But what if you don’t have the money you need?

The good news is that you can start a business on a shoestring. You just have to know how to booststrap it. First of all, realise that you won’t be able to boostrap a business that requires a lot of equipment and high startup costs. Think about your business idea, and what it entails. If you are operating on a very small budget, you will need a business idea that has relatively low costs.

Once you know that your business idea is compatible with boostrapping, you can use these 7 tips that can help you make it work:

1. Start Small, No Office

Renting office space can get real expensive, real quick. If you are bootstrapping your business, it’s a good idea to start small, without an office. You shouldn’t rent an office until you have managed to expand to at least two employees. You can start in your home, or you can start in a coffee shop with wi-fi. There are also inexpensive co-working arrangements that can work so that you don’t have to rent an office.

2. Barter

Consider bartering for the things that you need. You can trade some of your products or services for what you need. You might be surprised at the business barter networks that have sprouted in recent years. If you are looking to better your business, bartering really can be a good way to go. You don’t need to use cash, and you get what you need.

3. Get Quotes for Business Insurance

Depending on what type of business you are running, you might need business insurance. Consider different types of insurance, and get a quote. In some cases, if you need the insurance, it’s best to just get it, rather than run the risk that a lawsuit or some other problem could complete destroy your fledgling company.

4. Test the Market for Your Product or Service

Before you invest in office space, or a brick and mortar storefront, test the market for your product or service. See what kind of demand there is. This means that you should take a product to a festival or to some sort of open air market first. You’ll be able to better gauge demand when you test out the product in the “real world.” If demand offline is low, you might want to focus more energy online, or change your product or service.

5. Use Social Media to Spread the Word

An essential part of boostrapping a business is to use any free channels you can to spread the word. This can include a social media strategy that helps get the word out there, and raise awareness for your business. Facebook, Twitter, LinkedIn, and even smaller niche sites can all draw attention to your business. Target appropriate social networks, and involve yourself in them. You’ll build community and find customers.

6. Look the Part

If you will be making presentations to others, you want to look sharp. Rather than by several mediocre or poor quality suits, spend your money on one high quality suit. It’s worth it to look good when you go into a meeting. You want to project an image of someone who knows what he or she is doing, and a nice suit is a big part of that. Don’t forget to properly groom yourself so you make the right impression. You may be boostrapping, but you want people to focus on your great business idea, and not on your lack of funds.

7. Apply for Alternative Financing

You can also apply for alternative financing. Crowd sourcing and P2P lending are both great options when it comes to bootstrapping. If you can’t get financing from the bank, these resources can help you get a little money for startup. Also, with the right crowdsourcing sites, you can offer your product or service in exchange for a little funding help. You can also use a small business credit card to help you manage your cash flow as you get started.

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Don’t Miss Out on These Business Tax Deductions

The great thing about business tax deductions is that you can add them up all year, whether you own a growing small business at an on-site location, or whether you have a home business. Don’t think that running your legitimate business out of your home prevents you from taking the tax deductions that are available to you. Here are some of those tax deductions, according to the CRA:

• Advertising: Deduct the cost associated with advertising your business. This can include online advertising and marketing costs.
• Fuel costs: Deduct what you pay in fuel.
• Insurance: When you pay insurance on your building, or fleet vehicles, you can deduct the costs.
• Legal fees: Deduct the fees for the legal advice you receive.
• Eligible maintenance and repairs: These items you pay for with regard to the upkeep of your business building and equipment can be deducted.
• Meals and entertainment: If you take a client out, you can deduct some of your expenses.
• Equipment and supplies: Buy office equipment and supplies, including furniture, computers, paperclips, and other items, and you can deduct those costs.
• Utilities and telephone: Don’t forget what you pay in these costs can also be deducted from your taxes.
• Taxes: Quite a few of your taxes can be deducted as part of your business expenses. Property taxes, business taxes, and even HST can be deducted.
• Salaries: The money you pay to workers is tax-deductible as well, meaning that salaries, or even contract pay, can reduce your income. Benefits paid are also tax-deductible, according to the CRA.

There are other expenses as well. Do your best to keep your business and your personal expenses separate, so that it is clear which items are business, and which items are personal. Remember that only your business expenses are tax deductible.

Use a Business Credit Card

One of the best ways to ensure that your business and personal expenses remain separate is to use a business credit card. Your Canadian business credit card can provide you with an easy way to keep up with your business expenses. The credit card statements can help you easily and accurately track your expenses, so that you know how much you have been spending. Additionally, it can add that extra layer of separation between your personal finances and your business finances. Make sure you are careful to only use your business card for business purchases, and don’t mingle your expenses. It’ll be easier come tax time, and you’ll have fewer problems with the CRA.

