With the advent of the internet and the transition of purchasing offline to online there has been a revolution in the way that people work, communicate and operate a business. There are numerous ways to earn a passive income through online residual income businesses which all require initial time (and sometimes financial) investment. Depending on the businesses that you choose to earn a passive income with, there are varying degrees of time, money and risk involved which are all discussed in more detail below.
Passive income is a revenue stream that you receive through online and offline business investments. An example of an offline passive income source would be through a real estate property that you rent out to a tenant and subsequently receive a monthly rent with minimal effort required on your behalf. An example of an online passive income would be through writing an eBook and selling it online. Sales of your eBook will occur regardless if you are on your computer or not. With advancements in online automation and technology there has never been a better time to start earning a passive residual income online.
In contrast, active income is defined as income from a source (or sources) for which services have been performed. Simply put, a value is placed on the time that you perform work and when you are not working you do not receive any income. A wage or salary earned from a job is an example of an active income.
So in thinking about what kind of income that you currently earn and what you would like to earn in the future, I would like to remind you of the most precious commodity in the world…your time. Your time is not renewable (unless you believe in reincarnation), you can’t buy, rent, save or borrow time, and as you get older and your health deteriorates, your choices on how you spend your time becomes limited. Interestingly, as you get older your perception of time changes, as time seems to speed up and there seems to be less time in the day. So with an extremely finite resource that is biologically determined, your choice in how you utilise your time becomes an extremely important consideration.
So the most pertinent question after learning that your time is finite is what are your goals in life… such a deep question for a website I know, but as we live in a world built on capitalism then it won’t surprise you that most of your goals will be linked to some sort of financial caveat. So I am going to go out on a limb and suggest that your life goals will be intrinsically linked to financial freedom and if I am wrong then you are in a fantastic position in your life and I encourage you to share your experiences with others. If not, then the next logical question is how do you intend to achieve financial freedom? May I suggest the answer to this question is passive residual income!!!
So to get you started, I have developed this table to help you with kick starting your goal of financial freedom with a comprehensive list of passive residual income investments ideas that are explored in more detail below. Each of the passive residual income investments ideas takes into consideration the following elements that may impact on your decision to explore the idea in more detail and I stress that each element is assessed subjectively based on experience and is of course open for debate.
- Initial financial investment
- Initial and ongoing time commitment
- Marketing for customers required
- Location specific
- Return on investment expectations
- Risk assessment based on time and financial investment
The one point that I will stress is that it is important to have multiple streams of passive income. In finance terms this is called diversification or put another way, don’t put all your eggs in one basket. However, if you are just starting out with developing your passive residual income, then I suggest you focus on one passive residual income idea first and developing it into a stream of income before moving on to another idea.
|Passive Income Source||Initial Investment ($)||Time Commitment (Initial/Ongoing)||Customers Required (Marketing)||Location Specific||Return Expectations||Risk (Time and $)|
|Write and sell an eBook||+||+++/+||+++||-||+||+|
|Sell products through your blog||-||+++/+||+++||-||+||+|
|Sell a product through your website via affiliates||-||+++/+||+++||-||+||+|
|Sell other peoples products (affiliate seller)||+||++/+||+++||-||+||+|
|Sell advertising space on your website||-||-/-||+||-||+||+|
|Build and sell an App for mobile devices||+++||+++/++||+++||-||+||++|
|Peer to Peer lending (P2P Lending)||+++||+/+||-||-||++||++|
|Resell online products and services (web hosting)||-||+++/+++||+++||-||+||+|
|Create your own widget and sell online||+++||+++/++||+++||-||++||++|
|Royalties from your content library items (photos, icons, infographics, music)||+||+++/+||+++||-||+||+|
|Software development and ongoing resale||+++||+++/++||+++||-||+||++|
|Buy an existing successful online business and manage ongoing operation||+++||++/++||+++||-||++||++|
|Sell the license for your idea or patent||+++||+++/-||+||-||++||++|
|Create a business system and franchise it out||+++||+++/+||+++||+||++||++|
|Utilise a reward/discount/cashback programs||+||+/+||-||+||+||+|
|Create and sell an Online Course||+||+++/+||+++||-||+||+|
|Multi Level Marketing||+||+++/++||+++||++||+||+|
|Rent out a spare room in your house||-||+/+||+||+++||++||+|
|Buy an investment property and rent it out||+++||++/+||+||+||++||+|
|Investment portfolio managed funds, shares & dividends||+++||++/+||-||-||++||+|
|Contracts For Difference (CFDs)||+++||++/++||-||-||++||++|
|Car share on your usual commute||+||+/+||+||+++||+||+|
|Silent business partner or Angel Investor||+++||+/+||-||-||+++||+++|
|Insurance broker or Mortgage broker||++||+++/++||+++||++||++||++|
|Pension or Superannuation income||+++||+/+||-||+||++||+|
|Interest from a Savings account||+++||+/+||-||-||+||+|
Writing and Selling Your eBook
It is possible to earn a passive residual income from writing and selling your eBook online with little upfront investment capital.
Publishing a book used to be reserved only for authors that were approved by publishing houses and during this process, authors were lucky if they arranged a suitable commission to renumerate them for the considerable amount of time they spent writing the book. In our modern digital world it is now possible for anyone with a smart phone to publish on the internet and eBook publishing has exploded in popularity.
Writing a digital book initially takes some work and time but requires very little capital investment. There are also many ways you can get help with writing your book with freelancers available to help you research, ghost write and develop graphics for your book and front cover.
Once you have written your eBook then the easy part is over. The hard part is marketing your self-published book that you have either put on Amazon (or similar eBook market) or as a pdf on your blog or website. There are numerous ways to market your eBook, but I urge you to develop your marketing plan prior to writing your eBook so that you know your niche, competitors, target audience, geographic market, expected marketing budget, marketing methods (Adwords, Facebook etc), expected sales (please be realistic) and whether you can use affiliates.
Once you have written and published your book online, and have launched your marketing campaign then you can simply monitor and adjust your marketing plan so that you can enjoy a passive residual income from your eBook.
Resources for writing and selling your eBook:
eBook Market places: www.Amazon.com
eBook affiliate marketplaces: www.clickbank.com
Income From Your Blog
It is possible to earn a passive residual income from your blog with little initial capital investment.
