small business owner http://www.wisebread.com/taxonomy/term/10862/all en-US Can't Get Business Credit? Consider Alternative Financing http://www.wisebread.com/cant-get-business-credit-consider-alternative-financing <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/cant-get-business-credit-consider-alternative-financing" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/at_my_garden_store.jpg" alt="At my garden store" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>In an ideal world, you'd be able to turn to your banker or business credit card to borrow money any time you needed it for your business. But not everyone has a long enough credit history or a high enough credit score.</p> <p>If you're losing sleep because you need cash quickly and traditional sources are not working out for you, it may be worth considering alternative financing. The interest rates and fees can be significantly higher than for a traditional bank loan or on a great <a href="http://www.wisebread.com/the-5-best-credit-cards-for-small-businesses?ref=internal" target="_blank">business credit card</a> deal, but they can come in handy in a cash crunch.</p> <p>Here's a quick crib sheet to help you determine the right type for you. (See also: <a href="http://www.wisebread.com/10-smart-ways-to-get-a-small-business-loan?ref=seealso" target="_blank">10 Smart Ways to Get a Small-Business Loan</a>)</p> <h2>Take stock of industry-specific options</h2> <p>If you work in a field such as ecommerce, look into lending programs tailored to your industry or the platforms where you sell your products or services. One example is the Amazon Lending program, an invitation-only program for merchants who run Amazon stores, which helps them finance inventory.</p> <p>Often programs like this are tailored to the cash-flow quirks of particular industries. If you're not aware of lending programs specific to your industry, ask your trade association for ideas.</p> <h2>Consider factoring</h2> <p>In factoring &mdash; a type of financing that is often used by companies that sell merchandise through big retailers &mdash; you sell your accounts receivable to a company called a &quot;factor&quot; at a discount. In one common type of factoring, the factor buys your invoices and purchases the right to collect the money owed from your customers. Once your customers pay their invoices, you get the face value of the invoice, with a small discount subtracted, often in the neighborhood of 2 to 6 percent. The factor will give you 70-90 percent of the value of the invoice up front, and the rest when the customer pays it.</p> <p>One reason some small-business owners like this type of financing is the factor bases the decision to buy the invoices on their customer's credit, not the business owner's. For instance, if you make a household gadget that a big retailer has stocked on its shelves, the factoring company would decide whether or not to buy the invoice based on the retailer's credit, not yours. That could be a plus if your credit profile is not strong.</p> <h2>Borrow against your receivables</h2> <p>Another type of financing that may come in handy is borrowing against your receivables, particularly if you run a professional services firm. If you use popular accounting software programs such as QuickBooks, Freshbooks, or Xero Accounting, you may be able to borrow against your receivables through Fundbox.</p> <p>Fundbox will let you borrow up to $100,000 against your receivables and repay the loan over 12 or 24 weeks. You can figure out what it will cost you using the <a href="https://fundbox.com/pricing/" target="_blank">calculator</a> on the site. You must pay back the loan each week in a preset amount (part of the amount owed, plus a fee) for the duration of the repayment period.</p> <p>You don't need a credit check or personal guarantee, approvals can happen in a matter of hours, and you can get the loan as soon as the next business day once approved.</p> <p>The challenge with this type of financing is that Fundbox automatically deducts the money you owe from your business bank account. If money is flowing into the business slowly, you could end up in a period where you have very little cash on hand until you repay the loan.</p> <p>If you're going to go this route and aren't sure if you'll have enough free cash to run the business during the repayment period, do a cash-flow projection with your accountant to be sure. As in all financial matters, it's important to understand what you're taking on. (See also: <a href="http://www.wisebread.com/how-to-pull-your-small-business-out-of-a-cash-crunch?ref=seealso" target="_blank">How to Pull Your Small Business Out of a Cash Crunch</a>)</p> <h2>Try an alternative loan</h2> <p>A working capital line of credit from an alternative lender is another option that might help you in a pinch. At <a href="http://www.kqzyfj.com/click-2822544-11145625">Kabbage</a>, one fast-growing provider, small business owners can apply for a credit line of up to $250,000. Kabbage offers six-month and 12-month repayment terms. Each month, you'll pay a fee of 1.5 percent to 10 percent, based on your business's performance. For example, if you borrowed $10,000 for six months with a 4 percent monthly fee, you would pay $1,667 each month for the loan repayment, plus $400 a month in fees.</p> <p>Peer-to-peer lending (aka, P2P lending) is also an option. You can borrow money from investors, who may be institutional funds or private individuals, instead of going to a bank. Among the providers are <a href="https://lending-club-smb.sjv.io/c/27771/343774/5120">Lending Club</a>, Prosper, Upstart, and Funding Circle. Generally with peer-to-peer lenders, your interest rate will be based on your credit profile, so the stronger your credit, the better your options.