But this notion, mind you, is not universally held. Many businesses – and the branding agencies they hire to help them – have lately leaned toward combining letters and sounds into invented names that are hard to pronounce or understand.

Others prefer to aim for fresh, unexpected names that you don’t need a computer to decipher. One such advocate for fun and likable names and taglines is a San Francisco-based naming firm called Eat My Words (www.EatMyWords.com) that specializes in helping people who find themselves in a business or product-naming pickle.

Here are some naming tips from the pros at Eat My Words who come up with creative brand name suggestions and emotionally-driven company tag lines daily:

Naming a Business

1)    Don’t name your business after yourself. As tempting as that might be, the name is essentially meaningless to your future customers and evokes nothing about your business. What’s more, many names are hard to pronounce, spell or remember. One exception: If your name lends itself to clever word play such as a consultant named Steven Lord who call’s his business “Lord Knows.”

2)    Don’t date your business name. If you select something trendy or numerical (i.e. Women 2.0) the name might appear dated in a few years. Stick to names that can withstand the test of time.

3)    Use a name that will scale to fit future products. As Eat My Words notes, you don’t want to outgrow your business name. For example, if Amazon.com – which originally sold only books — had named itself Bookstore.com, they’d have painted themselves into a corner that would have made it difficult once they started selling anything and everything.

4)    Your name doesn’t have to convey trust and credibility.  That’s something you build through your logo design and marketing materials. If you try to build that into your name, you’ll likely end up with some hopelessly boring options.

Naming a Product

1)    Keep it simple and conceptual.  According to Eat My Words, basic yet powerful words make for the best product names. A few they’ve created include a travel make-up kit named Dash; an all-natural energy drink called Bloom; and a line of gourmet dips for kids called Monkey Dunks.

2)    Avoid acronyms. You should only expect people to remember one name, not two. Brand your product with a full name and let the acronym be something you only use internally.

3)    Name you product before your company. That’s not always possible, of course, but if people only remember one thing, it’s better they remember the name of the thing they will actually be buying (and searching for online).

4)    Select names that work as a family. Apple, for example, created a family of products that all fit together by using the same naming convention around “i” including iMac, iPod, iPhone, iTunes and iPad, among others.

Naming a Brand

1)    Define the personality of your brand in three words that will be your acid test. When Alexandra Watkins was naming her naming agency, she wanted to convey that the brand was “playful,” “creative” and “unexpected,” which lead her to Eat My Words. Something like ABC Name Bank simply wouldn’t have cut it.

2)    Your brand name should be spelled exactly how it sounds and be easy to pronounce. This certainly bucks a popular trend these days, but if you don’t follow this rule you’ll be constantly telling people how to spell or pronounce it. Your brand should be approachable – not something people struggle with and are embarrassed to try and pronounce.

3)    Choose a brand name that’s meaningful to your customers. Names with hidden meanings or foreign phrases can’t stand on their own, and you won’t always be there to explain. Each time you have to explain what your name means you are apologizing for it.

4)    The name should create a picture in the customer’s mind.  That’s because people remember pictures more easily than they remember words or letters.

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Right now, you’re probably scrambling to find new customers or clients. You’re hustling to handle 101 day-to-day tasks and perhaps manage employees or independent contractors as well. No matter what the economic conditions are, however, it’s vital to be vigilant in two key areas:

• Keeping the customers or clients your business already has; and,
• Keeping employees loyal and motivated even if raises, bonuses and benefits aren’t in the cards.

Now that the job market is improving a bit in many industries and areas, restless employees may be less inclined to stick around. If they don’t feel like you’ve treated them well or appreciated their hard work, they’ll look for something better.

Customers present an even greater challenge. For most growth-minded entrepreneurs, the tendency is to focus on new business development. But that might have it backwards. The first move should almost always be to keep what you’ve got, because it costs twice as much to gain a new customer as it does to retain an existing one.

