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Attorneys of the Philippines Legal News

Welcome to our legal news pages. Here is where we provide updates about what's happening in Philippines legal news, and publish helpful articles and tips for Pinoys researching legal matters.

Some Key Points When Buying A Property In The Philippines

Purchasing a property can be risky if you are completely clueless about the process that comes with it. If you think handing the money to the developer or property owner entitles you of a piece of land, you may have to obtain additional information because these days, it is easy to be duped by people who are preying on innocent real estate buyers. Just because you are a first-time buyer does not necessarily mean you should allow yourself to fall victim to scams. When buying a property, you can talk directly to the owner or transact with a developer. Acquiring a land may not be a walk in the park for some, if the process is not clear. The first step that a buyer needs to secure when buying a property from individual owners is to ensure that the Certificate of Title is genuine. Anyone can be tricked into believing that a Certificate of Title is genuine, but when you are extra careful, you can save yourself from the trouble and inconvenience.

To check whether the Certificate of Title is genuine, you need to secure a certified true copy of the title from the Register of Deeds. Before you can secure a certified true copy of the Title, you need to request for the title’s photocopy from the seller. Unless discussed, you have to see to it that the title is clean or free from any transaction that can lead to a problem with acquiring the land in the future. Transactions on that transpire on the land are annotated as a rule of thumb. If there are no annotations on the page, then the title is clean.

You will also have to validate at the Register of Deeds if the land you are planning to buy coincides with the description on the Title. There are technical descriptions in the title and a surveyor can help you out in checking if the description matches. Yearly real estate taxes must also be paid and updated. Once a property is sold, the government will impose quarterly payment of taxes. The payment can be negotiated by the seller and buyer. Make sure the sellers are the owner of the property. You may request for the sellers’ valid IDs so you can check if it matches the name in the title. Always verify information in the original title. You may also validate with authority figures if the sellers are the true owners of the property. If you are going to buy a property, which is not a residential subdivision such as beach lot, or raw land, you need to check with the DENR to know about the regulated use of the land.

Essential Legal Procedures In Transfer Of Title:

•    Once the owner and buyer agree on sale of a property, a Deed of Absolute Sales (DOAS) will be created and notarized through a lawyer.

•    It is necessary to secure a Land Tax Declaration from the Bureau of Internal Revenue (BIR) and submit it to the city or municipal Assessor’s office.

•    The buyer will be the one to pay for the real estate tax to the City Treasurer’s Office.

•    The property’s market value will be assessed in the Assessor’s office.

•    The buyer pays the Transfer taxes to the Assessor’s office.

•    Documentary Stamp tax and Capital Gains tax will be paid to BIR.

•    The old title will be cancelled by the Registry of Deeds (RD) and the new one bearing the name of the buyer will be issued.

•    The buyer or the new owner obtains a photocopy of the new title and secures tax declaration from the Assessor’s office.

Free Yourself From The Shackles Of Credit Card Debt

Some people often say that credit cards are only intended for responsible adults who can handle finances properly. Without a doubt, credit cards offer convenience as you do not have to bring cash to pay for your purchases. However, this plastic money can show its sharp fangs and talons to those who are unable to make timely payments. Yes, it is a harmless card that provides you the privilege to make cashless payment, but you can be a slave to debt if you are not a responsible credit card holder. Some may think that the state of being indebted is a humiliating experience, but the truth is, it is a humbling experience as it teaches you one valuable lesson that can make you a better person if and only if you learn from it.

Credit card holders who are being harassed by collectors are a scenario that does not happen once in a super blue moon. There are lots of horror stories involving a credit card holder and a collection agency and if you do not know your rights as a cardholder, the experience can be debilitating. If you have received incessant calls demanding of a payment for your overdue credit card bills, take a deep breath and heave a sigh of relief as it is not the end of the world.

You do not have to make yourself suffer just because of a credit card debt. You can still become debt-free provided, you take full responsibility for mishandling your credit card finances. Some collectors may contact the credit card holder in the wee hours of the morning or late at night just to make the person pay the past due amount. Unless the cardholder has given permission to contact them during these times, calling the cardholder at inconvenient times is prohibited. This violation is under BSP Circular No. 702, Series of 2010.

