How To Star Your Own Limousine Rental Business

Limousines are one of the trendiest modes of transportation for many special events today. Quite commonly found in big cities, no special event is ever complete without the right limo to pick you up and drop you off in front of the venue. Having one on your special event will definitely guarantee bewildered gasps from the other guests and family members that will definitely make the event a more memorable experience.

In truth, setting up your very own limousine rental business to address the demands in various sectors of society can be a very lucrative venture. Also, you need to consider several factors in putting up the business the will affects its operation, as well as the profit it will generate for you.


Find A Suitable Location

We all know for a fact that limousines are quite expensive to purchase, but I guess you already know this even before you started the business. First, you need to look for a suitable location that will serve as a profitable target for your limousine rental business. You need to select an area where the demand for such service is high; and where potential clients and customers can easily see and reach you when they are in need of your services.

Communication Requirements

As with any businesses, you dont necessarily expect to have all your customers visit your shop personally just to inquire about your services. In fact, a large percentage of the population prefers to do their inquiries at the convenience of their own home -- either through telephone, fax, mobile phones, or email.

You need to have your limousine rental business equipped with all the necessary communication devices it needs so that it can be accessible to your home-based customers. Set up a telephone hotline, fax, and mobile phones exclusively for your customers alone. While you're at it, purchase a computer and subscribe to an internet service provider and create an email account that will serve as foundation for Internet-based communication.

Advertise And Market Your Business

Now that you have properly set up all the necessary requirements for your limousine rental business, you now need to properly market your services through advertising. You can post ads on travel magazines, local newspapers, billboard, and posters in your area to let people know you're around.

If you want to expand your business coverage in a worldwide scope, you can create a Web site that will serve as your Internet marketing strategies to improve the productivity of your limo rental venture.

By: Vanessa Doctor

How To Find Your Company's Cash Stash

How can you reduce the time it takes to send out invoices? Be the paperwork, advises Sue Gillman of consulting firm Aveus. Pretend you are a document on a journey to the invoicing department, and ask yourself these questions.

How many people touched me? Every time paperwork passes through a person's hands, it can be delayed. Figure out the minimum number of people who need to handle the invoice, and cut out any extras.

Did I get stuck anywhere waiting to be handled? For each stage of the process, set a time limit by which the paperwork needs to be processed. Otherwise, it risks sitting in a pile on someone's desk for days.

Was I prepared without error? Or did someone have to fix me? Create a checklist for employees so they can make sure the document is complete before handing it off.

By: Shivani Vora

Managing Inventory for Profitability

Any business that manages inventory lives and dies by stock levels. Knowing how much is on hand is important and easy to obtain with a physical inventory count. But knowing what items are selling fastest, how long it takes to receive new stock, and what sales are seasonal is crucial information that is more difficult to acquire.

Accounting software that includes an inventory module is the first step in gaining greater control of item stock levels, as well as profitable pricing and cash flow management. The good news is that you don't have to pay an arm and a leg to for an inventory system. Low-end software, such as QuickBooks Premium, QuickBooks Pro, Peachtree by Sage Pro Accounting, MYOB Premier Accounting Small Business Suite and MYOB AccountEdge all offer inventory management functionality.

"There were times when I was sold out, but over the course of the three years I have learned. Now we are at a point where we are almost never out of stock on an item when someone wants to order it," declares Pauline Lewis, owner of oovoo design, a handbag manufacturer based in Alexandria, VA. Lewis uses QuickBooks Premier to manage her line of handbags.

As great as this sounds, Lewis admits it took time to get to this point. She started, as most new businesses do, by trial and error. At first she set QuickBooks to alert her whenever any of her items reached an inventory level of five. Over time she identified two mistakes with that setup. The first was that waiting to be alerted until stock levels reached five was causing them to run out of stock before they could receive more, and the second was setting the alert at the stock level of five for all her items based on the assumption that all her items would sell similarly. She has modified the QuickBooks stock level alerts to be more synonymous with the individual items and how they are selling reducing her chances of running out prior to restocking.

