Day: November 20, 2020
Californians rejected racial preferences even more soundly this year than in 1996. Will the Supreme Court reverse itself next?
Dropshipping is a popular method for building an e-commerce empire. The challenge is, there are tons of people out there trying to do the same thing. So, how do you get a competitive edge? By using dropshipping tools to get the most out of your dropshipping business.
This post covers the basics of dropshipping and the 11 best dropshipping tools to maximize this fulfillment method’s benefits while minimizing the drawbacks.
What is Dropshipping?
Dropshipping is a fulfillment method that allows e-commerce stores to sell products without storing or maintaining stock.
Using the dropshipping model, your store markets a third-party’s (a wholesaler or manufacturer) products. When someone places an order from your site, you buy the product from a third-party, who then sends the product directly to your customer.
You don’t have to worry about logistics, and the difference between the price you sell at and the price you buy at is your profit.
This model is popular (in fact, 23% of online sales are fulfilled through dropshipping) because it allows e-commerce businesses to focus on what they do best, marketing and selling products without worrying about logistic issues.
What are the Benefits of Dropshipping?
One of the major benefits of dropshipping is starting an e-commerce store with low start-up costs. You can create the framework for a great online store with relatively little investment.
The issue is, you’ve still got to invest in and warehouse stock — unless you use dropshipping.
Dropshipping limits startup costs while allowing e-commerce stores to offer a wide range of items to customers.
By working with a third party, you can quickly set up your online store and tap into a wide selection of high-quality products from suppliers around the world.
The benefits of this are:
- Low overhead costs: No need to pay for stock, warehousing, or employees to fulfill orders
- A wider selection of products: Choose from an endless list of suppliers.
- Expanded shipping capabilities: You’re working with businesses with years of experience shipping items around the world.
- Easy to scale: You don’t have to worry about stock. No matter how many orders you have coming in, you’re always able to fulfill them.
- Focus on your strengths: Concentrate on where your competitive advantage is – making sales.
- Location independence: Your stock doesn’t tie you down because you don’t own any.
These benefits sound pretty great, right?
As you might expect, there are also some drawbacks to dropshipping. The most apparent negative to dropshipping is lower profit margins. Companies that buy in bulk can save money, but buying one item at a time can be more costly.
Although you’re in control of your pricing (you can lower and raise prices as you like), you’ll have to keep your prices in line with your competition. And, because there are few barriers to starting an e-commerce business with a dropshipping model, there’s lots of competition out there.
Here are some challenges to consider with dropshipping:
- Customization and branding: You’re selling someone else’s products, so it can be harder to develop a strong brand.
- You’re reliant on a third-party: If they mess up, then in your customer’s eyes, you’ve messed up.
- Understanding costs: If you’re working with lots of different suppliers, it can be complicated to work out your profit margins when shipping is factored in.
Whether dropshipping is an effective strategy will depend on your business needs. If you’re ready to take on the stiff competition and aren’t reliant on branding to sell your products, then dropshipping could be a viable option.
What Dropshipping Tools Should I Use?
As you can see, there are plenty of benefits to using dropshipping as your fulfillment method, but there are some drawbacks as well.
These dropshipping tools can help you run a successful dropshipping business.
Shopify is the biggest e-commerce platform out there, and it’s one of the quickest and easiest ways to get your store up and running.
Shopify isn’t so much a dropshipping tool as the starting point for creating your store, so it’s important to feel comfortable with it. To ensure Shopify is right for your business, you can test out a 14-day free trial.
Once you’ve decided to build your store on Shopify, you have the following pricing options:
- Basic Shopify – $29/mo
- Shopify – $79/mo
- Advanced Shopify – $299/mo
You will still have to pay for your website hosting (here are some recommendations) which can be factored into Shopify’s price.
Whatever your goals, Shopify has a plan to suit your business needs and allows you to make the most of their customer support and a wide range of helpful plugins.
Oberlo is a Shopify app that links you to a large market of suppliers, allowing you to choose from a huge range of products and sync them to your website in seconds.