Under Section 3 and 4 of the circular, the credit companies should do the following:

“1. notify the card holder in writing of the endorsement of the collection to an agency at least seven days before the actual endorsement;

2. give the defaulting credit card holder the name of the agent assigned to the account once they have endorsed the collection to a third-party;

3. change all disclosure documents and marketing materials so that they are printed in plain language and in bold black letters against a white background using the Arial font and a minimum 12 point font size. “

The consumer protection also indicates that a cardholder should also have the option to take advantage of various payment options. If the cardholder cannot pay the debt in full, other repayment plans should be available to them.

Credit card companies who fail to observe the procedures will receive the following sanctions:

“ First offense: Reprimand for the directors/officers responsible for the violation.

Second offense: Disqualification of the bank concerned from the credit facilities of the BSP except as may be allowed under Section 84 of R.A. No. 7653 (“New Central Bank Act”).

Subsequent offenses:

Prohibition on the bank concerned from the extension of additional credit accommodation against personal security; and
Penalties and sanctions under Sections 36 and 37 of RA 7653”

What Every Tenant And Landlord Should Know About Rental Contracts In The Philippines?

Have you ever been told not to sign a contract without taking time to read the terms and conditions? While every contract is created in good faith, there are instances when conditions are not something that every tenant can agree on. Landlords and tenants may have verbal agreements, but these can be reversed in a written contract. Before signing a contract, take time to read the fine print and getting a property lawyer to help you understand the terms and conditions will also be a wise move. A contract is essential for both short-term and long-term rentals. It binds agreements and protects both parties in the event the contract is breached.

Before a tenant can rent a residential property, landlords will require a deposit. This is often referred to as security deposits. In most cases, the rules for security deposits are almost similar in many countries. The tenant is required to pay a fixed amount, which will be used for repairing damages that the tenant incurs. However, the landlord will pay the deposit back if there is no damage to the property.  Unfortunately, there is no way to prove that a tenant has left the property damage-free unless pictures were taken. This is why tenants must make an effort to take pictures when moving in as a way of documenting any damage that is already present prior to occupying the property. You can present the proof once the landlord inspects the rental property.

Aside from deposits, another area of concern for tenants is the security of the rental property. While this can be pretty subjective especially when this is based on the location where the property is situated, a tenant always looks for a property that can ensure their safety. To reduce the chances of being robbed, it is necessary to check the security measures of your prospective rental location. More often than not, condos are equipped with security cameras to closely monitor day-to-day activities.

In the previous years, tenants are protected by Rent Control Act of 2009, but this act has already expired on December 31, 2015.  Reading and understanding the elements of contracts are the tenant's and landlord's line of defense.

Vital Elements Of A Rental Contract

•    Responsible parties. All tenants or lessees must be listed to ensure that all the adult individuals on the contract are jointly liable for breach of contract.

•    Payment and deposit. The contract must also indicate all monetary provisions including the rental amount and the security deposit. The frequency of payment and the acceptable modes of payment must be included.

•    Summary of fees. Other fees must be outlined and the parties responsible for each should also be indicated.

•    Rules, limitations, policies and disclaimers. As a landlord, policies on pets, sub-letting and allowing visitors should be clearly stated. This way, the lessees are not going to feign ignorance in case issues related to rental agreements arise.

What You Need To Know Before Investing In A Condominium Unit?

People belonging to the working class often consider investing in a piece of real estate such as a condominium unit because of its flexible payment schemes that make everyone’s dream of owning a real estate property a reality. As you flip through the pages of the developer’s brochures or magazines, you are left in awe as the units epitomize the kind of modern life you want to live.

The price range of these condo units vary from location to location and while these infrastructures make a great investment, there are condo unit owners who had their own share of not-so-pleasant experiences of buying a condo unit.