The number of bloggers around the world has exploded and will continue to increase exponentially as more people have access to smart hand held devices across the globe. If you are new to blogging then I would encourage you to pick a topic that you are passionate about and writing about that rather than picking a specific product or niche and then writing to that audience. The reasoning for this advice is simple… You will continue to write about something that you are passionate about and you will stop writing about something that you are mildly interested in.
The aim of the game is to increase your blog subscribers over time by providing new and interesting content on your topic. As your blog grows in popularity then so will your opportunities for selling your own products, affiliate products or advertising space on your blog.
I have met numerous travel bloggers that manage to negotiate free (or very cheap) deals at hotels, restaurants, cruises and theme parks. They do this by offering to review the service inn question on their blog to their 10,000+ readers, who would be very interested in travelling and visiting these services. Similarly, influential food blog writers are often invited to eat at new restaurants and cafes for free providing that they review the service in question.
So the million dollar question is how do you get readers to your blog? There are numerous resources to help you with this question, but the simple answer is that it will require you to update your blog daily with new and interesting content, offer insights and deals that are exclusive to your blog, engage with your readers, and constant marketing and promotion of your blog.
You can also outsource the development of your blog posts using a freelancing website, and most blog applications enable you to que up your blog posts and automatically post for you at set dates and times. This means that you could write all your blog posts for the month on one day and have them posted throughout the month. It is important to respond to readers’ comments though, so that you engage with your audience and encourage continued subscription.
Blog writing can be extremely profitable and a fantastic source of passive residual income, however most of the gurus will tell you that you may not receive any income for 12 to 18 months so it is imperative that you write about something that you are passionate about so that you keep true to this passive residual income business endeavour. What are you waiting for… start blogging now for your passive residual income.
Resources for generating income from your blog
Free blogging service: www.weebly.com (paid when you want to remove ads)
Affiliate marketplaces for products to sell on your blog: www.clickbank.com
Sell Other Peoples Products Through Your Affiliate Link
One of the most easy and affordable ways to get started earning an income with a passive residual income source is through affiliate marketing. An easy way to explain affiliate marketing is whereby you promote a particular product and when a consumer purchases that product through your affiliate web link then you receive a commission from the person that is selling that particular product. The size of the commission varies according to the product, company and the deal that they have entered with the affiliate.
There are literally millions of products and services online that are associated with an affiliate program that you can sign up for free, start promoting and receive a commission.
Companies utilise affiliates because it allows them to divert resources away from marketing and publicity (tasks easily done by somebody outside the organisation) while still reaping the majority of sales profits.
The minimal initial investment, low-risk nature and integral data analysis involved in affiliate marketing mean that with insight and experience these slimmer commissions can be optimised for producing vast amounts of revenue.
There is no payment or membership cost required to be an affiliate. That said, exclusivity among affiliates does exist: Depending on the marketplace, some companies may require their affiliates to have a level of income or other measure of reputation, so that they can be confident that their products will be represented professionally.
As an affiliate you have control over which brand you choose to advertise. You have a multitude of tools at your disposal that enable you to optimise your ads for the services that you choose to market.
Opting to represent companies from different categories is a good practice for beginner affiliates. Customers will be encouraged by a professional looking site when they are deciding whether or not to make a purchase. Therefore it is important that you practice using the site and look for signs that visitors will be reassured when they follow your affiliate link.
Profit margins depend on the nature of the product or service that you are selling. If your affiliate link is to a subscription-based service, for example, then you receive a commission from every recurring payment – as well as the cost of the original purchase. This is an example of how your ads can act as a source of organic passive income, generating revenue into the future without requiring additional sales.
Magazines, financial market indicators, web hosting, sports betting software and gaming memberships are fruitful examples of recurring billing.
Clickbank.com has a renowned affiliate marketplace with a maximum of 4 months sales history for its listings. This is an example of products having limited background information, where the performance of services that are subject to seasonal boom or current events is significantly skewed. In the same vein, ensure you plan ahead for affiliate deals that will become more rewarding in the foreseeable future.
Choosing to support certain products should often be an examination of the demographic that they cater to. Marketing products to children, for example, would prove foolhardy as they are not financially independent – while retirees or childless couples both have significantly more monetary security and surplus. Dangers like this are avoided by assuming the perspectives and understanding the economic background of your target consumers.
The most common tool for new affiliates for new marketing campaigns is Google Adwords. It enables affiliates to place pay per click links on Google and associated websites. Within Adwords there an many analytical tools including Keyword tools that enable you to view statistics associated with any search term. These can be saved and filed under your own categories, promoting the use of multiple ad campaigns. Adwords displays the frequency of searches, cost of using each keyword, as well as suggestions for other relevant tags. Generally speaking, the keywords with greatest popularity and relevance will be priced the highest. Affiliates can select the keywords that they would like to be featured in their campaigns – which is always governed a balance of generating high exposure whilst not blowing out a single day’s budget for the cost of a few (albeit well-placed) ads.
Avoid using vague terms and blanket statements in your ads so as to be more targeted: As an affiliate you are paying per ad that the search engine places, while trying to exceed that cost with the commission from successful purchases. If imprecise ads accrue high traffic but low instances of visitors who are willing to spend money on the actual product, then the cost of stirring up so many shoppers will far outweigh an affiliate’s profits.
Semrush is a site that grants users comprehensive information about the performance of affiliate links that are embedded in specified sites. This is valuable because your personal blog or site can be constructed such that it generates considerable revenue through your own affiliate links. This tool also adds a competitive edge; allowing you to analyse competitor’s sites – and climb to the top of search results.
Resources to help you with affiliate marketing
Link Analysis: www.semrush.com
Sell Products Through Your Website with Affiliates
So you have a product and an associated website and you might have sold a few units to your friends and family but you aren’t really making any money. You have probably tried various paid advertising campaigns but none of them really worked as you weren’t too sure about your target market and the best advertising medium for this audience. You are probably an expert in your products field but this does not make you an expert in online marketing. So why not outsource this aspect of your business the specialists that will sell your product for you for a commission of the sales. Imagine, hundreds of salesmen online promoting your product every day…
There are numerous intermediary sites (like Clickbank) that link vendors (like you) and affiliates in an online affiliate marketplace. In the first instance I encourage you to look at these marketplaces and browse for similar products that you sell and then identify what affiliate programs these other vendors offer affiliates such as; once off commission, tiered commission, recurring commission and what percentage of the sale is offered to the affiliate. Once you have established your commission point and have signed your product up to the marketplace then you are ready to start finding affiliates.
