Statistical Benefits of a Home Based Business Versus Traditional Job

We’ve all grown up listening to instructions on how to live the American Dream: go to school to get a good education, get a good job working for someone else, and you will be taken care of, and have a nice retirement plan in your golden years. Is this ‘American Dream’ still in place?As of the Summer of 2010, unemployment rate has been just under 10% (though REAL unemployment is estimated 20%). The Obama Administration is stating that the 8.5 million jobs lost will probably never come back. Health care coverage is so bad that people actually want the government to run it! And Social Security is expected to run out by 2018.The following are statistics detailing the plight of the average American family:
• Taxes – for four months and a week, or 3 hours out of every 8-hour day, you’re working for Uncle Sam – (The average American family of four with a median income of $47,012 will pay $10,250 in federal taxes and another $6,110 in state and local taxes for a total “tax liability” of $16,36
• average childcare costs – $7000 per year
• higher standard of living – make more/spend more – Average American spends $1.22 for every dollar they earn
• gasoline – $1200 per year
• spend hundreds on dry cleaning and biz wardrobe
• eating out for lunches $2000
• auto insurance – $500
• costs of raising a child – (quarter million $ to raise child birth-17) ($17,000 for 1st yr)Does working for someone else equate to the American Dream or the American Nightmare? Due to these disturbing economic factors, more people are seeking different opportunities for generating income, and starting a home based business is a popular alternative. After all, why work to generate revenue for someone else when you could do this for yourself?According to IDC, a top national research firm, there are between 34.3 million and 36.6 million home office households in the United States alone generating over $427 billion dollars of revenue. To put this dollar amount into perspective, $427 billion is more than the medical industry, the food industry, and the medical drug industry combined. In fact, the Small Business Administration estimates that more than half the businesses being started in this economy are home based or online businesses. And this trend is expected to continue due to low start up costs and higher success rates.The following are some statistics about home based businesses:
• About 70% of home-based businesses will last over a three-year period, compared to 29% of other business ventures, according to the Home-Based Business Institute.
• 89% with household incomes greater than $80,000 have a home office compared to 14% of those with incomes below $25,000 (Find/SVP).
• According to IDC, home-based businesses create an estimated 8,500 new jobs daily, or one new business every 11 seconds
• Over 85% of small business owners still have their small business 3 years later, which is a much higher success rate than the traditional brick and mortar business.For some people, working from home may be a method of supplementing their ‘real-world’ income, and for others it may be the only way to work because of other responsibilities or lack of other opportunities. In any case, work-from-home jobs provide you the luxury of working at the time you like, while staying close to your loved ones.Online marketing is one of the most popular work-from-home jobs. A wide variety of products are sold online using different marketing techniques, such as online social media marketing and pay-per-click marketing. Online marketing is also one of the techniques that can help you earn enough to take care of your everyday needs, monthly bills and more.A word of advice: find a topic that you are passionate about, find out if the industry is successful, and focus on that item. For example, I have always enjoyed buying and selling gold and silver coins. Who doesn’t like collecting money?! The industry for numismatic coins is booming. The numismatic industry does more than $10 billion dollars of business in North America alone, and also that 9,023,500 American Silver Eagle coins were sold by the US Mint in the first three months of 2010. The worldwide numismatic business is well over $100 billion. Therefore, focusing on a rapidly growing industry that I have a passion for makes perfect sense and has lead to great financial success.The trick is for you to find out what your passion is and focus on that industry.

