Starting a successful home-based business is the entrepreneurial dream. Home-based businesses let you earn a living from the comfort of your home and eliminate the need for costly office space and lengthy commutes (fun fact: commuters spend, on average, 408 days of their life driving to and from work).
Today’s increasingly connected world makes it possible (and relatively easy) to make money without ever stepping outside. The accelerated growth of remote work is a testament to the fact that high-quality performance and strong business results can be achieved without expensive real estate.
Working from home and being your own boss is no longer a pipedream—it’s a realistic future. If you’re on the fence about whether a home-based business is your cup of tea, here are a few pros and cons to consider:
Harder to separate your business and personal life
Possible local government regulation of home-based businesses
Isolation difficult if you’re more of an extrovert
If you’ve decided the pros outweigh the cons and you’re ready to start your home-based business venture—congratulations! Now, it’s time to figure out what kind of business you’re going to start.
Fortunately, you have endless options. To help get your creative juices flowing, we’ve created a list of practical (and profitable) home-based business ideas. This list may contain your dream occupation, and if that’s the case, our job is done. If not, use these ideas to inspire your own one-of-a-kind business.
8 fantastic home-based freelancing careers.
You can start a freelance business as a full-time career or even a side hustle. The limit to its potential is ultimately how much time you can invest in it. Most freelancing jobs you can do anywhere with a computer and a reliable internet connection, so it’s more of an at-home-and-anywhere-else kind of business.
However, the one downside to a freelance business is that you’re not quite the boss. Yes, you have ownership of your hours and pricing, but you’re ultimately fulfilling independent contract work for other businesses—who, by default, become your temporary bosses.
Finding freelance work has never been easier. Here are a few of your options:
Network with friends and family to see who needs help
Connect with individuals and businesses on LinkedIn
Blog posts, guides, email campaigns, social posts, ads, website copy, presentations—words, words, words, and somebody’s got to write them all. A freelance writing business has unlimited potential, but you’ll need a deep-deep passion for writing to avoid burnout.
2. Virtual assistant
Entrepreneurs (like yourself) often reach a point when they need a little extra help—and that first hire is often a virtual assistant. Virtual assistants handle all the nitty-gritty details for businesses from a remote location, such as:
Manage calendars, appointments, and emails
Create and distribute reports
Enter and update data
Execute simple digital marketing tactics
Help with customer support issues
Answer and route phone calls
3. Social media manager.
If you love creating irresistible social media content that generates likes, shares, and comments, then a career as a social media manager may be right for you. As a social media manager, you’ll manage the social profiles for businesses to share messages, gain followers, and interact with the community.
4. Programming
Full-time programmers are hard to find and expensive to hire, making one-off contracts more enticing to small businesses. Programming demand far exceeds the current supply, and it likely always will. If you know how to code, you’ll have no problem finding freelance gigs as a programmer.
5. Graphic design
Graphic designers create everything from T-shirt designs to UX (user experience) enhancements to advertising illustrations. All you’ll need to snag clients is a few Adobe tools, a decent computer, creative design skills, and a portfolio.
6. Photography
Build a home-based studio to do product shoots, portraits, graduation pictures, engagements, weddings, and more. Once you build your collection, you can start selling prints of your photos on your website or through a marketplace like Society6.
7. Personal Trainer
You can do personal training, yoga instructing, wellness coaching, and nutrition consulting all from the comfort of your home. These businesses will provide you with meaningful work as you help change lives every day.
8. Tutor
People will always need help learning challenging topics, meaning you’ll never be short of clientele. Master a trade or skill, become a pro at teaching it, and voilà—you have a tutoring business. Join popular online tutoring platforms like Chegg and Skooli to get started.
6 subscription box businesses.
Subscription boxes are growing in popularity—and they make for a fantastic business model. Instead of fighting for each sale, you earn each customer on a recurring basis, meaning your marketing and advertising ROI shoots through the roof.
Once, subscription plans were limited to magazines, gym memberships, and SaaS (software-as-a-service) services. Now, subscription boxes have expanded this model to include everything from shaving kits to makeup to meals. Regardless of what kind of business you want to start, there’s a good chance you can turn your passion into a subscription box.
1. Crafting
If crafts are your thing, create a subscription service that delivers art supplies, mystery DIY kits, notebooks, or other creative goodies. For inspiration, look at SketchBox, New Hobby Box, and Darby Smart.
2. Wardrobe stylist
Most people aren’t style savvy, but they’re willing to pay extra for someone to help them shop. Stitch Fix is a great example. You could make your subscription boxes broad (general clothes from head to toe) or niche (glasses, watches, shoes, hats, etc.).
3. Makeup
The beauty and skincare subscription box world is saturated, but that doesn’t mean there’s not room enough for you. To differentiate yourself, you’ll need to dial in a specific aspect of makeup or skincare and become the go-to option for it.
4. Supplements
Athletes, weekend warriors, and even your recreational health enthusiasts all need their supplements, and they need them regularly. Protein powders, vitamins, electrolytes—you name it, they probably take it. And not just once—they need it month after month after month, which makes supplements the perfect subscription box products.
5. Games
Playing games is easy, but finding high-quality games is hard. Those who play board games or video games on a daily basis crave the latest and greatest releases, which is where your subscription box comes in. If you consider yourself a gamer, this niche could be right up your alley.
6. Books
Baby books, romance novels, fiction, and true crime—people need books, and most would rather spend time reading rather than sorting through thousands of endless options. Cater your box to a specific niche to win their trust—and their recurring payments.
4 home cooking business ideas.
Who doesn’t like food? If you enjoy making delectable sweet and savory eats from scratch, then the world is your oyster. To sell food, you’ll need to comply with your state’s licensing and regulations. Once that’s covered, you’re ready to start sharing your love of food and drinks with the masses—right from the comfort of your home.
1. Home Bakery
If baking is your forte, then turn on your oven and start working some magic. You could bake and sell muffins, bread, doughnuts, pastries, cookies, cakes, or other tasty treats. And if you want to find an even more specific niche, create specialized gluten-free or healthy bakes.
