Have you ever seen a car, truck, or van in your area wrapped in an advertisement? If so, you may have wondered whether these advertisements — known as vehicle wraps — are a worthwhile investment get your small business off the ground or propell it forward.
Below, you’ll find a complete breakdown of what vehicle wraps are and whether you should consider investing in them.
What is a car wrap?
A vehicle wrap is a digitally-printed mobile billboard. Professionals will work with you to craft your advertisement and then print it on vinyl. Professionals print vinyl wraps in full color with eye-catching graphics. After using graphic design software to design your wrap, the individual will then apply the vinyl film to your car.
You can select either a full wrap, which covers the entire vehicle including the windows, or a partial wrap. Even if the wraps cover windows, you won’t have a problem looking through them. A high-quality vinyl wrap typically lasts three to five years.
Are vehicle wraps effective?
When you think of marketing techniques, the use of vehicle graphics may not be the first thing that comes to mind. However, you may want to give car wrapping more consideration based on the following statistics:
- In the US today, “individual vehicle advertising generates between 30,000-70,000 daily vehicular impressions,” according to ARD Ventures.
- “Mobile advertising generates 2.5 times more attention than a static billboard,” says Perception Research.
- “Messages on outdoor mobile billboards have a 97% recall rate,” RYP & Becker Group
Based on these metrics, it’s easy to see why small business owners would want to consider choosing vehicle wraps over more traditional forms of advertising.
Aren’t wraps meant for large companies with vehicle fleets?
There is a common misconception that vinyl car wraps are only for companies with large vehicle fleets. However, this is not the case. Even if you don’t own company vehicles, you can still rent a truck or van to advertise your company’s information.
There are now companies that take advantage of the gig economy to provide wrap advertising services. For instance, sites such as Wrapify allow drivers to earn money by wrapping their cars on behalf of third-party companies, like yours.
Taking advantage of these mobile advertisements could legitimize your small business and introduce your brand and logo to customers in your area. When small business owners use vehicle wraps, it puts them on the same playing field as companies large enough to maintain vehicle fleets.
How much do car wraps cost?
The cost of vinyl wraps depends on the size of the vehicle you wish to cover. You can wrap cars of any size. The average cost typically ranges from $1,500 to $3,000, which includes:
- Vinyl graphics design
- Printing services
- Professional installation
Another thing to consider is the cost you’ll save on not having to repaint the vehicles in your fleet. Vinyl wraps are a cost-effective solution compared to the price of a new paint job. Vehicle wraps also provide paint protection for your car, truck, or van. The wraps give the vehicle a new look, while preserving the original paint job.
If you were to paint ads on your vehicle, you would be stuck with the same advertisement until you decided to repaint the car. However, with custom vehicle wraps, you can change ads as you wish. If you don’t want to have an advertisement on your car any longer, you can have a professional remove the wrap without causing any damage to the original paint.
How do vehicle wraps compare to other forms of advertising?
The Outdoor Advertising Association of America classifies wrap advertising as a form of “out of home ” advertising. The agency says that vehicle advertising can be the most effective and efficient form of out of home advertising, reaching more consumers at a lower cost per thousand impressions than any other form of advertising.
On average, wrap advertising costs as little as four cents per thousand impressions. This is significantly lower than other forms of advertising. For instance, it’s estimated that outdoor signs cost $3.56 and newspaper ads cost $19.70 per thousand impressions. Wrap advertising isn’t quite as cost-efficient as online advertising, but it’s certainly more effective than some other forms of marketing.
Vinyl wraps tend to increase the outreach of a marketing campaign. When conducting traditional marketing campaigns, small business owners often limit themselves to a small demographic . For instance, if you advertise in the Wall Street Journal, you’re limiting yourself to those who are, on average, 30-49 years old. However, if you engage in a mobile billboard advertising campaign, you’ll reach everyone from children to seniors.a
What is the average return on investment for vehicle wraps?
There is no average return on investment (ROI) for vehicle wraps because it will depend on the type of company you have, where and when the vehicle is driven, and the effectiveness of the wrap design. But there are ways you can measure your return.
