Every day around the world, numerous starry-eyed entrepreneurs in various locations begin anew. Starting a home based business can be an exciting and invigorating time and it can give you a new lease on life and your earning potential. But it can also be frustrating and painfully slow too.When things don’t happen as planned, or sales are harder to come by, the fun an excitement of starting a new home based business quickly fades away. And this is precisely the point at which many struggling business owners make the serious mistake of diversification. That is, they wander off their chosen path in search of riches elsewhere.Essentially, it’s a lack of focus and a lack of focus can be fatal to a new business venture. Shiny new objects and opportunities beckon, making it seem like these other options are far easier and more lucrative. It’s “the grass is always greener on the other side of the fence” syndrome.No question about it, this is a huge problem for anyone starting a home based business today — particularly online. If you subscribe to numerous newsletters and ezines, it’s likely that new offers, specials and discounts are being presented to you on a daily basis. The lures are attractive… the offers strong. But even taking the time to read and consider new product pitches is time that could be better spent growing your new business.Pay attention to the amount of time you spend opening emails and checking out other websites and blogs. Do you find yourself looking at other methods, techniques and promised “solutions” regularly?If you’re willing to monitor your time for just one week, you’ll likely find the major culprit is a lack of focus. Sometimes it’s difficult to admit it because it means accepting responsibility. Also, ongoing learning should be part of the process for every single entrepreneur in the game. But where the trouble lies is in jumping into something completely different because it seemed like the right thing to do.When starting a home based business, you need to be vigilant. Do your research – yes. Create a simple business plan – yes. But you also have to launch into action and stay the course.Considering other options at this point is futile. Remain focused and work your plan. You’ve got to giveyour new home based business a fair shot.Nothing is accomplished by diversifying your interests at this early stage. Once the seed has been planted, you need to nourish it and created an environment in which it can grow. But starting a home based business one week, then trying a different “program” the next, is self-defeating. It’s like digging up the seedling before it has time to root.
5 Great Reasons Why You Should Start an Online Home Based Business
Whatever your reasons are for starting an Online Home Based Business, I can assure you that you are taking a step in the right direction. It could be that you are fed up struggling through life paycheck to paycheck. Or you may want to be your own boss. Well read on and I will outline a list of the five great reasons that I truly enjoy about my Home Based Business, and you can too.Great Reason # 1 This is my favorite. You get to be a full time parent to your kids and at the same time earn a lucrative full time income. When I reflect back on my life over the years. All those years when I was working on average of sixty five hours per week. Leaving the house at 4:00 am every morning and getting home maybe around 6:00 in the evening. It;s obvious that I truly missed a lot of quality time with my two sons as they were growing up. Now of course I worked hard and was a good provider, and I was a good Dad when I was around. But take it from me there is no greater you can give your kids, than your time.Great Reason # 2 The beauty of an Online Home Based Business is that there is no cap as to how much you can earn. Now with a regular job, no matter how much time and effort you put into it your earnings are limited. There are many successful Home Based Business owners earning $10,000 monthly or more.Great Reason # 3 You do not need experience to get started and be successful. As a matter of fact when I started my Home Business I did not even know how to use a computer. But just like anything else in life, if you have the burning desire to do something, you will learn and do whatever it takes. In fact in this industry you will have the top earners teaching and coaching you on everything you will need to become successful in your Online Home Based Business.Great Reason # 4 You are the boss.The CEO. The President of your company. You make the decisions, good or bad. Of course being the boss means that you are responsible for the success of your business.Great Reason # 5 Starting your Home Based Business on the Internet is actually pretty cheap. If you compare it to the high cost of starting up a regular store front business where you would have to take out a huge loan to get started.So there you have it. If you are ready to take ACTION then I would like to invite you to visit http://meetalfredsimkins.com to learn more about lucrative Home Business opportunities.
3 Tips For a Successful Home Based Business
It is exciting and liberating to have a successful home based business. When time and effort are put into growing a successful home based business, the rewards are great. There are three areas to consider when mapping out a successful business plan. Learning from your peers, searching for a business that has much to offer without inventory headaches and lastly, promoting yourself.1. Speaking to other home based business owners. Ask what businesses have worked for them. There are many online opportunities but research must be done and questions must be asked in order to know which home based businesses they have found success with. Finding out what roadblocks they have encountered and how they were overcome is important so the same issues can be avoided. Formulating some questions before speaking to others can guide you on a path to success.
