Merchant Maverick https://www.merchantmaverick.com Tue, 28 Jun 2022 15:49:21 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 How To Know When To Hire Employees For Your Small Business https://www.merchantmaverick.com/when-to-hire-employees/ https://www.merchantmaverick.com/when-to-hire-employees/#respond Tue, 28 Jun 2022 15:49:21 +0000 https://www.merchantmaverick.com/?p=148585 Understanding when to hire new employees for your small business is just as important as knowing how to hire them. In general, a hiring decision depends on how financially feasible it is for your business.

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When to hire employees

Understanding when to hire new employees for your small business is just as important as knowing how to hire them. In general, a hiring decision depends on how financially feasible it is for your business. However, whether you should hire a new employee depends on a variety of factors, including your business’s employee needs, your hiring experience, the talent pool, and the pain points in your business’s operations.

This guide explains everything you need to know about when to hire new employees and what you need to consider before making a final decision about growing your business’s team.

Let’s dive in.

How Do You Know When To Hire Employees? The Quick Answer

Knowing when to hire employees can help support sustainable business growth. You should hire employees for your business when you have the funds to cover employment costs, your business’s service or product quality is falling, your current employees are struggling, or you’re looking to grow your business.

The Pros & Cons Of Hiring New Employees

Pros

  • Support your business’s growth
  • Add a new skill set to your team
  • Improve workload distribution
  • Increase productivity

Cons

  • Employee costs (salary, payroll taxes, etc.)
  • Time spent recruiting and training

How To Tell When To Hire Employees

There are a few ways to tell when to hire employees, including a workload that outpaces your business’s current output capacity, falling service or product quality, and inefficient use of resources.

Keep reading for an in-depth breakdown of how to know when to hire more employees for your small business.

Your Business Can Afford To Hire A New Employee

When it comes to hiring employees, your business’s budget is the deciding factor. As the cost of hiring an employee will significantly impact your business’s bottom line, you’ll need to ensure that you have the funds to support paying a new employee.

It’s best to speak with your business’s accountant before making a final move. If you are your business’s accountant, you’ll need to review your business’s reserve funds and annual revenue forecast. Run these numbers against the annual wages you plan to pay a new employee to determine whether your business can afford to pay a new employee.

If your business doesn’t have the funds to support payroll taxes, benefits, and related hiring costs, you might consider hiring a freelancer instead. Freelancers are responsible for covering their own payroll taxes. Additionally, your business can save on benefits costs by hiring an employee rather than a freelancer.

Your Business’s Customer Service Or Product Quality Is Falling

If you are currently turning away new business, failing to maintain quality customer service, or experiencing a drop in product quality, it may be time to hire a new employee.

These issues are generally caused by too few employees handling a large workload.

If you and your team are overburdened by work responsibilities and certain tasks are falling to the wayside, it’s a sure sign that your business could use another pair of hands to help out.

Your Employees Aren’t Using Their Skills Efficiently

While it’s normal for employees to handle a variety of tasks, including those that may not be directly related to their role, it’s a problem when your team’s tech manager is spending their day fielding customer inquiries. Or perhaps you have a cashier who’s always away from the kiosk arranging displays and tracking inventory.

Hiring an employee can help your team stay focused on work that best utilizes their skills, as the new employee can take on the responsibilities that draw your other employees away from their vital work.

4 Questions To Ask Before Hiring A New Employee

If you’ve decided that your business should hire a new employee, there are some important factors to consider before making a final decision.

If you take the time to consider essentials, such as whether hiring a freelancer or W-2 employee is the best option for your business, you can save time and money and make the best hiring decision for your business.

Here are the four questions to ask before hiring a new employee.

SHOULD I HIRE A NEW EMPLOYEE OR IMPROVE MY BUSINESS PROCESSES?

Hiring a new employee or improving current business processes are among the most common ways that business owners choose to mitigate work overload.

However, whether you should hire a new employee or improve your business processes depends on whether the issue can be solved by adding an extra pair of hands or implementing new solutions or tools.

For example, if you’re spending too much time processing payroll manually, investing in a payroll software solution can save you time by automating payroll processes. You’ll be free to handle other higher-value tasks.

Alternatively, if your business needs to unload 1,000 shipments per week and your team is constantly working overtime to reach that goal, it’s time to add another pair of hands to your team.

Ultimately, when deciding between a new employee or overhauling business processes, you’ll need to assess the root of the issue.

Just keep in mind that there are tons of software solutions and tools that can fix various business issues, but very few match the benefits and output of another team member.

SHOULD I HIRE AN EMPLOYEE OR A FREELANCER?

The decision to hire a W-2 employee vs. a 1099 contractor comes down to whether your business needs help handling projects or long-term responsibilities, your business’s budget, and what level of control you’d like to have over the project. Here’s an in-depth explanation of when you hire an employee or a freelancer:

  • Project Or Long-Term Responsibilities: Generally, if you have short-term projects or responsibilities that need to be completed quickly, a freelancer might be a good fit. If your business needs an individual to handle ongoing responsibilities for your business, hiring an employee might be a better decision.
  • Budget: Hiring an employee will require your business’s payroll budget to accommodate payroll taxes, benefits costs, and employee wages. With freelancers, you’re only required to pay for their services.
  • Management: Whether you need to have direct control over the work and its completion will ultimately settle the employee vs. freelancer debate. Freelancers tend to deliver results without much input or oversight into the process of completion. Conversely, employers have full control over both the process of completion and the final product when hiring employees.
HOW MUCH DOES HIRING A NEW EMPLOYEE COST?

The upfront costs of hiring a new employee depend on the starting salary for the position and the type of equipment you’ll need to provide. Generally, the total cost of hiring a new employee is 1.2%-1.4% of the salary you’ll be paying the employee, including:

  • Payroll taxes (FICA, FUTA, and SUI)
  • Workers’ compensation
  • Benefits
  • Recruiting
  • Training
  • Equipment

When hiring an employee, it’s essential to consider both the upfront and long-term costs. Speak with your accountant to get a financial forecast for your business to determine the impact of hiring a new employee.

HOW LONG DOES RECRUITING & HIRING AN EMPLOYEE TAKE?

Recruiting and hiring times vary greatly depending on the role your business needs to fill. Freelancers can be hired in just a couple of hours, and some entry-level roles can take less than a week to fill. Higher-level positions can take months to fill.

Several factors will impact how long it takes to recruit and hire a new employee, including:

  • Local talent pool (if the job is on-site)
  • Experience level requirement
  • Certification requirements
  • Salary and benefits offered
  • Open application period
  • Job posting method
  • Interview scheduling

If you’ll be hiring your first employee or an employee to fill a new role, it’s best to give yourself a generous amount of time to find and hire someone. Growing your business’s team can be a long process, from drafting a job posting to onboarding a new employee.

Landing an employee who is a great fit for your business and holds all the qualifications the role needs is far better than making a hiring mistake that ends up costing your business time and money in the long term.

It’s possible to reduce the recruiting time by setting a job posting close date. However, this tactic can reduce the number of applications you receive.

Is Hiring In A Post-Pandemic & Inflation Economy A Bad Idea?

With the current 8.6% inflation rate and a changing employment market, it’s natural to have some reservations about hiring a new employee.

Hiring new employees is costly enough without factoring in the rising compensation costs that businesses take on. Worse yet, when compensation costs are adjusted for inflation, they have actually gone down by 3.3% in a year-over-year comparison.

Many larger businesses can simply increase pay and benefits to entice workers. Unfortunately, small businesses with limited payroll budgets have trouble increasing pay rates and improving employee benefits packages.

If your small business isn’t able to significantly increase pay or benefits, it’s worth focusing on keeping current staff satisfied and prioritizing sustainable growth.

Childcare stipends, health insurance coverage, and flexible work schedules are among some of the best employee benefits your business can offer.

The Bottom Line On When To Hire Employees

Businesses with the required funds in their payroll budget should hire employees whenever they need another individual to take on responsibilities.

For small businesses, hiring a new employee isn’t just a drop in the bucket; it’s often a substantial financial investment that can result in impressive business growth…or your business could lose valuable time and resources.

Hiring is always a risk, regardless of external factors, such as inflation or the pandemic. When considering those factors, taking as much time as needed to fill your business’s open roles with the best individuals for the job is essential.

If you’re ready to take the next step to grow your business, check out our guide to hiring your first employee for a step-by-step explanation of the recruiting and hiring process for small businesses.