The post Own a Small Business? Don’t Forget These Tax Deductions appeared first on CreditCardsCanada.ca.

Canada’s Competition Bureau is arguing that the high fees that Canadian merchants pay for accepting credit cards is unfair, especially since the cost of the fees are passed on to consumers. Even those who use cash end up paying, in some way, for these high fees. Canadian Business reports on the impact of high fees:

Presenting the case for the competition commissioner, Kent Thomson argued that restrictive contracts put in place by Visa and MasterCard allow the two credit card companies — which represent 92 per cent of the market — to essentially dictate terms to merchants.

“Most Canadians are unaware of the high cost of fees” that are part and parcel of credit card usage, he said. “And these are not borne by merchants alone, they are reflected in higher prices paid by customers.”

Indeed, Canadian credit card use costs everyone, no matter how responsible you are. Some think that the credit card issuers are behaving in a draconian fashion, forcing high costs on everyone, whether they are using premium cards or not, because merchants aren’t allowed to charge different prices for cash-pay customers, regular card holders, and premium credit card holders.

Tribunal Hearing Evidence on the Subject of Credit Card Fees

Because of the high fees, a complaint has been filed against credit cards, and the Competition Bureau is holding a tribunal on the subject. Retailers want to be able to use a surcharge on credit purchases, in an effort to raise awareness of the costs associated with using credit cards. They want to make it clear that everyone pays higher prices when credit cards are accepted at a store.

Due to the popularity of credit cards as a payment method, most retailers have little choice but to accept them. But they wish that they could show consumers the cost — even those who pay cash and have low interest credit cards pay the price — of credit cards. Additionally, they claim that they want to be able to account for the costs associated with credit cards without passing the higher prices on to customers paying cash, or customers that don’t use the premium credit cards.

On top of that, it seems as though the fees also cost the Canadian government $60 million over the course of five years. This news indicates that it’s not just consumers that pay the price; you could avoid stores altogether, and you would still be paying credit card fees through your taxes. While many understand that credit card fees are necessary for the major issuers and the credit card companies to make money, there are questions about why the terms have to be so inflexible, and why Canada has to pay some of the highest fees in the world.

What do you think? Should credit card companies and issuers be forced to change the fee structure?

The post Canadians Pay High Fees for Credit Card Use appeared first on CreditCardsCanada.ca.

Is Someone Stealing Your Business Identity?

One of the big worries that you might have is someone stealing your business identity to get credit. If you are an established business, someone else might try to use your good name and long years in business to get credit. Once that credit line is established, it’s then possible for the fraudster to enjoy the fruits of your labors. NPR explains the problems associated with this type of business identity theft:

[S]hady operators go after information to tap into business’ credit and reputation. They change a business’s contact information, for example, then use it to obtain credit cards or order goods, skipping town before bills arrive.

Another problem is that some business identity thieves purposely try to mimic a legitimate business. This type of identity theft involves setting up a business name that is similar to an already-existing business. The NPR article cites a problem with AAA Termite & Pest Control. This business ran into trouble with impostors in the phone book calling themselves AAA Pest Control. At first glance, it might look like the legitimate business. However, once a customer calls, the identity thief answers — and takes the business.

In some cases, this type of identity theft is just about stealing customers. In other cases, though, a sound-alike business just tries to scam the customer. The fraudster might provide shoddy work, or not even truly perform the agreed-upon services. The customer pays, and your business is blamed because the names are so similar. Some of these types of fraudsters even go so far as to adopt similar colors to what your business uses, and may even create a similar logo. Customers think they are doing business with you — but they’re not.

Your Business Reputation

In both cases, your business reputation is on the line. Your business credit can be ruined by unpaid bills opened in your name, and without your knowledge. Your reputation in the community can be sullied by negative reviews given by customers who were bamboozled by these scammers. It’s important that you be on the look out for business identity theft.

In some cases, it can be difficult to rectify the situation. If a look-alike scammer has a number in the phone book it’s too late to have the listing removed. You can ask for a cease -and-desist if someone is using your identity to set up a web site, but that can still be a difficult situation. The best you can do is try to vigorously defend your copyrights, and raise awareness of the issue.

You should also keep up with your business credit. There are business credit reports available from D&B Canada, Equifax Canada, Mercantile Credit Bureau and Groupecho Canada Inc. Periodically check your reports so that you can see whether or not new credit has been open in your business name. You need to keep on top of this information so that you know what is being done with the financial reputation of your business.

