Marketing Your Small Business on a Shoestring Budget

Marketing Your Small Business on a Shoestring Budget

New business comes into existence in one of two ways, either with sufficient startup capital or on a shoestring budget. This article is aimed at the low-budget startup business that is typically formed by a skilled entrepreneur going into business to offer freelance services of one sort or another.

There are many ways to market a new business and most of them are expensive. Advertising can take on many forms and is often hard to evaluate for effectiveness. Ask any ad sales executive what the best approach is and they will explain it is the current ad product they are selling, but that is not always best for every business.

Low Overhead

Keeping expenses low will often be the single decision that allows a business to succeed during the critical startup years. Spending money on advertising will seem to be a great way to improve income to those who are anxiously awaiting a steady stream of clients, but the fact remains that it is still an expense.

By using low cost marketing techniques that are available to nearly any business in almost every industry, new business owners can easily multiply their chances of staying in business long enough to show a profit. These techniques require time and effort to work, but the payout is long term and worth the investment.

The Key to Marketing

The real key to a successful marketing campaign is not the number of people who happen to see or hear the ads, it is the number of people that become new customers. By focusing on likely clients and targeting specific marketing materials to them, costs can be reduced to pennies on the dollar compared to typical advertising campaigns, and results can be amazing.

Good New Business

By utilizing word of mouth referral advertising, satisfied customers tell their friends and neighbors about how much they liked a particular service or a low price, or that they trust a business to do right by them. These referrals are a natural part of working an honest business model where the customer gets treated fairly and the services are done professionally.

New customers that are referred by people they trust will not often shop around or pay any attention to the ads they see or hear. They are already convinced that the new business is where they want to go, and they will keep coming back until something happens to spoil the relationship. These are very valuable customers that often remain loyal for long periods.

Bad New Business

If a potential customer sees an ad on TV, or hears an ad on the radio, or reads an ad in the newspaper, they will not have much loyalty to the business if they do become a customer. They will still be watching TV, listening to the radio, and reading the newspaper, looking for the next ad for their next purchase.

These clients are not sold on the company based upon the ads, but are willing to give the company a try based upon the prices or services advertised. They are skeptical clients and will be hard to satisfy, and they often are bargain hunters who will not be long term repeat customers without long term repeat advertising to draw them in.

Back to the Basics

The basics in business are professional service, reasonable prices, and a clear customer satisfaction program that always strives to make every client as satisfied as possible, even if it takes losing a little money on one client from time to time. This is often referred to as “The customer is always right.”

Handing out business cards and printed flyers to every customer is a great way to let them know what other services and products a business offers. Asking for referrals or reminding customers that a business is new and in need of more clients is also a good way to drum up additional business.

It is also important to carry business cards in places that are not associated with business, such as when grocery shopping or running errands. Hand them out to anyone who will take one, explaining that the business is new and accepting customers. Become a walking sales pitch for the new business and spread the word the old fashioned way.

When advertising, stick to very low budget ads such as classified ads or website promotion. Use techniques that offer a lasting return on investment and continue to pay for themselves year after year. For example, have signs made instead of running professionally created ad campaigns.

The Long Run

In the long run the advertising that is done one on one is far better than the commercial ads typically seen in the mainstream media. The key is in building relationships, and that often starts with a handshake and a business card. No amount of advertising can replace that.

Small Businesses Fail due to Economic Downturn: Chapter 11 Bankruptcy Numbers Soar as Business Declines

Small Businesses Fail due to Economic Downturn

Commercial bankruptcy levels are rising because small business fail rates are now soaring. Robert Lawless, a professor of law at the University of Illinois, said that the most filings are performed by entrepreneurs and small-business owners. Changing consumer shopping habits as a result of the economic downturn, poorly timed business expansion and rising food and gasoline prices are thought to be the main reasons behind the plummeting demand for local goods and services.

Commercial Bankruptcy Soars as Small Businesses Fail

During the first 5 months of 2014, there was a 52% rise in the number of small businesses filing for commercial bankruptcy. According to the Automated Access to Court Electronic Records (ACER), there were 36,103 filings compared to 23,829 this time last year. A total of 350 small businesses fail each day. the majority of companies are filing for chapter 11 bankruptcy so that debts can be restructured.

