 |
| Adrian Mastracci, president of KCM Wealth Management, says “If the core business plan is ticking well, a periodic tweak ought to keep you on the right track." |
For Immediate Release
Vancouver, BC (June 6, 2005): Improving the business prospects in 2005 is a major task for many business owners. One that may need constant attention.
Adrian Mastracci, investment counsel & president of Vancouver's “fee-only” KCM Wealth Management, comments, “It has been said by others that to go far in business, you will have to stay close to it. So we will try to do just that.”
“Many businesses, large and small, private and public, continue to endure the fears and uncertainties so prevalent in this decade,” states Mastracci, “We know that thriving businesses are a must to sustain a healthy economy.”
“Business plans may have veered off course,” notes Mastracci, “They may need a little refreshing or reconstruction. Perhaps, a touch of creativity and innovation.”
“First, mull over what you would like to achieve with your enterprise,” remarks Mastracci, “Then brainstorm with your professional advisors.”
“If the core business plan is ticking well, a periodic tweak ought to keep you on the right track,” adds Mastracci.
“I call this my “AAA” business approach: assess, analyze and adopt,” explains Mastracci, “That is, assess the future prospects, analyze the present blueprint and adopt the necessary changes.”
Here are my top 10 ideas to refresh your enterprise:
1. Find a mentor
Find a mentor for your business. Someone to bounce ideas at. Someone with a wide perspective. Someone who can filter different points review and relate them to what you are trying to achieve. Someone with imagination who can be a terrific sounding board. Perhaps, to suggest an ounce of sanity when the storm clouds drift by.
2. Business plan
Fine tune the business plan. You do have one, of course. Start by revisiting your business goals. Followed by where your industry is headed. Be realistic and ascertain if what you're doing today will still get you there tomorrow. Examine what you have to do to maintain your competitive edge.
3. Marketing plan
Make sure that a well thought out marketing plan is a vital part of your business. Analyze where the competition gets its clients, and what you can do to get your message out. Revisit how you can improve your current services or products, and how you can attract new business.
4. Business structure
The business structure might use some polish. Perhaps you have a proprietorship, a partnership, an incorporated company, or a complex set of holding companies. Evaluate the business reasons for having what you have now. Then examine if you can benefit by modifying the structure.
5. Succession planning
Reflect on the financial ramifications and who will take over in case of a disability, retirement or death. This helps prepare your vision for the business succession. Begin the process that identifies the competent person to guide your business. Perhaps there is someone in the family who can take the reins. This process takes time, but is one of the best investments you can make.
6. Estate freezing
You may decide on an estate freeze to place a limit on the growth for your account of some of the assets you currently own. The future growth can then be passed to other family members. As you wrestle with business succession planning, determine whether it makes sense to consider some form of estate freeze for the business assets.
7. Managers as owners
Consider whether it is appropriate and beneficial for managers to be shareholders of the enterprise they are entrusted to guide. Review the arrangements to sell shares to key executives, especially in private companies. Managers that own a piece of the rock think differently.
8. Management remuneration
Review the remuneration of owners and key personnel. Consider the affects of a mix of salary, bonus, dividends, stock options and paying for their financial and investment planning services.
9. Capital gain exemption
Analyze whether crystallization of your business, or operating farm, qualifies for the $500,000 capital gain exemption. The full exemption can save taxes approximating $110,000 in 2005. Therefore, examine the steps to meet the qualifications.
10. Small business limit
Pay attention to the lower rates of tax on the qualifying small business income in 2005. Each province and territory is a little different. See the table below for a taste of selected 2005 combined tax rates.
---------
“Refreshing your enterprise is like receiving a bigger dividend,” concludes Mastracci, “All the best in your quest.”
2005 Corporate Tax Rate Ranges
| Corporate Income Category |
Tax Rate Range* |
| Small Business Income to $300,000 |
15.6% to 20.6% |
| General Active Business Income |
31.0% to 39.1% |
| Investment Income |
47.3% to 52.8% |
|
|
