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Network Marketing For Beginners – How to Start a Small Business With 6 & 7 Figure Potential

Network marketing has been around for a long time as a business model, but few are really knowledgeable about how such a business really works. Many consider network marketing as a pyramid, i.e., “only the people at the top make all the money and the people at the bottom make nothing.” While there is some truth to this, there is hardly a company on the face of the earth where a brand new person, starting at the bottom, is making more than a person who has been productive at the top for some time. There is so much hype surrounding network marketing, that it is hard to dispel the myths from the reality of this form of business. For those of you who are considering it as a business opportunity, though, there are a few points that need to be clarified.

Firstly, network marketing is often called a “pyramid.” A “pyramid” is something where a person enters a business and immediately starts to make money just because he or she signs up. This could be likened to a chain letter. Network marketers make money legitimately in two primary ways. They can sell products like any other traditional business via retail orders, and number two, they earn money through the accumulated sales of all those who are in their organizations. The second form of income is by far the most lucrative in the long run, because it employs a “franchising” like principle of duplication. In traditional business, a store or shop earns income primarily from that one source. In network marketing, an individual can “franchise” out to other independent contractors, who in turn, can do the same. In this way, one person’s efforts are multiplied, for example, ten fold, a hundred fold or even a thousand fold, depending on the size of one’s group. No other form of business, save a franchise corporation can increase its revenue base in such a way. For the person who wants to invest little money, yet have the potential for earning a 6 and 7 figure income, network marketing may be the way to go. Check some of these companies out online and see if your interests and abilities fall in line with the values and philosophy of such a company. If so, maybe you will have found a business that is right up your alley.

The Most Effective Way For Small Business Owners to Spend Their Advertising Dollars

These days the single greatest challenge facing every small business owner is the economic recession. The simple fact is small businesses have been hit hardest by the recession. According to The Small Business Economy: A Report to the President produced by the U.S. Small Business Administration, “more than half of the 763,000 jobs lost in the first two quarters of 2008 were lost in small firms.”

This has made finding ways to spend money more efficiently and effectively paramount for a small business to remain successful. While most people will continue to talk about the damaging effects the recession has had on their business, a savvy business owner will recognize the recession as an opportunity to grow their business.

In the past 60 years America has been through nine recessions and recovered from every one. While it may sound strange to think of the recession as an opportunity, if the right investments are made you can easily increase your profits and outpace your competition.

That’s because during a recession most small business owners cut back on spending and especially on advertising. Yet, numerous studies have shown that this is a mistake. In a joint study done by Oregon State University and Western Oregon University dated April 19, 2009 they found that:

“Firms that are able to increase advertising during recessions are likely to have stronger future earnings.” The researchers studied data from five recessionary periods since 1971, sampling data from more than 3,000 firms listed on the public stock exchange.

Another study done by MarketSense compared 101 household name brands that increased ad spending during the recessionary period 1989-1991. For those who cut spending on advertising, it took 2 years after the end of the recession to regain their original position. By that time, aggressive competitors had almost tripled their market share, while less than 30% of those who cut advertising ever regained their market share in the following expansion period.

The question becomes how should a small business owner invest their advertising dollars? Many small business owners will turn to traditional forms of advertising such as: television, radio, newspaper or the Yellow Pages. The fact is however, that these forms of advertising are cost prohibitive and simply not as effective as they once were.

Reaching an audience through traditional forms of media is harder today then ever before. According to Arbitron only 1 out 3 three Americans read a daily newspaper, Ohio-based BIGresearch found that just 1 in 20 people actually watch television commercials. Bill Gates stated: “The Yellow Pages are going to be used less and less… These things always take time, but Yellow Page usage among people, say, below 50, will drop to zero – near zero – over the next five years.” As for radio, according to the Outdoor Advertising Association of America (OAAA) advertisers must buy deep (multiple stations and formats) to accumulate audience reach of over 50%, offsetting the cost effectiveness of radio if the target is a large, broad group of consumers.

Traditional forms of advertising are also cost prohibitive for a small business owner looking to reach the widest audience with a limited budget. Advertising in a regional or local newspaper for a 3 x 5¼ ad running twice per week for 52 weeks can cost as much as $792 a week. At those rates one year of advertising in the paper twice per week would cost $41,184.

