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July 18, 2019

How Much Money Do You Need To Start A Business?

Startup capital is a necessity for virtually all businesses. However, the cost to start a business varies widely depending on what kind of business you are starting. For example, a home-based endeavor such as a dropshipping company or an Amazon business can cost less than $1,000 to get off the ground; the same goes for a business that doesn’t require an office or much equipment, such as a pet sitting business. On the other hand, opening a business that requires more equipment and office space—such as an autobody shop or a coffee shop—could cost $100,000 or more.

In this post, I’ll go over the main costs associated with starting a business and what you can expect to pay for each of them.

Surprisingly, there aren’t too many official statistics available on how much it costs to start a business, probably because the costs vary so much. There was a study conducted by the Ewing Marion Kauffman Foundation way back in 2009 that found the average cost to start a business at that time was $30,000.

Below, we’ve put together our own startup business cost figures, but keep in mind that the amount you’ll spend will vary greatly depending on various factors, such as your industry and location.

Common Small Business Expenses

Startup Expense	Estimated Cost
Business Licenses & Permits	$200
Business Insurance	$1,000 (annually)
Equipment & Supplies	$10,000
Inventory	$1,500
Office Space & Utilities	$5,000 initially, then $2,000 monthly
Employees	$8,000 (monthly)
Marketing	$700 initially, then $200 monthly
Business Software	$200 (monthly)
Professional Services (e.g., legal services)	$600
Misc. Other	$1,000
Total estimated cost: $28,200

Business Licenses & Permits

As a new business owner, you will need to register your business in your state and apply for a local business license/permit in your city or county. Depending on your industry, you may also need to obtain an industry-specific business permit. These initial business registration costs are usually minimal (less than $500).

Business Insurance

There are several types of business insurance for startups and which type(s) you need depends on various factors. Insurance is a significant, ongoing business cost. Most businesses will need general liability insurance and business property insurance, and if you have employees, you will also need to pay for workers compensation insurance and health insurance. Commercial vehicle insurance and product liability insurance are some other business types you may or not need.

Equipment & Supplies

All businesses require some sort of equipment or supplies, but these costs vary significantly depending on what type of business you have. Examples of equipment and supplies include:

Restaurant kitchen equipment
Office furniture
Office supplies
Business vehicle(s)
Medical equipment & supplies
Computers
Product manufacturing equipment
Point of sale equipment (cash register, credit card reader, etc.)

The type of equipment and other materials you need to run your business really depends on your industry—for example, if you’re starting a wedding planner business, you’ll probably just need a computer and office supplies, whereas a trucking company will need commercial vehicles, etc.

Office Space & Utilities

If you need to rent or buy an office space, this will be a significant ongoing expense, and a big startup cost too, as you will need to pay a security deposit, first and last month’s rent, etc. Internet, gas and electricity, a business phone, and data plans will also factor into the infrastructure costs of your office space. Most businesses start out as home-based or rent a business space initially, instead of purchasing or building property.

Inventory

If you sell a physical product, you need a certain amount of inventory to start out with (and have on-hand on an ongoing basis). Retail stores need a certain number of finished products on hand, while food-based businesses such as food trucks, for example, need to stock up on raw ingredients before they can open up shop. This, of course, does not apply to information-based businesses, such as consulting businesses or various other service-based businesses.

Employees

You may or may not start your business with any employees. If you do have employees, you need to factor in payroll costs, payroll taxes, insurance costs (workers comp. and health insurance), and training costs.

Marketing

Modern business marketing includes not only business cards, advertisements, signage, etc., but also digital marketing costs such as SEO, social media marketing, and website maintenance costs. As far as your digital marketing, at the very least you will need a website and social media presence. Tip: Be sure you register your domain early on in the process of starting your business, as your website will be the foundation of your online marketing.

Business Software

Some different types of business software you might need to launch and run your business include:

Accounting software
Booking software
POS softwareÂ
eCommerce/shopping cart software
Invoicing software
Inventory software
ERP software
Website builder software
Project management software
Shipping software
Email marketing software
Industry-specific business software (for example, specialized software for dentists, auto mechanics, etc.)

Some small business software programs combine multiple functions. For example, a restaurant management software system might include POS functionality as well as accounting, inventory, employee management, and maybe even email marketing functions. An accounting program like QuickBooks combines accounting, payroll, and invoicing functions, with POS functionality as an add-on.

Generally, most business software apps are no longer large programs that you install onto a computer as a one-time expense; rather, today’s business software is usually app/cloud-based, meaning you can sign in from any internet-connected device. And rather than paying for the software as a large, one-time expense, today’s software-as-a-service (SaaS) model is based on monthly payments with no down payment or long-term commitment. So, initial investment for business software will likely be much less than you would have paid for a comparable program 15 or 20 years ago. Some business software is even free to use.

In addition to software, don’t forget to factor in the cost of the associated hardware you’ll need to run the software into your equipment costs. For example, most businesses will need point of sale equipment, a laptop or iPad, a wireless router, etc. For very small businesses requiring only a basic app to take payments, it’s possible that the only hardware you might need is your smartphone.

Professional Services

This category can include legal fees, consultancy fees, accountant fees, and fees for any other professional services you use to help launch your business. While some businesses require minimal professional services, most businesses should at least consult a lawyer and/or professional accountant during the startup phase.

Other Costs

You’ll more than likely find out that there are more startup costs than you initially anticipated. Thus, it’s important to have a certain amount of your budget set aside for miscellaneous expenses that will inevitably come up. Some various costs you’ll need to include in your budget may include:

Organizational dues
Travel costs
Shipping fees
Loan interest
Repairs/renovations
Credit card processing fees (once you start making sales)

Of course, you’ll also need to make sure you have enough money to support yourself before your business becomes profitable, so make sure this cost is included as well.

How To Calculate Startup Costs

The SBA has a very useful startup cost worksheet that outlines common business startup costs with sample figures that you can personalize to calculate the true cost of starting your business. Simply enter the estimated cost for each category (rent, utilities, inventory, employees, etc.) and you’ll be able to get a rough estimate of how much money you might need for your initial investment.

It’s also a good idea to make a sales forecast, in which you estimate how much you will sell in the first 6â12 months of opening your business. How long will it take for your business to make a profit? How long ’til you can pay off your startup expenses? With your prospective revenue in mind, you’ll have a better idea of how much you can afford to spend on ongoing expenses such as payroll and inventory.

If the total seems unaffordably high, look for areas you might be able to cut costs. For example, could you operate your business out of your home for the first six months? Could you subcontract workers instead of hiring employees? Could you use dropshipping to deliver goods to customers directly from the manufacturer, instead of buying inventory upfront?

Once you have a good idea of how much startup capital you might need for your first 6â12 months in business, you can decide how you will finance your venture.

What To Do If You Donât Have The Money

Startup funding can be difficult to procure from a traditional bank, especially if you don’t have any significant assets or previous experience owning a business. However, that doesn’t mean you don’t have any options. Online technology has actually made it a lot easier to find small business funding. Here are some options you might try to finance your business.

Online Loan: This category includes both online business loans and online personal loans. Generally, online business loans for startups are limited to short-term, high-interest loans; you won’t qualify for better terms unless you’ve been in business at least two years. Still, it’s definitely worth looking into to see what kind of loans and rates you might qualify for. Some online lenders might even offer access to SBA loans for entrepreneurs, such as SBA microloans. Look at our startup business loan comparison chart to find some startup-friendly loan options.
Business Credit Cards: If you just need a few thousand dollars to get started, a business credit card can be a smart choice. You can use a business credit card to charge startup expenses, and/or to get a cash advance (though make sure you check the terms on the advance because they usually charge high interest). You could also use a personal credit card, though business credit cards typically have more business-specific benefits, such as cash-back for common business expenses. Look at our best small business credit cards comparison to see some of the top business cards’ requirements and perks.
Equipment Financing: If your main startup expense is the equipment you’ll need to run your business — for example, restaurant kitchen equipment, manufacturing equipment, office equipment, etc. — then you can simply finance the equipment itself, in the form of an equipment loan or lease. Similar to automotive financing, equipment financing involves monthly payments (either to lease or own), and does not typically require good credit or any collateral other than the equipment itself. Check out our equipment financing comparison chart to see your best options.
Line Of Credit: A business line of credit is similar to a credit card in the sense that you can have it on hand to pay for expenses, but you only have to repay what you use. Like a business loan, you can get a line of credit from an online lender or a traditional bank. However, startups will have better luck finding a line of credit online; there are several online line of credit providers that only require only 6 or fewer months in business, whereas banks typically will not extend a line of credit to startups. Check out our line of credit comparison page to find some startup-friendly LOC options.

Other startup financing ideas:

Loan from friends/family
Crowdfunding
Seed investors
Business grant
Nonprofit lenders
Personal retirement savings— rollover a retirement account using a ROBS (rollovers as business startups) plan

Our team at Merchant Maverick has also written many informative articles about startup financing that can help you on your journey:

Crowdfunding For Startups: 8 Tips For Launching
Don’t Let Bad Credit Stop You From Getting A Startup Loan
The Best Business Cards For Startups And Entrepreneurs
SBA Loans For Startups
How To Find A Startup Grant
14 Types Of Alternative Financing For Small Businesses
The Best Business Credit Cards For People With Bad Credit

Tax-Deductible Startup Costs

If your total startup costs are $50K or less, you can write off up to $10,000 of startup costs on your taxes in the year that you start the business, including up to $5,000 in business startup costs and another $5,000 in organizational expenses (legal fees, state incorporation fees, etc.). If your startup costs exceed $50,000, the amount of your allowable deduction will be reduced by that dollar amount, and if your startup costs are more than $55,000, you are not eligible for the deduction.

Certain startup expenses are not tax-deductible—for example, the costs to qualify for doing business in your industry, such as real estate licensing costs, are not deductible as a startup expense. Additionally,Â business assets (one-time business expenditures such as vehicles and equipment) are not deductible as startup expenses, but may be deductible in a different category (amortization).

(In case you were wondering, business loan interest is, indeed, tax-deductible.)

Final Thoughts

It may be a cliche, but it is also true that “it takes money to make money.” Startup business costs can range from under $10K to over $100K, depending on a number of factors. It’s okay if you don’t have all the money right now: the important thing is to put together an accurate estimate of how much you will need, what you will spend the money on, and how/when you’ll be able to repay any borrowed monies with your revenue. You can then incorporate this estimate into your business plan and the loan proposal you will use to demonstrate to lenders that you are a good candidate for financing.

With the numerous financing options available to entrepreneurs these days, there is a great chance that if you have a sound business plan and accurate, reasonable startup cost estimate, you will be able to find a lender that can meet your startup financing needs.

The post How Much Money Do You Need To Start A Business? appeared first on Merchant Maverick.

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July 17, 2019

Business Line Of Credit Requirements You Should Know Before Applying

Looking for a flexible form of funding for your business? A business line of credit just may be the answer. Unlike a traditional loan, a line of credit works similar to a credit card. A lender assigns you a set credit limit based on a number of factors. You’re able to make draws on this line of credit up to your set credit limit. You may make just one large draw or several smaller draws as long as you don’t exceed your credit limit.

If you have a revolving line of credit, you have even greater access to capital. With a revolving line of credit, funds are replenished as you pay down your balance, giving you access to funds again and again. You can use your line of credit as working capital, to hire new employees, to cover an emergency expense, to fill seasonal revenue gaps, or for any other business expense.

In addition to the flexibility of lines of credit, business owners and entrepreneurs also frequently receive fast funding. Some lenders give approvals for lines of credit in just minutes, giving you instant access to the capital you need right when you need it.

In this post, we’re going to explore the requirements for receiving a business line of credit. We’ll cover what lenders look for when approving your application and determining your credit line. We’ll also discuss the documentation required by most lenders. Before you start seeking out lenders, read on to better prepare yourself for the process.