FAQs About When To Hire Employees

When should you hire a new employee?

If it’s financially feasible, your business should consider hiring a new employee to improve your business’s operations, grow your business, and help distribute your business’s current workload better.

How do I tell when to hire more employees?

It’s time to hire more employees when your business is struggling to maintain a high level of customer service or product quality. Before considering hiring more employees, uncovering pain points in your business’s operation is important. Once you know the root of the problem, you can determine whether more employees or improved business processes are the best solutions.

How do I hire my first employee?

To hire your first employee, you’ll need to outline the new role your business needs, draft and advertise a job posting, assess applicants, conduct interviews, and make a final hiring decision.

What to consider before hiring an employee?

Before hiring a new employee, your business should consider:

  • The costs of hiring an employee
  • Time to recruit and hire a new employee
  • Hiring a freelancer vs. an employee
  • Improving business operations
When is it a bad idea to hire a new employee?

It’s never a good idea to hire a new employee if your business cannot afford to pay a new employee. Moreover, it’s important to consider improving your business’s processes before hiring a new employee; doing so may save your business valuable time and money.

What is the average time to recruit and hire an employee?

A 2021 LinkedIn survey sets the average time to recruit and hire an employee at 41 days. However, the average time to hire a new employee depends on a variety of factors, including the talent pool, the role’s pay and benefits, required skills, and more.

 

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6 Best POS Systems For A Consignment Shop In 2022 https://www.merchantmaverick.com/pos-system-for-consignment-shop/ https://www.merchantmaverick.com/pos-system-for-consignment-shop/#respond Fri, 24 Jun 2022 17:56:50 +0000 https://www.merchantmaverick.com/?p=148097 The best consignment store POS system for your consignment shop will depend on your budget, feature needs, business size, and other considerations.

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How Does Inflation Affect Salary Increases & Payroll? https://www.merchantmaverick.com/how-inflation-affects-salary-and-payroll/ https://www.merchantmaverick.com/how-inflation-affects-salary-and-payroll/#respond Fri, 24 Jun 2022 17:55:31 +0000 https://www.merchantmaverick.com/?p=148163 If you run a small business, the question "how does inflation affect salary increases?" may be top of mind for you right now. Does economic inflation lead to salary inflation?  How large should an employee's raise be, considering inflation?

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If you run a small business, the question “how does inflation affect salary increases?” may be top of mind for you right now. But does economic inflation always lead to salary inflation?  And how large should an employee’s raise be, considering inflation?

Record-high inflation hits employees and businesses alike, and ideally, employee salaries should increase as inflation does. However, as businesses battle financial setbacks and rising costs, employee raises are becoming more challenging every day.

This guide will help you navigate inflation’s toll on employee salaries, including an in-depth look at how inflation affects salaries, whether businesses should increase salaries due to inflation, and how to calculate employee raises.

THE CURRENT STATE OF INFLATION & SALARIES

While both inflation and salaries are increasing, inflation is increasing at a much higher rate than salaries. At the current rate of inflation, some salary increases are being wildly outpaced and effectively canceled out. However, inflation’s effect on salary is a nuanced issue with many contributing factors to consider.

Keep reading for a more in-depth explanation of inflation and employee compensation in the US.

INFLATION-ADJUSTED SALARIES ARE DECREASING

Historically, inflation and wage increases tend to follow the same trend, but don’t keep pace with one another.

The Consumer Price Index (CPI) measures the cost of goods in the US and serves as a metric for inflation. Per the CPI’s latest publication, the US is currently experiencing inflation rates of 8.6%, the likes of which haven’t been seen in over 41 years.

Alongside inflation, compensation costs are rising. A year-over-year comparison ending in March 2022 showed that compensation costs increased by 4.5%. Wages and salaries increased 4.7% in the same period. In short, businesses are spending more on employee pay, payroll taxes, benefits, and any additional employee earnings.

However, when you factor in inflation, wages and salaries in the private sector decreased by 3.3% in the same 12-month period ending in March 2022.

[Source: US Bureau of Labor Statistics]

INFLATION ISN’T LIKELY TO GO AWAY ANYTIME SOON

In addition to the usual factors that influence inflation, there are a number of unprecedented and not easily remedied factors that have contributed to the current rate of inflation.

Lingering supply line issues related to the pandemic, China’s current lockdown response to increased COVID cases, Russia’s invasion of Ukraine, and high fuel costs have all created the perfect storm of factors to drive inflation up. None of these issues have simple, tidy fixes, so high inflation is likely here to stay for the time being.

The Fed is working to reduce inflation, but even so, an economic recession is becoming increasingly likely. Moreover, interest rate hikes are unlikely to impact the economy immediately; it generally takes a year for rate hikes to make a significant difference.

While President Biden’s gas tax holiday plan may alleviate some pain at the pumps, there’s not much that will take away from the fact that energy prices have increased by 34.6% in a year-over-year comparison for the period ending in May 2022.

[Source: US Bureau of Labor Statistics]

EMPLOYEES IN THE SERVICE INDUSTRIES SAW THE LARGEST SALARY INCREASES

Employees in the service industries saw the largest salary increase at 7.8% — though the industry also saw the largest rate of quitting, as employees left in droves during The Great Migration. Conversely, those within the construction, maintenance, and natural resources industries saw the lowest rate of compensation growth, at just 4% in the year.

SHOULD BUSINESSES INCREASE SALARIES BECAUSE OF INFLATION?

Whether businesses should increase salaries because of inflation depends on your business’s bottom line. Whichever way you slice it, employee raises cost money. When you factor in the current rate of inflation, giving employees, at minimum, an 8.6% wage increase just isn’t feasible for many businesses.

However, even if your business does not have the funds to raise salaries to match inflation, it’s essential to consider inflation alongside traditional raise factors when increasing employee salaries. An 8.6% inflation rate is simply too impactful to ignore when deciding on a fair wage for your employees.

Moreover, as the Great Resignation has shown, employees aren’t afraid to search for jobs that offer better pay and benefits.

Pros

  • Incentivize and reward employees
  • Stay competitive in the talent marketplace
  • Stave off losses in The Great Resignation
  • Increased wages increase productivity

Cons

  • Increased operational costs
  • May limit the number of employees you can hire

[Source: shrm.org]

HOW TO CALCULATE SALARY INCREASE WITH INFLATION

Whether your business is considering raising employee salaries or you’re an employee looking to propose a raise, calculating a salary increase can be a complex process. To start, there are two different types of salary increases to consider:

  • Fixed Raise: A fixed raise increases employee income by a set amount that doesn’t change based on external factors, such as a $2,000 increase per year.
  • Percentage Raise: A percentage raise is determined by the employee’s current wage and the specific percentage it will be increased.

Regardless of which type of raise system your business uses, you’ll need to know how to calculate an employee’s salary increase. With a salary increase calculation, you’ll be able to give your employee a clear number when providing the raise and have hard numbers to work with when handling the accounting forecasts for your business.

Below, we’ll break down the steps to calculate pay increases for your business.

1. CHOOSE HOW MUCH TO INCREASE SALARIES

Regardless of whether you choose a fixed raise or percentage raise for your employees, you’ll need to figure out how much to increase salary. When deciding how much to raise wages, you should consider:

  • Cost of living
  • Employee performance
  • How long the employee has been with your company
  • Employee value/ROI
  • Employee qualifications
  • Industry wages
  • Inflation

While salary increase considerations will vary from business to business, it’s important to stay as consistent as possible within your own business. Not only will this help provide transparency for your employees, but it will also help to keep things fair for employees in the same position.

2. APPLY THE NEW RATE TO THE EMPLOYEE’S CURRENT WAGE

Once you have a new wage rate, you can apply that rate to your employee’s current wage to get a better understanding of the raise’s impact on your business’s bottom line.

To calculate an employee’s new wage after a raise, you’ll need to either:

  • Add the fixed raise amount to the employee’s current salary
  • Convert the raise percentage to a dollar amount and add that amount to the employee’s current salary

All this means is that you’ll need to plug numbers into an equation. For fixed raises, the equation is as simple as:

(Current Wage) + (Fixed Raise Amount) = (Employee’s New Salary After Raise)

If you’ll be raising your employee’s wage by a set percentage, the equation looks like this:

(Current Wage x Raise Percentage) + (Current Wage)= (Employee’s New Salary After Raise)

When using this equation, express the percentage as a decimal (eg. 40% changes to .4).

