It is time to get into the nuts and bolts of running a business. This week’s Entrepreneur University comes courtesy of Mark Gwilliam. Mark uses his international experience to coach small business owners on how to run successful businesses. Mark shares his advice on how to create a budget for your small business:

“There you are, running around in small circles with deadlines to meet and bills to pay. Can you really afford the time required to produce a detailed budget? Isn’t your time better spent generating revenue?

Yes and no. To paraphrase Alice and the Cheshire cat: “If you don’t know where you are going, you are sure to get somewhere if you only walk long enough”. The budget provides you and your investors with a numerical map that leads somewhere specific.

What is a budget?

A budget is a forecast of revenue, expenditure and profit. Most budgets are revised annually.

What does it achieve?

There are two (often overlapping) reasons for producing a budget. One is to persuade potential investors that your company is a good bet. The other one is to plan your business finances - how much money do you have and how do you plan to use it? How much revenue do you need to generate to achieve your target profit? Is your business plan viable or does it need adjusting? In retrospect, did the year pan out the way you planned, or did something go wrong?

How to approach a budget First, find out how your accounting software deals with budgets. It’s far more efficient to use the same package for accounting and budgeting. Next, meet your accountant to plan how to structure the budget. Arrive prepared, with a chart of accounts and a list of informed questions. Take copious notes.

Traditional budgets are very difficult for start-ups and firms with a short history, because there is little or no historic data. Revenue is particularly problematic, because no matter how carefully you have planned, it’s impossible to predict the future. There are two main approaches to budgeting:

The projections approach Here you enter projected costs and projected revenue, and calculate projected profits from these. This is reasonable and rational if the company has several years of relatively stable history to project from. If it’s a new company, such a budget is likely to become an exercise in denial and wishful thinking.

The required profits approach An alternative method is to enter projected expenses, and then calculate how much profit you require, and how much you think you can actually generate.

Eventually this should be enough to pay your salary and provide a return on your investment in the company. However, it might be realistic to plan for a loss in the first year or two, and only a small profit for a year or two thereafter.

Having settled on a number, you now add expenses to profit to come up with your required revenue.

Turn this number inside-out. Is it realistic? Is it achievable? Instead of guessing wildly how many widgets you may be able to sell, or how many hours you hope to bill, you can now soberly assess whether you will be able to reach your targets. Don’t have 10,000 billable hours in the year? Can’t afford enough machinery to make a million widgets? Go back and adjust the business plan.

Once the company is liquid, determine your salary based on what you would be earning if employed in a similar job, and your return on investment based on the interest you would receive if investing outside the business.

EXPENSES Fixed costs Fixed expenses remain the same regardless of sales volume. They include rent, loan repayments, and insurance.

Semi-variable costs These are costs with fixed and variable components, such as telephone, salaries and wages. The fixed component is the minimum cost of supplying goods or services, while the variable component changes depending on sales volumes.

Variable costs Variable costs increase or decrease in line with sales, and include costs of materials, distribution and commissions.

Start-up costs Initial costs must be factored in for a start-up.

REVENUE If you use the required profits method outlined above, you will have generated a total figure for required revenue. This is a goal rather than a prediction. You need to break it down to decide how many of what you need to sell, what you need to charge, and whether the targets are realistic. It has the added advantage of generating very clear monthly sales targets.

Once the business has been running for some years, revenue will be predicted in a more conventional way, based on past performance.

MONITORING THE BUDGET Once you have set up the budget, compare it to the actual figures every month, to look for differences and establish why they are there. Adjust expenditure or sales efforts as you go along, to bring the next group of numbers in line with the budget.”

Have you set a budget for your business?

For this week’s Entrepreneur University we turn to Cynthia Minnaar. Cynthia lives in South Africa and runs her own online home business. She is the proud owner of www.cyns-home-biz.com, the online home business site for online home based business start-up ideas, extra income opportunities, internet marketing training, affiliate marketing solutions and resources.

Cynthia shares with us how online entrepreneurs can get started on a shoestring budget:

“The secret to start making money online with your own internet home business is in the actual marketing of your business and there are many methods of internet marketing that are highly effective and will cost absolutely nothing if you give yourself time to learn the ropes and apply them.

In actual fact, the running costs of an internet home business can reduce every month as you learn how to market effectively at no cost at all.

If you are serious about building an online home business income from a real internet home business then at the outset you need to be sure that you select a reputable hosting company for your website. This is one area where it is not advisable to opt for free hosting.

Your aim is to drive targeted traffic to your website and if you are on a budget this just may take a little longer than someone who has spare dollars to purchase targeted leads. But, rest assured you will gain a great deal of knowledge as well as achieve huge personal success if you learn the methods that drive targeted traffic to your site at no or very little cost at all.

