2007 October
Published October 31st, 2007
A small business loan helps small businesses by providing working capital to buy inventory, supplies, a building or other things that your business needs. This can be helpful to business owners who are just starting out, or who need a little breathing room as far as purchasing things for their business. It is basically a certain amount of money that a lender gives to a small business with the agreement of how to pay it back, how much interest will be paid, and how long it will take to finish paying it back.
There are different types of small business loans. If you are applying for an unsecured business loan, you are trying to get a loan based on your credit score. To get an unsecured loan without any sort of collateral, you will probably need a very high credit score with no blemishes against your record. In order to qualify for a small business loan, you should know what your credit score is. There are other qualifications for getting a small business loan as well.
You will need to supply the lender with several things in order to qualify. Along with the initial application for the loan, you will also have to provide a purpose for the loan. This means a statement of what the loan will be for. Do you need money to purchase inventory, hire employees, or rent a storefront? You may also have to let the lender know about the business history and provide financial statements for the business for the past three years. Some lenders will ask for the amount that the owner has invested in the company to this point. Some other things that you might need are:
* Lease Details
* Signed Personal Financial Statements
* Projections of Cash Flow, Income and Expenses
* Personal Resume
Generally, lenders look for a good character, the ability to pay back the loan, and adequate equity or investment in the business. If you don’t have a great personal credit record, you may need some type of collateral to put up for the loan. This could be property, a home, or even an automobile. This is called a secured loan.
It can be overwhelming to a small business owner to try and figure out the steps for getting a loan. The first thing you should do is speak to lenders about your needs. For small businesses, the best place to start might be the Small Business Administration. There are many other lenders, though, that will help you as well. A loan officer will help you determine what to borrow, and will let you know what you need to submit in order to qualify. One great thing about a small business loan is that once you have paid it off on time and without late payments, you will be able to qualify for a larger or faster loan in the future. That’s why it’s important to stay on track with the payments and make sure that each one arrives on time or early. A small business loan can be a great benefit to a company that is just starting out, or that just needs that extra push.
Tags: advice, Finance, Finance and Accounting, loans, small business loan, Starting a Business, startup capital, startups, tips
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Published October 31st, 2007
A Call to Action is a phrase used to get the customer to take some sort of action. For an e-commerce site, that can mean something like:
* "Add this item to your shopping cart"
* "Click here to subscribe"
* "Order now"
* "Upgrade to the Power Pack"
* "Click here to download"
Typically, an e-commerce site has a goal in mind for their visitors: perhaps a sale or a subscription to a newsletter. A Call to Action is a strategy that tries to trigger visitors into doing something you want them to do.
Why do Calls to Action work?
Customers are on your site for a reason: you’re offering something that they want. A Call to Action gives your visitors a clear and easy method to obtain the products or services you just offered. Don’t leave them wondering what the next step is.
What are some of the benefits to having Calls to Action on your website?
* Increasing Sales
* Gaining Subscribers
* Building Your Mailing List
* Lead Generation
* Obtaining Testimonials
* Finding Out What Your Visitors Want (from a survey).
How to implement effective Calls to Action on your website
Give your visitors the answers they are looking for - Think like your customers and answer all the questions that they would ask. Be sure to give enough information to answer their questions in a clear and concise format. Just make sure you are not overstating your point or drowning your visitors in too many words.
Have reader-friendly website text - Blocks of long, uninterrupted text are hard to read and are sure to drive visitors away. Use bold headlines, bulleted points and short paragraphs to make your points. Take a look at your website’s content - make sure it’s inviting and easy to read.
Give them a reason to act - After visitors have learned about your products or services, it’s time for them to take the next step. That can be something as simple as an "Order now" button to something as tantalizing as a "Click here NOW to receive an instant 25% off coupon!" The use of action words is the key - the point is to get them to move forward, without looking back.
Minimize their risk - Give visitors a guarantee that they will be satisfied with their purchase. Perhaps a 30 or 60-day money-back guarantee or a 1-year warranty. You’ll need to decide what is best for your particular website, just be sure to keep your customer’s interests in mind. If you are confident with your products or services, you should have no problem offering a substantial guarantee or warranty to give your customers a sense of security.