Here are 10 tips to amp up loyalty at a small business – five ways for customers and five for employees:

Keeping Customers

1) Provide more frequent progress reports: Show your customer or client the work you’ve been doing and the results you’ve achieved. This will help answer un-asked questions and allay latent fears.

2) Get some face time: If you deal mostly by email, web-connection or phone, make an effort to meet in person. Seeking “face time” says you are interested and gives you an opportunity to literally see things for yourself that can lead to improvements or new business. It’s also a great way to generate referrals.

3) Ask for feedback:  Never assume a customer is completely satisfied. Throughout the sales or work process (whatever that might be for your business) ask how your customer feels about what you’re doing. Then take action on any suggestions. Think of yourself as a waiter who checks back periodically throughout the meal to see if everything is okay.

4) Tune your product or service offerings:  As proud as you may be about your product or service, remember it’s being made or done for the customer or client – not you. Make certain you know what they want, and when they want it.

5) Be open to making changes: Customers may want to change terms, conditions, purchase orders, payment processes or other things. Customers will appreciate if you show a willingness to work with them on adapting to new conditions.

Gaining worker loyalty

Ed Hess, a professor at the University of Virginia Darden School of Business, offers these employee loyalty suggestions:

1) Say thank you:  It seems so simple, but just telling your employees “thank you” when they’ve done a great job will go a long way. Verbal recognition boosts morale and builds mutual respect. “As a result, employees will not only work hard for you, but they’ll stick with you through thick and thin,” says Hess.

2) Give low-cost bonuses and perks: If you can’t give significant raises or bonuses, show appreciation with less pricey rewards. Options include gift certificates to local restaurants, movie tickets or maybe a paid Friday afternoon off. Also, providing a catered lunch once a month or doughnuts in the morning is a good way to boost loyalty.

3) Help them improve themselves: Your employees will appreciate your willingness to help them invest in their futures. Consider paying for them to attend a class at a local community college or a seminar that interests them (and could help your business, too).

4) Help them get healthy: Providing employees with a gym membership is a great way to say “thank you” and can have multiple benefits. Find out if a local gym will offer a group deal.

5) Ask their opinion:  Employees appreciate being asked what they think. Solicit their ideas on how the business can be improved. You might be surprised by what you hear.

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So it simply makes sense to not only foster more referrals, but also be smarter about the ones you get.

Membership type businesses, such as health clubs, constantly run referral programs by offering existing members discounts or freebies for bringing in others. But small business owners of all types know the magic of referrals, which offer instant credibility for what you sell.

Finding and using referrals effectively, however, can be harder than it looks. Referrals come in several different flavors. If someone merely provides you a name or email address, that’s a low-grade referral. But if an existing client actively talks up your product or service, sets up a meeting or brings the prospect in, that’s a superstar referral.

Here are eight ways to get more and better referrals:

1. Create a referral-generation plan and put it to work

Referrals aren’t automatic. Some business owners assume that a great product or terrific customer service will automatically generate referrals. Not so. You have to ask. Don’t be shy. Most loyal customers are open to providing referrals. Some even appreciate the opportunity to tell friends, family and associates about something good they’ve discovered.

2. Ask at the right time

Timing is important, but many businesses ask for referrals at the wrong time. The worst time to ask is at the cash register or when you present a bill. Instead, look for opportunities earlier or later in the process when customers are more receptive.  There’s really no predetermined time to ask. Do it whenever opportunities arise.

3. Provide some support

Don’t ask customers to recommend you to others without providing them some kind of backup or support. It can be as simple as a supply of business cards, a link to a special page on your website. It could also be a brochure or some other type of printed material that reinforces the referral and describes what you do.

4. Offer appropriate incentives

The incentive you offer must fit with the kind of business you run. It could be a discount, service credits, an upgrade, a free item or some other trigger that will entice clients to provide referrals. Test different offers to find out what works best.

