Tax advice simply explained: 7 areas

The tasks of the tax advisor differ depending on which tasks you take on yourself. The main tasks of the tax advisor are bookkeeping, financial accounting, accounting of wages and salaries, the annual financial statements and of course the general advice on the subject of taxes and tax optimization.

If you are interested in the processes, the individual areas of responsibility, then you are in the right place. Learn about the risks of hiring a tax advisor, as well as 3 tips to find a good, really good tax advisor. After that, we will give you deep insights into the daily cooperation with your tax advisor.

7 typical tasks of tax consultants in companies:

1. Advice on tax preparation and structuring
2. Bookkeeping and financial accounting
3. Payroll accounting and payroll
4. Profit and Loss Account (EÜR)
5. Tax returns (much more on this later)
6. Audits of tax assessments
7. Representation vis-à-vis tax office and court

Source: Lukinski.de, tax consultant for companies

Why is it so important to find a good, reputable tax accountant?

Every euro that is not spent on taxes can be reinvested and generates further returns (profits)

That means if you pay too much tax, your money is gone. You can’t use it for new ideas and projects, which in turn bring you more profits and wealth. That’s why a good tax advisor is so important for your wealth creation.

Tasks of the tax consultant: tax returns, wages & Co.

According to Lukinski, the 4 central tasks consist of these areas in simplified form:

1. Tax returns (monthly filings and annual evaluations)
2. Wages for employees
3. Balance sheets (annual financial statements)
4. Tax structuring (set-up and optimisation)

Consulting: foundation, day-to-day business and development

The most important, especially for founders, is the tax advice and design. Taxes are not only a topic for large companies and corporations. It already starts with the managing director’s salary and tax allowances. In the growth process there are also changes in the legal form of the company (list external). If you look at a possible process, this could include, for example, the following stages that you go through step by step as a self-employed person.

Evolution a company (exemplary):

• Sole proprietorship
• Entrepreneurial company (UG haftungsbeschränkt)
• Limited liability company (GmbH)
• Stock corporation (AG)
• Holding (with subsidiaries)

Tax advice therefore begins even before the company is founded. It continues with simple, initial aspects such as your managing director’s salary and goes on to the change of the individual legal forms of companies.

Processing of tax matters

Consultations on tax structuring, concept creation for tax avoidance, that is of course not the daily routine in the cooperation. The daily cooperation with your tax advisor is mainly about the processing of tax matters, from payroll accounting, bookkeeping and preparation of tax returns, to special requests. A list of key points is worth a thousand words, so here is a summary of what the “day-to-day work” is about, the tasks of the tax advisor.

Tax consultant tasks in detail:

• Bookkeeping; this includes setting up bookkeeping, creating a chart of accounts, bookkeeping itself, account assignment of documents).
• Payroll accounting
• Tax returns; this includes wage tax, capital gains tax and turnover tax advance returns
• Preparation of tax returns; these include income, corporate, trade, sales, gift and inheritance tax returns.
• Preparation of financial statements; this includes the income statement (EÜR), opening balance sheet, annual financial statements, interim financial statements, liquidation balance sheet and explanatory reports
• … and special requests

For the sake of completeness, tax advisors naturally help not only in setting up or setting up the business, but also in winding it up, i.e. insolvency, should something go wrong.

Do I need to hire a tax advisor?

As a company and self-employed person, you are not obliged to hire a tax advisor.

However, if you do not have a sound education yourself or the risks are too great, for example because you are not a small business (with “only” 5,000, 7,000 or 10,000 turnover per year), then you should definitely rely on the support of a tax consultant. The higher the turnover, the greater the risk of making mistakes. After all, in your company you are not only responsible for yourself personally, but also for your employees. They rely on you, as well as on regular salary payments.

The perfect segue to your duties!

Even if you have hired a tax advisor, it is worthwhile to take over certain tasks yourself. Depending on how many tasks you take over in your company yourself (or through employees), you save costs with the tax advisor.

Whose work costs you more per hour: employees or accountants?

Some founders collect all receipts, then give them collected, but unsorted in the office. Already the first mistake, because so happens the assignment, to the individual account movements, by the tax adviser. With 100 receipts quickly a few extra hours, with all the queries.

Your tasks: Work with tax consultants = save money

Every hour that your tax consultant works for you, apart from the regular tasks, costs extra. If you send your documents (incoming invoices and outgoing invoices) unsorted, the tax advisor or an employee has to do virtually everything. Conversely: If you deliver everything sorted, allocated (document = account movement) and assigned, it minimizes the workload extremely.

If you write invoices in which, for example, your tax number is missing, your tax advisor has to point this out, you have to change everything, send it again. If you don’t collect your invoices sorted and chronologically, your tax advisor has to do the job, some receipts are unclear, again queries, time and costs. If you don’t use digital accounting yet, through tax software, receipts still have to be entered by hand. These are all factors that drive up the cost of your accountant.

So, in quick summary, what are your responsibilities when working with an accountant? Because:

Work with the tax consultant = save money

Very basically, there are 4 areas that you should work through cleanly.

Wages, registration, health insurance, etc.

Theoretically, the tax comes first, determined by the monthly accounting. But for us one thing is most important, your employees! Because only through good teamwork, you can achieve good results with your company. Therefore, for us first of all wages, health insurance and other liabilities that provide for a good and effective team.

PS: Good teamwork always means that you are a good motivator for your employees.

Central is the submission of wage data, always on the 15th of the month. In the middle of the month? Yes, exactly, because the payroll data must first be processed, often by external payroll offices, which in turn are commissioned by your tax advisor. This happens especially in smaller tax offices when the necessary personnel resources are not yet available.

