Who runs their own business?

[Edbear]

The thread on the Gummints review of our tax system has brought out some interesting perspectives on how businesses and business persons operate.

No-one has missed the total collapse of many of the world's financial institutions and the problems of large companies due to mismanagement and greedy recklessness, so I have no argument that there are "big guys" who are irresponsible in their roles.

However many businesses are run very well and although not pushing anyone's barrow, I use as an example, TelstraClear which had a nightmare year last year and laid off many staff and had to really micro-manage their finances in a very competitive market under some significant disadvantages. No, despite their tie-up with Telstra Australia, they had to survive as an independent company and this year they are doing much better.

I know the CEO personally and it was very painful for him to be forced to lay off people. He genuinely cares. I was one of the casualties back in May and was very upset to lose a job I enjoyed and my bosses weren't happy either. Our business manager fought tooth and nail to retain his team, but in the end the number crunchers won.

I'd be interested in people's expriences and attitudes to running their own business as I think there are also misconceptions about what types of people run successful businesses and how they see their roles and their staff.

[Headbanger]

Shes a hard road, I ran my own company for four years of blood, sweat and tears but had to close her.

Aside from that, I have been involved in another (family) company for many years (though no longer, Fuckin Bastards) in a management role, and the biggest struggle was always the 50 grand a month wages bill, Always amusing to hear the bitching going on from the work force who had no comprehension of what was going on behind the scenes to ensure they were being looked after first and foremost.

And we have launched my wifes company in the last few months, Hasn't found traction yet.

A lot of the ignorant anti-business bullshit I read around this place makes me chuckle, No fucking idea at all.Just mouth.

[yungatart]

Mstrs and I run a small business from home...
No staff, just us. That way he gets to sleep with the receptionist and I get to sleep with the boss and nobody else gets upset about it.
(Well, there has to be some perks, right?)
It's not easy, we aren't rich, but we make a living and it suits us.

[rainman]

I am currently a one-man consulting company (my nod to "labour flexibility" in the current market) but have also run a successful small business with staff, as well as worked in mostly middle management roles in large and small businesses.

[scott411]

i run a company with 10 employees and it can be hard, he had to lay someone off last year and it is the hardest thing i have ever had to do so far

[Winston001]

Its quite normal for business owners to earn less than their employees in tough times. Why do they do it? In a small business the human relationships are personal and laying a good employee off hurts. At the same time the owner keeps optimistically hoping things will turn around and improve. Often they do.

[Big Dave]

I'm self employed, freelance, my own man, it's great, but the the boss is an idiot.

[JimO]

im a self employed tradesman, no staff only me

[Edbear]

I ran my own business back in the '90's as a travelling salesman. Started off as a "Bon Brush Man" calling on dairy farmers with dairy shed brushware. By the end I was selling all sorts of stuff but I did it wrong, worked too hard with too little capital, grew too fast and had a couple of setbacks which meant I wound up behind the 8-ball. Short story, I got sick, lost everything and ended up in a wheelchair. Since then we've been reluctant to pwn another busines, but circumstances such as being laid off in a recession and an offer to work with my daughter and son-in-law in their businesses has resulted in me once again owning and running my own business.

This time I'm trying to be smarter and consulting "people who know about such things". My daughter and son-in-law's business has grown and is becoming very successful to the point he now employs staff including an apprentice I have seen the sacrifices they have made, the sleeplessness the long hours, the countless thousands they have invested out of their own pockets and the sheer determination and effort they have put in to it. I take my hat off to them!

Personally I've worked my butt off for nothing for six months and my wife and I are living on very little. We've spent pretty much everything we had, hence my ad for the C50T along with putting all our toys up for sale.

Good news is we really don't have to sell off everything now and we're about to place our first order from overseas which will finance our second and we're now getting things in place to expand this year. Starting with no capital is hard, but it also means one is very careful about what one spends scarce resources on meaning very little money is wasted.

Any other experiences?

[Edbear]

Its quite normal for business owners to earn less than their employees in tough times. Why do they do it? In a small business the human relationships are personal and laying a good employee off hurts. At the same time the owner keeps optimistically hoping things will turn around and improve. Often they do.

Often the case, too. My son-in-law wishes he earned as much as the registered plumber on his payroll! :no:


I'm self employed, freelance, my own man, it's great, but the the boss is an idiot.

They usuallly are... :msn-wink:

[Headbanger]

I am currently a one-man consulting company .

Can I ask in what field?

I've been mulling over the idea of launching myself as a consultant, Though a bit of research indicates a few others locally have gone before me and failed.