</p> <h2>Get an advance</h2> <p>In the past few years, more companies have been offering small businesses advances on the money they expect to receive in a given month from certain sources of business. They can be helpful when you're in a jam, but make sure you understand what you're actually paying for the money, because some providers charge quite a bit for this type of financing.</p> <p>One example of a service in this space is PayPal Working Capital. This service offers loans based on your PayPal sales history, up to a maximum of 30 percent of your annual PayPal sales (and up to $97,000 for your first loan). Fees depend on the amount you borrow, your annual PayPal sales, and the percentage of your receipts that are deducted to pay back your loan. For example, if you borrow $5,000, you have $20,000 in annual PayPal sales, and you repay 30 percent of your PayPal receipts every month, you'll pay a one-time fixed fee of $615. Pay back less every month and your fixed fee will go up.</p> <p>As in the case of Fundbox financing, repayments of advances are typically deducted automatically from your business bank account at regular intervals.</p> <p>Once you're out of your cash crunch, turn some attention to doing what you can to add to your revenue and profits. Your business will be a lot healthier if you can finance most of your growth out of cash flow. And the stronger it is, the easier it will be to find financing at great rates in the future.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fcant-get-business-credit-consider-alternative-financing&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FCan%2527t%2520Get%2520Business%2520Credit_%2520Consider%2520Alternative%2520Financing.jpg&amp;description=Can't%20Get%20Business%20Credit%3F%20Consider%20Alternative%20Financing"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/Can%27t%20Get%20Business%20Credit_%20Consider%20Alternative%20Financing.jpg" alt="Can't Get Business Credit? Consider Alternative Financing" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/elaine-pofeldt">Elaine Pofeldt</a> of <a href="http://www.wisebread.com/cant-get-business-credit-consider-alternative-financing">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/need-business-credit-build-your-personal-credit-first">Need Business Credit? Build Your Personal Credit First</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-pull-your-small-business-out-of-a-cash-crunch">How to Pull Your Small Business Out of a Cash Crunch</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-your-small-business-targeting-the-wrong-customer">Is Your Small Business Targeting the Wrong Customer?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/money-to-start-your-business-without-banks-or-saving">Money to start your business--without banks or saving</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-signs-you-should-sell-your-small-business">4 Signs You Should Sell Your Small Business</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Banking Entrepreneurship alternative financing business credit small business owner small business tips Thu, 12 Apr 2018 08:30:09 +0000 Elaine Pofeldt 2128964 at http://www.wisebread.com 4 Signs You Should Sell Your Small Business http://www.wisebread.com/4-signs-you-should-sell-your-small-business <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/4-signs-you-should-sell-your-small-business" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/young_african_female_juice_bar_owner.jpg" alt="Young female juice bar owner" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Owning a small business is a labor of love. In addition to investing your money, resources, blood, sweat and tears, you also invest a small part of your soul. You love it. It's your baby &mdash; you've nurtured it from nothing to the success it is now. But every now and then, a thought flashes through your mind: Should I sell?</p> <p>Or, maybe someone else has seen, appreciates, and is willing to pay for what you've done. They offer to buy you out. Should you accept?</p> <p>Selling your business is a tricky endeavor. It's tough to know when you should take the money and run. Here are a few telltale signs that it's time to cash in your chips and call it quits. (See also: <a href="http://www.wisebread.com/8-common-myths-about-starting-a-small-business?ref=seealso" target="_blank">8 Common Myths About Starting a Small Business</a>)</p> <h2>You've become more risk averse</h2> <p>One of the biggest differences between a business owner and an entrepreneur is risk aversion. Business owners like to keep things steady and solid. As the business grows, business owners can grow more conservative &mdash; sometimes to a fault &mdash; to protect and preserve the value the business has gained.</p> <p>However, taking chances is essential to continued growth. Once you get to the point that new opportunities invoke more fear than excitement, you may want to think about calling it quits.</p> <p>When you become too conservative, you lose your edge and stunt your business's growth. Stagnation leads to death. Before you drag your business into the ground by standing still, consider capitalizing on all your hard work by selling it for a profit.</p> <h2>You're tired</h2> <p>Owning and running a business is not for the faint of heart. It sounds sexy, but behind the curtain of success is a ton of backbreaking work. And as much as you love what you do, no one wants to work that hard all of the time.</p> <p>When you start to feel tired &mdash; I mean deep down in your soul tired &mdash; that's a sign it's time to exit stage left. Being successful brings with it a satisfaction in beating the odds and accomplishing something notable. But there is a hidden side of success that is brutal and exhausting. Running a successful business can drain your energy and sap your strength. At some point, you have to know when you have had enough and allow someone else to take over.