The Rise of the LLC: A Matter of Trust
Filed Under: Delaware, Limited Liability Company, Trend Report
Tags: Delaware, Incorporating, Limited Liability Company
If you had to guess which entity is number one in Delaware – would you say an Inc. or LLC? According to a recent report found in the Fordham Journal of Corporate and Financial Law; the statistics are staggering. Since 2004 the number of LLC’s filed in Delaware has surpassed the number of Incorporations by almost 3 – 1.
The total number of LLC’s filed in DE from 2004 to 2009 was 519,000. The total number of Inc.’s filed during the same period was 189,000. There were 329,000 more LLC’s filed in DE than Inc.’s in that six year period. The most dramatic increase in the LLC’s filed occurred between 2005 and 2007. Through that two-year period there was an increase of 40% more LLC’s filed when compared to 2004. In 2007, there were 112,982 LLC’s filed in DE versus 68,807 filed in 2004. The total number of Incorporations has fallen every year since 2005. The dramatic economic crisis which began in 2008 had an impact on each entity type; although the LLC still out paced the Inc. by more than 50%. Why are these numbers important? What can we learn from them?
Well, first of all when you consider that the Delaware Incorporation has been in existence since the 1800’s and the Delaware LLC since 1991 – this change has obviously occurred over a very short period of time. The LLC is now the most popular type of entity filed in America. In fact; according to the study, the LLC is being filed by almost 11 to one over the Inc. in some other states.
Business people from all walks of life are placing a great deal of trust in this relatively young corporate entity type. In the past, most business endeavors sought the structure of the corporation to provide stability. The security, flexibility and informalities associated with the LLC have made it an obvious choice for many entrepreneurs and investors. We now live in a world that is more litigious than ever and your business deserves ample protection as do you and your assets. The LLC can typically shelter any type of business or assets and provide separation for the individuals involved. It is very simple to operate and the burden of management associated with a stock company is greatly reduced.
However, the most important factor is still – trust. The LLC has withstood the legal challenges of the past 19 years and has established itself as a very worthy entity. Also, we can conclude that the LLC is helping many individuals and small groups realize their business potential. The LLC is very well suited for a more intimate business strategy. The privacy offered is also appealing to many; since we are all faced with the threat of identity theft in this age of immediate information.
Harvard Business Services, Inc. has been filing LLC’s since 1991. We know firsthand how valuable the LLC is to most business people. The LLC may be just right for you and if there is strength in numbers…..well you will be joining a very strong group! We can help you file your LLC today.
Oil Spill or Hurricane Season……Are You and Your Business Ready?
An estimated 25 percent of businesses do not reopen after a major disaster, according to the Institute for Business and Home Safety. We all remember those horrific images from Katrina and its effect on the Gulf States and now they are being hit hard again with this oil spill. Natural and man made disasters not only effect individuals; they take a high toll on businesses as well. Getting back to business after a disaster may depend on your preparedness and planning done today. Here are some simple steps offered to help you create a disaster plan for your business.
FEMA and www.business.gov are two groups who will offer helpful support with regard to disaster preparedness. Basically, they each assert the importance of having a plan which stresses the following elements:
1.) Be Informed – know what kinds of emergencies will affect your company
2.) Continuity Planning – careful assessment of how your company functions, both internally and externally.
3.) Employee Emergency Training – your employees are your most important asset – applying internal training and structure before an event will ensure proper reaction and better results.
4.) Emergency Supplies – make sure you have the basics of survival covered – water, food, clean air and warmth.
5.) Evacuation Scenarios and Plans – deciding when to stay and leave can be the most important decision you can make in light of a pending disaster – preparing both an evacuation plan as well as an internal shelter plan will prove valuable in times of crisis.
6.) Fire Safety – Always remember that fire is the number one cause of most business disasters – take the obvious necessary steps to prevent such an event – smoke detectors, sprinkler systems, fire extinguishers and a plan of escape are all crucial, and usually prescribed by local laws.
7.) Prepare for Medical Emergencies – employee first aid and CPR training, keeping first aid supplies in stock and accessible, gathering information on existing employees medical issues and maintaining proper and accurate emergency contact information are all stressed. Installing a defibrillator in your company is also a good idea.
