Monthly Archives: June 2012

More Things to Think About

If you’ve been following along with this blog you realize that we have only just begun to scratch the surface of starting a business. And the decisions keep coming. Here are just a few more that you’ll have to face:

A business name. It can’t be too stupid or have no meaning but it also must mean something to you. It also can’t be already taken, especially in the state in which you will start your business, either as a corporation or as a self-proprietary business. Oh and on that note you need to do a search in your state of choice so that it is yours.

An EIN. That is an Employment Identification Number. This is of course so that you can pay your taxes. Oh yes, those pesky taxes. You should feel happy to do this (I’m not joking). I would rather pay into the system than be a free loader living off the system. (Yes, I have issues with this particular issue!) And the more you pay into the system, the more money it is that you are making. (I like that idea.)

A website. A must in this digital age. I have many times saw something or a business and tried to find them on the internet only to learn that they have no website. (Yes, I live in a rural, small town area. Still they should have a least a website for information or phone numbers.) I am not a website guru, or even an amateur, but as with all things, there are people out there that you can pay to do a good job on the website. And it is good money spent.

Email account. Where ever you have it, it is the way to still communicate. How do people live without email?

Advise. This covers a lot of area. GET ADVISE! You will need tax advise, bookkeepers, lawyers… yes, lawyers. You want to make sure that everything you do is on the up and up and that you limit your liability. Don’t hesitate to ask for help.

Start up capital. This is the tricky one. Sometimes you can do this on a shoe string, depending on how much knowledge you have or friends that you can get to help you. If you don’t have either of these, then you will have to have working capital to pay for these things. Be it a loan, your own savings, family support, or… well, be creative.

Social media sites. Still working on this one and it will be addressed in a later blog. (I’m not a teenager, so it doesn’t come naturally to me. I’m still learning!)

And here is another big one that I will discuss in depth in a later blog. You need product. That means manuscripts. You are a business. You need to sell things. That means you need things, books, to sell. If you do not have a large number of manuscripts, well written manuscripts, then you must find authors to fill that need. As with all publishers, we are always looking for new authors with great stories.

Have I detailed everything needed for your publishing business… no. But I’ll keep adding more as it comes. Stay tuned.

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Which State is Best?

The next big decision to think about is where to incorporate. This plagued us. You see one of lives in Montana and one in South Dakota. While neither is the ideal state to incorporate in, we had to weigh the cost and idea of paying a person to be our registered agent in a state that neither of us lived in… but I digress.

There are three excellent states to incorporate in, Delaware, Nevada, and Wyoming. All have their advantages and disadvantages. Again, use Google and you’ll find more websites than you care to read, discussing the pros and cons of each. Delaware is the oldest and has the most advantages for large corporations. Nevada has some tax advantages for small businesses, however, some of the newer laws make that less then before. Wyoming is the new kid on the block for small businesses. All require you to have a Registered Agent in the State.

This is a person/business that has an address in the state in question so that if there are any legal papers to be serviced on the business, they act as your representative. There is a yearly cost to this which adds to the cost of incorporating. Nevada and Wyoming have no corporate income tax, while Delaware has many laws that help protect corporations (that why it’s a favorite of all the really big corporations).

Also factor in the state in which you live as a place to incorporate. What are the costs to incorporate in each? The filing fees? The registered agent fees (you act as your own if you incorporate in your own state)? Does the state allow out of state owners (foreign ownership)? How important is convenience for you?

These are just a few of the considerations you need to think about. As for us, we chose to incorporate in Montana. Besides considering all of the above questions and more, we also had to consider that my family would probably be moving within a year or two, while Jason’s situation is more stable.

Each person’s situation is unique, just like their publishing business. Figure out what is best for your situation. No one can make that decision for you. Good luck and stay tuned.

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What kind of business?

