Below we will look at some common personal-finance mistakes that young startup owners make and of course how you can avoid them:

Over-investing

A common mistake young entrepreneurs often make is that they spend their business savings too freely and even worse, they often do this to look more professional. They tend to overspend on things that aren’t absolutely necessary, such as office supplies (nice desk for example) or on electronic gadgets. There is even a group that spend all their startup money before they even have a product or service to sell. You better spend your money on making a good product or service. Spend your money on building your business, not on things you don’t directly need to do business.

Cutting Corners

Young business owners often try to cut corners, for instance on legal and accounting advice. In the long run this can backfire, so hire an expert in the specific field that you need. For example an accounting mistake that is often made, is paying too much personal income taxes.

Not Paying Yourself

A common mistake that is often made is that young entrepreneurs don’t pay themselves a salary. They tend to mix personal and business finances. Don’t to this! Keep your personal and business finances separate. Give yourself a realistic salary and leave the rest in your business so it has enough to operate.

Plan for the Worst

Young people often think that they can take on the whole world or that they are bullet proof.
This is the same for young business owners and you can see it in their business planning. They tend to plan to optimistic instead of planning for the worst.

Mixing Business and Personal Assets

A lot of young business owners mix their personal assets with the business assets. For instance they rely on personal credit cards to front money for business money or even worse use business credit cards to buy things for personal use. They forget what will happen if the business ever gets audited?

Another example is that they often get loans from parents, family or friends, especially in the startup phase. They forget that the business could fail and that those people could lose their money.

Up and Downs

A lot of young entrepreneurs forget that business will know high and lows. Some months you will outsell even your own expatiations and the next month you could sell nothing! Often in those months where they sell a lot they become overconfident and they start spending the business cash indiscriminately. Instead of building a buffer for those low sale months. A lot of young startup owners have drained their business in this way.

Original post by MoneyAside.com

Common Money Mistakes Young Business Owners Make

How to change those odds, so your business will survive that hard first years? Here are some tips you should take to improve the odds:

Talk to Customers

This is important for every business, but is especially important for startups. Doing the market research will help you (the business owner) to avoid mistakes or at least detect the mistakes before they are made. Something’s to look for are: is the business being done in the right market and are your products marked at the right price.

Location

Whether you need to pick a retail location or a website domain name make sure it is easy to find and accessible by potential customers. Also the name of your business should match your business and should be easy to remember.

Keep Expenses Down

Every business needs a cash buffer in case it needs to react at changing markets or other business related circumstances. This is especially true for startups, so try to keep expenses down. Try to save or reserve a certain portion of the profits to build a cash buffer.

Analyze your Startup

You need to make time each week/month to analyze how your business is doing. We know time is hard to find, especially in the startup days, but it is very important to know where your business is heading. Without this knowledge it’s hard to make the right business decisions.

Planning for Problems

By creating a cash buffer for your business you are already planning for problems, but you can do more. Try to create possible problem scenarios and try to make a plan on how you will react in those circumstances. For example: what will you do if business is slowing down? Or what will you do if a certain product isn’t selling as expected? Or what will you do if a product took off and you can’t keep up with production?

These are some lessons we’ve learned, so how did you get your business through the first year(s)?

Share your story in the comments!

Original post by MoneyAside.com

5 Tips to Survive Your Business Startup First Year

A great benefit of creating a zero-based budget is that you are forced to look current state of your finances, because you have to assign each dollar of income to a category. Although sticking to the routine can be hard the first few months, if you stick with it you’ll notice that your mindset will change over time, from casual spending to one of deliberate spending.

Three Category Types

Before we start you need to know the category types and the differences between them:
Fixed categories – payments that you have to make or can’t easily be changed. For example a mortgage payment.
Static categories – payments that look fixed, but you can change them, for instance by canceling them. For example Netflix or golf course membership.
Variable or Fluid categories – payments that can be different each month. For example entertainment.

Creating a Zero Based Budget

1. Start by listing ALL your source of income. This means that you need to list all of your household income and not only a paycheck, also investment dividends, bank interest, etc.

2. The next step is listing all your expenses. Usually this is the hardest step, because you need to find all the expenses you pay each month. And this can be a real eye opener!

Also you have to remember that some expenses aren’t paid monthly, but also quarterly, semi-annual or on annual basis. Make a category in your budget for quarterly and annual payments and break the amount into monthly payments. This way you put money aside (open a separate saving account for this money) each month, until it’s time to pay the quarterly or annual bill.

Make a category for all your expenses (mortgage, taxes, insurance, retirement fund, car payments, clothing, household, entertainment, savings and so on.) Make sure you find them all, but don’t make the category’s to general. With this I mean that you don’t put everything little thing under the same category, example groceries will fall under the household category, but clothing should not fall under household. Also the opposed is true, you don’t want to have for example 100 separate categories. Your categories should be balanced.

