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Starting an Online Business When You’re in Debt

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By Julian Hills

So you want to start an online business?

Startups have a positive effect on the economy. A recent article from the Consumer Financial Protection Bureau found that each new startup added about 5.3 new jobs over the past decade.

That’s a good thing, but financial fears may be putting a drag on that statistic.

In the period between 2007 and 2010 — the height of the recession — the number of startups fell by 23 percent. The economic climate caused many would-be entrepreneurs in the technology sector to defer their dreams, specifically because of rising student loan debt. Student loan borrowers have lower credit scores than peers with no student debt.

That’s not such a good thing.

Knowing how to manage your resources and using a little creativity could be the key of starting a business while mired in debt.

  • Choose Your Startup Wisely: Select a business that does not require a lot of startup capital. Use equipment, software and supplies you already have. Avoid spending money on new business investments as much as possible.
  • Manage Student Loan Debt: If most of your debt is from student loans you should see if you can lower your payments. Young business owners can often lower their federal loan payments by Income-Based Repayment (IBR.) More information about IBR is available at the U.S. Department of Education’s National Student Loan Data System (NSLDS) website at www.nslds.ed.gov.

Private loan borrowers can see if refinancing at a lower interest rate is an option.

  • Use Free Resources: Go to the library and use their media and business resources. There is also free online software, blog sites and other services that you can take advantage of, and cost you nothing.
  • Find Investors, not Banks: If your business plan is good enough, you may not have to go to banks for investors. There are grants, community programs that help people with limited resources. Crowdfunding is becoming more popular. That involves getting regular people to invest in your company through social networking sites.

The Small Business Association has an entrepreneurial help program called Startup America. It’s a partnership between the public and private sectors aimed at expanding access to startup capital, increasing education, encouraging collaboration between big companies and startups and reducing red-tape. Find out more about the program at their website: http://www.sba.gov/startupamerica.

  • Find Cheap Ways to Market Yourself: Getting out the word about your business is important. You can get business cards printed at relatively inexpensive cost. Using social media, blogging and email to market your startup is free.
  • Don’t Pile on More Debt: The temptation to use credit cards (if you have them) or trying to get more loans or lines of credit is going to be there. It might be wise to raise money by considering selling things you can live without online or at a good old-fashioned yard sale.

Sometimes it takes loads of money to start a business, other times it may just take a laptop. Figuring out what you need or don’t need can trump what you see as limitations caused by debt.

Author’s Bio: Julian Hills is a content writer and blogger for Debt.org. His journalism career has taken him from newspapers to local television news stations and even a 24-hour cable network in the Southeast. Julian is a graduate of Florida State University who enjoys finding new ways of saving money for football season tickets.
Sources:
http://www.consumerfinance.gov/blog/starting-a-small-business-when-you-have-student-debt/
http://smallbusiness.chron.com/start-business-one-debt-2061.html

When’s the Right Time to Expand Your Small Business?

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By Ben Thomas

Your first few steady customers are finally paying all your bills – and as celebration-worthy as that is, it also raises new questions in need of executive answers. Where are the next few customers or clients going to come from? What’s a reasonable advertising budget – and how much is too much? How will hiring a new employee (or three) or renting some new space impact your rate of expansion?

Questions like these can make your small business’s first expansion feel at least as stressful as your initial launch – but a little intuitive knowledge of your expansion’s objectives, boundaries and processes can reduce even the most complex decisions down to simple “yes” or “no” analyses. Here, three small-business experts share the analytical strategies that have become second nature to them as they’ve progressed through their own business expansions.

Flow like water

There’s an old saying that water is stronger than rock, because water never cracks – it just reshapes itself to fit whatever surroundings it’s in. The exact same principle holds true in business: The more your expansions – and shrinkages, if and when those come – all follow naturally from the size and shape of your market, the less likely you’ll be to overextend yourself and fragment your team.