Whilst affiliates can search the marketplace and find your product, the most efficient way is for you to seek out affiliate marketers through forums. Once you have flagged your product, its benefits to the consumer and the benefits to the affiliate then you are ready to watch the passive income start rolling in after the affiliates start promoting your product!
Resources for starting your own affiliate army
Selling Advertising Space on your Website or Blog
There are number of different ways that you can earn a passive residual income through selling advertising space on your website or blog.
The three main ways that you can generate an income is through CPC, CPM or selling advertising space as discussed below;
Cost Per Click (CPC) is where you receive money (often cents) every time someone clicks on the advertisement link. The number of clicks is logged by a small amount of code that you put on your site and is centrally managed by an intermediary between you (website owner) and the advertiser. The most common intermediary that is used on the internet today is Google AdSense. AdSense scans the content of your website and then matches appropriate advertisements with your content to increase the likelihood that you readers will click on the link so that you receive a commission per click and the reader is directed to the advertisers page.
Cost Per Thousand (CPM) is where you receive a set fee for an advertisement banner being seen 1,000 times on your site (the M is the roman numeral for 1,000). CPM is also known as cost per impression advertisement. There are a number of intermediaries that link website owners (you) with advertisers like Amazon. Website owners often place these banner ads at the footer of their page, so as to use the prime space on the webpage for either their affiliate links, CPC advertisement, or paid banner advertisements (discussed next).
Selling Space on your site can be laborious but may often be the most lucrative form of displaying advertisements on your website. Depending on your entrepreneurial nature you may like to approach vendors that may like to advertise on your site, or install some code on your site that will make the process slightly easier. WordPress users might look at a few plugins that make this process slightly easier.
Resources for Selling Advertising Space on your Website or Blog
CPC Intermediary: Google AdSense
CPM Intermediary: Amazon
Build and Sell an App for Mobile Devices
There are number of ways that you can earn a passive residual income through your mobile app. Whilst there is a significant of time (and potentially money) required in the development stage, the payoff maybe substantial if you really hit your mark. In the interest of full disclosure, you should know that less than 1% of mobile apps are financially successful (Gartner report). However if you feel that you have a winner here are a few steps to go through on your way to your passive mobile app income.
What is the purpose of your App? It may be for entertainment or for providing a service but you need to be very clear about this. Does your App solve a particular problem for people and if so, what exists in the market already (who is your likely competition).
Who is the likely audience? Your target demographic will assist with your advertising marketing. Please note that your target audience is not everyone!
How will you market your App? This is determined by your App’s purpose and the likely audience. Have a think about what your marketing budget might be.
How much will development likely cost? To get an idea of your App’s development cost you will need to create a wire frame (GoMockingBird) of your app so you can describe it to developers and then post your mock up of your App on a freelancer site (Upwork) to receive quotes.
How will you maintain your App with patches, updates and new Android and Apple Operating Systems over time? This will likely be through the freelancing developer that you choose to use and as such should include this in your ongoing costings.
Does your App pass the friend test? Now that you have a wireframe, a quote for development and an idea of the apps target audience and purpose, the most sobering comments will likely come from your friends. If your friends think it is a brilliant idea, the true test will come from when you ask them to invest in your App!
Resources for App Development
Wireframe development: Go Mocking Bird
Peer to Peer Lending (P2P Lending)
Peer to peer lending enables you to earn a passive residual income by earning interest on money that you lend to individuals for various purposes across the globe. With P2P lending, you are the bank and people from around the world are your customers, and like a bank you profit by charging interest on loans.
This concept may sound a little daunting, however all P2P lending sites provide extensive details on the debtor, the purpose of the loan, a credit assessment of the lender and a risk assessment on the loan. Loans are categorised into different categories and high risk loans are associated with higher returns in interest to you. Lower risk loans are associated with lower interest rates and subsequently lower returns.
Whilst you might be tempted to select the higher interest paying (and higher risk) loans, I would encourage you to diversify your portfolio so that the majority of your lending is low and medium risk and only a small percentage of your portfolio is high risk. If you are new to the concept of diversification, then I encourage you to read up on this concept.
Peer to Peer lending is a longer term passive residual income idea that will require a large initial capital investment, however a limited ongoing time commitment for monitoring your loans. One of the greatest appeals of P2P lending is that customers come to you and no marketing is required.There are a number of resources available to help you navigate Peer to Peer lending if you are new to this passive residual income idea.
YouTube Explanation video (ABC)
YouTube AdSense Passive Income
A relatively new passive residual income idea is to earn an income through advertising being displayed on your YouTube videos.
Advertisers will pay for their ads to be displayed prior to or a banner on your YouTube video, such that every time someone watches your video you will receive a proportion of this advertisers costs.
If you create a lot of how to videos or have a number of subscribers to your YouTube channel then I am sure that you aware of this passive residual income source. If you are new to this concept, then I encourage you to consider a topic that you are passionate about and what potential videos that you could make that people in your niche would be interested in watching.
If you have never made a video before, it is much easier than you think. Most computers have a webcam and there are a number of free webcam video editing software applications available. It is incredibly easy to create a YouTube channel and start uploading your videos to your channel. In time people will subscribe to your channel and you will be able to notify and interact with your subscribers.
There are a number of topics that you could create videos for and I encourage you to do a search on YouTube for a topic that you are considering and have a look at the number of subscribers that already exist for similar channels as this will give you an idea of your potential target market size.
The initial investment for developing this passive income idea is small, however like blogging it will take time to build up your subscribers and you may need to invest some capital into marketing your YouTube channel.
Resources for your YouTube Passive Income
Advertising Intermediary: Google AdSense
Webcam capture software: Camtasia, CamStudio, Jing
Royalties from your Content Library
Income from royalties is not a “get rich quick” scheme, but they can make a steady passive income source and there is very little maintenance required once your content has been developed and posted. You can earn royalties from infographics, patents, artwork, photographs, icons and other intellectual property. In today’s world you can also purchase someone else’s royalties and earn a passive income from work that you did not personally develop.
How to get started
Everyone loves music of some sort, or beautiful images, or infographics. If you’re talented and are able to create a sought after form of art then having royalties as a residual income source is something that you should definitely be interested in. However if you are not creatively gifted then don’t despair, there are a number of ways that you can profit from royalties and include this stream in list of residual income sources.
The internet provides an unparalleled platform for all artists to showcase their work. Music and image ownership for instance is governed by rights of ownership or royalties. This means as an artist you can earn passive income from the music or photographs that you post online. There are a number of different sites that will display your content but be aware of their terms of commission and business models that may actually be detrimental to your income earning capacity. It is important to research each of the sites terms in your creative category and the fine print before you can consider it a residual income source option.