This means that halfway through the month you send wages, fixed hours and probable hours to the tax advisor. If you have employees who do not have fixed monthly working hours, you must extrapolate the probable working time. These estimated times will then be offset against the actual working times (of the previous month) in the following month.

Caution, unaware cost trap! Health insurance

Health insurances are not part of the wages and especially company founders often only (!) calculate with the sum for wages and salaries instead of seeing the total costs that arise for employees.

Here’s a small example:

• Salary (transfer): 1.500 €
• Health insurance: 700 €
• Costs for payroll accounting: 15 €
• Central wage costs: € 2,225
• Unconscious costs: + 32,6 %.

The gap between the €1,500 calculated in the mind and the €2,225 actually paid is a whole €725, or +32.6 per cent. Therefore, always remember that the cost of wages and salaries ultimately includes not only the actual payment to the employee, but also the health insurance and payroll costs, which are additional for each individual employee.

This calculation error increases with each individual employee. So, for example, if you hire 5 employees directly at the start of the company through an investment or a loan and do not keep an eye on the costs for health insurance and payroll accounting, you will have a monthly deficit of 3,575 euros in the calculation example. If you have a loan of 50,000 euros or an investment, hire 5 employees, it has consequences quickly. After a period of 6 months, the sudden, supposed loss is already 21,450 euros. Finances are the number 1 reason for the failure of companies.

This is where another statistic comes right into play, 9 out of 10 businesses fail in the first 5 years. The most common reason is lack of funding and capitalization. Supposedly, because maybe it’s just the wrong calculation.

That’s why it’s always important: You have to take an interest in taxes and duties yourself.

Don’t leave the work (only) to your tax advisor!

Let’s recap wages, employees, and health insurance:

• Submission of wage data by the 15th of the month
• Submission of actual and estimated working times (depending on employee type)

Monthly taxes: sales tax, trade tax, etc.

From our long look at employees now to the point at hand, monthly taxes! As a business (except small business) you are obliged to charge VAT if the invoice recipient is in the country (business) and always if the customer is a private person.

The very most important thing for accounting and for accountants:

Each posting (transaction) gets an assignment (document)

Or in other words, for every receipt and withdrawal on your account, there is a receipt that provides proof of what the money was used for.

This monthly evaluation determines the amount of sales tax you have to pay to the tax office.

If your turnover is high enough, the tax office will ask you to pay business tax for the first time. The sales tax is a transitory item. The trade tax reduces your profit, the sales tax does not. Read more about the types of taxes in Germany here.

Once again summarized the most important tasks for you, in the preparation of accounting:

• Each posting a document
• Accounting almost 1 month together
• Submission no later than the 10th of the following month (tax office, previously to tax advisor)

Annual taxes: annual accounts

At the end of the year, depending on the legal form and company structure, financial statements are sent to the tax office.

If you do not file your tax return yourself, the annual accounts will be prepared in full by your tax adviser.

Your annual accounts provide information about the financial situation of your company. The annual financial statement is mandatory for all types of companies and is also sent to the Federal Gazette. In this way, company balance sheets can be viewed by the public. This facilitates credit checks for other companies and gives the tax office an insight into the current situation.

At the end of the year, there are various declarations that need to be filed, depending on the legal form(s) and company construct. For the self-employed, this includes the income tax return or, in general, the VAT return. As I said, all these aspects are taken care of by your tax advisor.

The annual accounts must be submitted by 31 July at the latest. Unless you are assisted by a tax advisor, then the submission can be extended to 28/29 February of the following year.

Now before we get to the 3 tips to find a good tax accountant, first the risks and dangers of hiring the wrong tax accountant.

Compare tax accountants: Risk when hiring

You want to find a good accountant! Because you want to avoid risks and dangers, after all, it will cost you money if you hire the wrong firm for your accounting. Ultimately, also a reason why startups fail. Cost of additional processing, advice and service and of course losses, for example if tax benefits are not taken (quote above). In the article on Lukinski, 3 specific risk factors are described that usually only become apparent after years of working together. The 3 risks first at a glance.

Assign risks to the tax advisor:

1. Intensive, regular cooperation; means commitment and time for tax consultant changes
2. Amount of monthly and additional costs; money missing for reinvestment
3. In the long term: lose money (pay too much tax, plus costs for tax advisor, lack of reinvestment) due to lack of qualitative / quantitative advice

Learn even more about 3 big risks in contracting here:

• Hiring a tax advisor: 3 mistakes

Find a tax advisor: 3 tips

In order to find a good tax advisor, there are in the article on Lukinski directly 3 practical tips with to the hand, for your search, for a good tax advisor in the proximity.

These 3 tips will help you find a tax accountant:

1. Don’t click on the ad in the search results (go directly to page 2)
2. Rating on online portals (more than 5 opinions)
3. Experiences and recommendations from successful entrepreneurs

Avoid advertisements in search results and portals

For one, never click on the ads, because these search results do not come from quality. The ads are here solely because money is paid for it. Money that is spent on advertising, of course, must be taken again. Already the costs for the tax adviser rise, because marketing is expensive. Maybe it is also not the best tax office, after all, customers still need to be recruited. Word of mouth is not enough to acquire new customers through recommendations, that is, through satisfied customers.

Ratings with quality and quantity

Tip number 2 deals with the evaluation in online portals. Here you should pay particular attention to the fact that there are a relatively large number of opinions. Buy reviews is quite simple. For as little as $19, there are real reviews in search engines and on social networks. Therefore, you should on the one hand compare the number of reviews with other offices, on the other hand read the opinions or even read through. A simple “very good” could possibly be bought.

Tax consultant experiences of other successful entrepreneurs

Tip number 3 is the safest way, you ask experienced and successful entrepreneurs in your area who can give you good recommendations. Another advantage, you have a door opener to the firm. Because good tax accountants don’t wait for new clients, they have enough inquiries through referrals.

