuals who have other sources of income, as part of that income also becomes tax free, due to the losses in the business. One would definitely like to see that the business earns money, but till the time that it does not, there should be attempts to save money in all possible manner.

Quite a few items are deductible from taxes and some of them are things like insurance, utilities and internet costs, and these have to be taken in proportions to the area occupied by the business. It is important to set the unit up as a business so that the business can charge sales tax. The people in service industry sell their time, and then there is no reason why they should not sell parts also and increase the costs of the parts by 10%, so that one can make more money. Some suppliers ask the clients to purchase the items separately, and offer their services only for installation, but this is only a loss of income for them.…

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