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January 22, 2020

How To Price A Product The Right Way: Pricing Strategies & Smart Tips To Succeed

Pricing is foundationally important to your business, and that careful dance between your product and its price is both an art and a science. Price too high and you might not see the sales you deserve; price too low, and the undervaluation of your product sends the wrong message to consumers and may cut into your profit. What’s a savvy business owner to do?

Be smart about pricing!

Do your research, analyze trends, and demonstrate flexibility. Pricing is foundational and it needs your constant attention.

Before You Set Your Price, Know Your Costs

It might seem simple in hindsight, but some business owners don’t know or haven’t calculated the cost of making (or obtaining) their products, and you can’t set a price without knowing that crucial detail. Period. The cost of goods sold includes everything from the material costs to labor and everything in between. (Don’t forget to factor in all your overhead, too. Rent. Electricity. WiFi. Shop fees. Advertising.) If something is priced correctly, the sales cover the cost and turn a profit. Priced too low, you lose money (or your product loses esteem!); priced too high, you may lose sales altogether. Meticulous budgeting is necessary if you want to step-up your pricing game.

Creators of lists and lovers of spreadsheets will rejoice at the chance to employ those skills to run cost analysis. Be judicious and thorough, and once you have the bottom-line for all your products, then you can develop a pricing strategy that fits with your business.

5 Types Of Pricing Strategies You Can Use

Each pricing strategy has its own pros and cons depending on several factors, including (but not limited to) the type of business you own, your cost of goods, and how many products you sell. Remember that the key to any pricing strategy is to research your options, analyze the numbers, and adapt and show flexibility if sales are stagnant.

Cost-Plus

This is the most common method of pricing. Once you have calculated your cost of goods (material, labor, overhead costs, etc.), from there you add a percentage of sales on top to calculate your listed product price. There are differing theories about the best way to calculate the “plus” (the markup) part of the cost-plus system. Markup largely depends on the market and your competition. The retail industry standard is 50%.

As an example, we’ll use cost-plus pricing to look at a product I sell: paperback books. I have a paperback book that I print through a third-party distributor. Author copies of this book cost me roughly $5.00. That’s the material cost: $5.00. But I still need to add in other costs: labor, advertising, convention fees. Let’s round and say the cost of goods is $7.00. I know my industry and know that a full 50% markup on this paperback would be a hard sell. I sell the books at $12.99 for a $5.99 profit.

From there, depending on where I’m selling the books (my website, an online store, a convention), I can calculate how many books I need to sell for my bottom-line and how many I need to sell to make a profit.

Cost-plus pricing has a lot of advantages. It lowers your risk for loss, is easy to calculate, and makes it easy to navigate price increases as costs change. Additionally, cost increases are passed on to the customer, and these price changes are easy to explain to suppliers and customers. It works well for stable industries where material and overhead costs don’t change. The disadvantages? A set markup ignores demand, determining the cost of goods may not be exact, and there’s no incentive to cut costs or streamline on the supplier end.

Loss Leader

A loss leader is a product offered at a profit loss in order to encourage customers to buy additional products or services. This is also an industry pricing strategy in publishing and many other businesses that have a consumable or buildable client base. So, giving away a free copy of book one of a series is a great way to grab readers who will subsequently spend to buy the rest of the books. This also works for game consoles or other technology: often, you can get a console at a reduced price because buying individual games is how the company turns a profit.

There are also more predatory ways of using loss-leading, which is why it’s banned as a pricing practice in 50% of the United States. (And it may not be illegal, but restricted, in your state, so if you have a question about the legality of your pricing model, please contact an expert.)

The advantages are that it works well for industries that want customers to keep coming back for repeat sales, and it’s a safer model for a company that is large enough to absorb the initial loss. The disadvantages? Predatory practices ruin it for everyone.

Skim Pricing

“Riding down the demand curve.” Skim pricing is when you start off with a high price and lower it slowly to reflect competition/market over time. Game consoles work as another great example of this pricing model. When a console is first released, it’s marketability comes from anticipation and a feeling of scarcity. However, the product can’t sustain itself at that price and will come down over time to reflect a competitor’s prices more effectively.

The advantages to skim pricing are that it creates a high-profit margin after launch and helps recuperate costs quickly. But if you don’t have the clout or product to pull off the high price, this pricing model could backfire. Also, businesses need to find a way to incentivize the product if consumers know price skimming is coming and subsequently wait for the lower price.

Market-Oriented Pricing

Also called competition-based pricing, this pricing model relies on an understanding of what else is currently available from the competition. Based on knowledge of the market, a company will price its product higher or lower, depending on the needed strategy. Does your company want to offer the same service or product for less? Or do you want to advertise your superiority over the competition to prove why your brand is worth more? Researching your competition and their prices is an absolute requirement.

The advantage of market-oriented pricing is that you get a leg-up over the competition — and it’s fairly simple to price yourself based on what the competition is using. The disadvantages are that not knowing why a product is priced that way is a short-term solution, and following the crowd doesn’t always pay off (remember that time you copied another kid’s math worksheet answers and they got all the questions wrong?). If you want to price an item based on a market-oriented pricing model, that’s fine, but make sure you are running all the numbers, too, and that your decision is rooted in your long-term business needs.

Anchored Pricing

Price anchoring has a lot to do with human psychology. (Pricing, in general, is often based on psychological research; human beings aren’t exactly the most rational of consumers.) The psychology is this: Humans tend to place importance and value on the information they hear first. So, if the perceived value of a product is $1000, slashing its price to $399 induces a great feeling of savings for consumers. But shhhh…the price was going to be $399 the whole time. (It’s like magic. Ooooh. Ahhhh.)

In retail, we see listed prices all the time that are pure invention: no one was going to pay that price. But if you see the original price connected with savings, your brain will be more likely to make a purchase. Anywhere you have a listed price and a sale price, you’re seeing anchoring in action.

Anchoring is also seen when you price a luxury item significantly more expensively than your target product. People will buy the target product feeling like they received a deal.

With anchored pricing, people will feel like they are getting a deal, and the product benefits from a perceived higher value. It’s not all good, though. People can become loyal to price and not company, and consumers may be annoyed at the tactic.

4 Major Considerations For Setting Prices

Pricing psychology is a major factor in your pricing decisions. There are copious books, research papers, and websites dedicated to the exploration of how the human brain works during purchasing decisions. You may or may not have known the names for the different tactics, but once you learn them, you see them employed everywhere.

One thing popular in the United States is charm pricing. Charm pricing is where you price something ending with a 9 or 99. For example, $19.99 instead of $20.00 or $5.59 instead of $5.60. It is one of many psychological pricing tools you can employ.

I would highly encourage you to check out additional resources, as we can only scratch the surface here. However, beyond the psychology of pricing, there are four other specific considerations you should keep in mind when setting prices:

Know Your Customer

It might be simple, but it cannot be understated.

Do. Your. Research.

Who is buying your product? Who buys your product generally? Who are your repeat customers? What pricing strategies worked in the past? Knowing your customers is knowing the psychology of their purchasing habits and understanding the marketing tools that would turn them off.

Know The Competition

Even if you don’t use competition-based pricing, you should still research your competition’s prices on the regular. Informed pricing is empowered pricing, and you cannot be informed unless you know what your competition is selling their product for.

Have A Financial Target

Don’t forget to consider a financial goal as you set your product pricing. Even if your goal is to break-even, that should translate into numbers. How many of X do you need to sell at what price to cover your costs? To make a 20% profit? To be able to take your family to Disneyland? Whatever the need, make it a goal, and give it numbers.

Know Your Worth

Heart-to-heart moment: it shows great respect for you and your product to price your work well. Both over-valuing and under-valuing yourself is a mistake. When you implement a pricing technique, it needs to come from a place of understanding: what does this cost to make and how much is it valued? You are worth more if you are in demand, it’s true, but humans will also pay more for things made with careful love and quality.

How A Good eCommerce Platform Or Point Of Sale System Can Help You Track Costs & Profitability

Math and spreadsheets are fun! For some people. For a few people. Select people, perhaps. But for the rest of us, there’s good news: eCommerce and point of sale systems now have reporting tools that can calculate pricing factors with a click of a button. According to our Merchant Maverick eCommerce and POS experts, any good software will include the cost of goods sold and profitability reports. Advanced reports can even track prices over time or specific vendor costs; employee labor costs and job costing.

POS products like Lightspeed have specific reports for businesses to manage markup and margins, and creating promotions.

Accounting software may also have access to reports that manage pricing tools. Check out our top accounting software picks post to see if there is a good fit for your small business needs.

Don’t Forget To Keep Testing Prices

Markets and products change all the time, and if you aren’t staying current on pricing in your industry, you won’t be able to navigate the shifting tides. Test a price and monitor its sales over time. If patterns emerge, use that knowledge to set a more permanent price.

Your pricing model is a guide, but prices and strategies shouldn’t grow stagnant. Being flexible and understanding the market, your bottom-line, your markups, and your margins will all help create a successful business.

The Bottom Line: Pricing Your Products Is Key To Building A Sustainable, Profitable Business

Pricing truly is the most important business decision you can make. There are things you can control about how you run your business, and one of them is the price. Your pricing should drive profit, and long-term profit, too — not just short-term sales. A good boost of sales during a promotion is nice, but it’s not a sustainable pricing model.

Know the competition, but don’t venture blindly into pricing without a clear understanding of your costs and market, too. If your current situation limits experimenting with building up an inventory or investing in advertising new pricing, you can look into a working capital loan to jump-start or renew your business growth!

No matter what, research, analyze, and demonstrate flexibility.

The post How To Price A Product The Right Way: Pricing Strategies & Smart Tips To Succeed appeared first on Merchant Maverick.

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December 6, 2019

Square For Nonprofits: Everything You Need To Know About Seamlessly Accepting Donations, Running Events, & Selling Merch With Squareâs Platform

If you are looking to expand fundraising possibilities for your charity and are considering Square to process payments for your nonprofit, you may have a lot of questions. Fortunately, you’ve come to the right place; this post covers all the information you’ll need to make an educated decision. We’ll look at the costs, fees, and all of the features that wait for you behind the curtain of Square’s processing. Square constantly updates what they offer, so there’s a good chance that within the next year, Square will offer even more features for nonprofits. That’s not to say that Square isn’t already a viable option for charities to take paymentsâyou’ll find that from setting up a free online shop to engaging your donors throughout the year, Square provides all the tools you need to get going, with options to integrate or add features as you need them. Let’s get started!

How Do Nonprofits Benefit From Using Square?

One of the biggest reasons I have a sweet spot for Square is that they have competitively-priced processing rates, and your nonprofit organization won’t face any surprise fees or markups on the backend. In addition to a straightforward fee structure, Square offers a considerable amount of free software.

Not only that, Square is so easy to set up that you can get your account up and running to start taking donations, sell merchandise, and even set up your website all on the same day.

While Square for nonprofits offers a plethora of benefits, it’s not without some potential hiccups, however. In the world of payment processing, one merchant’s dream is another’s frustration, so let’s take a look at what Square has to offer and discover if this solution is right for you.

The Limitations Of Using Square for Nonprofits

It’s important to understand that Square isn’t a traditional merchant account provider. As a third-party processor, Square offers greater accessibility to a wider amount of businesses, but there’s inherently a bit more risk involved as far as account stability with this model. When a business or charity raises a red flag, sometimes it’s hard to make things right again.

One of the most important ways to avoid issues is to accurately disclose your type of business and ensure that you don’t sell anything on Square’s prohibited goods and services list that would throw you into the high-risk merchant category.

While representing a very small fraction of all Square’s accounts, the largest complaints against Square involve account freezes and terminations. No matter what processor you go with, you’re going to have this risk, however. That’s why we encourage all of our readers to learn how to reduce their risk of termination or funding freezes.Â

Beyond this, Square offers a lot of useful tools for a very low price, but it’s certainly not all-inclusive. When it comes to SaaS (Software as a Service) for a charity, you can find other options that cover the basics for next to nothing — and there are also more complex solutions that go as high as $15K for mid-sized charitable organizations and above. It really depends on what your organization needs in ancillary tools.

With that in mind, let’s take a look at what to expect with Square, and then look at how your charity can make the most of this low-cost option.

What Are Square’s Fees For Nonprofits?

As I mentioned before, what you see is what you get as far as payment processing costs. You won’t have any other additional monthly fees: no authorization fees, statement fees, refund fees or PCI compliance fees. You’ll also pay the same fee no matter what type of card your customer uses.

Be aware that accepting in-person payments versus web or invoice payments varies slightly, however.

Here are the Square fees for nonprofits:

2.6% + $0.10 for any tapped, dipped or swiped cards you take in person
Â 3.5% + $0.15 when you enter in a credit card number manually from the SquarePOS app, take payment in your Square Virtual Terminal, and process card-on-file transactions, including recurring invoices.
2.9% + $0.30Â for Square Invoices and eCommerce donations as these are both web-based transactions

You can also learn a bit more about Square’s Pricing in our article, How Much Does Square Charge?

Note that Square’s fees for nonprofit organizations are exactly the same fees that small businesses pay, and they’re designed for organizations that process less than $250,000 per year. Does your charity have higher projected donations coming in? Square may design a custom pricing package for charities and small businesses that process more than $250,000 per year in sales, but they consider that on a case-by-case basis rather than offering any sort of standard pricing for nonprofits.

Now that we’ve got the fees out of the way, let’s see what free goodies and other options await with Square for charities.

8 Ways Your Nonprofit Organization Can Make The Most Out Of Square

Square offers more than just payment processing for the nonprofit organization. Let’s take a look at the free tools Square offers that could support your charity in several ways.

1. Accept Donations Online

You have quite a few options to accept donations online with Square. The easiest option is to create a free Square site with ready-made templates that make it easy to build a simple web storefront. You can create a space that explains your mission and lets your donors contribute to the cause, or make a fully functional eCommerce store that allows you to sell things like t-shirts and other merchandise to support your organization and mission.

To start accepting donations, simply click Donations from your online dashboard and add the details. You can also allow custom donation amounts to let your donors give the amount of their choice, up to $1,000.

If you have multiple focuses for your nonprofit, you can create more than one campaign on your site. Just repeat the process in your dashboard from the donations area. That way if you want a focused fundraiser, you can do so while still maintaining the ability to accept general donations.

Below is an example of a storefront using Square’s free site template. You have a range of colors, but customization is limited. Also, take note that you do not have a custom domain with Square’s free site.

You can also upgrade the free site to a premium option through Weebly â it’s all easy to navigate and choose through your Square dashboard. This way you’ll get a custom domain and other bells and whistles that help you create a site you want for your cause.