8.) Pandemics – get as much information as possible with regard to signs and symptoms from local health management officials and recommended prevention and control, adopt policies designed to isolate sick employees form the group – stay home directives, practice overall good health practices and programs supporting good hygiene – such as hand washing
9.) Protect your information – using techniques such as back up info. storage structure and off site information storage will help greatly reduce the risk of losing valuable data.
In addition, having a risk assessment audit done on your business is one way to plug the holes before they become giant leaks. The important thing is to follow the old Boy Scout Motto: “Be Prepared”!
15 Minutes or Less…Could Save Your Assets!
Filed Under: INC Knowledge
Tags: Business Tips, Incorporating
That little gecko has become quite popular! Seems like he is everywhere…..TV, radio, print, billboards and on the web. People are obviously concerned with auto, boat and motorcycle insurance; as many companies advertise routinely for their business. Most responsible folks are also concerned about insuring their homes, health and lives as well. All of us want to be sure that those aspects of life are protected from the unforeseen worst case scenario. There is risk involved with almost every facet of everyday life that we control with various insurance policies.
What about your business? How can you apply insurance to your business, your assets and their future? The answer is INCORPORATION!
You can find many essays and articles on the web which reinforce the advantages of incorporation. Most will stress the benefits of credibility, tax advantages and asset protection. The process of incorporation also adds security and stability to any business; much like auto insurance makes us feel more comfortable when we drive. Being incorporated will ease the strains of business risks and allow you to focus on the business itself. It will establish a separate entity apart from the individuals involved and offer the protection and separation from the negative impacts that can face your company. Liability, judgments by creditors, debt and litigation are all real worst case scenarios that every business must deal with. Incorporation will typically shield and shelter the business owners involved from those fears and isolate them and their personal assets from issues pertaining to the business.
There are still many sole proprietors who are not insuring their businesses or their assets. They and their personal assets are directly at risk with every transaction. At best, sole proprietorship is a quick way to get a business started; however once established, incorporation will typically offer immediate business stability – much like your insurance policy. After incorporating, the risks are minimized.
Harvard Business Services, Inc. has been providing peace of mind to sole proprietors for more than 30 years by incorporating them. If you have about 15 minutes or less to spend with one of our incorporation specialists or on our convenient and informative website www.delawareinc.com – we will help you form your corporation or LLC today. Life is full of risks…….we all need insurance! It’s so easy, with our help. File today!
Airlines are not Cruise Lines
This may seem like the most obvious statement of the year; however I am speaking with regard to the difference in customer service…which is becoming my favorite blog topic! If you have ever flown or taken a cruise – you will identify immediately. This recent firsthand experience I hope will present a clear example of superior customer service versus the lack thereof and offer some simple but very important clues to improving customer service in any business.
However, it is time that someone offered some proper and constructive criticism of what is probably the worst customer service possible; which is typically offered to each of us when we take a flight. This may not apply to all airlines but without mentioning names – the world’s largest airline is leading the way in customer dissatisfaction.
But let’s start with what I can honestly say was the best example of ongoing customer service I have ever experienced. Given my business and pleasure travels – this is no small remark and the “fun ships” and all their staff should take pride in exceeding my expectations and actually anticipating my needs and fulfilling them. From the moment the airline funnels you out of the gate like a heard of cattle – the representatives of the cruise line are there with open arms to greet you and give you clear and direct information and guide you to the ship. You feel appreciated with the first “hello!” From this point forward; you will encounter attention and service from people who actually address you by name and remember what you like and dislike – from your stateroom to your meals – BRAVO! You know you have been given great service when you feel as though you are leaving friends when you disembark. This was exactly the case and I am certain that some cruise lines are better than others – but this being my first cruise we simply give credit where credit is due. Imagine receiving a smile when you request a service and having it applied faster than you can conceive. Imagine paying gratuity ahead of time and then wanting to give more after your experience….yes all true. Friendliness, cleanliness, efficiency and courtesy were all demonstrated by the entire staff from housekeeping to wait and bus staff. Take my advice….take a cruise.
