Secrets to start a successful business

The Pakistani vision is, and always will be, to come up with an plan, start a business and become wealthy from your own struggle. Based upon this enthusiasm, thousands of businesses fail each year, due mainly to not being familiar with the basics involved in running a business.

This tale will make clear to you, and give you many suggestions you can use to better guarantee your chances for success. Remember the warning that any and every business venture contains certain inherent risks, and any number of alternatives. We do not espouse that any one way is the right way or that our suggestions are the only way. On the contrary, we advise that before investing any money in a business venture, you seek counseling and help from a experienced accountant or attorney.

Just about the first thing you should consider before deciding to establish or acquire a business is the legal form you will be operating under. There are basically four choices (a)sole proprietorship, (b)partnership, (3)limited partnership, and (4)corporation.

All has a number of advantages and disadvantages. We'll try to itemize some of them for you. As much as anything else, for various people starting a business is a form of ego-gratification, and they form a corporation for some sort of status gain, just to say, "I own a corporation."

With just a bit of observation, you will find that one of the major causes of business failures is due to the founder wasting start-up capital on frills, such as an impressive Store Front, expensive furnishings, and corporate legal costs.

The basic deed you must develop it you're going to be successful in business, is a firm hold on your expenditures. As a matter of fact, a good rule of thumb is that anything that does not make money for you or protects your investment should not be purchased. Positively, this applies to the expense of setting up your own corporation.

Except you have a partnership and start your business as such, the only real advantage to forming a corporation would appear to be that a corporate structure will semi-protect the property you personally own. As an example, you own a home and car. You form a corporation to shield these possessions from business losses. Yet, if you can be found guilty of misusing corporate funds, your business creditors can pierce the corporate shield and come after your possessions.

Principally, if you invest everything you have in your business, as most newcomers do, you don't usually need a corporation because you have nothing to protect. Your household possessions, personal belongings, generally your car, and even a portion of the equity in your home is protected by the homestead provision of the Federal Bankruptcy Act, and cannot be taken away from you.

As a sole proprietor or partner of a business you'll be paying taxes on your overall earnings, much the same as if you were holding down a salaried or hourly paid job.  Whether you do or don't take out money as a salary will have no bearing on the earnings of your business and tax return.