</p> <p>Exhaustion is dangerous. You don't make the good, hard choices you used to make. You find yourself doing what's easy, and nothing will bring your business down quicker than taking the easy way just because it's easy. It's better to sell and capitalize on your success, rather than lose what you worked so hard to build.</p> <h2>You've lost your drive and your passion</h2> <p>Running a business takes a sense of commitment and grit that is driven by passion. When you first launch a business, you are hungry for success and work day and night to achieve it. That hunger and love of what you do sustains you during lean years and propels you forward during turbulent times.</p> <p>When you lose motivation and the enthusiasm just isn't there anymore, that is a sign that it may be time for you to try something else. When you are no longer intrigued by and &quot;into&quot; your business, that's the time to begin thinking more like an entrepreneur than a small-business owner. Use your energy, talent, and creativity to figure how to leverage what you've built and the knowledge you've gained.</p> <p>This may be the time to groom an up-and-coming business owner and show him or her the ropes. You may not be ready to sell the business entirely, but you can allow others to buy controlling interest in the business and you can direct the choir from the back row. And when you're ready, sell your share and move to next challenge.</p> <h2>You need a change or you want to do something else</h2> <p>Remaining committed and passionate about the same thing your entire life is difficult. As a successful business owner, your experiences will undoubtedly cause you to evolve as a person. And sometimes that change whets your appetite for something new.</p> <p>If you feel the urge to strike out and do something different, go for it! Don't allow your business &mdash; which once was your inspiration &mdash; to become your prison. Allow yourself the freedom to do something different and explore other interests. Understanding when you've outgrown something takes a wisdom and insight that some people lack. Trust your instincts. If you feel it's time for a new challenge and a change of scenery, it is.</p> <h2>Making your decision</h2> <p>Deciding to sell your business is a tough call. And per the experts, the best time to sell is at the height of profitability, which is what makes the decision so much more difficult. Choosing to sell while business is good is paradoxical. On one hand, it makes sense because a prosperous business is more attractive and marketable. But on the other hand, who wants to sell when things are going great?</p> <p>The easiest way to solve this dilemma is to begin with the end in mind. Start thinking about when you'll be ready to give it up and plan for it. You may not be able to sell during your most profitable years, but you can ensure that you are in an uptick when you do put it on the market. Selling your business isn't the end of something good. It's the start of something better.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F4-signs-you-should-sell-your-small-business&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F4%2520Signs%2520You%2520Should%2520Sell%2520Your%2520Small%2520Business.jpg&amp;description=4%20Signs%20You%20Should%20Sell%20Your%20Small%20Business"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/4%20Signs%20You%20Should%20Sell%20Your%20Small%20Business.jpg" alt="4 Signs You Should Sell Your Small Business" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/denise-hill">Denise Hill</a> of <a href="http://www.wisebread.com/4-signs-you-should-sell-your-small-business">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-pull-your-small-business-out-of-a-cash-crunch">How to Pull Your Small Business Out of a Cash Crunch</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-your-small-business-targeting-the-wrong-customer">Is Your Small Business Targeting the Wrong Customer?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/cant-get-business-credit-consider-alternative-financing">Can&#039;t Get Business Credit? Consider Alternative Financing</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/my-pumpkin-lady-s-secret-to-business-success">My Pumpkin Lady’s Secret to Business Success</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-questions-to-ask-before-you-sell-a-stock-or-a-fund">10 Questions to Ask Before You Sell a Stock or a Fund</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship ambition losing interest moving on passion profit risk selling small business owner Thu, 08 Mar 2018 09:30:09 +0000 Denise Hill 2111740 at http://www.wisebread.com Is Your Small Business Targeting the Wrong Customer? http://www.wisebread.com/is-your-small-business-targeting-the-wrong-customer <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/is-your-small-business-targeting-the-wrong-customer" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/florist_taking_orders_on_the_phone.jpg" alt="Florist taking orders on the phone" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You've met with a potential client, had a couple of great conversations by phone, and followed up. So why isn't your prospect ready to start work? The problem may not be you. It may be that you're talking to someone who will never buy what you're selling.</p> <p>There could be many reasons. Maybe you're talking with a serial researcher who may never make a decision. Or perhaps the person has no budget to spend or an unrealistic understanding of what services like yours cost to deliver. It's easy to waste hours by spending too much time with tire kickers, so the sooner you recognize you're talking to the wrong customer and move on, the better. Here's how.</p> <h2>Know how to spot your ideal clients</h2> <p>Regardless of your industry, your ideal clients will probably have two characteristics: They're great to work with, and they're profitable. In many cases, they may also be repeat buyers.