“The number one thing any budding entrepreneur needs to remember is to almost fully discount other people’s opinions about what you are doing. That’s because most people are not going to understand what you’re up to.”

There is an old song that says “the first days are the hardest days, don’t you worry anymore.” That is particularly true for early-stage entrepreneurs, confronted with a long list of obstacles and challenges that would make most people wilt into submission.

But there is a special fire that guides the entrepreneurial crowd, defined by personalities who want to stand out, innovate and challenge themselves to push the limits of self-actualization. So when it comes time for those early-stage entrepreneurs to battle adversity, it is important to remember some very key tips that will help you stay the course and navigate uncertainty.

Here are 6 tips that every early-stage entrepreneur should remember when bucking the trend and chasing your dreams.

Top 6 Tips for Early-Stage Entrepreneurs

Don’t Listen to Other People

The number one thing any budding entrepreneur needs to remember is to almost fully discount other people’s opinions about what you are doing. That’s because most people are not going to understand what you’re up to. In fact, you might even find some people making fun of what you are doing and talking about how ridiculous it is. If that’s the case, take it as a compliment and form of encouragement. Because remember, good ideas provoke strong reactions from people, so if you find that others don’t “get” what you’re doing or even find it silly, you could really be on to something.

Work with Conviction

People who love what they do pursuit it with a blinding passion, and that really goes for anything in life, not just what we typically refer to as “work.” Take some of the greatest guitar players in the world. These people play for years and years simply for the pleasure of the experience. But somewhere down the line, all that practice has a serious impact on skills and results, pushing the ones who really love it into outlier territory. In order to become successful at anything you have to pursuit it simply for the joy of the experience.

Very few people who set out to get rich get rich. The people who get rich are the ones who just do something they really like doing, and through the evolution of practice and repetition, become very good at it.

Create Strategic Partnerships

This can be totally critical for the success of a new business or idea. It’s not always easy going out and bagging individual clients or sales, so having an established partner with a large following is an amazing way to expose your business to a large audience of potential customers. It also gets you a strategic relationship with a company that has already beaten the odds, putting another ally in your corner for support and strategic consultations.

Don’t Worry about Profits

This might seem insane at first blush, but early profitability is really no indication of long-term success or failure. Just take a look at what we see happening in technology all the time. Some of the greatest tech companies in the world struggles to produce a profit for years before turning the corner and scaling into the green. That list includes mega giants like Amazon, Yahoo and even Facebook. So early on, don’t focus too much attention of turning a profit, it’s more important to set the foundation for even getter results further down the line.

Don’t Risk Everything

Most start ups involve some kind of seed capital. That could be anywhere from a few hundred bucks to buy a web domain and start a blog or a few hundred thousand to become a local Taco Bell franchisee. But either way, you don’t want to risk so much on your new venture that you will be forced to check into the local homeless shelter if it doesn’t work out as planned.

Life Goes On

But even if your business doesn’t become a financial success, that doesn’t mean it’s a total failure. There are incredibly valuable lessons to be learned from every kind of experience in life, both good and bad. And the fact of the matter is that most successful entrepreneurs have a number of “failed” businesses before they actually hit it big. So on that level, it sounds like financial success is more a matter of gaining experience and keeping at it then finding a magical new product or service.

The Take Away

Taking the plunge into an entrepreneurial track can be both exhilarating and terrifying at the same time. But staying focused on some core values and lessons can help make that trip a little less scary and improve your chances of hitting your financial goals.

MONEY MATTERS is a weekly column on the Retail Minded Blog that is contributed by Michael Vodicka, founder of boutique financial consulting firm the Vodicka Group. MONEY MATTERS is Retail Minded’s way of supporting independent store owners with all their financial concerns, real life needs and everyday issues both in and out of their  stores. You can find MONEY MATTERS every Wednesday on RetailMinded.com as well as in each issue of Retail Minded Magazine. 

**Follow Michael on Twitter @mikevodicka

Think back to a time you walked into a store and were greeted with a friendly smile and an assertive yet not too pushy associate who took the time to engage you in the store product. Now recall an experience when you walked into a store and were not greeted with even a hello and left without being acknowledged at all. Both actions delivered by store employees influenced you in your shopping experience, however only one of these scenarios likely resulted in an unplanned purchase or at least an enjoyable shopping experience.