Here again, briefly summarized, the 3 tips from practice to find a good tax advisor:

1. Don’t click on the ad in the search results (go directly to page 2)
2. Rating on online portals (more than 5 opinions)
3. Experiences and recommendations from successful entrepreneurs

Conclusion: Find and hire a tax consultant

That was our insight into the topic of finding and hiring a tax advisor. So remember, don’t leave the work (only) to your tax accountant! The more you understand and do, the less you pay for the tax advisor and the more money or profit you have left to reinvest.

You’ve learned a lot about working together, from monthly bookkeeping and wages, to your company’s financial statements. Also the 3 biggest risks and 3 tips so that you do not make mistakes when choosing a tax advisor.

You can find more on this topic in the source of the article on Luinski.de: Steuerberater.

Costs and billing

How much does a tax consultant cost per hour? How are the fees of the tax advisor calculated? How much should a tax accountant cost? And how much does a small business tax accountant cost? If you haven’t experienced tax accountants yet, here are official costs and rates for you, from the federal Chamber of Tax Advisors. Tip. Under the explanation of value fee you will find the cost table for 100.000, 200.000 and 500.000 Euro – that’s how much your tax advisor costs / earns!

• Tax consultant costs

Mistakes: 3 risks for your company

Hiring a tax accountant / mistakes – You want to find a good tax accountant! Because, you want to avoid risks and dangers, after all it will cost you cash if you hire the wrong firm for your accounting. Costs for additional processing, advice and service and of course losses, for example, if tax benefits are not taken (quote above). In the article on Lukinski, 3 specific risk factors are described that usually only become apparent after years of working together. The 3 risks first at a glance.

• Hiring a tax advisor: mistakes

Tax consultant in the vicinity

Nearby Tax Accountants – Find a good tax accountant near you? We have searched the internet for you for days to find the best recommendations for tax consultants in your area: Hamburg, Berlin, Cologne, Dusseldorf, Munich, Stuttgart & Co. for your private tax return or income tax return or more complex accounting for companies, from monthly financial accounting to annual financial statements. Including adresses, telephone numbers and website.

• Tax consultant in the vicinity

Installing WordPress: Step by step guide

In the first part you will see how to download your WordPress, with an FTP program, play on your own web space. In addition, a MySQL database is created, here all information will be stored later. Both steps you have to do only once at the beginning.

Once download, FTP and MySQL are done, you can install WordPress. After that, the system is ready to set up.

Explainer Video: Install WordPress

How to install WordPress:

• Archive Download
• Set up FTP users
• FTP tool and WP transfer
• Create MySQL database
• Installation
• Connect database and WP

• Filezilla Download FTP Program

WordPress setup

After installing WordPress, you need to finish setting up the system. In the video you will learn the first, important 5 steps. This includes the permalinks, for your search engine optimization and beautiful URL, the page title but also your home page and your blogroll. Finally, you create your first, own main menu. Your site is already built from the ground up and you can already start working.

What is a beautiful permalink?

WordPress itself would select the following link for this article:

https://fivmagazine.com/2021/05/sample-post/

This we change, through the settings in the permalinks to:

https://fivmagazine.com/sample-post/

Explainer Video: Set up WordPress

The five basic settings at a glance:

• Set permalinks
• Assign page title
• Home page and blog
• Logo of your site
• Create main menu

Buy and install theme

With a theme you make your WordPress site more “beautiful” and functional. Often it is also called template or design template. With such a theme you can change the design of your site in a few steps. How to install such a theme, you learn in this video. As you can see in video 1, you will need an FTP program. Alternatively, you can upload your ZIP archive in the WordPress back-end.

After the upload follows the activation and your first settings.

Explainer video: Install Theme

That’s what the next video is about:

• Install Theme
• Download (example: Themeforest.net)
• FTP transfer
• Activation in WordPress
• First settings

Expansion to e-commerce & Co.

After learning WordPress installation, setting up WordPress, and already having a little insight into using themes, you’ll get to the possible expansion of WordPress as a system in Part 4.

The content management system is extensible through a variety of plugins. A large part of these extensions is even free of charge. Especially for self-employed and young companies a great benefit. You can e.g. make an e-commerce out of your WordPress in no time. So you have your own online shop, right at the beginning of self-employment. Theoretically, you can learn all the basics in 24 hours!

You can get a small insight into the multitude of variations in this explanatory video.

Explainer video: Expansion to e-commerce & Co.

The contents of the video:

• Blog
• Corporate website
• Online shop
• Landing page
• Multilingual
• …

System: pages, posts, category and URL

Now that you’ve gotten to know WordPress a little better, it’s about the basic functions in the active work. In the search engine optimization, however, it also depends very fundamentally on many, individual aspects. Roughly it is about:

To do content marketing you need good content. When you first take a look at WordPress, many questions naturally arise.

Important to mention are pages, or in the English system “Pages”. Times you must for all static content, eg your home page, contact page, privacy but also your imprint.

Posts are used for your daily content. E.g. news, new products but also typical SEO texts.

You should use categories sparingly and use as few as possible, but as many as necessary. As a rough rule of thumb, five to ten categories are perfectly adequate.

Last but not least, let’s take a look at the URL. It is important for the search engine optimization of your site, so that you can be found. You can find more tips on the URL of your page in the original article WordPress and SEO Tips on Social Media One.

