How entrepreneur Mikey Moran built his beauty supply business into a multi-million dollar business and credits smart card usage for part of his success.
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“I became obsessed about the quality and type of products,” he says. “So many women are passionate about hair, and many also want to sell something and earn money. We make it easy to get into the business by supplying them with great products and designing their logos and websites.” Private Label Extensions took off. The first year it did $220,000 in sales; in 2017, it was $4.2 million. If all goes according to plan, the company will hit $10 million in revenue in 2018.
How did credit cards factor into your company’s start and growth?
Credit cards have been an enormous help to our exploding business in the beauty industry! With the right cards, any business owner can capitalize on purchase security, rewards and accounting organization.
They also help with cash flow. The credit line is a good buffer if you ever run low. Every couple of days I pay off our bills completely, but maybe one day I will need the full grace period. It’s good to know I have that option, just in case.
Which cards do you use and why?
We have a few. The Business Gold Rewards Card from American Express is great for social media advertising, as it yields triple rewards. The Platinum Delta SkyMiles® Business Credit Card from American Express allows us to earn Medallion Qualification Miles, so that helped us get to a Delta Medallion level fast. Once you get to a certain amount of spending with American Express, you are assigned a dedicated account manager. They can review your account and make sure you are maximizing all the benefits the cards are offering.
The Capital One Spark Miles for Business card is one of my favorites, as it allows us to earn double rewards on all purchases. There is a simple point hack with the Spark card – when you book a Delta flight with Capital One points, you still earn the SkyMiles. It’s a great way to quickly get more free travel!
Any tips for business owners who are just starting out?
I didn’t know enough about business credit cards in the beginning, so I didn’t apply for them, and that was a mistake. Build your relationships with credit card companies as soon as possible, when you don’t need them. It’s a lot easier and less stressful that way. You may be using your personal credit cards in the beginning, most likely, so delete debt, pay off any accounts in collections and build up your credit score. You want them to see you are a valuable client.
And don’t overdo charges! When we got our first AmEx business card, I spent over $80,000 on product in three weeks to get the most rewards points. As a result, AmEx thought we were a high risk, so AmEx cut us off! I would have gone slower had I known that could happen. Remember, credit card companies don’t know who you are, and trust takes time.
How do you use the rewards you’ve earned?
Because we spend so much on cards, we earn over 500,000 points a month. We are very frugal, though, and are still trying to grow the business fast, so I mainly use the rewards for business travel. We go overseas often, to China and India, to meet with suppliers. Being able to get an airline upgrade is really nice when you’re going that far.
We have 18 employees, so I do things for them with the rewards. I was just in Barcelona and loved the city so much that I wanted to share my experience. So, for Christmas this year, we will have a raffle and one lucky person will win a vacation for two in Barcelona. It will include the flight and nine days in a beautiful hotel – all paid for with the points from our business cards!