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Monthly Archives: May 2017

Realistic Business Goals

Some of the goals you may set for yourself and your business may involve how much money you’ll earn as the owner and how much money your company will make every year. You’ll also want to set the number of hours you will work each week and how many hours should be spent uninterrupted with your family. You’ll also want to forecast how many employees you’ll have, the number of customers you’ll do business with in your first years and the speed at which your company can comfortably grow. It will also be nice to set your age when you will retire to your very own island.

Writing your goals on paper actually helps you reach these goals. Once they are written down, you can always refer to them on a regular basis to help you keep track of your own program or change them as the situation calls for it. It also helps your staff stay focused on the truly important things for your company. As you begin your life as a businessman, writing down your goals becomes a top priority.

As you start setting goals, you will have to be as specific as possible. A lot of people simply want “a decent living”, but this is too vague. Instead, write down the exact amount you want to take in profits from your first and second years in business. The more specific you are, the easier it will become to design a plan that reaches these goals. For example, you can plan several ways to earn $50,000. You can now calculate the number of customers you will need to buy from you as well is how many employees you’ll need to hire to make the number of products you need to sell.

But what does it mean if you don’t meet the goal? That will depend on how much you’re off. If you exceed your goals, congratulate yourself. If you are a little behind profits before tax, then at least you still took home some money and you are doing something on the right path. Check your goals, set the next ones and move on. However, if after a year you’re in more debt than when you started out, it may be time to reassess your goals or even consider going back to your day job.

Many people start with a goal that is realistic and then they work backwards. They develop smaller goals along the way that helps them reach their target. It always helps to keep your feet on the ground. Be as realistic as possible when you set your business goals – write down the exact amounts in terms of profits, taxes, salaries and perks to get a near-accurate picture of what you’re dealing with. Be as optimistic as you can or you might get discouraged if you don’t reach most of your goals. It is always safer to set goals that you can win.

 

Myths of Drop Shipping

# Drop shipping means big money for little work

Running a business is a lot of work! Sure drop shipping saves you from warehousing, inventorying, and packaging and shipping items. But in the end, you’ve still got a retail business to run. Furthermore, profit margins are thinner because the drop ship supplier takes on much of the risk involved with warehousing the products.

# All drop shippers will be happy and willing to work with me

Some drop shippers will work with anybody. Those drop shippers will typically have a fee associated with them, or else their wholesale price is not as good. Other drop shippers have minimum requirements. For example, you may be expected to have several thousand orders per month.

Some drop shippers will even charge you a non-refundable application fee. If they decide you’re not big enough to work with them, you lose your application fee.

Of the more than 50 suppliers Doba works with, several have application fees, a few have monthly fees, and several more only agreed to drop ship for us because we promised them high volume, something we can do thanks to the combined purchasing power of our membership. Fortunately, Doba does not pass along any application or monthly fees, and you never have minimum requirements.

# It’s impossible to make money with drop shippers

It is true that your profit margins will be thinner, but some of the internet’s largest retailers use drop shippers exclusively as their product suppliers. If they weren’t making money, then they wouldn’t be some of the largest retailers on the internet.

Something that new entrepreneurs often fail to understand is that pricing is only one small part of business. If your focus is exclusively on price, then your business will never succeed because you’ll be completely ignoring the many other parts of business that are required to succeed.

I once sold a product in a very competitive market. The product had an average 10-15% return rate, and the mean price was $19.95. I sold my product for $33 and had a return rate of 5%. My website also had a conversion rate about 2-3 times that of my competitors.

Why was I able to sell my product for 65% more than my competitors, maintain a higher conversion rate, and yet still experience far fewer returns? Very simply, I chose to focus on all aspects of my business, rather than just one or two like so many of my competitors were doing.

# Drop shipping is the magic solution

Drop shipping is a specific service that fills a specific need. It is not a cure-all solution for business. Before jumping in, you should be sure that your business will benefit from drop shipping, and you should have a well laid out plan for making that happen.

 

Things to Look for in Your Business Credit Card Application

* Be cautious. It’s easy to get carried away with all the package benefits that are available. Keep in mind that this process is first and foremost about credit. As such, you only want those additional benefits that best serve your particular needs. For instance, if you rarely fly in the course of doing business, a credit card that awards you frequent flyer points doesn’t really serve you.

* Search for payment flexibility. Primarily, you’ll want to find a credit card with a “grace period” that works to to the advantage of your business. A “grace period” is the allowable time you have before the credit card company begins to charge you interest on new purchases. This period, when part of your benefits, often runs 20 to 25 days. Be aware, though, that grace periods are not the same for all credit cards. Most credit card companies will charge you interest immediately for new purchases unless you’ve paid off your previous month’s balance in full.

* Ask for the lowest interest rate available. Often, just by asking you can receive a lower rate. By keeping the interest rate low, you enable your business to use its funds more wisely on its immediate needs.

* Understand what extra benefits come as part of the credit card package, if you need the extra benefits or not, and if they come with hidden expenses. For instance, some cards come with free credit card supplements for employees. Benefits such as this can vary dramatically from one small business credit card to another, and so can the cost.