To change a percentage to a decimal, simply take the decimal point and shift it left two spaces. If your percentage doesn’t have a decimal point, add .0 to the end of it before converting the percentage to a decimal. For example, 40% becomes 40.0 which converts to .4.

Let’s see this in action. Let’s say your business has an employee that earns $50,000 annually. You want to provide that employee with a 5% wage increase. Plugging those numbers into the equation from above:

($50,000 x .05) + $50,000 = $52,500

With a 5% raise, your employee would go from earning $50,000 per year to $52,500 per year.

3. DETERMINE THE REAL COST OF EMPLOYEE RAISES

Although you’ve got your employee’s new wage sorted, you’ll need to consider the real cost of employee raises to determine whether it is financially feasible to provide your employee with said raise.

  • Increased payroll taxes
  • Increase benefits costs
  • Increase your payroll budget
  • Impact business forecasting

THE BOTTOM LINE ON INFLATION & PAYROLL

With the current rate of inflation, employee earnings are down 3.3% in the last year, despite employee compensation costs rising. While employers are responding to the rising costs by paying employees more and providing more benefits, anything short of a pay raise that is on pace with inflation is effectively a decrease in pay.

However, as employers and employees are impacted by inflation, it can be challenging or impossible for businesses to provide employees with an 8.6% wage increase across the board.

So, if you’re concerned about providing employees with a fair living wage, do what you can. First and foremost, any wage increase should be financially feasible in the long term. It won’t do much good, to your employees or you, if your business tanks in a year.

If you can’t offer a wage increase, consider improving employees’ benefits package. Allowing employees to work from home, improving employee health insurance packages, providing a stipend for childcare, and adding flexible PTO options are all excellent ways to cater to employees’ well-being.

Salaries and benefits are all a part of the payroll process, if you’re interested in learning more about how to improve payroll for your business, check out our guide to payroll best practices.

FAQS ABOUT HOW INFLATION AFFECTS SALARY

How does inflation affect salary increases?

Both inflation and compensation costs tend to follow the same trend, so as inflation rises, salaries tend to rise, too. However, compensation and inflation don’t keep pace with one another, they may rise and fall together, but not at equal rates.

Do salaries increase with inflation?

Compensation costs, including salaries and benefits, tend to increase as inflation does, just not at the same pace.

Should businesses increase salaries because of inflation?

Businesses that have the funds to increase employee wages due to inflation should do what they can to help alleviate the financial pressures inflation has caused. However, if your business is unable to increase wages, it may be worth enhancing employee benefits with options like improved PTO offerings, flexible work schedules, and allowing employees to work from home.

How do you calculate salary increase with inflation?

To calculate a salary increase with inflation, use the following equation:

(Current Employee Wage x Inflation Rate) + (Current Wage)= (Employee’s New Salary After Raise)

Does Merchant Maverick offer a salary inflation calculator?

Merchant Maverick does not currently offer a salary inflation calculator. If you’d like to see us build one, drop a comment below!

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The 8 Best Payroll Software For Accountants https://www.merchantmaverick.com/payroll-software-for-accountants/ https://www.merchantmaverick.com/payroll-software-for-accountants/#respond Wed, 22 Jun 2022 14:14:42 +0000 https://www.merchantmaverick.com/?p=147590 Whether you have one client or 100, there are plenty of payroll software solutions for accountants. The options listed here come loaded with features, are easy to use, and can help you automate the payroll process and eliminate errors, giving you more time to focus on other aspects of your business.

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The 6 Best Trucking Payroll Software https://www.merchantmaverick.com/best-trucking-payroll-software/ https://www.merchantmaverick.com/best-trucking-payroll-software/#respond Mon, 20 Jun 2022 15:41:59 +0000 https://www.merchantmaverick.com/?p=146338 The best payroll software for trucking companies includes trucking payroll-specific features, such as support for multiple pay schedules and rates, IFTA and fuel tax tracking, contractor payments, expense tracking, reimbursements, and more.

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The 10 U.S. States Where Inflation Is Hitting Consumers The Hardest https://www.merchantmaverick.com/us-states-where-inflation-is-hitting-consumers-the-hardest/ https://www.merchantmaverick.com/us-states-where-inflation-is-hitting-consumers-the-hardest/#respond Mon, 20 Jun 2022 14:00:00 +0000 https://www.merchantmaverick.com/?p=147714 Inflation is taking a big bite out of Americans’ purchasing power, but residents of Southern states may be feeling the hit to their wallets more intensely than elsewhere. Merchant Maverick’s inaugural report, The 10 U.S. States Where Inflation Is Hitting Consumers The Hardest, looks not only at where inflation is rising the fastest, but how much existing factors within a given state may contribute to the stress on a household budget.

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Inflation is taking a big bite out of Americans’ purchasing power, but residents of Southern states may be feeling the hit to their wallets more intensely than elsewhere.

Merchant Maverick’s inaugural report, The 10 U.S. States Where Inflation Is Hitting Consumers The Hardest, looks not only at where inflation is rising the fastest, but how much-existing factors within a given state may contribute to the stress on a household budget.

The South is likely a victim of its own success, with key metropolitan areas like Atlanta, Austin, and Tampa absorbing an influx of new residents, predominantly from the Northeast and West Coast. This has generated enhanced demand, particularly for housing, within the region, and has helped to boost prices beyond the national average. This may be particularly hard on existing regional residents, especially in hot markets like Florida, who tend to have lower household incomes than the new arrivals.

Ironically, those left behind in the Northeast appear to be experiencing lower pricing pressures for most goods and services than elsewhere in the country. Despite being home to generally higher prices pre-pandemic, the lower rate of inflation and higher household incomes are helping to insulate New England, New Jersey, and Pennsylvania from some of the worst effects.

Those worried about the possibility of a looming recession may be interested to hear that a few of the Top States Most Likely To Survive A Recession In 2022 are also among the states we found to be least affected by inflation. These include Nebraska, Wisconsin, and New Jersey.

To rank the states, we examined the following metrics (see our methodology below):

  • Consumer price index change  
  • Regional price parity 
  • State sales tax rates 
  • Median household income

Key Findings

  • The South Is Being Hit Hardest: Inflation is a problem everywhere, but the price of necessary staples has risen faster in the Southern region of the country. In particular, Southern states with high sales tax and low median household income may be feeling the biggest squeeze.
  • The Northeast Isn’t Feeling Inflation As Severely: The Northeast, and New England in particular, are experiencing lower inflation rates than the rest of the country (although they are seeing nationally high prices for recreation, education, and communication). States with lower sales tax and high median income did well even considering the region’s generally high regional price parity.
  • Midwestern States With Strong Household Income Are Also Faring Better: Nebraska, Iowa, and Wisconsin made our least-affected list despite relatively high inflation in their region.

The 10 States Most Impacted By Inflation


1. Louisiana


Overall Score: 48.2


Burdened by the highest sales tax rate in the nation (tied with Tennessee) and one of the lowest median household incomes ($51,707, the lowest in the nation after Mississippi), the Bayou State has suffered dearly under the current inflationary economic circumstances.

To make matters even worse for Louisiana, the US South has seen some of the steepest price hikes nationwide. Transportation costs in the region rose 20.6% in the 12 months ending April 2022 compared to the previous year. Housing costs rose 7% – more than any other region of the US (with the exception of Maryland and Delaware, where housing also rose 7%).

2. Florida

Overall Score: 50.2


Florida’s high cost of living relative to other states (regional price parity ranks 36th nationwide, which means it’s higher than that of 35 other states), substantial sales tax (7.01%, 28th nationwide or higher than 27 other states), and low median income ($58,368, putting it in the poorest 10 states) all have the Sunshine State reeling from inflation. Along with its other southern neighbors, Florida is also suffering from a sharp rise in living expenses, including housing, transportation, apparel, and others.

South Florida has been especially hard-hit by inflation and particularly housing and gas prices, with cities like Tampa and Miami experiencing drastically higher prices this year over last.

3. Tennessee

Overall Score: 50.3


At 9.55%, Tennessee has the highest sales tax in the country (tied with Louisiana), coupled with one of the lowest median incomes ($56,627, 43rd in the US). With costs spiking in every category, from food and beverage to recreation, household budgets in the Volunteer State are getting squeezed from all angles.

