Debt Financing

Business owners may have some trepidation about borrowing from a financial institution, as it means relinquishing some cash profits. But it could be a good option so long as you expect to have sufficient cash flow to pay back the loans, plus interest. The major benefit for debt financing, unlike with equity financing, you’ll retain full ownership of your business. The interest on business loans is also tax-deductible, and you’ll build your credit.

Small businesses frequently take bank loans. They are usually easy to obtain – so long as you have good credit, enough equity to cover the payments and you’re not already carrying heavy debts. These loans are generally granted either on a short-term basis of less than one year or long-term basis of more than one year.

If you want to raise $100,000 or less, you may be able to receive a bank loan based on your personal credit. This is called an unsecured loan. Secured loans are granted in larger amounts. Banks usually expect you to put up assets to back the loan. These assets could include property, your personal investments, equipment or other tangible holdings that the bank could seize if you default on the loan.

Commercial finance companies also lend money and are willing to fund riskier ventures that don’t have solid financials. But this type of funding usually comes with high interest.

Equity Financing

Small business owners when weighing debt and equity financing options often opt for equity financing because they have concerns about either qualifying for a loan or having to channel too much of their profits into repaying the loan. Investors and partners can provide equity financing, and they generally expect to profit from their investments. No debt payments means more cash on hand. Moreover, if no profit materializes, you aren’t obligated to pay back equity contributions.

The major drawback of equity financing is that you are no longer the full owner of a business once you have other financial contributors who expect a share. As such, you will be relinquishing not just financial control, but will no longer be the sole arbiter of the business’s creative and strategic direction.

There are also so-called angel investors: wealthy individuals or networks that are willing to fund small businesses. Angels are the largest source of seed and start-up capital for businesses, investing $25.6 billion in businesses in 2006, according to the Center for Venture Research at the University of New Hampshire. Angel investors tend to fund small businesses for longer periods of time and expect a lower return on investment than do venture capital firms.

Venture capital firms, on the other hand, provide equity for businesses and expect high returns on their investments within three to five years. They generally fund companies with significant growth potential — Microsoft and Google attracted VC funding — not small businesses.

Most businesses have a mix of debt and equity financing. Too little equity could prevent you from securing or repaying loans, while carrying little or no debt could indicate that you are too risk-averse, and that your business might not grow as a result. Check with your industry association to find the average debt-to-equity ratio for your sector.

By Tiare Rath

An important source of funding for your business in the future can be the bank. Relationship banking has been the cornerstone of small business financing. A good relationship between the business owners and bankers allows for the free exchange of knowledge and the ability to meet the needs of business. A banker informed of your business can not only provide you with a small business loan but also offer practical advice on financial matters.

Banking Relations and Your Small Business Loan

Setting up a relationship with your banker begins with following five tips:

• Set up a bank account at a bank that deals with your size and type of small business.
• Manage the account effectively and avoid overdraws, bounced checks, and low balances.
• Borrow a short-term loan and pay quickly to establish your business credit.
• Keep your bank informed of upcoming issues, missed projections, and missed payments.
• Get to know your banker and help them to understand your business.
  Relationships can be beneficial when it comes time to apply for a small business loan or large credit line. Remember, banks are in business and all companies need to assess risk and make profits.

By Darrell Zahorsky

There are a variety of money sources for small business including grants, small business loans, SBA loans, angel investors and much more.

Debt & Equity Financing: Debt and equity financing are two different financial strategies: Taking on debt means borrowing money for your business, whereas gaining equity entails injecting your own or other stakeholders’ cash into your company.

Small Business Grants: Small business grants are often a hot topic among entrepreneurs with limited funds and access to capital. There are many misconceptions when it comes to grants for small business.

First Time Small Business Loan: The best place to start when it comes to finding your first small business loan or credit is not with your banker, accountant or lawyer but with you. The business is the owner so your personal credit history is an important aspect in getting a small business loan.