Now let’s talk about the airline who offered us little to no service; including information. Every time I fly, I am reminded of just how little the airlines care about their customers. From small seats and bag charges to awful food and hardly any appreciation for the $300 to $500 spent for a short domestic flight; the overall airport experience is seldom a positive one. When arriving at the gate to depart we saw a sign posted saying that our flight was delayed. There were no airline representatives present to assist with questions about that flight and connecting flights – so long story short; after calling the “help” line three separate times – I was finally told that we were stuck and there was no solution that day and we would either sleep in that airport or the connecting one or find a hotel. We ended up finding our own hotel and took a next day flight which connected to a destination 1000 miles out of our way in order to connect with our home airport. To throw salt in the wounds – that flight the next day was delayed by over an hour as well. Now, I clearly understand that weather can delay and postpone flights and I am perfectly fine with that scenario. I also am a citizen who appreciates the security controls currently in place and we always arrive two hours before to accommodate such regulations and I applaud them for making flying safer. However, when the airline waits until well after you have missed your connecting flight to give information – well that’s not acceptable. The air and attitude reflected in the personnel is clearly one of “take it or leave it”. In fact we were told at other gates that it was not their problem. Well at least we got peanuts!
The only way to change these tactics which are clearly a demonstration of a provider taking advantage of a captive market is to funnel complaints to the FAA as well as the Better Business Bureau. (Remember how you have been treated when your government offers bailouts to these companies for their internal inefficiencies as well. Yes we all know its coming!) If you have had such an experience – please pick up the pen or start tapping the keys. Flying the “friendly” skies? No thanks – think I’ll cruise! Or drive or walk!
The Best Business Skills – Hard or Soft?
Well, if you want to achieve lasting business success; you should possess both. What do we mean by hard skills and soft skills? Why are such skills so important and vital to both personal and company performance? Why are soft skills harder to develop than hard skills? Which is more important?
A good example would be as follows: Bob has a very important sales appointment with a prospect which could bring much success to his company. He has prepared diligently and has all his facts and numbers ready. His presentation is professional, well versed and persuasive. However, when his client arrives for the meeting a half hour late; Bob demonstrates his disappointment by displaying a negative and impatient attitude which undermines his presentation and leaves the client with skepticism about his ability to handle conflict and change. Bob loses the deal. All of his work and preparation (hard skills) was defeated by his lack of (soft skills) – in essence a lack of understanding and consideration.
This gives us a good opportunity to define the two: Hard Skills – are technical or administrative procedures related to the organization’s core business. They are easy to observe and quantify. It is relatively easy to teach hard skills through a formal training approach. Computer skills would be considered hard skills. Bob’s research and technical data can be interpreted as hard skills. His education and training helped him to develop those skills and he applied them in his presentation. They would also include such abilities as working with spreadsheets, operating machinery or speaking a foreign language. Soft Skills – are sometimes referred to as people skills. They are not easy to quantify and are sometimes best described as intangibles. They can include any or all of the following principles: professionalism, optimism, common sense, responsibility, sense of humor, integrity, time management, motivation, empathy, leadership, communication, good manners, sociability and the ability to teach. Although hard skills are more tangible – it is usually quite easy to identify someone with strong soft skills since they possess a natural ability to work effectively with others. While hard skills can be obtained over a definitive period of time – say through a class or seminar; soft skills can take a lifetime to develop and demonstrate consistently. Soft skills are obtained through life and personal experiences. Most people either begin to develop soft skills long before they start a career or are hindered by the lack thereof.
Everyday in business we can see how a fine balance of both is probably the best scenario. A professional who has a good technical grasp of things but still possesses good interpersonal skills will be a more effective employee both internally and externally. If Bob had applied soft skills to control his emotions and exercised more patience with his client – he would have closed the deal. So are soft skills more important than hard skills? Probably not – since demonstrating one without the other will not be an effective way of handling clients and coworkers. We have all encountered people with a great deal of knowledge; yet they seem to possess little or no people skills. We have also witnessed the other side of the equation where a person is not knowledgeable but puts on a good image and through their personality they appear confident but aren’t. The point is that the most successful professionals seem to have a balance of both soft and hard skills. They are both knowledgeable and personable. It is often said that hard skills will get you an interview but you need soft skills to get and keep the job.