Their free starter package allows you to sell up to 500 products a month, so it’s an ideal way to dip your toe into dropshipping.
If you see good results, you can upgrade to the basic package for $29.90 a month, allowing you to sell more products and benefit from enhanced order tracking.
You can also choose the pro package for $79.90 a month, which allows you up to 30,000 sales.
If you already have a website that runs on WordPress, or you want a cheaper alternative to Shopify, then try WooCommerce. It’s a free plugin that can turn your WordPress website into an e-commerce store.
WordPress powers around 35% of the web, so you know you’re in safe hands with this platform, and the WooCommerce plugin allows you to give it powerful e-commerce capabilities.
Already have an e-commerce store set up? Spocket is one of the best dropshipping tools to connect you with suppliers from around the world.
Spocket integrates with Shopify, WooCommerce, Wix, BigCommerce, and AliScraper. It offers a free trial which allows you to view their catalog, but to truly benefit from this tool, you need one of the paid plans:
- Starter: Sell up to 25 unique products – $24/month
- Pro: Sell up to 250 unique products – $49/mo
- Empire: Sell up to 1,000 unique products – $99/mo
With many suppliers based in the US and Europe, Spocket is an excellent dropshipping tool for stores that value fast, easy fulfillment.
AutoDS is an all-in-one dropshipping tool for e-commerce stores that plugs into both Shopify and eBay. With AutoDS, you can automate processes like stock monitoring, optimizing pricing, updating tracking numbers, collecting social proof, and much more.
This dropshipping tool takes a lot of the busy work out of running your store and gives you more time to focus on boosting your sales.
One of the great things about AutoDS is they offer a vast range of packages designed to suit your business. They start at $6.33 a month for basic stores but can accommodate stores with up to 100,000 products.
Dropified connects you with suppliers and automates your dropshipping processes. With integrations for e-commerce platforms such as Shopify, BigCommerce, WooCommerce, GrooveKart, and CommerceHQ, it aims to give you all the dropshipping tools you need to run a successful business.
With lots of helpful automation, Dropified is ideal for sellers looking to develop their custom brand. They offer two distinct pricing structures:
- Import: $14/mo
- Private Label On-Demand: $168/mo
This dropshipping tool price might seem costly, but the ability to use private labels helps you overcome one of the most significant drawbacks of dropshipping – difficulty establishing your brand.
SaleHoo is a directory of wholesale companies and a great dropshipping tool for market research. Their annual plan gives you full access to the directory for $67, or you can choose a lifetime plan for $127. Those prices make it an affordable tool to research the market and find the best suppliers.
There’s also the option to upgrade to full automation, and you can get lifetime access to the SaleHoo education program for $47.
With so many apps helping you run your business, you might be wondering how to coordinate them all. The answer is Zapier.
Zapier automates workflows across different apps, which reduces manual work. For example, when you receive an order on Shopify, Zapier can instruct MailChimp to add that customer to your monthly newsletter and create an invoice through Invoice Ninja.
With a free lifetime plan that allows you to create 5 “zaps,” Zapier is one of those dropshipping tools you’ve got to try. If you find it significantly streamlines your store, then there are many plans to choose from.
AliDropship connects you to suppliers. However, there’s one big difference — with AliDropship there are no monthly fees. Instead, you make a one-time payment of $89 for a lifetime subscription.
You can also have AliDropship create you a website for a one-time price of $299, making it a viable alternative to Shopify. You will have to pay for your monthly hosting, but this option is about as quick and easy as it comes in terms of getting started with dropshipping.
For sellers looking for a fast, convenient way to get into dropshipping, AliDropship is an ideal option.
While many of the dropshipping tools on this list offer important insights about customers and traffic, some of the most important metrics can be found in your Google Analytics dashboard. All the data you need to know about your store is in your analytics for free.
There’s no need to pay for extra website analytics if you know how to make the most of Google Analytics, and this is the reason why it’s one of the most powerful dropshipping tools.
Track your visitors, understand where your traffic comes from, what content works well, and how to boost your store’s all-round performance by making use of the data that’s available to you.
