All posts by Steve C

Why You Should Worry About Your Topline More Than Your Bottom Line

My wife and I constantly discuss different ways to build our overall wealth. Our goal is to retire and be able to spend all of our time with our children. We’ve tried a lot of different things over the years, but our most miserable experience arose when we decided to drastically cut back on our bottom line expenses. I think we started doing this after I read the book “The Millionaire Next Door” which is a book about how most millionaires become wealthy by being extremely frugal and compounding their money over time. So we tried being frugal,...

5 Reasons Why You Should Quit Your Job

For some reason, it was especially difficult for me to get up out of bed this morning to get ready for work. As I was getting dressed, I stood there looking at my wife who was sleeping blissfully on the bed and I couldn’t help but feel a little jealous. My wife was sleeping in because she recently quit her day job in order to spend her full time with the kids. “Okay honey, I’m going off to work now!” I hollered hoping she’d stir a bit. “Hey, did you know that I was trying...

How to Choose a Shipping Carrier (USPS, UPS, FedEx)

Assuming you ship physical goods to your end customer, at some point you’ll need to figure out how you will be getting your products to their destinations. There are a multitude of different ways to ship packages and it can get quite confusing deciding what the best option is for your online store. I’ll provide a breakdown of the 3 biggest shipping carriers and when or why you should ever use them. I will rate these 3 services based on following criteria: price and reliability. United States Postal Service (USPS) Price USPS is by far the cheapest shipping option...

Customer Stories – Should I Go Through With the Marriage?

I don’t know why, but for some reason, our customers always want to tell me their life story when they make a purchase over the phone. They nonchalantly ask me about the merchandise and then slowly steer the conversation towards what’s going on in their life. In some extreme cases, they ask me for advice, not on the products mind you, but on personal life decisions. My wife says that I’m extremely polite on the phone with customers but I don’t think that I come across as a psychiatrist! In any case, the following lady clearly...

Customer Stories – The Customer Who Didn’t Care

We get a lot of customers who purchase our linens on behalf of a large organization or for a specific event. This particular customer managed a local charity that supports children born with a certain disease (I’m keeping the specific charity anonymous for privacy reasons). She was looking for personalized handkerchiefs to congratulate all of her kids for persevering at an annual charity picnic. Sounds like a very sweet gift right? Customer: Yes, I’m looking for some handkerchiefs that I can purchase in bulk and have a short message embroidered on them. I run a local charity...

Corporate Structure: Is a Limited Liability Company (LLC) For Me?

I think of limited liability companies or LLCs as a hybrid between an S corporation and a sole proprietorship. LLCs, like S Corps and sole proprietorships, are pass through tax entities in that taxes on income are filed under an individual’s income tax return. The LLC also provides limited liability protection. The main advantage of LLCs is that it can provide you with limited liability protection without the hefty paperwork requirements of corporations. So what questions should you ask yourself? Corporate Structure Legal Structure Overview Sole Proprietorship Limited Liability Company S Corporation C Corporation Do You Really Need Limited Liability? The LLC is very...

Corporate Structure : Is a C Corporation for Me?

I used to think that C corporations were meant only for large successful companies. When I think of C Corps, I think of big names like Microsoft, Google and IBM and definitely not a small business. In reality, it’s pretty easy to become a c corporation. Anyone can file for C corporation status, but typically small businesses shy away from C corps until they are solidly profitable. Because the C corporation is probably the most complicated corporate structure that you can possibly have, there are a lot of questions that you should ask yourself before you...

Corporate Structure : Is an S Corporation For Me?

In general, S Corporations are valuable when you require the limited liability protection that a corporation provides and when your business is not profitable. S corporations are pass through entities which means that all income is passed directly to the shareholders who pay taxes under their own individual income tax rates. As a result, the S corporation itself does not have to pay any federal income taxes. Before electing to create an S corporation, here are a few questions that you should be asking yourself. Corporate Structure Legal Structure Overview Sole Proprietorship Limited Liability Company S Corporation C Corporation Do You Absolutely Require...

Customer Stories – Blind Leading the Blind

Sometimes there are products that we carry that I’m not intimately familiar with. Because buying and stocking items for our online store is primarily my wife’s responsibility, she has much more knowledge about our products than I do. Fortunately, I don’t have to take that many customer support calls so my weaknesses are not often exposed. However, every now and then, I’ll get a customer that truly tests my knowledge. This was one such customer who pushed me to my limits. Customer: Yes. I’m looking for some linens that I can use to host a tea party. Me: We...

Corporate Structure: Is a Sole Proprietorship For Me?