2. A “No Inventory” business. A great home based business to consider is one with no inventory to buy and no monthly or quarterly sales quotas to maintain. Who wants to stockpile inventory just to show friends and family or drag to vendor shows? Also, business opportunities that compliment the “green movement” are a plus. Not only are green products helping the environment but with some online business opportunities there are some incentives for going “green” as well.
3. Promoting yourself. There are many ways to promote yourself through online media. Social networking/network marketing sites offer different avenues to market yourself, which are mostly free. Make sure you setup a complete profile when you register with these sites so others who are interested in what you are posting can get a more complete picture of who you are and what you have to offer them. No post is complete without interesting signature lines that draws people in and want to click on your link.A home based business takes planning and determination. Before you get started there are some aspects of a home based business that should be considered in order to be successful. Someone new should not feel alone when starting out. Some basic tips such as who to talk to, what kind of business and where to go from there are important areas to research before committing.
Starting a Home Based Business
There are so many benefits to starting a Home based business. Firstly the costs will be lower, there are no travel expenses and you can work in the comfort of your own home. Technology becomes more advanced each year, which means that it is easier than ever to run your business from home. Of course there are many legal issues to take note of, and pitfalls to avoid.Remember This IS a Business!Numerous home businesses fail because the owners don’t have the self-discipline it takes to work for themselves. Although you will have more freedom running your own business, it is still a business at the end of the day and needs to make money. Having set working hours and good head for business are two of the most basic skills you will need when starting out.Depending on the type of business you are setting up, a huge start up capital is not a necessity. There are plenty of web-based ventures that cost very little, and providing you have sufficient computer skills, can be highly lucrative. If you choose to start up an Internet company, it should be treated exactly like any other business, regarding the amount of effort you put in and the legal issues involved.Is Your House Suitable?Before you even entertain the idea of starting a home based business you will need to establish if you neighborhood is zoned for home-based businesses? Some municipalities do not allow home businesses at all, whilst others have strong restrictions on them. If you set up a business without ensuring it is legal then you are asking for trouble. It is best to check the zoning bylaws in your area before doing anything else.Secondly how suited to a business is your home? You will need a decent amount of space for all the equipment and paperwork. Do you have a room you can dedicate to your business? If clients will be visiting your home it needs to look professional and presentable. It is also essential you have an area free of distractions such as pets or other household members.LegalitiesWhen you are starting a home-based business, the legalities become your responsibility. Firstly you will need to decide whether you business is a sole proprietorship, partnership or corporation and then register your business name.Depending on what sort of business you have, you made need a business license. There are many resources online that can provide you with further information on this.Finally you must run your business according to provincial and federal laws, and that includes registering for workers compensation insurance.Starting a home-based business may be daunting and seem incredibly complicated. However there are free, government run organizations that will give you advice and guidance. Anyone can start up their own business, with the freedom to work for themselves and the potential to earn a much higher income. There is nothing stopping you from taking your future career into your own hands and starting a home-based business.
Top Small Business Owners Payday Question – How Do I Pay Myself?
Business owners are hard-working and dedicated. They put in probably sixty plus hours a week. It is natural that they want to get paid for their time that they pour into their small business. Unfortunately, if it is a new start-up company, it probably isn’t making enough income yet to see a payday. If the business has been in operation for a while though, the bank balance might be increasing each month as profits start to accumulate.So, how do business owners get paid? Are they considered employees?Well, the answer to the question above is – it depends. Clear as mud, right?It all depends on how the small business is legally setup and recognized by the Internal Revenue Service. Most businesses that are relatively new are small enough that they are operating as sole proprietors or as a partner in a partnership. That means that they haven’t incorporated under state law.There is good and bad news when a small business is operating as a sole proprietor or a partner:
The good news is that payday for the business owner can be any day they feel like paying themselves as long as there is enough money in the bank. They just simply write themselves a check. They aren’t considered an “employee”, because they are a “one-man-show” running the business. The Internal Revenue Service sees the owner and the small business as one entity.
The bad news is that they are not recognized as an employee and no federal taxes are being withheld from their pay. So when April 15th comes around and it is time to file the income tax return, the owner may owe quite a bit of self-employment tax on the profits of the business. That is why owners should pay quarterly self-employment taxes throughout the year if they think they are going to owe at least $400 or more in tax.