Small Business Loans Qualification: When banks start to tighten lending to the small business market, they look to reduce the risk of issuing a small business loan. To qualify, a small business must understand the risk assessment processes bankers use in loan determinations. Bankers making a loan approval will review a small business in the context of the 5 C’s for small business loans and credit.

Find an Angel Investor: On a wing and a prayer, an angel investor can help take your company to the next level in one swoop. At what time in your company’s lifecycle are angel investors a best option?

SBA Loans: The Small Business Administration helps facilitate loans for small businesses, but it doesn’t give grants, nor does it issue startup SBA loans directly. Instead, the SBA acts as a guarantor for small businesses borrowing from traditional lenders. If you think you might need a backer to secure funding, startup SBA loan programs could help your small business find its footing.

For the start up business, contrary to popular belief, most start-ups aren’t funded by grants, angel investors, or banks. So don’t get discouraged if you don’t find the money you need initially. Your seed money will come from your personal savings, friends, family, and any other creative means.

By Darrell Zahorsky

This scenario can happen to any part-time business owner. This is not to say working full-time while running a part-time business is impossible but balance and knowledge are key factors in business success.

Part-time businesses allow entrepreneurs to “test the waters” and see if the business is viable while still earning a full-time paycheck. But there are many traps to avoid when moonlighting. Learn the 6 keys to avoid part-time business disaster.

6 Keys to Avoid Part-time Business Disaster

1. A Conflict of Interest?: The first question to ask when starting a part-time business is “Does your venture conflict with the interests of your employer?” If your part-time business and employer markets and serves the same industry, there may be a conflict. Examine your hiring package to see if there is a non-compete agreement and the extent of the clause.

Discuss openly with your boss the venture you plan to start and how it will not conflict with clients and time. In some cases, the company can view your moonlighting as a positive gain for the company if you can acquire new skills that can be applied to your current job.

2. Determine Part-time Suitability: Some businesses are more suited to part-time operation. Retail operations require full-time hours, whereas a consultant can take on several small projects with less time commitment. Talk to other people in your industry to see if part-time is a viable option.

3. Manage Your Time: Running a part-time business while fully employed will test your time management skills. Family, chores and sleep may be the biggest issues. Avoid burnout. Many part-time business owners under estimate the commitment required for success. Accept limited work projects and do not over promise.

4. Build Support: A 40-hour work week combined with a part-time business may add up to more hours than running the venture full-time. Make sure family and friends understand your burden and can be there to offer help. Support can be as simple as help with errands, filing and bookkeeping.

5. Focus on One Business: The temptation of all small business start-ups is the lure of multiple business opportunities. This must be avoided at all costs by the part-time business operator. With already limited time and resources, expanding into other businesses can draw much needed attention away from your part-time company. Focus on one business only until you have made it successful.

6. Know the End Result: As you set-up your part-time business, have a clear end goal in mind. Is this venture simply a means to additional income, or will it one day be a full-time company? If you are planning to quit your day job, set a time line to transition from part-time and employed, to full-time business and unemployed. If possible, have extra cash reserves built up to augment the ups and downs of not having a regular paycheck.

A part-time business can be a wonderful way to grow your company. In our fast-paced business world, it seems atypical to dabble part-time in starting a new business. But if you have a need for security, the “slow-to-grow” venture can be the best chance for success. Just ask Michael Dell, who started Dell Corporation part-time in his college dorm. Part-time may be the best start-up secret to date.

Courtesy of Darrell Zahorsky

Break the 5 Barriers to Starting a Business

No Money: Having enough money to start a business is claimed by many entrepreneur wannabees to thwarting their dreams. The reality of a successful business is to bootstrap it in the beginning and accomplish the most critical mission of any startup… finding a customer. Forget the fancy office, the cool CEO chair, or glossy four color brochures. It doesn’t take big dollars to start a small business. Over 48% of the Inc. 500 started their business with less than $20,000.