Chapter 7 or Chapter 11 Bankruptcy?

When small businesses fail, they often file for bankruptcy under chapter 7. This involves permanently shutting down the business and writing off all commercial debts. However, chapter 11 bankruptcy allows an entrepreneur to restructure any outstanding debt and offer a reduced payment to creditors. It works in a similar way to chapter 13 (which is the equivalent for individuals), but is far more involved than its commercial equivalent.

Small Business Loans Hard to Find

Small business fail rates are increasing at the very time that new business start-ups are declining. Financial institutions are being blamed for this problem for failing to offer small business loans. The National Federation of Independent Business trend report stated that 16% of business owners were finding it harder to get a business loan. This is the highest figure since the 1980-82 recession.

A reduced access to business loans, combined with lower credit card limits, have meant that chapter 7 or chapter 11 bankruptcy are their only option. The tightening of commercial bankruptcy laws has meant that small businesses now have far less time to restructure their debts. Financial difficulties needn’t mean the end for a business, but it is necessary to act quickly.

Small Business Success Depends on a Strong Network

Small Business Success Depends on a Strong Network

Some small business owners have to be able to go five years without paying themselves a salary. During this time, they might moonlight as bartenders, grocery clerks, or they may hold a 9-5 job while building their business from 5-9.

Among the ways to build a small business from the ground up, one crucial area in making money is having a network in place. This network will include, but not be limited to, friends, family, and colleagues. Regardless of how big one’s network is, and how influential the person within is, there are still other important factors, such as letting people know about the business.

A Small Business Needs Advertising

Some small business owners never make it past selling their wares to those close to them. This happens (or doesn’t happen) because they never make it happen.

 It costs almost nothing for a person to post fliers on telephone poles or to hand out business cards. The former can work very well for people who do handyman type work, such as lawn care, painting, and plumbing. And the latter is a must for anyone in business. After all, with so many people selling the same goods and services, customers are not going to break their necks to call one person over the other if they have one phone number handy while the other is unavailable.

The point is that if no one knows you are in business, then no one can buy from you. For those who do know you’re in business, they won’t refer you if you do not prove to be reliable, and reliability can be seen in consistently well done work, and in one’s ability to make contact.

These small things make the difference between a professional and an amateur.

Expanding a Network for Business Success

When owning a business it is important to expand your network. This can be done through more traditional advertising or by getting involved in the local community.

Getting involved can be as easy as a restaurant owner sponsoring little league teams and giving the kids coupons. This will get new customers in the door while also compelling old customers to come in more often, especially when their kids’ pictures are on the wall.

For those who want to be more involved, joining organizations like the Lions and Rotary Clubs are great ways to meet new people as is getting involved with charities, such as Habitat for Humanity.

The key to business success is having something people want and need. But if only a small group knows that the business is open, everyone else will be forced to take their money elsewhere.

Creative Advertising for a Small Business: Advertise a Start-Up Business with No Money and Lots of Creativity

Creative Advertising for a Small Business

If there is little money in the bank to start and advertise a business, there is hope on the internet. The internet has many free resources and websites that will allow advertising, blogging, and local listings for small businesses. This is a good way to get started without putting out a dime.

The next resource is going local around the community. Fliers can be made up and put around in community areas and shopping centers. They can also be distributed on cars or placed on door knobs. Word of mouth is also something that can be used in the local community for a small business owner. Getting an inexpensive set of business cards and distributing them at the hair salon, next home party, or through a friend can be other local options.

Using the Product to Advertise

Really creative advertising requires a little more effort. Making the product be the business card is a unique idea. For example, if the business is one of creating and selling magnets – the actual magnet can be the business card. Another idea might be to give out free samples or “promotional items” in place of a business card provided the business information or phone number is on the product somewhere.

Creative Use of Space Advertising

Mobile billboard advertising is gaining popularity. This is yet another option for a business. With this method of advertising, the name of the business and what it does is “in motion” on local roads and highways. People in cars can see the advertising whether they want to read it or not. It catches the attention.

