Columbia, MD is a created city built by James Rouse and the Rouse Company. It was built on farm land in Howard County halfway between Baltimore, MD and Washington DC. Rouse is hailed as a visionary and a great person but not everything done always met the smell test. Continue reading
We have been working with a nearby company, Annapolis Clean Carpet to help them move up in the ranking in the different search engines. We have had some problems with it at first, but let me tell you the general idea.
No one truly knows what the algorithm is that the search engines use to figure out ranking. They don’t want you to know it because otherwise everyone would try to game it and that would defeat the purpose of their algorithm. People try and game it as it is of course, but the search engine algorithms get smarter all the time. Continue reading
TV Shows Business Model
The other day, House of Cards was filming at a church right around the corner from where we live in Baltimore. Quite a site, with trailers all over the parking lot, food trucks, generators, limos, hundreds of people from the actors to all the support staff.
There were tens of thousands of dollars being spent on this and it was just one scene from one show. How do they afford this? Continue reading
You can decrease your taxable income (and keep more money to yourself) without flouting IRS laws. According to Tax Foundation statistics, most Americans do not claim their tax deductions because they think that the procedure is too complicated or they are just unaware. Here is a list of 10 scenarios that are eligible for a tax write-off.
You do not have to own a charitable organization to qualify for tax deductions under the IRS’s Publication 78. If you are involved in any charitable work such as baking for a school’s fundraiser, you can write off those expenses.
- Sales or state income taxes
If you have a choice, opt to deduct state income tax. See if your state has the sales tax or income tax and use the IRS table to make your calculations. Also, add any big purchase you make such as vehicles and building materials to the sales tax rate.
- Casualty and theft
The federal government relieves you the pain of unexpected business losses through fire, floods, theft, or other unforeseen circumstances by allowing for deductions. Things that benefit your business such as body oil for a bodybuilder in a competition also fall into this category.
- Health Insurance premium
Itemize your medical expenses that exceed 7.5% of your adjusted gross income for deductions. If you are responsible for your health insurance coverage, IRS might give you 100% of your premium cost.
- Lifetime learning
Even after high school, you can claim tax deductions on education expenses. You can get up to $2,000 per year through the lifetime learning credit. However, at higher income levels, this benefit does not apply.
- Home mortgage interest
Every year, you can deduct 100 percent of the amount of interest paid on your mortgage.
- Real estate taxes and points
The fees charged by banks to get a home loan are converted into points and are tax deductible. If you are refinancing your mortgage, you deduct the points over the life of the loan.
- Self-employed Social Security
It is enough hassle paying for social security and Medicare taxes when you are self-employed. Get some relief by claiming 7.65 percent deductions from your income taxes.
- Looking for work
Hunting for your first job does not entitle you for any deductions. Once you get a placement and are moving, you can claim your deductions. If you lose your job, the costs of looking for new work in the same industry exceeding 2% of your adjusted gross income qualify for a write-off.
- Student loan paid by parents/guardians
Money spent by your mom or dad to your student loan is eligible for a tax write-off if you are not claimed as a dependent. The amount goes up to $2,500 of the interest paid.
With these deductions you can have a little extra change in your pocket.
What Not to Do
We have been working with NZ Used Appliances. When you go to their website, it is available to be claimed. Obviously this doesn’t help much. When people try to go to the website they don’t know if they are out of business or if there is a technical glitch.
What the story is, is that they paid someone to create and run the website for them. They got no leads from it and stopped paying them. Just having a website is not enough. It is like putting out an Open sign on a store that no one ever drives past. No one will know it is there.
What They Did Right
They created a Google My Business page so that they could show up on the map in searches. Many people make a mistake here by doing the bare minimum. Google gives brownie points for filling out the information as completely as possible. The listing will rank higher that way. NZ did a pretty good job filling out their listing.
What to Do Better
For the map listing, getting more citations is better. A citation is where another website lists your name, address, and phone number. This could be a directory, a social media site and other possibilities.
The next thing is content. Pictures are great for customers to see what you are selling or doing but search engines like Google and Bing rely on words to figure out what a website is about. The reason so many Wikipedia articles rank so high is that they have a lot of content and are very authoritative. The more helpful information and pages you provide the better. Don’t just copy content. Duplicate content is not looked upon favorably and can get you listing pushed down in the listings.
The other key item is the number of websites linking to yours. Why is that important? It is kind of like a popularity contest. If someone doesn’t like your website, they are unlikely to put a link to your website from theirs. So the more websites that link to your website, the more likely that people find your website worthwhile. Search engines want to give people a good search experience so more links usually means higher rankings.