It’s important to remind visitors why they came to your site in the first place. They came because they were interested in something that you offer. After you have given visitors all the necessary information, it’s time for them to either take an action (buy, subscribe) or decide that they are not interested. Of course, you don’t want to be pushy or annoying - just helpful, by making their decision easy with having the information they need readily available.
Tags: boosting sales, E-Commerce and E-Business, online busienss, website sales
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Published October 31st, 2007
Insurance is a part of risk management. You are basically keeping one step ahead and making necessary steps in order to overcome some type of damage to your business that will result in a loss. You are preparing your business for the chance that it could be robbed, burned down, flooded, or even for lawsuits; however, with small businesses, there is often the need to look at what insurance will be the most important because of the sheer expense, which many businesses simply can’t afford. While insurance can be very complicated, and a lot of it really depends on your own individual business, there is some insurance that most businesses need to make sure they have.
Fire is one of the most utilized insurances because no matter where you live, a fire is always possible. This is especially necessary to have if you rent an office building that is nearby several other buildings. You might do a great job controlling what happens in your office, but you can’t control what happens in your neighboring office buildings.
Burglary and theft insurance is also very important. As a business that takes in money, you are at risk for theft. Theft insurance helps to cover any items or money that might be lost during a burglary. It may also cover any damage that is done to your office during the break-in. This is one of the most common types of insurances that businesses get, and for good reason.
Liability insurance is very important because it protects you in the case of a lawsuit. If there is a small chance that someone could place a lawsuit against your company, liability insurance is necessary. After all, these days there aren’t many businesses or topics that haven’t been covered in some lawsuit or another - take the recent dry cleaning lawsuit in Washington D.C. as a prime example of the importance of liability insurance.
If you have taken out a loan, there may be stipulations in the loan that require you to have a particular kind of insurance. You definitely want to check that out and make sure that you are carrying the necessary insurance that you agreed to by signing for the loan. If you’re not carrying the insurance that is stipulated in your contract, you can be legally accountable.
One thing that a lot of small business owners do is work with an insurance broker to assess the risks particular to their individual business. For example, if you’re in a high rise office building, the flood risk maybe pretty low; however, burglary might be very prevalent in your area. It really is a matter of situation. Talking to an insurance broker is a good idea so that you can make sure you’re covered on at least the most important things.
Tags: insurance, small business insurance, Starting a Business, startups, types of business insurance
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Published October 30th, 2007
If you are thinking about opening an online store but don’t have a lot of money to invest in inventory, then dropshipping may be your answer. That means you only purchase inventory as your customers purchase them from you. A manufacturer or distributor keeps a large inventory of various products in their warehouse and does the shipping for you. However, like any business, working with dropshippers has its share of horror stories so it’s best to do your research and be prepared.
Once you know the types of products you’ll be selling it’s time to start making a list of potential dropshippers. Of course, there’s no reason you can’t work with several dropshippers at a time, each carrying a different line of products; but, it’s imperative that you thoroughly check the reputation, background and references of any dropshipper. There have been many instances of small dropshipping companies setting up shop, only to disappear months later-leaving their customers in a bind. You may be able to find manufacturers that are willing to dropship; however, most times that is only for oversized and expensive products. For most product lines, your best bet will be working with large direct distributor companies who purchase products directly from several different manufacturers-most who have been distributors and dropshipping for years. Typically, it’s not the manufacturers or large direct distributors that are unreliable, it’s the small distributors who are buying from the direct distributors-and all they’re doing is marking up the price!
Narrowing your search for dropshippers
But, rest assured, finding dropshippers is easier than you think. A great place to start will be on the search engines, searching for your product category, for instance, "pet products", and "dropshipper". Be sure to thoroughly research each dropshipper you are interested in by checking references and seeing if there have been any complaints about them to the Better Business Bureau.
After you’ve narrowed down your search to a list of dropshippers you believe are reputable, it will be time to start comparing product prices, dropshipping fees, ease of ordering and billing methods. Product prices will many times be very similar from dropshipper to dropshipper, so your main focus will probably be on fees, ordering system and billing.