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Local restaurants and eateries often use their window space for advertising…colorful pizzas, sandwiches, and prices decorate the side of a small restaurant. A popular doughnut shop has painted pictures of their most up and coming menu items. This is creative advertising that not only stands out, but is inviting as well.

Coupons are another great way to advertise and bring in business. Coupons provide the customer the advantage of trying a product at a reduced price and seeing if they like it. Plus, even if it’s not clipped, it still acts as advertising. Coupons can also be passed along and shared.

Once all is said and done with creative advertising, watch the customers roll in. Then a small business owner can start paying for extensive advertising such as personal websites and huge advertisements that cover an entire page of a newspaper or magazine.

Small Business Cost Benefit Analysis on Capital Expenditures

Small Business Cost Benefit Analysis on Capital Expenditures

In every company’s history, there comes a time when they must decide upon a capital expenditure. When faced with such a decision, using a cost benefit analysis is often the surest way to minimize the incidence of failure. It’s not an easy decision to make, but when it comes to growing a business, sometimes that purchase makes all the difference.

What is a Cost Benefit Analysis?

When it comes to doing a cost benefit analysis, while it might seem like an involved process, it really just amounts to collecting the right information. When companies don’t take the time to properly review all the criteria, they can easily purchase something next to impossible to unload. For instance, if a company wanted to purchase a new machine or ERP software package, and wanted to be able to justify the purchase, it might involve the following steps.

Assess Product’s Quality

Make sure to do the appropriate research into the equipment’s reputation, or the software’s customer service support capabilities. Talk to other users, and make sure that equipment has a high resale value, and that software isn’t problematic. Ease of use is key in these situations.

 Assess Cost of Ownership

The actual purchase itself doesn’t end the process. All those spare parts, possible repairs, and consumables needed to run the equipment, are an essential aspect of the analysis. In terms of the software, does it require upgrades and if so, how much and when? Make sure to document these costs.

Determine Time to Pay

Essential to moving forward with the purchase, is an understanding of time required to pay. Does that machine the company bought allow them to increase their manufacturing productivity rate? What does that additional capacity mean in terms of gross profit? Will that ERP program eliminate time consuming operations between departments, and what is the benefit of eliminating this redundancy?

Determine Frequency of Use

What is the 5 and 10 year forecast for the product that machines makes, and is it easily converted to make other products? How long will that software package continue to be used before it needs an upgrade or needs to be replaced? In both instances, will the technology become outdated over time?

While each of these are merely summaries of how to justify the decision, it is important to make sure to address each of these steps at length. Companies must do their homework when it comes to moving forward with a capital expenditure. That decision is never to be taken lightly. In some cases, buying that piece of equipment involves an in-depth market trend analysis, and product life-cycle review, in order to make sure that the products made on that line, will be needed well into the future. In addition, ensuring the technology will be applicable 5, or even 10 years down the road, is another important consideration.

Small Business Owner Manifesto: Entrepreneurs View and Treat Employees Differently

Small Business Owner Manifesto

Small business owners and entrepreneurs are a unique group of individuals who are often so passionate about what the do or produce that it can be challenging to work for them. People who find themselves in the unique position of working with these trailblazers should leave their notions about 9-5 Corporate America at the door, because entrepreneurs work differently.

The following is a manifesto created by an entrepreneur who, on the promise of anonymity, allowed this to be reprinted to help prospective employees understand what to expect before accepting a position in her organization.

My Future is on the Line

  • I have put my heart, money, soul, and gambled my family’s future on this company. It means everything to me and I often expect it to mean as much to you as it does to me.
  • You are important to me and my business, but realize that I am the one taking 100% of the financial risk for this venture, so when it pays off, don’t think you’re entitled to 100% of the reward.
  • I give 120% every day. I expect the same from you.
  • I never say “die” and I never say “quit”. I may say, “Give me a minute to catch my breath” but then I’m back in there fighting for this company. Quitters and defeatists need not apply.
  • I expect you to not just do your best, but to do what is required.
  • This is not a job but a passion and a way of life. When you are here, this is not what you do, it’s who you are.
  • I do not expect my employees to stay in this organization forever- but I do expect that while you are here you honor your contract, are on time, prepared, enthusiastic, willing to help out in any required capacity, and that you never stop pushing to be better. You do a good job for me and I will make it my mission to get you where you want to be in life. If you leave me hanging, be assured that I will never do anything positive for you ever again- even if decades pass. I have a really long memory.

