Top home based businesses can help a person kiss the 9-to-5 commuter gridlock routine goodbye, and say hello to a better return on investment. More time with family, lower stress, better overall health and a better quality of life. Top businesses provide training, ongoing support, and multiple streams of income. Many have over-hyped claims of earning potential.For the more industrious, working for yourself can take two primary roads. You can work to assist with someone else’s requirements as an independent contractor or consultant. Another road is to launch your own small business. While the employment market is not as flooded with opportunities, home based businesses are flourishing. The avenues to find these opportunities have expanded along with the home based workforce. Top home based businesses are in direct competition and as successful as the more traditional businesses. It’s common knowledge that both “eBay” and Microsoft started out at home. Since the internet boom, dot.com and web brethren have seeded businesses that blossomed into business giants.Types of home based businesses that are performed for a third party have benefits and disadvantages. Just as an employee would compete for a traditional job, working from home for others involves winning the job. This entails market research for job opportunities, applying, winning and successfully performing. Applying for contracting jobs includes proposing at the right mix of labour types, responsibilities, costs and time line.Performing the role as a consultant or contractor has benefits and drawbacks. Contractors are often responsible for deducting and paying IRS taxes due. Contractors and consultants are typically responsible for tasks and deductions normally handled by a Human Resource department. Health care and life insurance are critical benefits that garner much interest from the independent workforce. For independent workers, self employment organizations, such as the National Association for the Self Employed, can assist with payroll, business, legal, marketing, and accounting requirements.YourNetBiz – provides products, training and support and only sold through sponsors who partner with you in the business to help you succeed. It allows greater potential for success if you choose the right mentor or sponsor.Industry market research data can be instrumental in establishing which industries are stable, declining or growing. Occupational research provides critical rate and salary data, identifies standard training, education, and staff composition. Data can be incorporated into competitive proposal strategies to become a contractor, consultant or to win business, contracts or grants for your own company.Not surprisingly, top home based businesses include administrative support. Independent work portals typically have virtual assistant, administrative, typing, transcription, reception, data entry, and similar employment assignments. Each of the following sites offer administrative employment and employees:Guru.com, freelancer.com, ifreelance.com, odesk.comFor the artistically inclined, deviantart.com, etsy.com and eBay offer marketplaces to sell and buy products. Crafts such as clothing for people and pets, candles, bath and body products are bought and sold from home. These products are among the best home based businesses. Specialty or gourmet edibles like cake, candies, and cookies are a self renewing customer need. Specialty coffees, teas or drinks are sold online from homes around the world.Technical work such as programmers, coders, developers and support positions such as web content developers and designers, are among top home based businesses. Practically any employment website has countless technical opportunities. A web master can be self created. Much like an artist, technical workers can create a portfolio of work to demonstrate knowledge, skill, and abilities to develop a small business, or provide contract services. Anyone who is technically inclined can rack up credentials and certifications as quickly as they’d like to progress into earning a living.The contracting arena is a wide net. It casts out primary and secondary players like those who need a product or service, and those who can provide it. In between are other entrepreneurs. Proposal or grant writers, for example, are another cottage business. Much like an artist and a technical person, to step into this world, you can take an alternate route by demonstrating via portfolio what you can do. To get an edge on competition though, a business should strive to win at least one grant, contract or award for their portfolio, and grow it from there. The internet has enabled many businesses to conduct business via phone, fax, internet, and online meetings. Proposal manager or proposal coordinator staff are responsible for shepherding grants or proposals through the system. Any of these positions can be done from a home base.Despite challenging economic times, the good news is that the best home based businesses are everywhere, where the heart is, and most importantly, at home.