What can be worse than condos that do not have parking slots? Some owners have to buy a separate lot that can accommodate their vehicle and this means shelling out vast amounts of money. Developers often overlook this one essential space that makes living in a condo more comfortable and hassle-free. Condo unit owners are not only ranting about the lack of parking slots but lost deposits as well.

Buying a condominium unit can be very tedious as you need to go through all kinds of problems and dealing with the agent is no exception. Finding out about lost deposits can burst one’s bubbles. This is why, buyers make it a point to follow up on the agent or track their purchase. These are just a few issues associated with buying a condo unit let alone living in it.

Republic Act No. 4726 Or The Condominium Act Is One Of The Laws Related To Condominium Ownership:

“Sec. 2. A condominium is an interest in real property consisting of separate interest in a unit in a residential, industrial or commercial building and an undivided interest in common, directly or indirectly, in the land on which it is located and in other common areas of the building. A condominium may include, in addition, a separate interest in other portions of such real property. Title to the common areas, including the land, or the appurtenant interests in such areas, may be held by a corporation specially formed for the purpose (hereinafter known as the "condominium corporation") in which the holders of separate interest shall automatically be members or shareholders, to the exclusion of others, in proportion to the appurtenant interest of their respective units in the common areas.”

APEC: The Good, The Bad And The Ugly

This year, the Philippines hosted the Asia-Pacific Economic Cooperation (APEC) and while it aimed to foster camaraderie and unity among participating nations, it continues to torment Juan Dela Cruz as though a daily dose of traffic woes is not enough to show the worsening traffic situation in the country.  People has taken their litany of complaints to social media with hashtags #APECfail, #APECtado, #APECtraffic and you do not need a regular update of the traffic situation because the status updates you get in rapid succession are enough to describe the horrifying truth that Leaders are so desperate to hide. 

It was a week filled with pretense as the government leaders tried to put their best foot forward. It only takes a week to hide the vicious cycle and the harsh truth,  that is poverty. It continues to plague the country, but in just a matter of weeks, the homeless families were taken off the streets of Metro Manila. They were provided with a dingy shelter to roost in so the city will look “pleasing” to the eyes of foreign visitors. 

This goes to show that everyone in the government office has an active participation in the preparation for APEC meeting from November 17 to 20 and with that said, the government claimed they have not ordered flight cancellations as it was the ‘call of the airlines’. According to Quezon City Representative Winston Castelo, flight cancellations can be detrimental to the economy. Acting Metro Manila Authority head Emerson Carlos said that measures will be put in place to ensure that major roads are passable for APEC delegates. From a bird’s eye view, you can clearly see the huge difference between the roads intended for APEC delegates and the roads for the locals. 

November 18 and 19 has also been declared special non-working days and the following pay rules are observed upon issuing Labor Advisory No. 14 of 2015 by Labor and Employment Secretary Rosalinda Dimapilis-Baldoz.

“If the employee did not work:

He/she will not be paid, unless there is a favourable company policy, practice, or collective bargaining agreement (CBA) grantingpayment of wages on 17-20 November; and

When the employee has accrued leave credits, he/she may be allowed to utilize such leave so that he/she will have compensation on said days.

If the employee worked:

No additional pay is given to the employee, but only their salary on said day.”

“The following pay rules shall apply for private sector workers in NCR from 18 to 19 November 2015:

If the employee did not work, the “no-work, no-pay” principle shall apply, unless there is a favorable company policy, practice, or collective bargaining agreement (CBA) granting payment on a special day;

If the employee worked, he or she shall be paid an additional 30 percent of his or her daily rate on the first eight hours of work [(daily rate x 130 percent) + COLA];

If the employee worked in excess of 8 hours (overtime work), he or she shall be paid an additional 30 percent of his or her hourly rate on said day (hourly rate of the basic daily wage x 130 percent x 130 percent x number of hours worked);

If the employee worked during a special day that also falls on his or her rest day, he or she shall be paid an additional 50 percent of his or her daily rate on the first 8 hours of work [(daily rate x 150 percent) + COLA];

If the employee worked in excess of 8 hours (overtime work) during a special day that also falls on his or her rest day, he or she shall be paid an additional 30 percent of his or her hourly rate on said day (hourly rate of the basic daily wage x 150 percent x 130 percent x number of hours worked).”

