Zuzana Business

Archive for the ‘Small Business’ Category

So, you’ve decided that the Internet has a lot to offer you by the means of starting your own small business. So what is it that you have to do first?

Well, what type of small business is it that you are going to start? After you have figured this out, whether it is an information site or selling products online, you might need to go to the many different Internet advertising sites that will help you generate traffic to the your new Internet small business.

The next step, may be to decide what products you are going to have on your small business web site. This way you have an idea as far as the inventory and other information you will need. Building a web site for your small business.

There are many web sites available to help you as far as promoting your small business such as adverting sites and marketing sites as well.

When starting a small business on the Internet you’ll want some means of getting visitors to your site, this being said the advertising company you go with should be a reliable one. Once again, you can do the research and find many different advertising agencies as well as web sites that can help you with this.

Usually small businesses that start out on the Internet without the help or support of any kind of advertising, marketing or helpful tools will not last very long and you will soon find your small business on the Internet suffering, if not being taken off of the Internet completely.

Some Internet small businesses have tried this and it does not work. However, if you know what type of Internet small business you want, then you start researching on advertising and marketing and getting visitors to your site, such as generating traffic in other words; your small business on the Internet will have a better chance of surviving. And in most cases, prospering to the point that your small business on the Internet has grown tremendously.

It is not impossible to start a small business on the Internet while some people may tell you that it is. You simply have to know the right techniques and have the right tools concerning the Internet at your disposal. This makes it so much more easily to start a small business on the Internet and at the same time making it a productive one, that will last.

Advertising plays an important role in generating traffic, or visitors to your site, while the marketing portion, assists you in setting up the means of the visitors who want to purchase things off of your small business on the internet to do so.

Make things as easy as possible for the visitors that come to your small business as well, in this case they may very well be returning customers.

Many Internet small businesses will start out with very few products on their site, however as time goes by, and if done in the proper way of management the site will grow along with your inventory as well as the profits. The visitors to your site will increase too. Remember, do research and don’t just throw an idea on the Internet building a web site to sell things. Think it out first, what you want to accomplish with your small business on the Internet, and then do the marketing and advertising parts next, therefore generating traffic to your new small business web site.

If your business still does not have a merchant account that allows you to offer full credit card services, you are turning your back on profits. Just take a look at all of your competitors. All of those that pose serious competition accept credit card payments. Those that do not have credit card services do not have great sales figures to show, either. Even statistics point to the fact that companies that have credit card services earn much more than companies that do not have credit card services. The average credit card sale is $40 while the average cash sale is only $9. That means you are losing potentially $31 per sale.

You may also be spending more by accepting only cash and check payments in your business. The processing of cash and checks has been found to be more costly, requiring more manpower in handling. Studies have shown that the average processing cost of credit card payments is only 2.7% of a transaction while the average processing cost of checks is 4% of a transaction and the average processing cost of cash is 4.8% of a transaction. Once again, you are leaking profits by refusing to accept credit card payments.

So how do you accept credit card payments in your business? This is where credit card services come in. The old route is to apply for a merchant account in a bank. You will then have to lease the software and equipment necessary to actually process payments and send the data to your account. If you want to accept credit card payments online, you need to apply to a payment gateway that allows real time credit card authorization for online transactions. You should ensure that your payment gateway is compatible with the bank or financial institution where you have your merchant account, and with the software and equipment you have leased.

In choosing the bank or financial institution for your merchant account, consider their expertise in combating fraud and reducing chargebacks. Also make sure that they are experienced in handling merchant accounts with online transactions.

If you are a small business owner, stick to a bank or financial institution that caters to small businesses rather than large companies. You may be able to get better rates and packages designed for your specific niche.

There are options for credit card services that offer everything you need in one easy package. You will not have to deal with various entities or go through various procedures. Often, these options also have added benefits, among them, quick reporting on your credit card sales figures. They may also offer interest on your credit card sales income, even up to money market rates.

One very important feature of your credit card services that you may not know of is that it can automatically qualify you to avail of small business loans. Once you have established a record of sales through credit, most credit card services will allow you to make cash advances that are practically like getting previously approved small business loans without having to put up any required collateral. The credit card services consider your future income through credit card sales as your collateral. This can go a long way in further growing your business.

Payment will not be a problem, either. For as long as you have sales through credit payments, you automatically get to pay your small business loans. It does not matter how much your sales are. Your payments are automatically deducted as a percentage of your sales. You are always covered.

Now do you still need further convincing on the benefits of credit card services for your business?

Since June 15, 2009, the United States Small Business Administration has been processing deferred payment small business loans of as much as $35,000 to be given out to 10,000 small businesses. This is covered by the SBA’s America’s Recovery Capital (ARC) Loan Program.

To qualify, companies should be private enterprises that are for-profit. They should have up to five hundred employees only and should be at least two years old. Furthermore, they should be able to prove financial need with a twenty percent decrease in sales, revenue or working capital. On the other hand, they should be able to prove that one of their two years in business has been profitable, and that with the infusion of cash they will be able to meet their existing and future debt obligations. This means positive cash flow projections. The ARC small business loans are intended to be used to pay outstanding debt such as payables to vendors.

For this batch of small business loans, there are no fees or costs involved, except if the borrower defaults on the loan later. In that case the SBA-approved lender can charge costs for securing and liquidating collateral.

The ARC small business loans also do not charge interest. Actually, the SBA pays the interest for the borrowers. Disbursement of the loan can take as much as six months but payment of the principal is also deferred for the next 12 months. After that, the borrower has five years to repay the loan principal.

Each small business can only avail of one ARC loan. SBA-approved lenders will offer the loans until September 30, 2010 or until available funds run out, whichever comes first.

There are, however, an estimated 30 million small businesses in the United States and only 10,000 of them can avail of the government’s small business loans. What if you do not happen to be among the 10,000 lucky recipients? How will your small business survive?

There are even doubts being raised on whether as much as 10,000 businesses can indeed avail of the ARC loans. There are fears that there may not be enough lenders willing or able to participate in the program. Lenders will have to advance the full amount of the loan, will not receive payment on principal for a full year, and will not be able to charge any fees, thereby absorbing all administrative costs. This may be too steep for many lenders. They may not be able to afford to participate at all.

This is where you as a small business owner can and should maximize your credit card services. We are not talking about your personal credit card services here. Instead, we are referring to the merchant services that enable your small business to receive credit card  and debit card payments. Surely, any business these days avails of these types of credit card services. After all, more people pay by credit card or debit card rather than cash.

Most credit card services offer small business cash advances that can be as substantial as small business loans. These small business loans do not require any collateral because they are secured by your company’s future credit card receivables. This is even more convenient for your business because repayment is also built into those receivables. Credit card services automatically deduct a percentage from your income to go toward loan repayment. For as long as you have incoming sales, you can support your loan. Interest rates are often quite affordable considering how the loan can help your business.

Small businesses should therefore look into maximizing these credit card services for small business loans. The survival of your business could hinge on this.