Ask Entrepreneur - Marketing

Marketing

How is the value of existing inventory determined?

I'm currently contemplating the purchase of a manufacturing company that has been in operation for many years. Part of the agreement would be that the current inventory levels would be maintained and included in the sale. How does one go about determining the value of this inventory?
Brad Sugars
Marketing

What's the best way for a small manufacturing company to obtain corporate clients?

We are a small ammunition manufacturer looking to place our product on store shelves. Currently, we do mail-order ammunition sales to consumers, but would like to expand and get our product on store shelves. What is the best way for us to approach this? Would we set up a consignment deal or contract purchase? What do stores look for in small companies before they decide to put our product on their shelf? I will be the one spearheading this expansion and need some direction for information or advice. Thanks!
Brad Sugars
Marketing

How do we determine volume discounts?

My company sells a software product (soon to be more products). I have been asked a few times about volume discounts, but am unsure how to decide what to offer. Do I offer breaks at 10 units? 50 units? 100 units? How much of a break do I offer? Do resellers get less of a discount than a big box store? What about non-profit discounts? I don't want to offer such large discounts that I'm stuck when Wal-Mart comes calling (dream on!). What is a good way to break out a discount structure? My profit margins are fairly good, but if I sell for much less than 50 percent off, I'm not really making enough money to run operations and grow the business.
Brad Sugars
Finance

How do I keep my business credit separate from my personal credit?

When I set up my business bank account and obtained a business credit card, they asked for my personal and business information, even though the business is an LLC. Will the business accounts show up on my personal credit history? Is there a way to keep business and personal credit histories separate?
Pam Newman
Growth Strategies

How do you know when it is time to sell, retire or refuel?

I started my small business 22 years ago and have enjoyed a measure of success. I am tired of looking for the right person to take over, tired of training the ones I think may work and tired of managing employees. I love my business and the freedom it gives me, but after 33 years I'm looking forward to retiring, but don't know how. As a service business, I don't think I can get what I need if I sell it. Companies want me to stay on, which defeats my purpose!
Tim Berry
Finance

Is there a target return that I should be looking for when I invest in a company?

I'm thinking of investing in a startup, but I don't know how to determine if the projected return is acceptable. In the first year, the business will need capital equipment costing approximately $100,000 and the operating costs will be around $90,000 (including lease payments) in its first year. It should break even in its second year and be generating positive cash flow of around $60,000 after that. The total investment is $190,000 and the return over 5 years would be $300,000. Should I be satisfied with that ?
Tim Berry
Growth Strategies

Does it make sense to accept services in exchange for hours I've worked?

I recently started an IT consulting business and have joined with a phone communications company. The phone communications company has given me several referrals for which I have worked about 82 hours. The owner has done a few wiring jobs for me and wants to trade those services instead of paying me. He already gets 50 percent of my hourly pay for all of the referrals and bills these customers directly.
Tim Berry
Starting a Business

Should I obtain insurance for a small home based baking business?

I would like to start selling homemade baked goods such as cookies, bars and candy. I will start selling them at craft shows for now to see how well they sell. But I'm worried about allergies people may have to ingredients in my product. I am concerned that if someone gets sick, I'll get sued. Is a list of ingredients on the product enough to protect me?
Nina Kaufman
Finance

Can you deduct startup costs for a business that had no sales until the next year?

We started a business in 2007 but didn't start selling our product until 2008. Are the 2007 startup costs deductible on our 2007 taxes?
Nina Kaufman
Starting a Business

How do I establish a U.S. based business while I'm traveling abroad?

I'm an American citizen, but I've been living in Turkey for the last couple of years. I'm opening a translation agency while traveling abroad, but want it to be based in America for tax purposes. What legal hurdles may I encounter while trying to do this?
Nina Kaufman
Marketing

How do I raise prices without scaring away my clientele?

I have been in business since 2002 and the cost for the services I provide have never increased. With the cost of overhead more than creeping up each year, my profit is at a standstill and I feel as though I am running this business just to make a living for everyone around me. How do I increase the cost of services without losing the clientele I have worked so hard to build?
Pattie Simone
Marketing

How do I raise prices without scaring away my clientele?

I have been in business since 2002 and the cost for the services I provide have never increased. With the cost of overhead more than creeping up each year, my profit is at a standstill and I feel as though I am running this business just to make a living for everyone around me. How do I increase the cost of services without losing the clientele I have worked so hard to build?
Kim T. Gordon
Starting a Business

How do you partner with an existing company to produce and market your idea?

I have an invention, but not the capital to produce it. Who do I contact at the company and how do I know they won't just steal my idea? Can you patent an idea?
Kim T. Gordon
Growth Strategies

How do I determine a price for buying out an equal partner?

We are not getting along very well and I want to buy my partner out. She asked if I was close in making an offer.
Tim Berry
Finance

How do we determine our salary without consistent income?

My husband and I started a consulting/contracting company last year under an LLC. We are co-owners and have no employees. Due to the nature of our business, we do not have a consistent income. We bill our clients when the next phase of the job is set to start. There can be weeks or months between payments as we have to wait for other contractors to complete parts of the job before we begin our next phase. Without knowing exactly when and how much money is coming in, we can't set salaries for ourselves. How do we pay taxes if we are not showing an income through payroll?
Pam Newman