Why Your Business Needs Insurance

People come up with all kinds of reasons why they don’t need insurance: my business doesn’t make money; you can’t squeeze blood from a turnip. I’m incorporated, so I’m already protected against liability. I trust my partner/clients/family not to sue me, so why bother?

Why bother, indeed? The truth is, all these rationalizations are just that: ways business owners talk themselves out of additional expenditures. But just like you wouldn’t own a car without insuring it, and just like you’ve probably got some kind of insurance on your home, your business needs the same kind of protection.*

Beyond how much sense it makes to protect something that’s valuable, there’s also a chance you could lose business opportunities if you’re not properly insured. One of my clients owns a residential cleaning company. She recently tried to break into commercial cleaning. She’s done great business for years and her clients love her, but when she started approaching restaurants to see if she could take on projects for them, none wanted to take the gamble. Why? She didn’t have insurance. Without it, they weren’t willing to deal with the consequences if something went wrong on her watch.; it would’ve cost them too much in time, money and reputation. In the end, the restaurants chose someone else and my client got insured.

But what if the thing that’s keeping you from getting insured isn’t any of these excuses but rather that you don’t know how to find the right insurer? It can be difficult to pick an insurance agent, and to be sure you’re not getting fleeced.

Before you take your first step, be sure to read this article. It explains the differences between insurance agents and insurance brokers. Different types of insurers are better equipped to meet the needs of different businesses.

After that, go to your state’s insurance department website. This will be your best resource for all insurance-related questions and concerns. You can find quotes and comparisons, buying tips, and more. Find your state’s insurance department here.

And remember: insurance agents are there to work for you, not the other way around. Always contact at least five agents to be sure you know the range of prices available. At each office, ask for a current, valid agent or broker’s license, as well as customer references. If they’re reluctant to give these out, you know something’s wrong.

Use these tips, along with the resources listed below, and you should have no problem getting the insurance you need at a price you can afford.

http://businessinsure.about.com/od/insurancecompanies/bb/chooseinsco.htm
http://businessinsure.about.com/od/insuringyourbusiness/tp/purchcheck.htm

*Oh, and to the person who thinks their business is too poor to insure, take note: everyone and every business can be held accountable. And judges can wait. Once a money judgment has been weighed against you, your wages can be steadily garnished, your equipment seized and your assets high-jacked. So, yeah. Get protected.

So You Think You Can't Dance?

That may in fact be true. Honestly, most of us can't. But entrepreneurs are nothing if not risk takers!

Tonight kicks off Waterfront Wednesdays, a FREE concert series hosted at Penn Treaty Park. Waterfront Wednesdays promises to supply tunes and entertainment all summer long from 7-9pm. Performers throughout the summer range from jump and jivin' swing musicians to tunes that are easy on the ears for those less inclined to use their feet to feel the music.

Tonight’s kicks off the series with musical guest Charanga, belting out Latin sounds and soul stepping beats. Strap on your best dancing shoes for an introductory salsa lesson before the concert, then Milonga, Salsa or listen the night away.

If you’re feeling especially inspired after the concert, consider taking up a summer hobby with the many dance studio’s in the area. Our most recent Women Entrepreneurs’ Circle met at the Angler Movement Arts Center, where attendees were charmed with the moves of the Flamenco dance class.

Want to give it a try? Two left feet? Not to worry, local instructors are waiting to tackle even the most challenging students, awakening the dancer within. Test these studios in the area to get in rhythm with the summer, and to eliminate any post workday entrepreneurial stress.

Angler Movement Arts Center (1550 E. Montgomery Avenue):

Katharine Livingston opened the Angler Movement Arts Center in 2003, after years of gymnastics, dance, and Pilates training. Her life’s work came to fruition at the center, where her team offers classes ranging from Pilates to dance and beyond. Beginning Flamenco Dance classes meet on Wednesday nights from 6:00-7:30pm with Monica Herrera.

Society Hill Dance Academy (409 S. 2^nd Street & 4401 Cresson Street):

Offering “101” courses in Salsa, Swing, Hip-Hop and more, this versatile dance studio is beginner friendly with an encouraging and accommodating staff. Group classes on Thursday nights boast the healthy alternative to the traditional bar scene. Ask about group lessons, parties, and reduced parking prices while rates last!

Take the Lead Ballroom & Latin Dance Studio (4701 Pine Street):

Co-owners Garincha Hilaire & Jennifer Janson were kind enough to host our Women Entrepreneurs’ Circle last September, when they taught even the most uncoordinated of the Empowerment Group staff how to move with the music and give Latin dance a try. Stop by the studio on July 24^th for a Salsa Beach Party or give their friendly staff a call for class schedules and private lessons.