There are royalty auction sites such as www.royaltyexchange.com where you can place your royalties on an auction platform and let bidders buy them. To benefit from royalty auction sites, you only need to set up an account and avail information on the earnings of the music for the past one year. It is important to note that bidders will always want to purchase royalties with a long history of passive income.If you want to purchase music royalties as an investment strategy then you must beware of copyright material. Also the time of the music creation matters a lot because music created prior to 1972 may not earn you a lifetime of royalties. If indeed royalties is featured in your strategy for residual income sources then you must be extremely clinical in your decision making before making you purchase.
For passionate and talented photographers there are many online sites where you can sell the photos in your library. Sites like www.Alamy.com can give you up to a 60% royalty fee. You can also showcase your work on sites like iStock Photo, Folotia, PhotoSheleter and Can Stock Photo which have equally high royalty commission structures.
Photo royalties can still be an option for your residual income sources without a desktop or laptop computer. If you have a smartphone you can use apps like Foap, where there is a market for grading and trading photos. The best news about trading your photos on online apps is that they can earn you money several times over because the photo remains in the market even after several purchases.
What’s the secret to succeeding with royalty sales?
Generating and income from royalties from your content library is not a get rich quick scheme, but like any other business, with time and commitment you will be able to generate a monthly passive income source.
Buy an Existing Residual Income Business
Passive income ventures by their nature are designed to be low maintenance businesses once they are established. In the past, most passive income businesses had to be cultivated from scratch with a lot of good old fashion hard work. This is no longer the case and it is possible to buy pre-fabricated passive income businesses with quantified streams of income.
What type of passive income business should I buy?
The most important things when purchasing a passive income stream is determine how the income is generated, how much ongoing effort is required by you, and the income that is generated each month. Some passive income streams like investing in real estate property and renting them, or purchasing a taxi and having someone operate it are residual income investments ideas that can be extremely costly upfront. If you have a lot of upfront capital then online sites like www.businessforsale.com will give you several options of passive income businesses you can invest in.
If on the other hand you have limited start up capital or just want an online residual business then you have several passive income stream options. You can purchase blogs or developed websites from sites like www.flippa.com. You can also buy royalties for songs or photos which are still earning royalties and will continue to earn royalties for a long time. You can actually purchase the royalties for numerous artistic endeavours on sites like www.royaltyexchange.com which can continue earning you money for years. You can also buy e-courses that have already been developed and sell them on sites like www.digitalchalk.com.
Criteria for evaluating the best residual income investment ideas
Like every other business, it’s important that you are familiar with the niche market for the residual income investment ideas that are under consideration. It would be difficult to write a blog about Australia if you had never been there before. If you purchase a blog only looking at the number of visitors, you may be frustrated when it doesn’t start making you money immediately. You can also not buy a developed course when you’re not knowledgeable of the different markets you can sell your content on. If you have an understanding of the residual income investment idea that you’re undertaking, then you’ll be in a better position to improve or market it.
A residual business stream should be one that can make you money immediately or almost immediately. If it’s a blog or a website it should be one that you can start immediately start selling advertising space or earn a commission through affiliate links. Websites like www.clickbank.com offer opportunities for blogs to participate in affiliate marketing but there are certain factors they look at for the blog to be considered such as the relevance of the content.
It is important to know the worth of the business that you want to buy. If you would like to purchase an out of the box passive income business then start small and learn from your experiences. A good residual business should be one that is already making the owner money, because let’s be truthful, the reason why you’re buying an already set-up business. Whilst huge numbers of page views and visitors to a site may sound fantastic, it is really the sales or conversions that you are interested in.
Create and Sell Your Online Course
Did you know that there is someone somewhere who wants to know some of the things you do and are willing to pay premium for a guide or course on how to do it. An eCourse business is a passive residual income stream that can be tapped by anyone. You don’t need to be a professor in order to share basic how to guides to people. Whatever your passion is, you can create an online course and make money from selling the course.There are several avenues for creating and hosting your personal online course. There are singular online course platforms that only focus on entrepreneurs with specific subject matter. These sites have different categories and will give you strong support, tips on how to deliver educational content and also support material to get you started. Most of the standalone platforms are however paid although they will offer you a small trial period. Subscribe to the paid packages only after you are convinced that the site will be handy in helping you reach your goals. Some of the popular standalone sites include; Teachable, DigitalChalk, Educadium, Thinkific, Udemy and Zippy Courses among others.
If you’re not so sure which course you want to start selling then you can check out all in one websites. These websites offer passive residual income opportunities to beginners and intermediates. They don’t just give you the training for creating the courses; they also help you manage your online presence. These sites incorporate both elements of customer and marketing relationship management tools (CRM) with web content management system (CMS). Some popular all-in-one platforms for course creation training and selling your courses include Rainmaker and Academy of Mine. There are also marketplace online course platforms only for selling your courses. These include Coggno, OpenSesame and ProProfs among others.
What eCourse Topics are People Interested in Learning About?
When creating an online course, it’s important to know the current trends in what people are looking to learn. When you know the trending topics it’s easier to customise your content to meet customers needs. It’s also important that you undertake sufficient research to ensure that your course content is relevant and accurate. The internet is full or information about topics that are currently selling.
Sites like Teachable, Thinkific and Zippy Courses will help you choose the right topic, develop a concept for the course, and create the course. Afterwards, they will also help you in selling the online courses.
What content should you put in your eCourse?
A common question that arises when people enquire about selling e-courses as a residual income source is, what do I include in the online course? With the vast amount of information available it is possible to include an incredible amount of content on any subject matter. People have different needs and subsequently it may be prudent to break your course up into stages such as beginner, intermediate and advanced. You can sell small course packages with only basic information at a cheap price, a more intense course volume at a higher price and finally a professional course for those ready to spend high premiums. Within the online course you may also decide to add informative interviews with experts in the same field, short tutorials, audio files for those individuals who like podcasts, small eBooks that supplement the lessons, checklists for completing the tasks you have put up in the videos and you can also add videos to spice up the lessons.
