From the April 1997 issue of Startups

New products for small and homebased businesses.

Is It Safe?

If you don't want to waste valuable time and money backing up your vital company data, there's an alternative: Connected Online Backup, an automated online PC backup and disaster recovery service, will keep this data in a remote location--safe and always accessible to you.

Connected Online Backup performs these backup tasks automatically, through either a private dial-up network or the Internet. Once stored, your data is easily accessible to you 24 hours a day, seven days a week. A password ensures exclusive access to your own files.

To use Connected Online Backup, you need a PC with Windows 95, a modem with 9,600 Kbps, and 1MB of free hard-disk space. The basic plan is $14.95 per month, which covers 50MB of transfer data, with a 25-cent incremental fee for every additional MB over 50.

To obtain a free copy of Connected Online Backup software, go to Connected Corp.'s Web site (http://www.connected.com), or call (800) 353-3078.

What A Card

Announcing a product vital to anyone who feels like just a face in the corporate crowd: Busicard Cartoon business-card holders, just the ticket to leaving a lasting impression with potential clients.

Busicards, designed to hold standard-sized business cards or pre-paid phone calling cards, are both functional and creative. Just place your card inside these holders, which feature one of eight humorous cartoon designs on the front. Also, for a final touch, there's room on the inside of the holder to leave a personalized message.

Busicards allow for inexpensive and effortless marketing of your most important product: you! It's your face and business the client will remember upon discovering your Busicard holder among stacks of other business-card clones.

Busicard Cartoons sell for $35.05 (plus $3 S&H) for one pack of 100. Choice of one design per pack.

From the Hendrickson Studios, Rockford, IL. To order, call (815) 965-0936.

Message In A Bottle

Having a pen pal has always been a popular way to learn about foreign locales and make new friends. Accessing the Internet to do this may be hot, but sending a message in a bottle has historical precedent and an air of romance.

The Castaway Message-in-a-Bottle kit gives your customer everything he or she needs to send a message to sea and, hopefully, get a reply. Included is a simulated U.S. passport, a sheet displaying the word "message" in eight languages, a watertight capsule, and a souvenir log booklet containing launch information and possible bottle routes. Also included is a one-year subscription to "Scrimshaw," a quarterly "Newsletter for Castaways," which teaches basic oceanography.

Wholesale price: $7.98 per kit. Suggested retail price: $19.95. Minimum order: one case of 15 kits.

From Christensen Designs, Manteca, CA. To order, call (800) 928-9111.

Climate Control

Proper insulation of perishable food products is something many people are concerned about, particularly those for whom almost every meal is "a moveable feast."

To help set their minds at ease, offer your customers the revolutionary Thermalwhiz Classic 6 Can/Lunch Cooler. This cooler is lined with Therma-Flect Insulation--an advanced insulation material which keeps hot food hot and cold food cold. An Easy-Clean inner lining zips out for easy cleaning. Your customers can say "goodbye" to peanut-butter-and-jelly and "hello" to hot soup, chilled pasta salad, and peace of mind.

The "Classic 6" model, a 6-pack-sized lunch cooler is available in blue, purple or green. Supplementary ice pack is included. Wholesale price: $7.45. Suggested retail price: $14.99. Minimum order: one case of 12 units.

From California Innovations, Willowdale, Ontario, Canada. To order, call (416) 590-7700, ext. 226.

Barter Boundaries

By Karin Moeller

Bartering-the symbiotic exchange of goods and services-is the basic principle at the root of all commerce: A loaf of bread for a spool of thread. For many businesses today, though, bartering is also an effective way to cut costs, by offering goods and services instead of cash.

But, beware: In the eyes of the IRS, bartering is considered business-and the exchange of any goods or services that would otherwise produce income is therefore considered taxable by law.

For example, if you have an agreement with a house painter for a new coat of gray on your home, in exchange for a year's worth of bookkeeping duties, know that the fair market value of both these services must be reported on your federal income tax returns. The fair market value is what would be charged for those items to any other customer in a regular business transaction.

If you barter through a formal barter-exchange company, you should receive a form 1099-B, "Proceeds from Broker and Barter Exchange Transactions," or similar statement by January 31 of the following year. On it, you'll find an itemization of the value of cash, property, services, credits or scrip you received from exchanges during the previous year. This income must be included on your year-end business income tax return.

For more information about barter reporting laws, call the IRS at (800) 829-3676 to order Publication 525, Taxable and Nontaxable Income.

Added Incentive

How can you, the owner of a growing company, motivate and reward your employees without shorting company capital? By using incentive pay programs.

Karen Jorgensen's Pay For Results (Merritt Publishing, $29.95, 800-638-7597) illustrates that in today's economy, it's no longer feasible for most companies to pay traditional raises and bonuses. These extra labor costs compound annually and take their toll on your company's payroll budget.

"Incentive plans are simple cash awards tied to the sales, profits, customer service or quality goals of a company," explains Jorgensen. They can be presented in the form of cash or other noncash rewards, such as time off, company gifts, special meals and vacations.