Explainer video: Pages, posts, category and URL

In the video “System: Pages, Posts, Category and URL” you will learn:

• Page
• Mail
• Category
• URL

SEO: Search engine optimization for Google

You want to learn more about search engine optimization? Through SEO you can bring your page on Google far to the front. The higher your page is ranked in the search results, the more people would click on you. Whether you want to become a real estate agent, tax accountant, and open your own online fashion store or even yoga classes in your city. With search engine optimization you can attract new customers! You want to learn how to do it? Read the second part about becoming self-employed on the internet here:

• Part 2: Writing SEO texts

More WordPress and SEO Tips!

These and other great videos about becoming self-employed, making money on the internet, search engine optimization but also digital marketing can be found not only in the original article WordPress and SEO tips but also on the YouTube channel of Lukinski. Don’t miss a new tutorial and follow Lukinski on YouTube!

We also have some other interesting articles for founders here:

• Develop business idea
• Establish a company: Legal Forms
• Tax accountant near you: Tips
• Doing your taxes: Videos

Start a company: But which one? List

Shall we list all possible business forms in Germany? There are sole proprietorships, civil law partnerships (GbR), registered traders (e.K.), general partnerships (OHG), limited partnerships (KG), entrepreneurial companies (UG), limited liability companies (GmbH) and public limited companies (AG). In addition, there are sometimes even more special forms, such as the GmbH, the GmbH & Co KG and GmbH & Co OHG, and even family foundations. Which type of company is right for you, your requirements and your goals?

Tip. All company forms in one list. Now on Lukinski: Legal forms

Company: List

1. Sole trader / sole proprietor
2. Civil law partnership (GbR)
3. Registered businessman (e.K.)
4. General partnership (OHG)
5. Limited partnership (KG)
6. Entrepreneurial company (UG)
7. Limited liability company (GmbH)
8. Stock corporation (AG)

PS: You are still missing a brilliant business idea?

Find a business idea: Idea to business plan

From the idea to the finished business plan, before you decide on a type of company, you need a valid (profitable) business idea. But how do you come up with a good business idea, with as much demand and as little competition as possible? Here’s a little free guide for you and your business idea:

• Find a business idea

We also have other interesting articles for founders and the topic of taxes:

• Tax accountant near you: Tips
• Doing your taxes: Videos

Real estate agent: The profession under the magnifying glass

Training is the first step for a career in the real estate industry. Not only young people start their way into the highly competitive industry, but also career changers begin training or further education. Legal framework conditions for real estate agents, communication and psychological aspects as well as marketing are contents of this training and fixed components in the everyday life. Everything about the life of a real estate agent sorted thematically in this list.

Buy and sell (external & free of charge)

Learn from the experts. You can find many, many more guide articles for free at Lukinski. Here you can learn everything you need to know about buying real estate for free. Start in general with buying real estate, go over your specific type of real estate, from apartment, to house, apartment building to buying land. Also important, everything about the purchase contract (who pays the costs?), ancillary purchase costs and saving taxes with real estate. through legal forms such as a real estate GmbH or family foundation.

However, Luxury Realtors also write new articles on selling property every week. With more specific advice pages on selling a house, selling an apartment, and multi-family house and land.

Tip! Overview Real Estate XXL

The world of real estate is complex and multifaceted. If you want to keep an overview and avoid making mistakes, you should prepare well and clarify as many open questions as possible in good time. No matter whether you want to build, buy and rent out a property or live in it yourself, or even use a property as an investment to generate passive income: The preparation is the A&O. Here you will find articles, as well as book and video tips with successful and helpful books and videos on the subject of real estate – including tips and tricks from professionals and experts.

• Book & Video Tips Overview: Real Estate

A day as a real estate agent

How does a real estate agent spend his day? Are you interested in the profession, but you don’t have a clear idea of what it’s like? In this video you will find out! We slip into the everyday life of a real estate agent!

How to become a real estate agent?

Study or training? You hear about them all the time, but many people ask themselves: How does one become a real estate agent in the first place? Do you need a degree, an apprenticeship or something else altogether? Who has always been interested in the profession of real estate agent and would also like to enter this profession, learns here how to get to his dream job:

Career changer through further training

You’ve been in the business for years and you’re increasingly realizing that you’re drawn in a different direction and that’s real estate? Not only 20 year olds can become real estate agents! What’s the best way to make a lateral move into real estate? Here you can find out how to make your dream come true and become a real estate agent:

Make $300,000?

Earnings of a real estate agent: When you think of real estate agents, you think mainly of a luxurious lifestyle, but what is really behind it? How much does a real estate agent earn? As a real estate agent you can earn little, but also a lot of money. How you manage to belong to the high earners, reveals this video:

Business start-up and self-employment

You want to stop being an employee and start your own business? How to do that, what your first steps should be and an insight into the first year can be found here:

Self-employed real estate agent at the age of 18? Is that possible?

You are finally of age and want to stand on your own two feet? Your goal is the real estate industry? This video will show you how you can fulfill your dream of becoming self-employed at a young age and earn your first own money with real estate!

Entry into the real estate industry

Do you want to enter the real estate industry as an agent? There’s a lot to consider here, find out how to clear the first hurdles and then get to grips with attracting clients and building your property portfolio. Alex Fischer informs you here about the entry into the industry:

Build up a real estate portfolio

Many real estate agents have a problem having enough properties in inventory to market. But as a real estate agent, it’s important to land a lot of clients, but you can only do that by offering a variety of properties. Learn how to find good properties and build an appealing inventory in this video:

Customer acquisition as a real estate agent

As a real estate agent, a good customer base is essential. So the question is how do you get this good customer base? Which acquisition source most real estate agents ignore and how you can use them in the future for your real estate business, that you learn in the video.

Real Estate Agent Starter Kit

Just like back in school, there are a few things you’ll need to get you started as a real estate agent. Here’s a list of things that real estate agents should have ready when they start their careers to bring some structure to their daily lives. This is also something for all trainee estate agents to impress your boss with. So what are you waiting for?