How To Avoid Falling For A Home Based Business Opportunity That Is Not Real

With the unemployment rates what they are as of late, quite a few people are considering the concept of looking for a home based business opportunity. There are various things that you are able to do in your own home which are valid businesses, however you will also find plenty of people online looking to get you to fall for a scam.An effective way to avoid falling for the traps of scammers is always to keep in mind that you should never be forced to pay to work. Don’t ever in your life believe job adverts that assure you probably will make thousands of dollars a month but first needs you to submit a “starting up fee.” Scammers do this as their own full time job and try to make money off of trusting people who are only looking for methods to make money.You should never be required to spend money to begin with a job. There are a few genuine things that expect you to spend money up-front including inventory products, or to create website hosting and items like that. If you come across some form of advertisement for a home based business opportunity you must never ever need to mail them money. Not surprisingly, if it’s a genuine money-making opportunity, they wouldn’t demand your money.In case you are questioning precisely what it is that you’re able to do from home you will find options. First, you should consider what you love to do. To make it fairly simple, begin with creating a list of things you find irresistible to do and have the capabilities to undertake. Some examples of this can be writing, web design or managing an ecommerce internet site.Stuff like freelance writing or web design could be an extremely successful home based business opportunity which doesn’t demand any startup prices. If you have some capital to start out, you could possibly elect to acquire some inventory and commence selling it through your own web page or by utilizing online auction web sites or e-commerce websites that permit independent sellers.Prior to deciding to dig in too much make sure you ask yourself if perhaps you might be a excellent prospect to work from home. Working from your home takes a great sum of constraint, drive and focus. You simply won’t have an irritating supervisor ordering you around, and this can be incredibly nice, but it can certainly be challenging to stay focused on your job.If you have a tough time working hard without regular motivation it’s possible you have a hard time working in your own home. Being your own boss appears easy enough but that doesn’t always end up the way it is. However, should you be adamant about running a home business then by all means give it a try.You can definitely find that you take pleasure in carrying out something so much that it will not possibly seem like you’re working. That may be one of the finest approaches to earn money from your own property. The really hard part is identifying what you will really do at home to generate money. It’s actually a lot easier to keep a clear head when you find yourself creating wealth doing something that makes you happy.

So You Want to Start a Home Based Business? These 3 Keys Will Relieve Frustration

Home based business ownership can be attractive for many reasons. Just the thought alone of spending more time with family, being removed from the daily commute and working without a boss are just a few reasons so many people have been inclined to start a home based business. Perhaps the number one reason people today choose to start a home based business is financial.More people work from home today than ever before. The lure of working from home can be attractive to almost anyone. Opportunities in the network marketing arena have proven to be a boon to countless people. With the explosive growth and limitless income potential of the internet there is now another industry ripe for the taking. A person simply must find a niche and exploit the opportunities.There are however some things that the potential home based business owner must consider prior to venturing off into this new frontier.1) Work. Work. Work. Despite the claims of many, these are not get rich quick businesses. There is no magic potion. Like any other traditional business the home business owner is going to have to work. In some cases you may find yourself working harder at home than you ever would have for someone else. While working from home has its advantages there are also pitfalls. Distractions can be overwhelming. We may find ourselves doing busy housework rather than productively working on our business.2) Train. Train. Train. Finding a success mentor is crucial to the success of the new home business owner. With any new endeavor we are much better off if we take the advice and counsel of successful home business owners who are willing to help us to succeed.3) Persevere. Persevere. Persevere. The challenge to succeed is great but the payoff for those who succeed far outweighs the challenges we are faced with along the way. Chances are good that difficult times will come in pursuit of your goal. The key is to persevere through the difficulties and press forward. As difficult as it may be to swallow, you may even fail the first time out. Take what Mickey Rooney has to say about failure to heart, “you always pass failure on the way to success.”So you want to start a home based business? Incorporating these three keys into your thought process and action plan, will help you avoid becoming one of the 97% of home based business owners who fail.