3. The next step is to allocate income for all your fixed expenses. Fixed expenses are those payments that you have to make or can’t change for example mortgage payments.

A gym membership is not a fixed expense, because you can cancel the membership and train in the park! See the difference? These expenses will fall in your static categories.

4. Try to make adjustments to fixed or static expenses. This way you’ll have more money for your fluid categories. For example you make fixed payment for your families insurance, maybe you can get a better deal somewhere else.

I know, I know, changing your insurance will take time, so you can’t adjust it right away. You don’t have to do this right away, you can create your budget first (by making the adjustment that you can do now) and after you have made the adjustment you change your zero based budget.

Another thing, you don’t have to cancel everything, if you have enough income. But if you cancel things because you have to then make sure that you also need certain things for the quality of life. With this I mean the following: if you really like your gym membership then try to find something else you can cancel.

5. Start allocating to fluid expenses. This can be a hard one, so make an educated guess if you have to. Use what you think is a reasonable amount.

6. Zero your budget. Now that you have all you income, expense and categories start playing around until each dollar is assigned to a category. Add more money to savings or discretionary balances or some other category. (If I where you, I would put additional money in the saving category or retirement fund.)

7. Now the hard part, sticking to your budget. Track all your spending during the next month and stick to your budget. At can be hard in the beginning, but if you stick with it, it will become easier each month and it will pay dividends down the road.

At the end of each month you can make minor adjustments, but you have to make sure you reach zero.

Original post by MoneyAside.com

Building a Zero-based Budget

• If you have a steady flow of income then you are in luck. If you are a salaried person check whether your job offers raises or overtime payments. Make the most of all the extra money making opportunities at work.
• A part time job always works. Devote a few hours at nights or on the weekends and earn some extra bucks. During summer you can certainly make extra money by mowing lawns, and around Christmas, you can easily work a few extra hours in retail. Since these jobs are short-term, they won’t interfere much with your regular job in any way. You can look for a temporary or seasonal position at a department store or a grocery store and raise cash to pay off your debts.
• Look around intently and gather excess items which you no longer use. By selling them on eBay.com and craigslist.com you can always make some quick bucks . If you are not a fan of e-business you can always conduct a yard sale or a big rummage sale at your house during the summer.
• If tax season is coming up fast and you are about to receive a pretty decent tax refund then you can easily repay your debts by using a portion or all of the funds you get back from the government
• If you can curtail unnecessary expenses and save well you will be left with more disposable income which can be further devoted towards your debt repayments.

Follow the above mentioned ways and eventually get rid of your debt problems with ease.

Original post by MoneyAside.com

5 ways to make money and combat your debts

Join a Freelancing Site

A good way to find clients to write fore is to join one (or more) freelance sites out there and start as a freelance writer. Most of them have a large list of writing jobs or associated work such as copy-editing or translating on their site. But remember only submit bids on subjects you’re interested in and don’t take to much jobs at once, so you can always provide the best service to the clients you’re writing for. (Clients that love your work will build your status on these sites and their good feedback will influence how many bids you’ll win in the long run!)

Portfolio Blog

This one is a must for every freelancer that wants to make money online, a portfolio blog. A portfolio blog is nothing more than a blog with some of your best work on it. Write some articles (use subjects that you know well and want writing gigs in) and post them. You have to make sure that these are unique good articles and not just some pieces you have lying around. These articles must reflect your work, so potential clients can see your writing style and potential. Link to your portfolio site whenever you can. (And please, don’t forget to place up to date contact information on your site.)

Build a Network

To get a steady stream of writing jobs, it is very important to network (or to build a network.) You can use professional networking sites such as Linked-In to keep in touch with you network. Make sure your profile (CV) is up to date at all times. Also keep in touch with old clients and/or colleagues.

Make Guest Posts

Another good way to get potential prospects and build a network is to write guest blog posts. Make sure that the guest blog subject is a subject you are comfortable writing about. Always provide a short bio at the end of the post with a link back to your portfolio blog. These way potential clients can contact you if they want.

These are just some easy ways to start your online writing career and to start making money online. (And don’t forget to create multiple stream of income!)

If you know of some additional ways to start out as a writer than don’t hesitate and leave a comment below!

Original post by MoneyAside.com

How to Make Money Online Writing

Announcements

Whenever your business launches a new product or a new feature in a service, you should write a announcement on your blog. Try to combine it with some lucrative promotional offer (for example reduce pricing for a short period), so people will come back to your blog on a regular basis for new features or good deal. (Also don’t forget to tweet your announcement.)

Benefits and Features of your Products

Try to talk about your products and services and do it in a positive tone, so people become exited about your products or services. Point out the features of products and try to point out the benefits for the consumers.

