Surviving and Thriving With a Home Based Business

Thanks to the power of the internet, the dream of working from home either on a part-time or full-time basis is more accessible than ever. However, while home-based options are certainly lucrative, they are not necessarily guarantees for success. Home-based businesses do carry some risk of failure, which is why some people may be hesitant to start such a task. However, with the right knowledge, anyone can make a home-based business thrive.Understand the ProductThe majority of modern home-based businesses relate to sales or marketing of some kind. Whether it is a multilevel marketing opportunity or another type of network marketing situation, these home-based businesses rely on buying into a system and then turning that system around to others. Each opportunity will be somewhat different, with its own perks and nuances. Before deciding to join up with any such home-based opportunity, it is essential to understand what product is being offered. This may seem obvious, but since so many of these opportunities involve virtual products, entrepreneurs must put extra effort into completely comprehending what their business entails.Self-EmpowermentPeople who earn money from home have to be prepared to motivate and educate themselves. This is why understanding the product is so critical to a successful home-based business. First of all, it is important to know that the opportunity is actually legitimate. Unfortunately, along with the numerous quality home-based business opportunities, there are also a smattering of scams. In order to avoid these scams, some research is in order. Reading up on the company’s policies and checking out testimonials regarding the company from third party reviewers should dispel any concerns regarding legitimacy.In addition to making sure the home-based business is a viable option, the better one understands how the business model works, the better prepared one can be to meet the challenges. It is important to know how much work is required, the hours most people put into it, and what kind of profit can be realistically expected. In this way, understanding the product being offered and the system by which it is offered is an important step of self-empowerment while pursuing a home-based business.Reaching ClientsUnderstanding the product is also critical to being an effective salesperson. After all, it is difficult to sell a product that one does not totally understand and believe in. The better grasp one has on the product, the easier it is to effectively set up a marketing program. This allows individuals to focus on the best characteristics and know how to appeal efficiently to prospective buyers. Additionally, a high level understanding is important during follow up conversations with clients. While many people can make an effective opening pitch, the real sales work comes through ongoing discussions with clients. Sellers must know their product inside and out in order to answer all questions that clients may have. Strong, consistent responses to questions can be an essential difference between making a sale and losing a customer.Growing SuccessThoroughly understanding the process and product of a home-based business will take some time and effort. However, the investment will reap real dividends for serious entrepreneurs. The more one knows, the more one can sell, and in this way, anyone can take a home-based business opportunity and grow it into a successful and satisfying business venture.

Planning Helps a Home Based Business to Be Efficient and Successful

The very first step towards a successful home based business is some self introspection. What are your skills and talents? You may possess good communication skills in which promotion and sales of consumer products would be god for you. Writing or mathematical skills all serve as a good base for being a self employed professional. Chalk out all your skills and make a list of the possibilities when starting a home based business.Various business possibilities to start from home
Free lance chartered accountancy
Home based cosmetic and consumer sales and consultancy
Tax consultancy
Web Content specialist
Business organization and training
Cookery classes and catering
Interior designing
Computer hardware or software specialist
Factors and pitfalls that influence home businessOnce you have your list narrowed down to the best possibilities you should work out the infrastructure and financial aspects necessary that will support the possibility of the business. Working out the business logistics that comply with your home is a matter of great importance. The factors that are going to determine your business are,Location: you cannot start a bakery in a crowded domestic neighborhood waking people in early hours of the morning. Avoid running a business in a crowded domestic neighborhoodSpace: you will need a certain amount of space dedicated to the running and functioning of your office. Space would include a storage area depending on the product. Cluttering your home space with supplies and goods will lead to chaos. Always take your available home space into account.Finance: one must consider the amount of finance required for various businesses. Starting something that requires exorbitant amount of money like franchise fees may not be feasible. Avoid getting into debts which will incur a loss rather than a profit. Make out a projected statement of accounts to see how much of a loan can be incorporated within the business income.Documentation. Every Home based business requires minimum government documentation like a trade license. For documentation required to start a business you can visit your local authorities for further information. Do not start a business that requires complex documentation and verification.Once the main aspects to be considered are done you should start on working out the number of employees you may require for assistance. Starting a home based business may require just a couple of senior level employees. An office and secretarial assistant and in the case of consumer products, one or two delivery men. Where accountancy and tax consultation services are concerned these may require a maximum of two assistants and a clerk to help with all the documentation and clerical work.Once you have got around to starting a home based business, you need to motivate yourself in order to keep it running efficiently and grow as well. Structure a good working routine which will not allow you to be distracted. Working from home may lead to certain distractions which could hamper the business. Therefore learn to incorporate family time within or after business hours to ensure a smooth operation of the same. Hire a babysitter if necessary if you have a young child at home.Promotion and advertising are important factors that determine the success of your business. Self promotion through word of mouth is a good way to help your business gain popularity. Advertising costs are expensive, the best possible way is to be as efficient as possible so that recommendations keep coming your way. Follow these important guidelines to assure a successful home based business