Kelly & Lesley Argentine Tango & Social Dance (1315 Buttonwood Street & 4226 Spruce Street):

Kelly Ray & Lesley Mitchell have been immersed in the study of Argentine Tango for over a decade, and together teach the fundamentals to enthusiastic beginners in the streets and studio’s of Philadelphia. Drop-ins are welcome to join classes at the Buttonwood location on Tuesday evenings starting at 6:30 and 7:30pm, or can swing by the Spruce Street location for Kelly & Lesley’s Friday Night Milonga. Visit their website for more information about their FREE Tango & Live Music available on July 29^th!

If we’re missing something we want to know about it! Call, email, or knock on our door with event information or a special small business opening near you.

How To Breathe and Network at the Same Time

Networking events terrify me. Strangers asking me probing questions, the vitality of my business on the line. All right, so that more aptly describes a police interrogation than a mixer, but you get the idea. It’s scary in there.

If you’re like me and see a networking event as a room full of potential missed opportunities, take a look below. I’ve assembled a list of tips from the experts on how to relax at your next networking event and enjoy the company. And who knows, maybe you’ll make a few leads in the process.

1. Think of what you hope to achieve before you arrive at the event. Like most aspects of small business, realistic goal-setting is paramount. If you attend a networking event with the expectation that you’ll develop one promising business lead and meet two really nice people, you won’t feel so disheartened when you leave without that big contract.
   
2. Listen to other peoples’ goals for the evening, think about how you can help, and seek out common ground. This tip is plastered over just about every networking site on the Internet. Why? Because cooperative relationships between small business owners are the most long-lasting, productive, and supportive kind. Learn more about good listening at “The Ten Commandments of Networking”.
   
3. Bring a friend. Having a familiar face in the room can make the prospect of unfamiliar faces a little less daunting. As long as you promise to brave it on your own for a little while, don’t feel sheepish about bringing some back-up. According to John Wall at Media Bullseye, your networking can be 8x more effective with the buddy system.
   
4. It’s OK to own up to your newbie networking status. People rarely frown on honesty, and you may discover a kindred spirit in the process.
   
5. Don’t forget to say goodbye. Saying goodbye to your fellow networkers is not only polite, it reminds you of the evening’s successes and the fun you had while doing it.

For some advice on what to do after the event, check out this post from the EG archives.

Consider taking these tips for a test spin at Empowerment Group’s upcoming networking event. Tiana will set the stage for purposeful socializing with a presentation on the benefits and tactics of business bartering. Tuesday, June 28th, 6:30pm to 8:30pm @ Smokin’ Betty’s (11th and Sansom, Philadelphia, PA)

Bonjour, Publicity!

Some small businesses put flyers in people's doors. Others set up stands at events. Others just open up shop and hope for the best. In Philly's Fairmount neighborhood, small business owners promote their services by dressing up in 18th Century garb, offering French-themed specials, setting up stands in the street, and chopping watermelon with a 30-foot guillotine.

This weekend the Eastern State Penitentiary hosted its 15th annual Bastille Day Festival. Visitors flocked to the historic former prison and the neighborhood's surrounding shops and eateries for a weekend of French-themed festivities, like the French Fling Bar Crawl and the Tricycle Tour de France.

Although everyone came together to "storm the Bastille" at the Penitentiary entrance on Saturday afternoon, the local businesses did an excellent job accommodating the variety of visitors. Daytime activities included face-painting, croissant specials at Mugshots, and French-themed crafts for the kids. Local bars like Rembrandt's, The London Grill, The Bishop's Collar, Trio, Jack's Firehouse, The Belgian Cafe, Bridgid's and others offered special French-inspired menus and drink specials late into the evenings.

London Grill Co-owner Terry Birch-McNally played the important role of Marie Antoinette, screeching "Let them eat Tastykake!" from the top of the penitentiary as local reenactors threw pastries down at the crowd. While the dialogue contained other bits of local flavor, jokes about current newsmakers (from Michael Jackson to Sarah Palin), and historical references, she also had ample time to plug her restaurant. Sipping on a can of champagne (this year's sponsor, Coppola's Sophia Blanc de Blanc), Birch-McNally urged festival attendees to pick up their own cans at the London Grill.

Birch-McNally didn't even need to risk her life for the publicity; the festival's guillotine is only used to chop watermelon.