Housing and utility costs in the desirable Nashville region have been particularly impacted by inflationary pressures, which have only intensified the general upward trend of housing in the region over the past decade. The Wall Street Journal recently reported that Nashville housing prices have nearly doubled over the past 10 years due to an influx of nearly 400,000 new residents.

4. Georgia

Overall Score: 51.3


Georgia is yet another southern state suffering from inflation, as rising prices, low incomes, and high taxes leave precious little wiggle room in household budgets. Georgia’s median household income is just $56,628 (42nd highest in the country) and sales taxes add another 7.35% to every purchase. Meanwhile, the cost of expenses like housing, medical care, and apparel have all risen precipitously across the US south.

Metro areas like Atlanta are seeing especially high inflation, as population increases in recent years have led to high demand for supplies like gas and food, while supply chain woes have rendered these necessities scarcer than usual.

5. Arkansas

Overall Score: 51.8


Again, costs are spiking across the entire US south, and Arkansas is no exception. The Natural State’s residents were already burdened by paltry household incomes (median is $54,539, higher than only 4 other states) and sky-high sales taxes (9.47%, lower only than Louisiana and Tennessee), so families are feeling the impact of higher costs in the worst way.

Local headlines in Arkansas have blamed out-of-control inflation in the state for everything from dwindling food bank supplies to a 20% Y-O-Y drop in Arkansas Lottery revenues (though the end of COVID stimulus programs is also a factor).

6. Texas

Overall Score: 52.0


Texas added more people to its population (310,288) than any other state between 2020-2021. Those new residents are, unfortunately, feeling the weight of the national inflation trend. As is the case with its sister Southern states, the rising costs of transportation and housing are hitting wallets especially hard, the flames fanned hotter by the state’s growing demand.

While the Lone Star State benefits from regionally high median household income (26th), its relatively high sales taxes (37th) and regional price parity (34th) may be amplifying the pain for the average Texan.

7. Alabama

Overall Score: 52.3


Rural Alabama has been feeling the squeeze from the increases in the prices of fuel and fertilizer, which is also hitting food prices farther down the line. The impact on the price of these staples has had a devastating effect on places like Barbour County, which has a median household income 32.8% lower than the state average.

Alabama’s low regional price parity (4th) means Alabamans have traditionally enjoyed a low cost of living, but high sales taxes (46th) and low median household income (44th) leave little room to absorb supply shocks like the ones we’re seeing now.

8. Oklahoma

Overall Score: 52.6


High transportation costs across the Southern region are driving up the costs of goods across the board. And if you’re a state as big and sprawling as Oklahoma, which relies heavily on diesel to deliver goods to stores, the impact of transportation costs can be severe.

Otherwise, the Sooner State’s inflation dilemma is fairly typical for a state in its region. Oklahomans normally enjoy fairly low prices thanks to their low regional price parity (8th), but low state income taxes are offset by high sales taxes (45th), which can cut more deeply into the state’s low median household income (40th).

9. Mississippi

Overall Score: 54.1


Mississippians are feeling the regionally-higher burden of fuel and food costs, especially in counties like Yalobusha, which has a median household income 36.2% lower than the national average and where 18% of households less than $15,000.

When it comes to state-level factors, the Magnolia State’s metrics are very polarized. Mississippi is home to both the cheapest goods and services in the nation (1st) and the lowest median household income (50th). Mississippi fares a little better than some of its southern neighbors, thanks to its sales tax rate (29th), which isn’t too far off from the U.S. average.

10. South Carolina

Overall Score: 54.7


Bringing up the rear of our most affected states is the Palmetto State. One of the ironies of the current inflation crisis is that many of the cities West Coasters and Northeasterners have fled to for a lower cost of living are now seeing higher relative inflation due to increased demand. This includes cities like Charleston, which has seen housing costs balloon nearly twice as much as the national average.

Even though inflation is high in South Carolina, its appeal as an affordable state is justified in terms of regional price parity (10th). Median household income is on the low side of average (33rd), which puts South Carolinians in a better position to absorb costs than some of its neighbors. Likewise, state sales taxes are on the high side of average (33rd), but lower than many of its regional peers.

The 10 States Least Impacted By Inflation


41. Nebraska (70.2 Overall Score): Nebraska is not a bad place to be right now, thanks to its slightly better-than-average regional price parity and sales tax rates (both ranking 22nd out of 50 states) and substantially higher-than-average household incomes ($73,071 or 18th highest in the country).
42. Wisconsin (70.3): The Midwest hasn’t fared as poorly as other regions like the South in terms of rising costs. This has blunted the impact of inflation in states like Wisconsin, which also benefits from low sales taxes (8th lowest nationwide) and has a decent median household income of $67,355.
43. Iowa (70.6): Another midwestern state that’s been relatively insulated from inflation, Iowa has great regional price parity (6th best nationwide) alongside solidly average sales taxes and household incomes.
44. New Jersey (70.9): Jersey and other Northeastern states have a lower relative inflation rate compared to other regions of the country. Additionally, the Garden State has the third-highest median household income in the nation ($87,726).
45. Pennsylvania (71.1): Pennsylvania has been at least partially spared from rising inflation seen in other parts of the country, while sales tax has remained lower than average (17th lowest), and incomes are slightly higher than average (23rd highest).
46. Maine (71.5): The Pine Tree State benefits not only from the Northeast’s lower relative inflation rate, but from relatively low regional price parity (27th) and low state sales tax (9th).
47. Massachusetts (72.1): High household income (4th) and modest sales taxes (16th) help cushion the blow of inflation in The Bay State despite its high regional price parity (45th)
47. Connecticut (72.1): Tied with its neighbor New England state is Connecticut, which has slightly higher sales taxes (18th), slightly lower median household income (5th), and slightly lower regional price parity (42nd).
49. Vermont (72.2): Vermont may not have the lowest cost of living (33rd), but relatively high household income (15th) and low sales taxes (15th) are fortifying the Green Mountains.
50. New Hampshire (74.2): Goods and services aren’t cheap in New Hampshire (43rd), but the complete lack of sales tax (1st) and high median household income (6th) is enough to make the Granite State the top port in the inflation storm.

Raw Data



Methodology

To determine the impact of inflation by state, we gathered data from 10 separate metrics. For each metric, states were given a score out of 100 based on each state’s rank, with the best-ranked state scoring 100 and the worst-ranked state scoring 0. These individual metric scores were then multiplied by specific weights to achieve an overall score for each state.

  • Consumer Price Index Change, 4/20-4/21 (76%): This metric, drawn from the US Bureau of Labor Statistics, measures the change in CPI over the stated year-long interval. CPI is a weighted average of the cost of categories of goods. Published CPI data is regional rather than by state, so there are a lot of ties in the rankings. Categories evaluated:
    • Medical Care (12%)
    • Recreation (8%)
    • Education & Communication (10%)
    • Transportation (12%)
    • Housing (includes utility costs) (12%)
    • Food & Beverages (12%)
    • Apparel (10%)
  • Regional Price Parity, 2019 (8%): This metric represents the relative difference in cost of living between states. A score of 100 is the US average. States with scores below 100 have lower costs of living than the US average, and states with scores above 100 have higher costs of living. The metric accounts for differences in costs of living before the inflation spike began. This metric is drawn from the US Bureau of Economic Analysis.
  • State sales tax rates (7%): This metric measures taxes charged upon the sale of most goods and services within a given state. As these are a percentage of the retail price of goods and services, non-exempt purchases will be even more expensive in states with higher sales tax. Drawn from the Tax Foundation.
  • Median household income, 2019 (9%): This metric represents the typical household income for the state. It provides a sense of how much the typical household within the state will be affected by an increase in the cost of goods. Using the most recent available Census data.

Our data was pulled from four separate sources. These are The US Bureau of Labor Statistics, The US Bureau of Economic Analysis, US Census Bureau, and the Tax Foundation.

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Chase VS Wells Fargo Business Banking https://www.merchantmaverick.com/chase-vs-wells-fargo/ https://www.merchantmaverick.com/chase-vs-wells-fargo/#respond Fri, 17 Jun 2022 15:06:59 +0000 https://www.merchantmaverick.com/?p=147331 Which bank offers better business accounts & services, Wells Fargo or Chase business banking? Compare checking & savings options, fees, rates, & more here.