Here are some highly effective internet marketing methods that you can start working on immediately to drive targeted traffic to your home internet business website and start making money online.

Choosing Relevant Keywords

This is the foundation of your business and you need to establish what keywords or keyword phrases people will type into the search engines to locate your website. There are many free keyword selector tools available on the internet to help you with this, for example you could use the free version of Wordtracker or the Google keyword tool or the Overture keyword selector tool.

Search Engine Optimization

Once you have established what keywords you are going to use then you need to optimize your website for those keywords. You can also obtain free software on the internet to help you optimize your website, for example WebCEO can be downloaded free. Once you have completed optimizing your website, open a Google Webmasters account for free, create a sitemap and submit it to Google. Keep your sitemap current by submitting a new sitemap whenever you make changes to your website. Also submit your website to the search engines and it is advisable to submit to the major search engines manually.

Blog, Tag and Ping

Ideally you need to post on your blog at least once a day and be sure to hyperlink your keyword into the post so that it points back to your website in order to build back-links to your website that will help you rank higher in the search engine results. You need to aim to continually build back-links to your website. Be sure to tag your posts and then ping your blog to announce to the blogging community that you have just added a new post. There are many free pinging services available on the internet. Add your Blog RSS url to your My Yahoo account as well, which will ensure the indexing of the links on your blog posts.

Post in Forums

Forums are another free method of not only advertising your internet home business, but where you can also gain a tremendous amount of knowledge and assistance. Set up your signature with your keyword linked to your website and this will be free advertising for you as well as adding back-links to your site. Get involved and constructively post and contribute 3 to 5 times a day.

Article Marketing

This is a very highly effective method of gathering back-links to your site and securing high positions in the search engine results. If you write an article or two every week and distribute it to as many article directories as possible you will notice a massive change in your rankings weekly. Be sure to write articles based on the theme of your website and use the keywords you have selected and hyperlink the keyword to your url in the author resource box. You may at a later stage want to spend a portion of your budget to pay to have your articles distributed or purchase an Article Submitter.

Directories

Search the internet for seo friendly directories and start submitting your website to them, try and submit to 5 directories a day.

In Conclusion If you get involved in learning these free very effective methods of driving targeted traffic to your website, you will not only start making money online but you will automatically find that you start learning and getting involved in other marketing methods such as RSS, Social Bookmarking, etc., which will take your internet home business to the next level.”

For this week’s Entrepreneur University we turn to Virden J. Thornton. Virden is the founder and President of The $elling Edge®, Inc. a 23 year old firm specializing in sales, customer relations, personal coaching and management training and development. Clients have included Sears Optical, Eastman Kodak, IBM, Deloitte & Touché, Bank One, Jefferson Pilot, and Wal-Mart to name a few.

Virden shares his thoughts on how to increase your closing rate:

“A closing question asks for a final decision. A trial-closing question is one that asks prospects for an opinion. Trial-closings should be non-threatening questions that ask how your prospective customer feels about what you have presented. Typical trial-closing questions can build in their directness as these examples illustrate:

• “How does this approach sound?”

• “Which of the two demonstrated packages do you like best?”

• “Do you see how this approach can save you money?”

• “What are your feelings about our guarantee program?”

• “Do you need additional information before making a decision these products and/or services?”

Ron Willingham, one of today’s top sales trainers has stated, “From the time you begin your demonstration to the point you feel a close is appropriate, your objective is to get opinions, reactions, feelings or feedback.” Without asking trial-closing questions you’ll never have enough information to effectively close a sale.

When a sales or service industry professional closes after a presentation, tying off a sale is made much easier when trial-closing questions are executed throughout the presentation phase of your discussion. For example:

“Paul, how do you feel about our program as it has been explained to you?”

- or 1 “Paul, can you see how the cost savings in our plan will more than offset the cost of installation?”

When you close on an appointment, tying off an appointment (sale) is made much easier when you use trial closings throughout the conversation. For example:

“Bob, with your busy schedule, would an afternoon or early morning meeting time be best for you?”

- or 1 “What this means to you, John, is that you can receive a free analysis on your present services with no obligation to purchase our services. Can you see how a 15, no more than 20 minute meeting might clarify some of your issues with your present vendor and give you the information you need to make a sound decision?”

As you receive a favorable response from your trial closings, it really makes it difficult for your prospects to give you an arbitrary “no,” when you later ask them to purchase your product or package of products that you have demonstrated. As you practice using trial-closing questions, you’ll watch your closing ratios and profitability dramatically improve.”

For this edition of Entrepreneur University I turned to productivity coach Lorraine Pirihi. Lorraine is the Productivity Queen and she helps entrepreneurs get more time, make more money, and have a life in your small business.Lorraine offers her 7 tips for how small business owners can achieve success:

“Running a small business requires many skills. However, to do this successfully you need to organize yourself first. Avoid procrastination - read the following and take action.