Even without the danger of execution, she proved that a bit of unconventional publicity can do wonders for a small business. Other small business owners should take note that even without the French wigs and fanfare, getting involved in local events and making news in positive, offbeat ways can build valuable buzz around your business. For some reason 18th century execution devices are more conducive to bringing thousands to your doorstep than flyers ever will be.

Businesses & Twitter: How To Start Tweeting

I've attended several workshops and seminars lately that focus on the use of social networks for social change. Through each workshop, it becomes more and more apparent that online social networks are an essential part of any marketing plan. But what I also notice at these workshops is that many business owners are still wary of their impact, use and validity.

While I could coin myself a social networking expert, I'm not going to; the technology is constantly evolving and changing and we, as users, need to adapt and learn the impact of new technologies as they come.

The newest (or is it most popular?) site on the social networking ring is Twitter. This powerful tool allows individuals and businesses to connect, share resources and learn from each other in 140 characters. But what can you do with 140 characters?

First, you need to know the lingo:

1. A "Tweet" is an update on Twitter that's less than 140 characters.
2. An "@ Reply" begins a conversation with another Tweeter. If I write, "@EGEntrepreneurs, Thanks for the follow!" from my account (@leahhowse), anyone who follows both @EGEntrepreneurs and @leahhowse will see the conversation.
3. A "DM" is a direct message with another Tweeter. These conversations are private from all other users. To "DM" a user, @EGEntrepreneurs in this case, begin the message like this: "DM @EGEntrepreneurs..."
4. A "RT" is Re-Tweeting another users post. RTs are valuable capital in the Twitterverse, as they prove to you that your content is useful to your followers and help you gain more followers, respect and notarity in the community. To be RTd, try to leave at least 10 characters at the end of your Tweet.
5. A "Hash Tag" (#) is a symbol the Twitterverse uses to track trending topics. Hash tags are a way to catalog past tweets into manageable data sets.

Now that you know the jargon, what do you Tweet about? I've heard a pretty good suggestion: change the prompt from "What are you doing?" to "What are you passionate about?" With this in mind, it helps keep your tweets on track with things that are important to you and you business. I've created a few topical categories to give examples of Tweets I follow.

Links: Many tweets are links to news articles, blog posts and websites. These tweets create valuable traffic for business blogs and websites, and also help generate interest in certain topics.
Advice: These tweets generally come from "experts" in a specific field and offer insights into any of a number of topics. Generally not linked, the information is coming straight from the Tweeter.
Sales/Promotions: These tweets are offering an incentive for either Re-Tweeting the content or knowing the promo code for checkout. Dell generated more than $1 million through coupons on Twitter last year.
Conversations: Sometimes, groups of individuals on Twitter will create a Hash Tag for a certain discussion. These live Tweets are based around phone calls or meetings and highlight important parts of the discussion. This function has the potential to open up your conferences and workshops to a larger audience.

Finally, a link to a great guide to getting started with Twitter by Chris Bartlett (@harveymilk): Twitter 101.

And don't forget to follow Empowerment Group on Twitter @EGEntrepreneurs!

Choosing a Business Structure

Choosing a legal structure can be daunting, especially with all the tax and legal terminology involved. It’s tempting to bury your head in the sand and avoid the whole issue. But as a small business owner, this is one of the silliest things you can do. Rest assured that if you don’t make a decision about your business’ legal structure, a default decision will be made for you, one that could have major repercussions down the line.

Think of your legal structure as a form of self-defense. The right structure sets up strong protections for yourself, your business, and your assets. It impacts how you’ll pay your taxes, the amount of personal liability you’ll face, and how much paperwork you’ll need to deal with. Business owners who don’t take the time to consider this issue often find themselves regretting their decision after tax season has left their pockets flatter than they expected, or after a lengthy legal dispute.

In order to choose the right structure for your business, think about the financial and personal protection you’ll need, how much risk of liability you’ll face in business, how you’d like to pay your taxes, and how much time you’re willing to spend in corporate upkeep. The answers to these questions will go a long way towards identifying a structure for you.

For those who still need help figuring out which business structure is which, the descriptions below should help.

Sole Proprietorship

A sole proprietorship is the most common business structure. It usually involves one person who owns and operates the business; they’re solely liable for all debts, responsibilities, and profits incurred. In fact, in the eyes of the law, the business and the business owner are a single entity. Everything that happens in the business, from profit-making to workplace accidents, is considered an act of the business owner themself. This puts you and your assets (your house, car, bank account) at risk of being seized to satisfy a business debt. On the upside, sole proprietorship is quick and easy to establish and maintain, and taxation is simple – you report your business earnings on your personal income tax return.