However, not all links are created equal. A brand new website with no history linking to you will not have much power to help you. However, Wikipedia, NBC, NY Times or a similar website linking to yours will have a huge effect. It can have the same effect as links from tens or hundreds of small websites without much power.
Social Media and Advertising
The above was about getting a website seen in organic rankings. However, there are also strategies for getting seen on the various social media networks like Facebook, LinkedIn and Twitter. That is for another article.
It is also possible to advertise on Google, Bing, Facebook and others. There are a number of strategies to accomplish this and they vary depending on where you are advertising, what you are advertising and to whom. It is possible to sink a lot of money into online advertising very quickly but it is also possible to make a lot of money if you know what you are doing. Once again, that is a whole other article or more likely articles.
Emotional Intelligence, The book reveals how to have an impact on your performance
Are you in the sales after completing your schooling? Are you learning all the selling techniques from the books, attending seminars and taking guidelines of successful sales teams? Yet unable to reach your goals and turn productive. The problem is in the atmosphere and state of mind you create than the sales techniques knowledge. It is time you work on emotional intelligence.
Emotional Intelligence is a study that examines why and how our conscious, the process of logical decision making differs from our unconscious emotional triggers leading to a decision and mindset that can hinder the desired result accomplishment. Emotional intelligence impacts your performance, have you heard about it, if not read this book mentioned below here.
‘Emotional Intelligence for Sales Success’ is a resource for the sales team leaders and sales professionals. This book offers points on things to look for and apply while hiring and training sales staff who can lead to more productivity, higher retention levels and job satisfaction.
Colleen Stanley is an author of ‘Growing Great Sales Teams’ , a monthly columnist for Business Journals and co-author of ‘Motivational Selling’. This book is a guide to the sales field and its application. Colleen Stanley, the author, President and founder of SalesLeadership, Inc, offers techniques identifying emotional triggers that have set off and can be recognized in your prospects. This book has concrete examples of how these triggers may be dealt and you are more productive in developing trust, business relationships and eventually increase the sales success. Colleen has illustrated with examples of how people miss excellent business opportunities due to lack of awareness about the principals of emotional intelligence.
Sales deals with handling stressful selling situations and there is a need for the emotions to run the sales meet using influence skills and effective selling techniques. Actually, the non-qualified and non-productive selling behaviors include product dumping, discounting, etc and these also product sales results.
Nevertheless, Colleen Stanley says that it is your ability to assess, identify and control emotions that reveals a direct impact on the sales. Elevating the emotional intelligence quotient with respect to sales helps in selling and making in less time full margin bigger deals.
Precisely, a straight forward explanation is to understand your hot buttons, when and why you react and what hinders you professionally and personally. Wisely handling your emotions helps in working better and having the desired approach to achieve the sales numbers.
Most small business people, especially when you are starting out are cash strapped and basically have to do everything or at least know how to do everything.
Time Limits to Growth
But, there are only 24 hours in a day and you can only do so much. How do you leverage yourself. Because if you don’t figure out how to multiply your efforts, your business is never going to grow very large. It is going to be limited by your abilities.
If it is all based on your work and it is a service business, then the amount you can charge per hour limits how much you can make. And if you can’t work, you can’t make anything.
Similarly, if you are selling a product, there is only so much you can sell, make and ship before you are maxed out. The only way to make more money is to sell more expensive products or hire someone to help.
Where is the Value Added?
So you need to figure out where you can make the most difference in the company, where you add the most value and then see who you can hire (part time, full time, contract basis) that can do some of the work so you can focus on the more important things and on the business.
As soon as possible, you want to hire someone to do the $10/hour jobs so you can focus on tasks that are $100 or$200 or $500/hour in return.
What are You Good At? What Do You Enjoy Doing?
Some things you aren’t good at, others you don’t like because you haven’t learned how or aren’t good at. Some things simply need to be done. Others, you might need to spend some time learning. Once you have practiced something you might find you are good at it.
One of my daughters growing up would try something once and say I am no good at it, I give up, I am not doing this. (Other things she would tackle till she persevered.) Part of the problem was that she wanted to do things perfectly the first time and didn’t like to fail. When this was pointed out, she would get on with things and do fine.
If you are better at technical aspects, then you might want to find someone for sales. If you are great at sales, you might want to find someone who is very organized and can run day to day operations.
