Software provides safeguards
Dear Karen: I run a small business and am on the road selling during the week. I’d like to do more business over the Internet but I’m worried about security.
Answer: Software is available that will allow you to conduct business through a secure website. You can write reports, take orders, send invoices, write and read e-mail and keep a record of who accesses the site.
Look for a Web database tool with a security framework that allows you to specify a log-on screen. This requires employees to enter their names and passwords to gain access. It also encrypts the data you transmit.
“Based on the log-on, the database should allow you to define what the person can see online and what they can change,” said Richard Rabins, co-chairman of Alpha Software of Burlington, Mass. “For yourself, the database would grant full access. For others, you might want to grant access only to their accounts, and even then, perhaps they could read but not change data.”
“Once your data is available online, the sky’s the limit. Virtually everything you do in the office can be done on the road, even if you’re accessing it from a mobile phone,” Rabins said.
Winter slowdown can be productive
Dear Karen: I run a successful swimming pool restoration business but we have major revenue slowdowns during the winter. What to do?
Answer: Create special promotions that you can advertise on your website to encourage restoration projects year-round. Also, consider selling pool products and accessories online as a second income stream.
Build Web traffic by adding “how-to” content, such as caring for a pool during the winter. Answer visitors’ questions about pool maintenance and restoration. The additional traffic will pay off if you place ads on your site through a partner program such as Google’s AdSense.
“When a consumer visits your site and clicks on an ad that has been automatically selected to match your site, you earn money,” said Emily White, Google’s director of online sales and operations. The additional revenue will vary, she said, “but may be a little extra something during the leaner months.”
Defined-benefit plans explained
Dear Karen: What is a defined-benefit plan, and can I offer one at my small technology firm?
Answer: Defined-benefit retirement plans guarantee a monthly payout based on salary and years of service. In defined-contribution plans such as 401(k)s or IRAs, individuals make contributions, often matched by employers, and the money available at retirement depends on changes in financial markets.
Although defined-benefit plans are more commonly offered by large corporations, they are approved by the Internal Revenue Service for smaller companies as well. The U.S. Department of Labor provides definitions at www.dol.gov/dol/topic /retirement/typesofplans.htm.
Karen Shapiro, chief executive of San Mateo-based Dedicated DB, said defined-benefit plans can be particularly attractive for high-earning sole practitioners and small-business owners age 45 to 70.
“They allow the maximum possible contribution and tax deductions,” she said. “On the con side, you should be reasonably confident that you will be able to fund the plan with a specific contribution for at least three years.”
Defined-benefit plans allow qualified business owners to contribute $150,000 or more annually to their pension plans. This compares to $25,000 for a Simple IRA, $45,000 for a SEP/profit-sharing plan and $50,000 for a 401(k) plan, Shapiro said.
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