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Chase VS Wells Fargo

Chase Wells Fargo
Ideal For
  • Fast access to cash
  • Nationwide reach
  • High-APY CDs
  • Nationwide branches
  • Strong mobile app
  • Low balance requirements
Pricing $15/month $10-$75/month
Accounting Integrations Custom; costs $9.95/month QuickBooks Online
Standout Features
  • Fast access to cash
  • Nationwide reach
  • High-APY CDs
  • Low balance requirements
  • Nationwide access
  • Access to credit
What’s Missing
  • No high-yield savings
  • Limits on free transactions
  • High fees for cash deposits
  • Limited cash deposits allowed
  • Low APY

Chase and Wells Fargo both offer business banking services aimed at small businesses. In a head-to-head Chase vs. Wells Fargo matchup, which comes out on top? We’ll look at fees, branch accessibility, account options, and more to help you decide if Wells Fargo business banking is the best choice or if you’d be better off choosing Chase business banking.

Chase VS Wells Fargo: Business Banking Comparison

Wells Fargo business banking provides financial services similar to those offered by Chase. Both offer FDIC-insured checking and savings accounts and physical locations for in-person transactions. Only Chase offers fast access to cash from sales and integrations with whatever small business accounting software you use, however. On the other hand, Wells Fargo comes with the lowest monthly fees. If your interest is piqued, it’s time to take a closer look at these two business banks.

Benefits Of Chase

Pros

  • Up to $500 welcome bonus
  • Monthly fees can be waived
  • Nationwide branch access
  • Built-in merchant services
  • Same-day access to funds from sales

Cons

  • Limited in-person transactions
  • High fees for excess cash deposits
  • No high APY options

If you’re looking for easy access to a physical bank, you can’t do better than Chase and its presence in 48 US states. A Chase Business Complete Checking account includes FDIC-insured checking as well as access to savings accounts, CDs, debit and credit cards, and merchant services. And those merchant services, known as QuickAccept, allow users to access funds from sales almost immediately, with same-day deposits.

At the moment, Chase is offering up to $500 as a welcome bonus to new customers who meet certain conditions. This offer is subject to change; see the Chase website for details.

Benefits Of Wells Fargo

Pros

  • Low opening balance
  • Cash deposits allowed
  • Easy to waive fees
  • Different types of checking accounts available
  • Merchant services

Cons

  • Limited free transactions
  • Low APY
  • Fees for cash deposits

Wells Fargo business banking is a complete solution for small businesses, including easy-to-find physical locations nationwide, FDIC-insured checking and savings options, a strong mobile app, merchant services, and access to credit.

What’s lacking? If you’re looking for a high rate of return on your savings, you won’t find it with Wells Fargo. Although you can take advantage of Wells Fargo savings options, they come with APYs below the national average.

What’s The Difference Between Wells Fargo & Chase Business Banking?

When it comes to business banking, Chase vs. Wells Fargo is a close comparison. Wells Fargo and Chase business banking both offer the small business basics you’ll need your bank to deliver. You will find some differences, however, and these could help you pick one over the other. Let’s take a look at these similarities, first. Our Chase vs. Wells Fargo business banking comparison shows that both banks offer these services:

  • Business checking accounts
  • Business savings accounts
  • Cash deposits (with limits; fees may apply)
  • Debit cards
  • Bill pay
  • FDIC insurance
  • Online banking
  • ATM network
  • Credit cards
  • Certificates of deposit
  • Loans
  • Lines of credit
  • Equipment financing
  • Merchant services
  • SBA loans
  • Telephone support

Wells Fargo Also Includes …

  • Different checking accounts aimed a different-sized businesses
  • Physical locations nationwide
  • Online applications

Chase Also Includes …

  • Cash bonus for new accounts
  • Limit on free transactions
  • No minimum opening deposits
  • Same-day payouts from in-house merchant services sales processing
  • Personal finance management software integrations ($9.95/month)

Chase VS Wells Fargo: Business Banking At A Glance

Chase Wells Fargo
ATM Network
Transfers
  • Mobile deposit
  • ACH
  • Wire transfer
  • Zelle
  • Mobile deposit
  • ACH
  • Wire transfer
  • Zelle
Savings Low APY on savings Low APY
Cash Deposits Free up to $20,000/month Free up to $5K-$20K/month or $0.003 per $1
Mobile App Android & iOS Android & iOS
Bill Pay Fee-free via app Fee-free online
Access To Credit
  • Loans
  • Lines of credit
  • Credit card
  • Loans
  • Lines of credit
  • Credit cards
Merchant Services In-house via QuickAccept In-house

Although our Chase vs. Wells Fargo business banking comparison shows more similarities than differences, there are a few important differences to highlight. Fast access to cash could be an important difference, one that favors Chase. Wells Fargo and Chase both offer users merchant services to let them process credit and debit card payments from customers. But only Chase offers users near-instant access to cash from sales made using its QuickAccept system. Payments processed, approved, and completed by 5 PM Pacific Time Sunday-Friday are eligible; payments outside those parameters are usually available the next day. There are no extra fees associated with using QuickAccept.

Both banks accept cash deposits, although they have different limits and fees attached to excess transactions. Wells Fargo business banking customers can deposit cash in amounts ranging from $5,000–$20,000 per month, depending on what type of checking account you choose, with a fee above the cap of $0.003 per $1. With Chase, you’re allowed to deposit up to $20,000 per month with no fees. Chase does not disclose its excess transaction fee but says “standard” fees will apply to additional cash deposits.

Other Chase Products & Services

Chase offers business credit cards that include some on our list of the best business credit cards. These cards offer choices of rewards and perks, including cash back and generous welcome offers for new customers. Chase also offers business loans, including specialized loans for equipment purchases.

Chase business banking includes merchant services, which are highly rated, and a digital payment app, Chase Pay, that includes a digital wallet and online payment options.

Other Wells Fargo Products & Services

Wells Fargo business loan options include financing specifically for equipment purchases. You can also access a range of business credit cards, with a range of qualification standards, rewards, and interest rates. That includes a secured card for businesses with poor or little credit history.

Wells Fargo also operates its own in-house merchant services account.

User Reviews, Complaints, & Criticisms

Neither Chase nor Wells Fargo is accredited with the Better Business Bureau, although both banks have a BBB profile. Chase has a B- rating with the BBB and a composite rating of 1.1/5 stars based on 448 user reviews. Wells Fargo currently has an F rating with the BBB and a 1.07/5 star rating, based on 556 customer reviews. While we take these ratings seriously, we think it’s fair to note that very few of the complaints listed on either bank’s BBB profile relate specifically to business banking services and many are very narrow and related to users’ specific situations.

Consumer Affairs shows more favorable ratings for both banks, although again the comments and complaints are not specific to business banking services. Consumer Affairs shows a 3/5 star rating for Chase, based on 780 reviews, and 3.2/5 stars for Wells Fargo, based on 735 reviews. While it’s certainly worth perusing the reviews on Consumer Affairs and the BBB, keep in mind that these banks are both more than 100 years old, both offer a range of services including loans and credit cards, and each offers consumer protections such as FDIC insurance and industry-standard security.

Wells Fargo Complaints & Common Problems

Wells Fargo banking customers raise some common complaints. We noticed the following potential patterns in what Wells Fargo users had to say:

  • High fees
  • Unsatisfactory customer service
  • Insufficient response to fraudulent transactions
  • Changing credit limits
  • Holds on deposits

Chase Complaints & Common Problems

We found some patterns in complaints from Chase users, too, including these:

  • Poor customer service
  • Unsatisfactory response to fraudulent transactions
  • Delays in making funds available
  • Difficulty with international transactions

Is It Better To Bank With Chase Or Wells Fargo?

In our Chase vs. Wells Fargo business banking, can we declare a clear winner? Although no knockout blows have been landed, you may have learned enough to decide that one or the other is right for you. Here are our suggestions:

Choose Wells Fargo Business Banking If …

  • You have some cash transactions but process most payments via credit or debit or ACH.
  • You want low minimum balance requirements.
  • Your business uses QuickBooks Online and you’d like to link your accounts.
  • You want easy access to physical branches, even if you don’t mind doing some or all of your business banking online.