[slofox]

I've had two businesses.

The first one employed several people. They got paid first. I got paid last. None of them would have worked for the hourly rate I made for myself...not even for twice what I paid myself. Why? Because it was all that was left, that's why. We eventually wound that business up after roading changes killed our passing traffic and made us hard to get to. The City Council were very happy...they didn't like having us where we were, despite us being there before the city took in the area.

My current business in basically just me but in the last year I have employed a one day a week part timer. I aim at the quality end of a market that is over supplied by those who are prepared to cut margins to the bone to get market share and who have the privilege of subsidising their selling of my product with the other things they also sell. It seems to me that the interest in quality product in general is on the wane in EnZed - especially with the current financial climate. But I also think we suffer from "Warehouse Syndrome" here - same as USofA's "Walmart Syndrome". Basically it goes "if it's cheap we buy it and fuck quality".

Or perhaps I am just a shit business man...

[rainman]

Can I ask in what field?

I've been mulling over the idea of launching myself as a consultant, Though a bit of research indicates a few others locally have gone before me and failed.

Sure, IT. (What else?) Basically I have a GST registered co for contract gigs. If the market is good I get to keep busy, if not... I might eventually pick up something more permanent. I do like contracting but to be honest one-man IT contracting in NZ is usually just a succession of short-term employment (doing whatever is required or available) rather than developing a solid single specialist product. Portfolio woking, basically. No hope of a job-for-life and a comfy pension, these days its a life of relative uncertainty. But such is labour flexibility.

This time around (done this before) I've had to do a real mix of stuff to keep afloat. It's been a tough market lately, getting a bit better though.

[BoristheBiter]

My father started our business up in 91, in started in 97 and we grew very well untill a few years ago when we just had too few jobs.
had to lay off one worker, then everyone thourght we were broke and left. ended up all right as without the overheads we fine.
best thing we did was sack the accountant and payed a bit more and got one that does look after us.
Have often thourght about packing it all in but i don't think i could work for anyone now.

[LilSel]

My parents are self employed, the biz has been going for over 30 years. I was made redundant from my job as a key account manager in april last year. Just so happened that another company who we contracted to, made their staff redundant at the same time. They then approached us & asked if we would take over the work for greater auckland.
As I was still looking for a new job (had 4 weeks to do so), parents asked if I wanted to start/manage & run my own biz (I've worked in the industry for years). So decided yep, & we hired the redundant guys, bought them vans etc etc... has been 9 months of intensely hard work thus far!! I do everything for my side of things & havent had a break since starting up.
I don't get paid extra for working stats, weekends or for any of the many hours of 'overtime' I put in... if my guys work overtime or on the weekend, they get paid overtime etc.
I'm 25 & the 'boss' to 6 full time guys (that is just my side of the fam biz), if I don't get my monthy invoice out, we dont get paid & the result would be.... disasterous!! I work very long hours & put so much into this. If I screw up, its not just me that will be f***ed...

So all in all, this is my experience ^^ & my attitude is, ya gotta do what ya gotta do to be successful, sacrificing time/money/social life is part & parcel.
My role is the 'boss' lol & my staff are gems :) I treat them as I'd like to be treated myself, with respect, I used to hate being spoken down to at previous jobs & that is something I just couldn't do. At first I was a little concerned about possibly being walked over because of my age but my guys are great!! I may be their 'boss' but I dont put myself above them, someone has to be in charge so to speak, we're a team, we work together & work together well!! :) Without them, I wouldn't have the biz.

Right... back to work LOL!!

[FJRider]

Can I ask in what field?

I've been mulling over the idea of launching myself as a consultant, Though a bit of research indicates a few others locally have gone before me and failed.

I'm a consultant .... pay me (lots of money) and I will answer your questions ... CORRECT/ON TOPIC answers cost more ...

[Motu]

I had my own business for 11 years,and although I'm happy I did it,I'm sure glad I'm not in it now.Someone gave me some advice about a small business - you need to get out at your peak,preferably before.He didn't, and nor did I.My best year financially was my worse year personally,and it was all downhill from there.Several friends and family ended up in hospital,and ultimately my mother had terminal cancer,I was unable to support everyone and my business at the same time...so I let my business suffer from my lack of time to the small things....and small things are important.By the time I was able to turn it around it was too late...or at least the effort required was sure to kill me.

4weeks holiday a year and no responsibility is heaven....