1. Successful Small Business Owners Look After Themselves First

Exercise regularly, eat healthily and be around positive people. Feed your mind by attending personal development courses. Read self-help and motivational books, listen to tapes. Stress management levels will be much more effective when you look after yourself.

Do the right thing by yourself and you’ll have heaps of energy, be motivated, have more balance in your life which in turn will help you be more productive and successful.

2. Successful Small Business Owners Clean out the Clutter Regularly

You will save yourself heaps of time, energy and money if you clear out your work and home environment…paperwork, books, old equipment etc. You’ll be able to find things, save money because you won’t have to buy what you already have hidden somewhere, plus you’ll be less stressed. Organize your office and your small business premises regularly…keep the clutter out. Eliminating clutter will help you to avoid procrastination. It’s too easy to avoid getting things done if you are overwhelmed with clutter.

3. Successful Small Business Owners Use the Right Tools

It’s no good having the latest whiz-bang computer when the desk that you sit at is too small to accommodate it, or the chair has poor back support, or the lighting is dull causing you eyestrain and fatigue. All these factors heavily influence how you work. Invest in a decent desk, purchase a desk lamp or change the light globes.

Don’t avoid the warning signs your body gives you. Take action now before you have eye, back or neck problems.

4. Successful Small Business Owners Use a Diary or Digital Organizer

With so much to organize in your small business, you need to record your appointments and things to do and goals somewhere. Preferably in a paper diary or digital organiser that you can take everywhere. This is the most effective way to get things done, plan your work and your life. Balance is extremely important. Top achievers are great at time management (even if they have to pay someone else to organize them).

5. Successful Small Business Owners Learn to say “No”

To dramatically improve your productivity and do more of the things you want, you have to be firm with others and let them know if you cannot, will not or are unavailable to fulfil their requests. If you constantly say “yes” to everyone else’s requests you will never have the time to do what you really want to.

Book yourself into a self-assertiveness course to learn these skills if you feel you need to.

6. Successful Small Business Owners Do What They Do Best and Delegate the Rest

See what tasks you can delegate tasks which would suit someone else’s talents. Many small business owners are spending heaps of time on mundane secretarial tasks which would take a person who is trained in that area a quarter of the time to undertake. Stress management is an important part of running your small business. Reduce the stress by delegating or outsourcing wherever you can.

Use a bookkeeper, personal assistant or virtual assistant. Always ask yourself, who else can I get to do this? Use your time management to focus on what you do best.

7. Successful Small Business Owners Only Have Meetings if Necessary

Make sure the meetings you organize in your small business are relevant and run effectively. Avoid procrastination - always make sure there is an outcome and all actions are followed through.

The Final Word By following these simple yet very effective time management tips for small business owners you will have more control over your work and your life. You’ll have more balance, experience less stress and be more proactive.

Avoid procrastination…take action today!”

For this edition of Entrepreneur University I turned to strategic planning consultant Glenn Ebersole. Glenn runs The Renaissance Group, a multi-disciplinary and strategic thinking consultancy firm. They offer a unique approach to a wide range of strategic planning, management, marketing, public relations, and communications assignments through our team of independent professionals.

Glenn offers his advice for how to improve your use of email:

“The number of business emails we send and receive continues to grow at an amazing pace. And from my personal experience, more and more of my clients that prefer email communications as a preferred communications mode.

Email can be a very effective and efficient means of communicating. However, how many of the emails we send and receive can we honestly say are effective and efficient? And what can we do to improve our email communication?

Looking at those questions, Your Strategic Thinking Business Coach developed a short list of six (6) strategic steps to take to improve your email communications.

Strategic Step #1: Write a title for your email as if it were a “headline” in a newspaper or a strategic marketing communication. The email title must grab the recipient’s attention and should describe the content and a benefit to make the email recipient curious enough to open your email.

Strategic Step #2: Use an email address that is recognizable to the recipient so your email will be opened and not automatically deleted or deleted quickly by the recipient.

Strategic Step #3: The opening sentence of your email must also grab the attention of the email recipient so they will read on.

Strategic Step #4: Be very clear in the first paragraph about what you are offering, providing, inquiring about, etc. and why there is value for the recipient to respond to you or to take some requested action.

Strategic Step #5: Include a call to action for the reader that specifically tells the reader what you want the reader to do next.

Strategic Step #6: Make it very simple and convenient for the recipient of your email to respond.”

How do you use your email?

For this edition of Entrepreneur University I turned to the joint venture expert, Robin Elliott. For more than 19 years Robin has worked with small business owners helping them attain success through joint ventures. You can learn more about him at his website: JVWisdom.