You can sell your baked goods direct-to-consumer through a website, at your house, or via your local farmers market. If you want to focus on baking and not selling, consider partnering with a local café or shop to sell the goodies on a recurring plan.
2. Cooking Instructor
Cooking is a skill, and it’s one most Americans don’t have. Fortunately for you, if you have the cooking gene, you can teach others as a career. Choose which models you prefer: online or in-person, one-on-one or group classes, private or public. You could even create a digital home-learning course or start a YouTube channel and grow a healthy following to generate ad revenue (see what we did there?).
3. Specialty Goods
Do you enjoy making specialty items that are harder to come by? You could start a business making and selling jams, preserves, coffee roasts, chocolates, confections, or even honey. These kinds of treats sell well online and at fairs and farmers markets.
4. Catering
If you like making food for the masses (and have the appliances to do so), then catering could be a lucrative business idea. You’ll likely need more than just your own two hands to cater for big events like weddings, funerals, graduations, and other gatherings, but you can hire one-off help or get family members involved.
4 home-based business ideas for animal lovers.
An home-based business can be a dream come true for animal lovers. Not only can you focus your life around animals, but you also get to spend more time with your own furry (or not-so-furry) friends. With human fertility rates falling in the US and more of the rising generation choosing to adopt pets into their family, home-based businesses focused on animals will only see growing demand.
1. Pet Bed-and-Breakfast
Everyone loves their pets, but sometimes they need a travel break—which means they’ll need a fun, safe, and reliable place to leave their special friends. A pet bed-and-breakfast lets you score as many clients a night as your home or facility can handle, helping you scale your business quicker than most hands-on pet services permit. Try to partner with local veterinarians, pet stores, and groomers to create mutual referral relationships.
2. Animal Grooming
Grooming a pet is a lot harder than it sounds, and that’s why some people are willing to just defer the task to an expert. Turn a room in your house into an animal salon and start selling doggy transformations.
3. Pet Training
If you’re a talented dog whisperer, pet training may be your gift. You could do group trainings or one-on-ones to transform unruly young pups into well-mannered and obedient canines. At first, you may just provide the basics, like teaching dogs how to sit, listen, stop barking, or shake. As your skills develop, you could also learn the traits necessary to curb aggressive and dangerous behaviors.
4. Dog Walking
Pet owners are busy, and sometimes they need help making sure their furry friends get the healthy walks they need. As a dog walker, you can take dogs out for a stroll every day of the week. Offer customers a subscription plan so you can reduce the time you spend marketing your business and spend more time walking dogs. You can walk single dogs or a small “pack” from a similar residential area to get more bang for your buck.
8 backyard business ideas.
Your home-based business can extend to the backyard, too. If you like spending time outside, consider running a business from your yard rather than your office. Here are a few backyard business ideas to get you started.
1. Backyard nursery
If you’ve been blessed with a green thumb, put your talent to use and start growing potted plants in your garden (or maybe even build a greenhouse). Some people lack the gift—or the backyard space—so they’re much more likely to buy a plant that already has a head start on life.
2. Farming
Create the farm (big or small) that you’ve always wanted. You could strictly grow fruits and vegetables, or you could even get a chicken coop or cows, sourcing eggs or milk to local markets or selling them direct-to-consumer. The only limit is your real estate—and your willingness to get your hands a little dirty.
3. Florist
Beyond food, some people just want to buy pretty flowers. Consider what flowers will thrive in your environment and how profitable they are to grow and sell. Flowers might just be a seasonal component of your larger business to supplement income during special holidays like Valentine’s Day and Mother’s Day.
4. Event rentals
There are a couple of options you can pursue in the world of events. If you have a pretty piece of real estate in a prime location, you may consider leasing it out for parties, weddings, and other events. If you don’t, you could still purchase tables, chairs, music equipment, and other party essentials to store and rent to events going on elsewhere.
5 Goat rentals
Yes, you read that right—goat rentals. You could start a business renting out goats to local property owners who need their lawns mowed. It’s business for you, free food for the goats, and a solution for property owners—everybody wins. Plus, with the recent rise in goat yoga (GOGA), you could also train your lovely grass-eating pets to walk, run, hop, and kiss their way around yoga mats during sessions.
6. Beekeeping
Not everyone is fond of bees, but if you can get past their painful stings, beekeeping could become a fantastic backyard business. Start your bee colony and raise bees for honey production, soapmaking, or other wonderful honey purposes.
7. Furniture upcycling
Shop around at local antique stores, thrift shops, and yard sales to find old furniture that has the potential to be revived. Polish, patch, and upgrade it—then sell the new masterpieces.
8. Car detailing
Start a car detailing business to clean and detail vehicles. You don’t need to be a pro to get started—just begin with what you know. That could be as simple as scrubbing tires, vacuuming the interior, or cleaning up the dash. As you hone your skills and receive the proper training, you can move on to more advanced detailing and protective services—and this opens doors to new services, clients, and vehicles.
Big ideas take a little bit of cash.
And that’s where we can help. Whether you need to finance a computer, photography equipment, home-office renovations, or marketing campaigns, you have options to make it happen.
Find the perfect loan to launch your home-based business with our handy-dandy application. It’s quick, easy, and free—what more could you ask for? Once you submit your application, we’ll help you find the best loan options from our network of 300+ lenders.
Make your home-business dream a reality. Start your 15-minute application now and get access to cash in as little as 24 hours after approval. Your home-based business is waiting. Don’t let a little cash keep your big ideas from launching.
Do you dream about starting your own company? Do you create business plans and product lines in your head, wishing for the day when you can quit your job and create something of your own?
Starting a small business isn’t just a dream that benefits you—it’s a step forward for your community. Small businesses benefit the local economy as a whole, even people who aren’t customers or employees.
Consider these 6 ways starting a local business helps the economy and why your dream of launching a business could have a positive ripple effect.
1. You employ local workers.
The most visible benefit of opening a small business is the employment opportunities you create. Even taking on a few employees part-time can help them pay rent, cover basic expenses, and sustain themselves with a reliable income.