The 3 P’s Of Home Based Business Success

Home based business success is being achieved by people all across the globe. It is fascinating to see folks of all different kinds of backgrounds beginning and running their very own successful home based business.It is thrilling to know that in spite of your present financial circumstances you can still be successful with your own home based business. It doesn’t matter how many years of schooling you have either.Gender does not seem to make very much difference. There are numerous examples of both women and men making as much money as they want with their own business and doing it at home.Single men and women are successful. Married people often work their business together. Some people do it part-time. Other folks do it full time. Even retired persons are now finding success with a home-based business.In this article we would like to discuss what I call the 3 P’s of home based business success. These are three things you need if you are planning to work at home and turn your business into a successful one.1. Product. What exactly are you going to sell? Thanks to the Internet there’s no end to the type of items you can sell on the web.Some Internet marketers choose to sell a service such as website design, blog writing, or being a virtual assistant. In this case the product is the service itself and you will never run out of Internet marketers who will pay you to do things for them.Information is very popular online right now. You can make money helping people solve their problems. You could make even more money should you help them save time.There are plenty of digital info products you can sell as an affiliate marketer by joining programs at Amazon and ClickBank to name two.Niche marketing is another way to be successful with your home business. One niche that never runs out of prospects is people looking to start their own home-based business.Offer home business opportunities to this niche and you can help a lot of individuals in addition to becoming successful yourself. There are lots of home based business opportunities such as this online.You may have a product of your own you want to promote. As long as there is a interest in what you’re selling you can make money and get it done from the comfort of your own home.2. Promotion. Marketing your product online stands out as the difference between succeeding and failing.You can have the greatest product in the world, but if no one knows about it you are not going to make any money. The quickest way to achieve this is to use the Internet for both paid and free advertising.Pay per click advertising is a quick way to be on page one of a search engine for keyword phrases regarding the theme of your business. Google AdWords and Yahoo Marketing are 2 of the leading PPC advertising programs.Ezine marketing is another method to reach a targeted audience with paid advertising. Doing social networking ads with sites such as Facebook remains one more approach to reach your target audience.There are plenty of methods to market on the internet if you have a budget. You do not even have to spend a lot of money when you first begin.You might want to look at free advertising techniques such as article marketing, blogging, and other forms of social media. Some people advertise their products through free classified ad sites.To get a much better idea of methods to promote online visit discussion forums such as the Warrior Forum and find out what’s working in today’s marketplace. This is a free discussion forum to join and offers lots of excellent information.3. Persistence. If you believe in the home based business product you are promoting you just need to stick with it. Success can be yours if you are prepared to consistently work at it and never give up.Follow these 3 P’s of home based business success and you may join thousands of other people who are already using the Internet to effectively work online from home.

Tips to Secure Your Small Business Network

Just because your business is small, doesn’t mean that hackers won’t target you. The reality is that automated scanning techniques and botnets don’t care whether your company is big or small, they’re only looking for holes in your network security to exploit.Maintaining a secure small business or home network isn’t easy, and even for an old hand in IT, it still takes time and energy to keep things locked down. Here are 10 of the most critical steps you can take to keep your data from ending up elsewhere, and none of them take much time or effort to accomplish.

Get a Firewall

The first step for any attacker is to find network vulnerabilities by scanning for open ports. Ports are the mechanisms by which your small business network opens up and connects to the wider world of the Internet. A hacker sees an open port to as an irresistible invitation for access and exploitation. A network firewall locks down ports that don’t need to be open.A properly configured firewall acts as the first line of defense on any network. The network firewall sets the rules for which ports should be open and which ones should be closed. The only ports that should be open are ports for services that you need to run.Typically, most small business routers include some kind of firewall functionality, so chances are if you have a router sitting behind your service provider or DSL/cable modem, you likely have a firewall already. To check to see if you already have firewall capabilities at the router level in your network, log into your router and see if there are any settings for Firewall or Security. If you don’t know how to log into your router on a Windows PC, find your Network Connection information. The item identified as Default Gateway is likely the IP address for your router.There are many desktop firewall applications available today as well, but don’t mistake those for a substitute for firewall that sits at the primary entry point to your small business network. You should have a firewall sitting right behind where your network connectivity comes into your business to filter out bad traffic before it can reach any desktop or any other network assets.

Password Protect your Firewall

Great you’ve got a firewall, but it’s never enough to simply drop it into your network and turn it on. One of the most common mistakes in configuring network equipment is keeping the default password.It’s a trivial matter in many cases for an attacker to identify the brand and model number of a device on a network. It’s equally trivial to simply use Google to obtain the user manual to find the default username and password.Take the time to make this easy fix. Log into your router/firewall, and you’ll get the option to set a password; typically, you’ll find it under the Administration menu item.