If the small business is recognized as a corporation or S corporation, it needs to set the owner up as an employee of the company and pay them a set salary or wage that is similar to what other organizations pay a person with the same skills. Payroll taxes will be withheld from the owner’s pay just like any other employee.As an S corporation, the owner can also make draws or distributions if the business is making a profit, but no tax is withheld from these payments and it is best to talk with a tax advisor before doing so. There are limitations as to the amounts that can be taken out of the business account in this manner.Hopefully this has answered the question of “How do I pay myself?” It can be tricky determining what the rules are regarding paying the owner of a small business. Consulting with a Certified Public Accountant is always a wise decision when setting up procedures for the organization.
Heathrow Airport Hotel Guide For The Leisure Traveller
Heathrow Airport London is the busiest international airport in the world. Around 35% of its passengers are transit passengers, i.e. passengers that are just using London to make connections.
Just one reason why there are nearly 40 airport hotels at Heathrow serving the local demand for overnight stopovers.
For many of these hotels the businessman with an expense account is their bread and butter. This article seeks to address the leisure traveller, providing a guide to getting value for money locating a bed at Heathrow.
We’ll start off by dividing the hotels into three categories.
There are the large 4 and 5 star chain hotels like Hilton, Radisson and Sheraton aimed at the businessmen, typically charging $US200 during the week, half that at weekends.
Then there are the 2 and 3 star hotels, again mostly chains, like Comfort Inn, Ibis and Premier Travel Inn, aimed at the leisure traveller and the businessmen on a budget. These will typically charge just over $US100 during the week, about $US75 at weekends.
Lastly, there are the small independent local hotels, mostly family owned who offer cheap ‘bed and breakfast’ style rooms. These have the cheapest accommodation.
Room rates can seem good value, especially at weekends when the businessmen are away and everyone deep discounts to fill beds. However, beware, what the hotel doesn’t get in room rates they’ll try and get out of you in other ways.
There are no hotels in the central passenger area where Terminals 1, 2 and 3 are located, though there is a hotel linked to Terminal 4 on the south side of the airport – the expensive Hilton Hotel, not for most leisure travellers.
This means a bus transfer, and unlike most international airports there are no complimentary hotel transfer buses. The airport authority provides ‘Hoppa Buses’, mid-size buses that run every 10-20 minutes on fixed routes to Heathrow Hotels. At 3 GBP per person per journey, thats an extra $US20 for a couple staying at a Heathrow Hotel.
Most hotels will charge anything from $US10-$US30 for breakfast, and at most hotels there isn’t viable competition outside the front door. Dinner is similarly expensive and entertainment is largely limited to an expensive bar.
So, tips for the leisure traveller trying to economise.
Look for a hotel on the Bath Road, this is the northern perimeter road of Heathrow Airport and the main hotel strip.
Public buses run more frequently than the Hoppa Buses along the Bath Road into Heathrow Terminals, and they’re free. (The fees from the Hoppa Buses are part used to subsidise the free local buses).
The Bath Road is the only location where you can escape your hotel. There is a pub serving meals, 2 McDonalds, a bowling alley, a small supermarket and an Italian Restaurant that can provide breakfasts, snacks and meals on the Bath Road. There are also 24 hour public buses running to local towns Kingston and Hounslow for entertainment.
Taking the above together, the benchmark for the leisure traveller is the Ibis and Premier Travel Inn hotels.
The other local option is to consider local Bed & Breakfast hotels. These do not provide an airport transfer but many are on the periphery of the airport on a bus or underground route. Their room rates are similar to the budget hotels but this includes a hearty breakfast and the transfer is still cheaper than the Hoppa Bus.
One other option is to forget Heathrow altogether and overnight in Central London. The Heathrow Express takes just 15 minutes to London’s Paddington Station and there is lots of cheap accommodation around the station. You’ll certainly have a more entertaining evening in London than at an airport hotel, and at a similar overall price.