Tutorials

Try to write some tutorials about your products, this way you can help new customers to learn your products or services. People like to read great tips about products they own and they will come back to your blog for more great tips. Also let them comment on your tutorials, so you can hear what people like to read about (free feedback on your products and services.)

Related Tips

Some times it is possible to use certain product or services with your businesses products and services. If this is so, make some blog posts about it. People love to read tips and tricks about the products they own.

Related News

Write about new things in your industrie or about related industries. This helps you to make your business blog more informative and also people will come back more often (more general news to read about.)

These are just some things you can write about on your business blog and remember the more interesting stuff you put on you business blog, the more people will come back. Blogging is an easy and inexpensive way for your business to connect with customers.

Original post by MoneyAside.com

Business Blogging – What to write about?

In a small business you (the small business owner) and your management staff are making most of the decisions. But ultimately you are the one that usually held responsible for all the decisions that are made. This can create a great deal of pressure, especially in hard times. But you have to remember that you are not alone, that’s why you hired other managers in the first place — to help you run the business and making it in to a success — together!

So what to do? Why do many beginning business owners fail? What things are preventing your business from growing?

Management Staff

The first thing that you have to remember is that not all business owners and managers have the skills or experience to deal with all problems. Take a closer look at your management staff and you’ll see what I mean. Some managers for instance are good with people and others know the ins and outs of what is done on the work-floor. What I mean is that every manager has it’s own kind of skill set and if those skills don’t complement yours, you need to do something about it.

Of course, you can take drastic measures and fire the managers that has the same skills as you, but a better way is send them to seminars or a course to learn new and better management skills (and of course those skills that you think your business needs.) (Sometimes seminars can help you to come-up with new business ideas.) Also you need to tell them that you want him/her to learn certain skills and that you think it will help them to become a better manager.

Another good way is to advice certain books that teach them better management skills. You can only do this of course if you read the books yourself and that is the other point I want to make, you need to keep learning yourself, because in the end, you are responsible for all business decisions!

Lack of Finance

Another internal area that could prevent the business from growing is a lack of finance. In most cases a business need certain funds to expand, for instance the business needs more capital for better equipment, more supplies or even more staff. Once that you are convinced that a lack of funding is the problem, look for external sources of finance. But you need to be really convinced that this is the problem, because also managers have to habit of trowing more money at a problem!

Lack of Focus

Another area that could prevent your small business from growing is a lack of focus. Every business , including the small, need some sort of focus strategy. With a focus strategy I mean a short-term goals, long-term goals and a plan on paper to implement these goals.

The best thing to do is writing a plan (one or two sheets should be enough) with your management staff (and if it’s a very small business, with all your employees) that is setup like so:

• Short-term goals
• Long-term goals
• Implement plan (what things need to change)
• Some measuring dates (to see what goals you have reached and to see which things you need to change (again) to reach the goals.)

Product or Service

Another thing that could hinder the business from growing is a poor products or services. Or simply that there’s no demand for the products or services. These things in itself are not that bad. Don’t get me wrong, they aren’t good for the business either or are easy solvable, but it are things you can do something about.

The thing I want to talk about is what we call small business owner tunnel-vision. This is a problem we see over and over again and its very hard to detect for every small business owner.

Example: You have worked so hard on your product or service. At some point you begin to think that its the best product/service out there and that everybody can’t live without it. But after two months, the sales are very low and the customer responses are no good.

The response of most business owners is that they say that the problem is not their product or service, it was probably their marketing campaign or something else. And they immediately try to fix the problem or even worse throw more many at the problem.

They have such a firm believe in their businesses product that they can’t see that the problem is the product or service. We have seen business owners go in bankruptcy before they would admit that the product was the problem.

So remember, sometimes the problem of no business growth is simply a bad product and the best thing to do is to cut your losses and try again from the start.

Original post by MoneyAside.com

Don’t Prevent Your Own Small Business Growth!

What is an affiliate program?
Let’s first look at what affiliate programs are. Many companies which sell products online provide an affiliate program. For them it’s a simple and cheap way to advertise their products. If you sign up for a companies affiliate program the company will give you a special link to their products (or landing page) and in most cases some promotional material, such as banners, graphics and sales text (some provide a complete page, just cut/paste and you’re done).

You then build your own page on for instance your website/blog and place the special links on that page. Now if someone clicks on the link and buy a product from the company you earn a sales commission, thus you make money online.

(Note: with the special link I mean nothing more than a HTML link to a landing page. In most cases the link is tacked with a label so the people that run the affiliate program can see from where the user came. They need to know this, because they need to know who to pay.)

Know that you know what affiliate programs are, let’s look at the ‘why’ you should choose affiliate programs as a way to make money online with.