The coronavirus saw many talented people lose income through furloughs, layoffs, and pay cuts. Experts expect to approach the 25% unemployment rate that we saw during the Great Depression.
By launching your business, you can help mitigate the unemployment levels and provide much-needed financial stability. Moreover, employing others will lessen the dependency on state programs (like unemployment benefits or food stamps), allowing your government to help others.
2. You create job vacancies in other companies.
Even if you don’t hire other employees and only run the business yourself, you can still create vacancies at other companies. The full-time job you leave to start your business will likely need to rehire for your position. The vendors that you buy from and the marketing agencies you partner with may need to expand their team to accommodate you and other clients like you.
Small businesses opening means more people are getting hired across the board, beyond just your company.
3. The money you earn stays in the community.
When a large chain like Starbucks, Walmart, or Uber Eats opens in a community, a portion of the profits leave the city (likely the state) and contribute to corporate earnings. While local residents certainly earn salaries by working for these companies, most of the money doesn’t stay in the area.
Consider Uber Eats, which typically takes a 30% fee on most restaurant orders. Part of that money goes toward paying the driver, but most of it goes to Uber’s shareholders.
However, if a local business hires a few drivers and sets up its own delivery policy, it can provide the same service to customers while keeping 100% of the profits locally.
The money earned by your small business goes back into the community. It is used to support local restaurants, builds up regional farmers, and gets donated to small nonprofits. Your dollar can stretch much further when it is spent locally because it’s compounded across partners, vendors, and employees.
4. You contribute to local taxes.
When your customers spend money at your business, as opposed to a large corporation, they are investing in their communities through income and sales tax. The taxes you pay will support local schools, help improve the roads, allow the city to create parks and other community areas, and fund social service programs.
By giving residents an option instead of Amazon or other e-commerce vendors, you can help your local government fund important improvements in your community.
5. You make your city a better place to live.
Local businesses are the lifeblood of communities. A dentist keeps teeth white and people smiling. A restaurant owner keeps residents happy and full. These small businesses aren’t just providing goods and services—they’re part of the ecosystem that is your town.
Small businesses are what make communities interesting. They are what attract people to live there. Your business, along with others in the area, will bring more residents to your town, attract tourists (and the money they spend on vacations), and encourage large-scale job creators to move in.
6. You help the environment.
Did you know that buying from a local business also means going green? Shipping items from foreign countries or across the US has a significant carbon footprint.
According to Mike Scott, a business and sustainability expert, “The shipping industry burns the world’s dirtiest fuel to move cargoes and passengers around the world [and] is one of the biggest contributors to climate change.”
If you can source items locally and customers can buy them from your small business, then you and your customers can both reduce your carbon footprints. You can cut down on emissions to make the environment healthier and the air cleaner.
Everyone benefits from local businesses in your area, from kids enjoying the fresh air in parks provided by tax dollars to your employees who rely on you for a paycheck. Keep these benefits in mind as you begin planning your small business. If you do decide to take the next step and launch a business, consider a small business loan to help you get up and running.
Collecting payments from clients can be surprisingly challenging. Every small business owner has experienced the frustration that comes from providing a valuable product or service and waiting days, weeks, or even months for payment.
The best invoicing software does more than reduce the work that goes into creating invoices and collecting payments. It also helps you get paid significantly faster, improving the timing of your small business’s cash flows.
Forget waiting for checks to arrive in the mail, taking them to the bank, and waiting again for the deposits to clear. With invoicing software, your clients can pay you almost instantly, and you can get your funds in days instead of weeks or months.
Invoicing Software Options
Below are some popular and new invoicing tools and software.
Manage your business finances with confidence using our simple, centralized dashboard. Create quotes and invoices and collect payments from the same application where you manage your business bank account, track your cash flow, and even apply for a business loan. The Lendio mobile app is free to all users.
Like many other invoicing software, SAGE offers a combination of invoicing and accounting tools for small businesses. The Pro Accounting software starts at $346 for the first year and includes access for a single user, invoice and bill tracking, expense management, automated bank reconciliation, inventory management, fraud management and reporting.
Freshbooks offers invoicing and bookkeeping software. You can try the software free with a 30-day trial. After that plans start at $8.50/month. On the lite plan, businesses can bill up to five clients, automate recurring invoices, send out estimates, send out unlimited invoices and accept credit card and ACH bank transfers. Plus and Premium plans include more robust accounting features.
Wave offers free accounting, invoicing and banking software. Instead of charging for the software the company charges a percentage for payment processing. It also offers optional payroll software and advisory services for an additional cost.
Benefits Of Invoicing Software
Invoicing software can be an invaluable tool for any small business. These are some of the most significant ways you can use them to your benefit.
Online Invoicing Options
In a world where convenience is increasingly in demand, online payment processing is no longer optional for many small businesses. If it’s at all possible for your business model, your clients will expect to be able to complete your invoices online.
If you can’t meet those demands, it’ll soon start to cost you business if it hasn’t already. Fortunately, invoice software is an affordable way to collect funds remotely. For example, the free plan lets you access our invoicing tool at no cost.
In addition, the convenience of the system isn’t just beneficial for your customers. It also means you’ll receive payment for your products or services more quickly, reduce the frequency of unpaid invoices, and improve your cash flow.
Streamlined invoice creation
It’s time to say goodbye to building invoices in a spreadsheet or document and emailing them to clients as a PDF. With invoicing software, you can effortlessly generate personalized and professional invoices in minutes.
Once you’ve created one with a structure that you like, you can save it as an invoice template and duplicate it for future transactions.
Not only will the software save you a significant amount of time and energy, but your clients will appreciate the increased quality of your documentation. Holding yourself to a higher standard of professionalism will only benefit your client relationships.
Automatic collections processes
Traditionally, the most frustrating part of invoicing is collecting from slow-to-pay clients after the due date has passed. You’ll inevitably run into those who have many other redeeming qualities but can’t seem to complete invoices on time.
That can have a significant negative impact on your business’s cash flow. If you find yourself going for weeks at a time without receiving payment for your products or services, it can cause a lot of financial strain and even push you into debt.