What makes a top broker?

Your dream job is to be a real estate agent. But what makes a top real estate agent? You will find out in the following video. Afterwards you will know how suitable you are for the profession, what you already bring with you and what you can still optimize to become a top realtor:

Characteristics of the perfect real estate agent

The real estate agent: what personal and professional skills must he possess to make it to the top? Luxury agent Marcel Remus reveals the 4 most important qualities to become a perfect real estate agent: Top Styling, Best Preparation, Emotional Sensitivity & Easiest Problem Solving….

Inexperienced real estate agents: worst mistakes

Just starting out in the real estate agent profession and wondering what faux pas to avoid? This is quite normal as many inexperienced real estate agents make mistakes at the beginning of their career. However, many real estate agents fail because of these mistakes and have to give up their self-employment. So that it doesn’t come to that and you start successfuly in the profession, we present the most common mistakes that happen to inexperienced real estate agents at the beginning:

Are rents too expensive? Ten questions

When looking for an apartment, everyone has probably come into contact with a real estate agent at some point. Do you have questions you’ve never asked but always wanted to ask? In this video you get 10 questions answered by a real estate agent:

Further links

If you would like to know more about the topic of real estate, then take a look at our other articles on the topic of real estate. We have compiled book recommendations and video tips for you on all relevant topics, from real estate financing to real estate as an investment to renting out an apartment or finding an agent. Become a real estate professional with us!

Buy and rent property

Buying and renting real estate: For newcomers to the real estate industry, it’s still a world where you can’t see the forest for the trees. We want to make this entry into the industry easier for you with the best recommendations and tips from the pros. Our book tips walk you through the entire world of real estate and leave no topic out. We focus on home buying, renting properties and all legal and contractual issues. Sorted by most and best reviews, we put here for you a list of the best guides on real estate.

• Book recommendations on the subject: Buying and renting real estate
• Video tips on the subject: Buying and renting property

Real estate financing

Real estate financing – You want to buy a property, but do not know how you can finance your dream? Terms such as loan, interest, credit, repayment or building society contract only raise more questions for you? Here you will find all the important information on the subject of real estate financing: from financing with equity to financing without equity to applying for a loan, we cover all the important topics!

• Book recommendations on the subject: Real estate financing
• Video tips on the subject: Real estate financing

Build property

To build or to buy a house? This question is on the minds of many prospective buyers. Here we show you the advantages and disadvantages of both options and offer interesting tips on financing. Both options have their advantages. A new build has the great advantage that you can determine the layout of the rooms according to your wishes. In an already existing property you don’t have to deal with the complicated construction phases and you can live in your own home much faster. Here you will find books and videos that will help you to finance your dream home and show you what you should pay attention to.

• Book recommendations on the subject: Building real estate
• Video tips on the subject: Building real estate

Overview Real Estate XXL: Investment & Co.

Here you get back to the overview of book and video recommendations on the subject of real estate in Germany. Investment cases, capital investment, passive income, house or apartment buy and rent and much more is explained to you here by experts and understandable. In this XXL guide you will find information and articles on the most diverse questions on the subject of real estate.

• Back to Book & Video Tips Overview: Real Estate

Shit happens! Make it a T-shirt

Projects fail due to internal or external influences that you as an entrepreneur can sometimes not count on. For me it was the “Social Analytics” investment, for example. A few weeks after the launch of our software “Social Analytics”, Monitoring and Influencer Management for Instagram, we had to stop the service again. Our mistake, we had underestimated the risk that Facebook would restrict third-party access. Almost three quarters of a year of work and preparation were within seconds for the cat. So it’s not always just about opportunities and risks, advantages and disadvantages, even access restrictions, whether from social media networks or suppliers, can quickly put you in your place. After all, you have a beautiful story and learn from your experiences!

Many have failed with a business idea

As strange as it sounds, many icons from the business world say that they have always learned the most from their mistakes, sometimes even more, than from successes and the best ideas! You can then contribute your expertise to many discussions or projects. In this respect, you no longer have a business model, but your history and learnings, which will certainly be of interest to others.

At this point I would like to point out three quotes from great entrepreneurs, which I find very inspiring myself. Mister Thomas Edison has also had the experience of failure, the man to whom we owe the light bulb, among other things.

Quotes on failure

Even he liked to talk about his failed projects and still shapes entrepreneurs worldwide:

Mr. Thomas Edison

“I didn’t fail – I discovered 10,000 ways that didn’t work” – Mr. Thomas Edison

In the area of the great inspiring quotes and the great entrepreneurs, it is also worth taking another look at Mister Henry Ford. The man I already mentioned in relation to the calculation of marketing tasks with the sentence: “For every dollar you put into your product, you have to have another one ready to make the product known”. Henry Ford also frequently referred to the topic of “failed projects” and “failure” per se. The second quote that I will mention in the context of the book refers to the absolute beginning, the foundation. Starting a business is like playing football with friends as a little boy. It’s just fun! If you don’t take that into account, you give up quickly and that happens in most cases. If you manage to stay in the market alone for three, five, or even seven years, that’s half the battle, because most of your initial competitors automatically disappear after some time. So you don’t have to focus too much on the others. Concentrate on your success and on yourself as an entrepreneur. That’s why Henry Ford said:

Mr. Henry Ford

“There are more people who surrender than those who fail” – Mr. Henry Ford

To achieve all this, you need attention to detail and precision! That’s why here’s my favorite quote from Confucius. From spontaneous device failures of several notebooks in the office, to spontaneous flu waves in winter and high levels of illness, to demanding customers and projects, to waiting for the craftsman.

Confucius

“If one is not patient in small things, one brings the big projects to failure” – Confucius

Not only the old teachers have failed, of course the younger icons in business have also fallen on their noses a few times with projects.