A Guide To The Best Home Based Businesses
Home based businesses are much less complicated to start up with today’s technological innovations than they were a few years ago. And technological innovation is the key if you are looking for the best home based businesses.Some people may be anxious that they have no technological know-how but the world wide web is an easy place to get started with a work at home business if you follow a few simple steps.Affiliate MarketingAffiliate marketing is one of most popular and best home based businesses to get started with. Basically, you promote other people’s goods and services on the internet and, when somebody buys the products or services that you are advertising, you get rewarded a commission by the product owner. You do not have to worry about producing products, holding any stock, dealing with the fulfilment or any client queries.There are so many different items which are readily available to promote. You can find a large choice at Clickbank, a popular online marketplace. It has paid out billions of dollars in commissions to affiliates over the past 10 years. There is no cost to join Clickbank and you can browse through their categories to see which items suit you best.PayDotCom and Commission Junction are two of the other big online networks who specialise in digital products and of course there is the Amazon online programme if you are interested to promoting actual physical items.Online Information MarketingInformation marketing is another one of the best home based businesses available today. If you have information about a particular topic it can be turned into extra income. People use the world wide web to look for information and are willing to pay for it. You do not need to be an expert, just so long as you know more than a regular person on your chosen subject. If you do not think that you have any useful information then you can go and talk to experts and then transfer that information online for sale.Education and TrainingThe owners of the best home based businesses have all been prepared to learn new skills and techniques for their work from home jobs. You would not expect to start a new job in an office, store or factory without another person showing you what to do, so why should your work at home business be any different? You have to make sure that you are up to date with your marketplace and know about the techniques used to attract new customers and retain existing ones. All of the best home based businesses require continual knowledge and training if you are to succeed.It is a well known fact that over the past years there has been a surge in the number of individuals buying goods and services online. As this trend continues to grow it is the online businesses that provide the greatest opportunities for the best home based businesses.
Health Reform Changes Affecting Small Business
“Don’t tax him. Don’t tax me. Tax the guy behind the tree”- attributed to Former Congressmen RostenkowskiOwners of small businesses and their workers could be severely impacted by the recently enacted health reform legislation. Some key provisions related to tax credits, new excise taxes, penalties, and some higher taxes, all of which depend on a number of factors such as number of full time employees in the business, average incomes of the employees etc. This article will provide you an overview of its significance to self employed taxpayers who have less than ten full time employees.Generally, the present Obama administration and Congress have noted that the new health reform proposals will provide better insurance for small businesses at a lower cost, which will create more jobs. However, there is also a lot of strongly negative feelings among the business community. Let me present some of the provisions so that you can judge for yourself and plan accordingly.Benefits to small businesses: Despite the negative press about the law, there really are some positive changes that will affect small businesses.
Small Business Exchanges: Small business will be able to pool their resources in state exchanges called “Shop exchanges” in order to buy insurance. Normally these exchanges apply to companies who have less than 100 employees by 2014;however, states have the option to limit access to these exchanges for companies of under 50 full time employees. Premium expectations are expected to reduce overall insurance costs by 1-4% per year for each employee, which is a very good provision under this plan.
Tax Credits for certain small employers who provide insurance. Generally, if you have fewer than 50 full-time employees, you don’t have to provide health insurance for your workers. However, if you do provide insurance, you might be eligible for a yummy tax credit, which is a dollar-for-dollar reduction in your taxes.
To be eligible for this credit, you have to have less than 25 full-time employees whose annual average earnings (not counting the owner) of no more than $50,000. For companies of 10 or fewer employees, you would be eligible for a 35% tax credit (which goes up to 50% after 2013) in later years, if your average full time equivalent wages are less than $25,000 per year. This credit begins in 2010 and goes till 2014. There is a second phase of the credit that small business would get up to 2016. Thus, qualifying small businesses can get this credit for up to six years.Sandy’s elaboration: This credit sounds great, but having it apply to small businesses (of no more than 10 full-time workers) and who average under $25,000 of wages will substantially reduce its applicability to most businesses. Estimates are that this will benefit about 7% of self employed businesses.
No more lifetime caps: For most health insurance, there is a $2,000,000 lifetime cap for usage. Starting immediately, these caps are to be removed. This could allow coverage for a number of small business folks who might have exceeded the cap.
No pre-existing conditions: starting in 2014, there will not be any pre-existing conditions. Thus, even if you have a major medical problem, you will be guaranteed to get health insurance. This is a great provision that will allow coverage for those small business folks and their employees who might not have been able to get insurance coverage.
Dependent children can be kept on parent’s insurance through age 26: Normally, kids who turn age 21 have to get their own insurance and can’t be kept on their parent’s insurance. This will be changed so that dependent children who are under age 27 can be kept on the parent’s insurance. This becomes effective on March 30, 2010. I should note that although dependents under age 27 can be added to the parent’s insurance e policy, there is no requirement that an employer add them to the policy.
Small Businesses are exempt from penalties for failing to provide health insurance: Generally only companies that have 50 or more full-time employees need to provide health insurance coverage or face penalties. However, since small businesses of under 50 full-time employees don’t need to provide any coverage, they are exempt from these “Pay or Play” penalties.