Robin shares with use three examples of easy ways you can joint venture your business to success:

“When people think Joint Ventures are complicated or difficult, it’s good to review some simple examples of real Joint Ventures that I have recently done. Here are three of them:

A Member of the DollarMakers Joint Venture Forum (I only deal with Members) set up a meeting with a well-known seminar leader, who agreed to have me speak at one of his seminars. Out of the 30 people attending (each was paying $3,000 to attend the program), 14 signed up as Members. This is an unusually high percentage.

Anyway, the seminar leader and the Member each made good commissions. This seminar leader has 3,500 people in his database and the next step is to arrange a more formal relationship and also to use a teleconference to sign up more Members. This is a win/win/win/win scenario, done with no cost or risk and very little time.

The Member and seminar leader will naturally get good commissions on any of those new Members who attend Bootcamps in the future, as well.

Another Member, who is involved in a local church, is arranging for me to present a Bootcamp at the church as a fund raiser. We have agreed on a minimum amount payable per delegate, and all the money will go to the church. I will receive a tax receipt equal to the amount of money raised.

We expect, given the amount of church members and the demographic profile, to raise between $5,000 and $10,000 for the day. The church incurs no cost or risk and uses very little time. I sign up new Members and the Member who arranges the JV gets paid on all Members that sign up. In addition, his own business will get great exposure. Everyone wins. This can work for service clubs, sports clubs and societies as well.

A third Member has linked me up with a well connected and influential entrepreneur in another country. All it took was a simple phone call. Any resulting bootcamps or business will make the Member serious money, and as I haven’t worked in that country before, the sky is the limit.”

How have you used joint ventures to help your business grow?

For this week’s edition of Entrepreneur University we looked for advice on what to do when prospects give you the “silent treatment” by turning to sales expert Ari Galper. Ari is the creator of Unlock The Game™, a new sales mindset that overturns the notion of selling as we know it today. With a Masters Degree in Instructional Design and over a decade of experience creating breakthrough sales strategies for global companies such as UPS and QUALCOMM, Ari discovered the missing link that people who sell have been seeking for years.

Here is Ari’s advice on how to get past the silent treatment from your prospects:

“If you’ve been selling for a while, you’ve probably had at least one experience in which your prospect suddenly started giving you the “silent treatment.”

Anthony described this dilemma very poignantly when he called me a few weeks ago:

“Ari, I don’t know what to do when I get hit with the ‘silent treatment’ — you know, when I’ve worked with a prospect for quite a while, and we’ve had great conversations, and they’ve expressed interest in our solution — and then all of a sudden everything stops. I try calling them back once or twice. I even send a follow-up e-mail, but nothing. They just disappear. And I figure I’ve lost the sale, and I don’t know what I did wrong, or what to do next. It makes selling feel like such a painful and arduous process.”

If this has happened to you, you may have felt anxious and confused. You may have told yourself, “It’s not as if I’m the one who did anything wrong. I put everything into the relationship. How can I rescue the sale if I can’t even get them to talk to me?”

The “Hopeium” Trap There is a pressure-free way to reestablish communication when your prospect starts giving you the “silent treatment.” But first, it’s important to understand why the situation has happened in the first place.

Most of us who sell get caught up in “hopeium,” a comical term that means we focus our hopes and desires on making the sale. But hopeium can be a trap, because it’s impossible for you to keep in mind your most important goal: to learn your prospect’s truth.

When we fix our minds on the outcome — making the sale — we automatically begin anticipating how the process will go, and we also begin expecting that things will happen as we hope they will.

But if we’re in that mindset and our prospect suddenly breaks off communication, we feel lost, anxious, frustrated, discouraged, and confused. We become preoccupied with what went wrong.

We may even feel betrayed.

Is there any way to clear up the mystery?

Yes, by giving up your agenda and learning the truth about where you stand with your prospect –and being ok with whatever the truth may be. “But how can I learn the truth when they’re avoiding me?” you may ask. “And why do I need to let go of the sale?”

Let’s take the second question first.

If you approach your prospect while you still hope the sale will happen, you’ll introduce sales pressure into the relationship. This will push your prospect away from you and destroy any trust you have developed with them. Instead, you can eliminate sales pressure by telling them that you’re okay with their decision if they’ve decided not to move forward.

In other words, you take a step back instead of trying to chase and follow up with calls because you’re focused on getting a “yes.”

The bottom line is:

When a prospect gives you the “silent treatment,” it doesn’t mean you’ve lost the sale. It just means you don’t know the truth yet.

What you need to do is call and learn the truth.

Why is learning the truth so important?

Here are 4 important reasons:

1. You stop losing confidence in your selling ability. The “silent treatment” threatens our “hopeium.” We start blaming ourselves. We don’t know where we stand — a painful state of limbo. Our self-talk is negative and full of self-blame, and we’re on pins and needles wondering whether the sale will still come through somehow.