- First, you can provide a separate phone number, such as an 800 number, that is only advertised on the wraps. Then keep track of the calls that come in through it.
- Next, advertise a special discount or deal only on the wrapped vehicle and keep track of those calls.
- Finally, you can create a landing page for your website and put that URL on the wrap. (Be sure to keep it simple so potential customers can remember it.)
Todd Stuart, President of SignZoo.com , told us, “We hear stories from customers on a daily basis about how their business increased after wrapping their vehicles. Some tell us that they gained new customers before they even got home with their newly wrapped car, while others literally took an order as soon as they left our offices. One of our customers tracks his job leads and says his sales shot up from $42,000 to $219,000 in 10 months due to his wrapped trucks.”
So, although there is no across-the-board ROI figure for wraps, there are ways for you to measure the effectiveness of your ad campaign.a
Do you need to have advertisements on car wraps?
In addition to custom vehicle wraps that advertise your business, some other types of vinyl could be useful for small business owners. These wraps don’t necessarily need to have any advertisements on them. Instead, they could protect your company cars, especially if you expect to put a lot of wear-and-tear on them.
For instance, some people use vinyl wraps as a paint protection film so that the original paint on the car doesn’t chip or peel. Paint protection vinyl is clear, providing your vehicle with a secondary layer to help keep your paint safe.
You could also choose to utilize color change wraps. These are a cost-effective solution that allows you to change the color of your car without having to invest in a new paint job. There are numerous colors and finishes available, including high gloss or matte finishes. Studies have shown that using color psychology could give your company a competitive advantage.
A word of caution
Because printing technology is better than ever, wrap installations are more accessible than ever. However, there has also been a rise in inexperienced people setting up fleet wrap shops. It’s a good idea to check a wrap provider’s credentials and reviews before engaging in business.
Wraps shouldn’t damage a vehicle’s paint job. However, if an inexperienced individual applies the wrap film, there’s a chance that the image can bleed through the wrap onto the paint. There’s also a strong chance that the paint will be scratched or chipped in the process.
You’ll be better off investing in the services of a professional who you can trust. Make sure that you choose a company that is highly-rated and has years of experience. Additionally, you should always ask for a warranty in writing. If you’re working with high-end wrap designers, they should be more than willing to offer one.
Are vinyl wraps legal?
Before engaging in a wrap advertising campaign, you’ll first need to check whether doing so is legal in your area. Many cities, especially those that are incredibly populated, have moved to ban mobile advertisements. New York City is one such example. They banned mobile advertisements, claiming that the ads contribute to traffic congestion.
Before engaging in a wrap advertising campaign, check your local laws. Otherwise, you’ll spend thousands of dollars on a useless advertisement.
Keep track of your marketing expenses
Vinyl wraps could be a valuable part of your overall marketing strategy, especially if you live in a highly-populated area. Choosing vehicle wraps will allow you to reach a broad target audience for minimal costs.
Whether you choose vehicle wraps or some other form of small business advertising, make sure you integrate it into your overall business plan and keep track of your marketing expenses.
This article originally appeared on the Quickbooks Resource Center and was syndicated by MediaFeed.org.
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Top 10 sales tax strategies for small businesses
Many of us dream of running our own business and when we act on that dream, the life of joy we envisioned can quickly turn to pain if we fail to adjust to ever-changing tax requirements. Some of the more recent tax changes apply to simple sales tax, which becomes not so simple for those with a sizeable number of online sales or high dollar amount of online sales in multiple states. If this is your business scenario, the following 10 strategies for dealing with sales and other business taxes will help you maintain or bring back the joy of running your own company.
