Business Plan – Essential Elements-3.A.

Essential Elements of an Affiliate
Marketing Business Plan – 3.A.

There are four essential elements for an Affiliate Marketing Business Plan. They are:

  • Goals & Objectives
  • Market Research & Analysis
  • Financial & Legal Documentation
  • Promotion & Marketing

This post will deal with item number three; Financial & Legal Documentation

Financial

As with any business, you are going to have start up and monthly recurring costs for an Affiliate Marketing business. You should keep track of these costs for tax purposes. You may want to set up a spreadsheet with the following columns:

  • Website Creation (includes logo creation)
  • Hosting Fees
  • Domain Name
  • Training on Business Models
  • Incorporation Filing Fees (LLC)
  • Traffic Generation
  • Software (Accounting, writing, forms)
  • Tools of the Trade (planner, office supplies)
  • Landing Page Creation
  • Funnel Creation Services
  • Online Storage Services

The above items are just some of the expenses you will incur. Every penny you pay out for these items needs to be documented and a receipt retained. Your Bookkeeper will not charge you as much for filing your quarterly taxes and creating your Financial Statements if you have your expenses and revenue (we discussed revenue in the previous article) well documented and organized. I personally know that your Bookkeeper will love you for it, as I used to be one.

To add your financial information for your expenses that occur monthly, you can list those by the quarter and make adjustments each quarter as you review your business plan. As you identify what these costs will be, you will also be creating your monthly, quarterly and annual budgets. This will help immensely with your financial out lay as you progress through the start up and running of your business.

Legal Documentation

If you decide to create your own product, you will need to file your business documents and I strongly suggest you set up your corporation as an LLC. You will pay $20-$500 for your LLC filing depending on the state you do business in. LLC University has the cost per state listed here:

https://www.llcuniversity.com/llc-filing-fees-by-state/#LLC University

You will need to acquire an SS-4 application for an EIC number from the IRS listed here:

https://www.irs.gov/pub/irs-pdf/fss4.pdf

You will need to get your tax information from your state as some states require that you file monthly, quarterly &/or annually with Sales and Usage Tax information. Check with your local state internal revenue department.

Your business license is generally through the City &/or the County government, depending on which state you live in as well.

It’s important to get your licensing taken care of at the beginning so that you do not have to pay penalties for late filings.

If you stick with just marketing other peoples products then you will need to file a W-9, as companies that you do affiliate marketing for will require a W-9 on file which they will send to the IRS by 1099 by the end of January every year. You can find a W-9 here:

https://www.irs.gov/pub/irs-pdf/fw9.pdf.

I received some good advice from a small business owner in my younger years, while working as a professional. Her advice was to set up an interest bearing savings account and deposit an estimate of your tax amount in this account by month, so that come quarterly tax time, you already have the money there and you make the money from the interest instead of the IRS &/or the State Revenue using your money and making the interest on it.

You should keep all of this documentation with your business plan as it may be important for any auditing or possible financing that you may require.

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