Multi Level Marketing
Multi-level marketing (MLM) is a strategy where in addition to profits made by direct sales, profits are also made from the sales generated by salespeople that have been recruited. The recruited sales force is often called a down-line and participants are remunerated according to the level or tier within which they fall.Although network marketing or MLM is largely promoted as an opportunity for anyone to create a passive residual income, MLM is often not what it is hyped up to be. If MLM is one of the residual income investment ideas that you’re considering, then it’s necessary that you understand how a MLM operates and then determine is appropriateness for you. I recently watched the documentary ‘Betting on Zero’ which provided some really interesting insights into the workings of MLM businesses. I have included the movie trailer below and if you are considering an MLM business as a residual income investment idea then I strongly recommend that you watch this documentary.
Within MLM circles It’s not uncommon to hear network marketers talking about becoming millionaires without working hard, getting rich super-fast and retiring on a beach whilst the down-line does all the work. With MLM it is in fact the exception to the rule if you are part of the small elite that reap the millionaire lifestyle.
Multi-level marketers are also trained to sell opportunities instead of selling the products. Most people who join multi-level marketing are only allured by the promise of getting rich, and very rarely by the products which are often over-priced to factor in multi-level commissions. Any business strategy that does focus on product quality and price will eventually flop.The inherent design of MLM schemes means that only people high up in the MLM organisation really profit from the business and this is what results in the overall disadvantage to new people joining a MLM business. It’s really not that you can’t make profit with the MLM strategy, the problem is that MLM businesses are designed to ignore the saturation point, which eventually leads to a collapse due to no more recruits joining the scheme.
The Allure of Product Discounts
MLM products and services are often promoted by providing large discounts. The problem is that the discounts that are given are not aligned to customer needs. When a MLM product (with discount) is compared to a similar product on the market, it will still likely fall short of being close the market price of the alternative product.
MLM schemes must recruit new people or they will fail
A number of MLM companies have been largely criticised (and in some instances sued) because they have focused on recruiting lower-tiered sales people (instead of focusing on actual sales) with misleading information, price-fixing, and high initial start-up costs for new recruits. MLMs have also been associated with exaggerated compensation schemes, cult-like techniques and the exploitation of individuals.
Buy an Investment Property
Among the most talked about residual income investment ideas is real estate investment. Indeed, investment in property and land has for centuries made lots of people truly wealthy. Investing in real estate is a tried and true passive income and wealth generation tool that is still being employed by individuals, companies, organisations and governments all over the world each and every day.
Why is property investment a passive income investment source?
Passive income is defined as income that you can receive on a regular basis but that requires little or no maintenance actions from you. Passive income businesses require little ongoing participation in the management of your investments or businesses, however you will enjoy a residual monthly income.
There are two main ways that are usually considered means of a passive income source by property investors. The first way is purchasing property and then renovating and remodelling and putting it back to the market. This is known as property flipping. In reality, this is a pseudo passive income investment through the fact that you’ll have to put in a lot of work and also money in the renovation process.
The second means by which purchasing property can act as a passive income source is to rent out the property. This is the most common definition of having a property investment as a passive income source because the ongoing management will require a small amount of your time for tenant and property management, however you may choose to outsource this to a property manager.
How much passive income can I earn from real estate investment?
Naturally the amount of passive income that you can earn from real estate investment (read rental property) is related to the amount of properties that you own. So if this is among the residual income investment ideas that you have decided to try then you must dedicate yourself to investing in a property purchase. The best way to get high profits is usually to invest in ready-to-rent properties.
It’s also a good idea to get a property that is managed by a property management company which will free you from handling any administrative tasks like paying for maintenance and repairs, confirming tenant documents or collecting rent. Selecting a property that is positively geared is ideal, which means that the rent collected is more than the amount paid for property management services, repairs and maintenance, insurance, tax and mortgages.
What is capital growth? What is rental yield?
Capital growth or capital appreciation is the positive increase in the value of a real estate property after a period of time. Capital growth is therefore the difference between the market value of an investment or property after a period of time and the original cost of purchase. The rate of capital growth for any investment property will depend on the type of property and its location. There are areas where real estate will steadily increase over a period of time and areas that experience a slow growth in the appreciation of assets.
Rental yield on the other hand is the total amount that an asset produces on a yearly basis based on the value of the property. There are two types of rental yield; gross yield which is calculated by subtracting all expenses form the annual rent then dividing by the value (purchase price) of the property and multiplying by 100. The other is the net yield which is the total amount of rent from the property on a yearly basis divided by the purchase price of the property, multiplied by 100.
How do I find properties with high capital growth and high rental yield?
Finding a property with high capital growth and high rental yield requires an in-depth knowledge of the property market. There are a number of property management companies and real estate agents (read buyers advocates) that can help you identify properties with high capital growth and high rental yields.
Where can I get more information on real estate investment in Australia
Investing in Shares
Numerous individuals employ share trading as one of the many residual income investment ideas in their passive income portfolio. In business terms, a share is a unit of ownership in a financial asset or corporation that enable the business owners to share in profits that have been declared in terms of dividends.
For both types of shares, you may choose to purchase the shares as a short term investment or a long term investment. Generally speaking, a short term investment strategy aims to profit from the difference between the purchase price and the sale price of the shares. A long term strategy aims to profit from both the difference in purchase and sale price, and also profit from dividends that are paid throughout the year.
Are different shares riskier than others?
Shares, like other residual income investments ideas comes with their unique risk factors. There are two types of shares that companies give; preferred shares and common shares. Common shares are usually more popular with companies and shareholders will usually benefit through dividends and appreciation. They have the advantage of giving the shareholder greater control over the business since shareholders have voting rights. Common shareholders also have the right to purchase new shares when the company issues new shares or just retain their current percentage of ownership.
Preferred shares have an established criterion for payment, where dividends are paid on a regular basis. You may be able to redeem your preferred stock at a greater profit because preferred shareholders are most often given a higher priority over common stock shareholders.
The profile of the company and the sector that it operates will also have an impact on the risk profile of the share. Companies that have a high net worth, have been established for a long time and are in a lower risk sector like finance will have a lower risk profile than companies that are less established and in high risk sectors like mining. Lower risk profile companies are often referred to as blue chip companies.
What are dividends and how much do they vary by company?
Dividends are cash payments made by dividend paying companies to it’s shareholders. In simpler terms, a dividend is part of the profits that the company has accrued over a period of time which is distributed among the company owners or shareholders.
Most dividend-paying companies distribute their dividends on a quarterly basis. The payout dates and the dividend amounts (dividend policy) are usually decided by a company’s board of directors. Although every company will set its own dividend calendar, and as an investor there are certain dates in the dividend calendar that you must be aware of. The first common date for dividends is the dividend declaration date. This is when the company officially announces when it will pay out the next dividend. The dividend record is the date when you’re expected to record that you’re the shareholder of said dividend.