No Time: Working a full-time job, raising a family, and enjoying a weekend out is the common time-filled life when you work in cubeville. Time is a resource we can control. If you’re going to be a successful business owner, mastering time is key. Startups require sacrifices. You have to be willing to give up the weekends to build momentum.

No Benefits: Let’s face it, stepping out of the corporate world without benefits can feel like walking a trapeze without a safety net. It can be easier for a younger, healthy worker to forgo the health benefits offered by a company. For the Baby Boomer startup entrepreneur, health benefits remain a top concern. Think through your decision, use your spouses plan or consider the optional HSA’s (Health Savings Account).

No Family Support: It’s difficult enough to give up the comforts of the corporate world to start a business. Without the support of your family and friends the journey can be challenging. To win the support of your family take the time to explain the business and build a solid business plan. If others can see how you have taken the time to think it through and minimize the risks, they will be more supportive.

No Courage: Dig deep enough and you will often find the reasons for not starting a business are excuses. The biggest barrier to overcome is yourself. Fear is present in all entrepreneurs. An interview with Tony Magee, the CEO of Lagunitas Brewery, on MyPrimeTime says fear is a strong motivationor. Fear drives him daily to succeed. It’s a matter of learning to accept fear as a silent companion you can beat everyday.

Departing from the cube life takes dedication, guts, and a little chutzpa. Millions of business owners have succeeded. Take the plunge today and join the entrepreneurial revolution.

By Darrell Zahorsky

Talk about headaches. Having to come up $75 billion in new capital is a stress test in itself for the banks deemed to be in the worst shape by the Federal Reserve. Compared with that, resolving issues you’re having with your own bank seems like a walk in the park. Still, dealing with financial institutions nowadays can be a major source of irritation. Ask these questions to determine how well your bank is serving you — and learn what to do to lower your own stress level:

Are my deposits safe?

As long as your bank is insured by the Federal Deposit Insurance Corp., your money is guaranteed — up to $250,000 per depositor. That’s the case even if you have an account with Bank of America, which tops the bad-bank list and needs to raise $34 billion in capital. Call 877-275-3342 to verify that your bank is covered by the FDIC, which is backed by the full faith and credit of the U.S. government. The $250,000 limit was scheduled to revert to the previous $100,000 limit after December 31, 2009, but Congress just passed a bill that extends it to 2013.

FDIC insurance covers checking accounts, savings accounts, money-market accounts, certificates of deposit and retirement accounts. You can insure substantially more than $250,000 if you arrange ownership of the accounts properly. Use the FDIC’s Electronic Deposit Insurance estimator to figure out if the total amount of your deposits is covered.

Credit-union deposits up to $250,000 are protected by the National Credit Union Share Insurance Fund. The National Credit Union Administration, the government agency that oversees credit unions, provides a calculator to help you determine whether the funds deposited in your credit union are insured.

Are my savings earning enough interest?

The average interest rate on bank money-market deposit accounts is a paltry 0.40%. But you can earn significantly more by switching to a high-paying account with an online bank, such as Ally Bank (formerly known as GMAC Bank), in Utah. If you know you won’t need your money for a while, you can earn 2.20% with a six-month certificate of deposit at Corus Bank, in Illinois, or 2.8% with a 12-month CD at Ally Bank.

Will my bank lend me money?

Most lenders have tightened their standards, but money is available if you spiff up your credit. Today you’ll probably need a credit score of about 730 to qualify for the best rates on a mortgage.

If you can’t come up with 20% for a down payment, you may have to pay a higher interest rate or additional closing fees. Check with your local community bank or credit union — they’re advertising their willingness to make loans and may be able to offer you a better deal than the mega-banks.

If you’re applying for a loan, prepare in advance by checking your credit report. The 2009 Consumer Financial Literacy Survey by the National Foundation for Credit Counseling showed that 144 million people had not ordered a copy of their credit report in the past year.

You can order a free credit report from each of the three credit bureaus at www.annualcreditreport.com. For an additional $7.95, you can get your FICO credit score with your Equifax report. At www.myfico.com, you can see how your credit score affects your monthly payment for a home mortgage or car loan.