Update Router Firmware

Outdated router or firewall firmware is another common issue. Small business network equipment, just like applications and operating systems, needs to be updated for security and bug fixes. The firmware that your small business router and/or firewall shipped with is likely out-of-date within a year, so it’s critical to make sure you update it.Some router vendors have a simple dialogue box that lets you check for new firmware versions from within the router’s administration menu. For routers that don’t have automated firmware version checking, find the version number in your router admin screen, and then go to the vendor’s support site to see if you have the latest version.

Block Pings

Most router and firewalls include multiple settings that help to determine how visible your router and/or firewall will be to the outside world. One of the simplest methods that a hacker uses to find a network is by sending a ping request, which is just a network request to see if something will respond. The idea being if a network device responds, there is something there that the hacker can then explore further and potentially exploit. You can make it harder for attackers by simply setting your network router or firewall so that it won’t respond to network pings. Typically, the option to block network pings can be found on the administration menu for a firewall and/or router as a configuration option.

Scan Yourself

One of the best ways to see if you have open ports or visible network vulnerabilities is to do the same thing that an attacker would do – scan your network. By scanning your network with the same tools that security researchers (and attackers) use, you’ll see what they see. Among the most popular network scanning tools is the open source nmap tool). For Windows users, the Nmap download now includes a graphical user interface, so it’s now easier than ever to scan your network with industry standard tools, for free. Scan your network to see what ports are open (that shouldn’t be), and then go back to your firewall to make the necessary changes.

Lock Down IP Addresses

By default, most small business routers use something called DHCP, which automatically allocates IP addresses to computers that connect to the network. DHCP makes it easy for you to let users connect to you network, but if your network is exploited it also makes it easy for attackers to connect to your network. If your small business only has a set number of users, and you don’t routinely have guest users plugging into your network, you might want to consider locking down IP addresses.The benefit of assigning an IP is that when you check your router logs, you’ll know which IP is associated with a specific PC and/or user. With DHCP, the same PC could potentially have different IPs over a period of time as machines are turned on or off. By knowing what’s on your network, you’ll know where problems are coming from when they do arise.

Use VLANs

Not everyone in your small business necessarily needs access to the same network assets. While you can determine and set access with passwords and permissions on applications, you can also segment your network with VLAN or virtual LANs. VLANs are almost always part of any business class router and let you segment a network based on needs and risks as well as quality of service requirements. For example, with a VLAN setup you could have the finance department on one VLAN, while sales is on another. In another scenario, you could have a VLAN for your employees and then setup another one for contract or guest workers. Mitigating risk is all about providing access to network resources to the people who are authorized and restricting access to those who aren’t.

Get an IPS

A firewall isn’t always enough to protect a small business network. Today’s reality is that the bulk of all network traffic goes over Port 80 for HTTP or Web traffic. So if you leave that port open, you’re still at risk from attacks that target port 80. In addition to the firewall, Intrusion Prevention System (IPS) technology can play a key network security role. An IPS does more than simply monitor ports; it monitors the traffic flow for anomalies that could indicate malicious activity. IPS technology can sometimes be bundled in on a router as part of a Unified Threat Management (UTM) device. Depending on the size of your small business network, you might want to consider a separate physical box.Another option is to leverage open source technologies running on your own servers (or as virtual instances if you are virtualized). On the IPS side, one of the leading open source technologies is called SNORT (which is backed by commercial vendor Sourcefire.

Get a WAF

A Web Application Firewall (WAF) is specifically tasked with helping to protect against attacks that are specifically targeted against applications. If you’re not hosting applications within your small business network, the risks that a WAF helps to mitigate are not as pronounced. If you are hosting applications, WAF in front of (or as part of) your Web server is a key technology that you need to look at. Multiple vendors including Barracuda have network WAF boxes. Another option is the open source ModSecurity project, which is backed by security vendor Trustwave.

Use VPN

If you’ve gone through all the trouble of protecting your small business network, it makes sense to extend that protection to your mobile and remotely connected employees as well. A VPN or Virtual Private Network lets your remote workers log into your network with an encrypted tunnel. That tunnel can then be used to effectively shield your remote employees with the same firewall, IPS and WAF technologies that local users benefit from. A VPN also protects your network by not letting users who may be coming in from risky mobile environments connect in an insecure fashion.