Communicate details of your referral program to your best customers through whatever means you have available, including a blog, newsletter, email or customer mailings. And be sure to thank customers when they make referrals.

5. Get the right information

When asking for referrals, consider using a form, checklist or web-based system that requests details that will make the referral more valuable. A simple name and number isn’t really a referral at all. It’s just a lead.

At the other end of the spectrum are referrals where the customer actually facilitates a meeting, visit or purchase by the referred person. This makes the customer an active agent on your behalf. Between these two extremes are referrals where the customer authorizes you to use their name when contacting somebody.

6. Target your most influential customers

If resources are limited, consider seeking referrals only from your most influential customers.  These might not actually be your best customers, but they are the people whose opinions would carry the most weight with other people in your industry, community or customer base. By targeting these influencers, you avoid spreading yourself too thin or generating weak referrals.

7. Target related businesses

The health care profession is one of the most adept at fostering referrals between complementary disciplines – specialists, imaging services, physical therapists, medical equipment suppliers and others. Consider the same strategy yourself. Contact businesses that provide complementary services to your own and ask for referrals.

8. Build your relationships

This takes time, but it’s critical because many of your most influential customers won’t provide referrals until you gain their complete trust.  You’ll want to treat each customer contact as if it’s critical to your next referral. Through each sales, marketing or customer service “touch” you are building a foundation of trust that that will one day lead to a valuable referral.

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What’s up with that? In most cases it’s simply because you didn’t think beyond a great-looking ad, perfectly crafted email, irresistible offer, rousing radio spot or breakthrough banner. Those items – the so-called “creative” – are but one piece of the marketing effectiveness puzzle.

The missing piece is often a data-driven strategy for getting the message into the right places at the right time with the right frequency to make the effort truly pay off.

Art or Analytics? (Hint: Both!)

Another way of framing this issue is to ask a relevant question: Does marketing success come more from art? Or analytics? Some also cast this as a difference between “soft” marketing (art) and “hard” marketing (data-based).

Until recently, most marketers would have fallen back on the old 80/20 rule, explaining marketing as mostly about art, and much less about data or analytics. Lately some folks have made it out to be all about data and analytics – a reversal of 80/20 in the other direction.

In reality, it’s probably in between. Content (another word for creative) is, in fact, more important than ever in a world hungry for good ideas, nicely packaged and digitally delivered, but drowning in a sea of digital mediocrity. Wearing your business owner’s marketing hat, your job is to build trust with customers and prospects by educating them about how your product or service can benefit their lives or businesses so they will think of you when they need what you offer.

In short, you have to break through the cacophony of constant “noise” in today’s digital, Internet- and social media-based world to make sure customers are hearing you.

Strategy and Analytics

Even the best marketing ideas will fail without proper planning, preparation and implementation. This is the strategy part. For example, what’s the main audience for your killer creative?  If you’re fuzzy on that, you’re in trouble to start. Or even if you do know exactly who you want to reach, if you don’t know how or where to reach them, that’s another dark cloud ready to rain on your marketing parade. And if your offer or call to action haven’t been thought through, honed and tested, you’re similarly doomed.

Think of it this way.  Even a mundane ad, direct mail piece, radio spot or email will generate some results if properly targeted. What you need is the best of both worlds to make it really sing.

And you absolutely need to learn exactly how and why your hard-earned marketing dollars are netting you a return or not, and what you can and should do in the future to squeeze every ounce of improved profit from your effort. This kind of metrics-focused marketing starts with three main activities:

1. Setting goals and targets up front. These should include such things as how many incremental sales are generated, how much revenue each sale produces and the gross margin. In short, you want to know precisely what impact your marketing efforts are having on revenue so you can make changes as needed.
2. Designing or selecting your marketing programs to be measurable in the first place. You’ll want to know the incremental contribution of each individual marketing effort you undertake in order to compare results.
3. Focusing on decisions that will improve your marketing results. The idea is to adapt and make changes along the way.