There are many types of incentive plans, including: profit-sharing programs, which distribute profit according to predetermined profit-margin formulas; gain-sharing plans, based on cost control or productivity improvements; and the more commonly known sales-incentive plans, based on commissions or other sales criteria.

According to Jorgensen, you must have a solid foundation before implementing an incentive plan. First of all, your employee's base pay must be industry-competitive. Only after this basic need is met will incentive pay begin to work effectively. Secondly, communication is critical: Your employees must clearly understand your company's goals, the incentive pay program's parameters, and how they can measure their progress.

Incentive plans not only help to keep your labor costs down, they also help to organize and give structure to the fulfillment of your business goals. Jorgensen shows you how, by implementing a well-thought-out and simple-to-understand incentive program, you and your employees can build your company together. -Lela Kim

On The Rise

According to a recent survey by the National Foundation for Women Business Owners, in 1996, women-owned firms accounted for one-third (36 percent) of all firms in the country, provided employment for one out of every four (26 percent) U.S. workers, and generated 16 percent of the nation's business sales.

If you're one of these entrepreneurs, or know one who is, be sure to get a copy of Women Succeed in Business-A Success Guide for Women Entrepreneurs. Available (for free-every start-up owner's favorite price!) from the Interagency Committee on Women's Business Enterprise and the National Women's Business Council, the booklet features women whose businesses have grown through partnership initiatives with the federal government. For a copy, call (202) 205-3850, or fax (202) 205-6825.

Q & A

By Melisa Giordano

Answers to your small-business questions.

Q: I am interested in starting a health-food store, handling top-grade vitamins, minerals and organic fruits and vegetables. Is there a manual I can obtain to get me started in business?

Josie Fontana

Antioch, Indiana

A: Provided by Ken Howard, president of Rocky Mountain Nutritional Foods Association, and owner of three natural-food stores.

To be successful in this type of business, you need to acquire an understanding of the following:

A few basic retailing concepts, like turnover, markup, advertising and basic bookkeeping;

The amount of capital required to start the kind and size of store you have in mind, including the money needed to keep your doors open until you reach profitability;

The importance of location, including visibility, parking, ease of access, the neighborhood, and amount of traffic;

The per-capita income level within three miles of your location. This will play a part in the sale of your products, because statistics show that people who are better off financially tend to be more health-conscious; however, the area where you open your store does not need to be a wealthy one.

Nutrition and health-food issues. The natural-food business and alternative-health movement are built on staying well-informed. You need to present, or have readily available, information about how certain nutritional elements support the function and structure of the body.

An understanding of these and other issues will come mostly through personal experience, but you can also gain knowledge from various reading materials. The following magazines are excellent sources of trade information for this industry: Whole Foods, (908) 769-1160, subscription cost $50/year; Health Foods Business, (516) 845-2700, subscription cost $40/year; and Natural Foods Merchandiser, (303) 939-8440, subscription cost $60/year.

Also, be sure to contact the Small Business Administration office in your area for personal service and helpful booklets. They are always a good place to begin when looking for sound start-up advice.

In addition, after you have laid the foundation for your own business, you need to go to other health-food stores to see what works in terms of product mix, decor, ambiance, advertising, etc. I suggest visiting stores outside your proposed retail area, as owners will more likely share information with you if you are not a direct competitor. If you are starting a relatively small store and there are already large stores in the area, you will have to determine your particular USP (unique selling proposition), or niche, based on your strengths.

Ask the following questions of the store managers or owners you interview:

Who are your distributors, so I can contact them to learn about their products, services and terms?

What type of advertising is the most effective?

What is the average wage level you pay your employees?

What are the typical questions most customers have when they come to you?

What particular problems did you have to cope with in your own start-up process?

If, for any reason, the people with whom you speak are unwilling to provide you with information about distributors, Whole Foods magazine publishes a list of suppliers and distributors in their special "13th" issue each year.

Also, Entrepreneur Media Inc. publishes Business Start-Up Guide #1296, Vitamin & Health Food Store, which explains, step by step, the information you'll need to start a business like this on your own. To order, see page 81, or call (800) 421-2300.

Finally, for more information on the Rocky Mountain Nutritional Foods Association, write to 511 South, 880 West, Orem, UT 84058, or call (801) 224-2987.

To be a success in the health-food industry, make sure you have adequate nutritional information, spirit of service, and the desire to make your customers' lives better through better nutrition.

Correction

In our February "Computer Ease" column (p. 12), we listed the incorrect telephone number for GoldMine Software Corp. The correct number is (800) 654-3526.

Address your small-business questions to: Q&A,Business Start-Ups, 2392 Morse Ave., Irvine, CA 92614, or e-mail them to 76711.1724@compuserve.com or BSUMag@AOL.COM. Due to limited space, time and resources, we can answer only those Q&A letters chosen for publication. Questions may be edited for clarity.