Choose Chase Business Banking If …

  • You want same-day access to funds from the sales you process.
  • You want a custom connection between your bank and your accounting software, and you don’t mind paying $9.95/month for it.
  • You would like to waive monthly banking fees without high balance requirements.
  • You need to make some cash deposits, up to $20K/month, without fees

Chase & Wells Fargo Competitors

Of course, we know that each small business, including yours, is different and has a different focus and different needs. So, if you’re not seeing what you hoped to see in this Chase vs. Wells Fargo business banking comparison, don’t worry. We’ve still got you covered!

Check out our complete selection of in-depth business bank account reviews if you feel like doing your own research. Or, if you’d like to look at what we consider the best of the best, start with our list of the best business bank accounts. If you’ve got a bit of cash to stash and want to make sure you’re money’s working as hard as you do, be sure to consider our list of the top high-yield business savings accounts, too.

No matter which bank you choose for your business, make sure you’re prepared to open your account without delays. Visit our post with tips on what documents are needed to open a business bank account, and you’ll be well prepared!

How To Choose A Business Bank For Your Small Business

When you’re picking a business bank for your small business, don’t rush it. Take your time and do your research, so you choose a bank that can be a partner that helps you grow and prosper. On the other hand, the more you learn, the harder it can be to decide. If you’re suffering from decision paralysis, you may need some help choosing the best business bank for your small business.

We’ve got you covered.

Tips On Picking A Business Bank

While it’s true that every small business has its own needs, most will have some things in common too. Use this list of factors to help you in your search for your business banking partner:

  • Available Services: Some things are non-negotiable, like checking and online bill pay. Others may be optional, or simply not important to you, especially if using them means you’ll pay higher fees. Do you need access to credit, merchant services, and eCommerce integrations? If you do, make sure you’re looking only at banks that can meet your needs.
  • Responsiveness: It’s really hard to sift through online reviews for business banks. Visit a website like the Better Business Bureau, for example, and you’ll see a lot of complaints that could turn you off the idea of doing business with a bank. But if you scroll through the complaints, you’ll probably notice, as we do, that they’re not all relevant. That’s why we recommend taking a bank on a test run. If there are physical branches near you, visit them. If not, use the chat, email, or phone options online. How easy is it to find the answers you need? If you find it hard now, think about how you’ll feel when you run into a problem, like a missing debit card or a payment that goes astray. Choose a responsive bank that makes you feel good about giving them your business.
  • Cost Of Doing Business: It’s definitely possible to find a no-fee bank that can save you money each month. But avoiding a relatively small monthly fee should not be the main driver of your search for a business banking partner. The cost of doing business with a so-called zero-fee bank may be higher costs in other areas of your banking business, such as ATM fees, minimum balance requirements, fees for teller interactions or cash deposits, and so on. Avoiding a $10 or $20 monthly fee may not be a smart financial decision in the end, especially if it steers you toward a bank that won’t be easy to work with or that won’t meet your needs as your business grows.
  • Room For Growth: When you’re just starting out, you may not feel like you really need a business bank account. (Spoiler alert: You do — and here’s why you need a business bank account.) As your business grows, your need for banking support will grow too. So look beyond the basics, such as checking, savings, and ATM access. Look for a bank that will support your business in the future. That could mean loans, lines of credit, or credit cards. It could also mean merchant services. Envision your business future and choose a bank that will still be a good partner for you.
  • Access The Way You Like It: Not all banks are created equal: Some offer in-person access to tellers and loan officers, while others ask you to perform all banking functions online only. How do you feel about that? If you have a preference, make sure to choose a bank that can meet you where your needs are. If you’re comfortable working entirely online, you may be able to find a great bank that’s online-only, instead of a bank with physical branches. How about customer service? If you’re a do-it-yourselfer, you may not be too concerned, but if you’re the type that wants personal help, you should look for banks with telephone service instead of email only, for example.

As you can see, there are lots of factors that go into making one bank a better choice for you than another. We present a few more considerations in our guide to opening a business bank account. After all, you have an almost overwhelming number of choices when it comes to picking a good business bank account for your small business. Understanding the differences between banks is a good way to start narrowing those choices.

FAQs: Chase VS Wells Fargo Business Banking

Why is Chase Bank best for small business?

Chase is a great choice for small business owners who are looking for a business bank that offers limited free transactions and low monthly fees that can be waived fairly easily. Currently, Chase is offering a welcome bonus of up to $500 for new accounts. And Chase offers same-day access to money from sales processed through Chase’s QuickAccept payment processing system.

Is Chase good for LLC?

Chase is a good banking choice for LLCs. With all the basics, like FDIC-insured checking and savings accounts, and nice extras like merchant services, access to credit, and top-rated credit cards, a Chase business bank account can meet the needs of mid-size and larger businesses that are ready to grow.

What is the most business-friendly bank?

Any bank can be called business-friendly if it does business in a way that meets your needs. Do you need in-person access, or are you comfortable online? Do you prefer $0 monthly fees, or unlimited free transactions? Decide what matters most to your small business, and choose a bank that offers what you most value.

What bank is better than Wells Fargo?

Wells Fargo is a good bank for businesses that want branch access. Other banks offer different perks. Choose BlueVine if you want interest-bearing checking accounts, Capital One if you want a linked credit card, Relay if you’re looking for small business integrations, or NBKC if you want unlimited free transactions. Square Business Banking can be a good choice for businesses using Square to process payments, and Live Oak and NorthOne offer strong online support. Don’t forget about credit unions like Digital Credit Union, too.

Is Chase Bank safer than Wells Fargo?

Chase Bank and Wells Fargo are both safe choices for business bank accounts. They both offer FDIC-insured accounts and industry-standard security measures.

Who has more branches, Wells Fargo or Chase?

Wells Fargo has 7,000+ branches and 13,000 ATMs in the United States. Chase has 4,700 branches and 16,000 ATMs in the US. However, Chase is the biggest bank in the US, with $3.31 trillion in assets, compared to Wells Fargo which, at number 3 in size, has $1.78 trillion in assets.

Wells Fargo VS Chase Business Banking: Which Is Better

Chase vs. Wells Fargo is another competition between two worthy rivals. Wells Fargo business banking may be the right choice for you, or you may decide that Chase business banking offers more of what you need. We hope this comparison has helped you understand these two options a little more and, hopefully, has shown you which choice is right for your small business.

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6 Best Small Business POS For Macs In 2022 https://www.merchantmaverick.com/pos-for-macs/ https://www.merchantmaverick.com/pos-for-macs/#respond Thu, 16 Jun 2022 15:01:37 +0000 https://www.merchantmaverick.com/?p=146898 When selecting POS software for Mac, there are a few factors to consider. Not only should your software fit within your budget, but it should also be intuitive, easy to use (and teach to employees), and have the features you need to make business operations more efficient.

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6 Best Smal

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How To Get Business Credit Cards With An EIN Only & How To Get Started https://www.merchantmaverick.com/business-credit-cards-ein-only/ https://www.merchantmaverick.com/business-credit-cards-ein-only/#respond Wed, 15 Jun 2022 22:39:13 +0000 https://www.merchantmaverick.com/?p=147443 Most business credit card issuers require your SSN when you apply, as this allows them to perform a hard inquiry on your personal credit report and to establish the personal guarantee that most business credit cards require. However, in certain instances, it may be possible for you to obtain business credit without providing your SSN and avoid personal liability and a hard credit pull. This article will detail the circumstances in which you can apply for business credit cards with your EIN only.

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Can you get a business credit card with just your EIN and not your Social Security Number (SSN)?

Most business credit card issuers require your SSN when you apply, as this allows them to perform a hard inquiry on your personal credit report and to establish the personal guarantee that most business credit cards require. However, in certain instances, it may be possible for you to obtain business credit without providing your SSN and avoid personal liability and a hard credit pull. This article will detail the circumstances in which you can apply for business credit cards with your EIN only.

What Is An EIN (Employer Identification Number)?

Your Employer Identification Number is a nine-digit number assigned to your business by the IRS for tax ID purposes. Unlike your SSN, it is associated with your business, and not with you personally. In certain circumstances, you may be able to use your EIN to apply for and obtain a credit card for business use.

Is It Harder To Get A Business Credit Card Without A SSN?

If you’re looking for a business credit card you can apply for without submitting your SSN, the unfortunate reality is that cards marketed as “business credit cards” nearly always require you to supply your SSN during the application process. However, as we’ll explain, there are credit products you can obtain without providing your SSN — products that can be used to fund your business.

Why Get Business Credit Cards With Your EIN Only?