What Does It Take To Qualify For A Line Of Credit?

One of the benefits of a line of credit is that there are options available for nearly any business. Because lines of credit have shorter repayment terms than many other forms of funding, borrowing requirements are often more lenient. However, this varies among lenders. Traditional lenders like banks typically offer lower rates and better terms but have more requirements, including a solid personal credit score. Some alternative lenders focus on the performance of your business and may not even consider your business or personal credit history but may have higher rates, more fees, and less favorable terms.

To qualify for a line of credit, you should, at a minimum, have a time in business of at least 3 months. However, some lenders may require a longer time in business — think 6 or 12 months — in order to qualify. You will also need to show proof of business revenue in order to qualify. At a minimum, your business should have at least $50,000 in annual revenue. Again, though, the lender you select may have higher minimum revenue requirements of $100,000 or more per year.

Even if you meet the minimum requirements of a lender, it’s important to remember that this doesn’t guarantee you’ll be given a line of credit. Since the performance of your business is an important qualifying factor, only meeting the minimum requirements may score you an approval, but you may be given a lower credit limit. In other words, don’t expect to receive the maximum borrowing amount if you have low revenue and a short time in business.

While some lenders use the performance of your business as the primary factor for approval, many also take a look at your personal credit profile. Lenders use your credit to determine if you’re a risky borrower. Some lenders, for example, won’t approve applicants with recent bankruptcies, liens, or defaults on loans. Others only approve applicants with a fair to excellent credit score. Your credit profile may also be used to determine your rates, fees, and maximum borrowing amount. This varies by lender, so ensure that you meet all credit qualifications before hitting “Submit” on your application.

Some lenders also take a look at your business credit profile, although it’s more common for the lender to consider your personal credit history. If you haven’t yet built up business credit history, find a lender that doesn’t have this requirement. If you have a solid personal credit score and history, applying for a personal line of credit to be used for business expenses may also be an option.

You should also be prepared to put up collateral for your line of credit. Generally, this means that you’ll sign a personal guarantee or have a blanket lien put on your business. A personal guarantee is just what it sounds like: you’re taking personal responsibility for paying back the line of credit. If you default, personal assets may be taken. A blanket lien is similar, only it covers the assets of your business. If you default on payments, the lender has the right to seize business assets to repay the debt.

How Lenders Evaluate Eligibility: The 5 Cs Of Credit

As previously mentioned, lenders evaluate the risk of borrowers when determining if you’re approved for funding, as well as the rates, fees, and terms of your financial product. To evaluate risk, lenders look at the 5 Cs of credit.

The first C stands for character. In other words, are you trustworthy? Your credit score and history are a good measure of character. Some lenders may also require a personal interview or may reach out to your references to get a better grasp of your character.

Next, lenders look at your capacity — whether you’re able to afford the financial product you’re applying to receive. Lenders evaluate capacity by looking at factors including incoming cash flow, current expenses, debt-to-income ratios, and debt service coverage ratios. This information is also used to determine your maximum borrowing amount.

The next C on the list is capital. Have you invested in your business? If so, you have something to lose if the business goes under. An investment of your own capital gives a lender more confidence that you’ll work to make your business successful … including paying off your debts.

The fourth C stands for collateral. Collateral is personal or business assets used to secure the loan. If you don’t pay the lender, they have the right to seize this collateral. While your lender may not require specific capital, expect to sign a personal guarantee or have a blanket lien put on business assets.

Finally, lenders evaluate conditions. This includes the state of the economy, your industry, principal, interest, and other factors. If conditions aren’t favorable, you may not qualify for funding, or you may qualify to receive a smaller amount than you applied to receive.

Want to know more about how lenders evaluate risk? Learn more about the 5Cs of Credit.

Documents Needed To Apply For A Business Line Of Credit

Your lender may require you to submit documentation at the time of application. Other lenders may have additional documentation requirements further along in the process before approving your application and determining your credit limit. The documentation you need to receive a line of credit varies by lender, but let’s explore some common requirements so you can be prepared for the application process.

Driver’s License

Most lenders require a copy of your driver’s license or another form of government-issued identification to prove your identity.

Bank Statements

Business bank statements are used by lenders to show your revenue, incoming cash flow, and expenses. Expect to submit statements from at least the last three months, although some lenders may require bank statements from the last 6 months or longer.

Financial Statements

Remember, lenders are all about risk, so some may require additional financial statements that reflect the performance of your business. This documentation may include but is not limited to balance sheets and profit and loss statements.

Tax Returns

Some lenders may require personal and/or business tax returns during the application process. You should plan to have access to at least the last three years’ worth of returns.

Articles Of Incorporation

You may be required to show the Articles of Incorporation, business licenses, or other proof of ownership for your business. Some lenders also require the signatures of all owners before issuing a line of credit, so make sure you know your lender’s specific requirements.

Proof Of Collateral

If specific collateral is being used to secure your line of credit, documentation showing the proof of collateral may be required. If specific collateral is not required, remember that you may be required to sign a personal guarantee or agree to a blanket lien before using your line of credit.

Voided Business Check

A voided business check may be required by your lender. This is primarily used to verify bank account information, particularly when automatic payments will be withdrawn from your account.

Credit Reports

Most lenders will pull your personal credit report to determine if you qualify for a line of credit. While you won’t necessarily need to submit your own credit report, this is good to have on hand so you can understand your score and any potential obstacles to funding. For certain lenders, such as banks and credit unions, you might also want to pull your business credit report as well. Learn more about receiving your free credit score online.

Final Thoughts

A line of credit is a great way to fill revenue gaps, cover unexpected expenses, or to use for expansion of your business. However, as with other financial products, make sure to shop around for the best rates and terms for your business. Once you’ve narrowed down your lender choices, keep an eye on fees, hidden costs, and the total cost of borrowing to determine if getting a line of credit is a smart financial move for you.

Unsure of where to start when it comes to finding a line of credit? Start your search with our list of the best business lines of credit. If credit challenges have prevented you from getting funded elsewhere, check out our post, The 5 Best Business Lines Of Credit For Bad Credit.

The post Business Line Of Credit Requirements You Should Know Before Applying appeared first on Merchant Maverick.

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July 16, 2019

What Is Square And How Does It Work?

We at Merchant Maverick like Square. Itâs a great service that opens up the ability to process credit card payments to many small businesses, and weâve written a lot of articles about Square’s point of sale, payment processing, inventory, booking, and invoicing features. These articles can be prohibitively in-depth to the uninitiated, however, so you might want to read this quick overview of Square for a summary before digging into the details.

A Brief History Of Square

Square was founded in 2009 when Jack Dorsey (also of Twitter) tried to help his friend Jim McKelvey take a credit card payment of $2,000.00. Squareâs first product was a magnetic stripe credit card reader that could be inserted into a smartphoneâs headphone jack to take credit card sales.

Square became a public company in November of 2015, and its stock is traded on the New York Stock Exchange under the ticker symbol SQ. While Square does bring in a lot of money ($3.3 billion for the year 2018), it still has not made a profit. For the moment, the company seems to be more focused on growing by adding new services for its customers.

While Square’s main focus continues to be helping small businesses quickly and easily set up taking credit card payments, it has also expanded its services to point of sale, inventory, and employee management — giving small businesses the ability to run more like large ones (more on these services below). To this end, it has bought the food delivery business Caviar, the catering service Zesty, and the website building service Weebly. It also owns a consumer-centric digital wallet called the Cash App, where users can send money to each other and even buy from any store with the money in the app.

In the span of about ten years, Square has grown from a startup focusing on one aspect of helping small businesses grow to a large business providing a suite of services that help small businesses expand. With so many additional services, what exactly does Square do these days?

What Does Square Do?

At its heart, Square is still a credit card processing aggregator (also sometimes called a third party payment processor or a payment service provider (PSP)). We have a great article on the difference between a merchant account provider and an aggregator, but below is a quick explanation.

Square’s Credit Card Processing Services

Traditionally, if you want your business to take credit card sales, you would work with a provider to set up something called a merchant account. To get a merchant account, you typically undergo a long application process and provide a lot of financial information before you are approved. These providers want to make sure that, based on your businessâs existing history, you don’t present a huge financial risk.

Credit card processing aggregators take more of a see-as-we-go approach and assume financial risk for bad accounts. Aggregators merely need to verify the identity of the applicant before authorizing a new account, and generally don’t ask too much more information. They have more freedom on who they sign up and how they do business with those they sign up.

While this means aggregators can quickly set your business up to take credit card payments without needing an established history, they tend to be cautious afterwards. These types of payment processors have advanced systems in place to analyze each transaction for any red flags. Suspicious transactions can cause the processor to hold funds until it has more information. Worse, third-party processors often have a clause in the contract that says they can terminate your account if they see fit. Usually, this happens to businesses that have high numbers of chargebacks or fraudulent transactions.

Square is an aggregator, so essentially the above is its business model. You can sign up for Square within minutes and without providing detailed financial information. In addition, Square gives you a basic set of free hardware and software so you can start taking credit card payments almost right away. The free items include:

Square Point Of Sale Software: Square’s free POS software is incredibly advanced for being free, though it’s certainly not a full-fledged POS. Still, for most small businesses it is more than sufficient. Square also offers premium iPad POS systems for a monthly fee if you need more advanced features.
Credit Card Reader: You can get a basic magnetic strip reader for free, but if you want support for chip cards, you’ll have to upgrade to another reader, which will cost you.
Invoicing: For those businesses that bill a larger amount but less often (e.g. lawn care services), Square offers an electronic invoicing function. The invoices are free to send, but you will pay a transaction fee when your customer pays with their card.

Square’s Value-Added Services

As mentioned earlier, Square has been adding more services to its core credit card processing business. Some of these services are for free, but others are available for a small fee. These services include:

Employee Management: With this service, you can manage your employees from anywhere. You can add new employees to the system, track their hours, track their register/sales (at either single location or multiple locations), edit and close employee timecards, and give selected employees selected access to various parts of this software (e.g. so they can enter their own hours but not see your weekly sales numbers).
Payroll Services: This service imports data from the employee management software so that you can easily pay your employees and contractors. Square will handle tax filings and withholdings, and they can handle the payments to other employee benefits such as health insurance and 401(k). You can even offer direct deposit to your employees.
Inventory Management: Square offers basic inventory management in its Point of Sale app for free, but the premium iPad POS systems offer a more detailed system that can track and analyze your business’s inventory across multiple stores and multiple registers. You are notified when inventory is low, and items are automatically removed from inventory when they’re sold, whether at one of your physical locations or online.
Business Debit Card (Square Card): When you are paid by your customers through Square, the money goes to an account kept by Square. Rather than moving the money to your bank, you can use it immediately with the Square Card. The Square Card is a debit card sponsored by Mastercard, and you can request it from Square for free. Check out How Does Square’s Instant Deposit Work?Â for more information about how to access your funds.
Appointments: Square provides a booking calendar for professional service businesses (like hair salons). The calendar not only tracks and moves appointments, but it can also send appointment reminders to customers. The POS and booking system is free for a single user, but if you have multiple users you’ll need to pay a monthly fee.
Square Online Store: Pretty much every business needs an online presence, and Square can help you build a professional-looking website even if you’ve never done it before. Square provides tools that can help you track your inventory sold through your online store and helps you with shipping (printing labels, discounted rates). Best of all, when you sell out of state, it tracks all the different sales taxes that you might owe. There’s a basic free webstore, but if you need more advanced features, you’ll need to upgrade to one of the other plans.
Other Services: Square offers many more services designed to make a small business owner’s life easier. For instance, Square offers marketing software to help you build email and social media advertising campaigns. It has an installment payment service for certain businesses so that a customer can buy a big-ticket item and pay Square in installments while you get paid right away. Square can help you build a loyalty program where customers can redeem goods or services with points. You can get your own branded gift cards to sell to your customers. Square even provides online store owners with a product photography service so that the items sold through webstores are presented in their best light.