Even though you are paying people to do different aspects of the business you will grow larger and faster than if you try to do everything yourself to save money.
I have heard this elsewhere but it was brought home again in the book “The Ultimate Sales Machine” by Chet Holmes. The model that he touts in large parts of the book is also similar to how many people sell on the internet.
Essentially the Strategy that Many Use on the Internet
Google uses this model in many ways. For them it isn’t so much about providing education as information, which is not that different. By offering something of value for free, they attract a large audience that then becomes attractive to sellers and so Google makes its money on advertising. They are able to provide advertisers with more targeted advertising than almost any method of advertising in the past.
Many other people use education to sell on the internet. They offer a free ebook, free information on their website, a free webinar with information that is useful to people to attract them. Then they offer a subscription or more in depth offering for a fee and that is how they make their money.
Expand Your Audience
What Chet Holmes points out in the book is that usually only about 3% of people are looking for your product or service at any time. There are a lot more that might be helped by it and save money using it but they don’t realize it and therefore aren’t looking for it.
Educate and Direct
If you advertise or promote your product or service, you will attract the 3% but not the other group which is many times that size. It is just not on their radar screen. However, if you offer education that helps them, they will pay attention. Things like, 7 Things You Can Do to Double Your Sales, or 10 Things You Should Know About Indoor Pollutants in Your Home, etc. Then you can pick compelling information that also makes a case for your services or products.
By doing this you are not only appealing to the 3% but to the 30 or 40% of the population who probably have need of your product but don’t know it.
You can do this through advertising, meetings, trade shows and other means.
Tuck Business School is usually ranked in the top 5 in the country. Its professors are well known in the area of business strategy and have come up with some important ideas and concepts.
One of them is Vijay Govindarajan. He grew up in India in a lower middle class neighborhood in a one bedroom house with his parents and five brothers and sisters. Electricity couldn’t be counted on. He figured that India had few resources and lots of problems. If he wanted to get ahead he was going to have to be innovative. He feels that the only way to move up, either as a person or a corporation is to be creative and innovate.
Vijay went to Harvard Business School on a Ford Foundation scholarship. The scholarship required that he spend two full years in India after graduation. But then he got a job offer from Harvard Business School and they required him to start work one week before the full two years were up. Neither Harvard or the Ford Foundation would budge and Vijay had to pay the Ford Foundation back for his business school education.
He was struggling to get by when a more senior professor suggested that he try doing some consulting on the side. He did and loved it and found that it provided a great synergy to his teaching and research. He was able to get in and see what companies were doing and not just do things from an ivory tower more theoretical approach.
One key idea this has led to is Reverse Innovation. Reverse innovation is the process of inventing or designing products for use in underdeveloped or emerging markets. Then you bring those products back to the wealthier countries.
Example / Inspiration
He came up with this idea of course while consulting. In this case, he was consulting with GE. He saw that they had developed an ultrasound for the Chinese market that only cost $5,000 and was portable. In the US an ultrasound machine with similar function costs $300,000. GE brought this machine to the wealthier countries and sold a ton of them. But they didn’t understand what they had done because it was such a small event in such a large company. Vijay picked up on this and used it as a focus for his research. He also told GE’s CEO Jeffrey Imelt about his discovery and Imelt jumped on the idea. He made it a major focus for the following year.
My mentors, Dan & Brad spoke last night and stressed that the key to a successful business is leads and sales. You might add a third, which is conversion. Just because you have a lead doesn’t guarantee a sale, so conversion is important as well. Although if you have enough leads you can overcome poor conversion.
Play to Your Strengths
They pointed out that some people are able to excel at both, but many people have a knack for one or the other. So team up and let each person do what they are strongest at. One generating leads and the other closing business. Sometimes the whole is more than the sum of the parts. Each of you should make more money teaming up.
We were also reminded that business owners don’t care how many ads you run, whether they are in position 1 on a Google search or anything else like that. They care that they are getting leads, making sales and growing their business. If you can deliver leads, they aren’t going to care what position they are in.
Listen and Question vs. Pitch
Find out from them how many leads they are getting currently. How much is an average sale and what is the average margin or profit per sale. Then you can figure out where they are now. Then ask given their current resources, how much extra capacity do they have to do more work. If they are maxed out, that is a different discussion.
Most companies have more capacity to do work that they an utilize. Then take that number and multiply out and figure out if they could get the leads and the sales, how much extra in sales and profit that would be. Then ask them what they are doing to get there. If they are just going to do more of the same, they might not make it to that goal. They need a new channel and strategy to bring in more sales. That would be you!