Sandy’s elaboration: If you have a business with 50 more more full-time employees, you are indeed required to provide health insurance.As you can see, there are some good provisions for both the business owner and for small businesses. Thus, why the strongly, negative comments from the business community? The reason is that there are a lot of congressional “gotchas” that affect everyone.Problems with the healh reform legislation
New taxes: There are a number of new taxes and costs that will beef up the overall insurance costs for small businesses. For example, there is an income tax increase starting in 2010 of between 5%-10% for those who make over $200,000 of adjusted gross income. In addition, Medicare has been increased for everyone by.9% for all employees and for the owner who make over $200,000 of adjusted gross income and is single. Married taxpayers filing joint returns have to make of $250,000 of adjusted gross earnings in order for this.9% Medicare surcharge to kick in. This may not sound like a lot, but, for someone earning $300,000 in salary, this could result in a $900 increase in Medicare taxes for each employee in that income bracket regardless of profitability of the business! In addition, if the adjusted gross income of the worker or the owner is over $200,000 ( for single taxpayers) or over $25,,000 (for married filing joint taxpayers), there will be a 3.8% Medicare surcharge on all of their interest, dividends, rents and royalties. This will also apply to dividends from S Corporations. So much for saving costs!
New excise taxes: In order to help pay for this new law, there are some additional excise taxes on many medical devices that ordinarily aren’t purchased by most people. Thus, there will be no excise taxes on glasses, hearing aids, and contact lenses. Most other devices, however, will probably have the excise taxes apply to them. In addition, there will be additional taxes on the health insurance companies, some insurance plans and pharmaceutical companies. You might wonder how these additional taxes apply to self employed taxpayers. The reason is that these additional costs will be passed through to everyone including the self employed.
Additional 40% excise tax on Cadillac health insurance: The new law places a whopping 40% excise tax on high-cost employer-sponsored health coverage, often referred to as “Cadillac” health plans. This tax applies to premiums that exceed $10,200 for single coverage and those that exceed $27,500 for family coverage. There are some increased thresholds for retired taxpayers who are age 55 and older and for those engaged in “high risk occupations.” Thus, if you want top notch expensive insurance coverage, you will pay a lot more to get it. This even assumes that an insurance company will even offer it at all.
Increased paperwork: Generally those who do provide insurance through the exchange for their workers will need to fill out some potentially new paperwork showing the name of the employee, the amount of premium paid the contribution by the employee, notification to the employee about the coverage etc.
Midsize to large companies much provide health insurance: If you have a company consisting of 50 or more full- time employees (part time will be counted on a fractional basis depending on their hours), you are required to provide medical insurance or face big penalties. However, this is required regardless of profitability. Think about this. This could result in a number of unprofitable or marginally profitable companies going broke, which could actually substantially reduce jobs. In addition, this would spur either the hiring of more part time at the cost of reducing the number of full time employees or increase the sucking sound of companies going to places like China or India. The result of all this would mean a lot less jobs.
Bottom Line: Although there are some great provisions in the new law such as waiving pre-existing conditions and lifetime benefit caps, the increased taxes and costs incurred for most small businesses will probably exceed the decrease in health premiums resulting in an overall increase in total health costs and taxes to self employed businesses. Thus, I don’t see any job creation resulting from this law. In fact, it may well cost a lot of jobs.P.S. Check out my free lesson on “How to write off all your medical expenses!” Free Lesson http://www.PocketbookProfessor.comBy Sandy Botkin CPA. Esq
Here Are 3 Questions in Regards to Internet Marketing
When you engage in something that is totally new, it can be exhilarating, fun and even down right frustrating and confusing. The same thing can be said about internet marketing, because it pertains to your internet business which can either make or break you if you do not fully understand the very basics of internet marketing.
What makes it even more frustrating is that you spend all that time and effort trying to get your internet business going and the next thing you know it, your business is going no way because you did not fully understand of what internet marketing is and how it can greatly influence your income.
Before you proceed to the next portion of this article, you need to ask yourself these 3 questions on how you can better understand what internet marketing is ad they are:
A. What is The Definition of Internet Marketing?
B. How much will it Cost Me?
C. How Will Going Into Internet Marketing Benefit Me?
What is The Definition of Internet Marketing?