The goal of your store employees should be to demonstrate knowledge and interest in the product or service they are selling while also communicating in a professional manner. The key here is to remember that your employees are a direct reflection of your store and often, they are what consumers remember more so than the product. This said, in addition to their knowledge and interest of your store product or services, also consider their personality and style. Do they complement your store, as well? They should.

Having the experience or at least the interest in the products being sold is essential. But this will not equal the right sales approach in all employees. Make sure that your employees are aware and well trained in communicating to customers the way in which you want them to. All new hires should be trained accordingly, as well as reviews / trainings / store meetings should take place on a quarterly or bi-annual basis. Without communicating your expectations of sales to your team, you cannot ensure the best customer service from your associates.

Finally, while it can be tempting to hire friends, family, or just someone who you get along with, make sure their passion towards your store purpose is on track with your own. This will reflect in their sales performance and customer service and ultimately, in your store sales.

“Higher total credit available sends a message to potential lenders that other financial institutions have modeled you as a good credit risk and boosted your borrowing capacities.”

Last week we went over some tips small-business owners can use to increase their chance of getting a loan. Here is a link to the original story for anyone who wants a quick refresher; Increase Your Chances of Getting a Loan.  One of the first items discussed in the article was the importance of a strong credit score in securing a loan.

But because this is such a universally important issue, for both small-business and personal borrowing, I thought it made sense to circle back around and take a closer look at some steps you can take to boost your credit profile.

So on that note, let’s go ahead and take a look at our Top 5 Tips to boost your credit score, probably the single most important factor affecting a person’s ability to secure either a personal or business loan.

5 Tips to Boost Your Credit

Close Unused Accounts

With credit card offers being thrown in our faces from every direction, it’s actually pretty easy to accumulate a totally unnecessary number of accounts. On any given day, it’s not uncommon to receive multiple credit offers through the mail. It also happens when we shop, where the retailers are quick to extend lines of credit to their customers in order to get them spending. Between Best Buy, Target, Macy’s and a few others, it’s not uncommon for people to have in excess of 10 credit cards.

But the reality is that this is doing more harm than good, not only tempting you to spend but also flagging you as a credit risk. The bottom line here is that reducing the number of credit cards you have open will increase your credit. So figure out which ones you simply can’t live without and just go ahead and close the rest.

Increase Credit Limit

This might seem to fly in the face of our first point, but limiting your credit to a few accounts and then having those limits boosted is a great way to increase your credit score. That’s because the higher total credit available sends a message to potential lenders that other financial institutions have modeled you as a good credit risk and boosted your borrowing capacities. Having 70K in totally borrowing capacity is better than having 50K.

Decrease Utilization

But just because you have your credit limit jacked up doesn’t mean you should go on a spending bender, it’s actually quite the opposite. Once the credit spigots are opened, you want to exercise restraint and keep those balances as low as possible. That is referred to as utilization rate on the Street and it is an important factor when banks are deciding how much more debt your financial profile can handle.

Dispute Discrepancies

It is not uncommon for people to get access to a credit report and see some long-forgotten liability from many years ago still hanging around. That could be an old utility bill from college or even an unpaid parking ticket. And a lot of times, the debt has been settled and the collection company has simple forgotten to report it as such. So get a hold of your credit report and look for any suspicious items that have either been settled or can be done so easily.

Pay on Time

This one might seem a little more obvious but it is none the less quite important, and that is paying your bills on time. This basically boils down to your record, demonstrating to potential lenders that you can effectively manage various financial liabilities regardless of how busy life gets. And that is frequently. But don’t let that stop you from sending out your monthly payments on time, which has never been easier with electronic bill pay and financial transactions.

The Big Picture

A credit score is probably the single most important factor affecting your ability to secure a loan or line of credit. And by taking just a quick look at your profile and identifying key areas or weaknesses, you can do a lot to boost your score and increase your chances of getting that extra line of credit to help keep you and your small business growing.

