Has anyone ever started a small business?
5/6/05, 01:31 PM
#1
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Thread Starter
Ok, I came up with a plan recently. I really want to get a 2005 or 2006 Mustang by summer of '06. Since 2001, I have been laid off twice and my credit is really, really bad because of it right now. Also, I'm really tired of my job and have always wanted to have my own small business. Here's what I was thinking:
I was thinking of starting up my own small business just doing easy stuff like lawn mowing/landscaping and maybe snowplowing in the winter. It's easy, not a whole lot of startup, and something I know a little about. I would enjoy doing something like that much more than working in this insurance call center. If I were to start my own business and start building credit under a business name, I could then use my business credit to turn around and buy a new Mustang and just keep fixing the Explorer we already have to use for the business. Now, here are my questions for any of you who have or had your own business:
1.) I know if I structure myself as a sole proprietor, I'll have to use my own personal credit info for the business, so I was thinking of trying to set myself up as a partnership or LLC or something along those lines so I have my own tax id number to build credit on. Do any of you know how hard and how much it would be to do something like that. I know I could search all over the net to find info, but I'd rather see if anyone here has some first-hand knowledge or experience that they could share with me. I was just thinking getting a small credit card for the business and buy things here and there for the business and pay them off right away to show responsibility. Any thoughts?
2.) If I successfully build up my credit to the point where I'd be able to get approved for a car loan under the business name, would the finance company require some kind of proof of how much profit the business would make just like they would want pay stubs for a loan to an individual? If so, what kinds of things would they need? I'm affraid I won't make enough on the business itself to show I can afford the car within the first year or so, but between the business and me and my girlfriend's income added to that, I know we could. And ideally, I would keep growing the business to the point where it wouldn't be a part-time/spare-time thing and be able to leave my current job. I just don't know how the finance companies consider giving loans to businesses other than credit rating.
3.) If I do end up having to become a partnership or LLC-type buisness to get a tax-id number to have business credit, is a long or expensive process? I know there are forms I'd have to file, but is it difficult to get them to do it?
I'm sorry if I'm asking something here that I should be searching the web for. But like I said before, I would rather hear some advice from any of you who have been there and done that if you know what I mean. Any help anyone could contribute would be great and extremely appreciated. I just don't think I can get my credit repaired well enough to get a new Mustang before the good weather is gone next year.
I was thinking of starting up my own small business just doing easy stuff like lawn mowing/landscaping and maybe snowplowing in the winter. It's easy, not a whole lot of startup, and something I know a little about. I would enjoy doing something like that much more than working in this insurance call center. If I were to start my own business and start building credit under a business name, I could then use my business credit to turn around and buy a new Mustang and just keep fixing the Explorer we already have to use for the business. Now, here are my questions for any of you who have or had your own business:
1.) I know if I structure myself as a sole proprietor, I'll have to use my own personal credit info for the business, so I was thinking of trying to set myself up as a partnership or LLC or something along those lines so I have my own tax id number to build credit on. Do any of you know how hard and how much it would be to do something like that. I know I could search all over the net to find info, but I'd rather see if anyone here has some first-hand knowledge or experience that they could share with me. I was just thinking getting a small credit card for the business and buy things here and there for the business and pay them off right away to show responsibility. Any thoughts?
2.) If I successfully build up my credit to the point where I'd be able to get approved for a car loan under the business name, would the finance company require some kind of proof of how much profit the business would make just like they would want pay stubs for a loan to an individual? If so, what kinds of things would they need? I'm affraid I won't make enough on the business itself to show I can afford the car within the first year or so, but between the business and me and my girlfriend's income added to that, I know we could. And ideally, I would keep growing the business to the point where it wouldn't be a part-time/spare-time thing and be able to leave my current job. I just don't know how the finance companies consider giving loans to businesses other than credit rating.
3.) If I do end up having to become a partnership or LLC-type buisness to get a tax-id number to have business credit, is a long or expensive process? I know there are forms I'd have to file, but is it difficult to get them to do it?
I'm sorry if I'm asking something here that I should be searching the web for. But like I said before, I would rather hear some advice from any of you who have been there and done that if you know what I mean. Any help anyone could contribute would be great and extremely appreciated. I just don't think I can get my credit repaired well enough to get a new Mustang before the good weather is gone next year.
5/6/05, 02:31 PM
#2
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Well since you say your credit is not so good, this might not be an option for you, but you might want to look into buying an existing business. Its alot easier than starting your own business, and banks are more willing to loan you money for them. Just a thought.