Social Media for Small Businesses
Social media has become an integral part of our day-to-day lives. Businesses of all size and shapes have started making the most of available mediums. Today we will try to anatomize tips on social media for small businesses. There are a plethora of small businesses eyeing social medium to promote their business/services. However, majorly these small businesses are failing or not being able to make optimum use of social media for their business growth. There are many theories and strategies on how to effectively use social media for established brands, but the topic social media for small businesses is seldom addressed. According to Digital state of eMarketing India 2017 Octane Research:
60% small businesses promote their business on social media. 50% focus on SEO and 35% use multichannel marketing funnel.
70% small businesses consider content strategy as their primary marketing activity.
52% business owners are using social media as to efficiently address customer engagement.
More than 20% of business owners said that they are making 50% plus profit using social media.
The primary reasons for the low turnout are uncertainty on an application of social media, calculating return on investment and persuade employees/stakeholders to clinch social media. Hence it is important to address the elephant in the room and analyze how beneficial is Social media for small businesses.
Social media for small businesses is a great way for emerging businesses to generate lead and build a reputation. If regularly updated, social media can deliver more results as compared to traditional mediums. Social media for small businesses gives brands an edge of control over the content that they want to post. Also, since social media is a two-way dialogue process, it helps businesses to instantly identify what is benefitting them. Social media for small businesses also helps generate Word of Mouth, which is one of the best tools for emerging businesses.
Social Media for small businesses | 10 Tips to effectively use Social Media
Define your Target Audience
The first and foremost important part that small businesses should focus on is to define their target audience. This helps small businesses to device their social media strategy accordingly. The target audience should be defined basis age group, sex, location, users’ online behaviors, their likes, interests, and preferences. For niche products, business owners can even target users based on their birthdays, anniversaries and important milestone. Audience targeting plays a very crucial role in the outcome of the results. For e.g.: a local shop selling footwear should not target users with interest in entertainment. The shop definitely won’t get the desired results.
Set achievable goals
Overnight success is a myth. Small businesses must understand this basic fact. Generally, when a new business starts selling on social media, there is palpable excitement is achieving more than set targeted sales. Businesses need to set goals which are upwards and forward. To achieve enormous goals, small businesses start updating social feed with multiple updates in shorter duration. This leads to user’s disinterest in the product/service. The set goals should be in sync with brand’s core capabilities and expertise. For e.g.: if a business is into selling shoes, they shouldn’t set a goal to repair maximum shoes in their area.
Choose the right medium
By now everyone knows, social media is for free. Even paid campaigns can be conducted at a relatively low cost as compared to traditional mediums. It is in this scenario, that we often see small businesses jumping the bandwagon and creating profiles on all the available platforms. Creating social profile doesn’t hamper brand image, but aggressively promoting a brand on wrong platforms can lead to brand losing its potential customers. Hence it is advisable for SME’s to first identify the right platform through which they can maximize their business. For e.g.: If a shoe selling brand tries to aggressively sell on LinkedIn, they won’t get a plausible response as compared to promotions on Facebook/Instagram.
Promote your core product/services
Since each and every business is riding in the social media wave, it is important for a them to promote their core product/services. Nowadays, we see a lot of businesses promoting their services as well as promoting peripheral products/services, which revolves around their core product/services. Majority of the times, this SME’s doesn’t have capabilities to fulfill a requirement, which can lead to a bad word of mouth for their business on social media platforms. Let us go back to our example; if a shoe seller is trying to aggressively promote socks instead of shoes, it is not going to benefit the business in the long run.
Create quality content
Now that we have covered the topics of identifying the target audience, setting achievable goals, choosing the right medium and promoting the right product/services let us now take a look at the type of content a business should promote on their social pages. A business should always focus on creating good quality content rather than not-good quantity content. Even if the business updates their page once in a day as long as it is relevant to their business, advocates about its core products send across a clear message it is considered as a good quality content. Antagonistically, if a business posts multiple updates which aren’t even relevant to the business’s products and services leads to users considering the business as fake/spam. Also, new businesses should try and refrain from promoting other businesses on their social platforms initially.
Create a content calendar
Making a small business successful on social platforms is no small task. It takes a lot of efforts for the businesses to keep up their conversion ratio. One such effort is to create a content calendar. Small businesses must anticipate important events and create a content calendar accordingly. Ideally, a content calendar must be planned a month in advance but an even weekly content calendar is highly recommended. This helps businesses to avoid any last minute hassles, strategize much more effectively and it also helps in creating curiosity amongst its loyal fans/customers.