2. You increase your selling efficiency and decrease your stress level. Once you learn the truth about your prospect’s situation, you can either stay involved with the prospect or move on. I often say, “A ‘no’ is almost as valuable as a ‘yes.’” Why? Because it frees up your time to find prospects who are a better fit with your solution. This lets you work much more efficiently because you can quickly weed out prospects who aren’t going to buy. Knowing the prospect’s truth lets you walk away without that guilt-laden voice whispering, “If you give up, you don’t have what it takes.”

Learning your prospect’s truth translates into tangible results that equal real dollars. You’ll also put an end to the self-sabotaging stress that comes from living in “silent treatment” limbo.

3. Sales pressure pushes prospects away. When you respond to the “silent treatment” with calls and e-mails, you’re really telling them that you’re determined to move the sales process forward — which means you’re looking out for your needs, not theirs. This makes them mistrust you and run the other way.

4. The “silent treatment” — totally breaking off communication — is how prospects protect themselves from sales pressure when they don’t feel comfortable telling us their truth. The more we press, the more they run.

But the opposite is true, too. The more we relax and invite the truth, the more straightforward they’ll be with us. Prospects feel okay sharing what’s going on with them when they know we’re okay with hearing it.

How to Reopen Communication After Anthony and I had talked about some of these issues, he said, “This all makes a lot of sense, Ari, but I’m still not sure what to say when I make that call.”

It’s simpler than you might think.

* First, simply give your prospect a call. (E-mail and voicemail are very impersonal, so use them only as last resorts if you can’t reach your prospect after several phone calls.)

* Second, take responsibility and apologize for having caused the “silent treatment”. Here’s some language I suggested to Anthony that will make prospects feel safe enough to open up and tell you the truth about their situation:

“Hi, Jim, it’s Anthony. I just wanted, first of all, to call and apologize that we ended up not being able to connect. I feel like somewhere along the way maybe I dropped the ball, or I didn’t give you the information you needed. I’m not calling to move things forward because I’m assuming you’ve probably gone ahead with someone else, and that’s perfectly okay. I’m just checking to see if you may have some feedback as to where I can improve for next time.”

When you respond to the “silent treatment” this way, the results will probably surprise you. You may even learn that the prospect has legitimate reasons for not having gotten back to you.

You’ll also find yourself more productive and less frustrated. It’ll make a world of difference in your productivity level, your stress level, your income, and how much you enjoy what you’re doing.

Remember…

You haven’t lost the sale. You just don’t know the truth yet.”

How have you gotten past the “silent treatment” with your prospects?

For this week’s Entrepreneur University we connected with Tim Knox. Tim is the founder and president of four successful technology companies and serves as an investor, mentor and advisor to many companies in his home town of Huntsville, Alabama. Here are Tim’s suggestions for how to build find products to sell on eBay:

“I was part of an eBay Roundtable discussion recently with six other experts and we all agreed that the number one question most new (and even old) eBay sellers ask is:

“Where do I find things to sell on eBay??”

To help answer that question I have compiled 11 ways that anyone can use to find products to sell on eBay. This is by no means a definitive list and depending on your situation, some of the ways may not apply to you. However, if you’re a beginner and don’t know where to start, this list should help you get on track.

1. Look Around The House:

We all have items lying around the house that we no longer use or need. Have you grown or shrunk in size? If so, you have clothes you can no longer wear and can sell. Did you get a gift for Christmas or your birthday that you will never use? If so, slap it on eBay (just don’t let the person who gave you the gift find out). Do your kids have toys they no longer play with? Just looking around your house and garage should give you plenty of things to get your eBay ball rolling.

2. Garage Sales and Flea Markets:

When it comes to eBay, remember this old adage: One man’s junk is another man’s treasure. Now this is not to say that you should sell junk on eBay. You should only sell products in good condition. The point is you can find items in good condition at garage sales and flea markets that you can pick up cheap and resell for a profit. Remember, nobody wants to buy your old Beanie Babies that no longer have eyes and noses, but they may buy “gently used” items if they’re in good shape and offered at a good price.

3. Talk To Your Friends and Relatives:

After you’ve gone through your own in-house inventory, contact your friends and relatives and tell them you have started an eBay business and will sell their items for a piece of the sales price. Chances are they have as much excess stuff lying around their house as you did. Offer to list the items for them and if they sell, take half the profits. You will probably have to pay the eBay fees out of your pocket up front, but you can then deduct the eBay fees from the sales price before slicing up the pie.

4. Consignment Sales:

Consignment sales are a great way to find a wide range of products to sell on eBay. Consignment selling means that you offer to sell an item that belongs to a company. In exchange for your trouble you get a percentage of the sales price. You can charge up to 50% plus fees for smaller items like clothing, lamps, jewelry, etc. and around 15% for larger items like cars, boats, and bulldozers (yes, I said bulldozers).