The Ex-dividend date is the date when you can determine your eligibility for dividends. Usually stock transactions will settle after two business days and this is therefore the period to follow up with your dividends.
Dividend payments vary by companies due to the different approaches that companies take in dividend payments. Companies know that most people consider shares for their residual income investments ideas and subsequently try to offer high dividend payments to encourage shareholder recruitment and retention.
How do I buy shares? And how much will it cost?
The cheapest and easiest way to purchase shares is from online share dealing platform. From these platforms you can purchase shares from companies in your country listed on the stock exchange and you can also purchase shares from overseas companies. There are numerous share brokers to choose from, with each broker offering varying levels of service and commission charges.
You can either purchase shares for yourself or pull money together with others in a fund investment and purchase the shares as a group. The latter option is commonly referred to as a managed fund.
Is share trading a good residual income investment idea?
To answer this question, a good example of a share trader is Warren Buffet, who is an American share investor who is rated as the 3rd richest person in the world. He made his fortune from share purchases, having bought his first shares at just 11 years old. Buffet started his career working as a stock broker and made several partnerships before directly venturing into investing into businesses using his value investing knowledge to find good bargains in the stock market.
Renting out your Car Space
If you live in major city then chances are car parking spaces are a highly sought after commodity. If you have a spare car space at your unit complex or you have some space on your front lawn at your house then you will be amazed at how much people are willing to pay per month to park their car at your place.
There are numerous sites in each country across the world that link people with space with car owners and it is easy to get a quote from these sites about how much your space is worth. When you are comparing sites, ensure that you understand the fee structure as the fees may significantly cut into your passive income.
Resources for Renting out your Car Space
Renting out your Car
If you are going on holidays for an extended period of time or you don’t need to use your current car, then you might like to consider renting it out temporarily. The rate of return that you will get from renting your car out depends on a number of factors such as the type of vehicle you have and the demand in your area.
Depending on the country that you are renting your car out from, there will likely be additional insurance that you will need to take out. Make sure that you read through the fine print on the site and ensure that your asset is covered in the event of an accident. Also consider the fees that are associated with using the intermediary site and compare sites to ensure that you are maximising your passive income from renting your asset.
Resources for Renting out your Car
Contract For Difference (CFDs)
CFDs differ to conventional share buying through the ability to sell or short a position. CFDs cover a wide array of instruments including currencies (eg. EURUSD), shares (certain companies), commodities (eg. Gold) and indexes (eg. S&P 500). A contract for difference allows traders to invest into an instrument (like currencies) without actually owning the asset. The CFD is a contract between two parties (the buyer and the seller).
To explain CFDs, let’s use a commodity example and say that you buy Gold using a CFD. You will never physically own the amount of gold that you bought, however you have entered into a contract with another person (usually a large financial institution) whereby you are speculating that the price of gold will go up. This zero-sum contract means that for every dollar that you make on the trade, the individual that you have the contract with will lose one dollar. CFDs also enable investors to utilise high rates of leverage, meaning that it is possible to make (or lose) that dollar more quickly with smaller market moves.
Profit from whether the market is moving up or down
CFDs also enable investors to speculate on whether the market is moving up or down. This means that It is possible to make money from trading regardless of whether the market is moving up or down by either entering into a buy contract (speculating that market will move up) or a sell contract (speculating that the market will move down). This obviously differs from share trading, as if the stock that you have invested in starts to decrease in the price per share, then you are in effect losing money when you try to sell that stock at a reduced price (in comparison to what you bought it for). If you would like to gain a better understanding of selling (or shorting) the market then I recommend that you watch the 2015 Brad Pitt movie, The Big Short.
Using a CFD currency trading example, it is possible to speculate that the price of a currency pair will increase hence you would ‘go long’ and enter into a ‘buy’ position. By ‘going long’ you are in effect buying an amount of a currency pair (eg. EURUSD) at today’s price in the hope that tomorrow it will be greater, so that you can sell it on at a profit in the future (which may be seconds, minutes, hours or days).
Continuing with the CFD currency trading example, It is also possible to speculate that the price of a currency pair will decrease hence you would ‘go short’ and enter into a ‘sell’ position. This is where you’ve sold an amount of a currency pair (eg. EURUSD) at today’s price (that you never owned in the first place but borrowed from your broker). When you want to close the trade, you simply ‘buy’ the amount back of the currency pair that you sold (eg. EURUSD) and settle the difference with your broker. If the market moved lower, then you have made a profit. If you decided to go with a ‘sell’ order and the market moved higher than you would have made a loss.
What is Leverage?
The leverage, or margin trading ratios, can be as high as 1:500 in CFD trading, meaning that a margin deposit of $1,000 could control a position size of $500,000.
If we use an example of buying the EURUSD (currency pair) at a price of 1.25680 with our $1,000 at a leverage of 1:100 how much money do we stand to make or lose?
IF: the market moved up and we sold our position at 1.25980 how much money have we made?
Profit/Loss = (Sell price – Buy Price) x Position Size (determined by lot size)
= (1.25980 – 1.25680) x $100,000
= (30 pips) x $100,000
= $300 profit
IF: the market moved down and we sold our position at 1.25380 how much money have we lost?
Profit/Loss = (Sell price – Buy Price) x Position Size (determined by lot size)
= (1.25380 – 1.25680) x $100,000
= (-30 pips) x $100,000
= $300 loss
As you can see, this is why leverage is considered a double edged sword. It is great when the market is moving with you, but not so great when the market is moving against you.
Is CFD trading risky?
CFD trading involves a number of risks, such as market fluctuations, economic changes and market risk. CFDs are volatile, speculative, and high risk instruments. An Investor should consider their investment objective and risk tolerance and expenses associated with investing. You must be aware of the risks and be willing to accept them in order to invest in CFDs, making your own investment decisions regarding time, place, buying, selling, entering and exiting trades you enter into made by yourself. Fluctuating CFD rates will impact your investment and hence your CFD will therefore increase or decrease in value where losses can exceed your initial deposit. This may not be suitable for all investors and it is recommended that you seek independent advice to ensure you fully understand the risks involved before investing in CFDs
How can I start trading CFDs?
