Tips for starting your own business - home study course from the American Institute of Small Business; cost-effective recycling; CEO compensation

Nation's Business, Nov, 1984

Tired of working for a large corporation? Want to be your own boss but don't know how to go about switching to a solo career?

A new home study course from the American Institute of Small Business may help you get started.

"How To Set Uo Your Own Small Business" includes tips on these subjects: where to locate your business, market research, how to finance your business, sales forecasting and budgeting, purchasing and finding supply sources, advertising and public relations, insurance needs, how to sell, legal needs--including the types of organizational structure--and basic bookkeeping.

The course covers a variety of information for a person planning to operate a business out of the home or in a more structured office setting. It is suitable for those individuals entering the business world full time or part time. The course is applicable to entrepreneurs starting from scratch as well as those purchasing an existing business.

Max Fallek, the institute's president, notes that the course "takes most of the risk out of setting up a small business." He says it has been designed to eliminate the main reason people fail in business--a lack of managerial and business knowledge and experience--"by using simple, concise language anyone can follow."

The course costs $295. For more information, contact the American Institute of Small Business, 9851 13th Avenue North, Minneapolis, Minn. 55441. Phone: (612) 545-1984. Cost-Effective Recycling

Although Congress has passed a law stipulating that businesses generating as little as 100 kilograms (27 gallons) of hazardous wastte a month must now keep extensive records and manifests tracking their wastes, the outcome could have been worse. Original legislation had included businesses producing as little as 25 kilograms monthly.

The Environmental Protection Agency and business groups like the U.S. Chamber of Commerce plan an educational blitz for newcomers on the hazardous waste issue. And businesses will be able to choose from Several waste management options.

One popular method is landfill disposal. However, the measure would prohibit the dumping of organics and solvents--products that are used almost universally by large and small businesses.

Other choices include deep wells; high temperature incineration; chemical, physical or biological degradation; land farming, which is the injection of wastes near the surface of the land, and recycling.

Businesses that select recycling could reap several benefits, according to David J. Schoonmaker, vice president and general manager of McKesson Envirosystems Company, which recyles solvents and recovers organic compounds.

* Recyclers would be responsible for keeping records. Small waste generators would be relieved of long-term liability and worry about improper handling or abandoned sites.

* Petroleum-based high-cost solvents could be cleaned up and re-used.

* Byproducts of recycling could be sold to new markets. An example: an FDA approved solvent that has been used in kidney dialysis machines and that, with minimal reprocessing, can be used in manufacturing paints and coatings.

* Contamination extracted from hazardous wastes can be blended with other solvents and used as chemical fuel for blast furnaces and cement kilns.

In the end, nothing would have to go to landfills.

Some industries that have already taked advantage of recycling include paint and coating firms, and electronics and pharmaceutical companies. CEO Compensation

If you head a small or medium-sized company and are curious about the compensation packages of your peers, a study by Peat, Marwick, Mitchell & Company may interest you. The international accounting firm surveyed 1,016 firms with sales ranging from about $500,000 to $25 million. The average chief executive officer surveyed is 45, oversees a company with pretax earnings of $308,500 on revenues of $4.5 million and takes home $71,797 in base salary and extras.

Equity ownership figures prominently in executive incentives and compensation in these companies, the study found. Typically, a CEO owns 59 percent equity in the firm, followed by the chief operating officer with 13 percent and the chief financial officer with 10 percent.

Instead of devising compensation strategies, 72 percent of the surveyed companies have adhered to granting discretionary salary increases and bonuses. But "across-the-board salary increases and discretionary bonuses are slowly giving way to a number of bonus formulas and incentive structures," notes Peter T. Chingos, a principal in Peat Marwick's compensation practice group.

Supplemental medical benefits are offered to CEOs by 47 percent of the companies; 64 percent offer supplemental life insurance, and 18 percent offer supplemental retirement benefits. Tax and financial planning are provided by 29 percent.