It Is Time To Order Your Inventory

Once all the preliminary work is done, it is time to order your inventory. You have found the perfect location, checked out the zoning ordinances, talked to other business owners, and signed the lease. All that is left to do is stock your business, advertise, and stand back from the door so the crowd does not knock you down on the way in to purchase everything in your store.

WRONG! It usually does not happen that way. It would be great if it did, but then everyone would open a business and then where would we get the customers. The next step in a long line of steps is to locate the best wholesale sources for the items that you want to sell. This can be very time consuming.

Just this morning, I googled wholesale and wholesale distributor and there were over 13,000,000 and almost 3,000,000 respectively listed. How in the world can one search through that maze to find exactly what they are looking for? Buying items at wholesale prices and then expecting to turn around and sell them immediately is not a quick way to get rich. But, overall, the small business owner makes more money than the average person that works for someone else.

It is not an easy task to locate a wholesale distributor that will be able to deliver the goods at the best possible price. I believe that the small business owner should begin by searching on the internet; however, that should not be a stopping place.

Each year, many major cities have wholesale shows where hundreds, if not thousands of wholesalers come to one location and buyers from all over the country come to see the latest trend and purchase stock for their store. Las Vegas, several times each year, has perhaps the biggest merchandise show in the country, if not the world. Chicago, New York, and Atlanta also are big wholesale merchandise shows. There are several smaller distributor shows throughout the year and at various locations. Once you begin dealing with wholesalers that you have found through the internet, most companies will tell you when and where they will be set up so you can view the merchandise.

Many companies have online catalogs that you can order from directly. This is also convenient because you do not have to go anywhere and you can know if it is still in stock. However, I have found that it is better if you can see the merchandise at a show, but if you are making reorders, or are in a hurry for some items, this is perhaps the best way to go.

Even though you can order online, at least the first time, I recommend calling and talking to a salesman. Usually, they are friendly and really want to help you, because they get paid on commission. Also, when you deal with a salesman, you have someone to talk to if something is wrong with your order, or it is late. After a few times of dealing with the salesman, then it is fine to just order online. But remember, if a salesman knows very much about your business, if he has some specials that may save you money, he will let you know while you are talking to him. He is there to help you make money, so he makes money. Never underestimate the benefits of talking directly with salesmen.

Finding good wholesale sources will take some time, but there are several sources available that will help to make it easier.

There are several more aspects to dealing with wholesale distributors that I will talk about in later articles. This includes how to ask for a better deal, buying surplus and closeouts, and shipping costs.

Paul Taylor is a business owner that helps other business owners and entrepreneurs locate wholesale distributors and dropshippers. Visit his website www.WholesaleMap.com for information about wholesale sources or opening a business.

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License Required

Before you can open for business, you must first get a license. There are several types of license that may be needed before you begin operation. Without the proper permits, you may be operating your business illegally. Most businesses need a city or county license. There may also be other requirements from the state or federal government for certain types of licenses.

Most states require a special license to sell firearms. Some may even require one to sell gasoline, tobacco, and liquor. Certain professions also require special licenses. They include Real Estate Agents, Auctioneers, Appraisers and Contractors. Some businesses require a federal license, such as, manufacturing tobacco, alcohol or firearms. TV and Radio stations also must have a federal license.

Most small business licenses are pretty easy to get. First start with your County Court Clerk. If you are locating in a city, the city clerk should be able to point you in the right direction. To purchase a small business license, you usually must pay a fee, which is normally a minimal charge. However, getting some licenses may be more complicated. The laws for selling firearms are very different from the laws for selling groceries.

What name you put on the business license is also very important. Once you register your business name, that name legally is yours, however, in some states, unless your business is a corporation more than one business can use the same name. Using a business name allows you to open bank accounts, receive checks written to your business and give you an identity to your customers.

Today, most banks require you to have a business license in order to open an account in a business name. A business should have a separate account. Even though there is a little more expense by having a personal and business account, most business owners agree that bookkeeping is much easier with separate accounts.