Partnership

If your business is owned and operated by two or more people, you may want to consider a partnership. Partnerships come in two forms: general and limited. In a general partnership, both parties share responsibility for operating the business, as well as for its profits and losses. In a limited partnership, the general partners own and operate the business while the limited partners are only responsible for supplying capital. They otherwise have no control over the company, but neither are they liable for debts incurred. Like a sole proprietorship, the profits from partnerships are passed through to each individual to report on their tax returns.

Corporation

A corporation is a legal entity with all the rights and responsibilities as a person. In fact, in the eyes of the law and the IRS, a corporation is a person, a person whose only obligation is to create profit. The benefits to incorporating are primarily legal and financial. Business owners who incorporate are provided personal protection against liability, can raise funds to fuel their business more easily, and don’t have to risk personal assets to see their business grow. Drawbacks include the amount of time and money needed to incorporate. Several types of legal paperwork must be filed depending on which state you live in. This often requires the council of an attorney, which is not cheap. Corporations take a lot in upkeep, requiring you to file quarterly minutes of shareholder meetings. Several clients who operate as sole proprietors yet choose to incorporate have expressed to me how silly it feels to take minutes on a meeting of one single shareholder. Additionally, owners of corporations pay double the income taxes: once as profits of the business and again as individual income on personal tax returns. In order to get around this, many small business owners form an S-Corporation, which allows the business profits to ‘pass through’ to the shareholders, requiring them to file only once for the profits they make in business.

Limited Liability Corporation

The Limited Liability Corporation is a relatively new business structure, but one that’s becoming very popular. It affords business owners with all the personal liability and financial protection as a corporation, but with less rigorous criteria for formation and upkeep. LLCs were created to provide business owners with liability protection but without the double-taxation faced by corporations. Sound too good to be true? The LLC has its drawbacks as well. Chief among these are the fact that there’s not a lot of legal precedent with this structure. It hasn’t been around for as long, so the exact rights and responsibilities of an LLC are still vague and contested.

Keep in mind that this is only a crash course in the characteristics of each legal structure. For more information, check out the links below. And before you make any binding decisions, be sure to seek the advice of a qualified legal expert. They’ll give you the guidance you need to finalize your choice.

http://www.irs.gov/businesses/small/article/0,,id=98359,00.html

http://www.quickmba.com/law/org/

http://smallbusiness.findlaw.com/business-structures/business-structures-overview.html

How-To Cope with Negative Feedback

A few weeks ago, I offered some tips on soliciting customer testimonials. That post was based on the premise that your customers want to say nice things about you. But what happens when your customers think your pretzels are stale or your prices are too high? This week's "How-To Tuesday" addresses the other edge of the customer feedback sword--the bad review. How do you cope when faced with discontent?

Stay calm.

Bad reviews happen. People are going to disagree with the way you run your business. As long as you offer a quality product backed by quality service, your good reviews and positive feedback are bound to outweigh the bad. If negative feedback is the norm, it should give you a swift kick in the pants to turn things around.

Decide the appropriate time and place to respond.

According to Janet Thaeler at "Open Forum", there are different types of negative feedback: the genuine kind and the malicious kind. While Janet's piece focuses mainly on malicious competitors, customers are also capable of spewing some unwarranted venom. Constructive criticism deserves a constructive response. Nastiness, in my opinion, deserves to be ignored. Trust your potential customers to know the difference between someone with a legitimate complaint and someone who is just flying off the handle.

If you feel a response is warranted, consider the appropriate forum for doing so. Customers may feel betrayed if they think they're feedback is anonymous (e.g.--a comment card) and are then asked to justify their opinions publicly. While many experts recommend responding to bad reviews online, some small business owners question the utility of the tactic. Determine whether your response will clarify or frustrate before diving into the fray.

When addressing critics, be polite and open-minded.

Much like the nasty customer, the boorish businessperson allows his or her attitude to overshadow the disagreement. If you don't take the higher ground, your customers will only remember that pig-headed owner and completely forget the content of the dispute. If most of your attacks occur online, check out this post for a list of sites that permit owner responses.

Even if you don't respond to the customer directly, respond to the criticism.

Bad reviews, particularly reviews that harp on the same thing, give you an opportunity to recognize the gaps in your operation. More importantly, bad reviews give you the opportunity to fix the gaps in your operation. Not only will you better serve future customers, but you may regain previously dissatisfied ones.

But remember, you can't please everyone.


For more information on the reputation management more generally, check out these comprehensive articles:
"Why Reputation Management Matters for Small Businesses"
"Basics of Online Reputation Management"