Lose fear of the risk

So that you can continue to lose your fear of risk, here are three truly fascinating examples from the business world. Trial-and-error, that means trying and failing. The principle belongs, so to speak, to good entrepreneurship! Who does not also fail sometimes, dares in the reverse conclusion too little new. When they fail, it’s similar to the great buildings of history: We’re all talking about the pyramids that are still standing. Thousands and thousands of pyramids have been built. So that we do not always look only at the great successes, here is also a look at the attempts of large entrepreneurs to establish new business models.

failure at a young age: Today’s icons

Jeff Bezos, founder of Amazon and currently the richest man in the world – despite a billion divorce and costs of over 35 billion – failed with several Amazon projects. Morten Lund, founder of Skype, one of the communication platforms for video telephony, slipped into bankruptcy twice. Then the story of Bill Gates, Microsoft founder, his first software first nobody wanted to have. In the end, he even offered it for free, but nobody used it. Shortly thereafter, he founded Microsoft. The rest is history! These three giants in the digital industry are friends of principle trial-and-error. A small excerpt:

Jeff Bezos (Founder: Amazon)

Beside all successful projects, like one of the biggest online shops of our time or current and new the space travel and the colonization of the moon, there were also a few projects which did not go down so well with the society. His search engine A9 should become a competitor model to Google. Market shares could not be gained and so the project was terminated at the end.

But he also wanted to create a competitive model for eBay. This means that not only professional traders can trade, but also private individuals. “Amazon Auctions was the name of this project. This was also discontinued without success after a short time. Here you can see how difficult it is to compete against good and established products and to dare something new and to establish it on the market. Google, but also eBay are already so well positioned and function almost independently that it is difficult to get people to move to new platforms and switch.

• Search engine A9 – fail
• Amazon Auctions – fail

Morten Lund (Founder: Skype)

Morten Lund, Skype founder, is an excellent example of the skipjack of today. He had his first insolvency at a young age. His first business model: to sell Abitur hats. In Denmark, Abitur hats are the absolute bestseller for school leavers. Unfortunately, he did not manage to sell his hut, as it is an extremely seasonal business, he had to declare bankruptcy in 1994, immediately after the graduation celebrations. It shouldn’t be that way! Fifteen years later, he went bankrupt for the second time, in 2009. In fact, he had managed to organise all the money earned by Skype, the investment in 2003 and the subsequent growth spurt, in such a way that he went bankrupt for the second time. Nevertheless, he has not given up and since 2016 he has actually been debt-free again. A great example of a role model for someone who also fails in higher spheres and not only with a single project, but also privately.

• 1994 Insolvency (sale of high school graduation hats in Denmark)
• 2003 Invest in Skype, made millions
• 2009 Insolvency #2
• 2016 Debt relief

You can learn from Morten Lund’s story as an entrepreneur. Give up? What’s the matter with you? Those who really believe in themselves should always go on and believe that they will make the breakthrough at some point. Others have finally made it!

Bill Gates (Founder: Mircosoft)

Bill Gates is one of the most fascinating companies in the world for me. Not only did he start his business out of a garage, he became the richest man in the world and gave up half. What Bill Gates also deserves credit for is that he managed to leave his own company at a very good time. Many remain in the company until they are old and then do not find the right successor. Bill Gates took early care of a structure that would replace him. Hats off, Mr Gates! From garage to richest man in the world and back to privateer. Everyone starts with their first business idea. Will it directly become a million or even billions of ideas?

His first business idea was born in the high school “Traf-O-Data”. The software made it possible at that time for the very first time to carry out automated traffic counting, no longer by people with pen and paper. During the first presentations, however, the demonstration did not work without errors. The interested parties were less enthusiastic and so in the end not a single authority was interested in the software solution. Bill Gates was so frustrated that he ended up offering his software completely free of charge. Still, she didn’t want an agency. A typical moment to say, “I can’t do it.”

But no! Short time later, he developed in collaboration with his high school friend Paul Allen “Microsoft”. Since the beginning of the computer era, the world’s most popular operating system for computers and notebooks.

• High School: “Traf-O-Data”: Demo did not work (road traffic census), later free of charge, yet no authority wanted it
• Learned intensive software writing
• foundation “Microsoft”

Three icons whose products everyone knows. Amazon, Skype and Mircosoft. Three entrepreneurs who have experienced setbacks in their lives and yet remained steadfast. Believing in yourself moves mountains, as you can see from these examples, it is not a saying.

Amazon founder Jeff Bezos is currently even competing with other American greats such as Elon Musk or Virgin founder Sir Richard Branson. You and other multibillionaires are about to conquer nearby space. Elon Musk company SpaceX focuses mainly on logistics between earth and orbit. Jeff Bezos wants to be the first to colonize the moon permanently and thus provide a stopover for future Mars landings. Virgin goes mainly to space tourism and flights in nearby orbit…

Think big!

And already we are away from failure and from the big ideas that change the world! The perfect transition for you and your business idea.

Failure – Top 11 reasons

Go geht´s! Here are the top 11 reasons why so many start ups fail in the first 5 years:

Place 1 – The market does not need them

The third Burger Restaurant in the street, another brand that Cola offers in the beverage trade, a new car brand with a combustion engine that wants to be at the forefront. Who needs that? Nobody! Therefore the missing market is also number one when it comes to the failure of start ups. Your product fails because there is no need for it.

