8 Days of Fear and Panic

Economics teaches us that rational thought should prevail in markets, but that's not what we've seen on Wall Street this past week. Actually we've seen 8 trading days in a row of fear and panic. Over the past 8 trading sessions the Dow Jones Industrial Average is down a whopping 2200 points. That's an amazing 22% drop in less than 2 week. For me its not a time for panic -- instead all I see is "opportunity". Time to buy and buy cheap. You are getting stocks on a 8 or 9 year discount! Buy and hold.

Saving Financial Markets

A lot of attention has been put on the U.S. Government and how they will act to save U.S. Financial and Credit markets. From the meltdown and bankruptcy of public companies like Bear Sterns to the troubles of Freddie Mac and Fannie May, the U.S. Treasury Department and Federal Reserve Bank are being looked to for help.

What does the U.S. Treasury Department do exactly?

1. Recommends and implements the economic, fiscal, and currency policies of the President.
2. Regulates exports and imports.
3. Designs, prints, and mints, all authorized mediums of exchange used by the US Government, including Currency, Coins, Stamps, and Bonds.
4. Regulates all financial institutions chartered by the United States.
5. Collects all United States Revenue.
6. Enforces all US Laws of a financial nature.

[Public Domain Photo Credit]

Vision Statements

What is a vision statement and why do I need one for my business? Seem like obvious questions right? OK, let's answer them! A Vision Statement is all about, well, vision! Taken literally it means a statement envisioning what you want to be in the future. A classic example is to the best the "Best at" something, like customer service or to have the "Highest Quality" product. The vision statement is therefore like a target your business wants to reach. This goes right into the part of "why do I need one?" Without a clear goal, it becomes more difficult to keep the business focused. When management sets strategic goals, they need a guide to determine them. The Vision Statement is the way!

Ethics in Business

Here's a tricky situation -- you work for a multinational company and are doing business in a foreign country. That foreign country has certian customs like giving gifts in business. What should you do? This is where the all important company ethics policy comes in. A company's ethics policy should be the overriding document when it comes to what is and what is not accepted in an organization. It is the source of guidance for employees when they are faced with a tricky situation.

Free Cash Flow

Free Cash Flow (FCF) is defined as the cash left in your profits after taking the Depreciation/Amortization, and Capital Expenditure off. This cash is then free to use for a variety of purposes:

• Distribute to Shareholder (as a dividend)
• Reinvest in the growth of the company (capital projects)
• Acquire new companies (acquisitions)
• Invest in stock market / securities
• Pay down debt
• Keep! (as cash on balance sheet)
  

Steps in Creating a Non-Profit Organization

Non-profit organizations are very similar to for-profit ventures and their setup follows a similar path. There are some deviations though, so I present to you a list of steps to take in forming a non-profit corporation.

1. Select a state to incorporate in
2. Reserve organization name with the State
3. Draft articles of incorporation
4. Apply for federal identification number
5. Register with the State
6. Submit articles of incorporation and fee
7. Apply for federal tax exemption (form 1023)
8. Apply for state tax exemption
9. Hold first board of trustees meeting and elect officers
10. Ratify bylaws and other procedural documents
11. Apply for local business license (if applicable)

Remember to check with your state first to find out any state-specific requirements or procedures to follow. Most states provide comprehensive guidance for free to encourage business formation.

Five Ways to Destroy Your Business

Here's a great article from About.com "5 Ways to Destroy Your Business". A must read. Methods include carrying too much unsecured debt and not paying payroll taxes, ouch! Check out all five ways and then avoid them at all costs. These should be relatively obvious but sometimes you can't see the forest due to the trees. Stay smart and stay alart -- running a business is no laughing matter.

A Business Plan in Three Parts

What does a business plan consist of? How to write one? These are very important questions. An easy way is to break the business plan into three major sections:

• Marketing Plan


• Operations Plan


• Financial Plan

The Marketing Plan will describe the business, it's target audience, the product, the service differentiators, and the advertising plans. The Operations Plan will describe how the business is executed on both sides of the equation. First the customer's experience is described. Secondly the behind the scenes operation is described including human resources, capital goods, locations and offices, and growth plan. The Financial plan should include all the basic accounting data including the projected balance sheets, projected cash flow statements, and projected income statements. The cash flow should show whether or not external financing is required and, if so, how much and when.

Proper Risk Management

Risk Management is the process of brainstorming risk events and planning for them. Additionally it involves creating a process to handle unplanned risk events as they occur during the life of the business or project. It should be understood that not all risks can be planned for -- not even all of the major ones. This is why the process is so important. It will ensure that the realized risks are handled properly when they occur and that their impact will be minimized.

Disclosure Policy

This policy is valid from 31 December 2007.This blog is a personal blog written and edited by me. This blog accepts forms of cash advertising, sponsorship, paid insertions or other forms of compensation. The compensation received may influence the advertising content, topics or posts made in this blog. That content, advertising space or post may not always be identified as paid or sponsored content. The owner(s) of this blog is compensated to provide opinion on products, services, websites and various other topics. Even though the owner(s) of this blog receives compensation for our posts or advertisements, we always give our honest opinions, findings, beliefs, or experiences on those topics or products. The views and opinions expressed on this blog are purely the bloggers' own. Any product claim, statistic, quote or other representation about a product or service should be verified with the manufacturer, provider or party in question.This blog does not contain any content which might present a conflict of interest.