[BoristheBiter]

So all in all, this is my experience ^^ & my attitude is, ya gotta do what ya gotta do to be successful, sacrificing time/money/social life is part & parcel.
My role is the 'boss' lol & my staff are gems :) I treat them as I'd like to be treated myself, with respect, I used to hate being spoken down to at previous jobs & that is something I just couldn't do. At first I was a little concerned about possibly being walked over because of my age but my guys are great!! I may be their 'boss' but I dont put myself above them, someone has to be in charge so to speak, we're a team, we work together & work together well!! :) Without them, I wouldn't have the biz.

Right... back to work LOL!!

wish i had staff like yours. we looked after our staff well, good pay, conditions, phones, training etc and got taken for a ride so now i just treat them like emmployees.
they don't get to take any vans home, any time off is docket no phones short breaks and we get the same work out of them. i would like to treat them better but they have taken the piss for to long.
i now pay myself a shit load more than them (used to be the other way round) so when they complain i say "when you pay my wages then you can tell me what to do so get back to work".

[Edbear]

wish i had staff like yours. we looked after our staff well, good pay, conditions, phones, training etc and got taken for a ride so now i just treat them like emmployees.
they don't get to take any vans home, any time off is docket no phones short breaks and we get the same work out of them. i would like to treat them better but they have taken the piss for to long.
i now pay myself a shit load more than them (used to be the other way round) so when they complain i say "when you pay my wages then you can tell me what to do so get back to work".

It has to work both ways. I have to say I'm impressed with my son-in-law's employees, they do work hard and as result get more than they are entitled to. He believes in rewarding effort and they are as keen to build the business as he is as they realise their income depends upon the business succeeding.

[BiK3RChiK]

I had my own business for 11 years,and although I'm happy I did it,I'm sure glad I'm not in it now.Someone gave me some advice about a small business - you need to get out at your peak,preferably before.He didn't, and nor did I.My best year financially was my worse year personally,and it was all downhill from there.Several friends and family ended up in hospital,and ultimately my mother had terminal cancer,I was unable to support everyone and my business at the same time...so I let my business suffer from my lack of time to the small things....and small things are important.By the time I was able to turn it around it was too late...or at least the effort required was sure to kill me.

4weeks holiday a year and no responsibility is heaven....

I agree with this.... We've been in our own business for about 21 years and it has proved to be far too long! We really should have got out about 4 years ago, but thems the breaks! Back to the slog tomorrow...

[Leviticus]

I'm self employed, freelance, my own man, it's great, but the the boss is an idiot.

I'm the same, self employed, and my boss is a idiot too. Our Works Christmas party was a bit quiet though.

[cc rider]

My ex & I owned two. One a motorcycle customizing business. Harleys. Did fabrications etc & sold production parts to shops including in Germany. Naturally you have to deliver in-person, it's only polite. No real money in it especially when you find illegal reproductions of limited edition items in the local harley shop. That just pisses ya off. :mad:

The other one was a silver & goldsmithing business. We used to design & fabricate jewellery & small silverware. Again bugger all money in it for the effort. So we developed the silversmithing side, which centered around church & heritage restoration work. Them there churches have a lot of metal ware.
That was really interesting work.
I got to climb about the top of the 3 spires of St Paul's Cathedral In Melb (On top of the crosses). Great views. Had to wear my dri-rider in winter. :cold:Worked on a number of historic building in Melb & Ballarat. I only closed that one last year. It was always spasmodic income.
Paid well, but hard to meet bill payments & keep a workshop mantained.
Always handy to know how to polish stainless steel & alloys to a high grade finish.

So now I work in a motorcycle shop.
May even try owner business again one day. You never know, aye.

cc

[LilSel]

wish i had staff like yours. we looked after our staff well, good pay, conditions, phones, training etc and got taken for a ride so now i just treat them like emmployees.


Ahh I see... some people take things for granted eh *shakes head*, we took the guys & their wives out to dinner for xmas, they were all really appreciative & had a great time.
Made me feel really good eh :) The wives all gave me hugs n kisses & it was just awesome!!! The whole magnitude still really blows my mind!!! Didn't expect to be doing it so soon, absolutely love it & wouldn't change a thing. Working from home & means wearing/doing what I want & finally I can totally be myself!! Blue hair, tattoos, piercings n all :D That is the best thing!!
I dont envisage my guys taking the piss so to speak n sure hope that doesn't happen, they are good honest guys... 9 months in, there hasn't been any issues. I check over the phone bills, petrol card bills, statements from wholesalers etc etc... It wouldn't be difficult to tell if one of them was miss using things.