If you already have a site, you can choose from one of the plugin integrations for Square at your Dashboard for a pretty easy setup.

If you’ve got some expertise when it comes to code (or have a developer on staff) you can build a branded checkout flow with Square Transactions API that allows you to accept digital wallets, too. Check out How To Accept Online Payments With Square for a full, in-depth explanation of each of these possibilities, and a few more (like in-app purchases).

2. Accept Donations In Person

Hoping people have cash on hand or the even more archaic option â a check â can really limit you. When you set up your Square account, you’ll get the free magstripe reader, but we strongly suggest that you opt for the Square Reader for contactless and chip. Square’s chip reader is the best way to protect yourself from chargebacks and give people more options (and convenience) to donate. That’s because chip readers better meet current security standards. The chip reader is competitively priced under $50.00. This little reader is an important tool to keep your costs down in the long run.

You have even more options in hardware, however. Whether you need something mobile or you need something a little sturdier for a kiosk or desk setup or both, you can find what you need to accept payments in person.

Want even more information on Square’s hardware options? Check out The Complete Beginner’s Guide to Choosing Square POS Credit Card Readers And Cash Register Bundles.

3. Take Donations And Orders Over The Phone

Like most point-of-sale software, Square comes with a virtual terminal right on your dashboard that allows you to take a payment over the phone or manually key in credit card data. What’s important to understand here is that a virtual terminal is really the only way to safely process credit card data. That’s because when you receive credit card information, security has to be considered during transmission and storage.

Jotting credit card information down a piece of paper or worse â keeping this information on a spreadsheet â is a big no-no. You’d be surprised to find out how many organizations store credit card data this way, but in the event of a breach, your business will face expensive fines (not to mention a huge PR issue).

Taking donations for your charity over the phone is really easy with Square. You simply enter in the credit card data on the form. Since the full credit card number isn’t visible once you key it in, you never have to worry about this information being vulnerable.

4. Recurring Donations

As a charity, there is probably nothing that feels better than an ongoing commitment from your supporters. These folks help you keep up your daily operations and allow you to plan for future growth.

Square makes setting up recurring donations super easy for your charity. Whether you’re on your mobile device or at your full Square dashboard on your PC, you can create what you need.

I’ve included the screenshot below so that you can how easy it is to set up and schedule your invoice for delivery on whatever recurring plan you want.

If you desire more consistent branding for your charity, you have some options. Check out the full post How To Use Square For Recurring Payments and Invoices for information on integrations or a pre-built workflow.

If you’re wondering about any additional cost regarding invoice scheduling for charitable donations, I have some good news: Setting up recurring donations for your charity doesn’t cost anything extra beyond the processing charge (3.5% + $0.15).

5. Sell Merchandise

Ready to sell merch at your event or want to offer online sales? As mentioned earlier, you have some options when it comes to setting up an online store via Square’s free store or upgrading for more space or design freedom.

Selling in person couldn’t be easier, either. Square’s free Point of Sale app works as a cash register or mobile app, so you can run a gift shop or merch table at a fundraiser. You can even accept payments for charity auction items right then and there (or send an invoice for payment after the event).

Whether you sell merch at an event, through your online store, or you take a phone order through your virtual terminal, Square syncs the sale at your dashboard so everything stays up to date. All your inventory is tracked across all your sales channels. When it’s time for a sale, you simply select the item from your inventory and you’re all set to make a sale. You’re also free to just enter in any amount and charge a card that way as well. After entering their email, your customer receives a digital receipt, and you now have their info.

You can also set up alerts at your dashboard to stay on top of dwindling t-shirts or other fundraising merchandise you offer. That way you can re-order supplies before stock drops to zero!

6. Manage Events And Registration

Planning an event for your charity can help you connect with both your supporters and those who become one. That’s why I’m glad to see that through Square, you can also find what you need to sell tickets for any event you have in the works. You’ll do this through your online store. You can set up your tickets for electronic delivery or you can print for shipping or in-person pickup options. Square gives step-by-step information on how to sell event tickets through their help center.

Square also has a partnership with Eventbrite so it’s that much easier to organize, manage your event, and sell your tickets.

The great thing about selling with Square is that your sales for tickets, merch, and donations all seamlessly sync to improve your record keeping. Whether you take a ticket at the door with your POS or sell a ticket online, everything stays up to date.

And that brings me to my next point: Square’s donation and sales tracking can improve your bookkeeping.

7. Track Your Income And Improve Your Bookkeeping

Square offers simple income tracking. You can download sales history, view deposits, and view everything that’s happening over a set period of time.

View income by categories like merchandise sales, donations, or ticket sales. You can also compare new givers with long-time supporters, as well as average donation size. While you’re not going to see more advanced reporting features with Square Analytics, we feel it delivers more than expected considering these features are completely free.

Need something more? One thing to note is that Square integrates with Quickbooks so you can sync sales data here and get the sales or expense reports you need all in one place. QuickBooks has some specialized accounting features for nonprofits, which can make it a must-have piece of software.

8. Collect Donor Information And Engage

You can export a list of your donations or the details about your donors from your online store at any time. All of this is accessed under Order Management right from your online dashboard.

As you collect donations, you can also manually enter any notes about your supporters. Because electronic receipts are delivered when your customer shares their email, you can also build a robust email list for future marketing.

Square has a few customer engagement features that are completely free. The emails that you collect during transactions are yours to add to a separate email campaign service, of course. You can also create, import, and manage all of your customer profiles within your Customer Directory, which you can then use to get more insights into your donors and plan future giving campaigns based on that information.

You don’t need to find a solution outside of Square for email marketing tools, however. Square Marketing gives you some pre-designed email templates with campaign suggestions and scheduling tools that help you create and manage your email list and marketing campaign. Square Marketing Starts at $15 / month. In the screenshot below, this particular campaign provides those on your list with a special offer. To the right, you can see that you have a selection of templates and themes to create something in line with your branding. Though it’s not fully customizable, you can add your logo, business name, and other images where desired.

Email remains one of the most cost-effective marketing tactics, so it’s nice to see that Square makes it easy to collect emails or opt for this relatively low-cost email marketing tool.

Is Square Right For Your Nonprofit?

Square remains a strong option for most nonprofits. You can start taking donations — and even have access to a few ways to grow — without having to spend any extra money right off the bat. However, for advanced reporting features, marketing, and other integrations you may need, you’re going to pay more each month. And in my mind, that’s okay. Square provides basic reporting features so you can gain insight into patterns of giving as well as set up multiple ways to give on your site and more ways to connect, and that’s all free.

While Square does not offer any special discounts for charities, the processing fees are competitive. And with all of the freebies, it’s a bit remarkable for a processor overall. Be aware that account stability issues exist, however, but they aren’t unique to other processors by any means. Be sure to review each section or check out our full Square Review so that you understand how to make the most of this option.

Not sure if Square is right for you (or already sure it isn’t)? Read Become A Hero & Save Your Charity Money With Discounted Credit Card Processing For Nonprofits or check out the Top 7 Square Alternatives.

Want to get started with Square and open an account? This step-by-step tutorial shows you how to set up an account, navigate your dashboard, start accepting donations or selling merchandise. Have any questions? We’d love to hear from you.

The post Square For Nonprofits: Everything You Need To Know About Seamlessly Accepting Donations, Running Events, & Selling Merch With Squareâs Platform appeared first on Merchant Maverick.

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December 4, 2019

How To Sell At A Farmersâ Market (Plus 7 Clever Tips To Succeed Before You Even Get Started)

It’s a beautiful spring day, the sun is shining, and the birds are chirping. Out in the fresh air, you’re surrounded by vendors selling the freshest local produce, natural products, and unique handmade gifts. No, this isn’t a dream — it’s a trip to your local farmers’ market.

Farmers’ markets are growing in popularity across the nation, so it’s no surprise that farmers, artists, and other local vendors are capitalizing on this money-making opportunity. Perhaps you’ve even pondered the idea, or maybe your family and friends have suggested you make some extra cash by selling your handmade or homegrown wares.

In this guide, we’ll explore how to become a seller at a farmers’ market. While it may seem as easy as grabbing your goods, setting up a table, and bringing in customers, there are actually tips and strategies to keep in mind to improve your odds for success … and increase your profitability. From selecting your products to marketing to buyers, we’ll cover it all to help you get started on the right foot. Read on to find out how you can start selling your goods at your local farmers’ market.

Why Are Farmersâ Markets So Popular?

From small towns to big cities, farmers’ markets are quickly popping up everywhere and attracting people of all ages. What makes a farmers’ market so appealing? It might be easier to ask what’s not to love about these local stops!

There are a number of reasons that more people are frequenting farmers’ markets. One of the top reasons is that these are places where you can purchase fresh local produce, most of which is organic and isn’t genetically modified. Compare this to your local supermarket where you aren’t sure of when the produce was picked and shipped or how it was grown. Farmers’ market produce is the freshest, and often the healthiest, that you can find.

Buying locally isn’t just good for your body — it’s also better for the environment. Produce at farmers’ markets usually comes from small family farms, which use fewer pesticides and chemicals. Because these products aren’t being shipped around the country, shopping at your local farmers’ market also conserves fossil fuels.

When you shop at your local farmers’ market, you’re supporting small businesses, whether it’s a small family farm or a local artist peddling paintings, pottery, or other handmade art that you won’t find in your local department store. In addition to supporting your local economy, attending a farmers’ market is a great way to meet new people. Farmers’ markets are family-friendly (and sometimes, even pet-friendly!) events that let you meet and socialize with people in your community. Some farmers’ markets even offer live music, classes, and other special events that only add to the fun. Add in local food trucks serving delicious meals and treats, and it’s not hard to see why farmers’ markets are truly the place to be.

Now, it’s pretty easy to see why you would visit a farmers’ market, but what are the benefits for sellers? In a 2015 survey, the USDA found that over $700 million of goods were sold at over 8,000 farmers’ markets around the United States — and the majority of that money is being funneled directly back into local economies. The USDA also found that farmers and ranchers make less than 16 cents for every dollar when selling to retailers. On the flip side, they can retain nearly 100% of their profits when selling locally through farmers’ markets.

10 Kinds Of Products You Can Sell At A Farmersâ Market

Despite its name, you don’t have to be a farmer to sell at a farmers’ market. There are lots of ways that you can connect with the community while earning a profit. Items to sell might include:

Produce

Sure, you don’t have to be a farmer to sell at a farmer’s market, but if you are, you can certainly bring your freshly grown produce to sell to your customers. Seasonal local fruits and vegetables really sell, but don’t forget about unique products you won’t find in most supermarkets (think colorful heirloom tomatoes or purple cauliflower). No matter what you bring, make sure that you only provide the freshest, highest-quality produce for your customers.

Don’t feel stuck to just fruits and vegetables, either. Mushrooms and fresh herbs that you’ve cultivated yourself are also big sellers at farmers’ markets, providing you with additional opportunities to earn some extra cash.

Milk, Meat & Eggs

If you raise cattle and chickens, it’s a no-brainer to bring your milk, meat, and eggs to the farmer’s market to share with your community while making a profit. These are popular items at farmers’ markets because of freshness, but also because many people prefer buying from small farms that treat their animals humanely, as opposed to large factories that may have questionable practices.

Not a rancher, but you enjoy hunting? Venison, bison, and other wild game can be sold at the farmers’ market. And it doesn’t stop at fresh meat, either. You can always sell your dried meats and jerky that you’ve marinated, cured, and dried yourself.

Baked Goods

Your family and friends think you could be the next Betty Crocker, so why not bring your baked goods to the masses? If you love to bake, there are endless possibilities and a whole lot of money-making potential at your local farmers’ market. Bake your homemade cookies, cakes, pies, scones, and cinnamon rolls and sell them to customers during your free time. Again, you can think outside of the box to boost your profit potential by selling unique items such as dog treats or treats for customers with special dietary needs (i.e. vegan or gluten-free).

Flowers, Plants & Seedlings

From season to season, people spruce up their homes inside and out with colorful flowers, outdoor plants, and houseplants. From flower baskets that add a touch of color to your front porch to common and unique species of plants, many customers bypass big-box home improvement stores and instead purchase from local growers.

You don’t even have to wait to have fully grown plants and flowers. Some shoppers may prefer to buy seedlings that they can plant and grow themselves. Succulents and herbs are also popular options to consider.

If you grow roses, tulips, lilies, or other beautiful flowers, you can also create unique arrangements that shoppers may snap up for weddings, prom, Valentine’s Day, or even “just because.”

Honey

If you’re a beekeeper, cash in on the benefits of your (and your bees’) hard work by selling your delicious honey at the farmers’ market. Customers can purchase high-quality honey for use as a natural sweetener, but there are also additional benefits of eating local honey. Local raw honey is often marketed as a natural home remedy used to help with seasonal allergies, soothe sore throats, kill bacteria, or even help you get a good night’s sleep.

Want your honey to stand out from the rest? Switch up the way you process your honey to create creamed honey, or consider adding natural flavors to make your own unique honey blend.

Also, don’t overlook the value (for health and your wallet) of pollen granules. These tiny pellets contain a mixture of nectar, saliva, and pollen and are rising in popularity due to their perceived health benefits. Pollen granules are used for treating inflammation, strengthening the immune system, reducing stress, and other ailments.

Soap & Skincare Products

As we learn more about the chemicals in everyday household items, more people are stepping away from these potentially harmful ingredients and going a more natural route. If you’ve created the perfect recipe for homemade soaps, lotions, or other skincare products, set up a display at your local farmers’ market to peddle your natural concoctions.

As more people move to natural products, the farmers’ market in your area gives you the perfect platform for selling your goods. There are lots of opportunities in this space, from creating your own natural (and great smelling!) bug repellent to homemade sugar scrubs and natural deodorants.

One thing to remember is that you can be multi-dimensional at a farmers’ market. For example, if you keep bees, not only can you sell honey and pollen granules, but you can also sell natural beauty products made from pollen, honey, or beeswax.

Beverages

Need some inspiration for what to sell at the farmers’ market? Look no further than the neighborhood kid with a lemonade stand. And the great news is that you aren’t just limited to lemonade, although selling freshly squeezed lemonade to hot shoppers is an easy way to make some extra cash.

If you make your own local wine or mead, brew your own craft beers, or even make a mean cup of hot apple cider, selling beverages can help draw in customers. Your booth or display can serve as a showcase for your homemade brews, or you can sell beverages in addition to other products. Many people that frequent farmers’ markets are looking for products that are unique and can’t be found in the local grocery store, so think outside the box. Flavored lemonades made with freshly squeezed lemons and natural flavorings, kombucha, and other tasty beverages can be sold by the glass, bottle, or jug.