Dropshipping fees
Every dropshipper will tack on fees to cover the handling of each order. They might add a flat fee to each order or a percentage fee of order total. These fees are in addition to the actual shipping charges. It would be in your best interest to make a chart using the same or similar product items and see what the actual fees charged from each dropshipper would be.
Ordering and billing
The way you place each order with a dropshipper varies greatly. With some, you will need to phone in or email the order; others may want you to fax it. However, the most convenient of all will be if the dropshipper has an online ordering system. Each order will take just a minute or so to input and many are compatible with Yahoo or other ordering systems so uploading your customer’s order to the dropshipper’s site is instant. Each dropshipper will have their own billing system as well-and don’t be surprised if they require a prepayment to begin. Most dropshippers will bill on a weekly basis, however some bill at the end of the month. You will also need to find out if they take credit cards or checks.
So, while other online retailers may have had problems with a select few dropshippers in the past, you now have enough information to make your search easier. Remember, the more research you do before working with a dropshipper, the fewer problems you will end up having.
Tags: advice, dropshippers, Product Sourcing, source, tips, working with dropshippers
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Published October 30th, 2007
PayPal may be owned by eBay, but a growing number of non-eBay online businesses are Accepting PayPal as payment for their goods and services. But, are they making the right decision?
With more than 100 million accounts, PayPal is one of the most popular online wallets available today. PayPal’s original growth came from the online auction industry, but today many online retailers are using PayPal as a way of accepting payments from their customers. Whether your company is selling products or services, PayPal is worth considering as a way to receive payments from customers.
PayPal’s fee structure:
Monthly Sales /Price Per Transaction
$0.00 USD-$3,000.00 USD / 2.9% + $0.30 USD
$3,000.01 USD-$10,000.00 / USD2.5% + $0.30 USD
$10,000.01 USD-$100,000.00 / USD 2.2% + $0.30 USD
> $100,000.00 USD / 1.9% + $0.30 USD
Before you begin accepting PayPal as payment for goods or services on your e-commerce website, here are some of the pros and cons of using the service:
The Pros of Accepting PayPal:
* It’s fast and easy to set up an account.
* Customers can send payments to you directly, or you can create and send an invoice.
* There are no monthly fees or set up fees - you only pay Paypal on a per-transaction basis.
* It’s integrated with USPS so you can print shipping labels right from the PayPal website.
The Cons of Accepting PayPal:
* PayPal’s Seller Protection policies do not cover intangible goods or goods that are "not as described".
* There is a limit (around $2000) that can be sent in one payment.
* PayPal has built-in security features that will decline cards from certain places.
* Just like with credit cards, customers can request a charge-back. In which case, PayPal charges a $10 charge-back fee.
* Accounts with high transaction volumes can be blocked (as part of their anti-fraud protection).
Before deciding to use PayPal for your business, you might want to also consider a merchant account that will allow you to accept major credit cards directly. You should compare transaction fees and ease of transaction, and also see if there are any set-up or monthly fees with various merchant accounts. Be sure to check with several merchant account companies, as they will most likely have different fee structures and options. You may also want to ask around in various e-commerce forums about good and reliable merchant account companies. There’s a good chance you’ll get some great recommendations from experienced small business owners who are willing to help.
There are plenty of online options for accepting payments from your customers. Paypal seems to be one of the easiest ways to accept online payments but it may also be seen as a hassle if customers aren’t already Paypal members. There’s a chance that some customers will just purchase from another retailer where they can use their credit cards directly - now that’s something to consider.
Tags: E-Commerce and E-Business, Generating More Sales, paypal
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Published October 30th, 2007
With every business, one thing is true: each one of them needs great marketing in order to succeed. This is especially true for home based businesses. There are many different ways to market a home business, and which marketing route you take depends entirely upon your marketing budget. Here are some of the most effective ways to market a home business.