[Racey Rider]

Had 7 years in my own garden maintenance business. (No I didn't mow lawns) One Man band, fighting against the weather all the time. Employed casual staff from time to time. Made a few Business mistakes ..... Learn t' a few Lessons! Being the only income of the family I decided to pull the pin, take a break, get back on our feet financially.
Have a reasonable job now, but it's just not challenging enough for me.
Doing up a business plan now to start something in a totally different field.

A Question to small business owners:
Have you run your business both With, and Without an accountant? Are they really worth spending the money on?

Thanks.
Racey

[peasea]

I ran my own business for nine years. There are ups and downs but overall it was a hassle I'd not go through again. Having said that I've been freelancing for over a decade since (sold the business as a going concern in 98) but I couldn't go back to throwing spanners for a living.

Our accountant was too straight, we had to show him how to be legally devious. Anyone in any trade does work for cash here and there, it's the only way to get ahead, but there are ways you can save on taxes that are quite legal. Part of the problem with our tax system is that there are too many loopholes but 'too many' is entirely dependent on which side of the fence you're on. Yes, you need an accountant but try your best to find a good one. My ex wife was/is very good with figures and very good at understanding how monetary systems work so 99% of the work was done before the books went to the accountant, which made our bill from him pretty small every year.

I think part of the reason so many small businesses collapse is because the owner/operator might be very good in their chosen field but lousy at business practice. I still don't know anything about the money side of it unless it's cash in the hand, I just went nose down into what I knew and threw all the paper into the top drawer. To run something I'd suggest a course in business management, MYOB or something like that to get the basics.

We had a surprise visit from IRD one day, not pleasant, but we were squeaky clean. It pays to be that way or they'll chew you up and spit you out.

[Quasievil]

Yeah we own a small Business QMOTO, been going nearly 7 years is it easy........no...........market is now saturated with cheap trademe rubbish which seems to dominate the buyers choice, but we aint going there and have continued to increase the brand quality at the cost of volume sales but the gear now easily rivals the bigger players in the market. Would I do it again........NO.......the Motorcycle industry in this country is a very hard one to work in.

Tricks, a good accountant, tenacity, and hard work, as well as Marketing, go to the market dont wait for them to come to you, there a lots of cheap tools you can use to market the products or service you sell.
One thing I have learned in Marketing is the bigger the cost the worse the result, Motorcycle Mags for example are a waste of marketing dollars, spent thousands with them .............never again.

Hard yards............expect it, dont think its easy, you are working 24/7 if you own a business, mentally or physically youre at work all the time.

[Headbanger]

I think part of the reason so many small businesses collapse is because the owner/operator might be very good in their chosen field but lousy at business practice. I still don't know anything about the money side of it unless it's cash in the hand, I just went nose down into what I knew and threw all the paper into the top drawer.

That's me.

[Edbear]

Yeah we own a small Business QMOTO, been going nearly 7 years is it easy........no...........market is now saturated with cheap trademe rubbish which seems to dominate the buyers choice, but we aint going there and have continued to increase the brand quality at the cost of volume sales but the gear now easily rivals the bigger players in the market. Would I do it again........NO.......the Motorcycle industry in this country is a very hard one to work in.

Tricks, a good accountant, tenacity, and hard work, as well as Marketing, go to the market dont wait for them to come to you, there a lots of cheap tools you can use to market the products or service you sell.
One thing I have learned in Marketing is the bigger the cost the worse the result, Motorcycle Mags for example are a waste of marketing dollars, spent thousands with them .............never again.

Hard yards............expect it, dont think its easy, you are working 24/7 if you own a business, mentally or physically youre at work all the time.

Well said and good advice. If anyone wants a business, you basically have two options. Start/buy one you like but look at it as a hobby, as you're unlikely to make a lot of money. By this, I mean as an example, that I would love to own a bike shop selling bikes, realistically, I'd struggle as much as I love the idea.

Otherwise, look for a demand in the marketplace and see if you can fill that demand with better quality and/or cheaper prices for the same. Look for something that will sell. Don't sell rubbish! It will come back and bite you!

What we have done, and our bank manager and accountant agree it is a "Very good idea!", is found a product that is in effect, a better paper-clip. It is an everyday product that is essential in the industry and replaces another one that no-one wants to use, but has been the only one available until now. We are importing it directly from the manufacturer and it will sell line-ball on price with the alternative, so we expect it will take off!

The cost is similar to the paper-clip analogy, as people will simply grab another box or tube when they run out without consideration of the price. We will wholesale it to the industry merchants by the pallet.