Prepared Foods

Spending a long time at the farmers’ market can leave shoppers feeling famished. Why force hungry customers to drive to restaurants when you can bring the food right to them? If you operate a food truck, consider bringing your tasty fare to the farmers’ market. If you have openings in your schedule, a partnership with a local farmers’ market can fill your weekends with customers and the profits they bring with them.

Arts & Crafts

Whether you’re a professional or just an amateur artist, locally-made arts and crafts are big sellers at farmers’ markets. No matter what type of art you make, a farmers’ market is the perfect platform for selling your creations.

Paintings, drawings, embroidered items, crocheted blankets, hand-painted t-shirts, pottery, wood carvings, sculptures, and homemade greeting cards are just a few of the arts and crafts you can peddle at your local farmers’ market.

Other Unique Goods

Don’t see anything on the list that appeals to you? Then tap into your own unique talents. The great thing about the farmers’ market is that there are relatively few limitations when it comes to what you sell. While you can’t sell anything illegal or dangerous, you can let your creative flag fly and bring something truly unique to the table. What can you offer that is different and unique? Exotic spices, ethnic goods, homemade candles … the list goes on.

One way to be a successful seller is to think about what your customers want or need. For example, if you live in an area known for its tasty barbecue, consider selling your own dry rubs or barbecue sauce. Whatever you decide to sell, make sure that it’s unique to attract the most customers. Homemade, natural products are popular, but items like vintage clothing and shoes may also sell quickly. Whatever you do, just make sure that what you’re selling is allowed by your chosen market.

7 Ways To Prepare For Selling At A Farmers’ Market

Once you’ve decided that you want to sell at your local farmers’ market and you’ve decided what products you’ll be offering, the hard work is over, right? Not exactly. Whether your goal is to sell on occasion to earn some money on the side or you dream of bringing in a steady income by selling your goods to the community, there are some steps you need to take to help boost your chances for success.

Find Farmers’ Markets In Your Area: Once you know what to sell, the next step is to figure out where to sell it. And just like the unique products you’ll find from sellers, not all farmers’ markets are the same. Get a good idea of the culture, people, and products at each farmers’ market by visiting them yourself. Keep your eyes open for markets that have a need for what you’re offering, but don’t forget to find a farmers’ market that’s a good fit for you. For example, if there are no other artists and you’d feel uncomfortable selling your art, keep searching. If you’d like to bring your four-legged friend with you, look for a dog-friendly market. You can also turn to the internet to learn more about the farmers’ market in your city and surrounding areas. Look for official websites and social media profiles that feature pictures, posts, and information about each market. Finally, you should get an idea of the registration process. While this process varies across markets, you need to be aware that vendor registration windows aren’t always open, and you may have to sign up weeks, months, or even longer in advance to secure a spot. You can find this information online or talk to a manager in-person to learn more about signing up as a vendor.
Research Local Ordinances & Health Regulations: Nothing can bring your business to a halt faster than getting shut down by the health department or local authorities. Do your research to learn about local ordinances and health regulations, such as how produce and prepared food must be stored or how baked goods are prepared. Laws and regulations vary, so contact your local health department to learn more.
Make A Business Plan: Even if selling at a farmers’ market feels more like a hobby than a business, it never hurts to create a business plan before you get started. This business plan can be used to outline your goals, how you plan to finance your business, and your marketing plan. If you’re panicked at the thought of a business plan that’s an inch thick, don’t — a one-page plan is sufficient for keeping you on track. Don’t know where to get started? Learn how to create your one-page business plan in no time.
Get Startup Capital & Set A Budget: While selling at a farmers’ market can certainly be one of the more inexpensive ways to make money off your homemade goods, there are still some expenses to consider. One of the most common expenses is a booth rental fee. You need to consider other expenses, too — think signage for your booth, tablecloths and other items to spruce up your display, price stickers, and the cost of materials and packaging for samples. It sounds like a little, but these small expenses can add up quickly if you don’t watch out. Determine if you need to get financing before you start selling, set a budget, and stick to it. Want more tips? Check out our guide, How To Start A Side Hustle.
Look Into Business Registration: Depending on local regulations, you may be required to register your business before you take part in a farmers’ market. Some farmers’ markets require you to provide an Employer Identification Number (EIN) or Taxpayer Identification Number (TIN) when you register as a vendor. If an EIN is required, it’s easy to obtain one for free from the Internal Revenue Service. Contact the farmers’ market you’re interested in to learn more about the requirements for sellers.
Research Business Insurance: Some farmers’ markets require their vendors to have their own business insurance. Even if this isn’t a requirement, though, you still want to research your options to protect yourself from liability. If you’re unsure of how to get started, check out our article on general liability insurance for your business and contact your chosen farmers’ market to determine if insurance is a requirement. They may even be able to recommend local insurance companies that other vendors use.
Get Accounting Software: Even if you’re just making a little extra money on the side, do you really need accounting software? Yes, you do, and though it may seem like a pain now, you’ll thank us later. No matter how much you’re bringing in from your sales at a farmers’ market, it’s important to keep track of your finances. The best way to do that? Accounting software. The good news is that there are many options available that are low cost (or even free!) and easy to use, even if you have no prior accounting experience. Tracking your finances will help you see how much money you’re making, as well as where you’re spending it — allowing you to determine where you can make changes to increase your profits. You’ll also be glad that you kept track of finances when it’s time to pay your taxes. If you don’t know where to get started, take a look at some of our top accounting software choices for small businesses.

Should You Accept Credit Card Payments At Your Farmers’ Market Booth?

In a world where paying with plastic is quickly becoming the standard, you might be wondering if you should accept credit cards at your farmers’ market booth. Unfortunately, there isn’t a clear answer, but here’s what you should consider before making your choice.

Mobile point-of-sale (POS) apps make it easier than ever to accept credit cards. With your smartphone or tablet and a card reader provided by your chosen provider, you can accept debit and credit cards with ease without a bunch of heavy equipment and complicated systems. Some credit card readers are even available for no cost, and you could even score extras like stickers that advertise that your booth accepts debit and credit cards. There are lots of POS apps to choose from, so do your research on top choices like Square, SumUp, and PayPal Here.

On the flip side, though, you don’t have to accept credit card payments. Many farmers’ markets are prepared for customers that are paying with plastic, so they allow customers to purchase tokens which can be used to buy products from vendors. At the end of the day, these tokens can be redeemed so the seller gets their earnings. If you’re thinking of going the cash-only route, check out our article, Can You Really Run A Cash-Only Business?

If the farmers’ market you’ll be attending does not offer this service, you definitely want to consider getting a POS app and card reader so that you can serve all customers, regardless of how they’re paying. Mobile POS apps come with additional features that may be beneficial to your business, such as inventory tracking and sales reporting.

Another consideration to keep in mind is whether or not you’ll be taking larger orders or custom orders. If this is the case, you’ll need to have the ability to create invoices for tracking your orders and getting paid by your customers. Let’s say that the holidays are coming up, and you’ve been commissioned to make baked goods for a Christmas party. Before you invest your time and money into fulfilling the order, you can make sure you get paid by sending your customer an invoice that can even be paid online. Some mobile POS systems like Square Invoices allow you to create and send invoices, or you can use your accounting software if that feature is available.

Can You Accept Food Stamp/SNAP Benefits At A Farmers’ Market?

Statistics show that the Supplemental Nutrition Assistance Program (SNAP) helped 40 million Americans each month in 2018. This program — formerly known as food stamps — provides benefits that allow low-income households to afford food. SNAP participants are provided with an Electronic Benefits Transfer (EBT) card, which is used like a debit card at participating retailers. This includes grocery stores, convenience stores, and, yes, even farmers’ markets. This system makes it easy for you to accept EBT without having to jump through hoops.

Most farmers’ markets have a system in place that allows SNAP participants to purchase tokens with their EBT cards. These tokens can then be used to make purchases. Many states even reward SNAP participants for shopping at farmers’ markets with “double-up” programs. These programs match each dollar spent (up to a certain amount), allowing these households to receive more healthy and nutritious food using their benefits.

5 Clever Marketing & Promotion Tips For Your Farmers’ Market Stand

You’ve decided what to sell and where to sell it — now, it’s time to sit back and wait for customers, right? Wrong! While you won’t have to have a huge (and expensive) marketing campaign for your farmers’ market stand, there are some steps you need to take to make your business more appealing to shoppers.

Business Cards: A customer that isn’t interested in what you’re selling now may become a customer in the future, or you might have a customer that wants to spread the word about your business. Make sure that they can get in touch with you by passing out business cards. You can easily create business cards online and have them shipped to your door for a low price. Make sure to include critical contact information, including your name, the name of your business, your email address, social media or website links, and any other relevant information.
Email List: Allow your customers to sign up for an email list. There are lots of options for the emails you send, including new product announcements, upcoming sales, or your schedule if you attend multiple farmers’ markets and events. Mailchimp is one good option that’s free for small businesses.
Social Media: Social media isn’t just for connecting with overseas relatives and old classmates. Social media is a great outlet for advertising your business. Create a social media profile for your business and provide contact information, photos of your products, customer reviews, and important updates. You can also join groups in your area that allow you to interact with customers, take preorders, answer questions about your products, and more.
Dress Up Your Display: You can’t just throw your products on a table and expect them to sell. Sure, you may make a little bit of money, but to maximize profits, it’s time to pimp out your display. For this technique, you’ll have to invest a little bit of money, so make sure you budget and plan before implementation. Use signs, tablecloths, and decorations to make your space stand out. Arrange your products neatly and make sure that everything is labeled and priced correctly. This is your chance to really show off your personality, so take advantage of the opportunity to attract customers.
Offer Free Samples: Nothing in life is free — unless you’re a customer and businesses are giving out free samples. While providing samples of your products does come with some expenses, allowing your customers to try before they buy is a good way to get them interested … and have them reaching for their wallets. Provide small bites of your baked goods or testers for your natural lotions and body products. Before distributing your samples, make sure that you’re aware of all health regulations to keep your business in operations and provide a sanitary shopping experience for your customers.

Are You Ready To Start Selling At Farmers’ Markets?

On the surface, selling at a farmers’ market seems easy, but as you can see, there’s actually quite a bit of work that goes into planning, prepping, and selling your products. While it may take a lot of hard work and expense to sell your products and make a profit, there are many benefits to peddling your goods at farmers’ markets, including low costs, more personalized interaction with your customers, and creative freedom.

It’s up to you to determine if selling at a farmers’ market best fits your business goals. Once you’ve made the decision to move forward, we offer plenty of great resources to help you launch and operate your small business. From learning how to apply for a small business loan to choosing the right accounting software and POS systems, you’ll find everything you need to make your business dreams a reality. Good luck!

The post How To Sell At A Farmersâ Market (Plus 7 Clever Tips To Succeed Before You Even Get Started) appeared first on Merchant Maverick.

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November 29, 2019

Small Business Payroll: Your Complete Year-End Payroll Guide

The year-end payroll gauntlet is fast approaching. With the holiday season in full-swing, taxes around the corner, and fourth quarter payroll requirements looming, there is a lot of pressure on business owners to complete these tasks smoothly and accurately (especially since even simple mistakes may accrue fines and fees). If you’re looking for a simple guide to walk you through your year-end payroll responsibilities, we’ve got you covered.

We’ve broken down the year-end payroll process into 10 easy steps. This way you can close out your payroll and ensure that you file all of the proper tax forms on-time. To make things even easier for you, we’ve also created a printable Year-End Payroll Checklist so you can mark your progress.

Small Business Year-End Payroll Checklist (PDF)

You can print the Year-End Checklist now and use it to follow along, or you can jump right in.

How To Complete Year-End Payroll

Year-end payroll is all about balancing your books, ensuring you’ve paid people the right amount of money, and double-checking that you’ve sent the right amount of taxes to the government. By the end of January, employees should have access to a W-2 or 1099, which is a record of payment received and taxes paid. You will also need to submit wage and tax information to the Social Security Administration (SSA) and the Internal Revenue Service (IRS).

Payroll is a year-long process: keeping your records updated as you go throughout the year will help with any end of the year accounting and paperwork management. Even if you outsource payroll, there is information you should verify and deadlines you shouldn’t miss. (Also, now is the perfect time to review your company’s payroll choices. Anything you/employees want to change before the new year?)

As always, the exact process for your payroll processing is dependent on your state and industry, so use these steps as a guide and verify with an accounting or bookkeeping professional.

Step 1: Verify All Employee & Company Information

As the year winds down, you will need to ensure that all of the information for your company and employees are correct. First, verify that your company name, tax IDs, and company tax information is updated and accurate. Next, make sure that your employee information is up-to-date. For employees, check the following:

Employee’s name is spelled correctly
Correct Social Security Number
Updated/accurate employee addresses
Lived-in/worked-in jurisdictions

If you find any discrepancies between recorded information and accurate information, update your files and/or let your payroll service provider know of any changes.

Step 2: Verify Wages, Taxes, & Benefits

After you’ve checked and made sure all your employee and company information is accurate, the next step is to run through and verify that your wage, tax, and benefit numbers match up with your payroll numbers. Here’s what you’ll need to verify:

Yearly PTO accrual
Worker status (active, terminated, on leave)
Filing status (exempt or non-exempt)
Number of exemptions
Year-to-date wages and taxes
Pre-tax amountsÂ

Most of the information above is on an employee’s W-4 form. Employees can change their tax information with the government at any time, so this is where you may find and remedy discrepancies. Bonus: Many payroll software programs have reporting features that will do this work for you.

Step 3: Order Your W-2s

If you run payroll yourself or if you do not have a payroll provider that manages your W-2s, you will need to order paper forms from the Internal Revenue Service. A W-2 is a tax and wage statement for your employees. Contractors will receive a 1099 form. You can also file these forms online on the IRS website. Paper forms take 10 business days to mail, so plan ahead and order these in December.

Step 4: Manage Paid Time-Off

What is your company’s paid-time-off (PTO) policy? Do you offer PTO as a lump sum at the start of the year or does your PTO accrue as the year progresses? Will your employee’s PTO reset in January? What happens to the unused time?

Some states have mandates on whether or not a company can clear PTO, so check with your accountant or bookkeeper about the laws in your state. If you pay-out accrued PTO, you will need to manage that payment with the last paycheck of the year and keep a record of that payment for tax purposes.

Step 5: Decide On Bonuses

If you are awarding bonuses, those payments must go out with the last paycheck of the year. You will need to keep a record of bonuses given for tax purposes.