If you look how a business is run, you will see how marketing plays an important role in the success of a company. The main definition of marketing is that starts out as a simple idea, item or organization. When you take a look at the bigger picture, it covers everything from advertising, market researching (which is very critical because a company must need to know who to market to or else they would be throwing away a lot of money), customer service (gaining and retaining) and putting out more products that will benefit the customer.
Virtual internet marketing runs on the same ideas, but in a different format. Marketing in this sense pertains to writing articles, banner advertisement, e-mail marketing, posting unique content on a website, SEO’s, affiliate marketing, list building and auto-responders and other e-commerce stuff.
How Much Will It Cost Me?
It all depends on the methods of promotions to choose from, paid or free. This is where setting up a budget and a well-defined business plan, with long and short-term goals, will come into play.
There are many options that are now available to the new affiliate marketer so that they can start building websites or create a blog for free. Starting an internet business can be run with little or no money invested from your own pockets, but there are times in which you will have to pay for advertising so that you can get your business to the media. The way that I have found out is to start small and work your way up the financial ladder. Once the money starts pouring in from affiliate commissions and then you can start paying for internet tools and programs that will help your business even further.
How Will Going into Internet Marketing Benefit Me and My Business?
Being a stay at home has its benefits as I am able to be with my children more and help them out with their homework and just simply spend more time with them. For you, the reader, you probably have other things in mind.
Your business will also benefit from internet marketing in a way that you have never thought of before. Here is a word that I want you to become familiar with; it is called auto-pilot. Here are some ways that you can set your website(s) or blog(s) on automatic:
1. Article marketing
2. Newsletters
3. Banners
4. Adding text links on your website
5. E-mail Marketing
There are probably many more that you can think of, but these 5 ideas that I have listed are critical in your marketing efforts. You will gain the trust of your customers as they will see that their desires are fulfilled. This what article marketing can do for you and your internet business.
You are ready to begin you internet marketing career now that you have the results to these 3 questions and gain success with your business venture.
Different Types of Advertising
The purpose of advertising is to promote a product or service in order to increase sales and create a branding of the product so that a customer loyalty base will be established. Without effective and targeted advertising, a business cannot succeed. There are many types of advertising a business can utilize in effort to increase their sales.
The following lists a number of types of advertising available to businesses:
Television and Radio
Since television was first introduced, businesses have had tremendous success using it as an advertising medium. This is due to the increase in consumers watching television. The cost of television depends on the time of day or night one advertises, the popularity of the television show (how many viewers,) and the length of the advertisement. Television advertising can reach millions of people. Radio advertising is a traditional advertising format that uses voice and jingles.
This includes newspapers, magazines, fliers, brochures..etc. Placing advertisements in magazines and newspapers is an age old method of advertising. Newspapers and the magazines sell the advertising space. Prices depend on location, size, graphics, and color. Advertising success often depends on the number of subscribers. Print advertising allows a business to target a specific demographic. Fliers and brochures are a great way to advertise sales and launch special product promotion programs.
Internet Advertising
Online advertising consists of small ads, banner ads, text ads, video ads, pay-per-click advertising, and reciprocal linking to other websites. The effectiveness of online advertising depends on exposure and how many people actually view the advertisement. Internet advertising allows the advertiser to track the number of impressions an ad gets (how many people see it), and how many visits their business website receives from particular ads, making it simple to find out what kind of conversion rates the advertisers are obtaining. Online advertising does not have any time restraints and can be viewed day and night throughout the world. Businesses also have their own websites as an advertising tool. A well-designed and well-promoted website can provide a world of customers.
Out-of-Home Advertising
This can include digital signage, billboards, kiosks, tradeshows, and out-of-home advertising. This is advertising that takes place outside of a customer’s home. This form of advertising has become very popular because it provides a new way to reach targeted customers. Billboards, kiosks, and tradeshows have been extremely successful advertising tools because you can take your product or service directly to the consumer. Digital signage is a newer method of advertising that is growing in popularity. Digital signage is where monitors/plasma TVs are placed in strategic locations and display advertisements directed at their targeted customer. Digital signage can deliver messages in the form of text and digital video. Advertisers have the ability to up date content from a remote location. You can find digital signage in such places as sports arenas, retail stores, department stores, malls, schools…etc.
Regardless of the state of the economy, businesses have to keep advertising to stay successful. Because of the broad range of advertising methods now available, businesses now have the ability to reach their targeted customers at very affordable costs.
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.