One other permit that is required in order to open a business is a “certificate of resale.” This allows you to collect the state sales tax from your customers. Without this permit, most legitimate wholesale companies will not allow you to purchase items from them. This certificate shows that you are purchasing items from them with the intent to resell the merchandise to another customer.

Once you make a sale, you are required to collect sales tax from the customer. At the end of the reporting period, which can vary by state, the business owner is required to file a report with the state and submit the taxes that have been collected. Most states do not usually tax services such as lawyer fees and accountants. The rate of the sales tax varies by where your business is located. Even different counties and cities have different rates. Your state Department of Revenue will give you information about the rates each area has and what the requirements are for applying for a certificate of resale.

Some business owners are required to get a Federal tax ID. It is also known as Employer Identification Number or EIN. This number identifies your business on government forms. If your business has employees or is a corporation, it is required that you receive an EIN. There are other situations that an EIN may be required that your accountant can help you determine if you need one or not.

To receive an EIN, you must contact the Internal Revenue Service. However, it is easy to apply. Contact your local IRS office for information about how to apply.

Once you have all of your licenses and certificates in order, picked out your location, verified any zoning ordinances, you are almost ready to open for business.

Paul Taylor is a business owner that helps other business owners and entrepreneurs locate wholesale distributors and dropshippers. Visit his website http://www.WholesaleMap.com for information about wholesale sources or opening a business.

To Lease Or Not To Lease

When you have finally decided what your business will be, what type of organization you will have (sole proprietorship, partnership, or corporation), and where you want your business to be located, the real work begins. You must now decide whether or not to lease or buy property. There are several factors to consider when determining which route you should take.

Of course, perhaps the biggest factor to consider is MONEY. It takes a lot of money or credit to purchase a building; money that could be used to purchase inventory, pay employees, or help you out during the slow times. But if you cannot afford or don’t want to purchase a building, the next option is to lease the property.

A lease is nothing more than a contract between an owner of real estate and the tenant. In legal jargon, the owner is called the lessor and the tenant is called the lessee. A lease is usually for a specified amount of time. The lease specifies how much the lessee will pay for the use of the property. There are several other stipulations that leases cover, such as what type of business can be on the property, who pays for repairs, when the rent is due, who pays the taxes, and many other aspects to a lease.

In most states, for a lease to be enforceable, it must be written and signed by both the lessor and the lessee. A verbal lease for one year or less may be enforceable, but it is better if all leases are written down. There should not be any disputes if the lease is in writing.

One type of lease that most retail stores use is a Net, Net, Net or NNN lease, also known as triple net leases. This means that the tenant will pay the taxes, insurance, utilities, and repairs. In a triple net lease, the tenant pays all expenses associated with the piece of property that is leased.

In any long-term lease, you should hire a lawyer to help you to negotiate the lease. Leases are not static; in other words, changes can be negotiated. Length of time, who pays for what expenses, amount of the rent, and what day the rent is due are all items that can be negotiated.

The first lease should never be more than a year in any small business. There are several factors to consider. Your business may not be successful in this location, and you do not want to be stuck in a lease that you cannot pay. A short lease also provides the opportunity to find out that you may need more space than you originally anticipated. If you are involved in a longer lease, you may not be able to expand when it is necessary.

Before considering signing any lease, talk to other tenants in the area about the amount of rent that is usually paid. Rent varies tremendously in certain areas, and you do not want to pay more for your lease than is typical for the area.

Signing a lease is a huge commitment. Do not take this step lightly. Check out the area that you want to be in. Ask questions of other business owners about the area. Talk with the people that will be shopping with you. In essence, “Do Your Homework.” Remember that if the location that you want does not feel right, it probably is not right.

This is your business; so do not let others try to convince you that this is the right place. You make the decision because you are the one that will pay the bills.

Paul Taylor is a business owner that helps other business owners and entrepreneurs locate wholesale distributors and dropshippers. Visit his website http://www.WholesaleMap.com for more information about wholesale sources or for more information about starting a business.