Fortunately, software can make the collections process the easiest part of invoicing. With it, you can schedule automatic follow-up emails that will go out to delinquent clients professionally and promptly without having to lift a finger.
Integrated Invoices And Bookkeeping
If your business sends invoices and purchases regularly, keeping your financial records in order can be surprisingly time-consuming. There’s a reason that full-time bookkeeping and accounting services exist.
When you use old-fashioned invoices, you create a lot of work for the individual in charge of revenue and expense tracking. They have to adjust the books for each transaction by hand, and there’s a lot of room for human error.
Once again, invoice software can help you automate the process, saving you or your accountant hours of work. Plus, when your invoicing feature integrates directly with your bookkeeping and accounting software, your Lendio account and records are always up to date.
How To Choose Invoicing Software
Invoicing is critical for most small businesses—it is likely the mechanism for how you get paid for the work you do. However, it can become tedious and frustrating for many of us who work with many different clients.
Why do you want invoicing software? For any small business using invoices, the overarching goal of an invoice is to get paid what you’re owed on time. Good invoicing software helps you accomplish this task—and more.
You should aim to create standardized, easy-to-understand invoices that can be made in minutes with a few keystrokes. Although it depends on your clients, ideally you don’t have to use different invoice templates for each entity you do business with. Invoicing software helps you homogenize and accelerate your invoicing operation.
1. Easy to Create Invoices
Probably the most critical function of any invoice software is the ability to create invoices, which you want to be able to do quickly, easily, and repeatedly. You want your invoice recipients to easily recognize how much they owe you, where they should send payment, and when you expect it—you want to give them no excuses for being late with a check. Most likely, you didn’t go into business to create invoices—solid invoicing software makes this part of the job a snap.
2. Branding Capabilities for Your Invoices
Along with making invoice creation breezy, look for invoicing software that easily allows you to add branding. Again, your big, bright logo sitting atop an invoice helps clear up any confusion on the part of the payee. Creating colorful invoices with your excellent branding also ensures you come across as highly professional and organized. Good invoice software can help you create documents in your brand voice for all of your clients. All you should have to do is switch out the type of work being invoiced and who you are sending the invoice to.
3. Ability to Create Recurring Invoices
Invoicing software eases the burden of being a small business owner by chasing down payments for you. You should be able to set up recurring invoices to your repeat clients so you don’t have to remind yourself to send something out every week or month. Even better, some options allow clients to set up automatic payments so you get your payments as smoothly as possible. If you work with clients on a long-term, repeated basis, invoicing software means you don’t have to constantly remember to send out invoices to them.
4. Multiple Payment Methods
Unfortunately, it can seem that clients will find any reason to delay payment. We’re often told that checks have been “lost in the mail” for weeks on end. Good invoicing software combats this issue by allowing your clients to pay you in multiple ways. Some can even allow you to receive payment by credit card or bank transfer, ensuring those funds enter your account as quickly as possible. Oftentimes, you can receive your money within 72 hours of your client paying the invoice through an automated clearing house (ACH) options.
5. Tie Invoices to Your Expenses So You Can Monitor Revenue
Invoices are only one element of your business equation. They represent your cash in-flows, and, in many cases, invoices might be the entirety of your revenue. On the other end of the equation are expenses like rent, wages, equipment, and office supplies. The best invoicing software links the two parts of your finances so you can see how your business is earning and spending money. For the long-term, this feature will give you a granular, data-driven ability to create accurate business planning documents, not to mention it helps take the sting out of tax time.
6. Identify Unpaid Invoices
If you have a long roster of clients, keeping up with your invoices is a job in itself. Determining who owes you what and when, along with who is delinquent, can be extremely frustrating and is likely not what you signed up for when you decided to go into business. Invoicing software can quickly identify which invoices are unpaid and how long they’ve been delinquent. It also easily sends invoice reminders on a recurring basis so you can let your payees know you are paying attention.
7. Change Your Pricing and Offer Deals
Depending on your business, you might find your pricing changes with the seasons, business traffic, or other factors. However, it would be nice to determine price changes for your business without doing line-by-line math in every one of your invoices. Good invoice software allows you to easily change up your pricing in case you want to offer a discount or need to increase costs due to a surge in demand. Even better, software can allow you to easily set prices by either dollar amounts or percentages.
Why A Professional-Looking Invoice Helps Your Business
Invoices are more than just a way to document transactions with your clients and collect payments from them. Just like your website, emails, and any other public or client-facing communications, they’re also a representation of your business.
As a result, investing in a small business invoicing software that can produce more professional-looking invoices may benefit you in similar ways, such as:
Professional reciprocity: Your relationships with your clients are just like those in your personal life. Consciously or not, they’ll take cues from how you treat them and treat you similarly. Setting a high standard for professionalism with your invoices will only encourage them to do the same with you.
Respect and credibility: Successfully closing a sale with a client means they think you’re the best option readily available. Anything you can do that builds further respect and credibility with them, including maintaining a professional image, will help you stay ahead of your competitors.
General goodwill: Using invoicing software to make professional invoices does more than just present an attractive payment page. It also makes completing your invoices a more convenient experience. Making things easier for your clients whenever possible is a great way for freelancers and business owners to promote recurring transactions.
These may all be intangibles, but they manifest themselves in a tangible way. Making your customizable invoices look more professional can directly increase your client’s timeliness in paying you and smooth out your cash flows.
Small businesses nationwide are struggling with the fallout from the coronavirus crisis. New research suggests that 50% of business owners have felt the effects, and nearly 40% report a decline in revenue. These negative trends were mainly chalked up to fewer customers visiting business locations, customers being more reluctant to make purchases, and customers having access to less disposable income.
Given the dire situation, the federal government is taking unprecedented action. The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) will allocate $2 trillion for relief initiatives. Included in the package will be a one-time payment to many Americans. Individuals making up to $75,000 a year will receive a $1,200 payment. Married couples making no more than $150,000 will get $2,400, as well as a $500 payment for each child in their family.
