Additional funding and investments
I need to invest in a new machine/device, but where do I get the money for it?
- Banks and Finnvera (bank guarantee and/or loan)
- Investment grant and consultancy assistance from ELY Centre or a local action group (e.g. Aktion Österbotten, Leader Yhyres) for establishing the price-quality ratio
Cash flow and crisis
Why does liquidity vary? Why don’t I have any money? Is the monitoring inadequate?
- Seasonal operations – monitor the monthly sales
- Periods of payment for customers are too long – ask for an advance and/or shorten the periods of payment
- Extend your payment periods when purchasing something
- Do you have too much money tied up in stock? Set a target for turnover, set a maximum target in euros
- Remember to discuss payment matters with your financiers early enough
- If necessary, e.g. a loan and a checking account with an overdraft facility may be helpful
- Remember to invite suppliers to tender on a regular basis
Analyzing results, balance and profitability of the operations
Hard work but no results. What’s the matter?
- It would help if you learned the key figures – research them together with your accountant
- Monthly monitoring, expense control
- Compare your numbers with the average numbers in the field. For example, Finnvera and ELY Centre’s statistics can be found at the website Toimiala Online
- Compare your pricing with your competitors’ pricing – do they follow the same principles?
Changing the company type
When is the right time to switch from sole proprietorship (SP) to a limited company?
- Rule of thumb: when your tax per cent exceeds 30
- The company changes ownership
- Risk management perspective
- At a financier’s request
- When you have enough balance to pay dividends on top of salaries
- When you want to transfer income from taxation of earned income to capital income taxation, for example, when receiving pension income in addition to entrepreneurial income
Marketing and sales
My products and services are OK, but where are the clients?
- Draw up a marketing plan for at least the next six months
- Would a sales campaign be a possibility?
- Utilize your social network
- Increase the number of your personal contacts
- Take better advantage of industry experts
- Utilize digital marketing and social media actively
- Gather customer feedback and use it when developing your marketing: how did the customer find you?
- Do you see marketing as an expense or as an investment? In Europe, companies use on average 4% of their turnover for marketing
Matters regarding facilities
Matters regarding facilities
- Is the location of the facilities ideal in terms of the business idea? Pay attention to the customer’s perspective, competitor’s locations, easy accessibility, parking lot, visibility
- Find out any upcoming repairs and renovations/changes within the facilities as well as roadwork or similar nearby – they might affect your business radically. The property manager, owner of the facilities, the city, and municipal engineering services will help you
- Ownership or renting? Draw up calculations
- Are product placement and checkout counter placement in the business premises optimal?
- Functionality of logistics
Funding product and other development
How do I fund product development?
- You can get a 50% grant from ELY Centre for purchasing expert services. Familiarize yourself with the productized expert services ELY Centre offers
- Foundation for Finnish Inventions funds innovation research
- Utilize the services of an invention advisor, e.g. product path
- A company located in the countryside can apply for a startup grant or a grant for experimentation from ELY Centre or a local action group (Aktion Österbotten, Leader Yhyres)
- Funding possibilities, e.g. innovation voucher
Matters regarding change of ownership
Where do I get help with selling, buying, and determining value?
- VASEKs experts: Boosting the change of ownerships services i.e. the OSV project
- Experts in company acquisitions & accountancy companies
- Yrityspörssi (lit. business stock exchange)
- It is possible to use a grant to purchase subsidized expert advice via ELY Centre’s business development services
Personnel matters
How much should the turnover increase so that I can hire an employee?
- When hiring your first employee as a sole entrepreneur, the rule of thumb that can be followed is a 2,3 x turnover. This number also includes other expenses since the costs will increase in different ways on top of the salary.
How much do I need to pay the employee, indirect expenses included? What’s the minimum wage?
- E.g. online salary calculators
- Read more about collective agreements
Can I get a grant for hiring my first employee?
- ELY Centre, TE Services and apprenticeship offices have different kinds of grant possibilities
How to draw a contract of employment and periods of notice?
- Always draft a written employment contract (including probation or trial period) and add a clause regarding the prohibition of competition
- With a collective agreement or a contract of employment, it’s possible to agree on different terms regarding periods of notice than those written down in the law. According to the contracts of employment acts, the general periods of notice are the following: when the employment has continued for a maximum of 1 year = 14 days, over 1 year but a maximum of 4 years = 1 month, over 4 years but a maximum of 8 years = 2 months, over 8 years but a maximum of 12 years = 4 months, over 12 years = 6 months
- The periods of notice that the employee must follow: when the employment has continued for a maximum of 5 years = 14 days, over 5 years = 1 month
Webshop
What do I need to consider when I’m setting up a webshop?