Step 6: Update Your Compliance Posters

In November or December, it’s important to order your new labor law posters for the upcoming year. These posters are federally mandated and expected to be displayed in a conspicuous place where all employees can read them. Failure to post updated labor law posters could result in fines, fees, or even labor lawsuits.

Step 7: Update Payroll Information

Before you run your first payroll of the new year, you will need to update your payroll information. That includes checking for new tax rates, making adjustments to employee information, balancing PTO, and tweaking yearly deductions.

Step 8: Deliver W-2s/1099s To Employees

Your employees need their W-2/1099 forms documenting their pay and taxes for their own tax filings. You have a legal responsibility to deliver pay and tax information to employees by January 31st.

Step 9: File Your W-2s/1099s

File all W-2s and 1099s with the Social Security Administration by January 31st. (You may also need to file W-2s with your state or county, depending on location and local tax laws.) In addition to each W-2, you will send a W-3 form; this form is needed for each employee and is a summary of the information on the W-2.

Step 10: File Tax Forms 941, Form 940, and Form 944

Forms, glorious forms! You will need to pay your federal unemployment tax (FUTA) from the fourth quarter with Form 940. You must also file federal income taxes and FICA (social security and medicare taxes) through Form 941. The last form (Form 944) is an annual return of all paid payroll taxes. All are due by January 31st.

Payroll Year End FAQS

Still have questions about closing the books? Here are the most popular year-end payroll questions. Don’t see your question? Leave a comment below.

What does year-end payroll mean?

Year-end payroll is about checking that the numbers to ensure your payroll reports add up to the money you’ve given and withheld during the calendar year. This is the last opportunity before you file your taxes and year-end forms to reconcile any discrepancies, change or update information, or adjust payroll choices for the new year.

What year-end payroll forms do businesses need to file?

So many forms. The good news is that many of the payroll software options available offer tax and year-end payroll support, and many of these forms can be filed online. (Always check with your accountant or bookkeeper about your specific state and industry requirements.) Here are the most important year-end payroll forms you will need to file:

W-2 Form: This form reports wages and withholdings to the IRS
W-3 Form: This is a summary of the information in the W-2s. This goes with employee W-2s to the Social Security Administration.
1099 MISC: This is a statement of income for contractors.
Form 1096: If you’ve paid any contractors and given them a 1099 MISC, you will need to summarize that payment information and submit it to the IRS with this form.
Form 940:Â This is the form needed to pay your Federal Unemployment Tax (FUTA) liability to the government.
Form 941:Â This form is due quarterly and reports employee payroll taxes collected for each quarter. Payroll taxes include federal income taxes, social security and Medicare taxes.
Form 944:Â If your payroll taxes are less than $1000 annually, you may qualify to pay these taxes yearly instead of quarterly. Small businesses that qualify will fill out a Form 944 instead.
Form 1095-B: If you offer health insurance, you will need to send this form to the IRS and to your employee to document that health coverage.

When does year-end payroll have to be submitted?

All the forms related to year-end payroll reports are due by January 31st to their respective locations.

What year-end tax forms do employers have to provide their employees and contractors?

Employers need to send their employees a copy of their W-2 and contractors a copy of their 1099-MISC. This accounts for wages paid and taxes withheld.

When do employers need to complete their employee W-2s?

All W-2s need to be filed with the social security administration with copies sent to employees by January 31st.

When do employers need to complete their contactor 1099-MISCs?

All 1099-MISC forms must be sent to the IRS with copies sent to those who received nonemployee compensation by January 31st.

Get Started With Our Year-End Payroll Checklist

Small Business Year-End Payroll Checklist (PDF)

It’s understandable if all the steps above feel overwhelming. It’s best to think about year-end payroll like this: This is when you account for the wages and taxes you’ve paid and withheld throughout the year.

As you look to settle books and wrap up your fourth quarter taxes, you might find that you’re interested in outsourcing the task next year, if you don’t already. Some payroll software companies like Gusto and Intuit offer tax services as part of their payroll programs. Whether you’re running payroll yourself or outsourcing, use our Merchant Maverick Year-End Payroll Checklist to get started, and check out our other great payroll and tax resources for more help running your small business.

What Can I Write Off As A Small Business Tax Deduction?
Everything You Need To Know About Small Business Payroll
What Are Payroll Taxes? And How Do You Calculate Them?
Small Business Accounting: How To Close The Books At The End Of The Year

The post Small Business Payroll: Your Complete Year-End Payroll Guide appeared first on Merchant Maverick.

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November 20, 2019

Find The Next Grant For Your Nonprofit Through One Of These 7 Resources

It’s certainly not uncommon for nonprofits to struggle with funding, but grants can help alleviate woes in that department. In fact, grants are one of the best tools nonprofits can employ to build their funding profiles. It’s hard to argue with free money!

However, it isn’t always easy to find a grant that matches up with your organization’s specific mission. Don’t waste your time trying to sort the wheat from the chaff. At Merchant Maverick, we’ve spent hours researching nonprofit grants so you don’t have to. Hopefully, this post will provide a huge jump-start to your grant-hunting process.

Read on through to find out where to look for your next nonprofit grant!

How To Find Grants For Your Nonprofit

Nonprofit grants aren’t exactly quick to spot, but there are still plenty around if you know where to look. This list primarily covers online sources, but it doesn’t hurt to ask around with those you know in-person.

Note that in some cases, grants are specific to only certain industries. This means that your organization won’t qualify for every grant out there. However, with the right amount of research and dedication, you still should be able to find someone willing to help you out!

All told, you’ll want to find grant organizations that align with your mission and care about the public you serve. Additionally, it may be helpful to focus on local funders (or if you find a funder outside your area, it may help if they’ve already funded organizations within your local community).

When it comes to grants, keep a realistic mindset. Grants may be able to help out a bit when it comes to funding, but don’t expect grants to singularly solve your organization’s funding situation. On top of that, grants aren’t always easy to land. In many cases, you’ll be competing against numerous other organizations for a limited number of slots.

7 Places To Look For For Nonprofit Grants

We’ve combed through the web to come up with seven of our favorite places to find nonprofit grants. Check out our selection below:

1) Grants.gov

This federally-run online database is a great option for US-based nonprofits. There are many wide-ranging grants listed in the Grants.gov database. Grants here focus on a variety of categories, including health, education, income security, nutrition, and more.

Grants.gov is free to use and also offers an app for both the iOS and Google Play app stores. You can additionally sign up for the service’s daily or weekly mailing list to get frequent updates on government grants.

2) Local Resources

Many state and city governments offer grants for local nonprofits. To track down these grants, you should start by looking on your local government’s website. If that fails, it doesn’t hurt to reach out to the appropriate government branch for your organization’s industry to see if they offer grants.

Additionally, you may be able to find local associations made up of grant funders. Finding such an association could be quite beneficial because these funders may be more eager to work with nearby organizations.

Sometimes, local governments or funder associations will only have grants available in a select few industries, while others may have a wider range. The grants that are available to you will depend on your location.

3) Candid

Recently founded after the Foundation Center and GuideStar merged, Candid offers a free database with access to over 100,000 US-based funders through its Foundation Directory Online Quick Start. If you need deeper coverage, Candid also provides paid plans that include more in-depth funder profiles, as wells as recipient details and info on key decision-makers.

Like Grants.org, Candid offers an email news digest. You can sign-up on Candid’s website and get several newsletters delivered to your email inbox weekly.

4) Grant Gopher

Grant Gopher is another grantmaker database. Its free plan allows for basic searching of US-located funders, while paid plans allow for more robust search tools and email alerts.

This service is overall simple and easy-to-use. However, do note that you’ll need to register for a (free) account before you start searching the Gran Gopher database.

5) GrantWatch

Our third general grantmaker aggregation engine on this list, GrantWatch allows users to search for funders that match with their needs. Unlike the above two aggregators, however, this database requires a paid plan to do even a basic search (pricing starts at $18 a week with discounts if you pay monthly, quarterly, or annually).

This service digs up grants that fit community-based and faith-based organizations, hospitals, government agencies, research institutions, schools, and universities. There are also some grants available for small businesses and individuals.

6) Google

Using Google — or your favorite search engine — could be another great way to find grants in your industry. By simply searching for your industry’s name plus “grants” (and possibly also your local city’s or state’s name), you may be able to find a plethora of grants that aren’t easily accessible in the other databases listed here.

It’s also worth noting that Google enables you to receive email alerts about the search topic of your choosing. All you need to do is head over to Google Alerts, plug your desired search string into the text box, and press “Create Alert”. You can choose to receive alerts as-they-happen, up to once a day, or up to once a week.

7) Your Board Members

It never hurts to ask your board members if they know of any available grants. It’s possible some may be connected with an appropriate funding source and could make an introduction.

To start this process, you’ll want to attend a board meeting and inform the members that you’re looking for grants that closely match up with your organization’s mission. Be sure to inquire if they have any potential contacts, from family foundations to corporate foundations to other funders that could help the organization out.

Final Thoughts

Hopefully, this list can get you started on the search for your nonprofit’s next grant. As mentioned above, finding the perfect grant may not solve your organization’s funding situation, but it can still help out your bottom line. By utilizing the above tools, you should be able to come up with at least a few solutions for your organization to target.

Comment below if you know of more grant-finding resources worth sharing. Or, if you want to learn more about grants, check out this article on startup grants, or this one on small business grants.

The post Find The Next Grant For Your Nonprofit Through One Of These 7 Resources appeared first on Merchant Maverick.

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November 20, 2019

Simplify Your Small Businessâs Year-End Accounting With These 9 Easy Tips

It’s that time of year again — time for holiday parties, sparking lights and decorations, and gifts under the tree. As a small business owner, the holidays can add even more to your already full plate (and no, we’re not talking about your big family dinner). One of the most wonderful times of the year can quickly become one of the most dreaded for small business owners and entrepreneurs because of one little phrase: year-end accounting.

Despite being a hassle, though, year-end accounting serves several important functions. The year-end accounting process helps you prepare for tax time. You’ll also run critical financial reports that give you a clear picture of the financial health of your business. This helps you determine any action you need to take in the future to stay on track, boost your profits, or hit other company-wide goals.

Every business owner needs to do their year-end accounting. The good news, however, is that there are steps you can take to simplify the process. Some of these steps can be done at the end of your company’s calendar or fiscal year, while other steps are performed on an ongoing basis. Integrate these tips into your accounting workflow to save time, avoid overlooking errors, and be prepared for your year-end accounting process.

Use Accounting Software

If your business isn’t already using accounting software, what are you waiting for? Today’s accounting software allows you to keep your transactions organized and automates processes such as reconciling bank accounts or sending payment reminders. Depending on the software you choose, you’ll have access to a variety of accounting features that can help you throughout the year … and at the end of the year. This includes invoicing, estimates, expense tracking, inventory management, and time tracking. Your accounting software also allows you to run important financial reports needed for year-end accounting. If you’re new to accounting, don’t worry — most software is easy enough for anyone to use, even if you didn’t major in accounting! (If you don’t believe us, check out our top easy accounting programs.)

The software you choose should fit the needs of your business. For example, if you operate a small business with a handful of clients and only need basic features like invoicing and reporting, free accounting software may work for you. If you have a larger business with more extensive accounting needs, there are plenty of paid options available that offer additional features at an affordable price.

As the end of the year approaches, selecting and learning how to use your new accounting software can be a burden to a busy business owner. If your end-of-year to-do list is too long to add a new task, take some time to at least explore your options so you can have a fresh start for the new year.

Regularly Invoice Customers

Regularly invoicing your customers is necessary for a number of reasons. Not only does this help improve the cash flow of your business, but it also saves time with year-end accounting. In other words, don’t wait until the last minute to invoice your customers — make life (and year-end accounting) easier by invoicing your customers throughout the year.

The same holds true for invoice reminders. Your customers and clients get busy, too, and can easily overlook an invoice. Sending out payment reminders helps you get paid faster, improving your cash flow and reducing the number of unpaid invoices you have to deal with at the end of the year.

Your invoicing software or accounting software makes it easy to send invoices and payment reminders, as well as receive payments from your customers. Of course, features vary based on the software your business uses, but many programs offer recurring invoices and automated payment reminders that help you get paid faster with less work on your end.

Keep Track Of Your Income & Expenses Throughout The Year

For a business owner, there are few things more stressful than shuffling through receipts, invoices, and bank statements to get your finances in order. Not only does waiting until the last minute create more work for you (or your bookkeeper), but rushing through makes it easier to miss errors that can affect everything from your financial statements to filing your taxes. Don’t wait to track your income and expenses. Simplify your year-end accounting by tracking income and expenses throughout the year.

You can track your income and expenses through your accounting software. At a minimum, you should include the date of the payment, the amount of the payment, and the payor or payee. For further organization, you may even break down your income streams and expenses into categories if this is an option in your accounting software.

Like many of the other steps in this article, the benefit of tracking your income and expenses is two-fold: it simplifies your year-end accounting and also allows you (or your accountant) to more easily find tax-deductible expenses.

Reconcile Your Bank Accounts Every Month

Accounting is all about balance, and reconciling your bank accounts can help ensure you maintain that balance. To put it simply, reconciling your accounts means that you compare documentation (such as invoices or bills) to ensure they match the transactions in your bank accounts. Sound difficult? Not to worry — your accounting software can come to your rescue again.

Sure, you could sit down and manually compare your bank statements with your bills, receipts, and invoices … or you could let the software do the work for you. Many programs offer a reconciliation feature that lets you securely connect to your business bank accounts. The information is compared to transactions that have been input into your software. If the numbers don’t match up, you know that there’s an error somewhere in your accounting — maybe you forgot to enter an expense, for example. Bank reconciliation goes beyond just user error; it is also a way to detect bank errors or even fraudulent activity.

Reconciling your bank accounts should be a regular bookkeeping task that your business performs at least once per month. Balancing the books and detecting errors on a regular basis is far easier and less time-consuming than waiting until it’s time to do your year-end accounting. Plus, if you notice an error at the end of the yar, it may be too late to set it right.

Separate All Personal & Business Expenses

In a perfect world, all small business owners would have their personal and business expenses separated by using different bank accounts. Unfortunately, this isn’t the case for all businesses. If you use one bank account for personal and business expenses, those will need to be separated as part of your year-end accounting process.

Why separate your expenses? Two words: IRS audits. If the IRS has reason to believe that you’re writing off personal expenses as part of your business, you could be audited. And if you don’t have your finances in order, you’ll find it more difficult to get through this audit, potentially paying more money due to poor record-keeping.