The primary benefit of getting business credit cards with your EIN only is that you won’t be held personally liable for any debts incurred — only your business will be liable. Here are a few other specific situations where you might benefit from EIN-only credit cards.

Apply For EIN-Only Business Cards If…

  • You Have Bad (Or No) Personal Credit: Applying for a credit card with your SSN usually (though not always) means that your personal credit will undergo a hard pull and that applicants with an insufficiently strong credit profile won’t qualify. When you apply for a business credit card with EIN only, your personal credit won’t be a consideration.
  • You Don’t Have A Social Security Number: People who are not US residents and who use an Individual Taxpayer ID Number to request an EIN from the IRS can apply for and use an EIN-only credit card.

I should note that if avoiding a personal guarantee is your primary concern, there are credit cards that won’t make you sign a personal guarantee but which nonetheless require you to provide your SSN on the application. Our list of the best business credit cards that don’t require a personal guarantee contains several such options.

Don’t Apply For EIN-Only Business Cards If…

  • If Your Credit Health Is Decent: If your credit health is decent (or at least meets the minimum requirements of the business credit card in question) and you don’t specifically stand to benefit from specialized products like corporate business credit cards, you may as well apply for a business credit card with your SSN. Any hit that your credit score takes from the resulting hard credit inquiry can be more than counteracted by responsible card use. Read our guide to improving your personal credit score for more information on building a strong credit profile.

Startup Business Credit Cards With EIN Only

Some startup owners may be able to qualify for startup business credit cards with their EIN only. These cards are known as corporate credit cards (or corporate business credit cards). These cards often don’t check your credit at all and instead rely on factors such as your business’s revenue, spending patterns, and cash balance to determine creditworthiness. However, as we’ll explain in the next section, corporate credit cards aren’t suitable for all startups.

What Types Of Business Credit Cards Can You Get With An EIN Only?

There are a number of business credit products you can obtain while only providing your EIN on the application. Let’s go through your options.

Corporate Business Credit Card

Corporate business credit cards (commonly known as corporate cards) differ from traditional business credit cards in that legal responsibility for all charges falls to the corporation, not the business owner. Additionally, corporate card accounts let you issue employee cards to your staff. Their business-related spending will be covered, and all rewards/points/miles earned will go to the corporate account.

While corporate credit cards have their benefits, the downside is that they typically require your business to be a corporation/LLC and have stringent requirements relating to your business cash flow, money in the bank, investor capital, etc. Essentially, if you’re running a small coffee shop or neighborhood hardware store, you won’t qualify for most corporate cards.

The card that set the stage for the corporate card industry was the Brex Card. As we noted in our Brex review, the Brex corporate card is designed for startups with exceptional growth potential — particularly tech startups. With a lucrative benefits program that rewards spending on common startup expenses, a cash management account, spend management tools, and no requirement that you provide your SSN (accordingly, no credit check is performed and no personal guarantee is required), Brex is quite a deal for high-powered startups.

However, Brex requires that your business be a C-corp, S-corp, LLC, or LLP corporation with at least $1 million in a US bank account (or $50,000 if your company is backed by professional investors) — requirements that will exclude many small businesses.

Corporate Store Credit Cards

While a corporate store credit card falls short of being a true business credit card, it can be a source of credit for stores at which you make frequent business purchases. What’s more, certain store-specific credit cards don’t require a personal guarantee and can be obtained with just your EIN. You may be able to earn discounts and/or cash back/points with your spending as well.

Corporate Gas Cards

Corporate gas cards, also known as fleet fuel cards, can be handy payment instruments if you and your employees do a lot of business-related road travel. Some such cards can be applied for using just your EIN and do not require a personal guarantee. Of course, these cards can only be used for purchases at gas stations, so their utility is limited.

Our list of the best fuel cards for trucking companies details some of the best fleet fuel cards currently on offer.

Prepaid Business Cards

With a prepaid business credit card, you simply put a balance onto the card prior to use and then spend up to that balance. These cards don’t replicate the functions of a true business credit card and can’t be used to build business credit, but they do allow you to track your business spending. These cards don’t require a personal guarantee, and many of them can be applied for with just your EIN.

Alternative Business Credit Cards

There are a few business credit cards that won’t require a personal guarantee, though they do come with some limitations.

Secured Credit Cards

With a secured credit card, you make a security deposit that establishes the amount of your credit line. With some secured business credit cards, you can apply with your EIN instead of your SSN and avoid personal liability. One such card is the Wells Fargo Business Secured credit card.

The Wells Fargo Business Secured card requires a security deposit of between $500 and $25,000 while giving you a choice between earning cash back and earning reward points. Responsible use of the card can help you build your business credit (not your personal credit) while not requiring a personal guarantee or your SSN.

How To Build Business Credit With Your EIN

When you use your EIN to apply for a credit card, instead of your SSN, your credit card issuer will typically report your credit card use to the business credit bureaus (though you should confirm this with the issuer) but not the personal credit bureaus. This means that so long as you use your credit card responsibly, you can build your business credit and eventually become eligible for better credit products as your business credit score rises.

Read our guide to improving your credit score for more helpful information on the matter.

FAQs About Business Credit Cards With EIN Only

Can you get a business credit card with just your EIN number?

Yes. While most business credit cards require you to list your SSN on the application, certain business credit cards will allow you to apply with just your EIN (or, on occasion, your ITIN).

What can I apply for with EIN only?

Certain corporate credit cards, such as the Brex card, allow you to apply with just your EIN — your SSN is not required. Likewise, certain secured business cards can be applied for with just your EIN.

Can I get a business credit card with no business income?

Yes. You may be able to qualify for a business credit card without any business income. You will have to be drawing an income in some other way, however.

How do I build my business credit with my EIN number?

If you apply for and obtain a business credit card using your EIN number, you may be able to build your business credit with responsible card use. Just make sure that your card issuer reports your card activity to the business credit bureaus.

Can I use an EIN instead of an SSN?

Certain credit card issuers allow you to apply for your credit card using just your EIN (or, occasionally, your ITIN) and not your SSN.

Should You Apply For A Business Credit Card With An EIN Only?

If you’re seeking to apply for business credit cards with your EIN only, you’ll be narrowing your range of options significantly. That’s why most small business owners shouldn’t exclude business credit cards that require an SSN from consideration (unless, of course, you don’t have an SSN). However, if you’re determined to get an EIN-only business credit card, know that there exist several options that can both help you fund your business and build up your business credit, provided you make your payments and don’t carry an excessive balance.

For a good general overview of what you’ll need to do, our step-by-step guide to getting a business credit card is a must-read. Checking it out should put you in a good position in your search for business credit!

The post How To Get Business Credit Cards With An EIN Only & How To Get Started appeared first on Merchant Maverick.

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Boonie Foods: Bringing An Authentic Taste Of The Phillipines To Chicago’s Revival Hall https://www.merchantmaverick.com/spotlight-boonie-foods/ https://www.merchantmaverick.com/spotlight-boonie-foods/#respond Wed, 15 Jun 2022 17:22:13 +0000 https://www.merchantmaverick.com/?p=147595 Recently, Merchant Maverick sat down with $10K Opportunity Grant winner, Chef Joseph Fontelera, to discuss how his business has been faring since he received the grant money. Read on to learn more about Boonie Foods and its dual mission to introduce the delicious universe of Filipino cuisine to people who have never experienced those flavors before -- and to be a taste of home for Filipino expatriates.

The post Boonie Foods: Bringing An Authentic Taste Of The Phillipines To Chicago’s Revival Hall appeared first on Merchant Maverick.

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In 2022, the Merchant Maverick Opportunity Grant Program was privileged to give a total of $100K to Americans of Asian and Pacific Island descent, via 10 separate grants of $10K each. One of these grants was awarded to Boonie Foods, Inc., a pandemic-born restaurant located inside Revival Hall in Chicago. Boonie Foods specializes in Filipino-fusion cuisine and has been featured in the Chicago Tribune, Chicago Magazine, and Eater Chicago.

Recently, I sat down with the owner, Michelin Bib Gourmand recipient Chef Joseph Fontelera, to discuss how his business has been faring since he received the grant money. I also wanted to learn more about Boonie Foods and its dual mission to introduce the delicious universe of Filipino cuisine to people who have never experienced those flavors before and to be a taste of home for Filipino expatriates.

Julie: How have things been going since the grant?