Bureau Of Customs And The Tighter Rules Being Imposed On Balikbayan Boxes

For Pinoys who have family members or relatives abroad, balikbayan boxes make up for the absence of the person working abroad. It takes months before the boxes can be filled with the family member’s favorite things. Without a doubt, the balikbayan boxes are a tangible sign of the Overseas Filipino Workers’ love for the family members. With the most recent announcement on the stricter rules and regulations imposed by Bureau of Customs, OFWs and their families could not help but go ballistic on the revised rules.

The BOC’s rules and regulations subject balikbayan boxes to 100% physical examination. However, not all balikbayan boxes will be placed under alert. The boxes that have been deemed to have violated the law on importing articles will be brought to the authorized area for examination or inspection. 

Under Section 105 of the Tariff and Customs Code of the Philippines (TCCP), the following items cannot be brought into the Philippines:

• Coffee

• Used clothing and rags

• Toy guns

• Onions, potatoes, cabbages, garlic

The following commodities are prohibited to be brought into the Philippines:

• Marijuana, opium or any type of synthetic drugs or narcotics;

• Roulette wheels, loaded dice, marked cards, gambling outfits, apparatus, machines or mechanical devices used in gambling;

• Opium pipes;

• Tickets for lottery and sweepstakes except those authorized by the Philippines government, advertisement thereof, and list of drawings therein;

• Dynamite, ammunition, gunpowder and other explosives such as fire-arms and weapons of war, and parts thereof, except when they are authorised by law;

• Articles, drugs, instruments, substances designed, intended or adapted for producing unlawful abortion, or any printed matter which describes or advertises or gives directly or indirectly information regarding where, how or by whom unlawful abortion produced;

• Written or printed articles in any form containing any matter advocating or inciting treason, or rebellion, insurrection, sedition or subversion against the government of the Philippines, or forcible resistance to any law of the Philippines;

• Written or printed articles, negatives or cinematographic film, photographs, engravings, lithographs, paintings, objects, drawings or other representation of an obscene or immoral character;

• All other articles or part thereof, the importation of which is prohibited by law or rules and regulation issued by competent authority.

The physical examination of balikbayan boxes are in accordance with Section 3604 of the TCCP. The revised rules and regulations are also said to put a lid on violations made by individuals who use balikbayan boxes to break the law such as bringing thousands of anti-anxiety drugs, misdeclared as food supplements into the Philippines. 

All boxes are expected to undergo mandatory x-ray and K-9 examination at no cost to the person who sent it. Once there are derogatory findings, the physical inspection of goods will be considered. 

Can You Be Imprisoned For Non-Payment Of Debt?

Have you been screening your phone calls to avoid collectors who are constantly nagging you to settle your unpaid credit card balance? Have you been threatened to face a lawsuit if you fail to repay a lender? If incessant calls from creditors caused you to be allergic to phone calls, being armed with the basic principles of the consequences for non-payment of debt can give you greater peace of mind. In fact, it can be a whiff of fresh air if you heard the statement that no one will end up in jail for non-payment of debt. 

Before you allow paranoia to feast on you, know more about the laws associated with unsettled debt.

Some common laws that are said to violate the constitutional prohibition against non-imprisonment of debt:

Credit Cards

The Access Devices Regulation Act of 1998 (RA. 8484) states that any person who obtains the money or anything that is valuable with the use of an access device with the sole intent to defraud or with intent to gain and fleeing once motive has been executed will be held liable for a crime punishable with a fine and imprisonment. In addition, a cardholder who intentionally abandons the residence, place of employment or business that was declared on the application or credit card without informing the credit card company of the current place where he could be reached will also be liable for a crime. If during the abandonment, the person has outstanding and unpaid balance which is past due for at least 90 days and is more than P10,000.00, the individual shall be prima facie presumed to have used his access device or credit card with intent to defraud.