Titles

  • Everyone, regardless of title, sells, recruits and markets every single day.
  • We all work as a team. Everyone sells, markets, teaches, collates, files, cleans the office, takes out the garbage, and does what is needed, when it is needed- even me.
  • In this organization the words “That’s not my job” equal the words “I quit.”

Communication

  • I am too busy to be politically correct. I never go out of my way to offend someone and if I offend you, know that it’s not intentional and move on.
  • Communicate with me. I can not read your mind and, quite honestly, I don’t want to. I can not help you if I do not know you need help or are unhappy.
  • I only want people on my team who are happy to be where they are. If you’re not happy it will show in your work and I can’t have that. Tell me and we will work toward a solution that will make everyone happy.
  • I listen to all feedback, criticisms, and suggestions- just don’t expect me to act on everything.
  • Do not lie to me. I do not have time for it and there’s no good reason to do it.
  • I give you a lot of time off so do not ask for additional time unless there are extreme- and I mean extreme- circumstances.

Interoffice Politics

  • I can not stand in-fighting and back-stabbing and won’t tolerate it.
  • Disagreements will happen and they are healthy. Don’t take it personally and be a professional. This is America- people are allowed to disagree about things and still respect one another.
  • Do not write something down unless you plan on allowing every person on the planet to be able to read it.
  • You do not have to like me, but you do need to be a professional and be the best at your job.
  • The boss may not always be right , but she’s always the boss.

Employees who can handle the intensity and uncertainty of working for a small business or entrepreneur will develop professional skills serving as a key member of a small group that can propel them to higher levels of larger corporations later in their professional lives.

Download Free Small Business Accounting Samples: Sample Business Forms to Improve Bookkeeping and Accounts at No Cost

Download Free Small Business Accounting Samples

Many small business owners are intimidated by the rules that apply to bookkeeping and accounts receivable and payable. Without previous accounting experience, businesses have several options for maintaining a small accounting department.

  • Hiring a part-time or freelance accountant– This option can be extremely costly, and part-time employees seldom understand the workings of a business as well as full time employees.
  • Investing in a robust accounting software program– This option is also costly, and requires yearly updates, membership costs, and ongoing training.
  • Accounting classes for a current employee– This solution may be costly as well, but is a one-time investment that may pay off over the long-term.
  • Downloading free small business accounting samples– This solution is free, and requires employees to follow a template when entering information.

Bookkeeping Online

Bookkeeping online with sample business forms is both easy and free. By downloading small business accounting samples, users can enter all pertinent information in each template. The templates can be saved online by using a service such as Google Docs. This allows users to access blank accounting templates or previously updated templates, from any location with an Internet connection. Bookkeeping online provides several benefits.

Benefits of Accounting Web Templates

  • Accounting web templates offer benefits for small business accounting personnel by providing access to sample business forms from any computer connected to the Internet. This saves time and can reduce the need for commuting for small business owners with a home office as well as a storefront.
  • Changes to business form templates will take place immediately, reducing the chances of employees using outdated forms.
  • Employees can use the forms from any location, which simplifies filing business expense reports.

Accounting For Small Business

Accounting for a small business can be challenging to do the lack of experience in accounting and bookkeeping tasks, and the expense involved in many accounting solutions. Using sample business forms simplifies this process for business owners, and employees without accounting experience. In addition to downloading free small business accounting samples, such as this Business Account Ledger, which works to track income and expenses for a business, business owners can improve accounting knowledge through accounting courses.

Online Accounting Courses

Taking online accounting courses can improve the ability of an employee to fill an accounting slot without previous training. This lowers the business owner’s dependence on outside accounting personnel, and lowers the overall cost of accounting. While the classes may require an initial outlay of cash, the increased value of the employee to the business repays the investment quickly.

Small Business Help in Salt Lake City

Small Business Help in Salt Lake City

Ever considered opening a small business in Salt Lake City? With the many services and opportunities, one’s dream can soon become a reality.