As can be seen above, Square is well on its way to offering an entire suite of software and services that not only help you take credit card sales, but also help you manage your entire business’s operations.

What Are The Advantages of Square?

Every successful business has a few things it does extremely well, and Square is no exception. Square basically provides you with a free, fast, and easy-to-get-out-of way to start taking credit card sales. To elaborate a bit, the following are some advantages for signing up with Square:

Fast Setup: You can sign up for Square within minutes and get a credit card reader shipped to you very quickly.
Easy Termination: If you sign up and find that you don’t like Square, you can stop working with Square any time you want. There are no penalties for leaving, so you can sign up without fear. (There may be loose ends to tie up, but you can still terminate the services at will.)
Easy To Use: Square is focused on small businesses that are just starting out. They provide a simple piece of hardware and intuitive software to help you run your business and help you grow.
Simple Fee Structure: Compared with other pricing models, Square has an easy-to-understand flat fee structure so you can better predict your profits.
Fast Payment: With Square, you can get paid almost right away after a customer makes a charge. You can instantly deposit these funds into your outside account or use the funds directly with the Square Card debit card. In contrast, traditional merchant account providers typically hold the funds for at least 24 hours before releasing it to you. For a small business with tight cash flow, Square’s fast payment can make a difference to the business’s survival.
No Minimums Or Monthly Fees: A small fee here and there might seem insignificant, but they can add up in the long run. Square’s credit card processing service (and a lot of their other services) have no minimum or monthly fees, so a small business doesn’t have to worry about paying for anything other than the transaction processing costs.

These are just some of the advantages for signing up with Square. Of course, no business is perfect, and neither is Square. Under some circumstances and for some types of businesses, Square is not the best option.

What Are The Disadvantages Of Square?

No business can be everything to everyone, so Square is not suitable for every type of business. One of the biggest complaints we see about Square is that Square sometimes withhold funds in a merchant’s account, with or without warning. Sometimes, you never get paid. If you fit into one of the categories below, you might want to think twice before signing up with Square:

Not Suitable For High-Risk Businesses: A “high risk” business is usually defined as a business that deals with guns and ammo, tobacco and vaporizers, pharmaceuticals, gambling and financial services, and similar — anything highly regulated or prone to chargebacks and disputes. If you deal in any of these, Square is likely not the right business partner for you. Specifically, in its Terms of Service, Square reserves the right to terminate service if you violate any export control regulations (for example, sell military-grade items to specific countries) and money laundering laws, sell weapons or devices designed to cause physical harm, or “use the Services except as otherwise allowed” under their agreements.
Not Suitable For Business With Many Chargebacks: If you have a business that causes a high rate of dispute or chargebacks (even if it’s not otherwise a high-risk business), then Square is probably not the right company for you. Going back to Square’s business model, it fronts you the money that you take from your customers so you can collect right away while it waits for the banks to settle the charges. So, if Square can’t eventually get the money from the banks, it might stop fronting you the money (put a hold on your account) or stop working with you altogether.
Not The Best Pricing For High-Volume businesses: Despite its transparent pricing, Square might not be the cheapest service provider for your particular business. If your business is mature, you have an established financial history and are doing a consistently high volume of card payments, and you know how your customers tend to pay for your goods or services, then you might want to shop around a little more to find the merchant account provider that can offer you interchange-plus pricing and volume discounts. (That said, Square does negotiate custom rates for high-volume businesses, but you should absolutely shop around all the same.)

We have an article that gives more details on why Square is not suitable for high risk and high chargeback businesses. If you have an established business and wish to shop around, here’s some information on where you might be able to get a better deal.

What Are Square’s Fees?

Business owners like having predictable operating expenditures every month. Because credit card fees usually have a percentage component and a flat fee component, the cost of allowing credit card sales tend to be less predictable. Compared to traditional credit card processors, however, Squareâs fees are easier to predict.

With Square, you usually only have to worry about just one fee, expressed in a percentage form. Right now, if you use Squareâs free credit card reader and free Point of Sale software, you pay 2.75% of the sale. Thatâs it. If your customers choose to pay online, your rate is 2.9% + $0.30 per transaction.Â Having only to keep two numbers in mind makes it easier for you to figure out your markups so you can make a profit for your entire business.

Note, though, that if you use Squareâs premium hardware or software, the charges can get a little complex. Here’s an article giving a more detailed breakdown of Square’s fees.

How Do You Use Square?

When it comes down to it, it’s fairly easy to start using Square’s services. You can do it in four steps:

Sign Up For A Free Account. This only takes a few minutes, and we even have an article walking you through the process. You wonât have to provide a lot of financial information, and they wonât do a credit check on you at this stage (they will later, after youâre all set up).
Get Your Free Square Reader. Youâll have quite a few hardware choices–some of which you will need to pay for–but thereâs always one thatâs free for either iOS or Android.
Download The Free Square App. The app is called Square Point of Sale, and you will need this app to process payments through a mobile device.
Log In To The Free Square Dashboard And Explore. This is a fairly robust piece of software that manages all your credit card charges. You can customize reporting in a centralized hub, and do much, much more (some of which cost extra). Here’s a Merchant Maverick article on the details of the dashboard.

As mentioned above, Square wants to help you run your business. There are a lot of value-added services they offer, so once you’re all set taking credit card sales, you might wish set aside a little time to explore these additional services to see how they can help you run your business.

What Kinds of Businesses Is Square Best For?

Square isnât right for every business, but if your business is small or new, Square is very likely the best bet for you. With Square, youâll get lots of free software, hardware, and add-ons to get you up and running very quickly. You can use Square on the web, at a brick-and-mortar store, and even at mobile locations such as food festivals.

We’ve compared Square with PayPal and Clover Go and believe Square really does offer the best value for the price for a start-up business. As long as youâre not one of the âhigh riskâ businesses, you should have no problems getting payments from Square or with your account being abruptly suspended or terminated. Best of all, if you use Square and then after a while decide you donât like them, you can stop using them at any time.

Is Square right for you? This more in-depth article can help you decide.

The post What Is Square And How Does It Work? appeared first on Merchant Maverick.

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July 11, 2019

Top Credit Cards With Airport Lounge Access

Airports are not places of emotional respite and quiet contemplation. Airports are angry, crowded, chaotic, exploitative places where anxiety thrives like bacteria on picnic potato salad. Heavily-policed cathedrals of dread and frustration where the malware-ridden charging stations are all occupied and a mediocre sandwich costs 12 bucks. The modern airport experience distills and concentrates the existential toxicity we spend our lives trying and failing to avoid.

Wouldn’t it be nice if there were something you could do to make airports less awful? As it turns out, for a price, there is.

Most airports have lounges where you can take refuge from the rest of the airport. While airports differ in terms of the lounge benefits they offer, these benefits typically include complimentary snacks and drinks, free wi-fi, computer workstations, comfy seating, and other luxury amenities. Some even offer full spa treatments!

You can just pay to get into these lounges, but if you use them with any frequency, this will cost you quite a bit. Thankfully, some travel credit cards come with complimentary airport lounge access, entitling you — and up to two companions, in most cases — to use these lounges and enjoy their benefits. While these cards normally carry a high annual fee, you’ll still come out ahead if you use these lounges often enough. Plus, premium travel cards offer a host of additional benefits, like travel protection, the ability to earn points or cash back, and more.

Read on to get the details of the top travel credit cards with lounge access. Hopefully, you’ll find one that appeals to you!

Credit Card	Annual Fee	Lounge Access
The Platinum Card from Amex	$550	Amex Centurion, Priority Pass, Delta Sky Clubs, Airspace
The Business Platinum Card from Amex	$595	Amex Centurion, Priority Pass, Delta Sky Clubs, Airspace
Mastercard Black Card	$495	Priority Pass
Chase Sapphire Reserve	$450	Priority Pass
Citi / AAdvantage Executive World Elite Mastercard	$450	American Airlines Admiral’s Club
Hilton Honors Amex Aspire	$450	Priority Pass
Hilton Honors Amex Ascend	$95	Priority Pass

The Platinum Card from American Express

The Platinum Card from American Express Compare	Annual Fee: $550 Purchase APR: N/A (charge card)
Required credit: Good, excellent Bonus offer: 60,000 points after you spend $5,000+ on purchases in your first 3 months Purchase intro APR: N/A (this is a charge card) Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 5 points per dollar spent on flights booked directly with airlines or with American Express Travel 5 points per dollar spent on prepaid hotels booked on amextravel.comâ¨ 1 point per dollar spent on all other eligible purchases Notable perks & benefits: Get access to over 1,200 airport lounges worldwide via theÂ American Express Global Lounge Collection Receive a statement credit every 4 years after you apply for Global Entry ($100) or TSA PreCheck ($85) Use Membership Rewards Pay with Points for a First or Business class flight with any airline available through Amex Travel and get 35% of the points back Get $200 per year in statement credits for incidental fees with the qualifying airline of your choice More card details (click to expand) Hide

The Platinum Card from Amex earns first mention from us in this article. Why? Because no other credit card out there (with the exception of the business version of this card) gets you access to as many airport lounges as this one.

With Amex’s Platinum Card, you’ll gain access to the American Express Global Lounge Collection, which includes the following airport lounge networks:

Amex Centurion — Typically rated as the most luxurious of the bunch, Amex Centurion lounges can be found at 8 domestic airports and 8 non-US airports
Priority Pass — Priority Pass is the world’s biggest airport lounge network with over 1,200 locations across 130 countries
Delta Sky Clubs — You must be flying with Delta to take advantage of these lounges
Airspace — Airspace lounges can currently be found in just two airports, Cleveland and San Diego

The Platinum Card gives youÂ and up to two companions free access to these lounges. Not too shabby!

The airport lounge benefits are only the beginning of the perks you’ll be able to access. You’ll earn 60,000 Membership Rewards points after you spend $5,000+ on purchases within 3 months. You’ll get an annual $200 airline fee credit to cover incidentals with an airline of your choosing. You’ll get up to $200/year worth of Uber credits.

Shall I go on?

You’ll get 5X Membership Rewards points on a) flights booked directly with airlines or with American Express Travel,Â and b) prepaid hotels booked on amextravel.com. You’ll get a statement credit to cover the cost of applying for Global Entry or TSA PreCheck. You can use your points to book travel with amextravel.com and not have to deal with blackout dates or seat restrictions. You’ll even get complimentary benefits with an average total value of $550 with Fine Hotels & Resorts.

As you can see, the Amex Platinum Card carries a great many high-value benefits (and I didn’t even list them all!). However, these benefits don’t come cheap, as the card carries a $550 annual fee. Now, keep in mind that every other card featuring this level of free airport lounge access also carries a hefty annual fee (over $400). Of course, in order to come out ahead financially with any of these cards, you’ll have to fly often enough to take full advantage of your travel benefits.

Keep in mind that this is a charge card — you have to pay your balance in full each month.