All About Small Business Loans – How to Get Them

If the business employs less than a hundred, is owned and operated independently, and not the market leader in the industry where it belongs, then it is considered a small business. These are some of the criteria of the U.S. Small Business Administration (SBA) defining a small business.One of the most common problems of a small business owner is the lack of funds to maintain, run and expand the business. If you have this problem, then these frequently asked questions will guide you in making your business survive through the support of a business loan.What is a Small Business Loan?A small business loan is the type of loan that lends money or funds to a small business owner so he or she can operate the business. It is also made available for individuals who wish to start a business.Small business owners may use the amount borrowed for the establishment, construction or renovation of the business, acquisition of the necessary equipment, and for operational expenses such as payroll.While a small business loan refers to a loan for the business itself, the personal credit history of the business owner will strongly determine if the bank or lender would give its approval to the application. Thus, a small business loan is also termed as a personal loan granted to small business owners.How to apply for Small Business Loans?When you apply for a loan, your loan provider will look into your personal credit history. You, the business owner, should also be able to project a sense of deep commitment to your small business. The lender will gauge your willingness to put a portion of your personal funds to help the business prosper. Be prepared also to present a loan security or collateral such as a house or car. What’s more, your educational background and expertise are also important factors for your business to be granted the loan.The small business owner is also required to submit a business plan. A business plan is a written proposal which details the nature of your business, marketing strategy and contains a financial report. This document should also include how the business will generate income and support its operational expenses in the coming years. Moreover, the business plan should be able to convince your loan provider that you can pay the loan within the stated date of payment through the profit realize from the business and its expected continuous growth.Remember that lenders need to make sure that the business can survive to pay up the loan and that its owner is credible enough to guarantee that the business is well planned to prosper.Where to apply for Small Business Loans?You can apply for a loan traditionally, which means going to local banks and government funded organizations. Even your local cooperatives have facilities for small business loans.You may also apply for a loan online. Online application for a business loan is easier and convenient for a small business owner. You no longer have to waste time scouting for the best loan arrangement in the market. All you need to do is visit various websites and compare the rate and application requirements. However, make sure that your target small business loan provider is credible to avoid problems later on. A national bank with online capability is the best choice.

Legitimate Home Based Business – How to Find the Right Business to Profit

Are you looking for a legitimate home based business to make money online? If you are taking the time to check out if Internet Business models are valid, I want to applaud you. Many times when people are looking to make money from home, they get so caught up in the hype to make money that they miss the very important factor of choosing the right model to profit.

If you are serious about making money online, the very first business choice will be which Internet Business you choose to partner with. Finding a legitimate home based business opportunity will give you not only the avenue to creating a solid income, but will also provide you with the option to create a lasting and long term income. This is your first critical step to insuring you are profitable with your online opportunity.

With so many websites, and work from home advertisements it can be difficult to distinguish which Internet opportunities are valid. If you are serious about finding a legitimate home based business, then there are some important question that you must ask. . It is important to make sure the Business structure is designed in accordance to legit guidelines, and regulations.

How To Find A Legitimate Home Based Business

1.) Products Or Services – The business model should have multiple products and services. It is suggested that the products should never offer outrageous product claims. There are products that claim to cure diseases for an example. Be wary of these product or service claims they usually are not in business long, and you as a owner can get in trouble for partnering with a company that makes these falsified claims. Every product has a target audience, it is suggested to go with multiple products to give you a larger target audience that would be interested in the benefits offered. The more product ranges the more difficult it would be to falsify the product claims.

2.) Retail Value – Never purchase just a money making opportunity A legitimate home based business is not just about swapping money. There has to be a real product and service available. In addition you have to be able to resell your products to your customer base. The company you are looking into should provide you with a retail center to sell all of your products and services as well if you want to resell the opportunity. The Internet is a mass resource, and has opened the door to be able to provide people an avenue to bring in an extraordinary income. But don’t fall for the company that sells just the dream, you need real products to make a solid income..