Place 2 – the money goes empty

The absolute classic and also often mentioned here: Finances must always be solidly planned and of course also handled in the operative business. If you calculate projects incorrectly, you will quickly run into difficulties with payments. Once this point has been reached, there are, unlike with private individuals, hardly any deadlines and certainly no postponement. You didn’t pay the rent? The business landlord can sue you almost immediately if the payment reminder and reminder are through. Employees are not paid? They’re understandably quicker gone than you can look. The supplier doesn’t get his money? Then you won’t get any more goods. No goods, no deliveries, no sales. Financial problems, number two in the list of reasons why start ups fail.

Place 3 – The wrong team

When it comes to personnel, there is of course a lot to consider, but in the end it all depends on the entrepreneur and the right decision as to who should be in the team and who should not. If these decisions are made wrong and the wrong people are hired without the right knowledge and motivation, a project can fail in the long run. After all, the person costs money and in the end nothing is earned, which is why follow-up costs arise due to lost profits. Your team must therefore be well selected, trained and able to deliver practical performance.

Place 4 – The competition gets you ready

Sounds hard, but it is! Especially in the area of software, the possibilities of adopting concepts are fast. Of course, this also applies to simple products. Producers in the Far East can copy any kind of product if they have the necessary small change.

A friend of mine had a successful cereal bar. Approximately 15 months after its foundation, the same product came onto the market from a large manufacturer. The direct competition stood overnight on all supermarket shelves. The name, almost identical. The composition, same. The outfit, right away. To compete as a start-up against the international food company is a big challenge. Competition can quickly destroy the business, especially when the business idea is particularly easy to adopt. That’s why you need a good entrepreneur who stands completely behind the whole, has experience and knows how to compensate your own deficits and how to position your own brand skilfully next to the competing product. At the end also an absolute success story, sold!

Place 5 – failure by price and cost

Determining the prices of products is not easy with under! The more difficult it is to quantify a product, the more complex the price calculation becomes. A screw, for example, can be quantified quite accurately. A certain material price, a certain production time, certain electricity and personnel costs. Ultimately, an exact figure of 0.37 euros net per screw is on sale. Whoever opens a start-up in the field of influencer marketing has a much more difficult time. How exactly can two postings plus one story be calculated from a specific person with a specific number of followers, an individual number of interactions? Each offer is correspondingly costly and time-consuming. Find the right price so customers can access your job. Ultimately, that’s exactly how it can fail. In the same part, the costs for procurement, for example, for material, are added. If you don’t manage to reduce costs over time, your profits won’t rise, or will rise very slowly. The profit lies in purchasing!

Place 6 – Your product is bad

Honest but true, your product can also just be bad! The workmanship is not right, the quality, the shelf life is poor, but maybe you’re just harvesting a Shitstorm because your product is discredited because of a quality that hasn’t been considered before. Everything was right and in the end only one detail was decisive for the entire business model to collapse. The same can of course happen if you can’t keep up with your competitors in a certain period of time. If, for example, a new industry is opened, such as bus transport in Germany or, for some time now, electric scooters, then the development in the market is extremely fast. Business models adapt within a few weeks, after one or two years the first competitors merge and after three or four years the market clears itself of its own accord. If your product can’t keep up with the market fast enough, people will buy from the competition.

Place 7 – gaps and errors in a business model

Here is a good best practice model from the United States. A big music festival, with big investors. Location of the mega festival should be the island of the former drug baron Pablo Escobar. Everything was discussed with the family, the island was allowed to be used on the condition that no advertising was made with the name of the family. Of course that’s exactly what was done and directly advertised in the first commercial that the festival takes place on the former private island of Pablo Escobar. Spontaneously the contract for the location was cancelled and the whole festival fell into the water. The reorganization within a few weeks is therefore impossible. After all, it was (at least announced) the biggest festival in the world. Financed with millions, it has now become an absolute debacle. A clause that brought everything to failure.

But it can also be a financial investment product. Instead of keeping winnings on your bank account at zero interest, you want to invest them profitably. Market fluctuations were not included in the planning. Suddenly there is a dent, worldwide and due to trade conflicts. The price goes to the cellar for a short time. Option A: You still sell your papers to be able to pay the employees for this month. But you don’t want to sell either, because your capital is tied to the financial product. Option B: You keep the securities in your portfolio, because next week the prices could go up again. What to do now, with the best will in the world, is no easy question.

Place 8 – bad marketing

Already the legendary Henry Ford – he revolutionized assembly line work and thus the automobile industry – said, “for every dollar you put into your product, you have to have another one ready to make your product known”. Many invest enormous sums in the business model, logistics, storage and personnel. They forget that the product has to sell in the end – how much space and financial resources do you give your marketing? Sales only take place when people come into direct contact with your product or service and are satisfied. You can have a great idea, but if the right people don’t hear about it, the whole business model will fail.

Tip! Especially multipliers are important, experts and people with a large community. But even these have to be reached, convinced or booked. However, it is worth investing time in such individuals with a high reach because they potentially reach far more people than traditional brand advocates. In the restaurant it is the free dessert for the blogger, in the online shop the personal letter for ordering a magazine. Because of course you assume that the order is a test. You got a celebrity ordering, or a management? Also here a personal cover letter should be with it or a few free products, otherwise nobody feels really adressed. With a bit of luck, the person will mention you to Instagram, for example, or become a regular customer and order regularly from you.

Place 9 – ignore customers and opinions

Criticism, especially constructive criticism, is worth its weight in gold for you as an entrepreneur. If you want to understand criticism positively, then simply see it as free market research. People take time to look at your product, test it. In the end, they even give a rating. Learnings that should be included in the entire product development process as well as the development process of your own brand and services. Very few people rate products or services after a single use. As a rule, the consumer simply resorts to a competing product for the next purchase, a situation that must be avoided at all costs. This is why it is so important to react to the opinions of the customers and to include them in the own development process and direct contact.