The Business Platinum Card from American Express

American Express Business Platinum Card Compare	Annual Fee: $595 Purchase APR: N/A (this is a charge card)
Required credit: Good, excellent Bonus offer: 50,000 points after you spend $10,000 and an extra 25,000 points after you spend an additional $10,000 on all qualifying purchases within the first three months Purchase intro APR: N/A (this is a charge card) Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 5 points per dollar spent on flights and prepaid hotels booked via Amexâs travel website 1.5 points per dollar on eligible purchases of $5,000 or more â up to 1 million additional points per year 1 point per dollar on all other eligible purchases Notable perks & benefits: Get access to over 1,200 airport lounges worldwide via theÂ American Express Global Lounge Collection Receive a statement credit every 4 years after you apply for Global Entry ($100) or TSA PreCheck ($85) Use Membership Rewards Pay with Points for a First or Business class flight with any airline available through Amex Travel and get 35% of the points back Get $200 per year in statement credits for incidental fees with the qualifying airline of your choice More card details (click to expand) Hide

American Express Business Platinum Card

amex business platinum review
Compare

Annual Fee:

$595

Purchase APR:

N/A (this is a charge card)

Required credit: Good, excellent

Bonus offer: 50,000 points after you spend $10,000 and an extra 25,000 points after you spend an additional $10,000 on all qualifying purchases within the first three months

Purchase intro APR: N/A (this is a charge card)

Balance transfer intro APR: N/A

Foreign transaction fee: None

Rewards:

5 points per dollar spent on flights and prepaid hotels booked via Amexâs travel website
1.5 points per dollar on eligible purchases of $5,000 or more â up to 1 million additional points per year
1 point per dollar on all other eligible purchases

Notable perks & benefits:

Get access to over 1,200 airport lounges worldwide via theÂ American Express Global Lounge Collection
Receive a statement credit every 4 years after you apply for Global Entry ($100) or TSA PreCheck ($85)
Use Membership Rewards Pay with Points for a First or Business class flight with any airline available through Amex Travel and get 35% of the points back
Get $200 per year in statement credits for incidental fees with the qualifying airline of your choice

More card details (click to expand)

Hide

You guessed it: The Business Platinum Card from American Express is the business version of Amex’s Platinum Card. Naturally, the two cards are similar, but not identical.

The similarities? Both cards offer the same level of airport lounge access and largely carry the same travel perks, such as a fee credit for Global Entry/TSA PreCheck and a $200 airline fee credit. Also, both are charge cards.

The differences? The Business Platinum card has a slightly higher annual fee ($595) and no Uber credits. It also sports a higher signup bonus, though you have to spend more in order to get it in full. The Amex Business Platinum offers 50,000 points after you spend $10,000 in your first three months and another 25,000 points after you spend an additional $10,000 within those same three months.

The card’s points-earning structure is also a bit different: 5X points on airfare and prepaid hotels booked on amextravel.com and 1.5X points on purchases of $5,000 or more. All other purchases earn you 1 point per dollar spent.

As the Amex Business Platinum is a business credit card, you can get cards for your employees for no additional fee.

Mastercard Black Card

Mastercard Black Card Apply Now	Annual Fee: $495 Purchase APR: 17.24%, Variable
Required credit: Excellent Bonus offer: None Purchase intro APR:Â N/A Balance transfer intro APR: 0% for the first 15 billing cycles Foreign transaction fee: None Rewards: 1 point per dollar spent 2% value for airfare redemptions 1.5% value for cash back redemptions 1% value forÂ hotel stays and car rental redemptions Notable Perks & Benefits:Â 24/7 Luxury Card Concierge Luxury gifts fromÂ brand name companies Room upgrades, complimentary food and beverage, and spa credits when booking with Luxury Card Travel Travel benefits, including global luggage delivery,Â 24/7 chauffeured transportation, and private jet/yacht chartering services $100 annual airline credit Priority Pass Select VIP airport lounge access Global Entry & TSA PreCheck application credit More card details (click to expand) Hide

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The Mastercard Black Card doesn’t carry the same level of travel benefits as most of the other cards here, so it’s fair to ask how one can justify getting this card, given its $495 annual fee. Well, there’s one thing the Mastercard Black Card can offer that other travel cards with airport lounge access don’t.

The Mastercard Black Card gives you access to Priority Pass lounges via the Priority Pass Select program, but unlike other credit cards offering this benefit, the Mastercard Black Card bestows free access to Priority Pass lounges for both you and an unlimited number of guests. The other credit cards offering Priority Pass Select limit free lounge access to two companions with any additional companions subject to a fee for entry. If Priority Pass Select membership is of the utmost importance to you and you travel frequently with a sizable family or entourage, the Mastercard Black Card might be just what you’re looking for.

While the Black Card’s other benefits don’t quite live up to those of the other cards listed here, the card does offer 2% of your value back (in the form of points) for airfare redemptions and 1.5% value for cash back redemptions. You’ll also get a $100 annual air travel credit toward all flight-related purchases as well as a fee credit for Global Entry or TSA PreCheck.

Additionally, the card is made out of stainless steel, so it looks cool.

Chase Sapphire Reserve

Chase Sapphire Reserve Compare	Annual Fee: $450 Purchase APR: 19.24%â26.24%, Variable
Required credit: Good, excellent Bonus offer: 50,000 points after you spend $4,000 on purchases in the first 3 months Purchase intro APR: N/A Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 3 points per dollar spent on travel and dining at restaurants 3 points per dollar spent on travel worldwide immediately after earning your $300 annual travel credit 1 point per dollar spent on all other purchases Notable Perks & Benefits:Â $300 Annual Travel Credit 50% more value when redeeming points for travel via Chase Ultimate Rewards Travel and baggage delay insurance Auto rental collision damage waiver Trip delay reimbursement Purchase protection and extended warranty More card details (click to expand) Hide

Chase’s Sapphire Reserve card is a solid contender in the travel credit card race, offering free access to all Priority Pass lounges for you and up to 2 guests. The annual fee is $450, but in exchange, you’ll be entitled to some great high-value benefits.

The Sapphire Reserve has an impressive signup bonus of 50,000 points after you spend $4,000+ on purchases in the first 3 months. When redeemed for travel through Chase Ultimate Rewards, those points will be worth $750, as your points get a 50% value boost when you redeem them this way. You’ll also get a statement credit of up to $300 to cover your travel purchases each account anniversary year.

As far as ongoing points-earning goes, you’ll earn 3X points on all travel purchases after earning your $300 annual travel credit. You’ll also get 3X points on all restaurant purchases and 1 point for all other purchases. And yes, you’ll get a statement credit for Global Entry or TSA PreCheck.

With the Chase Sapphire Reserve, you can also transfer your points over to other leading travel loyalty programs on a 1:1 basis. Score one for points flexibility!

Citi / AAdvantage Executive World Elite Mastercard

Citi / AAdvantage Executive World Elite Mastercard Compare	Annual Fee: $450 Purchase APR: 17.99% – 25.99%, Variable
Required credit: Excellent Bonus offer: 50,000 American Airlines AAdvantage bonus miles after spending $5,000 in purchases in your first 3 months Purchase intro APR:Â N/A Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 2 miles per dollar spent on eligible American Airlines purchases 1 mile per dollar on all other purchases Notable Perks & Benefits:Â 10,000 AAdvantage Elite Qualifying Miles (EQMs) once you spend $40,000 in purchases within a calendar year 25% savings on in-flight food and beverage purchases on American Airlines flights Up to aÂ $100 credit every 5 years for Global Entry or TSA PreCheck Priority check-in, priority airport screening (where available) and boarding privileges for you and up to 8 companions on the same reservation First bag checked free on domestic American Airlines flights for you and up to 8 companions ComplimentaryÂ Admirals Club membership Dedicated concierge More card details (click to expand) Hide

Here’s a luxury travel card with lounge access for frequent American Airlines travelers. The Citi / AAdvantage Executive World Elite Mastercard’s main benefit is the access it grants you to AA’s Admiral’s Club program. Both you and your immediate family (or two unrelated companions) will get free access to the 50+ Admiral’s Club lounges around the world along with 60+ partner lounges.

While the card does carry an annual fee of $450, consider that a standalone Admiral’s Club membership costs up to $650/year for an individual membership and $1,250/year for a household membership!

The Citi / AAdvantage Executive World Elite Mastercard comes with a host of additional travel benefits. You and up to 8 travel companions will get one free checked bag on domestic AA flights, and if your companions are on your reservation, you’ll all enjoy priority check-in, priority airport screening (where available), and priority boarding.

You’ll also get 25% savings on inflight food and beverage purchases on AA flights, a statement credit to cover your Global Entry or TSA PreCheck application fee, 50,000 AAdvantage miles when you spend $5,000+ in the first 3 months, 2 miles for every dollar spent on AA purchases (1 mile per dollar spent on everything else), dedicated concierge service, and more.

Hilton Honors American Express Aspire

Hilton Honors American Express Aspire Card Compare	Annual Fee: $450 Purchase APR: 17.99% – 26.99%, Variable
Required credit: Excellent Bonus offer: 150,000 Hilton Honors points after you spend $4,000+ in purchases within your first 3 months Purchase intro APR: N/A Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 14 Hilton Honors points per dollar spent on all Hilton-related purchases 7 points per dollar spent on flights booked directly with airlines or amextravel.com, car rentals booked directly from select car rental companies, and US restaurants 3 points per dollar spent on all other purchases Notable Perks & Benefits:Â Unlimited Priority Pass lounge access for you and up to 2 companions per visit Annual $250 Hilton Resort statement credit Annual $250 airline fee credit with a qualifying airline of your choosing Complimentary Diamond status in Hilton’s loyalty program More card details (click to expand) Hide

Hilton-heads out there will appreciate the Hilton Honors American Express Aspire card. Yes, you’ll get Priority Pass Select membership granting you and up to 2 companions free access to Priority Pass lounges. You’ll also get a nice set of Hilton-specific benefits, including:

Hilton Honors Diamond status
Two weekend award nights — one when you open your account (and on your account anniversary) and one when you spend $60,000 in a calendar year
$250 Hilton Resort statement credit — you get one each calendar year
$250 airline fee credit for incidentals with an airline of your choosing

As far as points go, you’ll get 150,000 Hilton Honors points when you spend $4,000+ on purchases in the first 3 months. The Aspire card also offers a whopping 14X points on all Hilton-related purchases along with 7X points on flights booked directly with airlines or amextravel.com, car rentals booked directly from select car rental companies, and US restaurant purchases. All other purchases will earn you 3X points.

The Hilton Honors Amex Aspire card carries a $450 annual fee.

Hilton Honors American Express Ascend

Hilton Honors American Express Ascend Card Compare	Annual Fee: $95 Purchase APR: 17.99% – 26.99%, Variable
Required credit: Good, Excellent Bonus offer: 125,000 Hilton Honors points after you spend $2,000+ on purchases in the first 3 months Purchase intro APR: N/A Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 12 Hilton Honors points per dollar spent on all Hilton-related purchases 6 points per dollar spent on all purchases at US restaurants, supermarkets, and gas stations 3 points per dollar spent on all other purchases Notable Perks & Benefits:Â 10 free visits per year to Priority Pass lounges, with each subsequent visit costing $27 Your guests can enter Priority Pass lounges for $27 apiece Complimentary Gold status in Hilton’s loyalty program Earn a Weekend Night Reward after you spend $15,000 on purchases in a calendar year More card details (click to expand) Hide

No, we didn’t screw up and list the same card twice. The Hilton Honors American Express Ascend (not the Aspire) card differs from its sister card — and every other credit card listed in this article — in that it offers airport lounge access while sporting an annual fee of just $95. Relatively speaking, the Ascend card is the “bargain” option if you want a credit card that grants you airport lounge access!

However, along with the smaller annual fee comes a lower level of lounge benefits. You get 10 free visits per year to Priority Pass lounges, with each subsequent visit costing $27. And if you want your guests to get in for free, you’ll have to use up one of your 10 free lounge visits on each person you bring with you.

The card comes with a bonus offer of 125,000 Hilton Honors points after you spend $2,000+ on purchases in your first 3 months. You’ll also earn 12X points on all Hilton purchases, 6X points on US restaurants, supermarkets, and gas stations, and 3X points on everything else. Additional benefits include complimentary Hilton Honors Gold status and a free weekend reward night after you spend $15,000 on purchases in a calendar year.