Here are three key marketing metrics most small business should consider:

• Lead Conversion Rate: Converting leads into sales is what really counts. Your conversion rate is the percentage of leads that ultimately become sales (10 sales from 100 leads = a 10% conversion rate).
• Revenue Per Customer:  Once you know how much the average customer is spending, you can make better decisions on whether to focus on new customers, selling more to existing customers, or both.
• Customer Acquisition Cost: This boils down to what it costs you to gain a new customer. It’s a critical number to know for deciding what you can spend on your marketing efforts.

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Sometimes however (not that this includes you, of course), business owners don’t make the best planners. “We are action-oriented people,” says Bill McBean, who launched and sold several businesses and is now General Partner in the family-owned firm McBean Partners. “But by taking a hard look at a few key places and putting a plan in place you can bank on a more prosperous future,” he says. McBean, author of The Facts of Business Life (Wiley, 2012) suggests these ways to put your re-energizing plan in place:

1) Improve your own leadership skills

Since success starts at the top, you should evaluate where your own leadership skills need improvement. Start by looking at what’s working for your business and what’s not. Evaluate honestly how things are going. Are you supplying the business with what it needs to succeed – equipment, time, capital and resources? Are you paying employees based on what you want them to accomplish? Have you let any bad habits slide that need addressing? Now you can look ahead and decide what you need to do differently.

2) Do a full review of systems and procedures

In essence, systems and procedures actually operate your business, thought many owners misunderstand this concept, says McBean. Again, evaluate what’s working and what isn’t. Look for outdated processes that continue merely because “it’s the way we’ve always done it.” For example, inventory must change with the market, along with pricing and policies, since what sold well a few years ago might not sell well now.

3) Go on a gross profit-building mission

This step alone is one of the business owner’s most powerful weapons. Look for ways to cut costs and increase gross profit. “Don’t assume you know how much things are costing you,” says McBean, “or that your employees are reacting to new sales opportunities.” Ask yourself: What expense mistakes did we make last year and how can we avoid them now? But don’t cut just for the sake of cutting. Look for smart ways to save money and start building a cash cushion.

4) Re-engage employees

A successful business needs employees who care as much about the company as you do. “Engaged employees are energized,” says McBean. “They handle problems on their own and actively look for ways to improve the business.” Seek out new ways to show employees you care. Even a simple “thank you” can help tremendously. A paid afternoon off, movie passes or other small perks also work wonders. Find out what frustrates employees most in their jobs and – if possible – supply tools or training to improve the situation.

5) Set specific goals and amp up the energy

Your goal with goals is to aim high, but be specific, says McBean. And remember that goals must be measureable. If goals are not measurable you can’t gauge progress and will eventually abandon them. What gets measured gets done.

6) Boost you product or service offerings

Can you squeeze out another product or service from what you already have in place? “For example,” says McBean, “there’s nothing stopping an auto parts store from selling marine industry parts, especially if you’re located near water.” People need what they need, when they need it, so make it easy for customers to get what they want. And don’t ignore the power of impulse purchases or convenience items – even if they aren’t matched up with your core products.

7) Revamp your marketing

Look careful at who your customers are now. Have they changed? Are you trying to reach them in ways that make the most sense? For example, might the money you’re spending on ad placement be better spend on direct mail or online? Does social media marketing make sense?

8) Look for ways to impress loyal customers

Your customer base is critical so it’s essential you find ways to foster loyalty. Beyond offering a great product or service, what will keep customers coming? The prize goes to business owners who are more creative in answering this question, and who offer more than simply what customers “expect.”

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Now the business owner duo share what they learned along the way with other business owners. One of their major lessons: Improving your business by admitting mistakes. Houlihan believes that customers judge you more by how you react to mistakes than how you behave when all is well. “Every business makes mistakes,” he says. “Denying that they’ve happened only makes an already awkward situation worse.”