The Economic Importance Of The Home Based Business Industry

DEFINING THE HOME BASED BUSINESS

The home based business can be defined as a business whose primary office is in the owner’s home. The business can be any size or any type, as long as the office itself is located in a home.

In the USA, there are about 6.6 million home based businesses that generate at least 50% of the owner’s household income.(a)

“If one advances confidently in the direction of his dreams and endeavors to live the life he has imagined, he will meet with success unimagined in common hours.” – Thoreau

ESTIMATES OF THE TOTAL SIZE OF HOME BASED BUSINESS

“One study has estimated that the total number of people who run or are employed by home based businesses in South East England is in excess of 250,000 people, equivalent to 7% of the working population of the region.(c)

“While the average home entrepreneur business has two employees (including the owner), 39% have between two and five employees, and 10% have more than five. Using these average employment numbers, Emergent Research estimates that home entrepreneur businesses currently employ roughly 13.2 million Americans, including the owner.(a)

“To put these figures in perspective, let’s compare them to U.S. employment generated by two important industrial segments: venture-backed firms and the oil and gas industry. Analysis by the National Venture Capital Association shows that companies that received venture capital backing including such corporate giants as Intel, Microsoft, and Apple – employed 10.4 million in 2006.”(a)

THE IMPACT OF THE DEVELOPMENT OF THE INTERNET ON THE ECONOMY AND HOME BASED BUSINESS

The development of the internet has been and will be the big driving force in the development of the internet related home based business. Let us have a closer look at these developments. The following information is extracts from the McKinsey report.(b)

Two billion people are connected to the internet. This number is increasing by about 200 million per annum.
Almost $8 trillion exchange hands each year through e-commerce.
About one-third of small and medium-sized businesses extensively use web technologies.
The web has made possible new waves of business models and entrepreneurship. It has transformed industries.
The internet accounts for 3.4% of the GDP of the 13 countries that was part of the study. These countries represent 70% of the world GDP. The total contribution of the internet to the world economy is $1 672 billion or 2.9% of the total GDP.
The internet accounts for 6% of the GDP of countries like Sweden and the UK.
Over the past 5 years, the internet has contributed 21% of the GDP growth of the 13 countries that were studied. These countries represent 70% of the total GDP of the world.
This is a reflection of the small and medium-sized enterprises receiving a performance boost through the internet. These companies with a strong web presence grew more than twice as quickly than those with a minimal or no web presence.
The internet has become a very significant factor in the world economy and the growth of the economy. More specifically in jobs and wealth creation.
Online marketing represents 15% of total marketing worldwide.
The search requests by individuals on hard-to-find items or information was a total of 1 trillion requests during 2009.
In the USA, web surfers made purchases worth $250 billion in 2009; in the UK, it was $63 billion or 2.9% of the GDP. The average online shopper in the USA has spent $1 773 during the year. In the UK, $2 535 was spent on average.
The study concludes that the influence of the internet on the economic growth in the world, on job creation and generating wealth, is becoming more important and stronger.
For individual companies the internet lowers costs and increases revenue, productivity and profits. The internet helps these companies to accelerate growth in the export markets and to have access to new markets.
The introduction of broadband stimulates the development of the internet in those countries where it is being introduced. The internet stimulates growth in GDP, in job creation, wealth, and increases productivity.
In France, the internet has created a total of 700 000 jobs during the past 15 years.
The research of McKinsey indicates the growth in people connected to the internet, the importance of doing business via the internet, and the big influence that these new technologies have on the GDP of the world economies.