In other words, the clearest signs that it’s time to expand are those that make it harder and harder not to: When you’ve got so many customers that sales are slowing you down; when products are selling out too quickly for your space to hold onto stock; when you find yourself giving a lot of referrals for a service you could be providing – and so on. In cases like these, there’s probably no reason to delay an expansion, even if it feels a little intimidating.

“When we started, we only had a small space and we only had one room,” says Donna Alexander, founder and president of Anger Room. “But we started getting so much publicity, and so many customers coming in, that we actually had to start turning people away. And that was like a big neon sign: ‘OK, it’s time to get a bigger space.’”

By the same token, the clearest signs that you’ve overextended your business are those that feel like hitting some kind of wall: When the money you’re pouring into new ads and/or spaces isn’t correlating with any return; when training a new employee is slowing down sales; when you find yourself starting to give referrals simply because you can’t handle the volume – and so on. Although these signs don’t necessarily mean that you can’t expand, they do point to the fact that you’ve got some bugs that need to be worked out.

Scan for indicators

Even if you’re not drowning in customers, your interactions with the customers you do have can serve as strong indicators about whether it’s time for an expansion – and if so, what direction that expansion should take.

“You’ve got to listen to your market, because with every sale – or lack of a sale – those people are telling you what you do for them, and if you could be doing more, or doing something differently,” says Carolyn Andrews, a certified business and executive coach with Actioncoach. “One of the most important things about timing your expansion is looking at how your market perceives you.”

It doesn’t take a market research firm to find out how your customers feel – it just takes some mutually honest conversations.

Those conversations will come in handy as you analyze the shape your sales are taking, and the reasons why. Which products or services are you selling more or less of than usual? What changes in your market could account for those shifts in sales? What’s your competition doing in response? Does their response leave a new vacuum into which you can expand? “Having a really solid handle on what’s happening in your market is crucial,” Andrews says, “and it’s so much easier to get personal insight into your market’s behavior when you listen to what customers are saying to you.”

Andrews advises looking for “green lights” on all three indicators – positive customer conversations, promising sales analysis and under-adaptive competitor behavior – before you make the leap into your expansion. “When you analyze your potential for expansion in terms of those three indicators,” she says, “you end up with one simple answer: a ‘yes’ or a ‘no.’”

Jump straight in

Leaping into your expansion isn’t just a figure of speech – the only way to be sure your expansion will succeed is to throw everything you’ve got (yourself included) into it.

“In the end, there’s no such thing as a perfect time to expand,” says Stacy Deprey-Purper, founder and CEO of Better Business Together. “But you and your staff still have to jump in with a ‘whatever-it-takes’ attitude, because that’s where your reputation, your customer need and your buzz ultimately come from.”

Still, jumping in doesn’t mean jumping blind. So take as much time as you can afford and draw up a clear plan for your expansion, including employee roles, steps of the expansion, timing projections and so on. “I say that everybody needs a plan… so they can deviate from it,” Deprey-Purper says. “You don’t need a detailed long-term plan, but you need to have some idea of what you’ll be spending and where it’s going to go. I had a client the other day who spent $50,000 on decorations for his restaurant, which ate up 99 percent of his marketing budget.” In short, check that your plan makes sense as a whole before you start throwing money at specific parts of it.

A trusted group of advisers can help on that front – and that can mean a business coach, other successful entrepreneurs, consumers in your market or even a lawyer. “We were once approached by a group of investors who seemed very kind and polite in person, but who actually wanted to take over our company,” Alexander recalls. “When we sat down to sign the paperwork, they suddenly told us, ‘We want 90 percent of the company, and you’ll get the other 10.’ Luckily we’d hired a lawyer to look over the papers for us.” It’s situations like this that demonstrate why it’s vital to have some professional second-guessers in your corner.