Before you start trading with real money it is possible to start trading in a demo account so that you can test your trading strategy in real time and also become familiar with the trading software that you are using. I prefer to use Pepperstone as they provide many platforms for trading, have different account types (spread and commission charging), are regulated in a number of countries (including Australia – ASIC), and offer the major CFDs that are traded globally that include; Gold, Silver, major currency pairs and major indexes. Open a demo account with Pepperstone for free by using this link.
Car pooling is an incentive program that aims at encouraging vehicle owners who drive to work to make money by utilising the extra seats on their car. Car pooling not only acts a income source and a way to offset the costs of your transportation, it also encourages interactions and networking between people. You wont become a millionaire by any stretch of the imagination, but will be able to offset the costs of your own travel. Income from car pooling is considered a passive income source, as you do not have to actively work for it if the travel is already part of your daily routine.
If you are interested in finding out more about offsetting your travel costs through car pooling, simply register with the car pooling community in your area with sites like Waze car pool, Uber Pool or Lyft line. These sites will help connect with other commuters who are heading in your direction.
Most of the sites, like UberPool, have a mobile App from where you simply upload your profile.
If you don’t want to use a third party tool, then you can also recruit your own passengers by designing a flyer indicating that you’re car pooling, or posting a note on a community notice board or a local facebook group.
The Best Car Pooling Sites to Join
The best part about setting up a car pooling ‘business’ is that you don’t have to do the hard work of looking for riders. One of the suggestions that popular search engines will give you when you search ‘how to make a passive residual income’ through car pooling is to use car pool community websites. Such websites will easily match you up with riders in your area who go to a similar direction with you.
With the amount of traffic increasing in major cities, most people are opting for car pooling services both as a way for saving time and saving money. Car pool websites and Aps like Waze Carpool, Lyft Line and UberPool make car pooling easier for both riders and drivers.
Setting Up a Car Pool Profile on Car Pooling Apps
Setting up your car pooling profile on any car pool community site is easy. You simply download a car pool App for example Lyft Line and then go to new user setting. In the example for Lyft app the setting is found on the tab ‘Line’. The app will match you with a rider going in the same direction and you get to fix the price for the ride up front.
The benefits from car pooling
Driver: Commuters will pay an upfront fee through the car pool website and the money will then be transferred to you. Usually the site will also take a cut for site maintenance, but this is a small amount of money compared to not making any money at all with the extra spare seats in your car.
Commuters: if you use car pool services as a commuter, you get to save up to 50% or more from the amount you would have used as fare or for fuelling your car. You will also be able to work whilst you are in the car on your phone or alternatively network with your fellow commuters.
Environment: By potentially reducing the number of vehicles on the road, there will be a subsequent reduction in vehicle emissions.
Signal trading is known by many names including; copy trading, social trading signals, FOREX signals, Percent Allocation Management Module (PAMM), mirror trading and social trading.
Signal Trading is a combination of social networking, forex trading and portfolio management that can be likened to trading managed funds. Investors can choose to follow one or more traders based on a number of factors. Investors constantly monitor and evaluate the performance of traders and if trader performance falls below expectations then the investor can stop following the trader and invest in another trader.
There are a number of concepts that govern signal trading including; market factors, risk mitigation, system automation, signal trading platforms, differentiation of signal traders, and how to evaluate and monitor signal trader performance. In order to understand signal trading you must first understand the basic principles of FOREX trading.
What is Foreign Exchange (FOREX) trading?
When an individual trades currencies (ie. buys one currency and sells another) it is called currency exchange trading or simply known as FOREX trading. The value of currencies fluctuate on a millisecond basis, providing traders with limitless possibilities for price speculation and profiteering and/or losses!
FOREX trading is a zero sum situation in which one person’s gain is equivalent to another’s loss, so the net change in wealth or benefit is zero. This means that for every dollar that you make in the FOREX market, someone (often a large financial institution) is losing.
FOREX is the world’s largest market and it is estimated that each day, there is greater than $3.2 Trillion traded. There are many pros and cons to the FOREX market that include but are not limited to;
- It is possible to make profits regardless of whether the market is moving up or down
- FOREX markets are open 24 hours a day during the business week
- FOREX markets trend
- It is possible to leverage your position up to 1:500 (ie. for every $1 you trade, you can control $500).
- The FOREX market is one of the most liquid in the world meaning that is almost always possible to open or close a position immediately
- The FOREX market can be highly volatile
- It is possible to trade a only a few hours a week
- It is possible to automate your trading strategy
- You can trade from anywhere in the World with an internet connection on a smart phone, tablet, laptop or desktop computer
- You can practice trading with a Demo account with no risk to your capital
What is Signal Trading?
Signal trading can be thought of as a FOREX managed fund that enables the investor (you) to allocate a proportion of total capital to different traders (signal providers) such that orders in the market that the signal provider executes is mimicked in your account. Another way to explain this is to use the analogy of playing blackjack at the casino. You can either sit at the blackjack table and play yourself, making your own money management, risk and card strategy decisions or piggy back (back betting) on a player that is playing really well, such that you mimic their bets but do not make any decisions around money management, risk and card strategy.
So continuing with the blackjack analogy, there are numerous casinos that offer platforms for players and back betters to speculate. If you have ever been to Vegas, I am sure that you have stumbled pass a few blackjack tables, and like casinos, FOREX signal trading platforms offer different attractions, incentives, loyalty programs and commission structures. And like all Casinos, different players are attracted for different reasons and these motivations will help us to examine the differences in FOREX signal trading platforms and FOREX signal providers.
The diagram below explains the relationship between the investor (you), the FOREX broker, the signal provider (trader) and select FOREX signal trading platforms. As you can see from the diagram it is possible for the trader to profit from providing a signal in various ways, which impacts on the trading style of the trader which may be a good thing or a bad thing for the investor.
What does a good signal trader look like?
A trader’s performance is determined on every trade that they make and they are most commonly assessed on their account growth over time, however a much less advertised factor is the account drawdown over the life of the account.
Drawdown is an interesting measure as it is not uniformly measured and quoted across signal trading platforms. I prefer drawdown measured as; the most amount of an account that was committed in the market (equity) divided by the account balance at that time, expressed as a percentage. This measure will tell me what was the most amount of risk that the trader endured over the life of the account.
Is Signal Trading risky?
Signal trading involves a number of risks, such as currency fluctuation, economic changes and market risk. Currencies are volatile, speculative, and high risk instruments. An Investor should consider their investment objective and risk tolerance and expenses associated with investing. You must be aware of the risks and be willing to accept them in order to invest in the foreign exchange market making your own investment decisions regarding time, place, buying, selling, entering and exiting trades you enter into made by yourself. Fluctuating foreign currency rates will impact your investment therefore increase or decrease in value where losses can exceed your initial deposit and may not be suitable for all investors hence it is therefore recommend that you seek independent advice to ensure you fully understand the risks involved before making your own investment decisions.