Fortunately, some accounting software provides easy, hassle-free options for separating your expenses. If you don’t have separate bank accounts, look for a program that offers this feature, such as Wave. You should also consider opening a business bank account for improved organization heading into the new year.

Count Your Inventory At The Beginning Of The Year

While your accounting software may have an inventory tracking feature, you should never skip over manually counting your inventory. By counting your inventory, you can verify that the data in your software is correct. Your inventory at the beginning of the year should match the closing inventory from the previous year.Â Counting your inventory is also a way to calculate the cost of goods sold, and is required for several tax forms.

There may be discrepancies in your accounting software and your manual count. This isn’t uncommon and could be due to a number of reasons, such as broken products or items that were stolen. Identifying these discrepancies keeps your books accurate and prevents interruptions to your business, such as unexpectedly running out of stock.

You may also find that you need to clear out some stock as you head into a new year. Products that are obsolete or aren’t selling, for example, can be sold at a reduced price or even donated, which may qualify as an additional tax deduction. Need more year-end sales advice? Check out our top holiday sales tips.

One thing to note is that your inventory should be counted on a day that your business is closed. Products should not be shipped or sold until the inventory is counted and reconciled in your accounting software to ensure accurate counts.

Run Year-End Reports

Running financial reports is a critical step in year-end accounting. These reports give you a clear picture of how your business is doing financially. These reports are also used when filing your tax return. In addition to showing how your business performed through the year, you can also use these reports to set budgets and goals for the year ahead.

There are a few reports that you should always run at the end of each year. These include:

Profit & Loss Statement: A summary of costs, expenses, and revenues that show whether the business operated at a profit or a loss.
Balance Sheet:Â Summarizes the company’s assets, liabilities, and equity.
Expense Report:Â A report that tracks expenses necessary for business operations, including reimbursable travel expenses of employees.
Mileage Log:Â A report that reflects the beginning and ending mileage on a vehicle used for business purposes.
Payroll Summary:Â Summarizes data for paid employees, including wages, taxes, and deductions.
Sales Tax Summary:Â A summary of the sales tax you have collected, as well as sales tax you have paid toward your expenses.

You may opt to run additional reports to have a more comprehensive view of the financial state of your business, such as a Statement of Cash Flows or Sales By Item. You should also consult with your accountant to find out about other reports that may be required for filing your tax return.

Most accounting software allows you to easily run at least basic reports, such as P&L Statements and Balance Sheets. For more advanced reporting, a software upgrade may be required. Always make sure to check each report for accuracy. Once you’ve confirmed that your reports are accurate, it’s time to analyze your business performance. Did you meet your financial goals? Are there areas for improvement? Use this data to set a budget and financial goals for your business for the year ahead.

Take Care Of Year-End Payroll

As the end of the year approaches, you can tackle year-end payroll tasks. While some tasks are better reserved for the month of December, you can actually get a jump on completing these tasks by starting in October or November.

To get started, first verify that your company information, such as tax ID numbers and mailing address, are accurate. Next, verify the information of your employees and contractors. This includes taxes, wages, Social Security number or Tax ID, filing status, and mailing address. If information is incorrect, an employee or contractor should review and submit an updated W-9 or W-4.

Also make sure that you prepare in advance for payroll periods that fall during the holidays so there isn’t a delay in payments. In December, you can also run payroll for employee bonuses and make any necessary adjustments.

The Payroll Summary that was mentioned in the previous section should be used to verify that all information is correct. Once you’ve confirmed that all employee information and payroll summary data is correct, you can gather the documents you need to send out 1099-MISC forms and/or W-2s in January. If your payroll processor or accountant will be sending out these tax forms, make sure that everything is in order and you have all required documentation in order to have the forms prepared and mailed out prior to the deadline.

Lock Your Closing Periods

Once you’ve completed your year-end accounting, it’s time to lock your closing periods — or close the books. Once you’ve locked your closing periods, you will be unable to add or make changes, so make sure that you’ve completed all of the necessary steps of year-end accounting before closing your books. Many accounting programs allow you to lock closing periods quite easily just by selecting a date.

If you did find that you made an error, all hope isn’t completely lost. Some software, such as QuickBooks Pro, allows you to set a password that can be used to add, remove, or update transactions.

Start Fresh In The New Year

This all may seem a bit overwhelming, but it’s worth it to have a fresh start for the new year. You’ll be ready for tax time, have new goals in mind for your business, and have a better understanding of your company’s current financial situation.

While some of these steps may be time-consuming (I’m looking at you, inventory counting), knowing what needs to be done and tackling tasks throughout the year will save time and help ease the stress that comes with year-end accounting. Good luck!

The post Simplify Your Small Businessâs Year-End Accounting With These 9 Easy Tips appeared first on Merchant Maverick.

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November 14, 2019

Your Step-By-Step Guide To Starting A Successful House Flipping Business

If you’re intrigued by the thought of making money by flipping houses, you aren’t alone. Flip through the TV channels (pun intended), and you’ll see home improvements that lead to a five- or six-figure payday. You may have even received an email promising frozen cocktails on the beach while raking in the dough … all because of house flipping.

What these TV shows and emails don’t tell you is that there is a lot of hard work involved in starting a house flipping business. I know, I know. The idea of a burgeoning bank account without having to do much work is appealing, but it isn’t the reality of the industry. That said, don’t be entirely discouraged — you can build a successful business that centers on flipping houses for a profit. You simply have to be prepared to put in the hard work — just as you would with any other business.

In this guide, we’re going to look at how to start your own house flipping business, step-by-step. While this isn’t a get-rich-quick scheme or even a guarantee of profitability, understanding the industry and what it takes to open and operate your business can increase your chances for success. Whether you’re brand new to house flipping and toying with the idea of becoming an entrepreneur, or you’re ready to hit the ground running, this guide is a must-read before you get started.

Why Start A House Flipping Business?

If you’re reading this, you probably already have at least some idea of what a house flipping business does, but let’s briefly review what this type of business entails. A house flipper buys a property at a low cost. This property could be distressed and in need of repairs, a foreclosure, an older home that needs to be updated, or a house that is located in an up-and-coming neighborhood. Once the home is purchased, it is renovated and resold to another buyer at a higher price.

So, why are people jumping into this industry? One reason that many people choose to flip houses is the potential for profits. If a property is purchased and renovated at a price that’s low enough and resold at a much higher price, you have the potential to pocket thousands of dollars per house. For example, let’s say you purchase a house for $120,000. After putting $20,000 into the house to replace floors, cabinets, counter tops, and make other cosmetic repairs, you are able to resell the house for $150,000. You have only invested $140,000 in the house, so you make $10,000 on this flip. Of course, there are circumstances where a flip doesn’t work out exactly as planned (which we’ll cover a little later), but there is the potential for big profits with a house flipping business.

A house flipping business may also be a great opportunity if you’re somehow already familiar with the industry. Maybe you have experience as a real estate agent or contractor, and you’re familiar with how the business works. You might have even flipped a house or two to make extra cash in the past, but now want to make it a full-time career. If you have experience — whether it’s selling properties or fixing them up — you can put these skills to work for your own house flipping business.

Finally, right now may be the perfect time for you to flip houses. We all remember the housing crisis of 2008, but more than 10 years later, the real estate market is hot again. Housing prices are on the rise, and investors are grabbing up properties to flip. According to Realtor.com, mid-sized cities in the South and Midwest with strong economies, growing populations, and an abundance of older properties in need of rehab are prime markets for flipping. If you live in these areas, house flipping may be the right business opportunity for you.

No matter what your reasoning, you must be prepared to work hard to make your business a success. From finding and securing financing to marketing and reselling your properties, you’ll need to be fully involved every step of the way (at least at first) and be prepared to encounter bumps in the road on your path to building a business.

6 Steps To Starting Your Own House Flipping Business

Whether you’ve already set your mind on flipping houses or you’re still on the fence, it’s important to understand what this business requires to be a success. We’ve outlined six steps to starting your own house flipping business to help you determine if this business is right for you. If so, these tips can help you get you on the right track. Let’s jump right in.

#1 Write Your Business Plan

Every business should have a business plan, and a house flipping business is no exception. A business plan is important for a few reasons. The first is that it acts as a road map for your business. It outlines the purpose of your business, evaluates the industry and your competition, projects profitability, and states the goals of your business.

In addition to outlining your goals and how you’ll achieve them, a business plan is also necessary in most cases to obtain funding. Flipping houses requires capital — capital that you obtain from traditional lenders, investors, or other sources. Your business plan shows that you know what you’re doing, you’re familiar with the industry and your competition, and you have a good chance for success, all of which add up to a lower risk investment for lenders.

There are several ways to write a business plan. A traditional business plan spans several pages and is more complex, containing in-depth analyses of your market and competition, financial projections over the next three to five years, your business strategy, and information about the members of your team. However, more businesses are scaling back on these lengthy documents and opting to create a one-page business plan. A one-page business plan is a condensed version of the traditional plan, offering information such as your objectives, a financial summary, and your industry experience. Learn more about whether a one-page business plan is right for your business.

No matter which plan you choose, there should always be a few things you include about your house flipping business, such as basic timelines, projected budgets, your market, and the types of properties you plan to flip.

#2 Set Up Your Business

Once you’ve written your business plan, it’s time to set up your business. At a minimum, this includes choosing your legal structure, registering your business name, setting up a business bank account, and acquiring any required licenses or permits. Taking these steps allows you to legally operate your business, determines how you pay taxes, and gives you credibility with lenders and investors.

The first step is to choose your legal structure. As a quick summary, a legal structure for a business may take the form of one of the following:

Sole Proprietorship:Â A sole proprietorship is the easiest and cheapest to set up. It does not require registration. Sole proprietors are taxed at the personal tax rate and file business earnings or losses on personal tax returns. This structure does not offer liability protections.
Partnerships:Â A partnership is a structure for a business with two or more owners. Partners are taxed at the personal tax rate and file earnings or losses on personal tax returns. Limited partners have liability protections, whereas general partners do not.
Corporations:Â A corporation is the most expensive to form and has the most requirements, such as annual meetings and a board of directors. Depending on the type of corporation, taxes may have to be filed using the corporate tax rate. Corporations can raise money through the sale of stock. There are also liability protections in place for owners.
Limited Liability Company (LLC): An LLC offers features of several legal structures. There are no requirements, and owners can choose how they are taxed. There are liability protections under an LLC.

This is just a brief summary of each type of legal structure. To learn more and to help determine which is right for you, check out our in-depth guide on choosing your business structure.

Once you’ve determined your legal structure, you’ll need to register your business name with the state in which you’ll operate. Depending on the legal structure you select, additional fees and or paperwork may be required.

Next, you’ll need to find out the types of licenses you need to operate your business. If you’re operating in an office outside of your home, for example, you’ll need a general business license and business insurance. As a house flipper, you’ll also need permits and insurance on each house that you flip, so it’s best to establish a relationship with an insurance agency early in the game. Some house flippers opt to get their real estate license. While this isn’t a requirement for flipping houses, it can certainly help you along the way.

Finally, you’ll need to set up your business bank account. This is necessary for keeping your business and personal finances separate, which especially comes in handy when tax time rolls around. If you seek business funding, this account will also be where your funds are deposited.

#3 Know How To Find & Secure Funding

You’ve taken all the steps of setting up your business and your new bank account. Unfortunately, your new business bank account is probably looking pretty empty … and in most cases, there certainly isn’t enough cash to buy and flip a property. The good news, though, is that this isn’t uncommon for new house flippers — or new business owners in general. It’s rare to find someone with their own cash to start and fund their own business, so that’s why new business owners turn to lenders or investors to get capital they need to start and operate their businesses.

There are a few funding options for flipping houses. The type you select is based on a number of factors, including time in business and your credit history. Not all funding will be right for your business. For example, if you have a low credit score, hard money loans may be an option for you. Hard money lenders base lending on the deal itself — not your personal or business credit or lack thereof — but are usually very short-term and have high fees.

Once you’ve been in business for at least a few months, you may need a flexible funding option to purchase properties, pay for renovations, or cover operating costs. In this situation, you may qualify for a business line of credit. Even if you have a low personal credit score, you may still qualify with lenders that consider the performance of your business over credit history.

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If you own your own home, you could use a home equity loan or home equity line of credit (HELOC) to fund your flips. If you have equity in your home, a low debt-to-income ratio, and a good personal credit score, you could qualify for one of those options, which come with low rates and favorable terms. If you have a retirement account, you could also consider a Rollovers as Business Startups plan (ROBS), which allows you to leverage your retirement funds without penalties.

For unexpected expenses or operational costs, consider applying for a business credit card. You can also get creative by bringing on a business partner or launching a crowdfunding campaign. Whether you’re new to the game, have some experience, or have credit challenges, there are options available to you. You just have to connect with lenders to find them.

No matter what type of funding you seek for your business, there are a few things to keep in mind. First, understand that borrowers with the highest credit scores typically qualify for more options that are also more affordable. So, one of the first things you want to do prior to submitting your application is pull your free credit score, access your credit report, and dispute any errors. You can also take steps to boost your credit score.

Once you apply for funding, make sure that you fully understand the terms, fees, and interest rates associated with your financial product. Don’t be afraid to shop around your options if you aren’t happy with a lender’s offer.

If you do secure funding, make sure to always pay as agreed and meet all conditions put in place by the lender. By doing so, you can not only raise your credit score, but you can also establish lasting relationships with lenders and investors that will serve you well as you build your business.

Unsure of which funding option to choose? Learn more about the best loan products for your house flipping business.

#4 Connect With Contractors & Other Professionals

In addition to lenders, you’ll also need to establish relationships with contractors and other professionals that will help contribute to the success of your business. Even if you plan to get hands-on with the renovation of your properties, you’ll still need a team of contractors to help with the work, particularly when distressed properties are involved. Not only will a contractor complete the work required to flip a house for profit, but a good contractor will know about licenses, permits, and other local requirements. You can also discuss your timelines and budgets with your contractors so you don’t have extended timelines or unnecessary expenses cutting into your profits.

When seeking contractors, don’t be afraid to ask for references or a portfolio. Also, don’t forget to shop around your options to find a reputable contractor that works with your budget. If you’re new to the industry, developing a working relationship with a reputable contractor can even help you score hard money loans from investors.

Another professional that you need on your team is a real estate agent. If you opt not to get your real estate license, a realtor has access to resources that will be essential for your business. This includes access to properties on the multiple listing service (MLS), as well as prospective homeowners that could be interested in purchasing your properties. A realtor can also help market and sell your renovated properties.