Test and re-test
Social media is highly unpredictable. The content a business posts today, might not work for tomorrow. Hence, small businesses must always test their content before publishing it on their pages. Testing content also applies to the platform a small business chooses to promote. Small business owners must always don the consumer’s hat before posting about any product feature, updates, schemes or offers. A consumer’s perspective is the key when testing the content that has to be uploaded.
Look for inspiration
Small businesses must always look for inspiration from a competitor who is successful in the same category. Copy pasting competitors idea or content is not the answer. Small businesses must look for the kind of content its competitors are putting up and derive their own strategies subsequently. Inspiring content/stories always make a business to strive to create their own content that is appreciated by one and all. It helps in increasing brand consideration, brand visibility thereby increasing conversions for the business.
Calculate ROI
Even a small promotional budget is not justifiable if there is no mechanism to calculate its return on investment. It is more important in case of small businesses. It is very important for a small business to keep a tab on the budgets allocated to any promotions and the subsequent ROI related to it. If a certain promotion is not doing well or the business is not getting desired results, the brand custodian can always look for other platforms to generate quality conversions.
Analyze and Re-strategize
There can be umpteen instances where a particular campaign/promotion might not work for a business. That doesn’t mean that the promotion is wrong or the product/service is not good. Doing an analysis of the campaign is as important as setting the objective. This helps the business to formulate their upcoming strategies in more effective ways. At the end of every campaign, brands must note down the learning’s from that campaign and identify if the content/idea was appreciated by their fans or not. This helps businesses to skip the non-performing updates from future communications.
The Finer Points of Internet Auctions
WHAT IS A PENNY AUCTION?
Penny auctions have exploded in popularity with the massive growth of the internet. However, few people know the true origins of penny auctions.Beginnings actually stretch back to the Great Depression. Those were hard times for everyone, but even harder for farmers. Farmers struggled to bring in steady income because of droughts and crops not selling as well as they had previously. As a result, the banks would foreclose on the farmers who couldn’t keep up with their mortgage payments.
The banks weren’t satisfied with just repossessing the house, they wanted to raise as much capital as possible, so they resorted to selling off the possessions of the owners of the repossessed houses. There was not much the farmers could do about it so they began bidding ridiculously low prices, pennies, on the items while threatening others who dared to bid higher than a few pennies.
The auctions of today hardly resemble their tremulous beginnings. Being part of a penny auction today is exhilarating, fun, and addictive. It combines the selling format of auctioning with a little bit of chance factored in.Auctions are a game of strategy but also a game of luck.
The premise behind penny auctions is giving people the chance to win an item at a drastically reduced price.Auctions make that possible by spreading out the cost of the product among multiple bidders. In order for a person to take part in an auction, they must pay a set price for each bid. For example, if a person wanted to bid on a fifty dollar Amazon gift card then he would spend a dollar for each time a bid placed. If he ended up winning the gift card, then he would only have spent a few dollars for a fifty dollar gift card. Usually penny auctions sell bids in packages.
HOW PENNY AUCTIONS WORK!
The main foundation of penny auctions is the pay-per-bid format. It is the key that allows bidders to win items at the fraction of their retail value and allows the auction owners to keep their site profitable. Most y auction sites run on the same premise: people pay a set amount for each bid, whenever a person places a bid within the closing seconds of the auction time will be added, the last person left with a unique bid after the clocks runs out will win the item. There are a large variety of items that can be won, but they tend to be popular electronics or gift cards to popular stores.
There are two types of auctions: lowest unique bid auction and highest unique bid auction. Lowest unique auction sounds confusing but it is actually quite simple. A unique bid is when only one person has a bid at a certain price. Bids usually start at one penny, a bidder can then place a bid at two pennies. Until another bidder places a higher bid, the most recent bidder will be the lowest unique bid because that was the only bid at two cents and nobody bid higher. However, penny auctions generally don’t stop at one penny. It is not uncommon to find auctions that end up at a couple hundred dollars based on the popularity of the item being auctioned. However, the same principles apply for those auctions. Highest unique bid auctions follow the more traditional auction format such as eBay. The person with the highest bid at the end of the auction wins the item.