The post Watch Out: Business Identity Theft is on the Rise appeared first on CreditCardsCanada.ca.

Even if you have a good idea, it might be hard to find financing. One way you can improve your chances is try P2P lending, or some sort of crowdsourcing. You can usually get reasonable interest rates, plus you might be able to find someone willing to take a chance on you.

What is P2P Lending?

P2P lending is when you get money from someone else — “regular” folks like yourself. You can use a site like Prosper or Lending Club to look for loans. People can lend you money, in increments as little as $25. This allows you to get the funding you need, with lots of small loans adding up.

However, most people on P2P lending sites aren’t going to just lend you money. You have to convince them that your business is worth it. Some of the ways that you can increase the chances that you will find lenders include:

• Share a business plan: Lay out your business plan, and you will have more luck. Lenders want to see that you have thought things though.
• Share your story: You don’t need to go into great detail, but sharing your story, at least a little of it, can be helpful to your cause. Add a little humanity, and share what you hope will happen with your business.
• Let them know what you’ve already done: If you have skin in the game, let potential lenders know. Share information about what you have already done in terms of your own investment, as well as other information about how far along you are.

You want to show that you are a risk that is likely to pay off. Then you will be more likely to get the financing you need for your business.

Crowdsourcing

Another option is to consider a crowdsourcing site. Kickstarter is a great option, since it allows you to raise money for your business idea. Most of the ventures on Kickstarter are more creative, so keep that in mind. Crowdsourcing provides you a way to earn money, and you provide something for those who provide funding. You can offer free products, ownership in the company, or some other perk. You don’t usually have to pay back the money, since it’s not a loan, but you do need to provide something to encourage people to fund your business. There are other crowdsourcing sites that you can visit, depending on the type of business you are starting.

Credit Cards

You can also fall back on credit card financing. There are business credit cards aimed at helping small businesses pay for what they need. You have to be prepared to pay higher interest rates, though. A business credit card can help you bridge the gap while you wait for other funding, and you can also use it to build business credit.

Carefully consider your financing options when trying to start or expand your business. Chances are that you will need to combine a number of options in order to ensure that you get the money you need.

The post Financing Your Business? Consider P2P Lending and Crowdsourcing appeared first on CreditCardsCanada.ca.

The following infographic offers some insight into what Canadians are doing with their money online:

As you can see, the most popular orders are for travel. And that makes sense: Booking travel is much easier online than in other venues. You can even use travel rewards credit cards to ensure that you get the most bang for your buck.

It’s interesting that many Canadians buy online from Canadian retailers. There had been some anecdotal stories about them “going” to the U.S. for their online shopping, especially for Black Friday sales. But with Canadian retailers getting in on the act, it appears that it easier for Canadians to keep their dollars here.

The trends keep showing that Canadians are getting ready to embrace a cashless lifestyle, and that they are interested in technology to make shopping, and other financial transactions easier. While Canada may never quite catch up to the U.S. in terms of raw numbers, the percentage of Canadians shopping online may soon be on par with our neighbors to the south.

The post Canadian Ecommerce By the Numbers [Infographic] appeared first on CreditCardsCanada.ca.

The good news is that a kit has been developed to help small businesspeople accept credit cards and debit cards. Kudos, a system from NetSecure Payments, turns mobile devices and computers into payment terminals.

Turning Your Smart Phone Into a Credit Card Terminal

You can use your smart phone, tablet, laptop, and/or computer to accept payment. The kit can be bought for less than $100 in the U.S. and Canada, and comes with a merchant account. You can receive account statements, and manage your account in other ways with the kit. Instead of paying a monthly fee, a flat 2.7% of the purchase price is assessed, along with a per-transaction fee. But, overall, it’s quite affordable. Plus, the kit offers encryption, so the transactions are secure.

There are apps you can purchase for mobile devices, allowing you to process payment. These types of apps might require you to set up a merchant account separately, or they might have payment options similar to the Kudos kit. The main difference, though, is that the kit from Kudos allows you to swipe the debit or credit card, rather than a need for typing in the information.

The Future of Credit Card Payments

Of course, with the advent of digital wallets, and with the development of near field communication technology, it seems likely, though, that at some point physically typing information, or swiping it, might no longer be necessary. It is likely that further developments could be even more helpful to small business owners, allowing them accept payment digitally, from someone whose phone acts as a credit card. But, for those customers without digital wallets — who still carry plastic — having something like the Kudos payment system might be useful.

The post Kudos: Accept Credit Cards from Your Mobile Device appeared first on CreditCardsCanada.ca.