If you fear excessive paperwork and you want to keep it simple, then a sole proprietorship is the way to go. Establishing a sole proprietorship is so easy, that you don’t have to do anything at all. By default, the IRS considers all business owners sole proprietors. Because going with a sole proprietorship is stress free and easy, many people stay as solos early on. Since everyone has their own situation however, below are a few questions you should ask yourself. Corporate Structure Legal Structure Overview Sole Proprietorship Limited Liability Company S Corporation C Corporation Is Liability a Concern? Are you selling items or...

The Top 10 Mistakes of Online Store Website Design

The design of your website is one of the most fundamental aspects of your online store. You must consider what your customers will find appealing even though it may not necessarily match your tastes. In addition to the aesthetics, there are many structural guidelines that should be followed as well. As I look at online stores across the web, I still find that many people are making fundamental mistakes with their websites. Below are a few of the most common. Busy Backgrounds or Flashing Text There’s nothing more annoying that a busy, gaudy background. Even if...

How to Obtain Your DBA (Doing Business As) or FIC (Fictitious Business Name)

DBA,or doing business as, is a legal term that is used when your business is operating under a fictitious business name instead of the owner’s name. For example, “The Gap” is a fictitious business name because the name of the business does not include the names of the store owners. Because it is impossible to know who is actually responsible for the business from a fictitious business name, the government requires you to file a DBA statement in the interests of consumer protection. It’s different in every state, but in the state of California, not only do you have...

Customer Stories – Cheap Anniversary Gift Return

With every store, you’ll inevitably attract a certain class of customers that will only shop in your bargain bin. These people will skip all of your nicer merchandise and go straight for the cheapest stuff that you carry in your store. Often times, these people will also ask for a further discount as well on top of the already heavily reduced price. We had one of these customers purchase the cheapest item in our store for $6.50 the other week. Quite frankly, the set of handkerchiefs he chose were kind of ugly. They were not...

5 Things to Look For When Sizing Up Competitors

Unless you are selling products that you invented yourself, chances are that you’ll have direct competitors in your space. If you don’t think you have any, then chances are your market is so small that you’re probably not seeing much demand for your products anyways. It’s important to keep track of your competition on a regular basis to see how your store sizes up. It’s also important to check the web periodically to see if new competitors have popped up. With our store, we perform thorough web searches on our key product lines at least once...

Customer Stories – Wedding Day Disaster

This particular customer from the east coast purchased some wedding handkerchiefs from our online store about 10 days in advance and had them delivered directly to her wedding venue. The one mistake she made however was that she addressed the package to her maid of honor instead of either herself or the wedding planner. As a result, the people at the wedding venue had no idea who the handkerchiefs belonged to and the package got lost at the wedding venue itself. So the day of the wedding, we received a bunch of calls. Since, we are on the...

Customer Stories – Exploiting Chinese Labor

Every now and then, we get a customer that drives us totally insane. While it isn’t fun to deal with these customers, working with these difficult people make for great stories to tell our friends. This particular customer that I’m writing about was a very headstrong lady that gave us a really hard time about our products. Customer: “Yes, I’m interested in your linen towels. Where are they from?” Me: “Many of our products are from Asia. These particular towels are made in China.” Customer: “Hmm, China huh? Do you happen to know whether these towels were created...

How to Deduct Your Home Office on Your Taxes

In order to deduct your home office, your business must follow the following rules. Your home must be your principal place of business. This means is that you conduct all of your business related activities in your home and you have no other set locations where you do business You must have a special area sectioned off for your business. This might be a separate room or the garage. Anywhere that you store inventory or products counts as well. You must actually conduct business at home and use the dedicated space solely for business. This one sounds like a no...

How to Deduct Equipment and Supplies on Your Taxes

The biggest advantage for small businesses is a little Internal Revenue Code known as Section 179. Section 179 allows small businesses to deduct up to 108k (Note: This number changes every year.) of assets completely every year. What this means is that you can deduct up to this amount in business equipment, computers, furniture etc… without having to worry about depreciation or other tax calculations. Of course, section 179 comes with a few requirements that must be met. Purchases must be used mostly for business The official rule is that the asset that you are deducting must be used...

How to Deduct Entertainment and Meals on Your Taxes

Deducting entertainment and meals is often a gray area that people take advantage of. My general rule of thumb is that as long as you don’t abuse the tax code, you should be fine. I use what I call the “bullshit” code. If I can tell my wife with a straight face that a particular expense was used for business purposes, and my wife doesn’t think its BS, its usually good enough for me. Officially though, anything you expense must obey the following rules. The entertainment expense must be reasonable and accepted in your field of business – For...

How to Deduct Travel Expenses on Your Taxes

Ever heard your spouse complain that you never go on enough vacations? Using your business as a tax shelter is a great way to fund your next vacation without breaking the bank. With proper planning, you can get your business to pay for and write off most of your trip! For starters, the trip’s primary purpose must be for business. As long as your destination is not completely random, chances are you can find a way to do business there. Below are some general guidelines on what and how you can deduct during your travels. ...