THE INFLUENCE THESE DEVELOPMENTS HAVE ON MY HOME BASED BUSINESS

Accurate research information is not available about the expected growth in the online home based business industry. I want to make some estimates based on the information discussed above:

The annual growth in people connecting to the internet is growing with about 10%.
The ability of the internet to:
Create new jobs. Give people an extra income stream. Have their own home based business and being self-employed. These changes create many new business opportunity.
The new technologies related to the internet will create new business models that will stimulate opportunities.
More and more trading and marketing is being done via the internet due to the development of new systems and technologies.
The improved communication systems and technology makes it cheaper, less risky, and more attractive to start a home based business.
The influence of the development of the internet on the growth in the GDP of the countries in the McKinsey study has been higher during the last five years than during the previous fifteen years. The trend is upwards. Many of the conclusions in this study indicate that the influence on economic growth in the future will be higher than in the past. Some developed countries like the UK have a more people using the internet than others, for example the USA. That indicates growth in many of the developed countries.
Due to the development and introduction of broadband in the less developed countries of the world, new trading and business opportunities will become available.
There is a trend that more people who want to work from home, as indicated by the following quote: “Nevertheless, home based business owners are much more satisfied with their quality of life than other small business owners. However, the majority of home based business owners do not appear to have made a financial trade-off in order to secure this quality of life.”(c)

These new technological developments, the changes in the economic environment and changes in the social needs of people will result in a higher growth rate in internet related businesses, as well as in online home based businesses, than the 10% annual increase in people becoming connected to the internet during the next few years. If one takes into consideration that the average growth in the GDP of the world is expected to be much less than 10% per annum during this period, then there has to be good business opportunities here.

This expected growth in GDP due to internet related business activities creates many online business opportunities for the online home based business owner.

A fast changing economic, business, and technological environment needs quick and big action. The opportunity of today might have disappeared tomorrow. This is the environment in which to dream-it-plan-it-do-it big. Our team wants to support like-minded people who want to join us on this journey. Take action. Do not postpone in this business environment.

How to Make Your Advertising Work

Which type of advertising should you use for your business?

Many business owners will tell me, “Advertising doesn’t work!”

I hear this frustration a lot from clients and prospects. So why is it that the majority of advertising doesn’t work?

There are two types of advertising

Type 1: Is image advertising
Type 2: Is direct response advertising

What is the difference?

Image advertising is what you are most likely seeing when you see advertising. It’s the lone Beer can that say’s the brand name across the bottom of the page, or something else trying to be clever in the ad.

Image advertising is the beautiful woman holding the shower gel trying to make you think, “If you use it, she will come to a shower near you.”

Image advertising is all about getting the product out in front of you to make an impression. You may hear an advertising rep tell you that you will get 30,000 impressions per month when you advertise with their company.

Wow! 30,000 impressions, that’s awesome you think to yourself. That’s a great number if you just want potential clients to hear, or see the name of your company.

Image advertising is the main type of ads you see big companies run to get their name in front of you, and hopefully get “Top of Mind” awareness for their product when you’re shopping.

This is OK I guess, if your marketing budget allows you to put millions of dollars into ads without any real accountability to know if the ad is working for you.
Your Problem

If you own a small business, you may not have millions of dollars to put into advertising. Especially if you don’t know if it’s working for you.

How much money do you and your company make based on an impression?

I’ll let you decide on that number.

The number I would encourage you to become friends with, is how many impressions convert into paying clients?

So I bet you’re wondering about type two advertising, direct response, aren’t you?

This type of advertising has some call to action, or “Direct Response” when your target audience see’s the ad.

This could be as simple as “Call for our free report”, or “Click here to download the Top 10 Reasons your husband is a slug.”

Go and do a search on examples of advertising and direct response ads. Then look at the samples and guess which one is all about the image, and which is asking for you to take action.

If you see an order form on any ad, you know they are asking you to take some kind of action.

When you see only the company name in an ad, this a classic example of image ads.

What does the company want you to do when you see this ad?

If you hear someone say something to the effect of, “I want them to think of us the next time they are shopping”, it’s most likely an image ad.

Are you ready to take action on your ads?

Here’s what I want you to do (I’m giving you your action step).

Any time you decide to do advertising, ask yourself the following question.

“When people see your advertising, what action do you want them to take after seeing it?”

It should be an action that you can track to measure how much business did your advertising generate for you. This is how you make your marketing plan work.

Measure the results of your advertising, and it will start working for you. If it doesn’t, you will know to stop running the ad.

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.


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