Am I being hit with more fees for ordinary transactions?

Financially shaky banks need to raise cash however they can. But that doesn’t mean you have to pay up. Open an account at a bank with a large ATM network so that it’s easy to find a convenient ATM and avoid the $4 fee you must pay whenever you use another bank’s ATM. Or switch to a credit union — such as Navy Federal Credit Union — that participates in a surcharge-free ATM network. Online banks, such as UFBDirect.com, don’t charge ATM fees and will reimburse you up to $4.50 a month for ATM charges from other banks.

Overdraft fees generated $17.5 billion in income for banks in 2007, according to the Center for Responsible Lending. You can limit your share if you link your checking account to a savings account so that the bank transfers your funds from one account to the other. You’ll be charged a transfer fee (typically $5) rather than an overdraft fee ($ 25 to $27 is the median at community banks and credit unions, $33 at mega-banks).

Has the bank raised the rate on my credit card?

You’re not alone. Banks that have to firm up their balance sheets are raising interest rates, lowering credit limits or canceling cards outright for customers they deem to be too risky.

If your card issuer changes the terms and conditions of your credit-card agreement, call the toll-free number on the card and ask to have the changes rescinded. If a lower credit limit means that you are using more than half of your available credit, try to pay down your balance as quickly as possible so that your credit score doesn’t drop. You can reject the new terms, but closing the account will affect your credit score, especially if you have used the card for a long time.

If you decide the new rate is onerous and want to close the account, look for a low-rate balance-transfer offer at www.lowcards.com or www.billshrink.com. Most 0% balance-transfer offers come with a fee of 3% of the amount you transfer. One exception is Pulaski Bank, which has no fee for its six-month offer. The card, which carries a fixed interest rate of 6.5%, does have a $35 annual fee. But that’s a small price to pay for its low interest rate.
Copyrighted, Kiplinger Washington Editors, Inc.

You can greatly increase your chances of successfully securing a small business loan by being prepared to meet those expectations.

Put yourself on the other side of the desk for a moment. If someone asked you for a small business loan, you’d want to know exactly why he or she wanted the money and what the chances were that he or she would repay the loan in full and on time.

So the key to getting a small business loan is preparation. First, gather together the documents that will help persuade the lender that a small business loan is necessary and that you are a good risk. You will need:

A business plan – The business plan show the lender not only why you want a small business loan but what you plan to do with the money.

Cash flow projections – What’s the first question any lender has? Will you be able to repay the loan. Your business’s cash flow projections give lenders concrete financial data that they can use to assess this risk.

A statement of your personal financial status – A list of your personal assets and debts to give the lender a fuller financial picture.

To get a small business loan, you may also need these documents:

Past business tax returns – If your business is established and you have past business tax returns, it’s a good idea to take them with you. They’ll give the lender a better idea of how your business is doing financially.

A credit rating report – Basically, you establish a credit rating by buying things on credit and paying back the money you owe. Your loan repayment history plays a big part in establishing your credit rating, but all your “credit” dealings make up the history that’s used to determine your credit rating.

It’s not necessary that you include a credit report with your small business loan application; it’s easy enough for potential lenders to check your credit rating. But if you don’t know what your credit rating is or suspect your credit rating is tarnished, you may want to get one.

You can get a credit report by contacting one of the three credit reporting agencies in Canada, TransUnion, EquiFax Canada, or Northern Credit Bureaus. To receive your free credit report, you will need to mail or fax one of these companies a request along with copies of two pieces of I.D.

The credit report you receive several weels later will include information on what to do if you find errors in the report. If you have a poor credit rating, you will want to take steps to repair your credit rating before trying to get a small business loan.

Now that you have all the documents you need to get a small business loan in order, how do you actually persuade the lender to give you a small business loan? Continue on to the next page for tips on making a winning small business loan presentation.