Almost No Cost
In almost all cases you can join a affiliate program for free (and I would even say that you should avoid programs where you have to pay money for. You want to make money not paying money, right?)

And there are more reasons why it’s cheaper than starting your own business online:

• No expenses to manufacture products you want to sell.
• Almost know administration hassle.
• If some program doesn’t make enough money you move on to the next affiliate program.
• After the initial setup, you can add more affiliate programs to your site. (More change to make a sale.)
• No product storage or shipping products.

And the list can go on and on.

In most cases the only thing you pay is your time. (Time to setup the page and time to promote.)

As you can see it’s much cheaper to use affiliate programs to make money online with than starting your own business. The only thing you have to do is to choose one of the different types of affiliate programs that is right for your website/blog and your on your way!

Original post by MoneyAside.com

Affiliate Programs to Make Money Online

1. General Rule

Before we give some example of products we start with the general rule when to buy. You should buy when demand is low or supply is high. For instance: clothing is cheaper when it is “out of season ” (demand is low). Certain fruits are cheaper when they’re “in season” (supply is high.) This is the general rule you should remember is you want to save money on your purchases.

2. End of Season

In most cases you can find good deals at the end of season, because the retail businesses inventory is usually ahead of the actual season. Which means that they buy early to be ready for the next season and this means that “out of season” product get cheaper, because they want to get rid of their “old” inventory before this season is over. Example: winter coats in January and February (they are getting ready for the spring/summer sales.)

Some other examples: sporting goods at the end of a certain sport season. Swimsuits in September. Gas grills or patio furniture after Labor Day. Chocolate and flowers after Valentine’s Day. Christmas cards in January. End so on.

3. Old Inventory

Retail business always want to get rid of their “old” inventory. Some examples when this “old” inventory becomes cheap: furniture in July and white sales in January.

4. Back to School

Of course you can find some good deals during the back-to-school retail blitz in August, but certain things (for example clothes such as jeans) you can buy cheaper in September and October. Another thing to do is to buy certain school supplies in bulk and at the end of the season when they are on sales. (For instance buy enough paper for two school years.)

5. Electronics

For electronics you have to remember this rule: electronics become cheaper when the new models come out. And the good thing is that in most cases there is almost no difference between the older and new models. So why not buy the “old” and cheaper model TV, computer or cell phone and save some money.

6. Shoes

Buy sneakers in April or November.

7. Weddings

You might dream of a June wedding but a winter one might mean more cash for the honeymoon.

8. Grocery Shopping

Store sales often start on Wednesday but coupons to match some sales don’t come out until the Sunday newspaper circular. Stacking coupons with sales leads to the best deals. Also in some stores a lot of items go on sale a couple of hours before the week ends.

9. Vehicles

Always buy a car after the new model has come out. In general you can save 15 to 20 percent on previous year’s models. Remember that a lot of salespeople need to make certain quotas at the end of the month, so this is a good time to buy a car.

This are just some examples of timing purchases to save money. Please leave a comment if you can think of other examples.

Original post by MoneyAside.com

Time your Purchases to Save Money

1. Focus on repeat customers

Bringing in new customers is of course vital to a new business, but keeping your old customers is even more important. Why? You’ve already put in the time and money to get those customers, so keeping them is very important.

2. Focus on profitable customers

A lot of entrepreneurs make the mistake of chasing after any business they can get (even if it costs a lot of time and has a little profit.) You should focus on the profitable customers who will spend a lot. Always focus on the “ideal” customer for your type of business.

3. Focus on cash flow

You should work out how much revenue you need every day to make a profit right from the start. Knowing how much money comes in and goes out on a daily basis will help you to determine sales or marketing budgets. Making a cash-flow statement each week will help you tremendously in your business building efforts.

4. Focus on what’s working

As a start-up owner it’s easy to focus on many different things, even on the once that doesn’t work. Beginning business should be flexible about moving to what works and what makes the most profit. Don’t try to sell or do things that the market doesn’t want, especially in the first two years of business start-up.

5. Focus on productive time

The first year of business start-up you should put at least 75% of your day in the making-money end of the business. You should trying to make a sale and to market your product, rather then sitting behind a desk.

6. Focus on customer service

In number 5 we said that you should focus on making money, we know that customer service only cost money and time, but it’s important that you customers are happy, because a happy customer is a repeat customer. So a portion of your daily time needs to go to customer service.

7. Focus on hiring the best

Always hire the best person you can find to expand your team. You should never settle for the best of a bad bunch. OK, hiring the best can cost you more, but such people will be well worth the price. These people will help you in building a successful business.

8. Focus on quality

You should always focus on quality with everything you do. Never go for quantity instead of quality. An example: We rather have 25 great customers than 100 average ones.

Original post by MoneyAside.com

Things to Focus on at Business Startup