In short, dodging responsibility hurts your reputation more than if you’d owned up in the first place.  (In this vein, my posts on avoiding the accountability blame game and how to create a winning business culture might also be of interest.)

Since they knew almost nothing about wine making or the wine business at the outset, Bonnie and Michael – who’ve written a book called “The Barefoot Spirit” (Evolve Publishing, 2013) – made their share of doozies. Some even threatened the entire business. So they quickly resolved not to fret errors, but rather make them opportunities to grow.

For example, Barefoot once put the wrong bar code on a store’s shipment of Cabernet, causing it to ring up at a lower price. Barefoot itself caught the mistake and Michael quickly showed up at the store’s corporate office with a check for the store’s loss, plus extra for the expense of dealing with the mistake. He then informed the manager in detail how Barefoot was changing its internal processes to make sure the bar code problem would not happen again.

Here are five things that must happen for mistakes to make your business better:

1)    You own up

This can be tough, and uncomfortable. But you need to utter the mea culpa and acknowledge that you are, in fact, not perfect. The sooner you own up, the easier it is. There’s less drama and you can get on with fixing the situation faster. Besides, says Houlihan, people actually like a little imperfection now and then. It shows a level of authenticity, vulnerability and humanity. And it’s hard to be angry with someone who says, “You’re right – I messed up.”

2)    You figure out how it happened

Admitting fault, however, isn’t enough. If you simply try to put it behind you you’ve just increased the chances it will happen again. Dig into it. Find out why the mistake occurred so you can fix the faulty procedure or process. That’s why Barefoot Wine made sure its employees weren’t afraid to make or report mistakes – those that involve technical errors, that is. Houlihan is adamant that bad behavior or inability to perform should not be overlooked. “Real progress in progressive companies is often built on the backs of mistakes and the improvements they spark,” he says.

3)    You don’t blame, you aim

Sometimes it might be easy, and temporarily satisfying, to point the finger at someone for a mistake. But if it happened on your watch, and you are accountable for the finished product, you ultimately share the blame in the customer’s eyes. So get to the bottom of what happened and aim your focus on what you and your business can do to prevent the mistake from happening again.

4)    You write it down

This is an important but often overlooked step. If you successfully resolve whatever sparked an error, pat yourself on the back and say, “Well, that’s cleaned up!” you’re making another mistake. If you don’t write down or record it in some way, even you (not to mention others) are in danger of repeating the original error. Says Houlihan, “When you’re still smarting from the pain of a mistake it’s easy to think you’ll always remember what went wrong. But over time things get fuzzy and you won’t.”

5)    You resolve it won’t happen again

Along with your apology, assure the injured parties that it – whatever “it” was – won’t happen again. Voluntarily describe how the mistake happened and what changes you are implementing to prevent its recurrence. And most importantly, tell the other party how you and your business are going to make things right. Handling an error this way will reinforce the feeling that you are, ultimately, a trustworthy company.

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As with so many other things in business, the answer is: “It depends.” One thing is clear: Small businesses are moving headlong into online networking via social media, with 90% saying they’ve jumped in, according to a survey by the online small business community Manta. Among small businesses using social media, 78% report that at least 25% of their customers are now finding them via social channels.

And in a recent survey conducted by Vistage International (a peer advisory firm for business executives) and The Wall Street Journal, 60% of the 835 small business owners surveyed said they’ve had success growing their businesses with social media.

But the tools and platforms they use vary greatly, and “success” depends on the type of business they have and how they use the social media tools and platforms.

Biz Owners Find Success with LinkedIn

Surprisingly, 41% of the owners in this particular group named LinkedIn as the most effective for them – more than any other social media platform. I’ve written before about the importance of small businesses having a company page on LinkedIn, but a relatively small portion of businesses have done so, making this survey’s finding a bit of a stunner. The online video service YouTube was named most effective by 16% of the businesses, while Facebook was considered most beneficial by just 14%.