SBA disaster loans get a boost.
In addition to the personal payments from the relief package, there are multiple benefits for small businesses in the CARES Act. These include:
Paycheck Protection Program (PPP): Get up to $10 million to cover payroll support expenses such as employee salaries, paid sick leave, paid medical leave, insurance premiums, mortgage payments, rent payments, and utility payments.
Economic Injury and Disaster Loan (EIDL) and Loan Advance: These loans are specifically relevant in situations where your business didn’t suffer any physical damage but was harmed nonetheless. You can receive up to $2 million to cover expenses you would’ve been able to pay if the disaster hadn’t occurred. Because of the severity of the coronavirus pandemic, you can actually apply for an advance of up to $10,000.
SBA Debt Relief: With this program, the SBA pays the principal and interest on new SBA 7(a) loans that are funded before September 25, 2020. If you have an existing SBA 7(a) loan, the SBA would pay the principal and interest for 6 months. Note that this benefit is limited to SBA 7(a) loans and wouldn’t be applicable for PPP loans or EIDLs.
SBA Express Bridge Loan: With values up to $25,000, these loans require less paperwork and hit your bank account much faster than a typical SBA loan. This program is intended to deliver faster relief to those who need it.
Businesses can qualify for the expanded Small Business Administration (SBA) disaster loan program as long as they don’t employ more than 500 people. As with other SBA loans, this financing is not actually funded by the agency. Rather, the COVID-19 loans are facilitated by the SBA, and the money comes from banks and various independent lenders. The key element is that the SBA guarantees a portion of the loan, which lowers lenders’ risk and makes them more willing to work with those who have less-than-stellar credit history.
SBA small business loans are intended to help small business owners overcome the negative effects of the coronavirus pandemic, so if you’ve struggled to make payroll, cover accounts payable, handle fixed debts, or pay your bills, you could qualify.
Finally, the Families First Coronavirus Response Act could also help you during this challenging time. This federal action bolsters unemployment benefits and creates rules for emergency paid sick leave impacted by the pandemic.
The regular lineup of SBA disaster loans.
Multiple other SBA emergency loans for small businesses are available. While the details vary, they are all intended to help a business after physical or economic damage is caused by a declared disaster.
An SBA disaster loan can be used to repair or replace real estate, personal property, machinery and equipment, and inventory and business assets. But don’t go thinking that you could use one to expand your operations. The rules clearly state that it’s only intended to restore things to the way they were before the disaster.
Here’s a quick look at 3 different types of SBA disaster loans not directly related to federal action in response to the coronavirus crisis:
For those living in a declared disaster area and who have been victims of a disaster, there may be relief available through these loans. It’s worth noting that even though these loans are provided through the SBA, you don’t need to actually own a business to qualify.
If your business or organization is within a declared disaster area and sustained damage during that disaster, you can apply for one of these loans. Common examples include a hurricane or flood. These loans provide up to $2 million and are intended to help you replace or restore any damaged property.
This loan is specifically earmarked for business owners who employ a military reservist called to active duty. In these situations, the SBA funding can help your business with operating expenses.
Current declared disasters.
In order to qualify for SBA assistance for more regionalized physical disasters, you will need to live in a designated disaster area.
You can search for Presidential and SBA declared disaster areas by state and territory with the SBA’s online database. Recent examples include flooding in Tennessee and Mississippi, wildfires in Hawaii, and Hurricane Idalia.
Once a Presidential disaster is declared in your area, you need to first register with the Federal Emergency Management Agency (FEMA). To get started, call FEMA at 1-800-621-3362 or visit DisasterAssistance.gov.
After you’ve gotten a registration number from FEMA, you’re ready to complete your SBA online application. You’ll need to have the following information handy:
Contact information for all applicants
Social security numbers for all applicants
FEMA registration number
Deed or lease information
Insurance information
Financial information such as income, account balances, and monthly expenses
Employer Identification Number for business applicants
The SBA will review your application and then send an inspector to do an onsite review and to estimate the cost of your damage. The SBA makes these disaster loans a priority, so you can expect to hear back on their decision within a few weeks.
One thing to note is that the most commonly cited reason for delays in the process is an incomplete application. With this in mind, spend a little extra energy making sure every detail is correct before you click submit.
Also, don’t wait for any insurance settlements before you file your loan application. This common delay can cause borrowers to miss the filing deadline. If a settlement is made after you’ve applied, you can simply add the final insurance information at that time.
While every effort is made to ensure the accuracy of information when a story is published, the coronavirus pandemic and Paycheck Protection Program (PPP) have caused details to change at a rapid pace. Additional guidance from the government may change or clarify certain aspects of the forgiveness process and could result in changes to the information contained in these pages. For the most up-to-date information, please visit the COVID-19 section of our website. For more information, you can call us at (855) 853-6346. Lendio is not responsible for and provides no warranty as to the accuracy of this content. Lendio does not provide legal, accounting or tax advice. The information and services Lendio provides should not be deemed a substitute for the advice of such professionals who can better address your specific concern and situation.
When applying for business loans, credit cards, or other lines of credit, lenders put your credit scores in the spotlight. Credit scores tell lenders at a glance how responsible you are when it comes to borrowing money and paying bills. But just how important is that 3-digit number? Here's what you need to know about the highs—and lows—of credit scoring.
Credit Score Ranges Explained
Credit scores operate on a range, with a high end and a low end. The most popular credit scoring model for consumer scores is the FICO score. It's the one used by 90% of lenders for credit approval decisions. Note, these scores are different from business credit scores.
There are different FICO score variations, but the typical score range you're working with is 300 to 850. VantageScores, which are an alternative credit scoring model, work along the same lines. The current VantageScore version also ranges from 300 to 850.
What Is Good vs. Bad Credit?
Where you land on the credit score range depends largely on the information in your credit reports. FICO scores, for example, break down like this:
Payment history: 35% of score
Credit usage: 30% of score
Credit age: 15% of score
Credit mix: 10% of score
Inquiries for credit: 10% of score
VantageScores don't use that exact same formula, but they do factor in many of those same things. In terms of what your score translates to, a 300 would be the very worst score you could achieve on the FICO or VantageScore models; an 850 is considered a perfect score for either one.