If you’re dropshipping through eBay, then Chili-Hunter is a handy market research tool. Use it to discover new trends, find the most profitable items to sell, and get insight into your store’s performance and your competitors.
This dropshipping tool provides vital information to maximize your profits, and the best part is it comes in one simple plan.
You can choose either a monthly membership for $39.99 per month or a yearly membership for $16.66/mo.
With Chilli-Hunter, you can find the best products to dropship and boost your business’s performance in seconds.
One of the biggest challenges with dropshipping is maintaining workable margins. To do this, you need your e-commerce store to be as streamline as possible so you can adapt to changing markets and build up a large volume of sales.
To scale your business, look for ways to automate areas such as marketing, order processing, and product selection. This is where dropshipping tools come in handy.
While you will need to pay the monthly subscription fees for the right dropshipping tools, the return on investment can be immense.
How do you use dropshipping tools to give your store the edge?
Top 20 Multiplayer Games Podcasts Contents [show] ⋅About this list & ranking Multiplayer Games Podcasts 100% Crit Podcast Multiplayer Gaming Podcast The Dropshot CuboldCast Ultimate Europe 121 Two Player Bros Player-2-Player Bootleggers Buzzcast AggroChat | Tales of the Aggronaut Podcast Game Fix Show The Command Zone Squad Pod Doom Is Dead? 2GPMMORPG Poco’s Podcast | A Brawl […]
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What can a business credit expert help you do? What do you need to know to sound like or even become a business credit expert? It’s not as simple as a Google search, that’s for sure. You need someone who really knows the secrets to nailing small business funding.
Language is Impressive but Knowledge is the True Test of Being a Business Credit Expert
Use terms like tradelines, business credit reporting agencies, starter credit, credit line hybrid, EIN and more and you will have people thinking you are a business credit expert in no time. The problem is, unless you actually have the knowledge to back up how you sound, you can’t really help people, or yourself. Unless you are a business credit expert, you cannot guide people through the process of building business credit and using it properly. What do you need to know? Everything.
Business Credit Expert: What is Business Credit?
First, a business credit expert has a true understanding of what business credit is. Just having a credit card that calls itself a business card is not business credit. Business credit is credit under a company’s EIN. It has no association with the owner’s Social Security number. It is totally separate from personal credit, and therefore the business credit score can differ drastically from your personal credit score.
Check out our best webinar with its trustworthy list of seven vendors to help you build business credit.
This is credit in the business’s name and it is based on the business’s ability to pay, not the business owner’s. When done right, it is possible to get some business funding based on a business credit score without a personal credit check. Also, you, the business owner, aren’t personally liable for the credit the business gets. Business credit is essential to getting the small business funding you need.
The obvious answer is that a business credit score is based on the business’s ability to pay, not the owner’s. However, they are different in a number of other ways as well. Various factors affect your business credit score in ways vastly different from how they affect personal credit. Each of these factors affects business credit and personal credit in different ways.
Most personal accounts do not report late payments to your personal credit report until they are 30 days or more past due. Business credit accounts report to business CRAs when an account is only one day late.
When someone checks your personal credit report, there is a negative impact on your credit score. When a lender checks your business credit score, there is no negative impact.
Access to Business Credit Reports
The only ones who have access to your personal credit report are those to who you give signed authorization. In contrast, anyone can check your business credit score. They do not have to have authorization from you.
Name of the Reporting Account
Your personal credit report has the name of the company holding each account reporting. Your business credit report only lists the industry of the reporting account, not the company’s name.
How long information stays on your report
Though it varies, most information stays on your personal credit report for the life of the report. The average life of information on your business credit report is 3 years.
The details may vary between CRAs, but this gives a good idea of how long certain information can affect your business credit score.
Exact amounts are shown on your personal credit report. Business credit reports show rounded amounts.
Who Reports Payments to the CRAs
With personal credit, everyone reports your accounts and payment history. Only about 7% of those who check business credit actually report accounts to the business credit CRAs.