A mish-mash of other social media platforms (including Pinterest and Google+) account for the remainder of the “most effective” votes, with Twitter being named by just 3% of business owners as their top social media outlet for helping them grow. In part that’s because just 14% of business owners report using Twitter at all, and Twitter is just now getting around to promoting its services as a tool for business.

How do small businesses find the time?  Increasingly, some are getting employees involved, with about 40% now saying they have people dedicated to social media campaigns. The rest, presumably, are flying solo. Overall, the businesses involved aren’t spending that much time on it, with about half saying they spend 1-5 hours weekly, and a third spending almost no time at all. A few, however, spend upwards of 10 hours weekly.

Pinterest Works for Visual Businesses

As interest in visually display grows, businesses that have interesting photos of what they sell (such as a kitchen remodeler, wedding photographer or jeweler) are finding success with Pinterest, the online photo sharing site. Some now report 10 times as much website traffic coming from their Pinterest pages, compared to Facebook.

Professionals, such as attorneys, architects and consultants, are finding LinkedIn to be a top performer, while small retailers tend to get more traction with Facebook (see A 10 Step Facebook Cheat Sheet for Biz Owners).

How do business owners measure social media success? Being found by customers is the benefit most often named (35%). Referrals and the ability to find and engage with prospects (lead generation) also rank highly.

Clearly, most small businesses want to link social media activities to sales as directly as possible. Thus, having customers find them and buy something is valued most highly.  But don’t overlook customer retention and loyalty, which also play an important role in calculating the value of social networking.

Go Where Your Customers Are

In many respects, it comes down to this: If your customers and prospects are online and in social media (and they are), you must be too. “As 97% of consumers use the Internet to research products or services in their local area, and those searches regularly include company name, product or service, or business owner, it’s critical small businesses build awareness of themselves and their company online,” says Jed Williams, program director at the leading research and consulting firm BIA/Kelsey.

Take it from Joseph Buczek, president of Lighthouse Construction and Restoration, an Indiana-based remodeling and repair firm. “Over time, I’ve realized that it’s very important for me to maintain a consistent online presence for both my business and myself,” says Buczek. “More and more consumers – my prospective customers – are looking online for information about remodeling companies, so I need to be there when they are.”

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For one thing, Internet usage continues to soar. Going online is now a reflex action rather than a conscious decision. Some people spend most of their day online, switching between their PC, mobile device, tablet and TV. Connection speeds have increased sharply and businesses as well as consumers are doing more and more things online.

Online Retail & Services Soar

According to a new study by the research firm IBIS World, the biggest money making opportunities are in the retail and service sectors. And here’s more good news: Many of the things once done only by the most tech savvy big businesses are now within range of small operators with little or no tech expertise. Basically, you can tap into whatever tech or expertise you need by using third-party vendors to develop websites, provide e-commerce capabilities and much more.

And the cost of Internet storage has never been cheaper. These factors and others have combined to make starting an online business easier, quicker and less costly than ever.

Here are eight types of high-potential businesses that are easy to get into and are experiencing major changes of the kind that spell big opportunities.

1. TV and Home Theater Installation

Few industries are as fragmented as this, or as easy to enter with little capital. Some 94% of U.S. households have a TV; 84% have a DVD player and about 25% now have a home theater. It’s now a $12 billion industry, although you’ll definitely need to keep up with fast changing technology.

2. Virtual Data Rooms

The VDR industry is growing quickly at about 16% annually since 2008, with revenue expected to reach $728 million in 2013. The proliferation of online document sharing services has helped the industry flourish. With low barriers to entry, IBIS World expects this industry to expand at an annualized rate of 17% over the next five years.

3. IT Security Consulting

This industry has benefited from increasing adoption of e-commerce, growth in mobile Internet access and some high-profile data breaches. Over the last five years, revenue increased at an annual rate of 9.8% to $5.3 billion. As businesses buy more and more computers and software, the need for IT security advice grows.

