{"id":29428,"date":"2017-12-22T14:44:26","date_gmt":"2017-12-22T18:44:26","guid":{"rendered":"http:\/\/www.andysowards.com\/blog\/?p=29428"},"modified":"2017-12-22T14:44:26","modified_gmt":"2017-12-22T18:44:26","slug":"financial-aspects-running-business","status":"publish","type":"post","link":"https:\/\/www.andysowards.com\/blog\/2017\/financial-aspects-running-business\/","title":{"rendered":"Financial Aspects of Running a Business"},"content":{"rendered":"

When you start a new business, it’s natural to wonder if you have any chance of competing against more established ones. Although a small business and a large business may be in the same industry, the significant difference between them will affect all aspects of their financial operations.\u00a0Although all businesses have similar financial aspects, they are also dissimilar. Some things will be the same, from\u00a0freelancing<\/a>\u00a0all the way up to corporations, but others will markedly different.<\/p>\n

Let\u2019s take a look at the differences between a freelance and a corporate business when it comes to money matters.<\/p>\n

Freelance Business<\/h3>\n

There are times when your business will have an abundance of work and times when there will be a scarcity, usually over the holiday season. Consequently, it\u2019s important to be prudent about not increasing your overheads when things are going well\u2014for instance, buying new B2B software on a subscription basis to streamline business processes. One solution to balance the drop in income is to get a small business loan. Companies like the\u00a0Lending Club<\/a>\u00a0can provide a small loan of $5,000 to help you manage staying on top of expenses.<\/p>\n

Corporate Finance<\/h3>\n

Let\u2019s take a look at how a corporation’s financial aspects are determined by legal structure, size, funding, and marketing.<\/p>\n

Legal Structure<\/em><\/h3>\n

\"freelance-business-legal-structure-options\"<\/a>
\nWhat’s the Best Legal Structure for Your Freelance Business?<\/em><\/p>\n

A small company might be a sole proprietorship or it might be a partnership. This means that a single owner or group of owners have total control over the company. On their personal income tax returns, they will pay taxes on their business profits. They are also legally responsible for all their business debts.\u00a0Medium to large companies, on the other hand, are considered corporate entities separate from their owners. Consequently, owners don\u2019t directly manage the business but are shareholders that appoint executive board members.<\/p>\n

Business Size<\/em><\/h3>\n

\"BLOG-set-right-rate-grow-freelance-business\"<\/a>
\n5 Ways to Set the Right Rate and Grow Your Freelance Business<\/em><\/p>\n

You probably believe, based on common sense and experience, that you have some understanding of the difference between the different business sizes.\u00a0You might, for example, think of a small business as anything from a freelance business that earns 6 figures a to a company that hires about 10 people and earns close to a million or slightly more.<\/p>\n

However, there is, in fact, a lot of confusion about business size. A Forbes article on this\u00a0question of business size<\/a>\u00a0points out how much confusion there is about this topic:\u00a0\u201cGet a load of the U.S. Small\u00a0Business\u00a0Administration (SBA). Their\u00a0standard definition of a small business\u00a0includes operations with up to $7 million in revenue or 500 employees, depending on the industry. And there are countless exceptions, with\u00a0revenue thresholds set as high as $35.5 million, and employee counts as high as 1,500! No kidding: Railroads with 1,500 employees are considered small! Food service contractors with $35.5 million in revenues are considered small!\u201d<\/p>\n

Funding<\/em><\/h3>\n

\"9-realistic-ways-to-fund-your-startup\"<\/a>
\n9 Realistic Ways To Fund Your Startup<\/em><\/p>\n

A new business will raise the funds it needs to start either through personal savings, loans from family and friends, or small business loans. Since medium and large businesses need far more money than can be available from these sources,\u00a0 they raise money from investors, from venture capital firms, and from selling shares of their stock to the general public, or by selling bonds.<\/p>\n

Marketing<\/em><\/h3>\n

\"How-to-Start-Freelance-Business-While-Working\"<\/a>
\n10 Steps to Start a Freelancing Business While Working Full-Time (and Why You Should)<\/em><\/p>\n

How do small and large businesses compete in the same industry? They do it by focusing on a different size of a market. A small business is niche-focused, selling only a specific type of product. In comparison, mid-sized and large businesses sell a wider range of products to a larger segment of consumers.<\/p>\n

Additionally, the larger a company grows, the more likely it is to branch out into completely different markets. For example, General Electric started out as a merger between Edison Electric Light Company and Thomson-Houston Electric Company. Today GE does far more than selling products in the electric industry; there is also GE Aviation, GE Capital, GE Digital, GE Energy Connections, GE Healthcare, GE Lighting, GE Power, GE Renewable Energy, and GE Transportation.<\/p>\n

In conclusion, although you may be a new business, perhaps a freelance business or a business with a small staff, you still have a good chance of doing very well in your market. Your small size makes it easier to innovate, move quickly, and get your products out to the marketplace.<\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

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