That range leaves a lot of gray area in-between where you have different levels of credit. For example, here's how FICO breaks down its credit score ranges and grades:
800+: Exceptional credit
740 to 799: Very good credit
670 to 739: Good credit
580 to 669: Fair credit
<580: Poor credit
Understanding where your credit score measures up is important if you're planning to borrow money.
Why Credit Scores Matter When Seeking Financing
Credit scores matter for several reasons when you're applying for loans and other lines of credit. For example, say that you're using your personal credit score to apply for a business loan. Lenders will use your score to determine how likely you are to pay it back.
A FICO score in the excellent range virtually guarantees that you'll be approved, whether you have a perfect 850 credit score or not. In fact, lenders typically don't distinguish much between a score of 800 or 850. Either one sends a strong signal that you're a low-risk borrower, based on your past payment history and credit usage.
Having a credit score in the poor or fair credit range, on the other hand, could make it much more difficult to get approved for loans. You may be limited to certain borrowing options, such as a secured loan or line of credit. Generally, the lower your score, the riskier you appear in the eyes of banks and lenders.
Your credit score also counts when it comes to how much you pay for a loan. As a rule of thumb, the higher your credit score, the lower the interest rates you can qualify for. Getting a low rate is important, whether you're taking out a loan for your business or any other purpose because it means less money you have to pay back over time.
Is Aiming for a Perfect Score Worth It?
Reaching a perfect 850 credit is certainly an achievement, as very few people find themselves in this territory. But working toward a perfect credit score won't necessarily give you more of an edge when it comes to getting approved for loans or getting the best interest rates if you had an 800 score instead.
With that in mind, it's helpful to work on improving your score as much as possible, particularly if you plan to borrow money to fund your business. If your credit score isn't as high as you'd like it to be yet, here are some of the smartest things you can do to get it on the right track:
Pay your bills on time. Payment history accounts for the largest share of your personal credit score, so get in the habit of paying on time. Setting up automatic payments for your personal and business expenses can make this easier.
Reduce your debt. Carrying high balances on your credit cards can work against your score. Prioritize paying down some of what you owe, aiming to use 30% or less of your total credit limit.
Limit new inquiries for credit. Applying for new credit cards or loans can knock a few points off your score each time. Stick with applying for new credit only when it's absolutely necessary.
These seemingly simple measures can go a long way toward helping you boost your credit score.
Running a business can make anyone’s stress levels rise. In a Bank of America survey of 1,001 small-business owners, 41% of respondents said managing the business is by far the biggest cause of stress—more so than raising children (9%).
Money is often the leading cause of stress, and bad habits typically cause money problems for business owners. If you’re feeling stressed and overwhelmed with the financials of your business, consider these 7 habits that could be sabotaging your success.
1. Cutting costs without considering their impact.
You will find that many business owners make decisions that are “penny rich but cash poor,” meaning they save in the short run but lose money in the long run. In a Planet Money episode, one restaurant owner wanted to add an extra table to his crowded New York restaurant, thinking a new table would bring in more money. The reality was that he needed to take away a table because customers would then feel more comfortable and spend more—raising profits as a whole.
We often think that the best way to increase revenue is to add. Whether that’s adding a new line of products, additional services, or some other investment into the business, we believe that we can fix a money problem by adding more expenses and resources. However, many times we need to practice addition by subtraction.
Learning what to spend and what to cut takes time and an innate understanding of your customers and industry. Make sure your changes will help your employees and customers in the long run, not just your bank statement in the short run.
2. Keeping messy books—or no books at all.
A lot of people avoid going to the doctor for fear of what they might hear. This “don’t ask, don’t tell” mentality is also how many owners feel about their books when business is not going well. As businesses start to lose money, they tend to turn a blind eye to their finances.
They don’t want the stress of seeing their debts and focus instead on other aspects of the company. However, this practice is like throwing water on an oil fire because your books are one of the best resources for business owners to make better strategic decisions.
Clean and accurate bookkeeping can help you find waste in overscheduled employees, forgotten client invoices, or other ways to cut expenses and increase revenue. If you are in trouble, stay focused and keep your books in order.
3. Ignoring changes in the market.
You spent weeks and months honing your business model and developing a successful plan before launching. You might have even enjoyed many years of growth and profitability.
However, consumer demand and other market trends can lead to changes in your business, and if you’re not willing to adapt, you’ll struggle.
Perpetually broke business owners often focus on their company and strategies without investing enough time into external research and analysis. Even worse, these same owners will continue the course regardless of market or consumer changes.
Would you rather be wrong and profitable or stubborn and broke?
Successful business owners understand the importance of adaptability. They’re willing to make strategic changes based on feedback, financial trends, and other market factors that indicate a need for it.
4. Starting too many projects at once.
The other side of the pendulum from managers not keeping an eye on the market is the business owner who has a habit of chasing the “next big thing.”
These business owners will start projects before finishing others. They’ll spend time, money, and resources pursuing multiple avenues and projects without truly being able to invest the care and focus needed to do any well.
While chasing the next trend, they neglect the core competencies of their businesses and miss out on increasing profitability through more efficiency.
Consider how many new ideas and projects you and your team can handle. You will have more success with one carefully-researched and executed project than several half-baked ideas.
5. Micromanaging team members.
When times get tough, some business owners dig into the daily operations and start to micromanage staff. They believe that the best way to increase profitability is to keep a closer watch over their employees and the minutiae of their businesses. However, this is far from the truth.
Most businesses cannot operate with one person dictating everything. Micromanaging will often drive away your good employees, thus increasing turnover costs. It’s also unrealistic because you’ll create bottlenecks in your operations.
Rather than micromanaging, focus on big picture decisions that have a more significant impact on the success of your business and implement processes that empower and incentivize your employees.
6. Forgetting to train and grow employees.
A good manager doesn’t just avoid micromanaging—he or she actively works to train employees and make them more responsible and independent. Roughly 85% of employees say that job training is important to them. They believe it improves their job performance and gives them more self-confidence to make decisions.