Auction site owners turn a profit by selling bids. Say twenty people are bidding on a ten dollar gift card at one dollar per bid, at the end of the auction if there were twenty bids placed in total then the site owner would have made twenty dollars with a ten dollar profit.Auctions do seem like a win-win situation:The site owner makes money while the bidder gets an item for dirt cheap. However, not everyone wins in penny auctions. The people who paid one dollar each bid but left with nothing to show for their investments will not be so happy.
HOW TO WIN!
Penny auction has a lot of chance mixed into it, but one can incorporate strategy that will help raise the chances of winning. Playing smart can make all the difference between gambling and auctioning.
The first crucial tip to winning penny auctions is to know how to manage your bids. Your goal should be to win as much as possible without spending a ton of money buying bids. Managing your bids means that you should already know how much you are willing to risk in order to win an item. The amount of capital you are willing to risk will determine how many bids you can use. Once you know how many bids you have to spend on an item, then you will be better able to manage how and when you place a bid. That will keep you from blowing away all of your bids in the first few seconds of the auction.
The next tip is to practice time management. When fighting in the trenches of penny auctions, you have two enemies: other bidders and time. Knowing when to bid is a must if you want to have success. Placing a bid when there is a lot of time left on the clock is never a good idea. You have to remember that the key to winning a penny auction is being the last one standing when the clock runs out and that each bid increases the amount of time left. It would be a good practice to wait until the last few minutes of the auction before you begin to bid.
The final tip for successful auctioning is to keep your emotions under control.Auctions have a lot of similarities to gambling, and just like gambling, your spending can get out of control. If you keep your emotions level, it will keep you from making rash decisions and blowing loads of cash. Keep your mind clear so that you can gage the behavior of the other bidders and outsmart them.
HOW TO AVOID SCAM SITES!
Penny auctions are a great addition to the web whether you want to win an item that otherwise you wouldn’t be able to afford or if you simply enjoy the thrill that comes with bidding in auctions. Unfortunately, scam sites have tarnished the reputation of the legitimate penny auction sites. However, there are ways that you can protect yourself from scamers and enjoy your auctioning without having to worry about losing your money due to dishonesty.
Checking the reputation of the auction site before you start spending your hard earned money is always a good idea. Chances are other people have tried the site before you and some of them have left reviews. The reviews are your way to gage whether a auction site is trustworthy or not. If a site is getting overwhelmingly negative reviews, then that is a clear indication that you should steer your business elsewhere.
Another tool you can use to protect yourself is checking the Alexia ranks of the auction sites. Alexia rank will give a solid view of how much traffic the auction is getting. If you see a huge difference in the amount of traffic Alexia is projecting and the amount of active bidders on the site, then warning signals should be ringing in your head. Some auction sites have been known to set up robots that automatically bid on projects in order to keep the auction going and inflate the price. That is known as shill bidding. You can sniff out those sites by comparing the traffic the site should be getting to the amount of users using this site.
CONCLUSION!
New legislation may come out later down the road that will officially make penny auctions gambling, but until then, it is a fun, exciting auction that allows one to win the item they’ve always wanted but couldn’t afford.Auctions are also quite lucrative for the site owners because of the pay-per-bid strategy they’ve incorporated. Penny auctions had humble beginnings with farmers who just wanted to get back at the banks who kicked them out of their house. More recently, auctions have enjoyed an explosion in popularity with the rise of the internet.
There are two main formats fora auctions, lowest and highest unique auction, however they both run on the same premise where the last unique bid wins the item. Winning a penny auction will require a certain amount of mental tactic and a bit of luck. However, you can increase your odds of winning by practicing certain techniques such as managing your bids wisely, learning how to work with the time, and keeping a level head and your emotions under control. When you combine those three strategies to your bidding plan, you will find that you win a lot more often.
It is important that you do your due diligence to protect yourself when participating in auctions. Not every auction is run by honest and trustworthy people. There are people out there who just want to take your money. You can protect yourself by ensuring that you only bid on sites that already have a very positive reputation from real users.
How to Find Great Live Auctions for Resale Items
Hi, my name is Walt. I’m an auctioneer with 25 years of experience in the auction business and licensed in the state of MA. I own Quick Auction Service, a company that specializes in building and running custom auctions, I’m also the webmaster of my own site and have been on eBay for 8 years. Besides eBay, the types of auctions I run most frequently are antiques and on-site estate auctions, although I’ve run everything from business overstock auctions to charity & special event auctions.