At the same time, though, it’s important to keep in mind that you’re the boss, and that the decision depends on your instincts in the end. “If you’ve got too much thinking and not enough doing,” Deprey-Purper says, “you can overthink yourself out of taking action. No matter how much planning you do, you’ll always get some curveballs – and you have to take those as opportunities to learn about your business and plow forward.”

Author’s Bio: Ben Thomas writes about careers in marketing, among other business career fields, for The Riley Guide.

Plagiarism: How to Cope with Every Writer’s Worst Nightmare

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By Tiffany Matthews

Do you remember the first story you wrote? Throughout high school and college, I have often written short stories and poems for friends just for fun. Although these tales and poetry have accumulated over years, they remain as they are–scribblings in notebooks that have now gathered dust at the bottom of my drawer. Some of my friends think that it’s a waste, arguing that these stories should be shared with the world. In fact, they have suggested that I try my luck writing for sites like fictionpress.com. Many writers have gotten their lucky break from this site, signing authorship deals that have made their publishing dream a reality.

In the beginning, you might feel content enough to keep your writings private. But as time passes, you will feel this need to share these tales with others, hoping that they will touch others the way they have touched you. I, too, have felt this need for sharing stories but one worry has always held me back from posting them online–plagiarism.

Everyone is Vulnerable…

All writers are vulnerable to plagiarism. Although self-published authors may be more vulnerable, still, it doesn’t mean that those who publish with reputable publishers are safe from this. In fact, just recently, author Lorelei James’ work was plagiarized. Apparently, someone took All Jacked Up, a title from James’ Rough Riders series, and posted that book chapter per chapter on a free stories website. Everything was exactly the same save for the hero and heroine’s names.

So how can we protect ourselves from this?

Precautionary Measures

Plagiarism has been going on for a long time and this problem is not going to disappear overnight. For any writer who becomes a victim of this, it is one of the worst things that can ever happen to you. Those who love their craft know just how devastating it is for someone to steal their work and pass it off as his or her own. It is almost akin to losing a child. To protect the work of our hands and heart, it is necessary that we implement precautionary measures.

Copyright and Google

Since we know that plagiarism can happen at any given time, one of the things we can do is to register for a copyright. It will not stop a person from plagiarizing your works, but at least you will have sufficient ground for legal action. Copyright registration may vary from country to country so do some research before you do. If circumstances lead you to file to a lawsuit, you don’t need to worry about expensive lawyer fees. You can use prepaid legal plans, which can have budget friendly monthly subscriptions.

Once you have your copyright, you can then set up Google alerts regarding your work. Customize your alert to include your book title, quotes, book passages, your name and more so that you will be aware of news about your book. This will also make it easier to track if someone has been posting your stories elsewhere and claiming to own them.

Connections are Important

Fellow authors make great critics and friends especially if you can trust them. If you are able to form a solid network of writer friends, they will be your support when the issue of plagiarism crops up. They may even be influential in recognizing your work which is being passed off as another’s. You can seek their advice on how to proceed with filing a plagiarism case.

Be Assertive and Take Action

When your work is stolen, you feel violated because you were the one who birthed that literary masterpiece. If this does happen to you, don’t try to repress your emotions. Rant if you must but don’t do anything that would hurt your own reputation. Instead, you should buck up and take legal action. Don’t let this event keep you from writing again. Instead, learn from it and you’ll gain an even deeper appreciation for your work and other writers’ works.

Do you take any proactive steps to prevent plagiarism of your work?

Author’s Bio: Based in San Diego California, Tiffany Matthews is a professional writer with over 5 years of writing experience. She also blogs about travel, fashion, and anything under the sun at wordbaristas.com, a group blog that she shares with her good friends. In her free time, she likes to travel, read books, and watch movies. You can find her on Twitter as @TiffyCat87.

Tips on Building the Confidence to Grow Your Business

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By Phil Buckley

My first experience with small business owners was in the late 80s. I was an operations manager for Zack’ Famous Frozen Yogurt, a franchise chain experiencing massive growth. My role was to set up new stores and help franchisees manage them successfully.