Bouncing Checks 

Bouncing Checks Law (BP22) has also been viewed as a violation of constitutional prohibition against non-imprisonment for debt. In the context of this law, the non-payment of an obligation is not its main concern. The law is not designed to force a debtor to settle his debt. The main purpose of the law is to prevent anyone with the gumption to make checks that don’t have any value with the intention of putting them in circulation. Checks have become a substitute for cash and widely accepted as a medium of payment especially in trade and commerce and when the confidence of using these checks are marred due to its misuse, its value and usefulness will also be diminished. 

Trust Receipts

Trust receipts and bouncing checks share the same argument based on the Trust Receipts Law (PD 115), which states, if a person fails to turn over the proceeds of the sale of goods which are considered covered by a trust receipt or if the person fails to return said goods if they have not been sold, penal sanctions shall be imposed. The punishment is due to the abuse of confidence and dishonesty in the handling of goods or money.

Get To Know The Types Of Taxes When Doing Business In The Philippines

Being familiar with business tax in the Philippines is an important part of starting a business. You don’t necessarily have to be an expert, but you need to gain some basic knowledge about the tax so mistakes in tax payment can be prevented. Some business owners leave this matter to their accountant or bookkeeper but when problems arise, they are the ones who are liable. Once you are aware of the business taxes in the Philippines, you are taking a great step to avoiding tax violations. 

Two kinds of taxes:

1. National Taxes – This type of tax refers to the tax you pay to the government. The tax is remitted to the Bureau of Internal Revenue (BIR). Some examples of national taxes are Value Added Tax (VAT), income tax, percentage tax, excise tax, capital gains tax and many others. 

2. Local Taxes – These are taxes that you pay through the local government units (LGU). These government units include cities, barangays, municipalities and provinces. Examples of local taxes include community tax, professional tax, amusement tax and other taxes that fall under the local taxes category. 

Business Taxes 

• Value Added Tax (VAT) - This type of business tax is considered an indirect tax. This is the reason it can be passed on to the buyer, lessee or transferee. This is collected from the seller when properties or goods are sold. Whether it is trade or business, Value Added Tax will be imposed. The amount you are going to pay will be based on the value you added to the product cost. Whether or not you earn net profit, you are still required to pay value added tax. However, when projected sales are deemed lower than required, the company is already considered exempted from paying the tax. 

• Excise Tax – This type of business tax is in additional to the value-added tax. This will be imposed for goods that are produced in the Philippines. Excise taxes are applied when these goods are intended for consumption or domestic sales. 

• Percentage Tax – When gross annual receipts and sales do not exceed the required amount, the percentage tax will be imposed on entities or individuals. Persons and entities are required to file percentage tax return not later than the 20th days following the end of each month. When a person subject to percentage taxes decides to retire from a business, the Revenue District Office must be notified within 20 days after the business closes.

Tips For Legally Doing Business In The Philippines

Entrepreneurs who want to legally do business in the Philippines should start with exploring some viable options. A businessman just cannot jump into a business without familiarizing its technicalities. There are some things you need to take into consideration before you can operate your business. 

You need to start with knowing the types of business ownership under the Philippine law: 

1. Corporation 

This type of business structure has five owners or more and they are referred to as shareholders. There are two types of corporation: stock corporation and non-stock corporation. With stock corporation, the capital is divided into shares and distributed to the investors. In turn, investors receive allotments and dividends, which will be based on the numbers of shares they have within the corporation. 

A non-stock corporation is intended for public purposes and issuing shares of stock is already out of the picture. This corporation’s purpose is usually cultural, educational and charitable. 

2. Partnership 

There are two or more individuals involved in this type of business structure. This is why they are called partners according to the Civil Code of the Philippines. The partnership can either be a general partnership or a limited partnership. Partners in a general partnership only have a limited liability for the financial obligations while a limited partnership requires one person to have unlimited liability while the rest have liabilities based on their capital contribution amount. 

3. Sole Proprietorship

As the name implies, this business structure is fully controlled and owned by an individual, which will also enjoy the profits and handle the liabilities of the business. For a sole proprietorship to be in effect, the owner must apply for a business name. It is also the proprietor’s obligation to register with the Department of Trade and Industry (DTI). 