The amount of debt you have in relation to the amount of credit available to you makes a real impact on your personal credit score. If your cards are near their limits, you’ll see a decrease in your score. With business credit, being near your limits does not affect your score.
There is much less regulation when it comes to business credit, and there is virtually no regulation when it comes to correcting mistakes on your business credit.
You can get a free copy of your personal credit report each year. In addition, there are a number of free credit monitoring services that let you get a peek at your credit score. These are typically updated at least once a month.
There are business credit monitoring services. However, they are not free. Still, if you choose the right one, it’s worth it to know what is happening with your business credit.
Business Credit Expert: What are Business Credit Reporting Agencies?
Business credit reporting agencies are agencies that provide business credit reports. There are several, but the main three are Dun & Bradstreet, Equifax, and Experian. A business credit expert needs to understand what the business credit reports issued by these agencies say to lenders about businesses. Then, you can begin to understand the impact on small business lending.
Business Credit Expert: How Do I Get Business Credit?
You can’t until your business is set up properly. It has to be set up as a separate fundable entity aside from the owner. Until then, any accounts you have are just reporting to your personal credit, even if they are called business accounts. How do you change that?
Your business has its own phone number, fax number, and address. That doesn’t mean you have to get a separate phone line, or even a separate location. You can even still run your business from your home or on your computer if that is what you want. You don’t even have to have a fax machine.
Check out our best webinar with its trustworthy list of seven vendors to help you build business credit.
You also have to get an EIN. This is an identifying number for your business that works like how your SSN works for you personally. You can get one for free from the IRS.
Incorporating your business as an LLC, S-corp, or corporation is vital. It lends credibility to your business as one that is legitimate. It also offers some protection from liability. The big thing for business credit and fundability however, is that it is the only real way to separate business finances from personal finances.
Which option you choose does not matter as much for fundability as it does for your budget and needs for liability protection. The best thing to do is talk to your attorney or a tax professional. What is going to happen is that you are going to lose the time in business that you have. When you incorporate, you are creating a new entity. You basically have to start over. You’ll also lose any positive payment history you may have accumulated.
This is why you have to incorporate as soon as possible. Not only is it necessary for fundability and for building business credit, but so is time in business. The longer you have been in business the more fundable you appear to be. That starts on the date of incorporation, regardless of when you actually started doing business.
Business Bank Account
You have to open a separate, dedicated business bank account. First, it will help you keep track of business finances. It will also help you keep them separate from personal finances for tax purposes.
Furthermore, there are several types of funding you cannot get without a business bank account. Many lenders and credit cards want to see one with a minimum average balance. In addition, you cannot get a merchant account without a business account at a bank. That means, you cannot take credit card payments. Studies show consumers tend to spend more when they can pay by credit card.
Licenses are a Must
For a business to be legitimate it has to have all of the necessary licenses it needs to run. If it doesn’t, warnings are going to go up at every turn. Do the research you need to do to make sure you have all of the licenses necessary to legitimately run your business at the federal, state, and local levels.
Is That All?
No, it isn’t. The next thing you have to do is get accounts reporting. First, get a D-U-N-S number. You can apply for a free one on the D&B website. Dun & Bradstreet is the largest and most widely used business credit reporting agency. You cannot have a business credit report with them unless your business is in their system. The D-U-N-S number is how you get in their system.
Once you have this number, you can start to do business with companies that will report your payments to the business credit reporting agencies. You can do this in a few ways. The best bet is to try all three ways. The more positive payment history you have, the better.
Ask Companies You Already Work With
Vendors you already have a relationship with may be willing to give you credit without a credit check. Even if not, they may offer net 30 terms on invoices. They don’t have to. So, you will have to ask. If they agree, ask them to report the payments to the business credit agencies.
Ask Utility Providers
You pay things like utilities, rent, and the internet each month anyway. Ask those companies to report payments.
Use Starter Vendors
This is a little-known secret of business credit experts. Many business owners are unaware of starter vendors. Certain retailers will extend Net 30 terms in your business name without a credit check. Then, after you pay, they will report those payments to the business credit reporting agencies.