I was inspired by each owner’s courage, determination and passion to win. They tackled challenges head-on and typically took a glass half-full approach to managing problems.

However, when presented with opportunities to change or expand their businesses, I noticed that many owners lacked the confidence to get to the next level. They were comfortable with what they knew, and uncomfortable with what they didn’t know. Often, they’d forgo opportunities without fully exploring the benefits because their personal uncertainty was stronger than their desire for greater success.

As my career progressed into business training and then change management, I observed that most leaders struggled with change. Their confidence was tested most when their operational experience didn’t help them assess and pursue new opportunities or manage challenges. In those circumstances, what had made them successful had little impact on their ability to manage well.

Over time, it became apparent to me that the key to managing change (offering new products, entering new markets, opening a new location, etc.) is confidence.

Here are three ways that small business owners (and any business leader for that matter) can build their confidence when they uncover big opportunities to grow their businesses:

Make a list of the skills you used when making past successful changes

Small business owners will benefit from taking stock of past accomplishments and the skills they used to achieve them. Listing them in writing will help you build a playbook on how to manage new opportunities – steps to take, advice to get, behaviors to demonstrate, etc. Studying your past successes will help you create a path towards your goal and identify the capabilities you need to get there.

Identify who you can call upon for help

Peer support is a key enabler of evolving a business. Wise small business leaders ask for help, especially when opportunities require a departure from their current business model. Learning about how similar situations were managed, both successfully and unsuccessfully, will provide practical guidance on what you need to do, what to watch out for and how to act.

Write a solid plan

Business plans help small business owners stay focused and manage time and resources productively. They provide a means against which to track progress and a working tool to adjust as new information becomes available. A wise person once said, “Create the plan, work the plan, change the plan.” A growth opportunity business plan provides a map to confidently navigate.

It can be difficult to manage and grow a small business. With the right skills, knowledge, advice and plan, the small business owner can take the next step on their businesses journey and reach the next level of personal success. Have confidence!

Author’s Bio: Phil Buckley is a senior change management professional with nearly twenty-five years of experience helping individuals, teams and organizations deliver change in the United States, Canada, and the United Kingdom. Phil writes about managing change at www.changewithconfidence.com. He is also author of Change with Confidence: Answers to the 50 Biggest Questions that keep Change Leaders Up at Night (Jossey-Bass), where he provides complete, actionable answers to the fifty burning questions that leaders routinely ask about how to manage change successfully. Follow him on Twitter @philbuckley01.

If You Don’t Know Where You’re Going, You’ll Never Get There

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By Jennifer Dunn

Where is your business headed in 40 years? Yes, that question probably sounds ridiculous to you right now. You’re busy trying to survive another year, month, week or day, or even attempting to get your business off the ground in the first place. At what point are you supposed to think about 40 years in the future?

Honestly, you should be thinking about the future, because it will be here at some point. While you may not have to specifically worry about 40 years ahead, you should be considering where you want your business to be. If not, it could lead to some pretty bad situations for you that could lead to the demise of your business.

If you don’t have a plan for your company, it’s like it’s a plane without a destination – you can fly high for a while, but at some point you have to come down. If you don’t know where that is, you could be in for a rough landing.

Goals and Vision

Everyone has a vision for their business as well as a reason for getting into business in the first place. This reason could be absolutely anything – you wanted to spend more time with your family, or had a great idea for a product, or wanted to escape the rat race. It could even be to prove to yourself you could do it.

There is no wrong or right answer here. Your reasons are your own. The point is you have to honor those reasons and your vision for your company. If you don’t, you could end up with a monster you can’t control.

For example, let’s say you wanted to never compromise your product line as you believe it can change the world. It’s a lofty goal, but a great one nonetheless. Now let’s say you have an opportunity to sell your company to a bigger company. At some point you may realize the big conglomerate wants to change your product. Now you have a big problem – do you choose the money or the reason you went into business in the first place?