Final Thoughts

Airports are not fun places. If you’re prepared to pay for the privilege of having a more pleasant airport experience, a travel credit card gives you a better deal on airport lounge access than a standalone membership. If you travel often enough to take advantage of the benefits of these cards, you can easily recoup the value of these cards’ high annual fees.

Still searching for the credit card that fits your needs? Let these articles inform your decision!

Best airline credit cards for businesses
Top credit cards with no foreign transaction fees
Guide to using personal cards for business

The post Top Credit Cards With Airport Lounge Access appeared first on Merchant Maverick.

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July 9, 2019

Cloudways Hosting Review: Pros, Cons, and Alternatives

So you’re looking into using Cloudways as your hosting provider, and you’re wondering how they stack up against the competition.

But hold on one second.

I tested out Cloudways for a client project because they have gotten really good press for creating a truly unique product in a pretty staid industry.

As with any unique product, they’ll need a bit of background on the web hosting spectrum.

Let’s talk about the difference between cloud hosting and traditional shared hosting.

Usually your website files live on a part of a server that you rent from a hosting company (hence “shared” hosting). A cloud is an entire network of data centers that host website files in a distributed & decentralized fashion. Your files are deployed “everywhere” in a way of speaking. You just rent the resources on the network needed to host & deliver your files.

Imagine real-world housing for a second. Traditional hosting is like buying a house, townhouse or condominium. You buy it and you can do whatever you want. It’s cheap and predictable. But if your entire extended family shows up one day – you might have some issues hosting everyone. Cloud hosting is like having access to any house anywhere in the world whenever and wherever – you just have to pay per night for whatever house you use. It’s more expensive day to day, but when your entire extended family shows up one day – it’s a pretty simple, quick fix. You just get the 12 bedroom house for the night and no one is the wiser.

The actual cloud is built by the biggest tech companies in the world. There are not that many. Amazon is the biggest. They are closely followed by Google, Microsoft, Oracle, and IBM along with a few smaller ones like Digital Ocean.

With cloud hosting, you have more access to guaranteed resources than on shared hosting.

On shared hosting, you have a set amount of resources on a specific server that also has a set amount of resources. For example, you might have 1GB of Memory dedicated to you on a server that has 10GB of memory in total.

But suppose there are 10 customers on that shared server, each with 1GB of memory. 9 of those customers start using a full 1GB of their allocation – sometimes a little bit over. Well, now, you can’t actually use your 1GB of memory without bringing the server done. In that case, you might get throttled or one customer’s site might get taken down. Now, a good shared hosting will have network engineers who have built out ways of balancing, but it’s the core tradeoff with the setup.

On cloud hosting, you pay per use of resources on a distributed network of servers that has basically infinite resources. Your data doesn’t live on a single server. Instead, it’s copied on a whole network all around the world. If a single server gets overloaded, another server starts returning the the data.

This is the reason why NetFlix runs on Amazon’s cloud and why Twitter runs on Google’s Cloud. Those are extreme but illustrative examples. They see huge spikes at random times during the day that only a cloud can handle.

This makes cloud hosting a great option for websites that have spiky traffic (like viral news sites or a site that goes through regular launches) and doesn’t want to commit to a set amount of resources that may or may not be guaranteed.

But cloud hosting is traditionally expensive and very technical to set up, which can make it not make sense for a lot of DIYers and small businesses. The time & money to get it configured *just* right is out of reach for most businesses.

And that’s where Cloudways comes in.

What is Cloudways?

Cloudways is what’s known as a “managed cloud hosting company” headquartered in Malta. They offer hosting via the big cloud companies, but they manage the process by providing custom setup software, support, and some price smoothing to make cloud hosting more accessible to small businesses and DIYers.

See Cloudways Current Plans & Pricing.

Cloudways competes directly with other hosting companies with managed cloud-based products, like HostGator Cloud, WP Engine, and SiteGround Cloud.

However, they also compete indirectly with the cloud companies themselves like Google, Amazon, Microsoft, Digital Ocean, and Linode since anyone can buy directly from them.

But Cloudways also compete with traditional shared hosting companies like Bluehost, SiteGround, Hostwinds, Hostinger, Dreamhost, InMotion, etc. because of their pricing model & price point.

Confused yet? Yeah – me too, and I’m the one trying to write this review and explain it to my clients.

In some ways, this point is a pro for Cloudways. They are trying to do something truly unique in the hosting industry. Anything truly novel is hard to figure out. That doesn’t come along often, and it’s worth pointing that out.

Essentially Cloudways provides the guaranteed resources of cloud hosting with the guaranteed pricing of shared hosting. For a lot of businesses, this deal does not make sense — but if you know you’ll have really high highs and really low lows in your website traffic and don’t want to commit to (or deal with the technicalities of) direct cloud hosting with Google, Amazon, etc., it’s a fairly interesting set-up.

So with that said, let’s look at the Pros and Cons of Cloudways hosting.

Pros of Cloudways

There are a lot of Cloudways reviews online – usually with user-generated reviews based on anecdotes and personal experience. That’s fine but I take a different approach. As I’ve said in other hosting reviews, there is no such thing as a “best” web host. The “best” is the right fit for your project based on your goals, budget, experience & expertise. Here are the pros (advantages) for considering Cloudways.

Simplified Pricing

One of the biggest advantages of using Cloudways as your cloud hosting provider is their simplified pricing packages. Traditionally, cloud hosting pricing is pretty complex. Because you pay for what you use, it can be difficult to figure out exactly what you’re going to end up owing. Just look at Google Cloud’s pricing calculator:

Cloudways has simple, monthly pay-as-you-go plans. There’s no calculating, no guessing — just straightforward monthly rates that you can choose based on your needs.

They also have a chat bot that will recommend a specific plan for you based on the number of websites you have, your traffic volume, and the purpose of your site (i.e. blog, digital agency, etc.).

All in all, the pricing structure is straightforward and pretty hassle-free, which is a huge competitive advantage when comparing Cloudways to other cloud hosting providers.

Cloud Host Variety

Another interesting advantage of Cloudways is the ability to choose your Cloud Host. Cloudways offers hosting with several big cloud hosts, from DigitalOcean to Amazon to Google.

Again, this makes Cloudways the middle man of sorts. You’re not actually hosting on their platform — they serve as the intermediary between you and the cloud hosting platforms.

Having the choice of cloud hosts in a more simplified pricing structure is definitely a pro… but again, it really only makes sense if you know you’ll have highs and lows in your website traffic and don’t want to commit to (or deal with the technicalities of) direct cloud hosting with Google, Amazon, etc.

Performance

In addition to hosting your website files, a good hosting server will also deliver those files as quickly as possible every time a visitor goes to your domain name address.

There are a lot of variables that go into how fast your website is. You can have the fastest server in the world and still have an incredibly slow website due to issues on your end. But either way, you want to have a hosting server that is fast so that you can work on your side of the equation.

One of the best measurements for approximating performance is TTFB or Time to First Byte. Again, I know that network engineers throw a lot of asterisks here and if you know *exactly* what type of website you are running – you can absolutely ask for detailed allocated specs. My goal with my hosting reviews is to provide a narrative of tradeoffs so that you can make the call for your website.

But here’s how DigitalOcean performed via Cloudways with my website when I first set it up on a clean WordPress install –

.0127s for TTFB is pretty speedy, especially when you compare it to the performance of budget shared hosts like Web Hosting Hub, Hostinger, iPage, or even GoDaddy. Actually, it’s really fast no matter who you compare it to.

Again, there are tradeoffs here. The more your use on Cloudways, the more you’re going to pay. But if you’re looking for a hosting platform that can handle spikes of traffic without throttling your performance, Cloudways gives you some great options.

Cons of Cloudways

Like any web host, Cloudways has disadvantages. There are plenty of Cloudways complaints to be found online. Plenty are valid, and some are simply anecdotal. Here are the cons that I found while using Cloudways for hosting.

Complex Set Up

Perhaps the biggest con of Cloudways is how complex it can be to get up and running.

As much as Cloudways positions themselves as the ones who take care of the complexities of cloud hosting, making it easy for business owners to get set up and focus on their actual business… the set up of hosting with Cloudways is far more complex than traditional hosting.

For starters, aside from a video on how to migrate your WordPress website and some articles, there isn’t much in the way of onboarding (AKA guiding you through getting set up on their platform). We did get a few emails from customer support, but if you wanted to dive in and get started yourself, it’s a bit like navigating a maze.

We also had some trouble getting our account up and running. The sign up process isn’t as simple as entering your information and diving in. Cloudways has to confirm your details, and it took a few different conversations with support to get access to our account.

Lastly, after the three day trial (more on that in a minute), we had to remigrate our account. Now – this could have been user error, but it was so complicated – even for someone who has written a ton of reviews of hosting companies. I couldn’t even tell if it had worked the first time.

Limited Trial Period

Despite their simplified pricing structure, Cloudways does have one main con in the pricing area… and that’s their limited trial period.

Usually hosting platforms will come with some sort of guarantee or trial period, so you can test them out before you commit. Cloudways offers three days — and if you’re having difficulty figuring out the migration and set up, those three days go pretty fast.

Again, if you’re committed to cloud hosting, this probably doesn’t matter to you. But if you’re testing it out, it’s a short period.

Custom Backend

At most hosting companies, you have an account area where you access to billing, account information, bonuses (ie, Google Ads credits), etc – it will also have links to your actual server backend/dashboard.

Most hosting companies use cPanel as the server backend/dashboard. cPanel is where you go to do anything with your hosting server – install any applications (ie, WordPress), set up email addresses, get your FTP information to upload files, etc. It’s simple, straightforward, and since most hosting companies use it, it’s sort of an industry standard that you can get help with anywhere online.

Cloudways does not use that setup. They use a proprietary backend for both your account administration and your server administration. It’s seamless for what they do…but it’s not really something you can Google or DIY troubleshoot.

On one hand, it is simplified and allows Cloudways to provide a truly customized experience. On the other hand, the set up is confusing and feels limiting. It’s difficult to sort through where things are, and everything feels overly technical (which really doesn’t help me “focus” on what I do best, AKA run my business).

It adds to the complexity of the platform, rather than making it more streamlined and simple.

Conclusion & Next Steps

Overall, I found Cloudways to be a unique solution for those who need the benefits of cloud hosting without the complete complexity of it. While Cloudways still isn’t as straightforward as traditional hosting companies, it does streamline the process of getting set up with a cloud host.

See Cloudways Current Plans & Pricing.

If you’re looking for the benefits of cloud hosting, but don’t want to deal with the overly technical set up, fluctuating payments, etc., go ahead and sign up for Cloudways here.

However, if you just need a solid hosting company that’s straight forward, easy to use, and can handle steady website traffic, you’re better of with a traditional hosting platform like InMotion Hosting. I’ve used them for years – and they fit most small business sites’ need for a balance between price, performance & support.

If you are more confused than ever – then take my Web Hosting Quiz here or use my website setup guide here!

The post Cloudways Hosting Review: Pros, Cons, and Alternatives appeared first on ShivarWeb.

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July 8, 2019

Credit Card Consolidation: How to Consolidate Credit Card Debt

We are a nation of debtors.

The defining feature of modern American life is the fact that everything necessary for survival — housing, education, health care, you name it — gets more expensive by the day while our wages stagnate or decline. Ergo, we get ourselves into credit card debt in order to keep the late capitalist wolves at bay. You may well be dealing with paying down multiple high-interest credit cards along with keeping all your other bills paid.

If this is the case, there are ways you can make your payments easier to handle by consolidating your credit card debts into a single debt with a lower interest rate. As it happens, there are multiple methods of doing this, each with its own advantages and disadvantages.

Credit Card Consolidation: The Basics

Credit card debt consolidation is easy enough to describe. You borrow money to pay off your existing credit card debt, which results in you having a single debt to pay off rather than several. This single debt will typically have a lower interest rate than your original debts. This way, you’ll save money and make the repayment process more manageable.