Listen, Diagnose, Prescribe
By finding where there pain is and where their dreams and vision are you are gaining information and leverage so you can better sell them but more importantly so you can better help them. If it doesn’t work for both parties you probably won’t make a sale. So don’t just pitch them and sound like everyone else touting why they are great. Listen, diagnose, and then prescribe.
I know I have already done a post on passive income. I was sitting down one day and wrote out some more by hand. Sorry if some of this is a repeat.
Passive Income vs. Active Income
What is passive income and why do you want it? Basically passive income is making money while you sleep or vacation. How would you like to go on vacation and come back with as much or more money as when you left? (And not because you hit the lottery while you were on vacation.)
This is basically your salary, your paycheck. The problem is that you are trading time for dollars. You only get paid for the hours that you work. If the work is something that a lot of people can do, it doesn’t pay well. For example, washing dishes or digging ditches. You can be really good at it and you still won’t make much money.
The more unique your skills, the more you can make per hour. Lawyers make $200-500 per hour and sometimes more. A doctor is similarly highly paid because of their specialized knowledge. But even among doctors, some with unique skills are paid much more than other doctors.
BUT. They still only get paid while they are working. If they take time off or go on vacation, they aren’t making any money. So their income is capped by the hours they can work unless they have another source of income.
Passive income is not dependent on how much time you put in, but on how smart you are in how you use your time, resources and money. Passive income can take various forms. Following are a number of examples of passive income.
One way many people do it is investing in stocks or bonds. The assumption is that you will receive income from dividends and also that the value of the stock will go up over time. The problem is that sometimes the value drops so you not only aren’t getting passive income, you are losing money.
Another way is to loan money and earn interest. A wise person once told me that smart people (and often also wealthy people) earn interest and that foolish people (and usually poor) pay interest.
Hard money lenders
One example of this are hard money lenders. These can be anybody. There is a doctor locally who is a well known hard money lender. They lend money to people rehabbing houses. Frequently they take a fee of 5% of what is loaned and the interest rate is often 12-15%. Why would someone borrow at such high rates and with such high fees? Hard money lenders are more flexible than banks. (But they aren’t stupid. If you don’t perform, they will end up owning your house, although for most, this isn’t their goal.) You don’t need all the paperwork associated with a bank loan. It can be done much faster. And what if you have a ding on your credit and can’t get a bank loan? The hard money lender only cares about if the deal makes sense and not your credit rating.
You would never use a hard money loan to buy a house and rent it out. You would lose your shirt. The loan makes sense when you buy a house, take 1-3 months to fix it up, then sell it. So you are only paying the high interest rates for a short while and if you did the rehab right, you have significantly increased the value of the house and you will make a nice profit despite the high interest rates.
But, for the hard money lender, rather than making 2% interest in a bank account, they are getting 5% of what they loan and then 12-15% interest. And, if the rehabber is fast, they can do this with their money 3-4 times a year. It only takes them a few years to double their money.
Book and Music Royalties
If you write a book or write a song or sing a song that is popular, you can earn a lot of money on the royalties. Of course, many people write books and songs that aren’t that popular and never make much money. But the idea is that you put in the time on a one time basis and then you can make money from it for years to come.
TV and Movie Royalties
Similar to book and music royalties. If an actor is in a TV show or a movie, they will get royalties whenever it is shown or a DVD is purchased. If it is popular in reruns, they can make money for years for the short period of time they did the acting. However, this isn’t true for all actors. Performing on stage is like having a salary. You only get paid for the performances you act in and the salary is limited by the size of the audience in the theater. But for TV and movies there are two effects that make for a much greater income. The first is that the audience can be in the millions and therefore the pay is greater. The second has already been mentioned in that you not only make money at the time, but each time it is show in the future which can’t happen with a play or musical.
Inventors, Patents and Royalties
Another way is to be an inventor. You can then patent the product or process and license it to a company who pays you a royalty for the use of the invention. Another way is to create a company around the invention that grows and if run well, allow you to step away while other people run the day to day business.
Starting a business
Some people start a business and they spend even more time working on it than they did when they had a job working for another company. The key is to create systems so that other people can be trained to do the work and you don’t have to be putting in crazy hours all the time. There is a great book on this topic called the eMyth Revisted by Michael Gerber.
Another way is to write a piece of software or an app or plugin which people then buy. Or you can set up a marketing / sales funnel on the internet which brings in leads or sales automatically for you.
These are just a few ideas for passive income.