The next step in getting a small business loan is to persuade the lender to give you a small business loan. You need to prepare in advance to make a winning small business loan presentation.

Start by considering the lender’s point of view. You want money. But he or she is most interested in the answers to these two questions: “What are you going to do with the money?” and “Are you a good risk?”, and to make a winning small business loan presentation, you need to come up with the “right” answers to these two questions.

Answering the first question means being fully conversant with all the details of your business plan and being able to point to the relevant financial statements, charts or graphs that will help convince the lender that you need the amount of money you’re asking for to do what you want to do.

Answering the second question means having already given some thought to the credit risk you represent to the lender and being ready to address his or her concerns.

To get a small business loan, be prepared to tell your potential lender:

What collateral you have – Collateral refers to the tangible assets that you are willing to put up to secure the loan. These assets might be equipment, a house, a car – something of value that you own. If you fail to repay the loan, then the proceeds from the sale of the assets is used for repayment.

How much money you’re personally willing to put into the business – Being willing to risk your own money shows the lender that you’re committed to the enterprise.

Your expertise and/or experience in your chosen field – Because the success of your business is dependent on this to some degree, any potential lender will want to know more about you. Be prepared to talk about yourself when you apply for a small business loan – your background, your expertise, and even your aspirations.

Your chances of getting a small business loan will be greatly improved if you have all your documents in order and are prepared to assuage the lender’s concerns about loaning you the money. Think of it as a presentation to an important client or customer, and you’ll have a better chance of success.

1) Your own pockets.

This may be daunting at first glance, but it’s the most popular source of business start up money. Don’t have a start up money nest egg? Many people get the business start up money they need by mortgaging or remortgaging their homes, or selling property or possessions – even those who do succeed in getting a start up business loan. Lending institutions and investors usually expect the person starting a business to make a personal financial commitment.

2) Family and friends.

The second most popular source of business start up money. Family and friends are often willing to provide a business start up loan or sometimes even an outright gift. After all, they’re likely to be already “pre-sold” on the value of your business idea to some degree, as your family and friends believe in you.

3) A line of credit.

While not recommended as a sole source of business start up money, a line of credit is essential for the start up phase. No matter how careful and detailed you’ve been in preparing your business plan, there are always unexpected expenses and expenses that you’ve underestimated.

Before you start a business, you should already have prepared the way to access this source of business start up money by having established a relationship with your local bank manager and by ensuring that your credit rating is in good shape.

4) A start up business loan from a bank.

I’m using the term “bank” to refer to a business start up loan from a traditional lending institution (such as banks and Credit Unions). It’s actually easier than ever to get a business loan, as more people than ever have been successfully starting small businesses and the big banks have more interest in small businesses than they used to.

That said, you can’t just walk in, tell a loans manager how much business start up money you want, and expect to walk out with it. Applying for any business loan is a process that you need to prepare for. See How to Get a Small Business Loan to learn how to make a winning loan presentation and get the business start up money you need.

Don’t overlook the BDC (Business Development Bank of Canada). Supporting business is their business and the BDC has several programs that directly address start up business loans, such as their CoVision program, which provides customized term financing up to $100,000 for new businesses demonstrating long-term viability.

5) A start up business loan from a business-related or government sponsored organization.

There are many organizations whose purpose is to promote economic development or provide assistance to help particular types of people succeed in business. Often (but not always) this assistance includes financial support, such as start up business loans. For instance, one of the ways the Canadian Youth Business Foundation, a non-profit organization, supports young entrepreneurs (aged 18 to 34) is by providing start up business loans of up to $15,000.

Many women’s organizations also provide financial assistance to women in business, including start up business loans. Alberta Women Entrepreneurs (AWE) is one such organization; you’ll find links to women’s organizations throughout Canada in my Women in Business library.

There are economic development organizations in place in every province and territory to provide support and services to entrepreneurs, including financial assistance. For example, in Ontario, Community Futures Development Corporations (CFDCs) operate in selected communities in rural and Northern Ontario, while Community Business Development Corporations (CBDCs) serve rural Atlantic Canada.