This is how you can get started building business credit business credit. They do not check either your business or personal credit score. Of course, they do have other risk reducing guards in place. They vary by vendor. Here are a few to help you start the process.
Crown Office Supplies
Crown Office Supplies offers paper and other office supplies. They report to all three of the major business credit reporting agencies, which of course include D & B, Experian, and Equifax. It can be hard to find vendors which report to Equifax, so getting credit with Crown is a good move. They do have a $99 annual membership fee.
Uline sells shipping, packing, and industrial supplies. Also, they report to Dun & Bradstreet and Experian. This means you must have a D-U-N-S number.
In addition, they ask for 2 references and a bank reference. The first few orders might need to be paid in advance to get approval for Net 30 terms.
Grainger Industrial Supply
Grainger sells power tools, pumps, hardware and other things. In addition, they can handle maintenance of your auto fleet. You need a business license and EIN to quality, as well as a D-U-N-S number.
You can apply by fax or over the phone. If you need less than $1,000 in credit, you only need a business license for approval. For over $1,000, you will need trade and bank references.
If you are just starting out and do not have references, the $1,000 is plenty to get you started building your business credit.
Why You Really Need an Actual Business Credit Expert
Knowledge is definitely what makes you a business credit expert. The best way to become one, and get that knowledge, is to work with an actual business credit expert. They know things that are not widely made known to the public. These are things that a simple Google search will not tell you.
Check out our best webinar with its trustworthy list of seven vendors to help you build business credit.
For example, you need a lot of accounts reporting business credit. You need several of these starter vendor accounts, but it is not easy to find vendors that will work like this. Most vendors do not make it known if they report payments to the business credit reporting agencies, or not. You need expert help to help you find the ones that you qualify with and that will report.
Vendor accounts change their underwriting and reporting practices regularly. It is incredibly difficult to keep up with. It takes alot of time and a lot of effort. An expert has the time and knowledge it takes to stay on top of which vendors are approving accounts, and what they look for. Also, they can keep tabs on who reports accounts and who they report them to.
In addition, it is usually a shot in the dark as to why you were denied business credit. A business credit expert has the knowledge and expertise to help you set yourself and your business up to give you the best chance possible. They know what creditors are looking for, and what gets you denied. It’s likely many of the reasons businesses are denied credit will shock you.
It is not easy to keep up with the ever changing world of business credit. With a business credit expert, you won’t have to guess.
The post How to Sound Like and Become a Business Credit Expert appeared first on Credit Suite.
Nordverse | Full stack engineer | Reykjavík, Iceland | ONSITE/REMOTE | Part-time / Full time We’re a team of medical doctors and software engineers building solutions for healthcare. We are currently located in Iceland and we are looking for world class developers to join our team. More information here: https://www.tvinna.is/jobs/full-stack-developer-6/ Get in touch (firstname.lastname@example.org).
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Specto | [https://jobs.specto.dev/](https://jobs.specto.dev/) | email@example.com | Europe, North/South America and matching timezones (remote) | Full-time | Android (Kotlin/Java/C++) | $120k-$180k | 0.15% – 0.35% We’re building the next generation front-end app performance monitoring platform (APM) for the mobile era. For the Android position we’re looking for engineers passionate about system internals and performance that have …
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What do you need to know about how to fund a startup business? First, there is more than one way to do it! It’s true. Regardless of what is happening around you, in most cases you can fund a startup business in some way. It may very well take longer depending on your exact situation, but it is almost always possible.
You Can Fund a Startup Business No Matter What is Going On
The thing is, virtually everyone assumes if they cannot get a business loan, they can’t fund a startup business. That really isn’t true. There are all kinds of options for funding. Loans are only one of them. Furthermore, there are probably many more types of loans than you think. We put together a list of some of the most common, and less common, ways to fund a startup business in any situation.
Fund a Startup Business: Traditional Loans
These are the loans that you go to the bank to get. With a traditional loan, you are almost always going to have to give a personal guarantee. This means they will check your personal credit. If it’s not great, you are probably out of luck. That is where a lot of people stop, thinking they have hit a brick wall.