I enjoy sharing my knowledge and stories of the auction business. My goal for article is to help folks get the absolute most out of their auction experience.
Whether your fresh out of the package or a seasoned dealer I think I can offer something in this article to help you with your auciton adventures.
There may be as many reasons to attend auctions as there are types of auctions to attend. Maybe you want to attend an auction to buy items for re-sale on eBay, or some other market. Maybe you want to furnish your home with wonderful antiques, or you want to furnish your home as inexpensively without sacrificing quality.Some folks are just looking for a fun night out. With a little perseverance all these things are possible.
There are antiques and estate auctions, auto auctions, overstock auctions, absolute and no reserve auctions, real estate auctions, specialty auctions where only one genre of items are sold, tailgate auctions, live auctions, online auctions, sealed bid auctions, silent auctions, charity and fund raising auctions and many more.
Can you really buy for pennies on the dollar at an auction? You bet! Many times I’ve seen folks buy and re-sell at the same auction on the same night for a good profit, although be advised, this should only be done after the auction is over.
There are a lot of ways to find an auction, but here are some tips on how to find and attend the best ones.
Visit the genre of shops in the area that apply to the type of auction you want to attend. IE: If your looking for a good antique auction to attend, stop in the local antiques shops and ask for what there are for good auctions in the area. Sounds obvious right? But listen to what they don’t say as well as what they do say. Oftentimes when a dealer speaks poorly about an auction he or she attends, it may be likely that they are trying to keep a good thing secret. Think for a moment, why would a dealer keep attending a lousy auction?
Newspaper ads: I personally like to find ads in the classified ad section rather than flashy display ads. Flashy ads are usually indicative of an auction that will be high priced, may have reserves, (a set price on an item), and usually an enormous crowd. While any auction can be profitable to attend, it is usually best to steer clear of the glitzy ones, at least for the beginner.
Here’s the minimum you want to find out before you go. If there is a phone number in the ad, call and ask for the terms of the sale. What forms of payment do they accept? Is it an absolute auction? An absolute auction is one that has no minimum or reserve bids on items. These are the best auctions to attend! Is there a buyers premium? A buyers premium is like a tax that everyone who makes purchases at that auction must pay above the winning bid price. Most auctions these days do charge a buyers premium, 10% is not unreasonable but I feel much more than that is greedy, and the auctioneer that charges over 10% is counting on most bidders not doing the extra math as the bids quicken in pace.
A fair auction will have ample time to inspect the merchandise, usually at least 2 or 3 hours. Find out when inspection starts and make sure to attend! Never attend an auction if you can’t make the inspection, not unless your prepared to gamble. Most auctioneers sell at a rate of about 100 items per hour, which is why they sell “as is”. They simply don’t have the time to give a detailed description of all the items. Since almost all items at auction are sold AS IS, there are sure to be some damaged, refinished, fake and incomplete items at any given auction. Beware of any auctions that offer very little or no inspection time.
Good auctions will usually have 150 to 400 lots. A lot may be one item or a group of items. The exception to this are specialty auctions, auto auctions, real estate auctions etc.
When you attend your first sale, take note of the 1/2 dozen or so dealers that buy the most often. See if you can find out about other area auctions they attend.
When you do find an excellent auction, attend it as often as possible. By frequenting good sales, you help increase the bottom line of that business. It’s difficult for many auctioneers to keep the quality of merchandise consistent, so good attendance certainly helps. And when an auctioneer gets to know you as a buyer, he/she will go out of the way to accommodate you, to keep you coming back.
Hiring An Auction Company
Estimating your assets value:
Typically, one of the first questions a business owner will ask me is, “how much will the assets bring at an auction”. After taking the time to review the assets, the auctioneer should give the client a conservative estimate of the sale based upon his experience and the current market trends. It is important that the company give realistic expectations so the seller can make informed decisions based on their best interest.
Compensation and Expenses:
Is the company you are considering working for you or against you? The agreement you decide may determine this.
A business owner should carefully consider how the auction company is compensated. The most common commission structures include: straight commission, outright purchase of assets, guaranteed base with a split above to both auctioneer and seller, guaranteed base with anything above going to auctioneer or a flat fee structure.
In a straight commission structure, the company is paid an agreed upon percentage of the total sale.