- Bear in mind that maintaining a webshop requires planning as any other business. Familiarize yourself with all aspects, e.g. with all material that can be found online
- Compare the price-quality ratios of different suppliers and take all life-cycle costs into account
- Do you really have the time/interest/know-how to maintain a webshop?
- Most webshops go out of business because they have become unprofitable, read: neglected. Contrary to popular belief, a web shop does not work without active operations, even if the shop is open 24/7 online
- In terms of the product’s price, quality, and “form”, is it profitable to sell the product online considering postal expenses, product range, and competitive situation, etc.?
- Good online business does not often require a wide product range (actually, on the contrary. Usually, it is the most effective to specialize in something)
- Who implements the shop and before anything, who is supposed to maintain it?
- In most cases, it’s reasonable to let a professional implement the shop. Maintaining the shop (adding products, marketing, etc.), however, is usually practical to handle yourself in terms of flexibility and profitability
- What’s my market area? Would it be profitable to serve customers e.g. inside the EU or the whole world? 5 million vs. 100 million customers. In the end, it’s not that expensive to add different language versions to the program
Matters related to export and import
Who do I need to contact when I’m planning to export?
- Viexpo, Business Finland and a local chamber of commerce, remember the bank as well when planning the payment terms
- Find out if you have a possibility for support from Business Finland
Where do I get information about import matters?
- VAT matters from tax authorities and the customs, in matters related to food products, contact the local health inspector
- Forwarding agencies help you with almost anything related to import
- VASEKs international services
Contract matters
How do I make a good contract?
- Utilize expert help, a lawyer/consultant. In more complicated matters, always try to make a written contract
- In the construction trade, always make a contract with the client in order to establish the responsibility matters
- At least the price, delivery time, including obligations and responsibilities, termination and payment terms should be included in the contract
Closing down
How do I close down my business?
- Make a notice of termination of business: Y6 if it’s a proprietorship, Y5 if it’s a partnership firm or a limited partnership, and Y4 if it’s a limited company or a cooperative. Make the notice here.
- Contact your own insurance company, bank, accounting firm, tax authorities and the financier. When applying for unemployment benefits, contact the union and/or TE services
- Consider if you can sell your business, a part of it or some parts of the fixed assets
Training
Where can I get training?
- Utilize training projects, contact local educational institutes, e.g. adult education centres
- TE services, entrepreneur organizations, chamber of commerce, private operators, ELY Centres and apprenticeship training offices, etc.
VAT and taxes
How can I request a VAT refund in foreign trade? VAT refunds, when can I apply for them?
- Take a look at the tax authority’s website
What about periodic tax returns?
- Take a look at the tax authority's website
Why do I need to pay residual taxes?
- The estimated advances were too small, or you haven’t given estimates at all. Remember to check your taxes on time
- Have you cancelled reservations or sold your property? If so, the tax effect can easily be left unnoticed
- If you’re a part-time entrepreneur, bear in mind that the tax percent is determined by overall results (partnerships)
What are advance taxes based on? How do I change them?
- In the first and second year, the advances are based on the income you have estimated. In the future, it will be raised with an index according to your latest tax decision (which means how much taxable income did you gain in the accounting period in the year before the last)
How to protect my ideas
How do I get a patent or design protection for my product/idea?
- Utilize the invention foundation’s projects in patent and protection matters. You can get advice and have a novelty value investigation made.
- The private operators in the field give advice
- Guides and advice for protecting
Launching a new product/service and distribution channels
How do I get the best visibility for my product/service?
- Determine your customer group as accurately as possible so that you can choose the best methods for your marketing
- Social media and your own web page
- Print media, direct advertising and newspaper advertisements
- Personal sales and marketing, utilize your own network
- Inform your most important partners and customer groups
- Remember to inform your old clients, update and utilize your customer register
- Write an announcement, try to get a journalist to write an article about it
- Try to get support from your partners for sales, advertising and visibility, e.g. launching campaign prices?
Kilometre allowance
I am a sole proprietor – can I pay kilometre allowance to myself?
- Keep a driving diary – the practices vary case-by-case. It depends on the field of business, using the car to one’s own errands, etc., so it’s wise to ask at a local tax office
Can I charge the kilometres from my customer, if I’m a sole proprietor?
- Yes you can, but it’s taxable income, so remember to add VAT to the travel expenses as well (e.g. 0,42€ + VAT 24%)
License matters
Where can I find information on necessary licenses?
- Good advice and information can be found on the website Suomi.fi
Stock management
What’s the right size for a stock? What do I need it for?
- Set a goal for stock turnover and value and monitor it
- Find out the average turnover for the field
- Monitor the supplier’s payment periods, tender
- Monitor the product loss
- Be critical when purchasing and don’t only look at the extra discount percentage
- Remember to set low product alarms so that you know when to order more
Franchising
Should I join a franchising chain?
- Consult an expert when going through the contract proposal, ask other franchisees of similar size operating in the chain