We have had to do the hard yards in the background and it has taken some time, but 'due-diligence' is necessary as we have had virtually zero capital to invest and have to be very careful with our finances.

A good accountant is essential if you are not one yourself, and do listen to him/her! Think seriously about a Trust, too, to protect personal assets and give you tax breaks while you are small and needing every cent. I can refer you to very good "people who know about these things" if you like. But factor in administration costs. Like buying a bike, if you can't affor the helmet and boots, you can't afford the bike...

[BoristheBiter]

Ahh I see... some people take things for granted eh *shakes head*, we took the guys & their wives out to dinner for xmas, they were all really appreciative & had a great time.
Made me feel really good eh :) The wives all gave me hugs n kisses & it was just awesome!!! The whole magnitude still really blows my mind!!! Didn't expect to be doing it so soon, absolutely love it & wouldn't change a thing. Working from home & means wearing/doing what I want & finally I can totally be myself!! Blue hair, tattoos, piercings n all :D That is the best thing!!
I dont envisage my guys taking the piss so to speak n sure hope that doesn't happen, they are good honest guys... 9 months in, there hasn't been any issues. I check over the phone bills, petrol card bills, statements from wholesalers etc etc... It wouldn't be difficult to tell if one of them was miss using things.

It was all going good but when we hit a slow patch everyone just sat on there arse so it made it even harder and when we liad one guy off it got worse.
We put in gps trackers in the vans and found that they were going off all over the place and when we talked to them about nothing chaged so we took the vans off them.

I am now down to one other emmployee and because of before i just don't trust him so it makes it hard.
I think i will just close up and go work for somone else, 4 weeks paid leave a year sound quite good.

[Pixie]

I'm self employed, freelance, my own man, it's great, but the the boss is an idiot.

Me too. Except my employee is a lazy prick who is opinionated,expects too much pay and wants too many days off to go riding.

[Big Dave]

Is that an electric snake?

[crazyhorse]

My ex and I started up a contracting business. We had a ditch witch and a chipper. Made good money, but when you live in a small community, hard to have enough work to make it a thriving business. But gotta try things for sure....

[madmal64]

Best thread on KB at the moment.
Great to hear other peoples stories & advice. My accountant is my best sounding board luckily. He is a typical conservative bean counter but I know him well enough to trust is advice. I would also recommend a business coach such as Action Business coaches. If you are 100% honest & open to these guys they really can work for you. They may ask you some really tough & direct questions on how & why you are doing what you are doing, but they got me thinking about things in a different way & have made a great positive impact on what I/we do.
Its a lot tougher than wages or salary but worth the effort

[LilSel]

4 weeks paid leave a year sound quite good.

Lol, Doesn't it just!!! I haven't seen in my 25 years mum n dad have more than 2 weeks off, they go to Fiji once a year for a much deserved break.
Last time they was October just gone, I took care of the other side of the business, boy was I glad to see them home again!! Was an epic two weeks for me lol!
I am hoping to take a few weeks off in May-June this year to go see Cher in Las Vegas, have to show them how to do my side of things & hope when I get back there isn't a huge mess to clean up! Im the only one that knows how things work/track/invoice etc on my side, will be a fair few days of lessons I'd imagine to get them up to speed.
Would be nice to be able to call in sick when off colour n spend the day in bed getting better too huh! Had a wicked flu back in winter, just had to tough it out, snotty tissues n all lol.
We recently got navmans for the vans, they aren't tracking ones however. The place we bought the vans from was the place the guys used to work n they had aerials for tracking but we took them out. If jobs start taking longer or things dont seem right, will consider putting them back in.
Im hoping there isn't any incidents that lead me to be skeptical of them, time will tell eh. Has been a few speeding tickets/bus lane fines come thru in the mail in the last 9 months, but that isn't a biggie, they get them, they pay them, the vans are unmarked so no need to tell them off as such, their own fault lol :)

[steve_t]

... 4 weeks paid leave a year sound quite good.

4 weeks? Don't forget anniversary day, waitangi day, good friday, easter monday, anzac day, labour day, queen's birthday....
The employees aren't very happy this year though since waitangi and anzac days fall on the weekend... oh well, a small reprieve for business owners once or twice a decade

[Motu]

A good accountant is important,and there are pit falls.My first accountant was a recommendation,and he seemed to do the required work.But he thought his job as my accountant was to make me pay as little tax as possible.I was a bit concerned at how much I was earning on paper,but we seemed to be doing ok.The problem came when we applied for a mortgage....the bank was a bit concerned about how we were going to repay a loan earning $15,000 a year.So that was the end of him!