Important Things To Consider For The Business To Run Smoothly: 

Your business cannot be considered legal without registering it with the Bureau of Internal Revenue. Make sure you register your business to the Revenue District Office (RDO) where your business is located. You will also need to secure a Certificate of Registration (COR) and Authority to Print (ATP) for your official receipts to be printed. You should also keep in mind that only printers accredited by BIR will be acknowledged. The official receipts should show that it is BIR accredited. Even books of account must bear BIR stamp. 

Aside from BIR, you should also register your business and employees with the Social Security System (SSS), Home Development Mutual Fund (Pag-ibig) and Philippine Health Insurance (Philhealth). These government entities will also require you to submit reports. It is imperative that you register newly-hired employees with these government agencies as well. 

Why Documenting Oral Advice Is Important?

These days, cases are filed due to the negligence of documenting oral advice and while majority of clients may still give little importance to this, its effect can create a serious damage to the business. This is why it is every business owner’s responsibility to document oral advice especially if it involves information that is beneficial to the company. Lawyers will consider the defense weak if no strong evidence is presented. When documenting oral advice, some key items or essential details must be present. Documentation that lacks essential information can be compared to an undocumented oral advice. The documents’ principal rule: if it’s not there, it did not happen. 

All You Need To Know About Documenting Oral Advice

There are sensitive issues concerning your business that require advice from experts and it does carry weight especially if you are going to use this in defense for any claims. The documentation is more than enough to strengthen any claim and it serves as a way to validate any agreement or discussion that took place. It is also necessary that you include some essential details such as the date of the discussion, the names of participants, the facts that have been provided, and any considerations that the advisor may have given, notice that proves there was no legal advice provided and the items that show recommendations and other additional actions that have to be taken. 

Business operations will also receive unsolicited advice especially regarding the approaches that must be used for the betterment of client operation. While these are considered useful and something that the client can benefit from, it is necessary that the advice must be documented following a specific format. 

The discussion is documented with the use of firm working papers, but this should also include some essential information such as the recommendations and the name of the people involved in the discussion including the a third party if present. These documents need to be written in vivid details because if there are any allegations, the documentation will be instrumental for the resolution. 

Giving oral advice may seem like a very simple way to provide suggestions but it can have a deleterious effect if this is not taken seriously. For matters that can create a huge impact on your business, a document should be kept in mind. Documentation is not just about an issue of trust but a matter of clarifying things especially when you need to use the advice for your future endeavors. It can save you a costly trip to the court as you defend yourself against allegations. 

Why You Should Use an Attorney to Prepare Your Will

There is no substitute for legal advice from an attorney especially when it comes to preparing a will. In fact, a will must not be taken lightly as it is a serious matter. Attempting to write a will on your own is going to be risky and may even result in committing costly mistakes. While you might be vacillating on whether to get an attorney to complete your will or do it yourself, these following reasons might just enlighten you on the importance of an attorney: 

Specific Terms Are Used To Avoid Confusion

Vague terms can wreak havoc on completing your will and you might run the risk of being misinterpreted. The attorney uses a standard language for everyone to understand the content of your will. With the standard language, confusions are prevented and the message is conveyed to your beneficiaries and will executors. 

Error-Free

Homemade wills are less likely to be free of errors because it does not undergo the same scrutiny and examination that it gets when it is done by attorneys. Let’s face it, there are some technicalities involved in completing a will and attorneys are detail-oriented. They know the process of preparing a will, but if you are going to make your own will without seeking help from professionals, you might commit errors that are often difficult to undo. Some of the major errors that you may commit include forgetting to keep your will updated, forgetting to include your sign in the will, adding amendments and many others. 

The Will Is Based On Solid Facts 

Attorneys have undergone extensive training to familiarize themselves with the law’s intricacy. Imagine the time and effort they invested to acquire their title. If you are going to write your own will based on assumptions, there might be some areas that remain unclear to you. There will be questions lingering in your mind and they will remain unanswered unless you decide to get help. Contingencies are covered by an attorney that specializes in will preparation. There will be no confusions and your questions are answered point blank. 