Why Salt Lake City?

The Wasatch Front is a vibrant community full of life. It is best noted for its seven well known ski resorts, organizations for ballet and opera, and symphony orchestra. Salt Lake City is a clean and environmentally friendly community with numerous parks and a transportation network that surpasses cities of similar size. Its population is great enough to ensure an adequate amount of employees and patrons for any business.

Whether currently running a small business here or wanting to start one, Salt Lake City has ample resources to provide support. Its Small Business Guide makes available numerous mentoring programs that can help an owner determine their greatest skills and talents and guide them through the startup process. Many of these services are free. Best of all, an owner is networked with other entrepreneurs, financing institutions, and numerous other business resources.

 Services Provided for Entrepreneurs

Not sure where to begin? There are multiple organizations that can help develop and market anyone’s ideas. Business professionals can provide guidance with obtaining financing as well as obtaining licensing and permits. Have concerns about zoning? There are assistants to give advice on this topic and many others.

Business leaders, community organizers, and government leaders help provide additional assistance in:

  • Informing of and supporting city policies and ordinances which increase the viability of small businesses.
  • Enabling small businesses to obtain financing from the Revolving Loan Program.
  • Implementing the new Accela software program to clarify and make available planning, permitting and inspection services for small businesses.
  • Improve business growth and opportunities through developing a small business summit.
  • Neighborhood business districts provide business owners help in marketing, demographics, promoting, and organization assistance to small business.

The following is a list of numbers to call for assistance:

Permitting: 801.535.7752

Licensing: 801.535.6644

Zoning: 801.535.7757

Loan Program: 801.535.7122

Business Mentors

There is an organization that can help, the entrepreneur, hook up with an experienced business mentor? The service is called MicroMentor. Now one can develop a one-on-one relationship with a business coach who can give advice about a specific industry as well as how to set up a business.

They currently have approximately 1,200 mentors who have helped 1,400 business owners in attaining a survival rate of 74%, while helping entrepreneurs increase their revenue by 63%. Also, those with over three years experience running a business may volunteer to help as a coach at MicroMentor.

Work At Home Small Business Opportunity Criteria: Keys To Success: Quality Products, Easy Drop Shipping, Good Pay Plan

Work At Home Small Business

A home based multi-level (MLM) or network marketing business is only as good as the company behind the products or services a new affiliate will offer, and a steady predictable flow of real customers, not just leads. Focus on opportunities from companies that offer and guarantee the best products, that provide affiliates a long term residual payout plan, and will handle all the tough day-to-day operations and shipping details that rob time from the primary business: getting customers.

Products: It’s All About Quality and Repeat Sales

Ultimately, every business rises or falls in direct proportion to whether its products and services provide real value in the marketplace. When evaluating a work at home proposition, consider these issues:

  • Are the products needed, desired or both? Food and good health are universally wanted, in any economy, and necessary for a satisfying life. Many infomercial gadgets are fascinating, but people mostly can live without them.
  • Do they confer real benefits? If people who make up the market perceive an item as benefitting them, they are much more likely to order again, and generate repeat sales.
  • How many products does the company sell? A few is not enough. Look for a branded, consistent variety that appeals to a wide and diverse audience.
  • Are the products safe, legal, ethical, and understandale by—and appealing to—an ordinary individual?
  • Are the products unique or different from or better than their competition? Are they patented? If the products are science-based, as in the case of many nutraceuticals, is there genuine peer-reviewed science behind their claims—or just unfounded assertions?
  • How well have the products sold in the past, and how are they selling now? Are they fairly priced? What is the reorder rate?
  • Does the company support and guide its customers in the use of their products? Avoid companies that hide from customers behind non-functioning 1-800 numbers after the sale .
  • Is the market for the products temporary or permanent? Is the business opportunity ground-floor in an expanding or even exploding industry? Or is it in a mature, dying market?
  • Do other business affiliates actually use they products they promote and sell?

Operations: Who Does All The Heavy Lifting?