4. Travel Agencies

Outdated storefront travel agencies are giving way to online services, which offer a relatively high-profit, low-cost way to handle transactions. This segment of the industry has grown significantly and will likely continue to display strong growth during the next five years.

5. Online Shoe Sales

Consumers love buying things online – especially shoes, accessories and the like. Industry revenue has been growing at a robust 16% annual rate. Every year, more than 100 million Americans purchase goods online, one of the fastest-growing industries in the U.S.  Traditional brick-and-mortar retailers have an opportunity to enter the online realm and recapture sales taken by retailers that operate exclusively online.

6. Digital Forensic Services

This industry has also benefited from growth in mobile web connections and a rise in the percentage of households with at least one computer. The amount of information stored electronically is skyrocketing. Digital forensics helps find and analyze digital information for various legal purposes. While there are few prohibitive licensing or regulatory barriers, this business does require more capital than others.

7. Translation Services

Globalization and an increasing number of non-native English speakers in the U.S. have helped fuel growth here. The Internet has also fostered demand for translators because businesses expanding into new countries must adapt websites and marketing materials to the new region. Technology has helped automate some of the process, improving the speed and accuracy of translators.

8. Social Network Game Development

This industry has grown an astounding 184% per year during the past five years, driven by surging Internet and social network use. As smartphones and tablets proliferate, people can now access social networks anywhere, any time. Indeed, according to a report from research firm Nielsen, consumers spend 20% of their total time online using social networks on personal computers and 30% of their time online visiting social networks on mobile devices.

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Official start date is January 1, 2014, but some provisions are already in place (such as healthcare tax credits for small biz) with more coming soon. Time to buck up and figure out what it means for your business, what steps you need to take and how you’re going to deal with the changes.

Many business owners and entrepreneurs are still in “wait and see” mode. That could be a mistake if you end up overpaying for existing coverage, or want to get first time coverage and face health expenses before getting your coverage in place.

Details Unfolding

Details of healthcare reform are starting to unfold. The U.S. Small Business Administration, for example, has launched a new website (SBA.gov/healthcare) and blog (sba.gov/blog) devoted exclusively to explaining it for small business. And while the SBA’s take on ACA is certainly biased to the upside, this new resource does offer a helpful gateway to information about how it will work.

Keep an eye out for something called the Small Business Health Options Program or SHOP. This program, launching in October, is designed as a (relatively) hassle-free way for you to find health insurance. If it works as promised, you’ll be able to choose the coverage level you want, what portion of employee costs you want to pay and tap available tax credits. You can sign up to receive email updates about SHOP at the HealthCare.gov website.

Starting in 2014, you or your small business can also get insurance through a new type of non-profit, consumer-run health insurer called a Consumer Operated and Oriented Plan (CO-OP). As with other co-op setups, these insurers will be run by their small business and self-employed customers themselves. Such CO-OPs are meant to offer consumer-friendly, affordable health insurance options to small businesses and must meet the same state and federal quality and financial standards as other plans. You can find more at the HealthCare.gov website.

Here are some key provisions based on the size business you are, from self-employed to 50+ employees.

Self-Employed

Health insurance coverage for the self-employed will be in place and available through a new competitive health insurance marketplace in each state no later than January 1, 2014, with open enrollment starting October 1, 2013. You’ll be able to choose from four levels of coverage that pay different percentages of your costs.

Under 25 and Under 50 Employees

One provision already in place is a tax credit (way better than a simple deduction) for small businesses with fewer than 25 employees that pay a portion of employee health premiums and meet other criteria. Right now, the credit maximum is 35% of what you pay for coverage and that will go to 50% in 2014.

Small Business Majority, an advocacy group for small business, has a handy Health Care Tax Credit calculator on it’s website. You’ll see it on the right side of the homepage at: SmallBusinessMajority.org.