Build a Website
This is a great way to market a business. You are able to do several things with a website including reaching out to customers you may not be able to reach without one. One of the most important things you can do with a website is to build your credibility. By placing "about us" pages and listing your services or products, you get the word out about your company. When you are visible to more customers, you have a better chance of getting more sells or sign-ups. The cost of a website is different depending on where you purchase one from, but you can get a site and hosting for as little as $10 a month.
Place a Classified Ad
This is very useful for gaining local customers. Most people who are looking for a service will look through classified ads at one point or another. Check your local newspapers or trade papers. These are great places to list your business. The price of a classified ad is different depending upon where you live, but the average cost of one is around $10 a week for a basic text ad.
Yellow Pages
Even with the decrease in the use of phone books to find information, having a listing in the yellow pages is still essential. More people search online and through their yellow pages for companies than with any other resource. One great idea is to place a full page ad if budget allows. This is a better way to get the potential customer’s attention. Check with your local yellow page publisher for pricing information.
Direct Mail Marketing
This can be a very effective way to market your home business. When a customer has your company’s name and information right there in front of them, they will be more likely to contact your company than another of the same kind. When a potential customer receives your mail it may even remind them of a service or product that they need. Your direct mail marketing campaign can be as elaborate and reach as wide a base of customers as you want. This will determine the price of your campaign, but you can run an effective one for about $50 a month. For more information on using direct mail, read our recent article Effective Use of Direct Mail to Market Your Business .
Ultimately, your budget will determine what sort of method you can use and to what extent. One of the best things you can do for your business is to define who your target market is. By knowing who your target customers are, you will be able to determine the best marketing plan and save money by only marketing to those you want to reach. You can determine your target market by researching companies who have products similar to yours, or you can research your own existing customers to find out all kinds of information, such as:
* Where they are located
* Gender and age group
* What products they purchase the most from you
Knowing this information will help to hone your marketing strategy and further the success of your company.
Putting together a marketing plan for your home business can be a fun and creative process. Even though you might not have a large budget, there are still lots of great ways to promote your business without breaking the bank.
Tags: advice, home based business, Marketing, marketing ideas, Marketing Your Business, tips
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Published October 29th, 2007
With the end of the year fast approaching, you may be thinking ahead to taxes and what small business write-offs you can use to your advantage. Most likely you know about the most obvious ones (like business computers and equipment), but there are plenty of other deductions you may not know about. The only way you can use business write-offs to your advantage is if you actually know about them. Here’s a list of several that are commonly overlooked by business owners:
Unpaid invoices - You can claim any non-payment from customers as a loss on your taxes. If you have unpaid invoices from years past, don’t worry, you don’t have to take the deduction the year it occurred. So gather up your old paperwork and go ahead and deduct them on this year’s return.
Mileage - You may have heard about this deduction, but are you keeping track? All those short trips to the bank, post office, restaurants and airport add up big time over the course of 365 days. If you start doing it, you will be amazed at how much money you’ll be able to write off. At a 32-cent deduction per mile, these add up very quickly and at the end of the year, it is a real eye-opener to see how much you’re able to write off. Oh, don’t forget tolls either!
Shipping and postage expenses - This is another often-overlooked deduction. Once you see how much everything adds up to, you’ll gladly take that deduction every year!
Your home - If your house is also your place of business you have the right to depreciate a percentage of the home’s total square footage depending on the percentage of your home that is used exclusively for your business.
Utilities - Do you have electricity, gas, phone, etc.? Up to a third of these can be deductible.
Cell phone / PDA bills - If you are using your cell phone/PDA for keeping in contact with business associates, then the cost off your phone and your monthly bills are a deduction.
Business Meals - Any time that you go out for meals or drinks and discuss business with someone (even your spouse) then you can deduct that meal as a business expense. Be sure to deduct the miles it took to drive there and back too!
Travel Expenses - Any time to you travel with the purpose of maintaining or expanding your business (i.e. trade shows, client visits, etc.), the expenses associated with that are deductible. That means hotels, airfare, meals, rental car, etc.