3.) Monthly Fees – A monthly fee is expected with any Internet opportunity. They can range from 40.00 – 100.00 per month. What you should be aware of is what happens if you miss a monthly payment? Do you lose your products and services? Many times an Internet opportunity will not allow you to use the products you purchased if you stop the monthly fee. When you joined your business you paid for complete rights to the products or services, regardless if you miss a monthly fee you should never lose your product range. A legitimate home based business will never take away your products or your services from you. If you purchased rights to those products they should be yours to keep and utilize.

4.) Get rich quick Schemes – Stay away from people who suggest that you will get rich within an unrealistic time frame. Be realistic about your game plan. The first month you should want to recover any business expenses, and start profiting within your second month. Stay away from those that claim you will make an outrageous amount in your first month.

5.) Telephone Number – If the company telephone number is 900 number stay away from them. Never will a legitimate home based business opportunity have a 900 number on their website. Its also suggested their is a live voice behind the number. Starting an Internet Business, without talking to someone is highly discouraged.

6.) Free Business Information – You should never have to pay for information about the business. If you are looking at partnering with an Internet Business do not pay for more information. You should be offered the company information for free.

7.) Mentor and Trainer – Their are times when you will find a legitimate home based business, but the mentor or your trainer is the one who is not legitimate. Make sure that you spend your time not only researching the opportunity but also researching the mentor or trainer that you will be partnering with.

8.) Investing In Your Internet Business – Starting an Internet Business is different then a work from home job. An Internet opportunity is different then opening a coffee shop for an example, where it eliminates a high over head, however this is a real business structure. There is always a capital expense that should be expected. Compared to large capital expenses with a structural opportunity, Internet offers people a lower start up cost. While you should never pay for a job to work from home, starting a business is different then a job. Make sure you are clear as to what you may be putting capital towards, know if you it is claimed to be a job or a business that you can build over the Internet.

Many dream of making money online from home. Finding the right home based business will give you a real and valid way to make a solid income from home. Make sure that during your business research you ask the seven questions above. In order to qualify a legitimate home based business, they should have all eight components that have been outlined. Do not settle for an opportunity that is missing even one of the seven steps above. You owe it to yourself and your business to make sure you have the most profitable business structure to profit.

What Do You Know About All In One Directional Advertising?

Advertising is the key element of any business. If the advertisement thrives, it can mean immense traffic that generates thousands of dollars in income. Advertising requires original thinking because conventional advertising mediums are becoming very costly. Advertising is the best method to make sure that customers learn about your products or services. But the real question is; are you getting the proper returns on investment on your advertising dollar and do you feel that your promotion dollars and advertising overheads are giving you the results that you want? Probably you have been wondering where to advertise your business. Stop wondering, just look for a website that has the potential to draw thousands or millions in traffic and your business will surely benefit.

Most advertising sites offer only one of three main categories of directories, that is, classifieds, normal directory or jobs. If you find sites that offer all three probably the traffic generated is greater.

Classifieds usually contains more than 10 categories including houses for sale, rent, apartments for sale, rent, shops for sale rent, and offices for sale, rent, cars for sale and business opportunities.

Directory usually contains more than 2,000 categories of listings. Among the more popular categories are advertising, airlines, banks, beauty salons, bus lines, computers, charities, travel agencies, building contractors, renovators, consultants and interior designers, florists, hospitals, hotels, transportation, car rental, car accessories, office furniture, restaurants and photographs retail centers.

Jobs usually contains more than 60 job categories under the main headings of Accounting, Finance, Human Resource and Admin, Sales, Marketing, Arts, Media, Communication, Services, Hotels, Restaurants, Education and Training, Computer, IT, Engineering, Sciences and Healthcare.

Web Surfers from all over the world can search for and view products and services advertised and do business with the advertisers.

The importance of advertising in a directory is outlined as follows:

1. Supply necessary information

The customer may be looking for more information than just name, address and telephone number. They may need product or service details.

2. Complete directory representation

Sometimes a company may be known by two or more names. They may deal in two or more types of products or services. Therefore, an advertiser may want to advertise in different names and classifications.

3. Supply attention and value

Directory advertisements offer aggressive business a chance to secure a bigger ad space, thus showing itself to be more prominent than its competitors.

4. Trade mark and trade name identification

Customers may be just looking for a company trade name which is better known instead of its company name.

5. Focus attention on a specific product or service

If a product or service can be obtained from several sources an advertiser will benefit if he can point out the advantages of buying from him instead of his competitors. He can do so in a directory.

6. Maintain prestige

Directory advertising is special advertising which differentiates a prestigious business from an ordinary one.