Contact every business in town and offer to list their excess goods on eBay for a piece of the action. Most businesses have returned items, liquidated products, used equipment, etc. that they would love to get rid of, but don’t have the time to do so.

Many will see you as their hero if you can help them get rid of this merchandise and you’ll make a pretty profit for your efforts. For business customers you should have them pay the eBay fees on the front end, not you.

5. Thrift Stores:

Thrift stores are an excellent place to look for things to sell online. Stores maintained by the Salvation Army and non-profit organizations are best. Many church thrift stores price their goods at almost retail level, so you may not find too many bargains there.

Much of the merchandise you will find at thrift stores has been donated by middle to upper income families, so many times you can find high quality merchandise in excellent condition. And don’t be afraid to make them an offer, especially if you are buying in bulk. Nobody pays sticker price at thrift stores.

6. Mini Storage Unit Sales:

Mini storage companies are everywhere and most of them are filled with stuff that people no longer want, but have no other place to store. Did you know that if someone who is renting a mini storage unit fails to pay the rent the owner can confiscate their stuff and sell it? This is bad news for the renter, but great news for you. Call every mini storage company in your area and ask that they notify you if they ever have items to sell. Many will put you on a notification list for their upcoming sales.

Some may even say, “Sure, come on over!”

7. Local Auctions And Estate Sales:

I’m a live auction nut. I’m not talking about the hooty snooty art auctions. I’m talking about the good old fashioned auctions with hard benches and hot dogs and cheap, good stuff. I love going to auctions and digging through boxes and bidding on things. My problem is I don’t know when to quit buying. It’s just so dang much fun holding up that little paddle and winning a sale, even if it’s something you don’t really need.

Check your area for auctions and sales you can attend. Just make sure you don’t pay more for something than you should. Your goal is to buy low and sell high. Don’t get so caught up in the bidding that you pay more than a product is worth (voice of experience here).

8. Closeout Stores:

You can find some great bargains at the big warehouse closeout stores. Look for liquidated items or items you can buy in bulk.

And don’t be afraid to make them an offer. I never pay sticker price at closeout stores and neither should you. Call the manager over and ask him what he’ll take for the entire box of something you’re interested in. You may be surprised to find him more than willing to deal.

9. eBay And Other Online Auctions:

Did you know that you can find great deals on products you can buy and resell on eBay and other online auctions? If a seller does a lousy job on his ad chances are he will get very few bids and you can snap up the item at a deal, then create a great ad and sell it for a profit.

You can also find wholesale bulk lots on eBay that you can buy and piece out for sale one at a time. This requires the cash to buy the inventory and a place to store it, but this is the best way to get the lowest price on most wholesale goods.

You should also visit the other online auction like Yahoo and Ubid.com to look for bargains. These sites do not have the traffic and customer base that eBay has, which means auctions there get fewer visitors and lower bids. Do a Google search for “online auctions” to hunt for treasure there.

10. Wholesalers and Dropshippers:

Once your eBay business is rolling you can move it up a notch by establishing relationships with wholesalers and dropshippers who can provide you with merchandise to sell. You will get the lowest price by buying in bulk from wholesalers, but that is a level you should build up to. Don’t buy a truckload of liquidated products until you are sure you can sell them.

11. Contact The Manufacturer:

If you find a product that you think would be a good seller just pick up the phone can call the company that manufactures. Tell them you are interested in the product and were wondering if they had a distributor in your area. If they do, contact the distributor and inquire about buying the product wholesale. If the company does not have a distributor in your area simply say, “How do I go about becoming your distributor.”

There may be costs involved that makes if prohibitive for you to become a distributor, but you never know until you try. Again, research the market thoroughly to make sure there are customers who will buy the product and if you do have to invest money to get started, only invest the minimum allowed and consult an attorney if there are legal forms you’re asked to sign.”

This week’s Entrepreneur University comes courtesy of Franchise Gator. Franchise Gator pride themselves on linking real people with real franchise opportunities. You can search franchises, opportunities and business for sale listings to locate profitable home based business ideas, top franchise concepts for 2008, or high income business opportunities. Franchise Gator discusses if a franchise is right for you:

“There are a number of questions an entrepreneur should ask himself before buying a franchise. As with any new business venture, you should carefully weigh all your options before starting a franchise. This article will cover some of the many issues that should concern a potential franchisee.

Financial considerations First and foremost, do you have the necessary financial resources to buy a franchise? If the answer is “no,” you will need to decide where you will get your start-up capital. Should your initial financing be proven insufficient, do you have alternate financing resources? These could include friends and relatives who might be able to lend you money. You should also be prepared to make financial sacrifices in order to get your new business off the ground.