MONEY MATTERS is a weekly column on the Retail Minded Blog that is contributed by Michael Vodicka, founder of boutique financial consulting firm the Vodicka Group. MONEY MATTERS is Retail Minded’s way of supporting independent store owners with all their financial concerns, real life needs and everyday issues both in and out of their  stores. You can find MONEY MATTERS every Wednesday on RetailMinded.com as well as in each issue of Retail Minded Magazine. 

**Follow Michael on Twitter @mikevodicka

Among the many challenges of a store owner is finding consistency in your overall store communication. While it’s easy to use tags, labels, marketing and other collateral provided by vendors, it’s also important to create your own branding here. For example, when pricing your products, consider using your own labels to help establish a strong brand for yourself. Collectively, your logo and visual image at large help shape your store brand and reputation. Each component of this should work together to establish a strong, cohesive message.

Beyond labels and branding, consider the colors you are using in your stoer. Do they make sense? Do they blend with your logo and total store image? From wall colors to store signage to business cards, how does your store look when overlapped together? Your design choices impact your customer experience, plain and simple. Don’t let anything be an afterthought and if it was, take the time to fix it. Sure, this may sound easier said then done. But work towards this in an effort to create a powerful store experience for your customer.

Possibly some of your store challenges lie in the assortment of displays and  fixtures throughout your store. Mismatched hangers never look good, and sloppy merchandising is a quick fix with the right supplies. Specialty Store Services offers everything you need to polish your visual appeal, allowing your products to stand out.

As an indie store owner, we know budget is an issue. And that’s okay. We get it. Luckily, many of the visual impacts you can make are free or affordable.Wall paint, cleaner merchandising, less clutter and cohesive design. If you don’t trust yourself to make all these decisions, don’t be afraid to ask questions or advice from others. Friends, other business owners or even paid experts. The idea is to be aware this is necessary though and make your own efforts to make it work for you.

Have your own quick visual tips? Let us know! Please comment below.

Retail Minded wants to support all your visual merchandising needs! Our recently launched Visual Merchandising Workshop is a downloadable presentation that teaches the vast dynamics of visual merchandising specific to independent, retail businesses. Our Visual Merchandising Workshop makes the perfect presentation for indie stores, Chambers, Mainstreets, business organizations and more to learn from and gain leading advice specific to visual merchandising. It’s packed tight with applicable tools, valuable examples and a step-by-step presentation that makes presenting this workshop as easy as 1-2-3… even if you know nothing about visual merchandising! Affordable and convenient, this is the perfect solution for individual store owners and business groups to gain quality insight on merchandising tips for their stores.  Click here for a preview. Purchase here! 

“Securing a business loan can be a very powerful catalyst for growth. So be sure to do your homework and know the rules of the game in order to increase your chances of success.”

Taking out a loan is a very important step for growth for many small-business owners. That extra funding and liquidity can go a long way for opening new locations, adding labor resources or creating a strategic partnership that will help pump up your brand.

So when the time comes for you to walk through the doors of your local lender and ask for an infusion of cash, it’s important that you have a very clear understanding of how the game is played. Because just like the small-business owner, banks are in the business of making money, and in light of the financial implosion a few years back, they are very picky about whom they lend to and who they don’t.

On that note, let’s do a quick run through of some very key points that you should consider in order to increase the chances you and your small business will get the funding you need to keep growing.

Top 6 Loan Tips

Tweak Your Credit

This category actually deserves its own column (maybe next week), but first and foremost, your bank will be looking very closely at your credit in order to determine if you are a qualified borrower. There are a number of strategies you can use to give your credit score a quick shot of adrenaline, but  generally speaking, you want to make sure there are no glaring weaknesses. Like a cable bill from 10 years ago or a parking ticket from 5 that you simply forgot about. It’s easy to forget about some of these lingering issues in our fast-paced world, so make sure to get a copy of your credit report, hunt down any open issues and get them taken care of quickly.

Collateral

It also really helps to have assets when you are looking for a loan, which actually reminds me of the old saying, “the only people who qualify for loans are the ones who don’t need them.” While that’s actually not true, the moral here stands; if you want to borrow money, it always helps to have some sort of collateral to pledge against your borrowings. That could be a house, specialty investments, stocks, bonds or even equity in your existing business. People who have valuable assets are demonstrating to the bank that they know how to earn and save.