There are ways over that wall however.
Fund a Startup Business: SBA Loans
SBA loans are traditional bank loans. However, they have a guarantee from the federal government. The Small Business Administration works with lenders to offer small businesses funding solutions that they may not be able to get based on their own credit history. Because of the government guarantee, lenders are able to be a little less strict on personal credit score requirements.
The trade-off is that the application progress is lengthy. There is a ton of paperwork connected with SBA loans.
Fund a Startup Business: Private Loans
Private business loans come from companies other than banks. These companies are sometimes called alternative lenders. Many have popped up in the past decade as entrepreneurship has become more common. The need for a financing option from somewhere other than traditional banks has spurred this growth.
There are a few benefits to using private business loans over traditional loans. The first is that they often have more flexible credit score minimums. They still rely on your personal credit. Yet, they will often accept a score much lower than what traditional lenders require. Another benefit is that they will sometimes report to the business credit reporting agencies. That helps build or improve business credit.
The tradeoff is that private business loans typically have higher interest rates and less favorable terms. Still, the ability to get funding and the potential increase in business credit score can make it well worth the cost.
Examples of Private Lenders
The thing about private lenders is, you almost always have a time in business requirement. However, it can be as low as one year, even 6 months in some cases.
The minimum loan amount available from BlueVine is $5,000 and the maximum is $100,000. Annual revenue must be $120,000 or more and the borrower must be in business for at least 6 months. Personal credit score has to be at least 600. It is also important to know that BlueVine does not offer a line of credit in all states.
With OnDeck, applying for financing is quick and easy. Apply online, and you will receive your decision once application processing is complete. Loan funds will go directly to your bank account. The minimum loan amount is $5,000 and the maximum is $500,000.
There is a personal credit score requirement of 600 or more. Also, you must be in business for at least one year. There is an annual revenue requirement of at least $100,000 as well. In addition, there can be no bankruptcy on file in the past 2 years and no unresolved liens or judgements.
Fund a Startup Business: Crowdfunding
Crowdfunding sites allow you to pitch your business to thousands of micro investors. Anyone who wants a piece of the action can buy in.
Investors pledge amounts ranging from as low as $5 to as high as they want. They may give $5, $80, $150, or even over $500. As a general rule, they can give as much or as little as they want.
Though not always necessary, most business owners offer rewards for investment. Typically, this comes in the form of the product the business will be selling. Different levels of giving result in different rewards. For example, a $50 gift may get you product A, while a $100 gift will get you an upgraded version of product A.
The two most common crowdfunding platforms are Indiegogo and Kickstarter.
Fund a Startup Business: Angel Investors
These investors are usually only in for a one-time deal. Many choose to spread their risk out over many people and many businesses to be certain they get a safe return on their investment.
Angels tend to be a lot more informal than most types of funding. They can be people you know. Or they can be people you connect with through networking or other means.
Angels are not covered by the Securities Exchange Commission’s (SEC) standards for accredited investors. But a lot of them are accredited investors anyway.
To become an accredited investor, an person has to have a minimal net worth of $1 million, and an annual income of $200,000.
There are a number of angels who aren’t millionaires. They could be friends or colleagues with home equity, or local professionals who are looking to invest.
How Do You Find Angel Investors?
The best way to find these kinds of investors is to ask. You can also try an angel investors website or network. Try Gust, which used to be called Angel Soft. They keep a database of investors, companies, and programs. Startups can also search for business plan competitions and more.
Another option is to look at the biggest angel investor groups. Be aware, however, that these meetings are really only going to happen if you can get an introduction.
According to Entrepreneur, in order from smallest to largest the top 10 Angel Investor groups are:
- New York Angels Inc.