A twenty six week sponsorship of a local news program with a thirty second spot running once a week and four additional thirty second spots, one in each locally produced sporting event (high school and college) would cost $2,000 per month. Meaning a twenty six week sponsorship would cost $11,000.

A 2½” x 6″ ad in the Yellow Pages for one year is $3,447.00. A half-page ad would cost $7,567.20 for the year. In the top 100 Radio Markets a 60 second drive time ad would cost $8.61 per 1,000 customers reached.

The most effective way for a small business owner to reach a large consumer base on a limited budget is a “non-traditional” form of advertising known as a vehicle wrap. A vehicle wrap is the marketing practice of completely or partially covering a vehicle in an advertisement or livery, thus turning it into a mobile billboard.

A vehicle wrap and fleet graphics is the most cost effective form of advertising that exists today. An average vehicle wrap is a one time fee of around $3,500. A wrap produced by a company with expertise and experience should last at least 5 years, that’s a cost of just $700 a year.

Studies have shown that vehicle wraps have numerous advantages over traditional forms of advertising. In a survey done by the Outdoor Advertising Association of America (OAAA) 96% of survey respondents said vehicle wraps method of mobile advertising is more effective than advertising through traditional methods. 91% of the people surveyed by the American Trucking Association (ATA) reported that they do notice words and pictures on vehicles. Add to that the fact that a vehicle wrap works around the clock, 24-7 and there is no tuning out, changing the station, or turning the page.

Vehicle wraps and Vehicle graphics also generate far more impressions for far less money then any other form of traditional advertising. According to the Traffic Audit Bureau for Media Measurement, a vehicle wrap generates anywhere between 30,000 and 70,000 impressions daily, that’s more then 11,000,000 impressions a year at a cost of just $0.77 per thousand impressions. The next closest form of advertising (billboard advertising) costs more then twice as much ($2.18) to generate the same amount of impressions.

There are additional benefits to purchasing a vehicle wrap as well. A vehicle wrap is a powerful visual message that will reach audiences of all ages, gender, backgrounds, income, profession and families and it will reach them where they are, with 96% of Americans traveling in a vehicle each week as either a driver or passenger.

Most small business owners are already commuting to work in their own vehicle while paying for ever increasing gas prices. Vehicle wraps and fleet graphics can easily offset this cost with the sales it generates. Studies have shown that the vehicle wrap has increased the sales of advertisement in the range of 107%.

If small business owners are looking for a smart investment in these tough economic times a vehicle wrap provides the perfect solution.

The Truth About Options For Loans For Small Business

The truth is revealed about options for loans for small business. The news suggests that the availability of external financing for small businesses has tightened or withered away completely. But this is not true.

SBA Business Loans are still available to companies looking to expand and can show a solid performance and longevity. Or if you are seeking start up business financing or a franchise loan, make sure the franchise has a good ratings. Knowing where to look for

If you are searching for SBA business loan, you should contemplate these options:

1. SBA 7(a) Loans. This program is for start up business financing and existing businesses, which is designed to help small businesses secure financing at reasonable terms through commercial lenders. To be eligible a company must be a small business as defined by the SBA and meet all requirements.

2. SBA 504 Loans. If you are purchasing commercial real estate for your business and are planning on occupying 51% or more of the space, than this is an option for you. SBA 504 allows a smaller down payment from the borrower which allows more reserve for cash flow. Usually the interest rate is competitive for the SBA portion of the loan, which is fixed for the entire life of the loan.

If you are seeking alternatives to SBA business loans, you should contemplate these options:

1. Securities Based Loan. This program provides terms based on its evaluation of the risk and future performance associated with your stocks, bonds, or US Treasuries that is pledged as collateral. This program allows you dual appreciation when the value goes up. Also the same number of shares that were pledged are returned to you when you pay back the loan and interest.

2. Self Directed IRA Loan. This enables the investment of your retirement accounts like your IRAs, 401(k)s, 403(b)s, Keoghs, SEPS etc., to be utilized either for the down payment or purchase of a business or franchise without tax penalties.

Borrowers need to discover all their options. Keep in mind that good companies are certainly going to make it through the tough times. Financing is available to small businesses that are in a healthy financial position. Entrepreneurs will need to stay agile during this time and be wise when it comes to finding extra funds for their businesses needs.