5/6/05, 05:12 PM
#5
If I were you I would start the business and just save enough money up to buy an 06 mustang out right instead of trying to build enough cedit to finance one... but thats just my .02 cents
A few years ago one of my fiends started a lawn mowing business and in one year he made enough money to buy a new truck, two new lawn mowers, a trailer to carry them on and still had something like $12k left over.
A few years ago one of my fiends started a lawn mowing business and in one year he made enough money to buy a new truck, two new lawn mowers, a trailer to carry them on and still had something like $12k left over.
5/6/05, 05:31 PM
#6
AKA 1 BULLITT------------ Legacy TMS Member
The success of a small business is its overhead. If you keep it to a minimun you'll do well.
The type of business you are interested in is a good recipe for it to triumph if you commit, sacrifice, work hard, satisfy your customers, and avoid hiring any help. That's right. More work with more overhead does not necessary gets you more money in your pocket.
Consult an accountant for a professional opinion on what to expect on taxes, licences, fees, and other usually hidden expenses.
Best of luck!
The type of business you are interested in is a good recipe for it to triumph if you commit, sacrifice, work hard, satisfy your customers, and avoid hiring any help. That's right. More work with more overhead does not necessary gets you more money in your pocket.
Consult an accountant for a professional opinion on what to expect on taxes, licences, fees, and other usually hidden expenses.
Best of luck!
5/7/05, 12:12 AM
#7
Cobra Member
Thread Starter
Originally posted by mobster+May 6, 2005, 6:15 PM--><div class='quotetop'>QUOTE(mobster @ May 6, 2005, 6:15 PM)</div><div class='quotemain'>If I were you I would start the business and just save enough money up to buy an 06 mustang out right instead of trying to build enough cedit to finance one... but thats just my .02 cents[/b]
As much as I'd love to do that, I don't think it's possible for me to do in a year's time. I'm in Ohio so we won't have grass-cutting weather for the whole year and as far as the plowing, I know plows aren't cheap so that'll set me back some.
<!--QuoteBegin-mobster@May 6, 2005, 6:15 PM
A few years ago one of my fiends started a lawn mowing business and in one year he made enough money to buy a new truck, two new lawn mowers, a trailer to carry them on and still had something like $12k left over.
[/quote]
Was your friend just mowing or was he doing the whole landscaping thing with putting down mulch, making the property look nice, etc? I ask only because that sounds like a TON of money to make in one year for one person. That's awesome that he was able to do that and I'm assuming he lives somewhere that he can do it year round?
5/7/05, 12:15 AM
#8
Cobra Member
Thread Starter
Originally posted by 1 BULLITT@May 6, 2005, 6:34 PM
The success of a small business is its overhead. If you keep it to a minimun you'll do well.
The type of business you are interested in is a good recipe for it to triumph if you commit, sacrifice, work hard, satisfy your customers, and avoid hiring any help. That's right. More work with more overhead does not necessary gets you more money in your pocket.
Consult an accountant for a professional opinion on what to expect on taxes, licences, fees, and other usually hidden expenses.
Best of luck!
The success of a small business is its overhead. If you keep it to a minimun you'll do well.
The type of business you are interested in is a good recipe for it to triumph if you commit, sacrifice, work hard, satisfy your customers, and avoid hiring any help. That's right. More work with more overhead does not necessary gets you more money in your pocket.
Consult an accountant for a professional opinion on what to expect on taxes, licences, fees, and other usually hidden expenses.
Best of luck!
5/7/05, 08:41 AM
#9
After all these years,
My C/T still sucks!
My C/T still sucks!
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I own my own business, but I am lucky that I have zero over head-All I need is a computer. I pay out the hiney for taxes every year....And pull in less than 20 grand-because I do not work so hard on it, I like free time.
a LLC would be the way to go if you did decide to get a business- it protects you in case the company goes under.
a LLC would be the way to go if you did decide to get a business- it protects you in case the company goes under.
5/17/05, 12:32 PM
#13
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Being in the dealership everyday I get to contend with this a little. I would be very suprised if you are able to get a loan in the business name without a personal guarantor. Very few small businesses get loans without a corporate officer signing as a guarantee. To do this, you will have to be a qualified borrower.
5/17/05, 08:52 PM
#14
Cobra Member
Thread Starter
Hmmm...That could throw a wrench in the works for me. Thanks for that bit of info Karpo. That's exactly the kind of stuff I was trying to find out.
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