Someone else to keep on your speed dial is an attorney, and not just any attorney — one that specializes in real estate. There are some legalities of flipping houses that you don’t want to overlook, so it’s wise to have a real estate attorney on your team. An attorney is especially critical during your first flip. Overlooking important legal details, errors in contracts, and other issues could not only derail your deal but could also damage your reputation in the industry.

Over time, there may be additional professionals you’d like to have in your corner, such as an accountant and investors. For now, though, focus on finding the right contractors, attorneys, and realtors for your house flipping team.

#5 Understand The Importance Of Market Research

Knowing your market is key to maximizing profits as a house flipper. Buying the wrong property in the wrong neighborhood could result in a low profit that’s not worth the time invested in the property, or worse, a loss.

Working with a realtor can really help when it comes to knowing your market. Realtors have the inside scoop on the hottest neighborhoods, information on recently sold properties, and other data that can help you find the right homes for flipping. You can also take advantage of the vast amount of information you can find on the internet, where you can do a lot of your market research for free.

With market research, you’ll soon learn where buyers are buying, how much they’re paying, and what they’re looking for. While there are some variances depending on where you live, there are a few markets that are always hot, including neighborhoods with great schools, neighborhoods with homes that are at least 20 years old, areas with low crime rates, and houses that are close to amenities. Once you understand the market, you can begin further narrowing down the areas you wish to target and begin preparing for the next step: buying and flipping a property!

#6 Buy, Renovate, & Sell Your First Property

You’ve set up your business. You’ve connected with a team of reputable professionals. You’ve found and secured funding, or are at least aware of a few potential options. You know your market, you’ve researched recent selling prices, and there are properties on your radar. Now, it’s time to pick a property, buy it for the right price, renovate it, and then flip it for a profit.

This is where your team will really come in handy. For instance, your realtor may have information on properties before they hit the market, giving you an early edge over other flippers and buyers. Your attorney can help with the paperwork and walk you through the steps of purchasing and flipping a house — think, walk-throughs, insurance requirements, and negotiating contracts.

Once you’ve purchased the property, it’s time to start your renovations. Work through your budget and timeline with your contractors, and put the research you did earlier to good use. Look at comparable properties when determining what renovations need to be completed. For example, if recently sold houses in the same neighborhood have updated granite counter tops, add granite counter tops to your “to-do” list. Finally, be prepared for the unexpected. Deadlines may be missed, or there may be additional expenses that weren’t accounted for in the budget. It happens to even the most experienced flippers — the key is learning to roll with the punches.

After the renovations are complete, it’s time to put your house on the market. Your realtor will be a valuable asset by listing the property and helping you market it to buyers. Then, once a buyer is interested, work with your attorney to make sure all of the i’s are dotted and t’s are crossed. Once the property is sold, any amount that exceeds what you’ve put into the house is pure profit.

Final Thoughts

Let’s make one thing clear: flipping houses isn’t easy, no matter how simple it looks on TV. But if you’re ready to put in the work, you’ll find that house flipping is extremely rewarding. As you flip your first few houses and begin to find your groove, you’ll find that the process gets easier, just as it does with any other business.

You don’t have to go at it completely alone, though. We have a load of great small business resources right here, so check them out and get ready to build your business. Good luck!

The post Your Step-By-Step Guide To Starting A Successful House Flipping Business appeared first on Merchant Maverick.

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November 12, 2019

Giving Tuesday for Small Businesses: Why Your Company Should Get Involved, Plus 5 Fun And Clever Ways You Can Participate

The Tuesday after Thanksgiving in the United States is officially known as Giving Tuesday, a kick-off to a celebration of charitable giving throughout the world. What started in 2012 as a small act of community activism to rebut the holiday season’s abundant consumerism has turned into a global movement of generosity for individuals, small businesses, and corporations. Giving back to your community is one of the most meaningful acts you can do as a small business. If you are looking for a way to capitalize on Giving Tuesdays’ influence and reach, keep on reading to find out how.

What Is Giving Tuesday?

Giving Tuesday is a global social media campaign started by the 92nd Street Y and the United Nations Foundation. The campaign’s goal is to combat the commercialization of the holidays and raise charitable giving to organizations across the world. According to the Giving Tuesday organizers:

When GivingTuesdayÂ launched in the US in 2012, we believed that technology and social media could be used to make generosity go viral; that people fundamentally want to give and to talk about giving; and that the social sector had the capacity to show more innovative leadership, creativity, and collaboration. People and organizations around the world proved us right. In just seven years, GivingTuesday has radically changed how we think about generosity and showed just how much power communities everywhere have to create change.Â

In 2018, Giving Tuesday donations in the United States exceeded $400,000,000 and received over 14.5 billion social media impressions. Each year, the media attention and hashtag activism create a surge of momentum, and the stats show that consumers (Millennials, especially) make purchasing decisions based on a company’s charitable giving.

The concept behind Giving Tuesday is to create a day where our energy and attention focus on how we can help our communities; how you embrace this pseudo-holiday is entirely up to you and your staff. We live in an age where social responsibility matters for your business branding, and it also helps target potential customers who share in your cause. The movement’s website does have a way to search for nonprofits seeking assistance in your area if you’re looking for a place to start. And if you’re wanting to check a charity rating, you can do that through the Better Business Bureau’s Wise Giving Alliance.

When Is Giving Tuesday?

Giving Tuesday is set to take place every Tuesday after the US Thanksgiving holiday. This year, the day falls on December 3, 2019. The celebration of giving lasts twenty-four hours.

5 Fun & Effective Giving Tuesday Ideas For Small Businesses

If you don’t know the best way to incorporate Giving Tuesday into your small business, Merchant Maverick has some tips for you. Here are five fun ideas:

Choose A Nonprofit Through A Contest

Every year, my credit union holds a contest to donate $10,000 to a local nonprofit in the area. Five charitable organizations are plucked from a bevy of nominations, and customers and people on social media vote for the winner. In this particular version of the event, the nonprofit that wins the contest receives the big prize, but all nonprofits receive a small donation regardless. You want your customers to care about the organization you’re backing, so offering the community a chance to nominate their favorite nonprofits is a fantastic and fun way to encourage participation and buy-in. Some companies share their winners on Giving Tuesday, but if that’s too late a start for marketing, you could start the contest on Giving Tuesday and extend it through the holidays.

Have Your Entire Company Donate Time/Resources

Giving Tuesday could be an afterthought to an already hectic holiday season. It shouldn’t be. There are numerous ways your employees can donate time and resources in your small business’s name. Several larger corporations give their employees time off on Giving Tuesday to work/donate their time to a nonprofit of their choice, and other businesses go together as a group to volunteer locally. It’s up to you on how you share the news of your giving, but it’s more meaningful to focus on the impact you and your business can make to the community. Find places that need you, find a nonprofit that merges well with your business style, and ask how you can help.

Give A Portion Of Your Sales To A Nonprofit

This is an oft-used, tried and true method, but it still has an incredible impact for you and for the nonprofit you raise money for: give money from sales or give goods/services. You can hold hourly contests with giveaways for reaching certain sales goals or keep an updated real-time calculator for social media showing what you’ve earned. When consumers know a percentage of money is going to an organization they care about, they will be more likely to spend money with you. Is there a special product you could release where 100% of profits go to a charity of your choice?Â (Think: LUSH Beauty’s Charity Pots or Portland’s Ex Novo Brewery, where 100% of beer sales target specific nonprofits in the area. Portlanders are always down for drinking with a cause.) There are other ways to use this model that do not cut into sales. There is the TOMS Shoes model (you buy shoes, they give a pair of shoes to someone in need), or the Barnes and Noble Buy a Book campaign for local school children. Is there a product people can buy from you for others? Pick a method that works for your company, whether you are brick and mortar or online, and advertise those Giving Tuesday plans.

Get Your Clients/Customers/Employees To Participate In The #UNselfie Campaign

One of the reasons why Giving Tuesday has momentum and staying power is because of its tireless connection to social media campaigns. The hashtag game is strong with #GivingTuesday. One of those important hashtags is the #UNselfie. An unselfie is a picture posted on social media that lists the reasons why someone might give or where someone is giving their time and resources. The pictures usually involve someone holding up a piece of paper over their face listing the best reasons to give and what specifically is important to them. You can ask customers and employees to take an #UNselfie and post it with your company’s hashtag to draw awareness to the day and what your small business is doing. (Maybe hold a random drawing for one customer who posts! Be sure to like and respond to posts, too. Engage with your customers/clients.)

Focus On Storytelling And Go Big On Social Media

I’m a loud and intense proponent of using storytelling to grow your business and help the world. As humans, we are drawn to stories. We want to know who people are, what makes them tick, how we can help. There are many ways to use Giving Tuesday as an opportunity to tell your story or the story of someone who needs help from the community. If you are collecting money for a charitable organization, think about setting certain price-anchors for donations and telling your customers what impact that donation has. (For example, a $10 donation plants a tree; a $100 donation sends a kid in your community to camp.) No matter the organization you choose, it’s up to you to tell that story and get the word out. The more relational your Giving Tuesday campaign is, the more success you’ll have.

3 Ways Your Small Business Can Benefit From Participating In Giving Tuesday

It’s important to note that Giving Tuesday is about giving. Can you benefit from participating? Of course! But the who and the why of this day are far more important than the how. Shoppers are savvier than ever before and they know what they like in a business, and they can also smell inauthenticity from miles away. If your Giving Tuesday campaign is too focused on you and not focused enough on who you’re helping…you’re doing it wrong and it will feel forced and backfire. Getting excited about Giving Tuesday starts at the top and works down, so you set the barometer as a business owner. Still: that doesn’t mean the attention to Giving Tuesday isn’t worth it for your business. Here are 3 ways you benefit from participating:

Improve Employee/Customer Morale:Â Today I cried watching a viral video of a little boy finding an empty candy bowl on Halloween and filling it with his own candy before leaving the house. We are moved by selfless generosity and love for others, and when feel-good stories are short supply, boosting morale is no small task. Work is work and business is business. For business owners and employees alike, taking the time out to do something important and generous will boost mood and overall company self-esteem.
Receive Tax Deductions: Tax deductions are helpful and we cannot ignore that they are a benefit to donations. Check out your state and local requirements for tax deductions on charitable giving and follow all the rules.
Establish Yourself In The Community:Â Your small business is part of a larger community and serving that larger community is a huge benefit to you, your employees, and your customers. Whether it’s getting your name out as a partner or ally, communicating your business values, or setting up a system of giving that extends all year long, Giving Tuesday is the perfect place to start your campaign.

Pay It Forward With Giving Tuesday Campaigns

Doing good for the world and your community is good for business. Shoppers care about their communities, they also care about knowing where their money is going, and they want to shop for a cause. While the Giving Tuesday media ramps up and before the hashtags start to fly, decide on the most practical way to contribute this year and build off that foundation. What has your small business done for Giving Tuesday in the past? Do you have any ideas and success stories to share? Tell us in the comments below.

The post Giving Tuesday for Small Businesses: Why Your Company Should Get Involved, Plus 5 Fun And Clever Ways You Can Participate appeared first on Merchant Maverick.

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November 5, 2019

Types of Digital Marketing: Examples, Uses, and Resources

Saying you’re going to start doing “digital marketing” for your business is like saying you’re going to the “Western Hemisphere” when someone asks where you’re going for vacation. Digital marketing is made up of a bunch of marketing concepts, each with their own strategies and purposes.

And if you’re wondering what types of digital marketing you should be using in your business, a bunch of grab-bag tips and techniques won’t help you until you first understand how digital marketing breaks down and exactly how each marketing concept works.

I’ve put together a guide on the different types of digital marketing with examples, uses, and resources so you can evaluate which digital marketing strategies support your goals.

I’ve broken digital marketing into three media types (owned, earned, and paid) to categorize the different marketing concepts.

Let’s dive in!

Owned Media

Owned media is any media or attention that you own and control.

Your website(s), blog, and social media channels are all examples of owned media.

Marketers use it in contrast to Earned or Paid Media where other people control the attention you receive. Successful owned media means that your audience pays attention to you directly rather than via other websites or ads.

SEO

SEO stands for search engine optimization — it’s all about getting your website to appear when people search for it / you / related content topics. The world of SEO is wide and takes time. So while I won’t tell you it’s the best channel for immediate satisfaction, there are still some amazing results to be had.

For most, a successful SEO campaign would be a huge win due to the sheer volume of traffic that Google organic search can drive. Google processes over 3.5 billion queries per day and most of the clicks go to an organic result.

You’ll learn pretty quickly that in paid advertising, clicks for competitive keywords can be quite expensive. That’s a cost you don’t have to pay if you rank in the organic search results.

SEO breaks down into three categories: technical, off-page, and on-page. Technical and on-page SEO are owned media, and off-page SEO is earned media (more on that in a bit!).

Technical SEO

Technical SEO is all about ensuring that Google/Bing bots can crawl and index your website effectively. It’s about making sure you’re not generating tons of duplicate content. This is really about making sure the technical components of your site are up to snuff (no broken links, no multiple versions of your about page, etc).

Seeing it in action:
Some of the biggest gains in organic traffic can come from good technical SEO. Bad technical SEO creates problems like this –

A huge technical issue with re-launched sites is link redirects. I’ve helped several clients triple their organic traffic simply by redirecting old URLs to new URLs.

If you’ve ever had difficulty searching large retailers on Google for products…it’s because they are terrible at technical SEO (I’m looking at you Gap, Old Navy and Banana Republic…also Nordstrom’s).

Why it’s useful:

I mean… you want Google to be able to evaluate your site, right?! Technical SEO is here to make sure users can find the actual information they’re looking for, and that Google can see all of the great content you’re creating (more on that in a minute).

What’s tough about it:

If you’re using WordPress, a good website builder, or a good hosted ecommerce platform you have the big barriers taken care of.

If you are already using a different platform, a technical audit might be the SEO item worth paying for, especially if you don’t have any technical SEO experience or you are working on a large enterprise scale.

Mentioning a “stand-alone technical audit with recommendations” to an SEO expert can be valuable if you’re on a custom-built site. Just don’t let them sell you on “ranking #1 tomorrow!”

What to Learn:

If you are running WordPress, install WordPress SEO by Yoast and run through my guide for using it effectively.

On-Page SEO

On-page SEO is all about “targeting” the right keywords and ensuring that your website is laid out in a coherent way that is understandable by search engines and users browsing your website. It’s about creating targeted content that helps answer your audience’s questions (either through a blog, a newscenter, or targeted landing pages!).

Seeing it in action:

REI is a master at on-page SEO. Check out what happens when I search “stand up paddle boarding”.