Of course, in all the above cases, you must keep complete records if you are to qualify for the tax deductions. That means receipts or detailed entries (depending on the deduction). Generally, all expenses incurred while maintaining or expanding your business are deemed as tax deductible. To make sure you are getting the proper deductions for your business, talk to a qualified accountant or visit the IRS website at http://www.irs.gov .
Tags: Accounting, Finance, Finance and Accounting, irs.gov, money, small business taxes, tax write-offs, taxes, travel expenses
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Published October 29th, 2007
Some small businesses get into trouble when they try to do all aspects of their business in-house: marketing, advertising, copywriting, data entry, bookkeeping, web design, SEO techniques etc. The problem is that most businesses don’t have a working staff that is skilled in each (or any) of those areas. It makes much more sense to hire a professional who is experienced in a certain field and have them do the job for you. Hiring a freelancer will ensure that the job is done right. Plus, it will free your company’s employees up to do what they really excel at.
It’s never hard to find good, reliable and available freelancers. In fact, there are several freelance websites that allow you to post your job in specific categories where freelancers who specialize in those areas can bid on it. Here are the two biggest and most-respected freelance websites:
www.Guru.com : Guru is the world’s largest freelancer website. There are over 629,000 freelancers signed up with Guru - you’re sure to find at least one of them that meets your needs! There are plenty of freelancer categories to list with and placing a job listing is absolutely free (and incredibly easy).
www.Elance.com : Elance is very similar to Guru. It’s an online workplace that allows businesses to hire work talent on demand. Placing a listing is free and there are plenty of categories to place your job listing in.
There are also plenty of freelance websites that are specific to a job category, like SEO or graphic designers. If you’d like to do a more thorough freelancer hunt, you can just search Google for "SEO freelancers", etc.
As the old adage goes, "You get what you pay for".
Finding freelancers is easy; however, finding a good freelancer will cost you. Placing a job listing on a freelance site is a great way to find out what a fair rate will be for the job you want done. You’re sure to see a wide spectrum of pricing - and, of course, you get what you pay for. Always check a freelancer’s feedback and rating (most freelance websites have this feature) and take a look at their online portfolio if available. Rock-bottom bids are fine if you don’t care about the quality of the job. Just don’t expect a stellar job or even timely results. Freelancers on the higher end of the price range are bidding high because they can. Most likely, they’ve proven their talent to other clients and have the positive feedback and the amazing portfolio to back their bid up.
Hiring a freelancer is easy and it beats placing an ad in the paper and conducting interviews. You can usually feel safe relying on a freelancer’s positive feedback and impressive portfolio for references. Just be sure to set a specific project deadline, otherwise your work might get pushed aside for other, more-pressing projects. When you use a freelancer, there’s no commitment to long-term work and you don’t have to pay for healthcare or vacations. Most freelance sites even have a 1099 service to help you out come tax time. Using freelancers is simple and once you get the hang of it, you’ll most likely end up using freelancers again and again.
Tags: advice, freelancers, Hiring and Human Resources, tips, working with freelancers
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Published October 29th, 2007
Industry experts report, on average, a 70% shopping cart abandonment rate for online retailers. Talk about room for improvement! The good news is that those visitors came to your site for a reason; help them find what they’re looking for and you’ll greatly reduce your rate of non-buying visitors.
What are the main reasons for visitor and shopping cart abandonment?
* Unable to easily find the information they’re looking for
* Site not easy to navigate
* Broken site links
* Site doesn’t seem secure
* High shipping costs
* Products on backorder
* Checkout process is too long
* Checkout requires customers to register or become a member
* Checkout requires too much personal information
* Checkout process is confusing
What can you do to keep visitors on your site and get them to complete the sale?
Remove Member Registration - It’s amazing how many websites halt the checkout process to try and force customers to register as a member, requiring a password and more. Becoming a member of a website should be a choice, not a demand - and it certainly shouldn’t be addressed until after the sale is over.
Show shipping costs and other costs - First, be sure that your shipping costs are reasonable. There shouldn’t be any type of "handling" costs charged on top of that. Also, let customers know if sales tax will be charged. All shipping and tax information should be listed in the first step of the checkout process or even on the product information page.