Sounds great, right? Well, there are different ways to consolidate your credit card debt, and each method comes with its own upsides and downsides. We’ll get into these methods, but first, let’s discuss just who should be looking into credit card debt consolidation.

Who Should Consolidate Credit Card Debt?

When done right, consolidating your credit card debt should leave you in a better financial position than when you started and should make it easier for you to pay down your debt. But if you’re not in a position to be able to stop making new credit card charges, you won’t be any closer to your goal of paying off your debt. Likewise, a decent credit score is an unfortunate prerequisite for certain debt consolidation methods (like a personal loan).

While anybody buried under credit card debt can take advantage of one debt consolidation method or another, it’s important that the method matches your individual circumstances.

Common Debt Consolidation Pitfalls

Every debt consolidation method carries particular risks. For instance, consider the situation I outlined above. If you take out a personal loan to pay off your credit cards but then continue to rack up charges on your credit cards, you’ll have only added another debt to your debt pile with your personal loan.

Likewise, a homeowner may take out a home equity loan or line of credit and use the money to pay off credit card debts. But if — for whatever reason — you can’t make your HELOC payments, you could lose your home!

While there are a number of ways you can try to hoist yourself out of credit card debt, always be aware of the hazards associated with each method.

5 Ways To Consolidate Credit Card Debt

There are a number of tactics one can employ to tackle credit card debt, five of which I will detail here:

Transfer your debt to a 0% balance transfer credit card
Take out a personal loan
Find a nonprofit credit counseling organization
Take money out of a retirement account
Take out a home equity loan or line of credit

Transfer Your Debt To A 0% Balance Transfer Credit Card

Certain credit cards are sold as debt consolidation tools. These cards will usually offer an introductory interest-free period (often 12-15 months but occasionally longer) on all credit card balances you transfer over to the card within a certain time frame (typically within 30-60 days of getting your card). If you manage to pay off your debt on the card within the interest-free period, you can avoid paying any further interest on your debt.

It’s one of the safer means by which you can consolidate your credit card debt, as you won’t be putting your house on the line or anything. However, these balance transfer credit cards often require good to excellent credit in order to qualify, thus excluding a lot of indebted people. What’s more, while these cards won’t charge interest on your balance transfers for a certain length of time, these cards often have a balance transfer fee of about 3%.

Additionally, the credit limit on your balance transfer credit card may not be high enough to accommodate you transferring all your existing credit card debt to the balance transfer card. If you have an enormous amount of credit card debt, it won’t be easy to find a balance transfer credit card that can accommodate all of it.

Another factor to consider: Some credit card issuers won’t let you transfer a balance to their card from another card of theirs. For instance, Chase won’t let you transfer a balance from one of their cards to another.

A good example of a balance transfer credit card is the Amex EveryDay card.

Amex EveryDay Credit Card Compare	Annual Fee: $0 Purchase APR: 15.24% â 26.24%, Variable
Suggested credit:Â Good, excellent Bonus offer:Â 10,000 Membership Rewards Points after you spend $1,000 in the first 3 months Purchase intro APR:Â 0% for the first 15 months Balance transfer intro APR:Â 0% for the first 15 monthsÂ on all balances transferred within 60 days of account opening Foreign transaction fee: 2.7% Rewards: 2 points per dollar spent at US supermarkets, up to $6,000 per year 2 points per dollar spent on eligible travel purchases booked through amextravel.com 1 point per dollar on all other purchases Notable Perks & Benefits:Â Earn 20% extra points on your purchases if you make 20 or more purchases in a billing period Car rental loss and damage insurance More card details (click to expand) Hide

The card’s 0% APR on balance transfers lasts for 15 months and applies to all balances transferred over to the card within 60 days of getting your card. What’s more, all balances transferred over within the first 60 days will not have a balance transfer fee applied.

The 15-month 0% APR applies to purchases as well as balance transfers. In addition, you can earn rewards points for your spending. Many balance transfer credit cards lack a rewards program.

Want to check out some other credit card options for debt consolidation? Check out our article on the best credit cards for balance transfers.

Take Out A Personal Loan

Personal loans can be obtained from a bank, credit union, or online lender and can be used to pay off your credit card debts. Your interest rate will typically depend on your credit.

Is a personal loan the right debt consolidation method for you? Unfortunately, it depends on your credit. Well-qualified applicants should be able to obtain a loan with a low interest rate that will save the borrower money on interest payments, while those with poor credit may have trouble obtaining a loan with an interest rate that won’t be so high as to negate the debt-consolidation benefits of the loan. If this is you, you may want to check with a credit union before you go to other types of lenders, as credit unions tend to be more likely to accommodate borrowers with low credit scores than other types of lenders.

Furthermore, some online lenders offer loans tailored specifically for debt consolidation. Payoff is one such lender.

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Time in business: N/A Personal credit score: 640 or higher Business revenue: N/A Borrower requirements (click to expand) Hide

Payoff offers fixed-rate personal loans of up to $35,000 for debt consolidation to borrowers with a credit score of at least 640. The “fixed-rate” part is important as it means your monthly payments will always be the same amount, which should help with your budget planning.

Well-qualified applicants can get a loan with an interest rate less than that of most balance transfer credit cards — and you can check your potential interest rate on Payoff’s website without affecting your credit. Payoff will also send you a free monthly update of your FICO score.

Find A Nonprofit Credit Counseling Organization

If you’d like some personal attention to your specific debt situation, seek out a credit counseling organization. These organizations work with debtors on a one-on-one basis, offering advice and assistance in creating plans to help you climb out of debt. I would suggest looking for a nonprofit credit counseling organization accredited by the National Foundation for Credit Counseling (NFCC).

These organizations can help you set up a debt management program in which you make payments to the counseling agency in question. The agency then makes payments on each of your debts. They may even be able to negotiate lower interest rates or monthly payments for you.

The downsides to this debt consolidation approach are comparatively minor. You’ll probably have to pay a monthly service fee and a setup fee, and you may be required to close your credit cards after paying them off.

Take Money Out Of A Retirement Account

If you find that better debt consolidation options aren’t available to you, you can try borrowing from your employer-sponsored retirement account (such as a 401(k) or an IRA).

This isn’t a debt consolidation method of first resort, as the downsides are serious: you’ll have less money in your retirement account, you might have to pay income taxes and an early withdrawal penalty, and if you’re borrowing from your 401(k), you’ll have to repay the loan within 5 years (and if you lose your job, you’ll have to repay the loan within 60 days!). The consequences are worse if you can’t repay your loan. You’ll get hit with a big penalty as well as taxes on the unpaid balance, and you’ll be in more debt than ever.

Unless your circumstances are truly desperate, I wouldn’t recommend this method of consolidating your credit card debt!

Take Out A Home Equity Loan Or Line Of Credit

Here’s another high-risk debt consolidation method: You can borrow against the equity in your home (or possibly your vehicle) with a loan or line of credit. The repayment period can vary from 5 to 20 years but is commonly 10 years.

On the plus side, as this loan would be secured, you’ll get a lower interest rate than you’ll get with an unsecured loan, and you won’t need good credit. On the downside: if you can’t make your payments, you could lose your dang home!

Due to the manifest risk, this is another debt consolidation method of last resort. You don’t want to put your house at risk unless you’re supremely confident in your ability to repay the loan. And even then, you could still end up being wrong!

Next Steps: What You Should Do After Consolidating

Once you’ve consolidated your credit card debt, be sure to monitor your credit score regularly. Thankfully, there are ways to do this for free and without hurting your credit score.

Of course, along with monitoring your credit score, you’ll want to try to improve it! One way to do this is to simply make timely payments on all your debts (including credit card payments, obviously). Whenever you can, set up automatic payments.

For more on how to use your credit cards in a way that will improve, rather than hurt, your credit score, check out our article on how to build credit with a credit card.

One piece of advice typically given in this situation is to just cut back on your spending. However, given the skyrocketing cost of merely existing in this predatory world (much less raising kids, etc), this advice can be unrealistic and smacks of privileged condescension. Nevertheless, if you do spend a significant amount of your income on non-essential purchases, you might want to re-evaluate your spending habits!

Final Thoughts

The right debt consolidation strategy is invaluable when you’re trying to claw your way out from under credit card debt. The key is to find the strategy that best fits your particular circumstances. Merchant Maverick is here to help you in your quest!

For more on healthy credit card use and getting out of debt, check out the following articles:

Guide to credit card balance transfers
Top no fee balance transfer cards
How to cancel a credit card
Best free credit score sites
How to build credit with a card

The post Credit Card Consolidation: How to Consolidate Credit Card Debt appeared first on Merchant Maverick.

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April 19, 2019

How To Start A Pet Sitting Business: The Complete Guide

Have you always had an affinity for furry (or scaly) things? Have you ever needed money? If you answered yes to both these questions, you may want to consider starting a pet-sitting business.

But before you pick up the leashes and pooper-scoopers, it’s a good idea to sit down and plan out the trajectory of your business. If that sounds overwhelming, don’t fret. Below, we’ll lay out the steps you can take to start a pet-sitting business.

Decide On A Location

Since you’re going to be dealing with people’s pets, you’ll need to take into account your proximity to your clients. If they’re dropping their pets off with you, you’ll want to be located somewhere easily accessible to most of your customers, and one that can accommodate animals. Depending on where you live, this can be tricky as the space necessary to accommodate animals will usually be cheaper in less centralized locations.

On the other hand, if you’re going to your customers, you’ll need to take into account the amount of time you need to spend with each client’s pets, the costs of commuting to the job, and how animal-friendly/animal-hostile the infrastructure in your service area is (dog parks, etc.).

Register Your Business

Why should you register your business? Depending on your local laws, you may actually be required to register your business in order to legally pet-sit. But even in jurisdictions where it isn’t compulsory, there are some advantages to doing so.

The first is that you can do business under a name other than your own. So instead of Martha Swearingen, LLC, you can do business as Baron Bark’s Pet Pampering Service (you can have that one for free).

The default configuration for businesses is aÂ sole proprietorship (or a partnership, if you’re starting it with someone else). This essentially means that you’ve started a business with your own name or, if you file a DBA (Doing Business As), a name of your choice.

Sole proprietorships have the advantage of being cheap and easy to start. Your taxes will also be easier to file (and lower) than they would generally be with other forms of incorporation. Keep in mind, however, that for liability purposes, sole proprietorships and the individuals behind them are essentially one and the same.

Other forms of incorporation will require a bit more work and come with their own advantages and disadvantages.Â Most pet-sitting companies aren’t going to be interested in forming C-suites for governance, so you can probably ignore S-Corps and C-Corps for now. You may, however, want to consider forming an LLC to provide some separation between your personal finances and liabilities and your business ones.

Here are the most popular ways to incorporate:

Limited Liability Corporations (LLCs):Â If you’ve seen LLC after a corporation’s name, you’re dealing with this type of company. LLCs offer limited liability protection for their owners without the full complexity of a corporation. Each state has its own rules for how to start and maintain an LLC, and you don’t necessarily have to register your LLC in the state where you’re doing business (although you’ll generally want to). LLC owners report theirÂ business earnings and losses on their personal taxes.
C-Corp:Â This is the “basic,” default form of incorporation. Shareholders are considered the owner(s) of the company and receive limited liability protection; however, the business decisions are made by corporate officers who may or may not be shareholders. The corporation is taxed separately and shareholders pay income tax on dividends. To form a C-corp, you’ll file articles of incorporation with your state.
S-Corp:Â S-corps are similar to C-corps in most ways, but come with a few additional restrictions: you have to have fewer than 100 shareholders and they have to all be U.S. citizens or residents. Unlike C-corps, profits and losses are reported on personal taxes, not unlike an LLC. In addition to filing articles of incorporation, you’ll also need to file IRS Form 2553.