Know Your Banker

Speaking of banks, your personal banker will play a very key role in determining if you qualify for a loan. So that means it pays to develop that relationship as much as possible and do everything you can to get another ally on your team. That could be going out for lunch, following up with an insightful email or just being as charismatic as possible when you walk through the door.

Get a Cosigner

This is almost a sure fire way to qualify for a loan if you can secure a credit-worthy individual as your co signer. It’s also another way to quietly introduce another partner or stake holder into your business, where you can induce someone to back your business loan with a equity or some kind of kick back.

Know Your Business

When you apply for your loan, expect to be grilled about your business. What were sales last year? Average sales over the last five years? How profitable are you? How does the balance sheet look? What about margins? Is your growth organic or debt fueled? Bankers can’t see or feel your business, so all they have to go on is what they see on paper. So make sure you understand the parameters that a banker uses to evaluate the strength of a business.

Work Multiple Deals and Network

This reminds me of the saying “if at first you don’t succeed, try, try again.” If for some reason you get dinged on your first application, do not fret. Keep in mind, there are thousands and banks and bankers all across the world as potential lenders. So be sure to cast a wide net and talk to a number of different financial institutions to determine who the best fit is for you and your small business.

The Big Picture

Taking out a business loan can be a very powerful catalyst for growth. So be sure to do your homework and know the rules of the game in order to increase your chances of success.

Author

MONEY MATTERS is a weekly column on the Retail Minded Blog that is contributed by Michael Vodicka, founder of boutique financial consulting firm the Vodicka Group. MONEY MATTERS is Retail Minded’s way of supporting independent store owners with all their financial concerns, real life needs and everyday issues both in and out of their  stores. You can find MONEY MATTERS every Wednesday on RetailMinded.com as well as in each issue of Retail Minded Magazine. 

**Follow Michael on Twitter @mikevodicka

A typical trunk show is when the designer or vendor brings their line to a boutique for a special in-shop showing (items used to be carried in a trunk, thus the name).  Generally, but not always, accessories vendors bring stock pieces they can sell during the event while clothing vendors bring samples, take orders, and ship the items later (usually 4 – 8 weeks out).  A show can be from 2 hours long to all afternoon, depending on the boutique, the designer, their wants and needs, and their relationship.  My suggestion for designers starting with a new store is 2 – 3 hours.  You can always stay if things are rockin’ but if it’s slow and you committed to a full day, trust me, that is one loooooooong  day.
 
The shop will pay you the wholesale price for each piece they sell.  It is the shop owner’s decision what retail price the consumer is charged.

And now for the tips…

Tip #1:  You and the Retailer should work as partners.

You and the store are in this together and you want to make it win-win situation.  Try to avoid an “us against them” attitude. Do everything you can to insure the shop has a good experience with you.  A few more points:

Designers win: 

• Your line is featured in front of a whole new clientele (that you didn’t have to find on your own).
• You get a chance to interact with the end-user of your product; this gives you an opportunity to see your things on many different people and hear their feedback (so valuable!)  It makes you a better designer, trust me.
• It gives you a chance to actively SELL your line and explain why and how you designed it.  This can be quite a rush for designers and you get to see what customers really like about your product – it feeds the ego.
• You get instant credibility by being associated with a good store.  When buyers and customers see you sell at such-and such, it makes you more interesting to them.

Stores win:

• Trunk shows are a low risk way to test your product.  Stores don’t pay you for merchandise unless it is a guaranteed sale and they do not tie up their dollars with inventory. They love this!
• It gives the shop an automatic, low-cost special event and creates a buzz with their customers.
• Retailers can offer a much bigger selection and more options for their customers than on a regular day.

Tip #2:  Promote the heck out of it.