Build Trust - It’s important to let visitors know how many steps are in your checkout process and to show progress as they go. A progress indicator is commonly located at the top of each checkout pages with the current step highlighted. Also, be sure you provide visitors the opportunity to review previous steps without erasing already-entered information.
Provide purchase options - Not everyone feels safe entering in their personal and credit card information online. Offer customers a toll-free ordering number to place an order with a live person over the phone, if they choose.
Be clear - buying and checking out should be completely easy. Your visitors should feel like their hand is being held through the entire process. They should never be left wondering where to click or how to check out. Make all buttons clearly visible and understandable - this includes the shopping cart itself. If someone places an item into their shopping cart, but they can’t find their shopping cart on the page after that, how can you possibly expect them to make the purchase?
Use a readable and clear font size and color - Be sure that all the text on your website is in a readable font and an easy-to-see color. Fancy fonts are great for headlines and logos, but website and checkout content text should be in a standard font, such as Arial. Of course the font should be large enough to see, with a color and background color that make for easy reading. A light blue font on a white background would have customers squinting their way through your site - good luck getting them to stay.
So, while the website abandonment rate may be high, there are also many things a website can do to lower that rate. Even just applying a few of the changes will surely make a big difference in the amount of visitors that leave due to frustration or lack of information.
Tags: E-Commerce and E-Business, onilne business, shopping cart, shopping cart abandonment, website
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Published October 26th, 2007
There’s no doubt that in the past decade, unsolicited emails have gotten increasingly out of control. To curb this mass of junk e-mail, Congress has enacted the Controlling the Assault of Non-Solicited Pornography and Marketing Act," or CAN-SPAM Act. President George W. Bush signed the bill into law on December 16, 2003 and it became effective on January 1, 2004.
Here are the key points of the CAN-SPAM Act for bulk emailers to follow:
* No deceptive subject lines
* No false or misleading headers
* Must include a clear and conspicuous way to opt out/unsubscribe out of your email list
* Must include a valid physical postal address
Not complying can subject the spammer to stiff criminal penalties of three years in prison for a first offense and five years for a subsequent offense. For a more detailed rundown of the CAN-SPAM act, you can go to the Federal Trade Commissions website and learn more: http://www.ftc.gov/bcp/conline/pubs/buspubs/canspam.shtm
When putting together an email campaign for your company, you should take the above CAN-SPAM points into consideration as well as other customer-comforting additions such as:
Don’t Share Customer Email Addresses - It’s bad business practice to sell or give a customer’s email address to a third party. Some companies are in the practice of selling emails to list companies or trading their own list with another company’s. It’s unfair to your customers and if they trace the source of their new flow of emails, they will undoubtedly never consider doing business with your company.
Confirm Every Subscription -The best way to ensure that only interested parties are receiving your emails is to have a double confirmation (or "double opt-in"). With this method, a company sends an email to new subscribers requiring them to click on a confirmation link, at which time the new email address is added to the list. Subscribers who do not confirm their email addresses are not added to the list and will not receive further communications from you.
Avoid the "Negative Opt-In" - This is when a company pre-checks a box that automatically has a person agreeing to receive emails in the future. A company’s opt-in subscription box should be clearly visible and un-checked, making sure that subscribing to your list is an intentional act.
Identify Yourself Clearly In Every Message - To be completely clear to your subscribers, your company name should appear in the both the sender and subject line of every email you send out.
For email campaigns, if your end goal is to eventually sell something to your subscribers, then it’s best to make them feel comfortable and trusting of your company. Take a look at how some large and reputable companies (like Microsoft, Apple or Amazon) structure their emails and learn from their techniques. There are billions of scam emails being sent out each and every day, it makes good business sense to distance yourself from these illegitimate con artists as much as possible. A proper email campaign should be beneficial to your customers and something they actually want to open and read.
Complying with the CAN-SPAM act is simple, but making your campaign really effective means going a few steps further and making your emails a win-win for both you and your subscribers.
Tags: advice, CAN-SPAM, E-Commerce and E-Business, email campaign, email marketing, Marketing, Marketing Your Business, online marketing, tips
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