[BoristheBiter]

Lol, Doesn't it just!!! I haven't seen in my 25 years mum n dad have more than 2 weeks off, they go to Fiji once a year for a much deserved break.
Last time they was October just gone, I took care of the other side of the business, boy was I glad to see them home again!! Was an epic two weeks for me lol!
I am hoping to take a few weeks off in May-June this year to go see Cher in Las Vegas, have to show them how to do my side of things & hope when I get back there isn't a huge mess to clean up! Im the only one that knows how things work/track/invoice etc on my side, will be a fair few days of lessons I'd imagine to get them up to speed.
Would be nice to be able to call in sick when off colour n spend the day in bed getting better too huh! Had a wicked flu back in winter, just had to tough it out, snotty tissues n all lol.
We recently got navmans for the vans, they aren't tracking ones however. The place we bought the vans from was the place the guys used to work n they had aerials for tracking but we took them out. If jobs start taking longer or things dont seem right, will consider putting them back in.
Im hoping there isn't any incidents that lead me to be skeptical of them, time will tell eh. Has been a few speeding tickets/bus lane fines come thru in the mail in the last 9 months, but that isn't a biggie, they get them, they pay them, the vans are unmarked so no need to tell them off as such, their own fault lol :)

All of our vans are fully sign written so its had to hide.

I tried to show my dad how to do the banking on the computer and how to pay everyone when i went on holiday a few years back and when i got back everything had been done on bits of paper and all the staff had been paid cash, not even entered in the wages book. it took me a week to sort it out. he knows how to do his work better than most but he won't go near the computer. so now i have a few days off a year.

know anyone looking to buy a small company.

[BoristheBiter]

A good accountant is important,and there are pit falls.My first accountant was a recommendation,and he seemed to do the required work.But he thought his job as my accountant was to make me pay as little tax as possible.I was a bit concerned at how much I was earning on paper,but we seemed to be doing ok.The problem came when we applied for a mortgage....the bank was a bit concerned about how we were going to repay a loan earning $15,000 a year.So that was the end of him!

That s what happened to our first accountant, he was just doing it as a favor to my dad. when he said we had to pay 40k in back taxes i went and found a new one, and try also do business planning.

[Edbear]

That s what happened to our first accountant, he was just doing it as a favor to my dad. when he said we had to pay 40k in back taxes i went and found a new one, and try also do business planning.

Good point and crucial to success. You must have a plan and do a cash-flow forecast. All the banks have a free cash-flow form you can use and it is an eye-opener. You will be surprised at how much you spend on things you never give a thought! Yet it all comes off your bottom line and makes a difference.

If you're selling, immediately transfer the GST + 5% into a separate account and don't touch it! Each GST period you will have more than enough to cover your GST and if you are due a GST refund for the period, put that into the account too.

Let the account build up and do the same with PAYE if you pay wages, including any Kiwisaver contributions and Student Loans. DO NOT SPEND THIS MONEY!!!!

Keep and properly file ALL receipts. At some point you will be audited by IRD and if they get a whiff of fraud they will be very upset.... They are the last people you want to have upset with you...!

I keep closely in touch with the IRD and they appreciate honesty and will bend over backwards to assist you if you are trying to get it right. They never criticise for silly questions, but cross them and it'll be you doing the bending over...

If you like your acountant, as has been said, listen to him. I didn't once and it cost me dearly, I thought I knew better what my business needed, I was wrong...

In your second year of trading you will be required to pay Provisional Tax, that is tax in advance to offset any shocks at the end of the year. This is the really tough year for most businesses. That extra 5% you have been putting aside will help pay this.

[Swampdonkey]

16 years so far... not easy. Used to employ staff back in the ninetys .Had to let them go after a 5 month closure stopped all income.
Also dealing with Osh and Maritime authority made things impossible.
Also all other Government leechs MAF ,MOF, DoC ,northland health. FOOD HEALTH N SAFETY ..Seafic...FNDC, Nthland regional council
Dont get me started ....i wake up screaming sometimes...and i havent even gone to sleep....
wouldnt give it up for quids

[BoristheBiter]

In your second year of trading you will be required to pay Provisional Tax, that is tax in advance to offset any shocks at the end of the year. This is the really tough year for most businesses. That extra 5% you have been putting aside will help pay this.

the worst thing is if you make more money than you had planned you get charged" use of money" intrest, but if you have a refund it takes up to six months and you get nothing back.
we had to put off billing out one client for builing 3 new cranes as it was done in March and it was a last minute thing so had not been allowed for (that was a tight few months).
tipical goverment department, no thanks for making money.