REI has created tons of content around various outdoor sports, and they rank in the top of the search results consistently. So while I may not be ready to buy a stand up paddle board, REI is on my radar from the very beginning because of the educational content they’re giving me.

Why it’s useful:

The goal of on-page SEO is to get specific content to appear on Google when someone is searching for it. It should bring in new people AND support sales (and it shouldn’t be keyword-stuffed content that won’t help customers on your website make a decision).

When done correctly, you can create authoritative content that addresses problems, questions, etc of your market, and when coupled with off-page SEO (more on that in a minute!), you can drive organic (AKA free) traffic to your site and capture your audience in the “research phase”.

It’s a way to build trust and authority with your ideal clients.

What’s tough about it:

It’s a long game for sure. And, if you’re just getting started, you’re already behind the curve. That’s not to say don’t do it (you should absolutely be creating content that addresses the problems your audience has). But you have to be consistent, research the right keywords that you can compete for, and build some trust with Google in order to get your content to appear in the top level of search results.

*Bonus – listen to Nate debate the merits of focusing on on-page SEO over off-page SEO.

What to learn:

How to use keywords on your website
How to do keyword research
Using title tags and meta descriptions
Using Google Search Console
Finding Content Ideas for SEO

Email Marketing

Email marketing has been around for ages. It involves having a list of “subscribers” (people who have opted in to say they want to receive emails from you) and sending them periodic emails with content, promotions, news, etc.

Seeing it in action:

Those promotional emails you get from your favorite retailers? Reminders that your car is due for service? Heck, even promotions from your credit card companies!

Yep… they’re all a part of email marketing. Here’s an email marketing example one of our team members received from Madewell:

Why it’s useful:

You can create highly targeted content with email marketing based on buying behaviors, automation rules, and even site behaviors. Email provides a highly customized experience and helps businesses create a more intimate relationship with their audience.

Why it’s tough:

How many emails do you get a day? Probably hundreds! In fact, if you have a Gmail account, you likely have an entire section of your inbox dedicated to promotional email. It’s a noisy space that can be difficult to breakthrough in, and in order to do it correctly, it requires consistency, strategy, and basic copywriting skills.

What to learn:

How to Write an Email Newsletter
Email Copywriting basics
Avoiding spam trigger words

Social Media

While social media platforms technically own the content on them, you do own your channels to a certain extent. You have complete control over what you post, which makes your profiles on Facebook, LinkedIn, Instagram, Twitter, etc. part of your owned media.

Seeing it in action:

Brands use social media in several different ways. For example, some use it to drive sales, like this men’s apparel brand:

While others, like me, use certain platforms to share content (like on Pinterest).

Why it’s useful:

Social media is, well… social! Building your brand’s presence on certain channels is a great way to connect to your audience on a deeper level and get to know them better. Plus, with the advanced analytics social platforms provide, you get such a detailed picture of who your ideal clients are.

Why it’s tough:

Social media experts make social out to be rocket science. It’s really not. Unless you started a business you know nothing about, you should know where your audience hangs out.

Where people tend to go wrong is when they try to be 100% present on every single social network. Effective social media is about having direct interactions where you build relationships and learn more about your audience.

What to learn:

First, I’d definitely recommend any resources from Buffer. I’ve also written a good bit on social media analytics & content marketing.

But second, I’d recommend focusing & learning a single platform. Don’t expand until you really understand your “wheelhouse”. Every platform has a manual and best practices. Study and practice more than anything else.

Earned Media

Earned media is press, coverage or mentions on other websites that you do not pay for since the story/content is useful enough to the outlet to stand on its own. In other words – you “earn” the placement in the news instead of paying for an advertisement beside the news. Earned media is a big deal not only because you don’t pay for it but also because readers trust it more than overt advertisements.

Off-Page SEO

Off-page SEO is basically just SEO-speak for getting links or “link building”, with the caveat that links are not all considered equal.

Sketchy $5 links are going to harm your site. Quality links placed on a related or well-known website are the primary factor for getting better visibility in Google search results, hence why on-page SEO and off-page SEO work well together.

Create high-quality, educational content, get people to link back to it because it’s actually helpful, build your site authority, show up higher in the search results.

Seeing it in action:

The only real way to see off-page SEO in action is with a backlink profile tool like Ahrefs. Check out my post on Ahrefs for how to explore and understand backlink profiles.

Why it’s useful:

Again, off-page SEO works hand-in-hand with on-page SEO. When you have quality sites linking to your quality content, it raises the overall quality of your site. Google takes that into consideration. If you’re a more trustworthy, authoritative site, you rank higher in the SERPS. If you rank higher in the SERPS, your high-quality content appears above competitors, and you get more of the right people onto your site.

What’s tough about it:

Again, it’s a long game… and it requires consistent outreach. When you’re just starting out, you can’t just write a piece of content and hope for links to come. You’ve got to get them, and you’ve got to get them for quality sites. This means pitching your content, doing outreach, etc. It also means having high-quality content for people to link to.

What to learn:

Broken Link Building
Redirecting Old URLS
How to Use Ahrefs

Public Relations

Unlike paid placements, public relations is where you earn publicity for your brand, either through features, news stories, press coverage, social shoutouts, and more. It’s all about working with the media to get the word about your business out there.

I’ve broken public relations down into two categories: traditional media relations and viral marketing.

Traditional Media Relations

This is probably what most people think of when they think of PR. It’s pitching your content to media outlets + trying to get coverage. Keep in mind this isn’t about pitching your business. Focus on being a reliable source & providing good stories / content (In fact, media relations works hand-in-hand with your on-page SEO strategy. Create good content, pitch it to outlets that may find it useful).

Seeing it in action:

Anytime you see a news story about a company or organization…it was probably via a press release or press outreach. PR is everywhere. Here’s an example from a campaign I did for this website.

Why it’s useful:

Having reputable outlets link back to your website or even run your content not only grows your website traffic — it builds brand authority. When you’re trying to stand out in a crowded space (i.e. the Internet), having coverage from reputable sources helps build trust with your audience quicker.

Why it’s tough:

Pitching to the media isn’t a walk in the park. Most outlets get tons of pitches every single day — which means yours needs to stand out and provide actual value. It can be a time-consuming process.

What to learn:

How to Plan a DIY PR Campaign

Viral Marketing

Viral marketing is when a piece of your content goes “viral” — AKA it gets a massive amount of shares and attention in a short period of time. Viral marketing is tough to do, but when it is done, it can create massive traction for your brand.

Seeing it in action:

There are plenty of big corporate campaigns that spark outrage, curiosity or some other big emotion. The original “small business” viral marketing effort was Blendtec’s “Will It Blend” series of videos.

Why it’s useful:

When your content goes viral, you can see a huge spike in traffic over a short period of time. You get more eyes on your site, get in front of larger audiences, and get in front of new audiences you likely haven’t seen before. If it’s high-quality content, you’ll also likely get links back to the viral piece, which can build your site’s authority with Google.

Why it’s tough:

You can try your best to guess what goes into creating viral content, but you’re also at the mercy of the Internet. There’s not an exact science to viral marketing, which makes it hard to pull off.

What to learn:

A big part of viral marketing is tapping into trending topics or trending emotions. The rest is not really a secret. It’s just combining those and hitting the right moment.

Paid Media

Paid media is any media or attention that you pay for. Paid media is a great way to promote your website and get the ball rolling on your business. Usually any type of media business will offer businesses attention for a price. The trick is choosing the right media and getting a positive return from it.

I’ve broken paid media into three categories: search ads, display ads, and social media ads.

Search Ads

Search Ads show up when someone searches for a query. For example, if you search “shoes” – you’ll get ads for shoes. Google was the first mover here and made their billions with search ads. But now many networks from Pinterest to Twitter to Amazon and more all use search ads within their networks.

Seeing it in action:

Search ads are anywhere — just try searching for something on Google! I searched “dentist in Atlanta” and got this…

Again, these ads show up whenever you’re searching for a specific query on search platforms (i.e. Google).

Why it’s useful:

The key benefit of search ads is that the searcher has intent — i.e. they’re actively looking for what you have to offer (like a dentist in Atlanta). The marketing jargon here is that you are “harvesting” demand rather than generating demand.

Why it’s tough:

You’re paying to play, and volume and bid prices can affect your performance significantly, especially if you have budget limitations. If you’re bidding on a competitive keyword, it’s going to cost you. You’ve also got to compete with others who are bidding on high search volume, competitive keywords.

What to learn:

How Google Decides What You Pay
Alternative PPC Networks

Display Ads

Display ads (AKA Banner ads) have been around since the dawn of the Internet. They’re everywhere both the Internet + within platforms (think about the banners that pop-up when you’re using an app on your smartphone).

Display ads differ from Search Ads in two main ways. First, they use images / banners. Second, they focus on interest rather than intent.

Seeing it in action:

Display ads are EVERYWHERE. Just log into Facebook and look on the left side of your newsfeed.

With the data Facebook provides to its advertisers, they can show me ads based on what they think my interests are.

Why it’s useful:

Displays Ads are different from Search ads because you’re targeting interest rather than intent. In our example above, I’m getting targeted with ads for software that helps small businesses, because Facebook knows I’m a small business… so they’re betting I’m interested in software that can help me manage my business.

And while Google handles most Display Ads around the Web, the big opportunity for Display Ads is on “walled gardens” like Facebook, Reddit, Pinterest, LinkedIn, Zillow, etc who all know everything about users on their network.

There are also a range of targeting options, match types, and formats depending on network and goal.

Why it’s tough:

If you don’t know a ton about your audience (or don’t have access to that data), you’re taking a shot in the dark. Targeting interests can be way broader than targeting intent, which means your chances of getting highly qualified leads are less than what they are with search.

What to learn:

Like social media, it pays to learn a single network. Read their manual, learn how to read analytics, and run lots of test campaigns before “scaling up” your spending.

Social Ads

Social ads are exactly what they sound like… ads on social media platforms! Facebook, Reddit, LinkedIn, Pinterest, Twitter, Snapchat, etc… they all have advertising capabilities that allow advertisers to run paid promotions on their platforms.

Seeing it in action:

Check out this ad from UNTUCKit on Pinterest:

One of our staff members uses Pinterest primarily for fashion, so her Pinterest feed includes ads based on her interest in fashion!

Why it’s useful:

Social networks have a ton of data on their users, which gives advertisers a huge opportunity to create very targeted ads based on their users interest. There’s also massive opportunities to retarget users who visit your site and bring them back to your platform.

Why it’s tough:

You’re not just learning one ad platform… you’re learning several. Each social media advertising network operates differently, has different policies, and is constantly changing. It can be easy to spread yourself, and your budget, too thin. The trick is to focus where your users are most active and you have the most data so you can get the most bang for your buck.

What to learn:

Advertising on Reddit
Advertising on LinkedIn
Advertising on Snapchat
Advertising on Pinterest
Advertising on Quora

Next Steps

As you can see, digital marketing is made of up so many different avenues and methods. It’s easy to get overwhelmed and feel like you have to master them all, but you really don’t.

If you’re just starting out and don’t want to spend a dime, I recommend checking out my guide on How to Promote Your Website Online for Free next.

If you’re ready to spend a little and want a step-by-step process to advertising online now that you know the different digital marketing methods, check out this guide here.

The post Types of Digital Marketing: Examples, Uses, and Resources appeared first on ShivarWeb.

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October 19, 2019

The 6 Best Ways To Get A Fix And Flip Loan For Your House Flipping Business

We’ve all seen the reality TV shows for flipping houses. Someone buys a fixer-upper, completely transforms the house in no time at all, and then flips it for a hefty profit. The reality of fixing and flipping homes isn’t quite so simple. But don’t be fooled — house flipping can be a lucrative venture, although it can take more time, work, and money than what the home improvement shows disclose.

Whether you’re looking to make a little money on the side or you want to start a full-fledged business to replace your traditional 9-to-5, there’s one thing all house flippers have in common: the need for capital. Most people don’t have the funds to flip a home, but the good news is that you don’t have to have a loaded bank account to get started. There are multiple loan options available to you, whether you’re new to the game or a more experienced real estate investor.

In this post, we’re going to take a look at the best loans for flipping houses. These funds can be used to purchase investment properties and fund renovations so you can resell the home for a profit. You’ll learn how to qualify for these loans, why they’re a great idea for house flipping, and the potential drawbacks before you sign your loan paperwork.

Hard Money Loans

Contrary to what the name suggests, a hard money loan isn’t hard to get at all. In fact, it’s one of the easiest loans to secure for purchasing investment properties. However, that convenience comes at a price — something we’ll go into more detail about in a minute.

A hard money loan is private funding obtained from investors or individuals. Unlike financing with a traditional lender such as a bank, your credit score and income aren’t necessarily a requirement for qualifying. Instead, a hard money loan is secured with an asset. With a house flipping business, the property you’re fixing would serve as your collateral and could be seized if you don’t pay your loan as agreed. Funds from hard money loans can also be received quickly — in just days or weeks compared to months with other funders — which may be necessary if you have to move fast to snap up a great deal.

Hard money loans are a good option — and in some cases, the only option — for borrowers with poor credit scores, low income, or other barriers that would prevent them from qualifying for traditional loans. Because the property and its potential resale value are most important to the lender, hard money loans are best for experienced flippers that have fixed and flipped at least one property. However, if you’re a new business owner, you may still qualify, particularly if you are working with a contractor to improve the property.

While qualifying for a hard money loan is easy, there are, of course, a few drawbacks. The first is that hard money loans are short-term loans. Typical repayment terms are 1 to 5 years. As with other forms of short-term funding, hard money loans also have high interest rates when compared to more traditional types of financing, typically in the double digits. The goal, then, is to purchase the property, renovate, and sell it as quickly as possible.

Home Equity Loans & HELOCS

You can also use your own assets — your personal residence — to fund your fix-and-flip venture. How? With a home equity loan or home equity line of credit (HELOC). If you have equity in your home and meet other requirements, you may qualify. Here’s how it works.

As you pay down the mortgage on your home, you build up equity — in other words, this is the difference between the value of the home and what you owe on your mortgage. Rising property values may also contribute to equity. Let’s look at an example. If your home is appraised at $500,000 and you owe $200,000 on your mortgage, there is $300,000 in equity in your home. This equity can be used to secure a home equity loan or line of credit that can be used for any purpose, including the purchase of an investment property.

A home equity loan, which is also known as a second mortgage, provides you with a lump sum that is repaid over a long period of time. A HELOCÂ allows you to draw from a set line of credit multiple times until you enter the repayment period. A home equity loan is the better choice if you know how much money you need to purchase and fix up your property. A HELOC is the best option if you need more flexibility with your funding.