</p> <p>Look beyond these factors to identify if there are any common threads in your customers' industries, company size, or location, so it's easy to spot them when they're in front of you. You can use popular accounting software programs like FreshBooks and QuickBooks to sort your clients this way. You may spot some interesting patterns you had not noticed, like one particular state where you get a lot of business.</p> <p>Look a little deeper. If, for instance, you sell marketing services and most of your clients are big companies, peruse the job titles of the clients who have signed contracts with you. Perhaps buyers in these firms tend to have a certain level of seniority in their organization. This doesn't mean you should ignore prospects with more junior titles, but if those junior buyers seem to be moving slowly, you may need to involve more senior people on their team to move a project along. (See also: <a href="http://www.wisebread.com/8-common-myths-about-starting-a-small-business?ref=seealso" target="_blank">8 Common Myths About Starting a Small Business</a>)</p> <h2>Ask qualifying questions</h2> <p>Learning as much as possible about why clients are considering buying your product or services can save you from spending a lot of time with someone who is highly unlikely to move ahead or won't turn out to be a good fit.</p> <p>I do this when people ask me to ghostwrite books for them &mdash; a process that takes a lot of time and energy for both the author and myself. In our first conversation, I might ask: &quot;Why do you want to write a book?&quot; If the author is eager to share ideas they're passionate about with the world and says they've already done a rough outline of the book or lectures on the topic, those are positive indicators.</p> <p>However, if someone says that colleagues, a spouse, or friends keep nudging them to write the book, I'll suggest a smaller project first to make sure they are truly motivated. Even if someone has the budget to hire me, I don't want to work with someone who is likely to lose steam and see the project fail.</p> <p>There are many other qualifying questions you can ask to weed out people who are not serious. You might, for instance, ask if they need a project by a certain deadline &mdash; which will naturally give them an incentive to hire you. You might also ask what their expectations are. If they would like to receive certain services you don't offer and that you don't want to start providing, that's a disqualifier. (See also: <a href="http://www.wisebread.com/6-helpful-tools-to-manage-your-small-business?ref=seealso" target="_blank">6 Helpful Tools to Manage Your Small Business</a>)</p> <h2>Be transparent about pricing</h2> <p>Many business owners hesitate to talk about what they charge because they're afraid of scaring clients away. That can be a big mistake. Many potential clients could be price-sensitive, so being direct and upfront about what you charge, by sharing it early in your conversations, can save you a lot of time.</p> <p>If someone's budget is too small to afford your highest-end products or services, be prepared to suggest other creative alternatives. For instance, instead of the yearlong retainer contract you usually offer, what about a three-month version? That way you won't have to turn away clients who you might otherwise enjoy working with.</p> <h2>Watch out for clients who don't value your time</h2> <p>When you hire outside professionals &mdash; whether to do your social media or clean your house &mdash; do you expect them to donate their time? I didn't think so.</p> <p>One sign that you're talking to the wrong clients is that they want you to &quot;prove&quot; yourself by doing a project for free. Someone who does not understand that you need to get paid for your work now will never respect your time and is likely to become a nonpaying client later. If prospects want to get a chance to see what it is like to work with you, suggest they work with you on a very small, paid project instead. (See also: <a href="http://www.wisebread.com/10-smart-ways-to-get-a-small-business-loan?ref=seealso" target="_blank">How to Get a Small Business Loan</a>)</p> <p>There's one exception. If you're selling clients access to a service many people haven't tried yet, such as a specialized type of fitness class, there's nothing wrong with offering one free trial class or even a discounted monthly membership to make sure they know what they're buying. Just make sure you're offering an experience they will value enough that they want to come back when they have to pay full price.</p> <p>Relying too heavily on bargain hunters for your cash flow could lead to a crowded atmosphere that drives away clients who would be willing to pay you a little extra for some elbow room and tranquillity. Experiment until you find the right approach to attract great new customers and keep your ideal ones coming back. Once you find the right balance, you'll enjoy your business a lot more.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fis-your-small-business-targeting-the-wrong-customer&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FIs%2520Your%2520Small%2520Business%2520Targeting%2520the%2520Wrong%2520Customer_.jpg&amp;description=Is%20Your%20Small%20Business%20Targeting%20the%20Wrong%20Customer%3F"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/Is%20Your%20Small%20Business%20Targeting%20the%20Wrong%20Customer_.jpg" alt="Is Your Small Business Targeting the Wrong Customer?" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/elaine-pofeldt">Elaine Pofeldt</a> of <a href="http://www.wisebread.com/is-your-small-business-targeting-the-wrong-customer">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-find-freelance-clients-part-two">How to Find Freelance Clients: Part Two</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-grow-your-solo-business-without-hiring-employees">How to Grow Your Solo Business Without Hiring Employees</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-5-best-credit-cards-for-small-businesses">Best Credit Cards for Small Businesses</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-freelancers-can-promote-their-work-without-social-media">5 Ways Freelancers Can Promote Their Work Without Social Media</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-pull-your-small-business-out-of-a-cash-crunch">How to Pull Your Small Business Out of a Cash Crunch</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship clients customer service entrepreneur grow your business small business small business owner Thu, 04 Jan 2018 09:30:11 +0000 Elaine Pofeldt 2082514 at http://www.wisebread.com How to Pull Your Small Business Out of a Cash Crunch http://www.wisebread.com/how-to-pull-your-small-business-out-of-a-cash-crunch <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-pull-your-small-business-out-of-a-cash-crunch" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/freelance_calculating_a_budget.jpg" alt="Freelance calculating a budget" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You're working around the clock. So why are you short of cash? For a lot of self-employed people and small business owners, the answer is poor cash flow. Even if you're making a great living on an annual basis, there may be periods where the money flowing into your business slows to a trickle.</p> <p>Fortunately, there's a lot you can do to prevent a cash crunch and get out of one if you're short of funds. Here are the steps you can take.</p> <h2>Vet clients carefully</h2> <p>We all love making sales, but closing a deal is only helpful to your business if you can collect the money you've earned in a reasonable period. If someone wants to hire you for a big project, suggest working on a small project together first and then build from there.</p> <p>Use the small project to test how quickly the client pays you. If someone takes 90 or 120 days to close a $500 invoice, imagine how long it will take to get paid for a $10,000 gig. You may be better off working for another client, instead. Your bills are generally going to be due monthly and there's no way around that. (See also: <a href="http://www.wisebread.com/8-ways-freelancers-can-make-sure-they-get-paid-on-time?ref=seealso" target="_blank">8 Ways Freelancers Can Make Sure They Get Paid on Time</a>)</p> <h2>Diversify your client base</h2> <p>If you are a contractor dependent on just one client, you're very vulnerable to a cash crunch if something goes wrong in the payment process. Should that client hit a slump and postpone paying you, it will be easy to run out of money. &quot;If you want them to pay you on time, you're at their mercy,&quot; says Bob Shoyet, CFO of Melillo Consulting in Somerset, New Jersey.</p> <p>Although you don't want to spread yourself too thin, adding just a few more clients will give you income security you don't have with just one or two.</p> <h2>Let a third party handle client payments</h2> <p>Another way to reduce the risk of late payments is to onboard some of your clients to a freelance platform such as Upwork. Although Upwork will take a cut in your pay, it offers options for you to get paid for completed projects every Wednesday, twice a month, monthly, or quarterly &mdash; and takes on the task of collecting the payments from your clients.</p> <p>Another option is Freelancer.com, which offers a feature called the Milestone Payment System. It requires clients to pay you at predetermined points as you hit certain project goals. Payments are made securely within the site, which can be a benefit too if you're worried about checks getting lost in the mail.</p> <h2>Negotiate contracts carefully</h2> <p>Ask for a substantial deposit on projects upfront with progress payments along the way if this is customary in your industry &mdash; rather than billing for the whole project on the back end. If you do retainer work, invoice for payment at the beginning of the month, rather than at the end, with a due date of a week or 10 days after that. Very small businesses really aren't in the position to finance projects for their clients, so make sure you're doing that as little as possible.</p> <p>If you work in a field where it's not common to ask for a deposit and clients tend to take more than 30 days to pay &mdash; as is often the case with big companies &mdash; consider offering them a discount if they pay you early. &quot;Companies do take that into consideration,&quot; says Shoyet.</p> <p>Some of my own freelance clients require vendors to use an electronic payment system called Coupa to submit invoices. They have set up their accounts so vendors can access a pulldown menu that includes an option to offer a discount if the client pays earlier than the standard 60 days.</p> <p>If you do offer a discount, make sure to record the dollar amount of the discount as an expense in your accounting software, Shoyet says. (See also: <a href="http://www.wisebread.com/5-ways-to-build-business-credit-when-youre-self-employed?ref=seealso" target="_blank">5 Ways to Build Business Credit When You're Self-Employed</a>)</p> <h2>Finish projects on time</h2> <p>Getting into a situation where you have a lot of projects that are in the middle of the completion process and not many that are finished can lead to long periods where you can't submit many invoices &mdash; and have little money coming in later. When you're planning your weekly schedule, look for ways to bring as many projects as possible to the finish line while still doing a great job. Even finishing a few small projects can give you a lifeline. The more quickly you finish a project, the sooner you can send an invoice.