The potential loss of company benefits such as health insurance and retirement plans should be significantly outweighed by the monetary and self-satisfaction rewards that you anticipate receiving from your franchise business. Additionally, you will need enough money in savings to provide you and your family a one-year “cushion.” This allows your business a one-year period to break even. Most new businesses do not break even for at least one year, and franchises are no exception. You need to be aware of this fact. And, for this reason, you will also need to decide whether you will retain your current occupation while your franchise is in this pre-profit stage.

In preparation for buying a franchise, you should compile a written balance sheet that details all of your assets and liabilities including liquid cash.

Finally, if applicable, your spouse should be in total agreement with your business plan. Starting a business is a difficult task to undertake—one that requires the support of friends and family. Your spouse should be fully apprised of the financial challenges that can be involved with buying a franchise business, and he or she should be willing to take on these challenges.

Personal considerations Starting a new business involves long hours and countless administrative duties. You—and your spouse—should be certain that you will be physically and emotionally capable of handling this. Potential franchisees also need to consider who else will be affected by their long working hours. For example, do you have small children who will be negatively impacted by your frequent absence?

After thorough research on your selected franchise, you should be reasonably certain that it is a business you will enjoy operating for a number of years—or even until retirement.

Anyone considering buying a franchise needs to realistically asses his own personality. Do you enjoy working with others? Do you have the skill sets necessary to work effectively with a franchisor as well as your employees and patrons? After answering these questions yourself, consider asking friends and family for their truthful answers.

Another important question many aspiring business owners may overlook is this: Is there someone who is both willing and able to run the business should you become incapacitated by illness or anything else?

Business considerations Do you have previous experience in the industry of the franchise you wish to purchase, and, if not, have you considered working in this type of business before committing to buying a franchise?

You should conduct copious independent research once you have selected a franchise. You’ll want to look at things like the background and experience of the franchisor and whether the product or service you aim to sell has a market in your area. In addition to whether a market currently exists, you’ll want to consider what that market will be like in five years’ time. You should also research what competition—if any—exists in your proposed territory. Your research should include competing franchise and non-franchise businesses.

Other considerations You must perform the essential task of preparing a business plan for your selected franchise that details all your research and projections.

Keep in mind that you will need the help of other professionals such as a franchise attorney who can evaluate your franchise contract and—once you open your business—an experienced accountant who can help you maintain accurate financial records.

Information to obtain from the franchisor Once you become interested in a specific franchise, there is a wealth of information with which you should ask the franchisor to provide you.

For example, will your franchise agreement give you an exclusive territory for the length of the agreement, or will the franchisor be permitted to sell additional franchises in your area? Will you be given the right of first refusal in adjacent territories? You will need to determine whether the franchisor will sublet space to you or assist you in selecting a location for your franchise.

You should find out if you will be required to lease fixtures, signs or equipment from the franchise, and, if so, whether the prices are reasonable. You should ask whether the franchisor provides in-house financing and what the terms are. Additionally, find out whether any fees beyond those discussed in the offering circular are required of franchisees.

Consider what information you’ve received and how forthcoming the franchisor has been with that information. Have you been given data on actual, average or forecasted sales, profits or earnings? Have you been told the success rates of other existing franchisees, and was the franchisor willing to provide you with their names and locations? Refusal or reluctance to provide this type of information is often a red flag.

Once all of these issues have been addressed—and you still want to move forward—there are still more questions that you—as a prospective franchisee—should have answered:

For example, are there any variances permitted by the franchisor in franchise agreements. If so, what is their nature? You need to find out if you’ll be compensated for the goodwill you build into the business if you decide to sell your franchise back to the franchisor under the right of first refusal.

When you open for business, will there be any restrictions on what items you may sell, and, if so, what are they? You’ll need to find out whether you’ll be able to use any federally registered trademarks, service marks, trade names, logotypes and/or symbols that the franchisor may possess without reservation. If not, you should have a clear understanding of what the applicable exceptions and conditions are. You should also ask whether the franchisor owns patents or copyrights on equipment you’ll be using or products you’ll be selling. Additionally, find out whether any endorsement agreements with celebrities are in place for advertising purposes and what the terms of those agreements are.

Consider the franchisor’s reputation. Is it one of honesty and fair dealing? Has the franchisor met all the requirements of FTC and state disclosure laws? And, do you feel that the franchisor has investigated you thoroughly enough to be reasonably certain that entering into a franchise agreement with you will be mutually beneficial?

Final thoughts Of course, this is not an exhaustive list of research topics, and you may find that there are questions unique to your situation that need to be answered.

The bottom line is this: On the day that you sign your franchise agreement, you should feel confident that all your questions have been satisfactorily answered, and all your concerns have been adequately addressed.” - Franchise Gator
Have you considered franchising as a way to get into business?