- Alliance of Angels (Seattle)
- Pasadena Angels
- Hyde Park Angel Network (Chicago)
- Band of Angels (Menlo Park, CA)
- North Coast Angel Fund (Cleveland)
- Golden Seeds LLC (NYC)
- Investors’ Circle (San Francisco)
- Tech Coast Angels (Los Angeles) and
- Ohio Tech Angel Funds (Columbus, OH)
Focus and requirements may vary from group to group. For example, some concentrate on local startups only. Do your research so you don’t waste yours and the angels’ time if it isn’t a good fit.
Fund a Startup Business While Keeping Your Day Job
Here’s an option that most don’t want to hear, but it is totally legitimate and sometimes, it’s just the best way. If you do not have access to a ton of funds to launch a huge new business right away, consider keeping your day job and start your business small, as a side hustle.
Not every business can start this way, but a lot can. For example, a bakery or a cleaning business can easily start this way. If you set up from the beginning to be fundable and build business credit, you can go even further. More on that later.
Fund a Startup Business: The Retirement Years
This is similar to keeping your day job in that you start small. If you have retirement savings you could use that as loan security, or take a loan directly from retirement if your plan allows for that. You can build your business slowly, a little at the time. While you’re doing so, you can work to build business credit and overall fundability
Whatever You Do, Build Fundability from the Beginning
So, how do you do that? How do you build fundability and business credit? The first thing you do is set up your business to be fundable. When you do this, you will also be setting it up to be a separate entity from you as the owner, which is the first step in building separate business credit. How do you build a fundable foundation? You need the following.
Contact Information Separate from the Owner
The first step in setting up a foundation of fundability is to ensure your business has its own phone number, fax number, and address. That doesn’t mean you have to get a separate phone line, or even a separate location. You can still run your business from your home or on your computer if that is what you want. You don’t even have to have a fax machine.
The next thing you need to do is get an EIN for your business. This is an identifying number for your business that works in a way similar to how your SSN works for you personally.
You have to incorporate as an LLC, S-corp, or corporation. It gives credit to your business as one that is legitimate, and it separates your business from you as the owner.
Which option you choose does not matter as much for fundability as it does for your specific budget and liability protection need. The best thing to do is discuss it with your attorney or a tax professional. You are going to lose the time in business that you have. When you incorporate, you become a new entity. Basically, you have to start over. You’ll also lose any positive payment history you may have.
This is why you have to incorporate as soon as possible. Not only is it vital to fundability and for building business credit, but time in business is also important. The longer you have been in business the more fundable you appear to be. That starts on the date of incorporation, regardless of when you actually started doing business.
Separate Business Bank Account
You have to open a separate, dedicated business bank account. There are a few reasons for this. First, it will help you keep track of business finances. It will also help you keep them separate from personal finances for tax purposes.
In addition, you cannot get a merchant account without a business account at a bank. That means, you cannot take credit card payments. Studies show consumers tend to spend more when they can pay by credit card.
For a business to be legitimate it has to have all of the necessary licenses it needs to run. If it doesn’t, red flags are going to fly up all over the place. Do the research you need to do to ensure you have all of the licenses necessary to legitimately run your business at the federal, state, and local levels.
These days, you do not exist if you do not have a website. However, a poorly put together website can be even worse. It’s the first impression you make on most, and if it appears to be unprofessional it will not bode well for you with lenders or customers.
Fund a Startup: Build Business Credit
Okay so, you need to know how to fund a startup, not how to set it up, right? Here’s the thing. Once you have your business set up like this, you can start building business credit so that you have more options for funding your business.
The main key to this is to use starter vendors that will issue net terms on your invoices and report those payments to the business credit reporting agencies. Even if you are keeping your day job or starting small during retirement, you can use these vendors for the things you need in the everyday course of business.
Things like office supplies, packaging, and even cleaning supplies can be purchased from such vendors on account using your business information. As you get enough of these accounts reporting, you can apply for store credit, then fleet credit, and eventually, regular business credit cards that are not limited to specific types of purchases or specific stores. Then, your business credit should be strong enough that you can qualify for a loan and launch your business on a bigger scale.
Fund a Startup Business: There are More Ways than One
The truth is, there is more than one way to fund a startup business. Depending on your specific situation, you will have to decide which option or combination of options will work best for you and your business.