Tip! Respond to every review and comment. No matter whether it is the algorithm in a search engine or the one in a social network, the own interaction is measured. The faster you react to requests, ratings and comments from users, the higher your ranking will rise.

Place 10 – The wrong time

Some investments can also be made too early, just as companies can be founded too early. But trends also emerge and disappear within a very short time. If you want to play on Amazon, for example, and constantly place new trend products here, you have to be on your toes when it comes to timing. This year the “Flamingo for the swimming pool” may not be a trend anymore and you will sit on 5.000 pieces. Your product may even have been trendy at the beginning of summer, but due to the constant rain in midsummer, the trend and thus the sales dropped again. Next year it may become the ultimate trend with the post of an influencer. Not everything is in your hands, some things you just have to take as they come.

The wrong time may be too early, but definitely also too late! That is why market analyses and your assessment of the market development are extremely important. When you think about the perfect moment. Until the development and the organization are completely through, so that you can operate viably in the market, it can take months from brainstorming to financing to the first customers. While a product is still totally hip today, it can be “out” again in a few months. Also consider the cyclical movement of seasonal business, trends and product half-lives.

Place 11 – You lose focus

Point number 11 always makes me feel at home! After making the ultimate decision to become an entrepreneur with staff, offices and international relationships, I focused for two years. Before that, I worked for many other companies, as a one-man advertising agency, so to speak. I’ve done more than 100 projects, I’m just talking about the bigger ones, not about 100 pizza flyers at the beginning and probably 400 logos in total, from iBeacon technology to the pharmaceutical industry, automotive tuning and scene clubs. From this varied work it was really difficult to focus on one project for two years. Of course, I didn’t just do that during that time, by the way, I also set up a fashion magazine as a satellite project for the model agency and a short time later, due to the upcoming inquiries for influencer marketing, a social media agency. At the beginning of this year alone, three book publications, real estate portal and investment in the music industry. I’d like to do 20 more projects and start ups right away! But stop! Here I always remember reason number 11 of failure, you lose focus.

For me, this means fewer new construction sites, more a large high-rise building, building stone by stone. My own little daily fight! As a little inspiration I grabbed an empty DIN A4 sheet sometime in the evening. It only has two letters on it. The abbreviations of the company on which I want to focus (proportionally, most). It’s been sticking over my bed for a year now, so I can see it every morning and every evening and remember every time what my focus is on.

But most of them fail because of basic things! As a rule, they set the wrong priorities, too much partying, too much free time, too little active work. If you focus too much on your own leisure time and too little on the company, you’re in for a knockout.

Business idea: This is the beginning of independence

15 seconds, this is the shortest time for an elevator pitch. This form is used e.g. for extremely short encounters, in everyday life, at events, or at the airport. Don’t waste a lot of time, the most important thing, let’s move on. The longest form of the short “Elevator Pitch” is 45 seconds. That means you have about 15 seconds for the presentation, up to 45 seconds. Within this short time window, everything important for the banker, the customer or the investor must be explained in a way that is easy to understand.

What exactly is your idea?

Create ideas? Go openly through the world

Stroll! The good strolling! If you didn’t know the word yet, I picked it up somewhere! Strolling is, so to speak, “going for a walk without having an exact goal in mind”. My absolute favourite for ideas, but also for a clear head! I myself like to walk around for hours and also do scripts for books or speeches, sometimes also for business models. Sometimes I run about 15 km on a Sunday. Stroll! The good strolling.

But creating ideas is not only possible by getting actively involved, of course it is also possible passively. Daily little problems you encounter in the old town. Challenges in everyday life. Small useful extension for your fellow men. For example, if you see more and more e-scooters in the city centre, it would make sense to think about the phenomenon.

Ask yourself questions about everyday problems

• Is there already a suitable lock for electric scooters? Are there already easy to install lighting systems?
• Is there already sound systems and music?
• What about an app and a small tracking box to find the scooter again, e.g. in case of theft?

Where do you see gaps, missing concepts?

Such ideas can also be found in the private sphere. If you have friends in your environment who have children, you could take up this idea and say, how could you make the life of your parents easier? Babies grow fast and therefore constantly need new clothes, but also new toys that suit their age. Maybe there is still potential in online trading, or even exchange opportunities. Is there perhaps already a platform on which parents can coordinate and vote for the kindergarten, play times or even babysitting can agree? Perhaps a common appointment calendar with befriended married couple from the kindergarten and the school?

Ask yourself many questions at the beginning! Of course, most of them will lead you to the realization that everything has happened before! But at some point you’ll get a few questions that are interesting and don’t have a concept yet! It is possible to compulsively create ideas, but it takes time. As an entrepreneur you will probably always have new ideas. Only after some time will you develop a feeling for what meaningful trains of thought are and what is just a waste of time.

keep your notebook and smartphone handy at all times

Therefore, my recommendation is to always have a small notepad and a pen with you, or simply the smartphone with the appropriate app for notes. Without a lot of bells and whistles, you just take notes and collect them. If you have a good idea, write it down! Because often ideas come all of a sudden and have to be recorded. While you’re talking to friends, while you’re doing sports or just walking. Of course, you don’t always have the right person to talk to when validating (testing) an idea, or a notebook to do more detailed data analyses yourself.

Sometimes it is also good to leave an idea lying, but if it is already noted down, it can no longer be forgotten. So your mind constantly subconsciously remembers the idea. So you will come over time to meaningful additions, or to the conclusion that the idea is not so good after all.

In the time in which your notes are well and securely stored, you can ask yourself further questions. What is the market situation like? Are there comparative offers on the Internet? Are there perhaps also competition which was not considered at all? If you see the people in the city centre, could you imagine them with your product? For some ideas, of course, there is no market yet, so try to put yourself in people’s shoes. What are the daily tasks, challenges and pros?