</p> <h2>Stay on top of invoicing</h2> <p>When you offer 30-day payment terms to a client, the 30 days start when you send the invoice. If you're routinely waiting a week or two after completing a project to invoice, you'll be postponing the day you get paid.</p> <p>No matter how busy you are, set aside at least an hour or two a week to submit invoices so you don't fall behind. If you just can't find the time, consider hiring a bookkeeper to help you keep your books and submit invoices for you. A very small business should not require more than a few hours of help a month, and this modest investment could save you from having to borrow later. (See also: <a href="http://www.wisebread.com/5-free-accounting-tools-for-freelancers?ref=seealso" target="_blank">5 Free Accounting Tools for Freelancers</a>)</p> <p>If your clients are willing to pay you electronically, that can speed up payments. The popular accounting software programs QuickBooks and FreshBooks let you accept both ACH payments and credit card payments. I prefer to use ACH to avoid credit card processing fees, which can add up on large projects. But if you're working with a client who may have cash flow issues, paying the credit card fee may be a good investment in protection against receiving a seriously late project payment.</p> <h2>Follow up</h2> <p>Sometimes, when I've checked on an unpaid invoice, I find out it has been lost in a client's inbox. The sooner you figure out that this happened &mdash; and follow up in a cheerful manner &mdash; the better.</p> <p>If you send your invoice as a link from QuickBooks or FreshBooks, you can see whether an invoice was &quot;viewed.&quot; Sent it as a PDF? Use your email functions to see if the email was read. If an invoice was not viewed, mention to your client that it's showing up as &quot;unread&quot; and ask if he or she would prefer that you send it in another format. There might be an issue that is causing it to get lost in Inboxland and hold up your payment.</p> <h2>Put a safety net in place</h2> <p>Make sure you have at least one <a href="http://www.wisebread.com/the-5-best-credit-cards-for-small-businesses?ref=internal" target="_blank">credit card for your business</a> and, ideally, a line of credit with your bank, too. You don't have to use them, but it's good to have them set up for an emergency &mdash; particularly if have a payroll for your business. If your credit is good and you are not maxed out on debt, many banks can help you get a business credit card quickly. (See also: <a href="http://www.wisebread.com/10-smart-ways-to-get-a-small-business-loan?ref=seealso" target="_blank">10 Smart Ways to Get a Small Business Loan</a>)</p> <h2>Know where to turn for quick cash</h2> <p>What if you're in a crunch now? Make one last attempt to collect seriously late invoices that you've just about given up on. Try reaching out to the company's accounts payable team, instead of your original contact.</p> <p>Also consider putting your receivables to work for you. <a href="http://www.fundbox.com" target="_blank">Fundbox</a>, one service that has been picking up traction, will allow you to borrow up to $100,000 against your receivables and repay the loan over 12 or 24 weeks. To work with Fundbox, you need to use one of the invoicing platforms the company works with &mdash; Clio, eBillity, FreshBooks, Harvest, InvoiceASAP, Kashoo, Jobber, PayPal, QuickBooks, Sage One, Xero, and Zoho.</p> <p>Borrowing this way isn't cheap, but if you have urgent bills to pay or need to make payroll, it may be necessary. Then, once you're out of your crisis, take some time to put better systems in place so the cash starts flowing more evenly. You'll enjoy your business a lot more that way.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fhow-to-pull-your-small-business-out-of-a-cash-crunch&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520to%2520Pull%2520Your%2520Small%2520Business%2520Out%2520of%2520a%2520Cash%2520Crunch.jpg&amp;description=How%20to%20Pull%20Your%20Small%20Business%20Out%20of%20a%20Cash%20Crunch"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/How%20to%20Pull%20Your%20Small%20Business%20Out%20of%20a%20Cash%20Crunch.jpg" alt="How to Pull Your Small Business Out of a Cash Crunch" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/elaine-pofeldt">Elaine Pofeldt</a> of <a href="http://www.wisebread.com/how-to-pull-your-small-business-out-of-a-cash-crunch">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-japanese-budgeting-system-could-be-the-key-to-saving-big-bucks">This Japanese Budgeting System Could Be the Key to Saving Big Bucks</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-budget-consistently-without-a-steady-paycheck">How to Budget Consistently Without a Steady Paycheck</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-manage-your-money-no-budgeting-required">How to Manage Your Money — No Budgeting Required</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-apps-that-make-budgeting-fun-no-really">7 Apps That Make Budgeting Fun — No Really!</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-gluttony-is-keeping-you-poor">6 Ways Gluttony Is Keeping You Poor</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting Entrepreneurship cash crunch cash flow freelancer freelancing tips money management saving money small business owner Thu, 28 Dec 2017 09:31:05 +0000 Elaine Pofeldt 2077708 at http://www.wisebread.com Who Cares if there's a Recession? I just started a business http://www.wisebread.com/who-cares-if-theres-a-recession-i-just-started-a-business <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/who-cares-if-theres-a-recession-i-just-started-a-business" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/Photo 23.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="188" /></a> </div> </div> </div> <p>About four months ago my best friend thought she&rsquo;d run a crazy idea by me. Want to open a shop together?