This week’s Entrepreneur University comes courtesy of Bob Kelly. Bob counsels and writes for business, non-profit, government agency and association managers about using the fundamental premise of public relations to achieve their operating objectives. In this article Bob discusses how to make PR work for you:

“PR: Here’s What Works When it comes to public relations, what can work best for you as a business, non-profit, government agency or subsidiary manager, is doing something meaningful about the behaviors of those key outside audiences of yours that MOST affect the department, group, division or subsidiary you manage.

You confirm that success by helping persuade those key folks to your way of thinking, then moving them to take actions that allow your unit to succeed.

What you’ve actually done is apply public relation’s underlying premise. Namely, people act on their own perception of the facts before them, which leads to predictable behaviors about which something can be done. When we create, change or reinforce that opinion by reaching, persuading and moving-to-desired-action the very people whose behaviors affect the organization the most, the public relations mission is usually accomplished.

What you will soon come to see is that the right public relations planning really CAN alter individual perception and actually lead to changed behaviors among your key outside audiences.

You will do well to recall that your PR effort should require more than talk show tactics, special events and news releases if you are to receive the quality public relations results you believe you deserve.

The payoff for using this approach to public relations will soon be apparent: community leaders begin to seek you out; capital givers or specifying sources begin to look your way; new proposals for strategic alliances and joint ventures start showing up; politicians and legislators begin looking at you as a key member of the business, non-profit or association communities; welcome bounces in show room visits occur; customers commence making repeat purchases; membership applications begin to rise; and prospects actually start to do business with you.

You’ll want to be certain your PR people really accept why it’s SO important to know how your most important outside audiences perceive your operations, products or services.

Because they’re already in the perception and behavior business, they can be of real use for your new opinion monitoring project. But, most important, be sure they believe that perceptions almost always result in behaviors that can help or hurt your operation.

Also insure that a solid discussion with your PR staff takes place re: your plans for monitoring and gathering perceptions by questioning members of your most important outside audiences. Suggest that questions like these be asked: how much do you know about our organization? Have you had prior contact with us and were you pleased with the exchange? Are you familiar with our services or products and employees? Have you experienced problems with our people or procedures?

Please stay aware that it could cost considerably more to use a professional survey firm to do the opinion gathering work versus using those PR folks of yours in that monitoring capacity. But, whether it’s your people or a survey firm asking the questions, the objective remains the same: identify untruths, false assumptions, unfounded rumors, inaccuracies, misconceptions and any other negative perception that might translate into hurtful behaviors.

In all likelihood, you uncovered a few serious problem areas during your key audience perception monitoring. Because you now must call for action on the most serious distortions, you will have to set down your public relations goal.

Will it be to straighten out that dangerous misconception? Correct that gross inaccuracy? Or, stop that potentially painful rumor dead in its tracks?

An equally specific strategy that tells you how to get there is now called for. However, only three strategic options are available to you when it comes to doing something about perception and opinion.

Change existing perception, create perception where there may be none, or reinforce it. The wrong strategy pick will taste like crème anglaise on your bratwurst. So, be sure your new strategy fits well with your new public relations goal. You certainly don’t want to select “change” when the facts dictate a strategy of reinforcement.

Good writing becomes crucial when you realize that you have to prepare a persuasive message that will help move your key audience to your way of thinking. It must be a carefully-written message targeted directly at your key external audience.

Assign the task to your very best writer because s/he must come up with really corrective language that is not merely compelling, persuasive and believable, but clear and factual if they are to shift perception/

opinion towards your point of view and lead to the behaviors you have in mind.

How will you carry your message to the attention of your target audience? By selecting the communications tactics most likely to reach those key folks. There are many such tactics available.

From speeches, facility tours, emails and brochures to consumer briefings, media interviews, newsletters, personal meetings and many others. But be certain that the tactics you pick are known to reach people just like your audience members.

HOW you communicate your message can affect its credibility and fragility. Because of such uncertainty, you may wish to unveil your corrective message before smaller meetings and presentations rather than using higher-profile news releases.

In order to produce a comparison between opinion at the beginning of the program and now, you will need to begin a second perception monitoring session with members of your external audience. The need for such a progress report will cause you to use many of the same questions used in the benchmark session. But now, you will be on strict alert for signs that the bad news perception is being altered in your direction.

Should the program lose any of its steam and actually slow down, you can always speed things up by adding more communications tactics as well as increasing their frequencies.

What will have worked at the end of the day, are your efforts to marshall the resources and action planning you need to alter individual perception leading to changed behaviors among your most important outside audiences.

During which, you will have helped persuade those key folks to your way of thinking, and moved them to take actions that allow your department, group, division or subsidiary to succeed.”

Have you used PR to grow your business?