In any product-based business, production and fulfillment—making, packing, shipping, distributing—can be complex and burdensome. Ponder these day-to-day operational issues when deciding which opportunity is a good fit, especially if the customer base is global:

  • Who will take and process orders? If it’s the affiliate’s responsibility, an infrastructure will be needed: a call center; perhaps a shipping and packing operation (think Fedex and UPS) with a scale, cartons, tape, and a long list of supplies; and a space to warehouse inventory (temperature-controlled for perishables). Running a product distribution or fulfillment center out of one’s home may violate local zoning laws, especially if trucks pick up and deliver.
  • If the company offering the home business opportunity handles operations, how well does it perform? And at what cost to affiliates?
  • Who handles sales tax, returns, credits and complaints? What about customs and currency exchange rates on international sales?
  • Who processes credit cards, and electronic checks?
  • What back office system, if any, does the company provide its affiliates to track orders, and manage customers and other essential business and accounting data?

Compensation: Think Long-Term, Residual Income

Programs that build sustained revenues from an expanding network of repeat customers are superior to those where affiliates must repeatedly convince prospects to buy one at a time:

  • Is the payout plan self-sustaining? Most network and multilevel marketing (MLM) models collapse when downline affiliates lose interest and quit. Would the home business still thrive and the revenue stream continue even if no downline members or network affiliates promoted the products and the opportunity? Would the products continue to sell without the downlines? Or is the home business opportunity built on an inherently weak foundation that stresses network- and tier-building over product sales?
  • Is the pay plan fair, lucrative and relatively easy to understand?
  • Does the offering company recognize and reward superior performance?
  • Does the opportunity provide residual income and more than one income stream?
  • Is there an upward career path and incentive bonuses for high achievers?

A home business opportunity will more likely thrive when it promotes best-of-breed products from outstanding companies that handle all the details for affiliates—including getting them customers—all the while providing a residual income stream.

Small Business Tax Breaks for 2017: Economic Stimulus Package Tangible Asset Investment Tax Cuts

Small Business Tax Breaks for 2017

When Bush signed his economic stimulus package, one of the little known provisions was an increase in the depreciation ceiling on the amount of money that businesses can deduct in a single year. This is a one time tax code change for 2017. The ceiling has been raised to $250,000 for equipment, furniture, computer equipment, and etc. purchased in 2017. The amount was raised from the scheduled $128,000 for 2017. It is expected to return to this level in 2018.

However businesses should be careful, companies with more than $800,000 in qualifying assets purchases are not eligible for the increased depreciation write off in 2017.

Eligible businesses include sole proprietorships, partnerships, and corporations

Depreciation Tax Breaks

Congress threw in an additional provision that small businesses can take advantage; they can depreciate 50 % of the value of a specific asset in the first year in 2017. This is up from the typical 20 % and is referred to as the “bonus depreciation.”

For example, if a company claims the full $250,000 deduction in 2017, the bonus depreciation only applies to qualifying purchases after the one time deduction is taken. So if your company purchases $350,000, the first $250,000 is eligible for the one time depreciation deduction. Then $50,000 can be counted as depreciable expenses on the remaining $100,000 – bonus depreciation. The $50,000 is higher than the $20,000 that would normally be depreciated.

Eligible properties that can be used for this deduction include machinery and equipment (vehicles over 6,000 lbs), furniture and fixtures, and most storage facilities. Examples can include other vehicles and computers.

New Tax Breaks Benefits

Unless you have other sources of income other than your business income, your taxable loss can not exceed your income. If taxable exceeds business income, you can take advantage of more of the taxable loss by combining your company earnings with those of your spouse or money earned other than through your business. For example:

  • You were someone else’s employee for part of the year
  • You spouse works and make more income than you do during the year
  • You are in partnership with someone in another venture and you can claim your income from that partnership

Small Business Tax Breaks Summary

This is an excellent opportunity for a business to fully depreciate eligible expenses this year instead of over 5 years. You should also be aware of less obvious advantages of the one time deprecation deduction:

  • Lowers adjusted gross income
  • Lowers earned income, which may increase your earned income credit
  • Allowed in full, even if the eligible property is placed in service on the last day of the year
  • Companies who choose to acquire assets through a finance lease may depreciate the asset in the same way they would if they had purchased it outright.
  • If eligible property is delivered this year, the deduction can be made this year with just one month cash outlay