Advertisers must understand the above functions of an online directory. They must be able to differentiate directory advertising from general advertising. When directory advertising is confused with general advertising sales executive from a directory company will face a very serious problem because he will meet with strong resistance and put into a class of media with fierce competition where magazines, television, newspaper, radio, exhibition and dozens of other types of salesmen battle for a place in the businessman advertising budget.

In most businesses all advertising is designed to build a desire for the company products or services. Directory advertising is used after the prospective buyer has already decided to buy. He is just looking for the seller. Therefore, general advertising is concerned with a product looking for a customer. Directory advertising is concerned with a customer looking for a product.

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.

Five Tips for Selling at Live Auctions

Ah, the old-fashioned country auction! The idea of a country auction conjures up certain images for people. The image of a fast-talking auctioneer offering up an antique table or chair is a popular example.

People who are buying household goods or collectibles are looking to get their items at the lowest price possible. However, the people who are selling their items at auction are hoping for the highest price!

Unless a person is in the business of buying and selling antiques or other items, not a lot of thought goes into how goods are prepared for sale via the auction process. However, if you are one of the growing number of people using auction venues to sell your collectibles or other inventory, there are a few things to learn first about how to sell at auction before you bring a truckload of stuff over to the next event.

Tip 1: Make sure the things you want to sell are a good “fit” for the auction house you’ll be using.

Never bring a load to an auction house without actually having been to one of the previous auctions. It’s important to get a feel for the type of goods that the house sells. For example, at one very rural country auction it was common for the owners to sell live chickens, pots and pans, car parts, and farm equipment.

After close investigation, this would not be the right venue for selling your daughter’s “Hello Kitty” collection. On the other hand, the spare John Deere parts that you bought at last week’s yard sale might be just the right thing for the buying crowd at this auction.

Tip 2: Be sure you clearly understand the terms and policies of the auction house.

Visit with the auctioneer ahead of time. Call to find out what the best days and times are to visit. One of the worst possible times to drop in for an informational visit with an auctioneer is the day of the auction. Call ahead and ask. While you’re at it, find out what are the best days and times to drop your stuff off.

Once you have a little time with the auctioneer, you’ll be able to find out what type of commission he or she takes from consigners (which is you), and what type of paperwork might be needed. Some auction houses send out Form 1099 tax forms at the end of the year. An auctioneer may need to see your identification and have you fill out a W-9. Be prepared.

Find out what happens to your items if they don’t sell. For example, some auctioneers may have a minimum starting bid. If, for some reason, one of your items does not sell, it may be grouped with another one of your pieces. Know the auctioneer’s strategy beforehand so that you aren’t surprised on pay day.

Tip 3: Make sure the auctioneer knows what you’re selling.

It might be perfectly obvious to you that the signed print you are consigning is a rare and valuable piece of art. However, the auctioneer may not know this particular artist. Make a note of anything particularly special about your items, and leave the note with the piece. Be sure to tell the auctioneer about it as well. He or she might determine that this is something to highlight on the company website or in the newspaper listing.

Tip 4: Present your items neatly.

No one likes to have to dig through a box full of grimy and greasy car parts to see what treasures might be in there. Separate the parts and lay them out on a flat, or use more than one box to de-clutter the lot.

There is no need to buy fancy display boxes. It’s easy enough to go to the local convenience store or supermarket and ask if you can have the emptied boxes or flats that they are discarding.

While it’s good to present clean items, take care not to ruin the value of anything by over cleaning. For example, if you find some old cast iron cookware, clean the obvious dirt and grime, but don’t scrub it to its original finish. For many people, this ruins the value of the item. So, clean and tidy and organized is the key here.

Tip 5: Don’t complain to the auctioneer if your stuff doesn’t sell for as much as you’d like.

The phrase to remember here is, “You win some; you lose some.” That’s just the way it is. There are some days where an auction house is loaded with people who all seem to want what you’re selling. There will be other days where the crowd is sparse, and the bidding is simply not competitive.

Remember that it’s in the auctioneer’s best interest to sell your things for the highest possible hammer price. But sometimes, it’s just not going to be a stellar sale. The auctioneer is only human, and is also disappointed if a sale doesn’t go as well as planned.

If you notice that every time you bring a bunch of goods to sell that you’re not realizing as much as you think you honestly should, try another auction venue and compare apples to apples. That is, bring the same types of items to the new auctioneer and compare the results.

Unless the auctioneer is particularly disagreeable or inconsiderate to you or buyers, there is no reason to confront him or her about a sale. If you find you just don’t care for an auctioneer’s style or methods, find another one. Believe me, there are plenty of them out there!