Act like a true partner and be pro-active about maximizing you sales during the trunk show – and not relying on the store to do it.  The old days of showing up with your line on the appointed day and waiting for customers to walk in the door are OVER.  You must do more, including:

•   Create signage for the shop window advertising the event and be in charge of installation etc.  Show the shop a sample of what you will do before they make their decision and agree to tailor the signage to their particular taste and storefront.
•  Create a nice postcard or marketing piece to be handed out before the event to the store’s customers.
• Create an email invitation to the event that will go to your current contacts and the store’s list.  In addition to this, send 2 reminders before the event.
• Offer an incentive just for the show.  It doesn’t have to be a discount on your line. It could be a gift with purchase, free shipping, a chance to win a seriously good prize (no, a $50 gift card for your line is not that exciting – a $1000 shopping spree gets attention.)
• Do your homework. Take an afternoon (or 2) before the show and hump it to the other businesses around the area.  Say hi, be friendly, hand out your cards/photos/whatever you have, and ask them nicely to send their customers over. Consider giving them a good reason to send people your way – a $10 gift card to Starbucks for every customer they send?  A % off for their customers or themselves?  I know seems like a lot of work, and it IS, but it pays off.

Tip #3: Follow through and deliver what you promised. 

This is not always the fun part.  It’s a blast to take orders…not as much fun to produce and ship them.  This is the stuff that will make or break your business, however.  If you’re reliable and efficient, your business will prosper – and word gets around..

I’ve seen dozens of designers – hundreds, really – lose momentum because they ship late or not at all, forget to contact who they said they would, and just show a general lack of discipline and dedication.  During the trunk show, try to keep in mind a healthy dose of reality and don’t over-commit yourself or promise things you can’t do.

So now it’s your turn, what’s worked for you? Would you leave a comment below and share tip #4? We’d love to hear it!

Contributor Jane Hamill teaches apparel and accessories designers how to start and grow a profitable business – even if they flunked math and hate selling.  She is the creator of online courses such as “How to Sell Your Line to Boutiques and “How to Start a Fashion Business” and she also coaches entrepreneurs one-on-one. Find her at www.fashionbrainacademy.com.

This time around it was the best first quarter in 14 years for the S&P 500, with stocks cranking out huge gains in just 12 weeks after returning exactly 0% in all of 2011. That went a very long way to support consumer confidence and spending, both hitting multi-year highs along the way.

But the market has cooled since then, pulling back sharply in April on yet another flare up in the Euro zone. So is the recent bout of volatility spooking consumers?

Consumers Still Feeling Good

According to the conference board, not at all, with its April read on consumer confidence coming in ahead of expectations and holding near a 4-year high. Other consumer indices are singing the same song. The Bloomberg Consumer Comfort Index from mid April matched its highest level in four years, while the Thomson Reuters/UMichigan Consumer Index showed only marginal deterioration from last year.

So for the time being, in spite of some short-term weakness in the stock market, the consumer mood appears to be fairly upbeat. That’s great news for the small-business owners of the world and big companies alike, where bellwethers Microsoft Corp (MSFT) and General Electric (GE) both just reported excellent first-quarter results.

Obstacles Ahead

But moving forward, just as we discussed last time, a number of challenges remain. Like housing. The S&P/Cash Schiller Housing Index just showed home prices hitting a new 10-year low. Home prices have a huge impact on consumer spending, so every time another negative headline hits the Street it weighs on sentiment.

Employment trends will also be a factor. One of the big surprises of 2012 has been the strongest jobs growth since the financial implosion of 2008, going a very long way to support consumption. But the April jobs report fell to its slowest growth in 5 months, so if that trend continues to cool into summer, a seasonally weak time for employment anyway, it won’t do much to lift the mood.

Energy costs will also be a hot topic, with gasoline topping $4 a gallon in certain parts of the country. That’s a bad sign heading into summer, a time of peak gasoline consumption as people take to the road for vacations and family parties. And if we see more political volatility in the Middle East, it’s anyone’s guess where prices are headed.

So in  spite of the great start to the year for the economy, jobs and consumer spending, as always, it feels like there are many warnings signals. For the time being, neither the economy nor consumers are showing many signs of weakness. But like we’ve seen so many times over the last few years, that can change quickly, so it always makes to be prepared and stay nimble.