Get Business Insurance

As a pet-sitter, you’re not just dealing with property, you’re dealing with animals whose owners often view them as part of their family. In other words, if something goes wrong, things could get ugly.

Depending on your local laws, you may be required to carry certain types of insurance.

The type of insurance that will probably be of most interest to you is general liability insurance. This protects you in the event of a lawsuit or accident, whether it’s an accidental injury to the animal or if you accidentally damage property within a client’s home. It doesn’t only protect you, however; it also makes you look like a safer option than a business that isn’t covered.

There are other, more specialized types of insuranceÂ that are worth taking a look at depending on the specifics of your business. These include:

Property Insurance: Protects the property needed to run your business (as opposed to damages you cause to clients’ property).
Business Interruption: Covers costs related to unforeseen events that make your business unable to function.
Professional Liability (Error and Omissions): Covers the costs of defending your company in lawsuits in cases where your business caused a financial loss.

If you aren’t sure where to look, we can help you.

Invest In Business Software

While not absolutely necessary, you can save yourself and your customers some hassle with strategically chosen business software. For pet sitting, there are probably three types most worthy of consideration.

Payment Processing

Doing business with cash can be convenient when you’re first starting out, but as you grow, you’ll probably be missing out on clients if you can’t accommodate other forms of payment.

Recommended Option: Square

Best Overall Mobile POS	Review Visit Site

Highlights No contract or monthly fee Instant account setup Retail upgrade available Restaurant upgrade available For iOS and Android mobile devices 2.75% per in-person card swipe	Retail POS:Â Free trial ($60/mo value) Â Restaurant POS: Free trial ($60/mo value) Â Square POS: Always free

If you have an iOS or Android device, Square offers an extremely convenient way to accept mobile payments while on the go via a small add-on you plug into your device. It’s also a very scalable service; if you’re running a retail location, there are even more features and service options you can take advantage of.

Best of all, there aren’t any monthly fees to worry about. Square charges between 2.75Â – 3.5 percent per transaction (depending on whether you swipe or key in the info), so you’ll want to factor those costs into your expenses.

Scheduling Software

As you add clients, it will get harder to remember their particular preferences, not to mention more difficult to fit them all into your schedule. With booking or scheduling software, you can track your time, note customer needs, and efficiently plan your days’ work. Many of these offer their basic features free of charge.

Accounting Software

Most businesses can benefit from accounting software. What you don’t want is to spend money unnecessarily on one. Wave offers most of the features you need at no cost.

With no monthly fee, you’ll get invoicing, estimates, contact management, expense tracking, accounts payable, and inventory tracking.

Seek Funding

Pet-sitting, especially, if you’re going to your clients, doesn’t have a lot of overhead when you’re first starting out. In the event that you do need to scare up some money to cover starting expenses or equipment, there are a number of options available to you.

Personal Savings

If you can avoid taking on debt, it’s usually a good idea. It may hurt to part with some of your rainy day funds, but you won’t be accumulating expensive interest and fees.

Tap Your Support Network

If you do need money from an outside source, you can often get a better deal from your support system than you can from a private lender.

Keep in mind that this comes with its own risks. You may stress your relationships, especially if you aren’t able to pay back these so-called friendly loans quickly. One way to avoid this is to formalize any agreements you make with friends and family so that everyone fully understands what they’re getting into and what the expectations are. You may even want to draw up a formal contract that outlines any expected payments and return on investment.

Credit Cards

For the relatively low expenses you will encounter when you start a pet-sitting business, credit cards can probably suffice for most of your needs.

The general rules of thumb when it comes to using credit cards effectively are these:

Use credit cards for expenses that you can pay off within their interest-free grace period.
Pick a card with a reward program that matches your spending habits and needs.
Do not take out cash advances on your credit card.

If you follow these rules, you can actually save money by using your credit card to make purchases.

Recommended Option: American Express SimplyCash Plus

SimplyCash Plus Business Credit Card from American Express Compare	Annual Fee: $0 Purchase APR: 14.49% – 21.49%, Variable
Required credit: Good, excellent Bonus offer: None Purchase intro APR: 0% for the first 9 months Balance transfer intro APR: N/A Foreign transaction fee: 2.7% Rewards: 5% cash back at U.S. office supply stores and on wireless telephone purchases, up to $50,000 per year 3% cash back on a category of your choosing (airfare, hotel rooms, car rentals, gas stations, restaurants, advertising purchases, shipping, or computer hardware, software, and cloud computing), up to $50,000 per year 1% cash back on all other purchases Notable perks & benefits: Expanded buying powerÂ â buy above your credit limit with no penalty fees Employee cards available Extended warranty & purchase protection Car rental loss & damage insurance More card details (click to expand) Hide

Amex’s SimplyCash Plus offers one of the best cash back programs available without an annual fee. You’ll get 1 percent back on generic purchases, 5 percent back on wireless telephone purchases and office supply stores in the U.S. But it’s the middle tier that’s most interesting. You can select a category of your choosing (airfare, hotel rooms, car rentals, gas stations, restaurants, advertising, shipping, or computer hardware) to get 3 percent back.

It also carries an introductory 0% APR for the first nine months, which can be helpful if you’re just starting out.

Recommended Option: Amazon Business Prime American Express Card

Amazon Business Prime American Express Card Compare	Annual Fee: $0 Purchase APR: 16.24% â 24.24%, Variable
Required credit: Good, excellent Bonus offer:Â $125 Amazon.com gift card upon approval (if you have an eligible Amazon Prime membership) Purchase intro APR:Â N/A Balance transfer intro APR: N/A Foreign transaction fee:Â None Rewards: If you have an eligible Amazon Prime membership:Â 5% back or an extra 90 days interest free on purchases at Amazon Business, AWS, Amazon.com and Whole Foods Market If you do not have an eligible Amazon Prime membership: 3% back or an extra 60 days interest free on purchases at Amazon Business, AWS, Amazon.com and Whole Foods Market 2% back on purchases at U.S. restaurants, U.S. gas stations, and on wireless telephone services purchased directly from U.S. service providers 1% back on other purchases Notable perks & benefits: Employee cards available Employee purchase control withÂ multi-user accounts, shared payment methods, approval workflows, and spending limits Purchase protection, extended warranty, and travel coverage Access to Amex Offers More card details (click to expand) Hide

This one’s a little more niche. But if you find yourself buying supplies and random pet-related doodads on Amazon frequently, you can get a lot of value out of the Amazon Business Prime American Express Card.

If you have a Prime membership, you’ll earn a whopping 5 percent back on purchases made at Amazon.com, Amazon Business, AWS, and Whole Foods Market — or an extra 90 days interest-free grace period for purchases made at those places. Even if you’re not a Prime member, you’ll get 3 percent or 60 days, respectively. You’ll need to spend around $6,000 to recoup the cost of a $119 Prime membership with points alone, but that’s without factoring in money saved through Prime’s programs (shipping, deals, etc).

Personal Loans

If you need more money than you can safely put on a credit card, or need longer to pay it off, you should consider getting a personal loan that can cover business expenses.

There are some disadvantages to taking this route, namely that you’re on the hook rather than your business, but if your credit is good, it’s not the worst option out there.

Recommended Option: Lending Club Personal Loans

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Time in business: N/A Business revenue: N/A Personal credit score: 600 Credit history: 3 years Borrower requirements for personal loans (click to expand) Hide

Lending Club is a good option for individuals who may not have the strongest credit, but have a good debt-to-income ratio. The borrowing range is fairly narrow at $1k to $40k, but when you’re just starting out, you don’t want to go too deeply into debt anyway. You’ll have three-to-five years to pay it off, which makes it fairly manageable.

Recommended Option: Lendio

	Review Visit Site

Time in business: 6 months Business revenue: $10,000 per month Personal credit score: 550 Borrower requirements (click to expand) Hide

If you’re just entering the alternative loan market for the first time, it can be pretty overwhelming. Lendio takes some of that burden off of you by allowing you to effectively apply to their whole network of lenders with one application.

Need more options? Check out our feature on startup loans.

Create Contracts

If you’ve just been watching your friends’ pets, you’ve probably had an informal agreement about the services you’d provide and the expectations of safety and liability involved. And that was probably enough.

When you’re dealing with strangers in a professional capacity, however, it’s smart to formalize these elements in a contract. This can save you a lot of headaches, if not legal troubles, down the road. You’ll want to include critical information about the pet (when and what they eat, how they are with strangers, pertinent medical history, etc.), what’s included in your services, and the client’s expectations for how their home will be treated under your care (if applicable). You’ll also want to include your fees and rates.

If you can, have a lawyer look it over to make sure it checks out legally.

Market Your Business

Getting the word out is always one of the most challenging parts of getting a business off the ground. The easiest place to start is through word of mouth. Are you already looking after the pets of a family or two? Let them know you’re looking to take on more clients, along with your friends, family, and social contacts.

At some point, you’ll probably want to expand outside the reach of your current contacts, which means advertising. It doesn’t have to be fancy. You can post flyers on bulletin boards and leave business cards in places trafficked by pet owners. Online classified sites like Craigslist can also cover a large audience in your area.

Bolster Your Web Presence

When it comes to promoting small business, the internet is one of those things that’s easy to both over- and underestimate. On the one hand, simply buying an ad and hoping for the best likely won’t yield amazing results. On the other, you do need an internet strategy to grow your business.

It doesn’t have to be fancy, but you’ll probably want a website that details your basic services and contact information. Don’t overthink it. There are a lot of great tools available that can help youÂ build a website.

Remember, too, that social media isn’t just for sharing pictures of your dinner with your friends. You can use to communicate with customers, make engaging content that makes them keep your brand in mind, and announce special deals and service changes.

Final Thoughts

Hopefully, everything we covered doesn’t look too intimidating. If you’re good with animals and don’t mind turning that love into a source of revenue, you can get a pet-sitting business up and running in no time!

Having second thoughts about pet-sitting but are still looking to open a business? Check out our other beginners’ guides.

The post How To Start A Pet Sitting Business: The Complete Guide appeared first on Merchant Maverick.

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April 9, 2019

How To Start And Fund A Consulting Business: The Step-By-Step Guide

Do you have a tendency to share your knowledge and experience with others? Do you enjoy giving advice that helps others better their businesses â¦ or their lives? Did you know that you could get paid just for sharing your expertise?

While it may sound too good to be true, thatâs exactly what a consultant does. A consultant is an expert that provides knowledge, expertise, and training to others for a fee. Consultants advise their clients on a variety of topics, from how to implement the latest technology to how toÂ create a successful marketing campaign.

Becoming a consultant does not require special training, credentials, or education. You simply need to be an expert in your field. You also need to have passion — not just for your industry but for helping others truly find the right solutions for their problems.

Consultants are organized, know how to network, and are always willing to learn more about their field to provide the best services to their clients.

If this sounds like you, becoming a consultant may be your new career path. The great thing about consulting is that anyone with knowledge and expertise can do it. Starting your own consulting business has low overhead costs and doesnât require a lot of capital from the get-go. In fact, you can even start your own business from your home office.

But maybe your goals are much bigger. Maybe you want to have the top consulting firm in your area. It doesnât matter if you want to simply be your own boss and make a decent income or if you want to grow your business to epic proportions — this guide is for you.

Weâll explore the steps you need to take to get your business off the ground. From finding your niche to funding expenses and spreading the word about your business, this guide explores what it takes to open and operate a successful consulting business. Letâs jump in and get started!

Pick Your Niche

Weâve all heard the saying, âJack of all trades, master of none.â When clients are seeking a consultant, they donât want someone that knows a little bit about everything. Instead, they want to work with a consultant that knows everything about one thing. This is why itâs so important to pick your niche.

To get started, consider your skills and knowledge. What industry are you familiar with? Clients are looking for an expert in their field, so identifying the industries you already know is important when selecting your niche.

