How to Start a Home-Based Promotional Supplies Business

Tuesday, April 30, 2013

How to Start a Home-Based Promotional Supplies Business

Starting a home-based promotion supplies or advertising specialties business can be exciting and fun. You will be selling items such as key chains, coffee mugs, T-shirts and calendars with corporate names and logos. Schools and small businesses such as restaurants are also potential customers. It is best to sell promotional supply items through an established direct sales organization, such as Kaeser & Blair or Advertising Specialty Institute. Startups costs are minimal.

Step 1

Set up an office in your home with a computer, printer, fax machine and file cabinet. Use a revenue/expense ledger to keep track of all sales and expenses.

Step 2

Create a business name for your promotional supplies business. Use a name like Jones Advertising Specialties, which is highly descriptive. Register your doing business as through your local county or city administration office, according to Business.gov. Apply for a vendor's license at the same time, as you will need to pay sales taxes on in-state customers.

Step 3

Reference business opportunity magazines, such as "Entrepreneur" or "Small Business Opportunities," in search of promotional supplies direct sales companies. Check for advertising specialty companies online through search engines, such as Google.com and Yahoo.com.

Step 4

Call some of the promotional supply direct sales companies. Find out if your potential supplier will ship orders out for you, which will keep your inventory costs down. Choose the promotional supplies company that offers you the best commissions or lowest per-unit costs. Make sure your direct sales company sells a large variety of your preferred products.

Step 5

Ask your promotional supplies company if they provide a website for your customers. Plan on using this website for customers to place future orders from you. Include your website on all business cards, brochures, catalogs and order forms.

Step 6

Call corporations, schools, restaurants and churches. Talk to business managers, principals, owners and pastors, respectively, about ordering promotional supplies from you. Set up appointments to visit these types of individuals in person.

Step 7

Take a catalog, brochures, business cards and order forms with you on all sales calls. Fill out an order form when people order from you. Leave a brochure, business card and order form behind if an individual needs more time before placing an order.

Step 8

Take all orders home with your each day. Place individual orders for people through your direct sales company. Just provide the direct sales company with the name and address of each customer. Allow the direct sales company to ship all of your orders out to customers.

Step 9

Place classified advertising through your local newspaper. Invite people to visit your website or call you for additional information.

Step 10

Make sure you pay income taxes on your profits. Be aware of the deduction you can take for using your home office for business, according to the Internal Revenue Service.

Things Needed

Tip

Contact your best customers every month or two to see if they need more promotional items. Take an order over the phone or thorough your website if the business has wants to order again. Contact all companies about any knew products that you are marketing.

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Easy Tips and Ideas to Start Business

Although anyone can start a business, many people fail because of a bad product or improper research. If you want to start your own business, you can improve your chances for success before you even begin. In order to make your business successful, start strong and make sure that your idea will hold out for the long haul.

Have a Good Product

Ensure that you plan to sell something useful. Although you may think that your product is important or special, that doesn't mean the general public will agree. Ask friends, family and strangers what they think of your product. If they don't seem that interested, ask them why. With their suggestions, you can either improve the product or scrap the idea completely. According to Brad Sugars of Entrepreneur magazine, most small businesses fail because they sold a product that didn't have an adequate market. This also applies to small businesses that provide a service. A lawn-care business might be useful for part of the year in a northern state, but it is in-demand year-round in the south. Consider whether people will actually want to use your service and get constructive advice from those not afraid to give their opinion.

Research Local Businesses

Research local companies before starting up your own business. This will not only give you an idea of the amount of competition you will have, but it will also help you price your product or service. If you're looking to start a wedding photography business, you may find during your research that the market is over-saturated in your area. If not over-saturated, you should contact each business and ask them for a price list. Alter your prices so you can stay competitive with the competition in town. Researching similar local businesses will also help you decide where to locate your business location. Try not to start up a store or office close to another business of your type. If your small business is located away from similar business types, this will cause locals to choose you over businesses that are farther away from where they live.

Get Professional Advice

You may know someone who has started their own successful business. Ask him for advice and listen to his stories of how he started his company. You may gain useful advice on the good and bad ways to start a business. Local entrepreneurs can also introduce you to local product providers or advertisers that you may not have met without their help. Accept any advice with open arms, especially if the advice is coming from someone successful in the area.

How to Calculate Business Start Up Costs

Starting a business in no easy endeavor. It takes a great deal of research, perseverance and hard work. While sweat equity will make your small business more successful, you will most likely need real capital to get the business started. Before you start raising capital and/or investing your own funds, the first thing you need to do is determine the total start-up costs.

Step 1

Determine your costs of sales. For most small businesses this means inventory, the cost of raw materials, manufacturing equipment, shipping, packaging, and warehousing. However, not all businesses sell products. In this case, the cost of sales is primarily the direct labor involved in making the sale. For example, to open a small shoe business entails purchasing enough inventory ($10,000) to stock the store.

Step 2

Determine professional fees. Planning your business structure, i.e., limited liability corporation or general partnership, means hiring an attorney. There may also be the need to pay an attorney for help with establishing trademarks, copyrights, and patents. In this scenario, that puts total professional fees at an estimated $20,000.

Step 3

Determine technology costs. Technology can greatly reduce the cost of labor for small business if used effectively. Most small businesses require computers, printers, cell phones, website development, Internet access, software applications, information security, data storage, and outsourced information technology (IT) consulting. If the cost of technology is $10,000 to start, add an additional $5,000 a year for maintenance (hint: maintenance is not included in start-up costs).

Step 4

Determine administrative costs. This varies with business types and may include items such as business insurance, office supplies, product packaging, parking, rent, express shipping, desks, chairs, fax machines, phones, or anything else necessary to operate the business daily. A good estimate for start-up administrative costs would be $5,000 for the first six months.

Step 5

Determine initial sales and marketing costs. Now that you have your product, you need to let folks know about it. Sales and marketing costs generally include marketing materials for presentations, printing stationery, business cards, advertising, trade show events, and public relations. These initial sales and marketing costs can add up to $3,000.

Step 6

Determine the wages and benefits needed to secure a staff. This includes employee salaries, benefits, workers compensation, and payroll taxes. Let's put the cost of wages and benefits estimated at $20,000 for the first three months of business.

Step 7

Add all costs associated with starting the business for a total. Be sure to only include business start-up costs that will be incurred in the first three to six months of operations. For this example, the calculation is: $10,000 + $20,000 + $10,000 + $5,000 + $3,000 + $20,000 = $68,000.

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Tuesday, April 30, 2013