These changes rely on the stock levels in QuickBooks always being up-to-date. To accomplish this, she makes sure that data entry occurs for customer invoices when the orders are placed, and, for vendor bills, when items are received. Both of these actions instantly update inventory and keep all her levels current. Additionally, she took advantage of the ability to create customized reports arriving at ones that are meaningful to her business.

Utilizing custom reports can help any business owner better understand the uniqueness of their business. In many cases it only takes a few small changes to a built-in report that allows it to present additional information that can make the difference between an educated decision and on based on assumptions.

"Every month I run a customized report on sales to see which items are selling the most. From there I make my purchasing decisions so I don’t spend money on items that are not moving. I may also increase their reorder limits of the popular items for the period that they continue to sell," says Lewis. She also mentions that as a result of this report she has moved some of my items to restock when their levels reach 30.

Lewis also runs customer reports that help her identify her top 20 to 30 customers for that month and the items they purchased. She has many wholesale customers and these reports help her identify their buying behavior and patterns. By analyzing these reports she has been able to increase her level of customer service by almost always having the items they want in stock and by making recommendations for new products based on what they have bought in the past.

Accounting software is much more than a program that prints checks and issues invoices. It is a great business management tool that has helped Lewis decide when to spend money, which products to buy, and how to service her clients in personalized ways.

By: Ellen De Pasquale

Keeping The Death Tax At Bay.

Roger Peugeot jokes that a fitting way for him to die would be while hugging the toilet in his basement during a tornado -- preferably in 2010. Peugeot, better known in Overland Park, Kansas, as "Roger the Plumber," owns the company that his father, Arley, founded in 1950. At age 7, Peugeot was his father's apprentice, eventually joining him full-time after graduating from high school. Ten years later, Arley died during a house call, but luckily, he had hashed out a succession plan a year and a half earlier: He gave his truck and tools to his son and helped him train two new employees. As soon as he died, Roger would inherit the business.

Things are a lot more complicated for Peugeot today. His father's once-humble plumbing concern now boasts 25 employees, 15 trucks, and more than $5 million in annual sales. Peugeot, 60, says estate taxes have become a big worry. While there is scant statistical evidence that many small businesses are affected by the levy, the so-called "death tax" is nonetheless considered by opponents to be a kind of bogeyman preying on entrepreneurs and family farms. Politics hasn't helped matters, either. In 2001, Congress enacted an eventual phaseout of the levy; in 2010, it will be repealed altogether. The problem is, the tax is set to return in 2011 unless Congress votes to make the repeal permanent -- something unlikely to happen in an election year and even less likely should Republicans lose the White House or Congress. In other words, there's no telling what will happen. "We don't know what the prospect for repeal is," notes Steve Aikers, managing director of wealth-management firm Bessemer Trust's Dallas office. As a result, he adds, the onus is on business owners to "do enough planning so they won't have a problem."

Peugeot, for one, has done precisely that. Rather than driving himself crazy with what-ifs (or praying for a timely demise in 2010), he's taken matters into his own hands. This election season, as politicians and pundits debate the issue, the master plumber will rest a little easier thanks to smart, and legal, estate-planning strategies.

Make the Most of Your Marital Status

There's at least one nice thing to say about the estate tax: You're entitled to an exemption. In 2004 and 2005, the exemption is $1.5 million. (The amount jumps to $2 million between 2006 and 2008 and hits $3.5 million in 2009 before the tax is repealed for one year in 2010.) Any amount exceeding $1.5 million is subject to a federal estate tax as high as 48%. Fortunately for married couples, the tax only kicks in upon the death of the spouse. With some planning, couples can qualify for two $1.5 million exemptions instead of just one.

To that end, in 1997, Peugeot and his wife, Diane, 55, each set up living trusts funded by personal assets like the plumbing business, bank accounts, and real estate. (There's no limit to how much they can contribute to the trusts.) Things get a little macabre here, so bear with us. Let's say Roger were to pass away this year. In that case, his trust is designed to split into two subtrusts: a bypass trust and a marital trust. Diane would be the primary beneficiary of the bypass trust, which she could use for health, education, maintenance, and support needs. She'd also be the sole beneficiary of the marital trust.