Next, you need to consider what problems and pain points your chosen industry is facing. You can do online research to find out what challenges are common in this industry. Check out blogs and industry forums to get an idea of common complaints and problems. You can even talk directly with people in the industry to find out what obstacles and setbacks they face.

Once armed with this information, you need to identify your own skills and knowledge that could be applied to this field. For example, letâs say youâre knowledgeable about the construction industry. One of the common pain points in this industry is a lack of communications. Are you familiar with mobile and cloud-based software? Great! You could use this knowledge to help businesses streamline communications and improve efficiency.

When you start your consulting business, your goal shouldnât just be something generic like, âI want to help other business owners.â Instead, you should have a more specific purpose in mind. âI help businesses in this industry find and implement the newest and best software solutions to grow their business in just 3 months.â This also serves as your value proposition. In other words, this is the value you offer; something that sets you apart from other consultants. Remember to effectively communicate to your clients what you can do for them.

Still unsure of where to get started? Consider one of these niches for your consulting businesses:

Biotech
Cannabis Business
College
Construction
Customer Service
Dental
Financial
Food Safety
Grant Writing
Human Resources (HR)
Information Technology
Leadership
Management
Marketing
Medical
Nutrition
Project Management
Real Estate
Safety
Sales
Security
SEO
Social Media
Supply Chain
Technology

After youâve selected your niche, do your research to find out what certifications and licenses you need to legally operate your business. In most instances, youâll find that a business license in your state of operations is all that you need to open your consulting business.

One last thing to remember is that even if youâre knowledgeable about your niche right now, industry trends and changes can occur in an instant. Make sure you stay up-to-date on whatâs happening in the industry to ensure youâre always qualified to assist your clients.

Make Your Business Plan

Even if your consulting business seems pretty straightforward, itâs still necessary to have a business plan. There are a few reasons you need a business plan. The first is that your plan maps out your goals and how you plan to reach those goals. A business plan is also necessary when you seek funding through banks or other lenders.

Because every business has a different vision, no two business plans are exactly alike. However, there are a few common components that should be included in all business plans. Those components are:

Executive Summary: Highlights what will be discussed in your plan and summarizes what your business hopes to accomplish
Company Description: Includes key information about your business and the customers that you will serve
Competitive Analysis: Who are your competitors, and what are their strengths and weaknesses?
Organization & Management: An outline of the setup of your organization and names and summaries of the job responsibilities of your management team
Market Analysis: An analysis of your industry now and in the future
Marketing Plan: An outline of the marketing strategies you will use to draw clients to your business
Financial Projections: Your expectations for future revenue based on market research

Register Your Business

Before you launch your business, you have to register with federal, state, and local agencies. You will need to register your business name with the state in which you operate. In addition, you must register with the Internal Revenue Service to get an Employer Identification Number (EIN) if you ever plan to hire employees. It’s imperative to obtain licenses and permits to operate your business based on state and local regulations. You must register your business if you plan to seek business funding now or in the future — or if want to open a business bank account. Establishing a business is legally required, but it also makes you look more professional and legitimate to your clients.

One important step to take when registering your business is choosing your business structure. Your business structure will be important in determining what youâll pay in taxes. Your business structure may also offer protection from personal liability for the debts and obligations of your business. The different types of business entities include:

Sole Proprietorships

This structure is the easiest to form and does not require filing with the state. With a sole proprietorship, profits and losses from the business are reported on the business ownerâs personal tax return. The major drawback of this business structure is that the business owner â you â are held personally liable for the debts and obligations of the business.

Partnerships

A partnership is established by businesses with two or more owners. There are three common types of partnerships: general partnerships, limited partnerships, and limited liability partnerships.

General Partnership (GP): This type of partnership has the fewest ongoing requirements. These are also the easiest to form and donât require state filing. The drawback is that partners in a GP are personally liable for the debts and obligations of the business.
Limited Partnership (LP): In a limited partnership, only the general partner(s) has unlimited liability. The other partners — known as limited partners â have limited liability. This simply means that personal assets canât be used to cover the debts and liabilities of the business.
Limited Liability Partnership (LLP): In a limited liability partnership, all partners have limited liability. However, partners may be held liable for their personal actions. This structure is reserved for professional service businesses.

Limited Liability Companies

A limited liability company, or LLC, is independent of its owners. The personal assets of the owners are kept separate from business debts. An LLC is taxed similarly to sole proprietorships and partnerships.

Corporations

If a corporation is the right structure for your business, there are two options to consider: C corporations and S corporations.

C-Corporations: C-corporations are independent of their owners. There is no limit on the number of shareholders in a C-corporation. C-corporations are taxed on shareholder dividends and corporate profits.
S-Corporations: An S-corporation is also independent of its owners. Owners report their share of the profits and losses on their own personal income tax returns. There are limitations to the number of shareholders with this structure.

When choosing your business structure, you need to keep a few considerations in mind. If you have multiple owners, a partnership is a good route to take. If you want to protect your personal assets but donât want a higher tax rate, consider establishing an LLC. If you plan to raise large amounts of capital in the future, a corporation might work best for you. You can learn more about what business structure best fits your needs by consulting with an attorney or accountant.

Get Business Insurance

Business insurance is critical for the protection of your business. From property insurance that protects your office building to liability insurance that safeguards you from lawsuits, there are a few different types of business insurance to consider for your consulting business.

General Liability Insurance

If you operate a brick-and-mortar business, you need general liability insurance. This protects your business in the event that something happens to a client on your property. For example, if a client slips and falls in your office, they could file a lawsuit against you. With general liability insurance, you wonât have to pay all associated costs out-of-pocket.

Professional Liability Insurance

Professional liability insurance is also known as errors and omissions (E&O) insurance. This type of insurance protects you from lawsuits that may be filed by clients. Letâs say that you consult with a client on a project, and the project ultimately ends up failing. The client believes that the failure of the project was your fault and files a lawsuit. If you have E&O insurance, attorneyâs fees, settlement expenses, and court costs will be covered up to the full amount of your policy.

Workerâs Compensation

If you have employees, workerâs compensation is another type of insurance your business needs. Workerâs compensation covers the medical expenses, wages, and legal fees of an employee that is injured on the job or suffers a work-related ailment. Most states require all W2 employees to be covered under workerâs compensation insurance, but laws vary by state.

Commercial Property Insurance

If you have a commercial property for your consulting business, consider getting commercial property insurance to protect your assets. This type of insurance protects you from losses that may occur from burglary, fire, or natural disasters.

Separate Personal & Business Expenses

It may be tempting to simply use your own personal bank account and credit cards for your business. Since the business is yours, thereâs no harm in mixing your business and personal finances, right?

Actually, the wisest move is to keep your business and personal finances separate. One of the most important reasons for doing this is because it will make filing your taxes much easier. Imagine that the deadline is ticking to file your return with the IRS, and you (or your accountant) are stuck spending hours separating business and personal records. If youâre audited after filing, having separate records for business and personal income/expenses will make the process go much more smoothly.

Keeping your business and personal finances separate is also helpful in limiting your liabilities from creditors. If there is no clear separation between you and the business, creditors could potentially use your personal assets for unpaid debts and obligations, even if your business is structured as a corporation or LLC.

Separation of personal and business expenses is also important for building your business credit. If youâre using your own personal credit cards, you may increase your personal credit score. However, this wonât affect your business credit history. If you plan on applying for business loans in the future, boosting your business credit profile is critical to qualifying for higher loan amounts and the best rates and terms.

The first step to separating your business and personal finances is to open a business checking account. This bank account can be used for depositing money, writing checks to vendors, making online payments, and keeping an eye on the expenses and income of your business. To open an account, you will need your EIN, Social Security Number, business address, and business license. You may also need other documentation, such as a copy of the articles of incorporation on file with your state.

Even though you can keep an eye on your finances through your business bank account, itâs also important to set up a dedicated accounting system for your business. This will allow you to closely keep track of the money coming in and going out of your business. You may opt to hire a bookkeeper for this task, or you can use accounting software to track everything yourself. Weâll go into more details on this type of software a little later.

Finally, you can apply for a business credit card to cover recurring expenses for your business, such as your lease or utility payments. Using and paying off your business credit card responsibly will help strengthen your business credit profile.

Unsure of which card is right for you? Start with these recommendations.

Chase Ink Business Cash

Chase Ink Business Cash Compare	Annual Fee: $0 Purchase APR: 15.49% – 21.49%, Variable
Required credit: Good, excellent Bonus offer: $500 cash back if you spend at least $3,000 in the first three months of opening your account Purchase intro APR: 0% for the first 12 months Balance transfer intro APR: 0% for the first 12 months Foreign transaction fee: 3% Rewards: 5% cash back on the first $25,000 spent in combined purchases at office supply stores and on internet, cable, and phone purchases each account anniversary year 2% cash back on the first $25,000 spent in combined purchases at gas stations and restaurants each account anniversary year 1% cash back on all other purchases Notable Perks & Benefits:Â Employee cards at no additional cost Travel and purchase coverage More card details (click to expand) Hide

The Chase Ink Business Cash card rewards you just for using your card on business expenses. You can receive 5% cash back on internet, cable, phone services, and purchases from office supply stores. However, this is capped at the first $25,000 spent each anniversary year.

You can also earn 2% back on purchases at gas stations and restaurants. This is also capped at the first $25,000 spent per anniversary year.

For the rest of your purchases, you can take advantage of unlimited 1% cash back rewards. As a new cardholder, you can receive a bonus of $500 cash back if you spend $3,000 within 3 months of opening your account.

This credit card has a 0% introductory APR for the first 12 months. After the introductory period, interest rates are 15.49% to 21.49% based on creditworthiness. There is no annual fee associated with this card.

Additional benefits for Chase Ink Business Cash cardholders include free employee cards, purchase protection, and extended warranty protection. You must have excellent credit to qualify for this credit card.

Spark Cash Select For Business

Spark Cash Select From Capital One Compare	Annual Fee: $0 Purchase APR: 15.24% – 23.24%, Variable
Required credit: Good, excellent Bonus offer: $200 cash back if you spend at least $3,000 in the first 3 months of opening your account Purchase intro APR: 0% for the first 9 months Balance transfer intro APR: 0% for the first 9 months Foreign transaction fee: None Rewards:Â Unlimited 1.5% cash back on all purchases Notable perks & benefits: Rewards can be requested as cash back or applied as statement credits Employee cards at no additional cost Comes with Capital One and Visa business benefits More card details (click to expand) Hide

Capital Oneâs Spark Cash Select for Business is designed for borrowers with excellent credit scores. One of the standout features of this card is the unlimited 1.5% cash back you receive just by using your card. You can cash out your rewards at any time.

If you become a new cardmember and spend $3,0000 within the first 3 months of opening your account, youâll receive a $200 cash bonus.

Youâll also be able to enjoy a 0% introductory APR for the first 9 months. After the introductory period, your APR will be from 15.24% to 23.24% based on creditworthiness. This card does not have an annual fee, and you can receive employee cards at no cost.

Seek Business Funding

One of the best things about setting up your consulting business is that you may be able to get started with very little capital. Ultimately, though, this depends on the goals of your business. For example, if you plan to only consult with clients online, you can work right out of your home office. This eliminates the need for a dedicated commercial office, which comes with expenses such as monthly rent and utility payments.

On the other hand, you might want to open a brick-and-mortar business immediately. This would require more capital from the start. Even if you start small, you may later expand your business by purchasing or leasing a larger building and hiring employees.

Whether you start off big or you plan to grow in the future, youâll need capital. In some cases, you may be able to use your revenue to fund your expenses and growth. In other instances, youâll need a financial boost from a business lender.

Fortunately, there are many financing options out there if you know where to look. Letâs explore the types of funding available to you, along with our lender recommendations.