</p> <p>No.</p> <p>It&rsquo;ll be fun....</p> <p>No.</p> <p>Come on we can do it together.</p> <p>No. Okay. Let me think about it. </p> <p>The only person I know busier than I am is my friend Kristy. A year ago a woman with a salon and boutique who did nails asked if Kristy would come back and do hair at her salon. Kristy had a good reputation in town and had made a little home salon and was getting by that way. She&rsquo;d put herself through college doing hair and a few years back had decided that doing hair fit better with the mom schedule than anything else.The original salon owner was leaving and offered Kristy the business. She was buying but there was a whole second room in the shop that didn&rsquo;t have much in it. The rent for that room would be about $100.00 a month. Was I interested?</p> <p>I did what any friend does. I went home and ran it by the family.</p> <p>Here are some factors we considered:</p> <p>Cheap overhead?<br /> Concept of the store?<br /> Location of the shop?<br /> Time to devote to it?</p> <p> The more I thought about it, the more the idea sounded intriguing.</p> <p>The overhead is $100 a month plus $60 in Internet expenses. I&rsquo;d been wanting to have an office in town so that I could stop working from home all the time. The salon is located caddy corner to my kids&rsquo; school. One was getting out at noon and the other at two so I was frantically driving back and forth or having to hang around to go home. With the Internet, I could still grade papers and work in a new place. Kristy is busy and so am I. She cuts hair in the morning; I&rsquo;m online&nbsp; in the afternoon. We could have a shop open all day and just overlap by about thirty minutes each day.</p> <p>Then it dawned on me. A couple of years ago I&rsquo;d started up a site on etsy.com for a bunch of women around here that made things but weren&rsquo;t very Internet savvy so that they could promote their wares online. I called a few of the ones that were around. If I open an artisan consignment shop , are you up for it?</p> <p>We&rsquo;ve been up and running for two months. I&rsquo;ve got 15 local venders that&nbsp; make t-shirts, soap, lotions, bbq sauce, hot sauce, jewelry, bread mixes, rocking chairs, spin and dye their own yarn plus a few artists in the area that hang their photographs and paintings. In the corner of the shop I&rsquo;ve set up my desk with my wireless to grade papers and write. We put the waiting room for the salon in the room so that customers get an eye full of stuff to look at and browse through while they are waiting for hair cuts. We&rsquo;re the only place for Wi-fi on the way to three campgrounds. We have a huge porch out front for the kids to play on. We aren&rsquo;t making the big bucks but we don&rsquo;t owe anyone a dime either.&nbsp; We put together a small book exchange too.</p> <p>In a town with only 150 residents in a region with only 2000, having a place to hang out and to showcase local stuff for the tourists, having a little shop like this one can play a big role in the community. Once a month we have an &lsquo;event&rsquo; that helps us make rent---thus far we&rsquo;ve always cleared rent that one day for the whole month. Somedays we only make about $10 bucks. But I look at it this way---had I not moved my office into the shop , I&rsquo;d have been sitting there grading papers anyhow---now I&rsquo;ve got $10 extra.</p> <p>Local response has been great!&nbsp; Vendors are willing to &lsquo;babysit&rsquo; the store when I can&rsquo;t be there. There&rsquo;s nothing around here in the way of competition and people are happy to be supporting the local artisans before they go to other sources like the Internet or big box stores two hours away.</p> <p>The husbands helped us with building fixtures and set up. Kristy's given some free hair cuts in trade for banners for the store and advertising. Low and behold! Last week a restaurant opened across the street from us. What was a tiny deserted ghost of a town now has a full two blocks of commerce.</p> <p>So if you are sitting around working from home and you don&rsquo;t mind someone walking through every now and then walking through and buying a little one of a kind treasure, consider opening a little shop---you might just make yourself and your community smile.</p> <p>Long Live SierraMaid!<br /> &nbsp;</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/maggie-wells">Maggie Wells</a> of <a href="http://www.wisebread.com/who-cares-if-theres-a-recession-i-just-started-a-business">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-19"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/make-your-hobby-pay-its-way">Make Your Hobby Pay Its Way</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/31-reasons-why-im-in-love-with-thrift-shopping-and-you-should-be-too">31 Reasons Why I&#039;m in Love With Thrift Shopping (and You Should Be Too)</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-thrifty-meaningful-gifts-for-mom">9 Thrifty, Meaningful Gifts for Mom</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/gift-giving-hacks-that-will-save-your-money-and-your-sanity">Gift Giving Hacks That Will Save Your Money and Your Sanity</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/these-diy-magazines-can-help-you-be-self-reliant">These DIY Magazines Can Help You Be Self-Reliant</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> DIY Lifestyle Shopping Art and Leisure consignment shops Making Extra Cash small business owner Sat, 23 May 2009 03:51:21 +0000 Maggie Wells 3193 at http://www.wisebread.com How to Find Freelance Clients - Part One http://www.wisebread.com/how-to-find-freelance-clients-part-one <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-find-freelance-clients-part-one" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/2416885057_5fe37e7edc.jpg" alt="outdoor freelance office" title="outdoor freelance office" class="imagecache imagecache-250w" width="250" height="167" /></a> </div> </div> </div> <p>With the number of people getting laid off increasing daily, it's no wonder why more people are looking at freelancing or <a href="http://www.wisebread.com/6-reasons-to-become-self-employed">self employment</a> options to make ends meet.