How can I start investing in Signal Trading?
Before you start trading with real money it is possible to setup a demo account so that you can test different signal providers in real time. You will also need to select an online broker that allows signal trading. I prefer to use Pepperstone as they provide many platforms for trading, have different account types (spread and commission charging), are regulated in a number of countries, and allow you to link your accounts to many different signal trading platforms. Open a demo account with Pepperstone for free by using this link.
I have also broken down the other steps to get you started with FOREX Signal Trading below and encourage you to examine the pros and cons of different social trading platforms before selecting a specific one to use.
The most common limiting factor for people achieving their entrepreneurship dream is finance capital. In fact, most people confess that if they had some source of funding they would start up a business. What you may not have known up to now is that you can actually start up a business without any start-up capital through angel investing.
Angel investors are people from all backgrounds who are passionate about helping the next generation entrepreneurs start off. If you’re familiar with TV entrepreneurship shows like “Shark Tank” or “Dragons Den" then you already have an understanding of how angel investing works.
Angel investors come from a diverse background including lawyers, designers, tech specialists, and even seasoned entrepreneurs. The only thing they want from you is a small cut in your business but are willing to put up to 100% of the capital investment.
How does Angel Investment Work?
Angel investors can be categorised into four main groups; friends and family, individual angel investors, angel investor networks and fund raising investors. You can choose to be an angel investor, investing your capital in a business idea to generate a residual income, or as the recipient of angel investment to invest into your own passive residual income idea.
Friends and Family as Angel Investors
Getting business capital to start up a business as a residual income source can sometimes lead you to turn to friends and family. The main advantage of using this route is that people close to you will always know your talents and passion and may be able to advice you appropriately. They will also give you their honest opinion on businesses that they consider risky investments and may help you come up with alternatives. The disadvantage of having friends and family as your angel investors however is that mixing personal relationships and business may be challenging. And you may be forced to make some decisions simply from the pressure of having loved ones investing in your business.
Angel Investor Networks
Are professional networks that connect angel investors to potential entrepreneurs. Most of the networks are run online and this makes it possible for investors who want to keep their anonymity to be able to participate. Angel investor networks will normally do screening for potential investors and entrepreneurs. The investors, anonymous or not, have a team of managers that set investment targets and follow up on profitable investment opportunities. Angel investor networks also have the advantage of lettings angels’ pool up capital for certain ventures. So sometimes you may be lucky if an investment idea you were thinking of as a residual income source gets the attention of a couple of investors and they all decide to pour in money for a share in your business. Getting an angel investor from an angel investment network will give you the advantage of profiling potential investors so that you can pitch your idea and don’t have to call individual investors but only those that have shown interest. Example of large angel investor networks in include the Australian Investment Network and Cornerstone Angels.
Individual Angel Investors
This is perhaps the hardest means of finding an angel investor. There are two major challenges using this route to find investment for a residual income source business. The first challenge is that most individual angel investors are away from the public limelight and even when you get to know them, for the ones with offices, they will only be investing in business entrepreneurs that require millions. The second reason is that these investors don’t know you so they may be apprehensive in supporting you.
A good tip for finding a potential individual investor however is to get to know them through network connections. If you know someone who is friends or relatives with a potential angel investor in your industry and business model, then you could approach them with your idea and ask them to do the introduction for you.
Microfinance Investment as an alternative
Non-profit microfinance sites like Kiva and Thrive also give you an opportunity to start up a residual income source business if you are from a disadvantaged background. These sites have support from sponsors and grants as well as donations which enable them to be able to financially support entrepreneurs with limited access to finance. Another advantage of getting funding from these micro-finance groups is that they will offer free financial education and also motivate you to succeed in order for you to give back to the community.
Off-line Passive Income Businesses
In most cases coming up with the right business idea, online or offline, is more difficult than even finding the start-up capital and rolling out the business. The problem is not as much the lack of business ideas as it is evaluating which idea is best for you in your current situation.
How to evaluate a good offline passive income businesses
In order to find a consistent passive income streams, most people will try several online and offline passive income businesses. The following are tips that can help you to quickly assess the offline business ideas that are worth pursuing.
if you already have a stable regular job, and you want to venture into a passive income businesses that won’t take up a lot of capital, you can purchase an already established business or can use a small part of your saving as capital. If you lack significant capital then you may like to consider targeting angel investors.
Have the future in mind
It’s never wise to start up a business that you don’t see a future with. The idea of starting small, or starting at all, is to be able to have a ‘full blown’ venture in the future.
When evaluating good offline residual businesses, it wise to pursue ventures that have the potential for profits early on this business.
Passion and expertise
The offline business ideas that mostly get to become big are those started by people who were either very passionate about the venture or have expert skills in the field. If you’re passionate about the field of trade but don’t have the skills then evaluate if you have the time to undertake further training, or consider outsourcing the tasks that you are not comfortable doing.
Top 3 Ideas off-line residual businesses
In the recent past, there are three off-line residual businesses that have gained a lot of popularity. These businesses include; Automated Car Wash, Laundromat and Vending Machine businesses.
Automated Car Wash Business
The start up capital required for an automated car wash business may be a deterrent for exploring this passive income business, however the potential residual monthly income may offset this business development factor. If you choose the perfect spot for your auto car wash business, and dedicate enough time to running the business then this offline residual business may become a significant passive income source.
Vending Machine Business
Starting a vending machine business does not demand a lot of venture capital and it requires a minimal amount of cash for maintenance. The most important considerations for this business is the location of your vending machines and to ensure that they are stocked appropriately. Favourable spots for setting up vending machines are in store fronts and near lunch rooms.
Setting up a coin operated laundry business will require significant start up capital, however the ongoing passive income will in time be able to pay down the initial capital used. Start up costs include equipment purchases, marketing, and ongoing maintenance.
Where can you purchase an off-line business?
The best way to reduce on the capital costs for starting an offline residual business is to purchase second hand equipment. This will help you make savings and you can use the second hand equipment to make money for purchasing brand new equipment and expanding the business.
You can easily purchase an offline business from the internet. If you’re in Australia, popular sites like Businessforsale, Anybusiness or Gumtree have multiple entrepreneurs looking to sell offline businesses.