In an outright purchase agreement, the auctioneer simply becomes your end buyer. The company purchases your assets and relocates them. While this can be an option in some unique situations, keep in mind that they will want to purchase your assets at a very reduced price to make a profit at a later date.
In a minimum base guarantee, the auction company guarantees the seller that the auction will generate a minimum amount of sales. Anything above that amount either goes to the auction company or split with the seller. While a seller might feel more comfortable doing an auction knowing that he is guaranteed a minimum amount for his sale, keep in mind that it is the best interest of the auction company to secure a minimum base price as low as possible in order reduce their financial liability to the seller and secure higher compensation for the sale.
In a flat fee structure, the auctioneer agrees to show up for the sale and call the auction. There is no incentive for the auctioneer to get the best prices for your assets. The auction company is compensated regardless of the outcome of your sale.
What is the best option for business owners? In my experience, an agreed upon straight commission structure. This puts the responsibility on the auction company to offer the best outcome for everyone involved. There is an incentive for the auction company to work hard for both parties, set up and run a professional sale, get the highest bid and sell every item on the inventory. Successful auctions translate to a higher bottom line for both the seller and the auction company.
Auction Expenses:
In most auction agreements the expenses to conduct an auction are passed to the seller. If the auction company pays for the expenses, it is simply absorbed in higher commission rates.
All expenses should be agreed upon in advance in a written contract. Typical expenses will include the costs of advertising, labor, legal fees, travel, equipment rentals, security, postage and printing. A reputable auction company will be able to estimate all expenses based upon their experience in previous auctions. An agreement should be actual costs charged as expenses, not an estimated amount.
Advertising is typically the highest cost in conducting an auction. The auction company needs to set up an advertising campaign that will promote the sale to its best advantage and not overspend to simply advertise the auction company.
Once the auction is complete, the auction company should provide a complete breakdown of all expenses to the seller, including copies of receipts within the auction summary report.
Buyer’s Premium:
What is a buyer’s premium? If you attend auctions regularly, you are very familiar with this term. The auction company charges a fee to the buyer when they buy an item at auction.
The buyer’s premium has been around since the 1980′s and is standard auction practice. It was first used by auction houses to help offset costs of running brick and mortar permanent auction facilities. Since then, it has spread to all aspects of the auction industry. It is prominent in online auctions and allows auction companies to cover added expenses incurred from online sales.
It is the responsibility of the auction company to provide clear disclosure of the buyer’s premium to both the buyers and the sellers. Those not familiar with auctions are often taken back by the buyer’s premium. They looked upon it as an under handed way for the auction company to make more money. Reputable auction companies will provide full disclosure within the auction contract, advertisement and bidder registration.
Typically, an auction company will charge online buyers a higher buyer’s premium percentage than those attending an auction in person. Extra fees are incurred with online bidding and are charged accordingly to online buyers. This provides the seller a level playing field for both online buyers and those attending the auction in person. Without the buyer’s premium, there is no way to do this.
Pre-Sales:
We’ve all been there. We’re looking forward to attending an auction only to find that some items were sold prior to the auction date.
As an auctioneer with over thirty-six years of experience, I can honestly state that pre-sales will hurt an auction. When a company decides to liquidate their assets, it is easy to sell off high-end pieces of equipment through online sources, equipment vendors or to other businesses. The seller receives instant cash and avoids paying a commission to an auction company.
Auctioneer’s find themselves appearing to acting in a self-serving capacity when potential clients say they are planning to sell off parts of their inventory prior to an auction. It’s hard not to consider the auctioneer’s commission when they warn you not to pre-sell anything. Yes, the auctioneer wants to earn a commission on those sales but it is more important that the auctioneer protect the sale from potential negative backlash that comes from pre-selling. The buying public knows when an auction has been “cherry picked” prior to the sale and it reflects in their bidding. It becomes a sale of “leftovers” and that impacts prices.
A buyer who purchases prior to the auction usually does not attend the sale. They already bought equipment at a good price with no competition. If they do attend the auction, they tend to let others know of their great pre-sale purchases which again, impacts prices and the overall excitement of the sale.
It is important to understand that auctions work best with a complete inventory. You want competition on your higher end equipment. The easy to sell items make it possible to gain respectable prices for hard to sell items.
When a business owner decides to liquidate their equipment assets, there is only one opportunity to do it right. Hiring a reputable auction company will assist you with a professional, orderly and timely liquidation.