There must be a difference in what the successful do versus those failing. So what’s the difference between those who succeed and those who fail? Does it surprise you to learn that it’s not luck, skill, connections, or even perseverance. It’s a very simple secret that, once you figure it out, will virtually ensure your success.

Treat your Business like a Business

As hard as it might be to believe, the secret lies in treating your business like a business. If you treat it as a hobby then that’s where many would-be business owners will fail. If you put casual effort into it then failure is very likely to happen.

If you’re online and you make money or even just want to, then you’re in business. It doesn’t matter if you earn money by creating and selling your own products, through pay-per-click ads on your website, promote products and services as an affiliate, or any other way, you are still running a business. Treating it as a business will help to insure you reach your financial and lifestyle goals. If you make the mistake of thinking “I’m just blogging” or I’m putting up my website and the traffic will come, things won’t work out for you. If you let that harming and defeating belief get in the way of building a real business, then you will be able to count yourself as one of those failures.

It’s not complicated setting up an online business. It’s more often than not about your mindset than legal or physical concerns, although you will probably have some of those concerns as well. The first step is simply to acknowledge the fact that you are in business – and to start treating your work in a businesslike manner.

Don’t Shortchange Yourself

If you keep somewhat regular business hours, for example, that is a good way to get your new business off the ground on the right foot. If you make a habit of going out for long lunches or spending the afternoon shopping or doing other non-business activities, well your business will quickly begin to suffer.

Instead of wasting time on other non-business matters, make a commitment to yourself, your family, and your business to work a certain number of hours each day. You’d do that if you were working for someone else so why not make it a habit to do the same for yourself. The hours you choose to work might be more flexible than if you had a job, but you do still need to put in the time and do the work. Putting in the time and not doing the work won’t work either so don’t go that route.

Business Owner Legal Responsibilities

Establishing a legal business entity is just as important as acting like a true business owner. This might mean simply applying for an EIN (employer identification number) and a DBA (doing business as) as a sole proprietor. In a different situation it could mean applying for and becoming an LLC (Limited Liability Company).

Alternatively, it could involve setting up a corporation with shareholders and stock options. But that’s probably not the first type of business you want to start unless there is a pressing reason for it. It’s more difficult, costly, and more legalities that a corporation has to follow.

The legal structure itself is not as important as the actual act of creating a business – not only for legal reasons, but to help you create a business mindset as well. The mindset is very important and not something to be taken lightly. Without a business mindset you are setting yourself up for failure.

Taxes never go away

Regardless of where you live or what country you live in, taxes are something no one likes to think about. However, understanding the tax ramifications of being in business is critical to your financial health. You should always consult with an attorney and/or an accountant to determine the best business structure for you. This will determine how and when you pay taxes. It might also determine how much taxes you pay, whether directly or indirectly.

As a sole proprietor or LLC, for example, you may be required to pay quarterly estimated taxes. If you operate as a corporation, you will have to establish a payroll (even if you are the only employee) and pay taxes accordingly. In the United States this usually means you’ll have to contribute to some employee taxes if you have employees and file other paperwork required of corporations.

Operating from Home

If you intend to work from home, you should also check with your local municipality to make sure you are legally allowed to have a place of business in your home. Some counties restrict business activities in residential neighborhoods, but in most cases, unless you have clients visiting your office frequently, you shouldn’t have a problem.

Still, it’s worth asking about before establishing your business. In some cities here in California they will not let you have a business in your home. It seems unfair, but unfortunately many cities don’t seem to have the best interest of their residents in mind. In other cases, like mine where I live just outside the city limits that city tried to make me pay a business tax which I promptly ignored. I am out of their jurisdiction.

Consider Insurance

Something you should consider is getting insurance to protect your personal and business assets. This is especially important if you operate a freelance business, but bloggers, affiliate marketers, and information product creators should also consider it. Such insurance is not necessarily a waste – and is valuable as protection from law suits as well as for other purposes. For example suppose someone breaks into your home office or business office elsewhere and steals your computers and printers or other costly equipment. Such insurance can be worthwhile and save you money in such cases. Also you might consider what might happen to your income if you cannot work. If you cannot do it on your own a lawyer will be able to help you figure out which type of insurance you may need, and in what amount.

Treat online activities as a real business

Many people start an online business because they think it’s going to be easy and less structured than a typical “brick and mortar” business. Another big reason people want to start an online business is the cost of starting such a business is usually considerably less than the typical business.

While both are true in many aspects, you still need to operate your online venture as a real business if you hope to create a sustainable income for yourself and your family. Don’t be fooled by the lower cost of entry and the freedom of not reporting to someone else. Treat your online activities as a real business and you are off to a great start and potentially exciting profits.

Copyright © Charles Harmon

Google’s Matt Cutts gives tips to small business owners

Published on Youtube Dec 6, 2007

Note: although the video is old, the tips are still valid.

Rodney Bartlett interviews Google’s Matt Cutts at Pubcon 2007 in Las Vegas. Matt had some excellent tips for small business owners and answered a few great questions.

Qualities of a good site

Published on Youtube Apr 25, 2011

Matt Cutts answers Google questions:
– Does Sitemaps depend on pageviews?
– What are the top things to do in SEO?
– How does Google decide to use a DMOZ snippet versus the description from a meta tag?
– Should I use bold or strong tags?