To sell books online, hook up with wholesale distributors

Dear Karen: How would I start an Internet company that sells children’s books?

Answer: For books from established publishers, open accounts and order inventory through wholesale book distributors such as Ingram Book Co. ( www.ingrambook.com) and Baker & Taylor ( www.btol.com).

“You’ll have to go through a credit check and buy enough books to meet their minimum orders, but they do accommodate very small bookstores,” said Colleen Dunn Bates, founder of Prospect Park Books, a boutique publisher in Pasadena.

If you want to sell self-published books, you will need distribution agreements with individual authors, she said. You can also join affiliate programs such as those offered by Amazon.com (affiliate-program .amazon.com), in which you set up an online account, market their books through your website and get paid a percentage of each sale.

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Free aid can prep firm for disaster

Dear Karen: I’ve already reduced my staff. What can I do if the swine flu hits my company?

Answer: Small companies can be adversely affected when even a few employees can’t work. It’s especially important for you to create a “business continuity” plan in case of a temporary shutdown from an outbreak of swine, or H1N1, flu or another business disaster.

Find free business disaster templates and tool kits online, including at the website of the Small Business Administration, www.sba.gov (click on “disaster preparedness” from the home page).

Arrange for employees to work from home if your office is closed by quarantine or they are infected but feel well enough to work.

“In most instances, small-business owners and their employees can remain just as productive as they would be working from the office by accessing Web mail, forwarding phone numbers and receiving faxes via e-mail,” said Jim Geiger, founder of Cbeyond, an Atlanta technology firm specializing in small-business disaster preparation.

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‘Red flags’ rule targets ID theft

Dear Karen: Can you explain the “red flags” rule for small business?

Answer: The “red flags” rule is a set of Federal Trade Commission requirements aimed at preventing identity theft. It applies to all businesses -- large and small -- that are creditors, financial institutions or that offer “covered accounts” for their clients. The rules require such businesses to devise a plan that helps them recognize the warnings signs (or “red flags”) associated with fraud and identity theft.

“The FTC estimates that the red flags rule will apply to approximately 11 million businesses,” said Edi Goodman, chief privacy officer of Identity Theft 911, an online security firm in Scottsdale, Ariz. The requirements, which will be enforced starting Nov. 1, are meant to shift the burden of preventing identity theft from consumers to businesses that issue credit.

Businesses that don’t comply with the red flags rule could face civil penalties of as much as $3,500 per violation. More information about the rule and which businesses it applies to is available at the FTC website: ftc.gov/redflagsrule.

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