And the Canada Small Business Financing Program (CSBF) provides term loans of up to $250,000 to help finance fixed asset needs through business loans made directly by a qualified lender (such as a chartered bank, caisses populaire, or credit union).

You’ll find more examples of organizations that offer business loans, including start up business loans, in the Small Business Loans library.

Continue on to the next page to read about three more potential sources of business start up money.

Here are three more possibilities for accessing business start up money that you should check into if you’re starting a business:

6) Participating in a government-sponsored business start up program.

If you qualify, this is the best way to start a business. Programs such as the Self-Employment Program (for unemployed Employment Insurance eligible individuals) and the Seed Capital ConneXion Program for Young Entrepreneurs (for young entrepreneurs in Atlantic Canada) not only provide start up money but invaluable assistance, such as mentoring and help developing your business plan. These are just two such start up programs; there are others.

7) Finding investors.

Angel investors, venture capitalists, or private lenders all may be excellent sources of business start up money for your new business. While it’s certainly more difficult in most cases to attract investors to a start up rather than to an established venture, it’s not impossible if you have the right business idea at the right time backed by an impressive business plan. See Prepare an Investor Ready Business Plan for more on tailoring your business plan to impress potential investors.

Government grant programs.

While this is often touted as a great source of business start up money, it’s not, because most start ups simply don’t qualify as you’ll see in The Truth About Small Business Grants in Canada. While there are government grants available, finding one that can provide start up money for your new business will be an enterprise in itself (which is probably why there are so many companies out there providing grant-finding services).

Those planning to start up “the right business” will have a much easier time finding government grant programs that may provide business start up money. For example, generating efficient, renewable energy is a priority of the federal government, so businesses involving Cogeneration (using one fuel to simultaneously produce heat and electricity) or renewable energy technologies will find more government grant opportunities than others. If you’re interested in pursuing a grant as business start up money, 5 Tips for Finding Small Business Grants can help narrow your search.

Which of these sources of business start up money is best for you? Probably, like most of the people who have started businesses before you, you’ll need a combination of business start up money sources to get the money you need to develop your business. You may even want to explore all of these. Whatever you do, however, don’t depend on your personal credit cards for the business start up money you need. It’s best to wait to start your business until you have the funds you need in place rather than crippling your new business financially and perhaps ruining your personal credit rating.

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By Susan Ward
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It’s time for you to accept running a business is going to be more of an investment than what you expect it to, every time. Apply your research and seek those who are producing from the industry you’re interested in then ask questions about marketing ideas, effective tools, and personal experiences. This will help you get an idea of what your investments into the business will be. Make sure to listen with intent because the tips you receive from successful people will structure your business and add value.

Learn about your competition extensively. Compare them to what you’re looking for, and keep note of the qualities you like. This can be easily done by subscribing to their newsletter and seeing what they offer. There are many business opportunities out there and to ensure your choosing the right one for you, just do your do diligence.

Be original and get into business for any other reason than to make money, this will help you succeed where others fail. For example, I know a woman that joined one of my networks; she was struggling financially and is sick with a condition so her prescriptions are a ridiculous amount a month. She joined this particular network because it offered free major medical health and life insurance. She is growing steadily with her business and adds new partners on a consistent basis. Now the same network but a different person who spoke of nothing but making lots of cash, still has no one signed up under them. In network marketing a large number of its participants fail, so cut your odds down by providing service, quality and customer satisfaction. Know you’re getting into business for yourself and money will
and always does follow.

Starting a business takes a lot of time and devotion, now is the time for you to forget about the 40 hour week and realize much more is demanded of you. In order to achieve wealth you must be willing to work hard, very hard, and long. For example, the other day I woke up at ten in the morning and stayed up working on my pc till almost 6 in the morning! The next couple of days I did this and noticed it not because I enjoy what I do and how I make my money. The same can be for you, just be devoted to growing as an individual.