Also starting in 2014, businesses with fewer than 50 employees can use the SHOP system to secure coverage. The assumption is that competitive pricing and pooled purchasing will lower costs significantly, although that’s yet to be seen.  Right now, small businesses pay about 18% more on average than big companies for equivalent coverage.

50 or More Employees

This is where mandates kick in. Starting in 2014, businesses with more than 50 full-time (defined as working 30 or more hours weekly) employees must offer health insurance or pay an “assessment.” The details of this “Employer Shared Responsibility” and other ACA tax provisions are available on the IRS website at IRS.gov. See Affordable Care Act Tax Provisions under “Hot Topics.”

Starting in 2016, businesses with up to 100 employees will be able to buy health coverage through SHOP.

Here three other helpful features available on the HealthCare.gov website:

• Timeline for implementation: What you need to do and when.
• State-by-state breakdown of new healthcare options for small businesses.
• A glossary of healthcare act terminology.

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But most businesses can grow successfully by using one or a combination of other financing approaches that don’t require major commitments or outside investors.

The idea is to prepare and position your business for growth so you don’t miss out on growth opportunities when they arise. A big part of that is not only keeping your current balance sheet in shape, but also lining up potential funding sources.

It starts with understanding the different options, and that alone can be challenging. For example, an American Express survey found that 34% of business owners believe – incorrectly – that a business “term loan” (funded immediately for a set term and amount) and a “line of credit” (which you open and tap as needed) are essentially the same. And nearly 40% believe it’s a good idea to apply to as many lenders as possible when seeking a loan, when the opposite is true. (Multiple applications can harm your credit rating.)

Here are five ways to position your business for all the future funding you’ll need:

1. Reinvest your profits

The best source of “venture capital” for an existing business is money you’re already generating. This is “patient” capital that builds value in your business without debt and without giving up shares to others.

Many entrepreneurs miss growth opportunities by spending profits in unproductive ways. Others take the opposite extreme, pumping every penny into the business while taking nothing for themselves.

Both can backfire. If you do need to seek a loan, lenders will prefer that you pay yourself a reasonable salary. They want to know the business can be profitable even if those running it get paid.

2. Tap into trade credit

“Trade credit” is a way to put off payment for goods and services your business purchases from suppliers and vendors. You may find vendors more than willing to sell on credit to a growing business – and even to a startup – if you can strike a long-term deal to buy from them.

And from your perspective, trade credit is also one of the safest forms of business borrowing. Bank debt is dangerous because payments are still due even if sales drop. But if sales drop so will your orders, so your level of trade credit drops too.

Trade credit may also be more readily available than bank or other types of loans. And it lets you spread payments over months or even years with little or no down payment and generally favorable rates.

3. Line up a credit line

The time to establish a line of credit is when you have the ability to qualify for one and might not really need it.  Having a line of credit can help you grow by providing ready financing when opportunities arise. A line of credit is also vastly preferable to using credit cards that carry much higher interest rates and other onerous terms. But use your credit line cautiously. Lines are meant to be tapped as needed, then paid off so they are available again the next time.

Establishing a credit line is cheap, you only pay interest on what you borrow and you can use the line for almost anything. Start small – basically with whatever size line a lender is willing to provide.  The important thing is to get a foot into the bank financing door. Once you have it, put it to use and pay it off diligently and always on time.

4. Expand your banking relationships

If you have accounts with only one big bank, consider opening additional accounts at a regional or community bank (or vice versa). That will give you more options when it comes time to look for loans, lines or other services to support your growth plan.

5. Consider alternative sources

A few options include credit unions you may be eligible to join, accounts receivable financing (also called “factoring”), and so-called “peer-to-peer” lending. Peer-to-peer (or person-to-person) lending is handled online through a variety of web-based services that function as intermediaries, including Prosper (www.prosper.com) and Lending Club (www.lendingclub.com).

Copyright © 2000-2012 BizBest® Media Corp.  All Rights Reserved.  Follow @140Main