[ynot slow]

Both mum and dad have had business',mum and dad had a 7day dairy back in early 70's,6am-9pm 7 days(before indians did the same)they split the day into mums or dads time off,then mum bought a coffee lounge 5 days a week,then into byo restaurant.Dad was starting in the travel industry in 76 with a friend,they ran it 24/7,as in those days a call at midnight for a person to get to Sydney for a funeral meant having to go to shop,phone the airlines and book then,well before faxes and internet.Also as dad was into racing he would often get the call to fly a local jockey from NZ-Aussie on Friday to get to Sydney the next day,made for fun when he had xmas piss ups and having to go to work half pissed,never happen today with check points.

[Naki Rat]

.... But I also think we suffer from "Warehouse Syndrome" here - same as USofA's "Walmart Syndrome". Basically it goes "if it's cheap we buy it and fuck quality".

......

And the very people who are happiest to buy that crap are the ones whose jobs are most at risk (if not already gone) due to the flood of cheap manufactured goods. I've seen it both here and in Canada and it's so infuriating to see the masses unable to see beyond a cheap price tag.

[Edbear]

And the very people who are happiest to buy that crap are the ones whose jobs are most at risk (if not already gone) due to the flood of cheap manufactured goods. I've seen it both here and in Canada and it's so infuriating to see the masses unable to see beyond a cheap price tag.

Sounds to me lke you're saying that buying cheap *imported* goods at the expense of local manufacturers who employ them is putting those local manufacturers out of business, who then have to lay off their employees...

[george formby]

I've had a restaurant which was successful according to the bean counters but nearly killed me due to stress & hours. I also ended up being a single husband. After a stint getting paid a good salary & having great holidays I am now the concerned owner of a coffee/ juice bar. Small business is tough but I still love the feeling of making customers happy & being responsible, win or lose. I have grown as a person from taking the plunge into business & learnt a huge amount. The money sucks though. Never mind, onward & upward.

[Edbear]

I've had a restaurant which was successful according to the bean counters but nearly killed me due to stress & hours. I also ended up being a single husband. After a stint getting paid a good salary & having great holidays I am now the concerned owner of a coffee/ juice bar. Small business is tough but I still love the feeling of making customers happy & being responsible, win or lose. I have grown as a person from taking the plunge into business & learnt a huge amount. The money sucks though. Never mind, onward & upward.

Where are you situated? In a mall? Take a look at where you are and your clientelle base and have a think about something that will give you a unique attraction.

[kwaka_crasher]

11 years self-employed. No staff. I never advertise or have to deal with Joe Public. All my work comes word of mouth. I don't even have business cards or a website.

I guess I'm lucky it's a niche industry where skills and trust are the asset, not attendance. I pity people in retail - I'd strangle the drips they have to deal with.

I'm never ever going salary or wage again.

[davereid]

I have been operating a business for 20 years. We started just as me, consulting in electronics. Then we started making electronic equipment in a small factory. Our product was a bit specialist, so we saw the need to diversify, and we started doing security alarms, SKY and satellite TV, just so we had a wide customer base. We had good years and bad years. Many times we paid the wages with our savings or the credit card.

Overall, it has been great.

But New Zealand does not lend itself well to enterprise.

Managing employees is very difficult, as they have a wide range of "rights" which are expensive for an employer to get wrong.

The tax system, and compliance rapidly becomes as important to the survival of the company as its core products and services.

For me, I have found the introduction of 2-monthly provisional tax to be the straw that broke the camels back as they say.

I'll be winding things down over the next year or so.

[Edbear]

11 years self-employed. No staff. I never advertise or have to deal with Joe Public. All my work comes word of mouth. I don't even have business cards or a website.

I guess I'm lucky it's a niche industry where skills and trust are the asset, not attendance. I pity people in retail - I'd strangle the drips they have to deal with.

I'm never ever going salary or wage again.

Goodonyer, and if you enjoy what you do you've got the best business going.

[Edbear]

I have been operating a business for 20 years. We started just as me, consulting in electronics. Then we started making electronic equipment in a small factory. Our product was a bit specialist, so we saw the need to diversify, and we started doing security alarms, SKY and satellite TV, just so we had a wide customer base. We had good years and bad years. Many times we paid the wages with our savings or the credit card.

Overall, it has been great.

