Clearly define roles in family businesses
Dear Karen: My family would like to start a business, but I’m worried we won’t get along. Can you advise?
Answer: Unless you’re fighting over an inheritance, there’s nothing worse for domestic harmony than opening a family business. Stephen Moore, chief executive of family-owned Helen’s Foods in Irvine, offered these tips:
Create defined work roles: “My mother and wife work together to create products. When questions or decisions need to be made concerning anything outside their roles, I try to not concern them,” Moore said.
Someone’s got to be in charge: “Make sure the CEO gets the final say and takes responsibility for decisions. Otherwise you’ll have staff confused about who they report to.”
Be fair, listen and keep work life at work: “It’s tempting to put more weight on family input than expert advice, but I always try to listen to all opinions and then weigh the pros and cons on each view equally,” Moore said.
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Learn the industry before getting in
Dear Karen: I have an idea for a T-shirt company but no experience in the apparel business. How do I go about learning?
Answer: The best way is to work in the industry you’re targeting. Take a job in a T-shirt shop or at an apparel manufacturing or distribution firm. Pay attention, ask questions and you’ll get invaluable on-the-job training.
Next, do your research. Find out who your competitors, suppliers and customers will be. Why will your customers buy from your firm instead of another? If you can’t offer tangible benefits over your competitors, don’t bother starting a company, said Frank Stokes, a small-business consultant at Los Angeles-based Stokes Pacifique Associates.
Finally, plan your business as specifically as possible. Think about marketing, high and low sales seasons and where your customers will find your products: In stores, online or in catalogs?
“It’s crucial to calculate how much product you must sell in order to make a profit,” Stokes said. You’ll need enough start-up capital to get you through to that break-even point, at the very least.
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Licenses for home businesses
Dear Karen: I’d like to start a home-based business. Do I need to get a business license?
Answer: Depending on what city your home-based business is in, you may need both a municipal home-based business license and a county fictitious business-name statement. Not all cities require business licenses, so check with your city’s business development office.
If you’re located in an unincorporated part of Los Angeles County, contact the Los Angeles County Business License office at (213) 974-2011; for the city of Los Angeles, call (213) 626-9271.
You can get information on registering your fictitious business name (also called a DBA, or a “doing business as” statement), obtaining permits and licenses, residential zoning requirements and many other small-business issues at the Los Angeles County Office of Small Business: www.laosb.org.
An officer at the bank where you open a merchant account also should be able to give you pertinent information about licensing in your city and about getting a seller’s permit from the California State Board of Equalization so you can collect sales tax if you plan to sell retail products.
An online firm, Business licenses.com, can also assist you with licensing and permits. Its fees start at $19.99 and go as high as $175, depending on how much of the work you want to do yourself, said the site’s founder and president, David Polatseck.
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Got a question about running or starting a small enterprise? E-mail it to karen.e.klein@ latimes.com or mail it to In Box, Los Angeles Times, 202 W. 1st St., Los Angeles, CA 90012.