&nbsp; Once you hang your &ldquo;open for business&rdquo; sign, the hard part begins! Finding clients to pay you for your products or services can be the most challenging aspect of starting and running a business. After all, without clients buying what you have to offer, you certainly can't remain in business for long.</p> <p>Getting your first client will accomplish a few things for you, business-wise. First, you'll of course have a client who is paying you, which is necessary for earning a profit and is the life blood of all businesses. Second, that first client can very well open the door to many other clients, through referrals and word of mouth; and can even turn into long term, consistent work &ndash; even if you thought it was a one-time project. Once you're ready to start your freelance business, what steps do you need to take to find your first client &ndash; and then every client after that?</p> <p>Regardless of the type of freelancing you do, the process of getting your first client is similar across all industries, and will require <a href="http://www.wisebread.com/focus-focus-fowhat-was-i-saying">focus</a> and discipline on your part to make it happen!</p> <p><strong>Prepare to Prove Yourself</strong>: As a new freelancer, hanging your &ldquo;open for business&rdquo; sign isn't enough to prove you are capable of providing high quality work. Prospective clients are weary of new business owners, and many will prefer to work with experienced freelancers in your industry. How do you prove your abilities if you've just started out?</p> <p><strong>Previous Work Experience</strong>: Before you decided to go-it-alone, chances are you were employed by another business at some point in time. Perhaps you are still employed, and are looking to freelance on a moonlighting basis until your business takes off and profits. Either way, think back to any work you have done for your employer which is an example of your abilities. If you are looking for <a href="http://www.makemoneyfromwriting.com">freelance writing</a> clients, you can probably dig up a letter or manual that you worked on for your employer. As long as it isn't confidential information, you can probably use this type of writing as initial samples for prospective clients. If you are a freelance graphic design or web developer, anything related to your line of work that was completed for an employer may very well be sufficient to prove your abilities in the field.</p> <p><strong>Do Some Volunteer Work:</strong> If you don't have anything suitable to use as samples to show your ability to do the work, consider volunteering to help a nonprofit organization. Create a website, develop logos or graphics, or write marketing materials at no charge; in exchange for using the item(s) you create as samples of your work.</p> <p><strong>Build a Portfolio</strong>: Many new freelancers, particularly those in the creative industries, feel trapped in a catch 22 when it comes to building a portfolio! <a href="http://www.ehow.com/how_4482212_portfolio-before-have-writing-clients.html">How can you have a portfolio if you haven't had any client</a>s, yet? On the other hand, who is going to hire a writer, artist, or web designer without seeing a portfolio of your best work? The solution is to get to work creating a portfolio that shows off what you can do &ndash; and keep adding to your portfolio as you develop more samples. For individuals who haven't had any clients yet, it's an opportunity to come up with your own creative pieces to include. For example, you will need business cards, a web site, and other items for your business &ndash; you may as well start your portfolio out with the creative pieces you'll need to start and run your own business. Whatever your area of expertise is, do the work and include in the portfolio. Proving your ability is essential for clients to trust in your services and have confidence to hire you. As a new freelancer, you won't have testimonials of happy clients to back up your own claims of expertise, so your best option is to have samples of work you've completed ready to show off whenever you have the opportunity to communicate with a prospective client.</p> <p>Once you have samples and/or a portfolio ready to go &ndash; where do you start finding prospective clients?&nbsp; We'll discuss this in &quot;How to Find Freelance Clients:&nbsp;Part Two&quot;.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/debbie-dragon">Debbie Dragon</a> of <a href="http://www.wisebread.com/how-to-find-freelance-clients-part-one">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/tips-for-finding-legitimate-work-at-home-opportunities">Tips for Finding Legitimate Work at Home Opportunities</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-gadgets-every-work-at-home-professional-needs">6 Gadgets Every Work at Home Professional Needs</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-college-courses-that-will-boost-your-career">7 College Courses That Will Boost Your Career</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/16-time-and-money-saving-apps-for-freelancers">16 Time and Money Saving Apps for Freelancers</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-millennials-can-become-bosses-sooner">5 Ways Millennials Can Become Bosses Sooner</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Career Building entrepreneurship finding clients freelance jobs freelancing Making Extra Cash small business owner Tue, 12 May 2009 11:31:58 +0000 Debbie Dragon 3151 at http://www.wisebread.com