Not only will training your employees make them more effective, but it will also keep them around. Employee turnover is a serious issue for many businesses. Employee turnover leads to more stress for your current staff, and it has a direct and profound effect on your bottom line. SHRM suggests that it can cost 6–9 months’ salary on average to replace a salaried employee.
If you’re neglecting training and employee growth opportunities, you should change that habit and begin investing in your staff.
7. Not taking time off.
We get it—running a business is an around-the-clock job. How can you take a break or vacation if you want to turn your business around? Well, you need to take breaks, not just for your sanity, but because it’ll actually make you more productive.
In fact, business owners should take more time off than most employees because of the increased stress that comes with running a business. Experts recommend taking at least a week each quarter (4 weeks of vacation per year) to relax, reboot, and regain your strength to push on when you get back.
Find a balance.
The vast majority of the bad habits on this list have to do with a lack of balance or moderation. Closely managing employees is a good thing until it becomes micromanagement. Adjusting to change is a smart business practice until you take on too many projects at once. By balancing your goals and ambition with realistic expectations and healthy choices, you can avoid becoming a perpetually broke business owner.
Nearly 50% of all American veterans decided to ditch the corporate career route after World War II and forge their own entrepreneurial paths. With their training, discipline, and willingness to sacrifice, these military members made fantastic small business owners. But since the Korean War, the percentage of military veterans starting businesses has dwindled.
Why? Because starting a business wasn't easy, and the US economy made it nearly impossible for veterans to get access to the financing and resources they needed. That's far from the case today.
The government noticed the issue and did something about it (if only they'd do the same thing about the DMV). By introducing veteran-specific educational programs, financing opportunities, and set-aside contracts, the US government has finally given military members an even playing field.
One business-changing advantage the government has given veterans is the Vets First Verification Program. Qualifying for this program could change the way you do business forever. If you're a veteran small business owner, don't do business another day without learning the ins and outs of this program—it's a game-changer for anyone who is targeting government contracts.
What is the Vets First Verification Program?
The Vets First Verification Program is a government program that allows your business to bid on federal set-aside contracts and get exclusive access to resources and support. To do any business with the US Department of Veteran Affairs (VA), you'll need to register your business with the Office of Small & Disadvantaged Business Utilization (OSDBU), which isn't as easy as it should be. More on that later.
Government contracting can open up millions of dollars of new opportunities for your business—that's why securing a contract is so tricky. Fortunately for you, The Veterans Entrepreneurship and Small Business Development Act of 1999 guarantees up to 3% of quality federal government contracts and subcontracts will be set aside for veteran-owned small businesses (VOSB) and service-disability veteran-owned small businesses (SDVOSB). That 3% might not seem like a lot, but since the government spent $550 billion on contracts in 2018, rest assured—there's a whole lot of business to be had.
Advantages of being a veteran-owned small business.
While qualifying and registering your VOSB can be a pain in the you-know-what, it's definitely worth it. Here is a taste of the benefits and advantages you can expect:
Ability to work with the VA: The VA only works with VOSBs and SDVOSBs, so you'll be part of a smaller pool for any work they have to offer.
Set-aside government contracts: Be first in line to win federal contracts reserved just for military veterans. These contracts could make up the entirety of your entire business.
Educational resources: The VA offers training on everything from building a successful business plan to strategies to win government work.
Mentorship and networking: You'll be connected to individuals who have the know-how to guide you in the right direction. The VA will also help you build relationships and connections with large private-sector firms and those in charge of government procurement.
Special financing terms: The SBA offers small business loans to the general population, but they provide lower rates, better terms, and financial support to VOSBs.
How to register your business as a VOSB.
Before you try and register your business as a VOSB, make sure you meet all the VA's qualifications:
Be considered a veteran, meaning (a) you've served on active duty in the military and have not been dishonorably discharged or (b) served as a Reservist and were called to federal active duty or were injured in the line of duty.
Own at least 51% of the company you register and be in charge of the day-to-day operations and management.
Have the necessary experience to make business decisions.
Must be the highest-paid person at the company.
Work full-time for the business you're registering.
Hold the highest position at the business.
If all of these conditions are true, then you qualify to register your business as a VOSB.
Next, you'll need to apply online through the Vets First Verification Program. The application will walk you through all of the necessary steps.
If you have questions about your eligibility or how you can ensure your application will be accepted, the Center for Verification and Evaluation (CVE) hosts free webinars to answer all of your questions. You can also find a local Verification Assistance Counselor to give you one-on-one support by using the VA's state-organized list.
Get registered—it's worth the hassle.
Even if you don't want access to set-aside government contracts or educational resources, it's still a good idea to register your business as veteran-owned. Studies show that 70% of Americans prefer to do business with a VOSB than a non-veteran-owned one. This is a free, fantastic opportunity you can't pass up!
The process can be a hassle, but it's worth it in the end. Don't wait to get the help you need—these exclusive resources are invaluable, especially for new business owners. Thank you for your service—we wish you the best of luck in this next important stage of your career.
As a small business owner or someone who is self-employed, tracking your business-related expenses and understanding what you can and can't deduct while doing your taxes is critical. Not only can it maximize your small business deductions and save you lots of money, but it can also help you reduce your risk of being audited.
Some of the most common business-related expenses are travel costs. Whether you drive to meetings often or fly out for conferences and stay in hotels, understanding what is and isn't considered a travel expense is an important aspect of small business accounting.
What Is a Travel Expense?
Travel expenses are costs that occur while you're traveling away from home for business. If you're on vacation with your family, your margaritas don't count as travel expenses. However, if you're traveling for a work-related conference, everything from your airfare or mileage to your hotel and food can count as business-related travel expenses. Personal expenses, such as a new pair of shoes, don't count, even if you're traveling when you make the purchase.
However, not all business-related travel expenses are deductible. According to the IRS, you can't deduct anything extravagant or unnecessary, so don't try ordering a private limo service to pick you up from the airport and writing it off. You also have to be traveling away from the general area considered your "tax home" for at least 1 workday to deduct your costs as travel expenses.