But New Zealand does not lend itself well to enterprise.

Managing employees is very difficult, as they have a wide range of "rights" which are expensive for an employer to get wrong.

The tax system, and compliance rapidly becomes as important to the survival of the company as its core products and services.

For me, I have found the introduction of 2-monthly provisional tax to be the straw that broke the camels back as they say.

I'll be winding things down over the next year or so.

Good post and good points made. Wages are hard on a business as they are a significant part of fixed costs and the employee needs ot produce more than he costs otherwise he is a liability to the business.

Taxes and compliances need to be accounted for when setting prices or quoting for jobs and this makes it extra tricky in a competitive environment when others are cutting their prices to win jobs. When setting prices, you have to take into account all your costs which many don't do to their long term detriment simply to get the job at the time.

At times, my son-in-law has had to take his own "wage" and profit out of the equation to win a contract, but this is now no longer a problem due to the volume of work he has on the books and in most cases he is the preferred contractor regardless of price due to word of mouth and reputation. He still has to be competitive and certainly tries to give his clients the best deals he can, but it is no longer a situation where he has to be unreasonably cheap to get the job.

Often, people don't realise the costs of running a business and when they find out the cost of a product and compare it to the retail price, they think the business is ripping the public off , and while at times this is true, my accountant once said that my overall GP needed to be 33% or the business wasn't viable, so taking the GST exclusive cost and doubling it to make the GST inclusive sale price gave me about that margin.

However, as some products were extremely competitive, such as the bulk laundry deteregent I was selling I could only put 10% on that and was buying it by the tonne ex-factory, and torch batteries I would buy at the supermarket as I couldn't get them anywhere else for the same price and sold them with the torches at cost.

Some products, however, I could get a GP of 110%+ on while still being cheaper retail than my competitiors, so I made use of that advantage to prop up the lower profit items.

[george formby]

( In response to EDBEAR'S querie's )

I'm on a main street with good passing trade & a growing base of local customers. Visitor numbers are way down on last year, the whole community is suffering & their are whispers of rent de-faults even though it is peak season. I had hoped that I could develop the shop further if I had a good season, as you say, making a point of difference.
I look at a potential business from the perspective of what it costs to run, not how much it might make so I'm reasonably secure here, I can just plod along without to much stress. The important thing is to continue developing the shop, if I cannot do something this year I will do it next year. It's a lot safer to spend time rather than money at the moment.
Fortunately, good coffee will always be popular.

[Edbear]

( In response to EDBEAR'S querie's )

I'm on a main street with good passing trade & a growing base of local customers. Visitor numbers are way down on last year, the whole community is suffering & their are whispers of rent de-faults even though it is peak season. I had hoped that I could develop the shop further if I had a good season, as you say, making a point of difference.
I look at a potential business from the perspective of what it costs to run, not how much it might make so I'm reasonably secure here, I can just plod along without to much stress. The important thing is to continue developing the shop, if I cannot do something this year I will do it next year. It's a lot safer to spend time rather than money at the moment.
Fortunately, good coffee will always be popular.

Unfortuantely we didn't get up to Paihia this Summer, (yet...), but it is probably one, if not the favourite place of ours. We have stayed at the Abri for an anniversary there and probably had a coffee at your shop. Which one are you? 35 Degree Sth is a great restaurant, too.

I thought the shopping there was very good for a small town. There are, of course a zillion coffee lounges there so you are definitely in a competitive area, but as you say, good coffee will always sell. All you need is to be in the right part of the street, ie: convenient and sell great coffee and have the cafe and staff look attractive. By staff, I mean if they are genuinely open and friendly and smile, if they look like they enjoy their job, they will attract custom.

I don't think it would need much of a gimmick to give you an edge though, especially with the care you take over your costs.

[george formby]

I've been in hospitality for over 30 years, customer service, quality & consistency are absolutely paramount. I really enjoy making my customers happy, making little coffee addicts.

[Edbear]

I've been in hospitality for over 30 years, customer service, quality & consistency are absolutely paramount. I really enjoy making my customers happy, making little coffee addicts.

And that's what will keep them coming back! Next time we're up we'll pop in for one!

[george formby]

And that's what will keep them coming back! Next time we're up we'll pop in for one!

Next to the dairy on King's Road, lots of bike mags to peruse too.

[Big Dave]

'....I've been in Hospitality all my life - and if they don't like it they can get stuffed.' - Myall

[kwaka_crasher]

Goodonyer, and if you enjoy what you do you've got the best business going.

Nah... I still have to work!