Here’s a key factor in starting your own business, your organizational skills. While in business for yourself you need to keep accurate records for your taxes, banking and your own purposes. Keeping organized now will help you eliminate issues in the future, so make sure to keep your own records even if someone else is. This way you can reference your notes and quickly establish if there is a problem and fix it.

Many small business owners have family and friends working for them, and it’s because their loyal. If you don’t have a family of members all flocking to work for you rest assured you can find reliable, experienced employees from all different sources on the internet, and more. There is always an abundance of people looking for work so tapping into them is fairly easy.

Every business owner has a lawyer, accountant, and insurance agent, so you’ll need them too when you start your business. These professionals will become very handy to you and are an asset to getting things done.

Deciding if you should run your business is a big decision and should be made with a sound mind. Please keep note, there is no individual who will run your business the way you do, treat your customers with respect like you do, or watch your money like you do. The joy of owning a small business is having the power of decision, and it’s in your best interest to leave that power in your own hands, so keep others out of certain aspects and do the rest yourself. Anything else that needs to be done can be leveraged so don’t worry about it.

Lastly it’s very important you follow this and stay positive no matter what. Even when you fail, hurry yourself to get back up and accomplish it. If something tragic happens, immediately remove yourself mentally and locate the opportunity. There is opportunity everywhere, like an idea, and you can’t get rid of it, so use it. Please keep note, your direct influence will affect you (negatively or positively) and its time you surrounded yourself with likeminded individuals, these relationships are priceless because they are the ones that hold you and your business accountable, they discuss and spark ideas, and the support is limitless.

Above I have provided you with the necessary steps to starting a small business. But the real story begins when you take action and you place them into effect. I know as a new business owner you need networks and friendships of people that genuinely want to help you. A great resource for finding these people is the internet and can be done simply by completing a search. So start your business, take lots of action and have fun with it!

About The Author, D Sterlin

D Sterlin is known for newsletter The Dot! which provides tools, programs and more to business owners free. She is an advocate of taking action and is directly contributing to the community with her insght and marketing techniques. For more information on D Sterlin see http://www.dsterlin.com

Your competition may be getting a hand up on you in many different ways. A new product, head office support, advertising agency, newspaper promotion, coupons, etc. Rarely though do I find small independent businesses making use of the most cost effective communication medium available – The Internet.

If you are a small business and do not have an ongoing marketing effort online, you are most certainly handing customers over to your competition. In fact, you might as well gift wrap them and send them over with a sticky note on their back saying “Can you take this buyer? I don’t really need a buyer today.”

Smart small business owners these days know how valuable a buyer can be, not just their first visit, but for repeated visits and then for bringing in other customers. But you need more and more of them as your business competition gets tougher and tougher. That’s why the internet is so perfectly suited for the future of your small business marketing.

It’s inexpensive to setup (if you do things right that is), and there are ways to reach any potential customer you want, and communicate your products and service directly to that person. You can even direct your message to potential customers in a specific geographic area whether that be near your location or clear across the continent.

What a lot of small business owners don’t realize is that it isn’t as difficult as it seems to set up a website, (an effective website that is), get it noticed in the search engines and then start building an online clientèle that will eventually come through your doors. Maybe its a few half-days of work. You can get your family involved or even a staff member or two during their down time. Everybody loves special assignments, especially if it’s out of the ordinary routine. The thing is once it is set up, it pretty much runs itself and can be your best selling employee working non-stop with no wages, no benefits, no holidays, and no drama.

Once you get an internet presence working for you and have it as part of your everyday sales system your competition will soon be wondering: Where do you get all those customers from?

About The Author, Marty Shmanka

Marty Shmanka is currently a webmaster but as a former restaurant owner
knows the challenges of owning a small business. His website
ShoestringIngenuity.com takes the mystery out of good small business website

design or restaurant

website design and uses video instruction to show you how you can do

it yourself and save thousands of dollars. It`s a lot easier than you

think.