Different Types of Travel Expenses
There are several different kinds of travel expenses. Understanding what they are will help you identify what is and isn't considered a travel expense.
Transportation
If you're on a work trip, any transportation services you use to get to and from work events can count as travel expenses. This category may include shuttles, buses, trains, taxis, and car rides. Generally, deductible trips include transportation from the airport to your hotel and back, as well as transportation between any work-related events or clients and your hotel.
Additionally, if you use your car to get around on a business trip, you can claim mileage on your taxes and deduct it at the standard mileage rate. According to the IRS, the mileage rate for 2020 is 57.5 cents per mile that you drive for business-related usage.
Airfare
Airfare is also included as a travel expense if you choose to fly to your destination for a work-related trip. However, if you pay for your flight with frequent flyer miles or other rewards points or if a client provides your ticket, you're not able to write off airfare as a travel expense.
Accommodations and Lodging
If you need to pay for overnight accommodations on a work trip, whether that's a hotel or other type of lodging, it counts as a travel expense. Of course, your lodging costs have to be within reason, so don't expect to be able to deduct a 5-star resort.
Food
You can generally deduct 50% of the meals you consume while traveling away from your tax home for work, as long as they're for non-entertainment purposes. While there's no specified distance you must be from your house in order to deduct meals as a travel expense, the IRS does state that you can take the deduction when you're away from home for longer than an ordinary workday and it's necessary to stop somewhere to sleep. Multi-day trips are clearly applicable, but if you're on a half-day trip to the next town over, it probably doesn't count.
Miscellaneous Travel Expenses
While transportation, airfare, lodging, and food are the most common travel expenses, they're far from the only ones. Travel expenses can also include the following:
Shipping and handling costs for luggage or work-related materials to and from your destination
Laundry
Business-related communication (business calls or faxing, for example)
Tips paid for work-related expenses
Other necessary costs related to business travel
What Isn't Considered a Travel Expense?
In addition to these deductible travel expenses, a number of common travel expenses aren't deductible.
You can't deduct any travel expenses that aren't business-related, which includes personal expenses completed while traveling for business. You also can't deduct travel expenses that are superfluous or excessive, such as luxury purchases. If your family travels with you on a work trip, their expenses don't count as your travel expenses.
When you have business-related expenses in your home city, they may or may be deductible. However, they aren't considered travel expenses.
Knowing what counts as a travel expense will help you understand what you can and can't deduct when doing your taxes. Pair that knowledge with common small business tax credits, and common small business tax mistakes, and you'll be able to maximize your refund and avoid being audited.
Social media can be a game-changer for small businesses—if you know how to use it. This guide covers everything from choosing the right platforms to creating engaging content and growing your audience. With actionable tips and proven strategies, you’ll learn how to turn likes and follows into real business results.
Email marketing is one of the most powerful tools for small businesses—when done right. This guide covers everything from building your email list to crafting engaging campaigns that drive results. With actionable tips and step-by-step guidance, you’ll learn how to connect with your audience, boost sales, and grow your business through email.
Digital marketing doesn’t have to be overwhelming. This guide simplifies the essentials, from building an online presence to leveraging social media, email, and SEO. Packed with practical tips and step-by-step strategies, it’s designed to help small businesses succeed in the digital world without a big budget or a full marketing team.
Let’s face it. There’s a lot of bad marketing advice out there. Or great advice that’s far too in-depth for a small business owner who isn’t looking to start a full-time career in marketing. We created this guide to cut through the clutter and provide you with principles, direction and the applicable step-by-step how-tos to get the job done.
Your brand is more than just a logo—it’s the heart of your business. This guide walks you through the essentials of small business branding, from defining your identity and crafting your message to building a strong, lasting impression. With clear steps and actionable advice, you’ll create a brand that resonates with customers and sets your business apart.
Hiring for small businesses doesn’t have to be complicated. Your business can achieve success when you understand relevant legal requirements and find the right job candidates for your open positions. This comprehensive guide covers everything from finding the right employees to hire to employee training and development.
Your best customers are your biggest growth opportunity. This guide breaks down customer marketing strategies tailored for small businesses, helping you turn happy customers into loyal advocates. From building relationships to leveraging referrals, discover actionable steps to maximize lifetime value and drive sustainable growth.
From selecting the right franchise opportunity to navigating the financial aspects, this step-by-step resource equips aspiring entrepreneurs with the knowledge and strategies needed to thrive in the world of franchising.
Have a business idea but not sure where to start? Our comprehensive guide to starting a business has everything you need to know. From legal requirements to market research, we’ve got you covered.
Running and growing a business is no easy feat. Our guide to running a business has everything you need to know to keep things running smoothly. From managing employees to marketing your business, we’ve got you covered.
Take your business to the next level with our Accounting Guide. Master the language of numbers, understand financial statements, and make informed decisions based on accurate financial data. Discover the power of sound financial management.
Master the art of cash flow management with our comprehensive guide. Learn strategies to optimize your cash flow, forecast revenue and expenses, and keep your business financially stable. Take control of your finances and achieve long-term success.
Streamline your billing process with our Invoicing Guide. Learn how to create professional invoices, manage client payments, and maintain a healthy cash flow for your business. Get paid faster and efficiently track your revenue.
A great marketing strategy is the foundation of small business success. This guide takes you step-by-step through defining your goals, identifying your audience, and choosing the right channels. With practical tips and clear direction, you’ll build a tailored strategy that drives growth and delivers measurable results.
Navigate the complex world of taxes with our Tax Preparation Guide. From understanding tax obligations to maximizing deductions and filing quarterly taxes, we’ll help you stay compliant and minimize your tax burden. Unlock the secrets of tax success for your business.
Stay on top of your business finances with our Bookkeeping Guide. Learn the art of tracking income and expenses, maintaining financial records, and keeping your books in order. Unlock financial success with our expert tips.
Need help securing funding for your business? Our business loans guide simplifies the financing process, explains key terms, and walks you through your loan options.