Joseph: Great! Thank you once again. It was a huge help, and I think may have added years to my life from the amount of stress it has reduced from it. Yeah, things are going well. I was able to use some of that to invest in getting cleaned up on the back end and some equipment that we’ve needed. Also, I was able to help reimburse employees for commuting, making it much more pleasant for them to come to work. Outside of that, it’s just been really busy, so things are good. The grant really helped me to till the soil so to speak. I can see the trajectory growing a lot better and a lot more hopeful than it was prior, so thank you.

Julie: That’s really nice to hear. For the purposes of this interview, we want to know more about the business. When did you first decide you wanted to own a business and how did you get started with this one?

Joseph: So, I was furloughed for a little bit in 2020, and I had some free time, so I decided to start exploring what it would be like to cook Filipino food at all different levels because it’s not something that I’ve ever done professionally despite having a pretty varied and lengthy career. I felt like this is where I think I want my future to go, at least my near future. Eventually, I came back to work but was still trying to be in touch with that part of me that was awakened during my furlough and started doing pop-ups. Eventually, I came upon the name of Boonie Foods, so I was doing pop-ups as Boonie Foods during the latter half of 2020. And then as 2020 was coming to a close and I was working really really hard at my full-time job, I started thinking I can’t be splitting my efforts like this, or I’m just doing a half-hearted job at both. It was at the end of 2020 that I decided to bet on myself, quit my job, and do this, and I’ve been reaping the dividends ever since.

Julie: That’s interesting. What was your full-time job? Were you a chef somewhere else?

Joseph: Yeah, I was a chef of this restaurant called Arami [in Chicago], the Executive Chef of the Hospitality Group. So that was what I was doing from 2015 until 2021.

Julie: So you had no experience cooking Filipino food before that? Did you rely on recipes you had learned growing up or fall back on your professional skill set?

Joseph: It’s a little bit of everything. My grandmother had shown me a couple of things, so I stretched my recall of that as best as I could on top of doing a lot of research and reading a lot of books. I’d been to the Philippines a couple of times before, so I relied on my memory to make everything taste right. But in a professional sense, I’d never done Filipino food. I’d done some stuff here and there at home, but it’s not something I had devoted much effort and brain space to until 2020.

Julie: It’s impressive to me that you managed to nail the cuisine well enough for people to have a nostalgic experience when they’re eating it and think of it as really authentic Filipino cuisine. I think you have to be a pretty good chef to make that work, after not having been officially trained or growing up there. What were some of the challenges you faced when you were first really starting to get the business up and running?

Joseph: It took a while, aside from the normal business challenges — finding capital and getting your team together and all that stuff, which actually really was second nature to me. At this point now, not counting Boonie Foods, I’ve opened six or seven concepts already, so it’s a challenge, but it’s also one I’m familiar with. I think the biggest challenge was refining the concept into where it is now and where I see it going. I didn’t want it to be a traditional Filipino restaurant that’s very stuck in the past, but I also didn’t want to really lean too much into making the cuisine weird. I wanted it to be familiar to my elders, the ones that have passed this down to me, while also being relatable to my peers and the next generation. So that, I think, was actually the most difficult part. That and managing the stress of the first part that I was talking about, getting the capital financing, finding a space, and so on and so forth.

Julie: How did you go about getting capital?

Joseph: I dipped into basically all of my savings. Towards the end of 2020, I knew this is what I wanted to do, so I squirreled away as much of my paychecks as I could. I estimated what it would cost me to open up in a situation like Revival [Revival Food Hall in Chicago] as opposed to a full-on brick-and-mortar. I just kind of set my targets and was really focused on making sure that I hit them.

Julie: Our founder, Amad, did basically the exact same thing. He just bet on himself, the rest went on credit cards, and here we are. Yeah, you can make it work. Can you describe the typical customer that comes to Boonie?

Joseph: The majority would be the office folks that populate the Loop. We’re out here near a lot of big corporate offices. But what’s really meaningful to me is that I would say a significant percentage of our customers are people that have heard of us and will travel. For the most part, they’re Filipinos that come from all around the Midwest. There are the folks that have come for the consulate because they need to fix some paperwork and then find out about us on the internet. And then there’s also the people that are semi-local from the Chicagoland area or the surrounding suburbs that have found our buzz on the internet and have come through. Those are our two demographics.

Julie: Do you have a favorite memory of customer interaction?

Joseph: There’s a lot, you know. If you read the stuff that I’ve been posting on all my social media, engaging with the community, and engaging with the audience is very important to me. We have a lot of folks that read our content and can see that as an organization we’re easy to approach. They’ll sit at our counter, and I like to think, with our consistent regulars, that I have a unique relationship with all of them. It’s a nostalgic feeling that people get, and they talk about relatives that have passed that made a dish that’s on our menu. It’s hard to narrow that question down to one specific thing.

Julie: What are you most proud of with the business?

Joseph: I think I’m most proud of just existing in the capacity that we do. We’re not a faceless chain that’s there just to sell food. When I think about our most consistent regulars and even folks from all across the United States that have visited us and still keep in contact, it really makes me feel good. The message, the vibe that I’m trying to put out really resonates with people. So that’s what I’m most proud of, being kind of a beacon for the community in a town that has a lot of people but not a lot of Filipino restaurants.

Julie: You’re right to be proud of that. It is impressive. So what do you think your biggest fear for the business is going forward?

Joseph: I don’t know, I guess I don’t really think about that. My MO is to be like a rhinoceros or like a train, just keep going. If we hit a snag somewhere, we’ll deal with it when we get there.

Julie: I think that’s a fair approach. If you have that train approach, obstacles will get knocked down pretty quickly.

Joseph: I think that after having — and with your help definitely — but after having survived the Omicron surge that drained all of our resources…I don’t know if this is trauma speaking, but I’m kind of in a place where, okay, if we can survive that on top of the incredibly slow start that we had because of the pandemic without other resources, then I’m not too worried. We’ll deal with problems as they happen.

Julie: I think that’s fair. If this is a concept where you can survive all that has happened in America over the last two to three years, it seems like you’ve proved that concept at this point.

Joseph: Thank you, that means a lot.

Julie: In what ways would you say you’ve had to adapt because of the pandemic? I’m guessing that’s an unusual question for you since you started during the pandemic, but how does the way you operate Boonie Foods differ from how you operated restaurants before that?

Joseph: With the nature of the food hall, everything is even thinner than it would be. I come from a background of sit-down restaurants or big outlets where, I don’t want to say there’s a lot of money, but there’s a lot more wiggle room to do stuff. At the food hall, every second counts because every second that one thing takes up, that’s less time I have to capture the next customer. In terms of adapting, I wouldn’t say that it’s pandemic-specific, except for the Omicron surge, but every day is just trying to figure out how to make it more efficient without it losing its soul. So in terms of shifting or changing, that’s where my mind is at. When Omicron hit, we had to pivot to making take-home-and-cook-it-yourself kits. That was what we did when we first started doing pop-ups in 2020. I was doing a lot of that, so I brought that back. I guess that’s kind of the only pandemic-specific answer that I have for it.

Julie: A lot of restaurant owners, but AAPI restaurant owners, in particular, it seems, rely on family and family connections for staffing restaurants or as financial support. How has your family played a role in starting and running Boonie Foods, if at all?

Joseph: Well, I operate with my partner, and she’s great. She’s our front-of-house extraordinaire. But in terms of my family, they’re my number one fans, and I love that. Thankfully, I’ve not had to ask them for really any financial support, but they come and grab food fairly often so that’s always nice.

Julie: Yeah, I think that if they like your cooking then you’re doing it right. Is there anything else you’d like to tell us?

Joseph: I’m just really happy and grateful for where we’re at and very thankful for all the help that your company was able to provide for us. I’m just kind of enjoying the moment and staying positive.

Julie: Yeah, enjoy it. We’re just here to make your business look good!

Joseph: Thank you. I appreciate it, really, from the bottom of my heart. I totally mean it when I say that I feel like years of my life have been returned back to me because I’m not super stressed out all the time.

Julie: That’s really good to hear. That makes me feel good. It was a pleasure talking to you, and we’ll be in touch soon.

Joseph: Take good care.

Visit Revival Hall in Chicago to taste some of Joseph’s celebrated Filipino cuisine in person. You can order spicy coconut milk shrimp or garlic pork sausages online via the Boonie Foods website, or follow the company on Facebook and Instagram.

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