To qualify for a home equity loan or HELOC, a bank or other lender will look at the amount of equity in your home. The lender then uses a loan-to-value ratio to determine how much you can borrow. In addition to owning a home with equity, qualifying borrowers must have a low debt-to-income ratio and a solid personal credit score. You do not have to have prior house flipping experience to qualify.

Home equity loans and HELOCs have low interest rates and long repayment terms, making it more affordable for borrowers to get the funds they need. The downside, however, is that approval and funding of the loan may take a long time, so it’s not ideal for deals that will move quickly. You also put your personal home at risk if you default on payments.

Business Lines Of Credit

If you like the idea of a flexible line of credit but don’t want to put your home on the line, you could fund your business activities with a business line of credit. With a business line of credit, you’ll be approved for a set credit limit. You will be able to make multiple draws against this line of credit up to this limit. If you have a revolving line of credit, you’ll be able to continuously access funds as you pay down your balance.

If the line of credit is unsecured, you won’t have to put up specific collateral, although the lender may put a UCC blanket lien against your business assets or require you to sign a personal guarantee.

A business line of credit is great for fix and flips because of the flexibility offered. If, for example, a renovation goes over budget, you can access additional funds, provided you haven’t already hit your credit limit.

Lenders use information about your business to determine if you qualify for a line of credit, as well as your credit limit. At a minimum, lenders will evaluate your time in business and revenue for at least the last three months. Other lenders may have annual revenue, personal credit, and business credit requirements. Since you will need to show some business revenue and at least a few months of operations, this isn’t ideal for brand new businesses or businesses that haven’t yet made any money.

There are quite a few reasons why you should consider applying for a business line of credit for your fix and flip business. There are few restrictions on how most lines of credit are used, so you can put funds toward purchasing and renovating a property. Also, there are many lenders that don’t take personal or business credit history into account, so this could be a funding option for anyone with a low personal credit score or a lack of business credit.

Of course, like all other forms of funding, lines of credit have their drawbacks. In order to receive the best rates and terms, there are higher borrower qualifications that you might not meet. Lines of credit with minimal requirements may have high interest rates, shorter repayment terms, and additional fees. You might also find yourself limited by your assigned credit limit and be unable to fully fund your renovation.

Rollovers As Business Startups

If you want an alternative to traditional funding, you may be able to put your 401(k) or another retirement plan to work for you through a rollover as business startup (ROBS). Normally, early withdrawal of your retirement funds means that you’ll have to pay taxes and other penalties. However, a ROBS allows you to bypass these penalties and use your retirement funds for your business.

Here’s how it works. A new C-corporation is set up, along with a new retirement plan. Funds from your existing plan are rolled over into the new plan. Funds are now used to purchase stock in the new C-corp. Then, the proceeds from the sale of stock can be used for any business purpose, including funding your fix and flip business.

One of the biggest benefits of a ROBS plan is that you are not borrowing from a lender, so you don’t have to worry about interest rates, closing costs, and other fees. However, many people opt to have their ROBS plan set up and managed by a ROBS provider, which requires a setup fee and monthly maintenance costs. A ROBS provider can get everything set up legally, while also ensuring you maintain compliance.

With a ROB plan, you don’t have to worry about factors like income, time in business, personal credit history, and a business credit profile. You do, however, have to worry about one major drawback: potentially losing your retirement funds if your fix and flip business fails.

Personal Loans

If you’re just starting your business, you’ll find that qualifying for business loans is challenging — if not impossible — for new businesses. This is because newly launched businesses are unable to meet requirements such as a business credit profile and annual revenues. If you don’t qualify for a business loan, why not use your personal information to qualify for a personal loan for business?

A personal loan is a loan that is taken out in your name, not the name of your business. With a personal loan, your business experience (or lack thereof) isn’t a factor for approval. You’ll use your income and your personal credit profile to qualify. Once approved, you’ll receive a lump sum that can be used for business expenses. There are multiple avenues you can take to receive a personal loan for business, from your bank or credit union to online lenders.

Personal loans can have very favorable rates and terms, resulting in a lower overall cost of borrowing. However, the best rates are reserved for borrowers with low debt-to-income ratios and a solid credit history. If you have personal credit challenges, you may qualify with some alternative lenders. However, you may have higher interest rates and shorter repayment terms, or be required to put up collateral to secure the loan.

Traditional Mortgage

If you’re more experienced in flipping houses, you may qualify for a traditional loan or mortgage from a bank, credit union, or other financial institution. These work just like the mortgage of your primary home: the lender gives you money, you make the purchase, and then you repay the loan over a longer amount of time — typically 15 to 30 years.

The good news with these loans is that interest rates are very low. However, qualifying can be difficult. To qualify for a mortgage, you’ll have to show previous experience in flipping houses, meet credit guidelines, and fulfill other requirements. Not all lenders will offer loans or mortgages for properties that aren’t occupied by the owner. Others won’t lend on homes that are in extreme disrepair. Because of its long repayment terms, going the traditional route is often a good idea if you plan to fix up a property and rent it out (or “buy and hold” as it is known in the industry) instead of immediately selling once renovations are complete.

How To Improve Your Chances Of Being Approved For A Fix & Flip Loan

While there’s never a guarantee that you’ll get approved for a loan for your fix and flip business, there are a few steps you can take to improve your odds. The lending process can also be lengthy, especially if you don’t understand the application process. Know what to expect and be prepared by taking the following steps.

Have A Business Plan

Lenders want to work with low-risk businesses that have a greater chance of success. After all, if a business fails, it is more likely to default on the loan. You want to show your lender that you are serious about your house flipping business and that each property is worth the investment. Your business plan should include information about your business such as your industry experience, your objectives, and a financial summary. Learn more about writing your business plan.

Each time you plan to rehab a property, an analysis of that property should be included in your business plan. We’ll discuss what you should include in this analysis in just a minute. Taking the time to analyze each property also is critical for getting the right amount of money from your lender.

Have A Property In Mind & A Plan Of Action

In order to be able to analyze a property and present this information to a lender in your business plan, you must first have a property in mind. Once you’ve found a property, you need to create a plan of action, from what contractors you’re going to use to how much the property will be worth once it’s rehabbed. This not only gives you a better understanding of the costs and timeline of your renovation, but this plan of action should also be included in your business plan.

What should your plan include? At a minimum, address the following points:

Sale prices of comparable homes
Neighborhood analysis
Financial projections for the renovation
Timeline from acquisition to flipping the property
Information about who will be involved in the rehab, such as business partners and contractors
Appraisal of the property in its current state
Estimated value of the property post-renovations

If you’re new to fixing and flipping homes, it’s wise to work with someone that is familiar with the industry. This could mean taking on an experienced business partner, working with contractors that specialize in renovations, or talking to real estate investors. These individuals can share their expertise, which can help you have a better understanding of the business and create an effective and realistic plan of action.

Understand The Costs Of Flipping The House

When it comes to flipping houses, one area that commonly trips up newbies is estimating the costs associated with acquiring and renovating a home. It is very easy to underestimate the costs of fixing and flipping a home. If this occurs, you risk not borrowing enough money from your lender, which could significantly delay your project.

Experienced flippers know that creating a detailed scope of work is imperative to fully understand the costs associated with flipping a property. You can work with a contractor and an appraiser to get a more accurate picture of costs. Some costs to consider include but are not limited to:

Down payment
Purchase price of the property
Closing costs
Building materials
Appliances
Labor: Electricians, plumbers, landscapers, painters & general contractors
Permits

The cost of your renovation will vary widely based on the amount of work that needs to be done. For example, a home that only needs a few cosmetic fixes (upgraded countertops, paint, or new flooring) may have very few associated costs to get it ready for the next buyer. On the other hand, a home that needs structural work, a new roof or HVAC unit, or an additional room may have significantly higher costs.

In addition to the cost of buying and renovating the property, you have to consider other expenses such as property taxes, property insurance, real estate agent fees, and marketing costs to sell the property.

Even with careful planning, you should always expect the unexpected. Unforeseen issues can arise during the renovation process that can increase your costs and add to your timeline. But the more details you include in your scope of work, the more accurate your calculations will be.

Improve Your Credit

Most people don’t have the perfect credit score, so there’s always room for improvement. Cleaning up your credit and taking steps to boost your score not only increases your chance for approval, but also opens up more funding options and helps you qualify for the best rates and terms.

While there is no overnight fix for raising your credit score, there are some steps you can take that can raise your score by several points or more over a few weeks or months. This includes accessing your free credit score, disputing any errors on your report, paying down (or paying off) debts, and keep your balances low. Always make your minimum payments on time (and pay more, if you can) to lower debt and help increase your score. Learn more about how you can raise your credit score before applying for a loan.

Think outside the box

Sometimes, even the most carefully laid plans fall through. For example, maybe the funding you had in place suddenly fell through and now you’re back to square one. It happens to even the most experienced entrepreneurs. The key is to not let it slow you down and to think outside of the box. If you’re having trouble securing funding through traditional lenders or face high interest rates and less-than-stellar terms, consider other financing options. This could include using a real estate crowdfunding platform, taking on a business partner with capital to invest, or tapping a friend or family member for a loan.

Fix & Flip Business Loan FAQs

What type of expenses will fix and flip loans cover?Â

You can get a loan to cover nearly any expense for your fix and flip business. Funding methods like ROBS and home equity loans have few — if any — restrictions on how they are used. Funds from your loan can typically be used to cover a down payment, pay fees and insurance, purchase the property, and fund rehab costs. However, it’s always important to check with all potential lenders to find out about any restrictions on how funds are used.

What is the best fix and flip loan for a beginner?

If you’re a beginner, there are a few funding options to consider for your first fix-and-flip property. Using your own money through a ROBS is one option that has several benefits, such as no credit check or high interest rates. If you have a good credit score and equity in your property, you might also consider a home equity loan or line of credit. All of these options do not have time in business, business credit score, or annual revenue requirements.

Hard money loans may also be an option, but due to higher interest rate, you should explore other alternatives first. While many hard money lenders require you to have some experience fixing and flipping properties, you may still qualify provided you have a solid business plan and connections with experienced contractors or business partners.

Can I get a fix and flip loan without putting money down?

When you apply for a fix and flip loan, lenders typically look at two numbers: the loan-to-value ratio (LTV) and the after-repair value (ARV). The LTV is the size of the loan compared to the value of the property. Most lenders cap their maximum LTVS at 90%, while others may have higher or lower requirements. For example, if you’re purchasing a property that costs $200,000 and will borrow from a lender with a maximum LTV of 90%, the lender will fund $180,000. You will be required to pay $20,000 as the down payment of the home.

Other lenders calculate how much you can borrow based on the ARV of the property. This is the estimated value of the property after it has been renovated. Using the same example as above, let’s assume that the ARV of the property is $300,000. In this example, let’s say the lender will loan a maximum of 80% of the ARV. This means that you can borrow up to $240,000.

With many loans, you may be required to make a down payment. However, some hard money and private lenders may fully fund your real estate deal with no money down. You may also consider other more advanced methods of flipping properties, such as wholesaling — putting a property under contract and then selling that contract to another buyer. Before you dive into these different loans and methods, consider speaking with an experienced real estate investor and fully researching your options.

Can I get a fix and flip loan without a credit check?

It is possible to get a fix and flip loan without a credit check by working with a hard money lender — an individual or investment group that bases its loan approvals on the value of the property and not your credit score. The good news is that personal credit isn’t a factor for approval, so if you have bad credit or a lack of credit history, you may be approved based on the property you’re interested in renovating. On the flip side, though, hard money loans are notorious for high interest rates. These are short-term loans, which means that you’ll have to purchase, renovate, and sell the property quickly.

You may also qualify for a business line of credit if you have an established business. Some lenders will look at performance metrics such as your time in business and annual revenues to determine if you qualify. As with hard money loans, you may face higher interest rates, additional fees, and shorter repayment terms if you go this route.

If you have a retirement account, you can set up a ROBS to use your own funds for your real estate purchase. The only requirement is to have a qualifying retirement account with a minimum amount of funds — no credit check required.

Final Thoughts

Operating a fix and flip business certainly isn’t like what you see on “reality” TV. The reality is that it takes time, hard work, and capital to flip houses. However, when it’s done right — and you find the right funding for your situation — flipping houses can be a very lucrative and rewarding venture. As with any type of loan, make sure you do your research, understand the challenges ahead of you, and make the best decision based on your business goals. Good luck!

The post The 6 Best Ways To Get A Fix And Flip Loan For Your House Flipping Business appeared first on Merchant Maverick.

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5 Types Of Pricing Strategies You Can Use

Cost-Plus

Loss Leader

Skim Pricing

Market-Oriented Pricing

Anchored Pricing

4 Major Considerations For Setting Prices

Know Your Customer

Know The Competition

Have A Financial Target

Know Your Worth

How A Good eCommerce Platform Or Point Of Sale System Can Help You Track Costs & Profitability

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The Bottom Line: Pricing Your Products Is Key To Building A Sustainable, Profitable Business

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2. Accept Donations In Person

3. Take Donations And Orders Over The Phone

4. Recurring Donations

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7. Track Your Income And Improve Your Bookkeeping

8. Collect Donor Information And Engage

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10 Kinds Of Products You Can Sell At A Farmersâ Market

Produce

Milk, Meat & Eggs

Baked Goods

Flowers, Plants & Seedlings

Honey

Soap & Skincare Products

Beverages

Prepared Foods

Arts & Crafts

Other Unique Goods

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How To Complete Year-End Payroll

Step 1: Verify All Employee & Company Information

Step 2: Verify Wages, Taxes, & Benefits

Step 3: Order Your W-2s

Step 4: Manage Paid Time-Off

Step 5: Decide On Bonuses

Step 6: Update Your Compliance Posters

Step 7: Update Payroll Information

Step 8: Deliver W-2s/1099s To Employees

Step 9: File Your W-2s/1099s

Step 10: File Tax Forms 941, Form 940, and Form 944

Payroll Year End FAQS

Get Started With Our Year-End Payroll Checklist

How To Find Grants For Your Nonprofit

7 Places To Look For For Nonprofit Grants

1) Grants.gov

2) Local Resources

3) Candid

4) Grant Gopher

5) GrantWatch

6) Google

7) Your Board Members

Final Thoughts

Use Accounting Software

Regularly Invoice Customers

Keep Track Of Your Income & Expenses Throughout The Year

Reconcile Your Bank Accounts Every Month

Separate All Personal & Business Expenses

Count Your Inventory At The Beginning Of The Year

Run Year-End Reports

Take Care Of Year-End Payroll

Lock Your Closing Periods

Start Fresh In The New Year

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