Auth

MONEY MATTERS is a weekly column on the Retail Minded Blog that is contributed by Michael Vodicka, founder of boutique financial consulting firm the Vodicka Group. MONEY MATTERS is Retail Minded’s way of supporting independent store owners with all their financial concerns, real life needs and everyday issues both in and out of their  stores. You can find MONEY MATTERS every Wednesday on RetailMinded.com as well as in each issue of Retail Minded Magazine. 

**Follow Michael on Twitter @mikevodicka

In no particular order, here’s what has made our list.

1. Store Overhead. Let’s face it, rent isn’t cheap (for most of us) and inventory costs a lot. But both are necesseities for most retail busineses. This can create pressure for indie retailers since along with these expenses, they have many others. Are best advice? Determine your best Retail Turn rate to support your store space, inventory and ultimately, your bills. Issue 2 of Retail Minded Magazine has a fantastic article on this, and we encourage you to find your own best turn to help you manage your overhead.

2. Personal Expenses. Life isn’t free, plain and simply. Covering the expenses of your store is one thing. But feeding yourself – not to mention a family – and keeping a roof over your head is another. And as far as we are concerned, we want you to have a roof you enjoy! So what’s a retailer to do? For starters, get your store in shape. Don’t skip any steps in helping it succeed in the marketplace. And if possible, factor in a target salary for yourself so that you can budget your personal life accordingly. Then work extra hard to earn it and even earn more! Promise – we know many retailers who do this and do it well.

3. Health Insurance. And time off to actually go to a doctor! Retailers don’t have idealistic hours. You work a lot! But finding a health plan is important – and dare we say vital – in your work / life balance. Many Chambers offer health care as a benefit to their Chamber members. Other associations and organizations also offer this. So if you think you have to be alone in getting health care, you don’t have to be. While that is one option – you have many to consider.

4. Work/Life Balance. The idea of spending all day, everyday in your store can often seem exciting. Fast forward a few years – or even months – and there gets to a be a point for almost every retailer we know that they wish things were not so strict when it came to store hours, face time in store, etc. Here’s the catch – it’s strict for a reason and it’s simply part of retail. You should do everything you can to avoid closing your store early or at random times during the day – unless it’s a quick 15 minutes or so to grab lunch, walk your dog or run a fast errand. We get that. Otherwise, strive to find support to give you the balance you need in being away from your store. This may mean hired help. Maybe a friend can help you. Whatever it is, don’t let yourself get burnt out. That’s where things go downhill.

5. Logisitcs. A license for this. A license for that. Who knew in retail you would have to gain permission to put a sign outside your door? While each retailer and each commuity is different, for the most part everyone has been surprised by all the logistics involved in getting doors opened and more importantly, stayed open. Whether it’s serving wine at a party you have or putting a new overhang sign on your door, there are hurdles to consider – legally. We’re not even talking about the licenses you need simply to resale as a retailer. Our suggestion? Don’t take shortcuts here. The steps may seem long and mundane, but they are a must.  Plus, fines add up. And from our notes, fines are distributed way too often!

While it’s impossible to give everyone a master plan to easily navigate your unique store and your unique steps in this crazy business we know as retail, we certainly try our best to give you some support. And we hope you can each support each other, too! Leave comments below about your biggest frustrations and struggles in retail. It’s our bet you aren’t alone.

Want more support to help your business thrive? Want to learn about other retailers who you can learn from and lean on? Be sure to checkout Retail Minded Magazine – the nation’s only Retail Lifestyle Publication! Plus, we’re “boutique” like you so we need your support to stay alive!

So it’s important to keep those emotional attachments in mind when figuring out how to manage one of the biggest investments of your life. Should you remodel? Get new floors? Upgrade into more square feet?

It also relates to your mortgage. With interest rates at a record low, money has rarely been cheaper to borrow. But unless you are totally mortgage free, then technically you still don’t own your home. That has a lot of small-business owners asking themselves if it makes sense to pay off their mortgage.

Anyone with the ability to pay off their mortgage is operating from a position of strength, but that doesn’t mean it’s a decision that should be taken lightly. Paying off your mortgage has serious implications, so let’s take a look at 6 things that you have to consider before locking into “true” home ownership.