Okay, so you’re going to start a publishing business. First a disclaimer… I am not a tax adviser. I am not a lawyer. I am not giving you advice. I am merely telling you our thought process and what we choose and why. Now with that out of the way…

The big decisions are not over. You have to decide what kind of business do you want to set up; a self-proprietary, a limited liability corporation, or a regular corporation. A quick and dirty explanation. (For a more detailed explanation Google them. There are tons of websites out there that will do into more depth and detail on this subject.) A self-proprietary business is one where you own it and you are totally responsible for all profits and losses, including all liability. A corporation is a legal entity of its own and pays its own taxes to the federal government. You are the employee and also pay taxes to the government on your earnings. Because it is a separate entity, the corporation accepts all liability. A limited liability corporation is a mixture of the two, sort of. The important thing is that the liability is the responsibility of the business. The owners liability is limited, hence the name.

When I first started out, for about a month, I was a self-proprietary business. I filed a DBA (doing business as) with my state and puff, I’m a business. (DBA is so that you can run a business in a name other than your own personal name. For instance, I could be Angela Abderhalden Book Publishing. My name is in the name of the business. But if I wanted to be ABC Publishing, I have to file a DBA.) When Jason and I decided to go into business together, we made the decision to spend the money and the time and file as a LLC (Limited Liability Corporation). This way in case we get sued, our personal assets cannot be touched.

I haven’t bored you yet, have I? Good because in the next blog you need to decide what state to incorporate in, if you are going the LLC or the INC way. If you are a self-proprietary route, it’s the state you live in. Stay tuned.

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A Big Decision

Now that you’ve written your manuscript and polished it to an inch of its life, it’s time for you to make a big decision. Are you going to go the traditional route and try for an agent and traditional publisher or a small press or self publish? This topic is debated in depth by many, many other people so I won’t address it here. I will assume that since you are reading this blog that you have decided to go it by yourself.

The next question then remains, are you going to publish by yourself or start your own publishing business, if for no other reason than to publish only your manuscript. In this blog I’ll address the issue of publishing on your own without starting a business.

There are many ways to do this, even if you have no idea about the ins and outs of digital publishing, formatting for print books, marketing, tax advantages, etc. There are companies out there that will do all of that for you and all you have to do is upload your polished manuscript to them. They will send you a check every month for the sales. The down side is that they take more money to do all of it, including book cover, formatting digital formatting, etc.

If this is the way you intend to go, then there are a few places that I would recommend looking into. I’m not saying that they are the only companies out there that can do this or do it good but these are the ones that I’ve actually looked into myself and considered them in turn. The two big ones that I would trust would be CreateSpace and Smashwords.

CreateSpace is a subsidiary of Amazon.com. Of course this carries big name recognition. Amazon is arguably the biggest digital book seller in the world. This gives you access to all of Amazon’s markets, even those over seas. CreateSpace is also a POD (print on demand) printer. As someone buys a book, they print and ship it out for you. They make their money by taking a chunk, a large chunk, of the revenue. They even can help you with book covers. The down side is the cut they take.

Smashwords, in my opinion, is one of the best places too market to all different markets. They take your manuscript and digitally format it for all different ebook formats. On this site you can be placed in the iStore, Barnes & Noble, and many more. They are not a POD. However, they get that digital book out there to a large number of markets.

Ultimately it is your decision, and only your decision, what to do with your manuscript. If you are thinking of starting a publishing business to keep more control and more creativity over your manuscript, come back time and time again as I will be taking you step by step how we did it. Both the good and the bad. Stay tuned.

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New Adventures in Publishing

This blog is a new adventure for me. But so is the publishing company that I just opened with my good friend Jason Wilcox, also new to the publishing side of books. Join me on this adventure. I’ll be blogging about our adventures, missteps and triumphs in this first year. If you have any suggestions for this newbie, please, please comment. I need all the help I can get. I’m going to try to blog twice a week on Sundays and Thursday if my mundane job allows me the time. Occasionally Jason will guest post but mostly it will be me signing our praises, whining at our frustrations or ecstatically shouting our triumphs. Thanks for joining me.

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