Now, let's say Diane's revocable trust is worth $1 million and Roger's $2 million. Upon Roger's death, $1.5 million of his trust would go to his bypass trust (and remain free from estate taxes), while the remaining $500,000 would go to his marital trust. Upon Diane's death, the $500,000 in the marital trust would become part of her estate value, bringing it to the $1.5 million exemption. Meanwhile, Roger's $1.5 million bypass trust would go to the couple's four children, free of federal estate taxes. It's a somewhat complicated way to get to a simple end: The Peugeot estate will have fully utilized the $3 million combined exemption available, and the children may not have to pay any estate tax.

Create an Irrevocable Life Insurance Trust

With the help of his estate-planning attorney, Kyle Krull, Peugeot created another safety net just in case his estate exceeds the estate-tax exemption. He established an irrevocable trust that's separate from his estate and exempt from estate tax. (As with the bypass trust, this irrevocable trust cannot be altered once it's established.) The trust is funded by a survivorship life insurance policy that will deliver to the beneficiaries -- Peugeot's children -- upon the death of both Peugeot and his wife, providing their four children with liquid funds to help pay off any potential estate tax owed. Because the children are the trust's beneficiaries, Roger and Diane can each put $11,000 a year per child into the insurance policy tax-free, thanks to the gift-tax exemption. That translates into a maximum of $88,000 total per year. Since 1997, Peugeot has stashed away some $200,000 into the life insurance trust. He figures his kids can't lose: Even if his estate winds up being exempt, he says, they'll just be a lot richer.

What's Your Company Worth Now

After a string of rough years and falling values for private companies, here's some good news: Now just might be the best time to sell a business that we've seen in quite some time.

Why? Jay C. Jester, marketing director of Audax Group, a Boston-based private equity and mezzanine firm, explains that many private equity companies and venture capital firms raised money for investment funds with capital-deployment time limits several years ago, and now the clock is ticking ever closer to midnight. "There's a ton of private equity with a fuse on it," Jester says. "You've got pent-up supply and pent-up demand coming together. There's activity in just about any sector you can think of." Of course, some sectors are hotter than others. Right now, telecommunications equipment and semiconductor companies are starting to fetch good prices again as those industries bounce back after having been down for years. For obvious reasons, companies involved with various aspects of security are hot -- home security systems, devices that control access to buildings, retinal identification. Many companies dominate various niches of the medical instrument sector, and as the population continues to age they'll command premium prices.

During the past several years, as the market stagnated, buyers eased their demands that acquisition candidates have at least $20 million in annual revenue -- in part because fewer companies qualified. More and more buyers are now willing to consider $10 million or even $5 million. Andrew Cagnetta, CEO of Transworld Business Brokers in Fort Lauderdale, Fla., reports that in the past five years individual buyers from around the world have started to check out businesses advertised by his firm on the Internet. They arrange to come here, and if they like what they see, they apply for a visa on that first trip, buy the business, and move here. Cagnetta cites Venezuela, Colombia, Canada, and Great Britain as some of the most common homelands of these new immigrants. In addition, says Phil Steckler, a principal with business brokerage Country Business in Brattleboro, Vt., a tight job market means that lots of downsized-out-of-a-job executives are looking for businesses to buy and run. Given the way private equity firms and their funds have multiplied, however, the odds are much better than they were five years ago that a buyer will be a company rather than an individual.

Even if you're not interested in selling your business right now, it's a good idea to put your company through a valuation process regularly (see "Judgment Day," page 69). You can even do a self-valuation; that's what Kelly Flatley and Brendan Synnott, owners of Bear Naked Granola, do quarterly (see "Maximizing a Company's Value," below). They would eventually like to sell a majority stake in their business, but because they're in no hurry, they can afford to wait for the perfect fit and the right price. Meanwhile they can hone their strategic plan and continue to grow.

By: Jim Melloan