Familiarity With Inheritance Tax and Law

Inheritance law is essential when preparing a will. Since it is governed by Civil Code, everything must be accurate and concise. An attorney can provide the right solutions to various inheritance issues that DIY will preparation may have possibly missed. 

Essentials For Preparing A Will

• It must be properly executed.

The will should include a date and place of signing. There should be witnesses in your presence before signing could take place. 

• The testator must be of legal age.

A testator must be at least eighteen years of age to be considered qualified for preparing a will. 

• The testator must have a sound mind.

It is also important that you are fully aware you are making a will. You should know the names of beneficiaries or descendants. 

• The will must be properly signed.

An unsigned will is considered invalid. With that being said, it is required that you voluntarily sign your will. Alternative provisions will be made if there are some unlikely circumstances that deterred a testator to sign the will such as illness or illiteracy.  

• There must be a clear intention to transfer the property. 

A statement with your intention to transfer the property to specific persons must also be prepared. 

5 Helpful Tips When Setting Up Your Business

It is a brave move for anyone to decide on starting a business and giving up a job routine they have been accustomed to for years. While being your own boss is such a dream come true, there is more to running a business than meets the eye. Before you consider taking that huge leap, arm yourself with knowledge about business principles. Otherwise, you will be doomed to fail.

No one can really predict whether a business is viable or not because it solely depends on how you manage it. If you do not have any business background, you may feel as though a business is a total alien landscape. Everything seems foreign to you and it is like going to a battle unarmed. While establishing a path may seem very challenging, learning the business principles will lead you to the road of success.

Create A Feasibility Study

The most common mistake that people make is investing their hard earned money into a business they are not even familiar with. This is the kind of risk that is the hardest to take because if things don’t go as planned, you have to start from scratch and this means spending vast amounts of money. In a feasibility study, you will cover the following areas: products and services, target market, suppliers, competitions, pricing and marketing techniques. With all these in mind, you are slowly putting things in their proper perspectives. The main purpose of creating a feasibility study is for you to determine the nature of business that suits your skills. You can also learn more about your target audience or potential customers’ needs and wants with feasibility study. If you already have a competition before you start your own business, you have an idea how you can stay ahead of the game.

Formulate A Business Plan

Once you have identified viable products and services, the next step is to create a business plan. If you do not have a strong background in business management, find someone who can help you with drafting the plan. The business plan should include essential information on the nature of your business. Aside from the summary of the product, readers must also obtain details of your product. A business proposal must also be kept in mind and each section must outline the strategies you have developed for your business. Don’t forget to include your competition and budget in your business plan as well. Your projections must be realistic and it should the cost of the product, projected sales and even the financial requirements.

Analyze The Availability Of Cash Flow

A steady cash flow is going to be necessary if you want your business to be smooth-sailing. However, when cash flow becomes unavailable, there are still other financial institutions that will provide you assistance in fulfilling your business needs. You just have to see to it you have a sound financial projection or your objective of making a profit will be defeated. Prepare a financial report so you can keep track of your finances. Hire accounting or bookkeeping professionals for this task so you can keep your budget in check. Major business losses are usually due to financial mismanagement and if you want to increase sales and make your business more profitable, you should always keep a record of your financial activity.

Seek All The Help You Can Get

Some entrepreneurial hopefuls end up bursting their tiny bubble due to the lack of business knowledge. You may have the funding and a viable product to set up a business but do you really have what it takes to increase your chances for success? Investing your money in a business is a game of survival and those who manage to keep up with the competition win. Get expert advice so you will know how you can make your business more profitable.

Secure All The Necessary Permits

As an entrepreneur, it is your obligation to follow business rules which include securing a business permit. There are several steps involved in getting a business permit and you are not allowed to operate your business if these have not been secured. For this process, prepare all the essential documents such as notarized documents, certificate of deposit, clearance, receipts and other requirements you need for your business permit.



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