The primary thing to remember as you learn how to sell at auction is that the business is unpredictable at best. You will have good days, some not-so-good days, some great days. The more you sell, the more experience you will gain, and the more enjoyable the business will be.

Real Estate Auctions – The New Land Rush

On a sunny afternoon in Florida, an energetic crowd gathers on the lawn of a high end luxury estate. A loud and eager banter between an auctioneer, a group of bidders and bidder assistants fills the air. For several minutes the auctioneer asks for the next highest bid and the bidders respond. Suddenly the bidders grow silent. The high bidder holds his breath in anticipation of winning the auction. The auctioneer calls for one more bid. In a loud clear voice which rolls over the audience he says, “Fair warning, last chance” the auctioneer pauses, “SOLD!” And in less than 10 minutes another multimillion dollar estate has changed owners.

Successful real estate auctions like the one above are happening all over North America and the Caribbean. Recently real estate auctions have been on the rise, the increase in popularity is partly driven by growing inventories and fading buyer confidence. Properties that were selling in weeks using traditional methods are now languishing on the market unable to attract buyers even as seller’s lower prices. Many say the real estate boom is over but savvy buyers and sellers are profiting from real estate auctions.

Real Estate Auctions Work in Up or Down Markets.

Regardless of trends or market cycles, real estate auctions provide an open and transparent process for buyers and sellers. Properly conducted real estate auctions attract ready and willing buyers and motivate them to act now.

The auction method removes the “wait and see” attitude which serves to further depress real estate values. Buyers are always concerned about overpaying. Buyers gain confidence with their purchases at real estate auctions because they can see what others are willing to pay.

When market demand is high and inventories low, real estate auctions can deliver selling prices well above what a willing seller would have accepted in a negotiated private treaty sale. In good selling climates many property owners using traditional real estate methods; negotiating with one buyer at a time, leave thousands of dollars of equity on the table. During up markets real estate auctions are the best way to establish top market price.

Evaluating Your Real Estate for Auction

Not every property or seller for that matter makes a good candidate for auction. First of all sellers must be ready to sell now and for the current market value. Also a real estate auction will not fix problems caused by a downturn in market value of your property, if you owe more than a willing buyer will pay, be prepared to come to closing with your check book.

Properties that do well in real estate auctions have a high uniqueness factor. Ask your self, “What makes my property different from most others?” Maybe you own a resort property or high end luxury home, commercial properties and land do very well at auction. Real estate auctions thrive on uniqueness. If your property is like everyone else’s, the best thing you can do is offer the most competitive price.

Most importantly sellers must be reasonable about setting a minimum bid. A seller must look at the lowest, most current comps and price below that to generate the interest and urgency necessary for a successful real estate auction. Once the auction begins and qualified bidders start competing against one another you can watch the selling price increase.

Locate a Qualified Real Estate Auctioneer

Start by checking with the National Auctioneers Association, the best real estate auctioneers belong to this organization. These real estate auctioneers are well trained and adhere to a standard of practice and a code of ethics. Many attend the annual International Auctioneers Conference where the latest techniques and innovations in the real estate auction industry are presented.

Find out if the company you are interviewing is a full time real estate auction firm. Many real estate agents are getting auction licenses yet have no experience with the auction method of marketing. Conducting a successful real estate auction is nothing like (private treaty) traditional real estate sales. Go with a real estate auction pro.

You’re probably better of with an auction house that specializes in real estate auctions. There are many qualified auctioneers who have generations of experience selling personal property; furniture, dishes, lawn equipment and the occasional rare painting. Selling real estate at auction is a complex matter that should only be attempted by full time experienced real estate auction professionals.

Commissions and fees may vary, sellers must pay all marketing expenses up front and buyers typically pay 10% of the sales price to the auctioneer of which a share goes to participating real estate agents.

Types of Real Estate Auctions

Auctions are effective because they create a seller’s market. Professionally conducted real estate auctions create urgency, a reason to buy today and competition for the property. Terms and conditions of sale are established ahead of the auction. Real estate auctions will follow one of these three approaches:

Absolute Auction

The property is sold to the highest bidder regardless of price- using this process often returns the highest sale price.

Minimum Bid Auction

Seller agrees to sell at or above a published minimum bid price – this method is useful for internet auctions.

Seller Confirmation or Reserve Auction

With a reserve auction, the seller “reserves” the right to accept or decline any bids usually within 48 hours of the auction. Reserve auctions are used when there is a lien on the property from a lender or a court ordered sale with a minimum selling price.