Cash Flow

How will making a huge lump payment to your lender affect your balance sheet? Liquidity is a key component of any strong financial profile. Having easy access to cash, whether that’s from savings, checking or CD’s, means you have a safety net for the unexpected. Owning your home outright might make you feel a little more secure, but don’t sacrifice too much liquidity to get there.

LTV Ratio

This may sound real technical and maybe even scary, but it stands for loan-to-value ratio. Or more simply, is your mortgage worth more than your house? If that answer to that question is even close to being yes, then run very, very far away from paying off your mortgage early. That’s because longer-term you might actually have the ability to negotiate with your lender if your home falls further in value. Moral hazard is something to consider here, but from a pure financial perspective, borrowers need all the ammunition they can get.

Mortgage Interest Deductions

Tax savings for mortgages are overrated. That’s because in order to pick up the mortgage deduction you first have to spend big, about $1 for every 35 cents in savings. So even though that mortgage deduction feels nice on the tax form, it did cost you some money out of pocket get there. You’ll lose that deduction if you pay off your mortgage, but you also curb your out of pocket expenses.

Money is Cheap

With interest rates at record lows, it’s extremely cheap to borrow money. 30-yr mortgages are dropping at below 4% for qualified borrowers. That means you barely pay off over inflation for access to a big pot of money to dump into a house, providing what is called “leverage” on the Street. Longer term, interest rates will eventually go back up, so taking advantage of a chance to borrow on the cheap definitely makes sense.

ROI

Here’s another thing to consider on the borrowing front; what kind of return can you get on your capital in other investments? If you pay off your mortgage you are getting an immediate 4% return based on a general mortgage rate. But you now also have a 100% cash investment in a house. So the question to ask yourself is do you think you can get more than a 4% return in other places? Like stock? Or bonds? Or even commodities? If the answer is yes, then you are better off shifting your cash into other asset classes.

Expenses

While paying off your mortgage can weigh on your balance sheet, on the flip side, it can seriously boost your income statement. Paying off your mortgage early means losing what is probably your biggest monthly expense. And when operating expenses fall, income and free cash flow increase. That might be a chance to start replenishing your savings to make up for the cash outlay. But not having a monthly mortgage payment is a big appeal to lots of people.

Big Picture

Housing is a very personal conversation for most people. There are strong emotions and large amounts of money involved. But that’s exactly why it pays to have a strategy, because your house and mortgage are two of the most important components in your financial profile. So be sure to keep that in mind when planning your next move.

MONEY MATTERS is a weekly column on the Retail Minded Blog that is contributed by Michael Vodicka, founder of boutique financial consulting firm the Vodicka Group. MONEY MATTERS is Retail Minded’s way of supporting independent store owners with all their financial concerns, real life needs and everyday issues both in and out of their  stores. You can find MONEY MATTERS every Wednesday on RetailMinded.com as well as in each issue of Retail Minded Magazine. 

To begin, “branding” your store and even yourself with great customer service is a fantastic way to stand out from other stores in your community. This can include friendly welcomes into your store, extra little perks such as beverages or sweet treats during store visits, outstanding service for customers who appreciate “the above and beyond” and much more.

For boutiques, the rules are up to you. And so is the challenge. What makes your store stand out? Do your employees represent the same extra special somethings that you do? How can your store – aka your “brand” – be unique in a competitive market? Some tips to help your boutique be the best it can be include:

1. Let your voice be heard. Don’t shy away from any customer that walks through your store, but instead treat everyone as if they are your #1 customer. Spoil them with friendliness, attention and knowledgable product information to help them really experience your store and the products you sell.

2. Brand your boutique. Your logo is one thing, but the overall style you create in your store can help shape the experience your customers have. Use repetitive colors, strong visual appeal, bold features, comfortable additions (think nice dressing rooms or comfy but stylish chairs to sit) that will all help position your store as a leading boutique in it’s enviornment.

3. Be a united team. If there is more than one person working in your store, you should all represent your boutique in a united way. This means from how you greet customers to how you support them as they shop. Strong employee training and expectations can help set this standard among your team.

Remember, part of the appeal of having a boutique is creating it to be an environment that is unique in ALL ways – not just your product assortment. What does your boutique do that makes you stand out? Let us know in our comment section below!