Find Your Destination

While this initially may not seem like such a big deal, eventually moving away from your original goals could lead to a point where you abandon your business. If you struck out on your own to spend more time with your family but you let your company get so big that you no longer have no time for them, you’ve defeated the entire purpose of starting your company.

This is why it’s important to look toward a destination for your company. If you have a place in mind for your company to land, you can make better decisions that will keep you happy and invested in your business. Even if something unexpected pops up you’ll be able to handle it with ease as you know where you want to end up.

Keep in mind this destination and your goals may change. You may start out wanting to make a ton of money and get rich but switch it later on to just being comfortable and being happy working on your own. Again, there’s no wrong or right answer – just make sure it’s what you want for your business and yourself!

Where are you heading?

Author’s Bio: Jennifer Escalona Dunn is the owner of Social Street Media where she writes about small business, tech and finance for sites like WePay and Outright. You can find her on Twitter @jennescalona.

Turning Customers Into Advocates

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John Caplan, founder and CEO of OpenSky.com, shares his tips on how leveraging the web’s social tools to build a community around your brand and engage directly with shoppers can grow your business.  

As an entrepreneur, I know how important it is to build a community of people around your business.  As a business owner who is passionate about growing emerging businesses, getting your business online to leverage distribution and build relationships is an essential tool. 
 
At OpenSky, we strive to empower emerging brands to grow their businesses by engaging consumers.  We make sure to communicate and constantly listen to the concerns, questions and feedback from our merchants and our members, which helps us build a platform that works for people we serve.
 
Leveraging the web’s social tools to build a community around your brand by engaging and communicating directly with your shoppers can grow your business.  Here are some ways to help you achieve this.
 

1. Social media makes it easier than ever to connect directly to customers.

Establish your brand on social channels – Facebook, OpenSky, Twitter, Pinterest — where you can have active, real-time conversations.  It’s not only a great way to share updates but often times, it’s that real time feedback from customers that can help you resolve a problem before it impacts a huge number of people.  This will serve as an effective way to give people a great experience because then they share it with their friends and their friends share it with friends and so on.  There is nothing more effective for marketing than a truly happy customer.
 

2. It’s essential to listen to customer feedback on social outlets and respond right away.

  However, as it important as it is, make sure that isn’t the only way you’re getting direct feedback from customers about how you’re doing.  Ask for it anytime an opportunity arises.  From packing slips, to invoices, customer surveys and emails – there are numerous opportunities to ask your customers for feedback and offer a place where they can provide it.
 

3. In addition to blogs and social networks, invite members of your community from customers to partners and vendors into your offices, stores or workshops.

  Whether it’s for a party, focus group, or to demo a new product – creating the face-to-face connection can be invaluable for creating brand loyalty.
 

4. One of the most difficult and stressful elements of growing a business is expanding your products or services. 

Adding a new feature or service can strain your core business and potentially alienate existing customers, especially in the beginning. Open the lines of communication and bring your community into your growth strategy by talking to them during the process.  Working with your core customers early on to help them understand new products and services will keep you on the right track, provide valuable insight and make your loyal customers more forgiving of any mishaps in the road to success.

Author’s Bio: John Caplan is the Founder and CEO of OpenSky, the social network for shopping where members shop with their friends for unique, artisanal finds. Prior to OpenSky, John was the CEO of Ford Models. In five years, he rebuilt the agency, tripling its size and value while expanding it to include Ford’s artist divisions and digital media business. During the late 1990s, John served first, as CMO of About.com leading the brands growth and later as President of the About Network before selling the company to Primedia in 2001 for $500+ million. Caplan has made numerous appearances as a business expert on television shows including CNBC, MSNBC, Bloomberg TV, Reuters TV, TODAY Show, WNBC-TV and many others.