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In the past, retailers typically needed to register, calculate, collect, and report sales tax in jurisdictions only where their business had a physical presence. This presence provided the minimum connection, or nexus, needed for a state or local to require tax registration, collection and reporting from retailers. The 2018 U.S. Supreme Court ruling in South Dakota v. Wayfair, 585 U.S. ___ (2018), however, broadened nexus to include economic presence and immediately triggered other states to enact or begin to enforce their own economic nexus laws. For a current list of economic nexus laws, by state, see the Supreme Court Tax Decision – Online Tax Laws by State. In reviewing the article, you may notice that many states base their new economic threshold on the:
- dollar amount of sales or number of transactions; or
- dollar amount of sales and number of transactions
To complicate the matter even more, the definition of “sale” is not uniform among the states, and can vary between gross, retail, or taxable sales.
Business license tax
New jurisdictional sales tax responsibilities may also trigger new Business License Tax liabilities, albeit often low dollar. Nonetheless, not understanding your tax requirements can create administrative headaches and detract you from focusing on your true passion, your business. When dealing with a tax agency directly to understand your sales and other business tax obligations it is often best practice to request the agent direct you to the written guidance on the revenue agency website to help avoid any misunderstanding or miss-guidance.
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In light of the Wayfair ruling, many states have enacted, or are in the process of enacting, new rules with regard to Marketplace Facilitators. Make sure your facilitator agreements stay compliant with these tax changes.
1099-K impact
Sales via a Marketplace Facilitator may result in the facilitator issuing you a Form 1099-K, reporting gross payments received from the facilitator on qualifying sales. If facilitators are responsible for reporting and paying sales tax on your sales via their online portals then make sure the 1099-K received is not overstating your income by the amount of this tax. If it is, then request an amended 1099-K. Otherwise, you could be stuck with the mess of having to reconcile your 1099-K reported income with a tax agency.
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Whether you are the business owner or only deal with the accounting and tax issues for the company, you should always understand what it is the business is selling in relation to the sales tax rules. Sometimes, what you think is exempt might actually be taxable, depending on the jurisdiction. If you provide a service along with the sale of goods, the service may be included in the tax base but may be exempt when provided alone. The key, know what you are selling and check your state(s) taxability rules to avoid any audit assessments down the road.
Sales tax calculator
Even if you sell standard taxable goods, for multi-state sellers it can be overwhelming to keep up with sales tax rate changes that are constantly happening throughout the US. To ease this burden, consider using a reputable sales tax calculator (including our sales tax calculator), which provides current sales tax rates for all of the more than 10,500 US state and local taxing jurisdictions.
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Not all sales that qualify for an exemption are exempt on their face. Often, exemptions apply based on the buyer (e.g. non-profit) or the intended use of the goods sold (e.g. resale). To support an exemption in these instances, a seller must obtain a properly completed exemption certificate from the buyer. Trouble arises when something about the certificate is wrong or the exemption period listed on the certificate has expired. If you have exempt sales based on receipt of a properly completed exemption certificate, you must create a process for storing the certificates and, prior to exempting any sales based on a certificate, make sure the certificate provided is one the applicable state will accept. Otherwise, you could be stuck paying for uncollected tax, plus any penalties and interest imposed by the state.
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Sometimes small businesses purchase goods for use in their business without paying any tax. If this is you, remember that there might be an obligation to self-assess use tax on the purchase. Continued failure to report use tax by small businesses may trigger an audit. The key to avoid mishap is to set-up a process to catch and report applicable use tax on purchases.
Personal property tax
Align the process for use tax accrual with any state/local Personal Property Tax compliance, if applicable, to help with tax abatement and filing deadlines.
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When a business registers to collect and report sales and use tax, the tax authority provides a notice to the business of the proper filing frequency and will issue notices per tax type if a jurisdiction treats tax types differently (IE: sales or use tax).
Filing frequency
The filing frequency defines when tax must be reported and paid to the tax authority. It is usually based on revenue and typically set to monthly, with tax due on or before the 20th of the month following the period reported. For example, an October monthly return may be due on or before November 20. 24 States have worked to unify their filing rules under the Streamlined Sales Tax (SST) and require monthly filing, but those filing rules only apply to certain sellers. The key here is to remember that every tax jurisdiction has its own filing frequency thresholds and your initially assigned frequency can change.
Tax type considerations
Many states, like Massachusetts, administer tax on sales the same way regardless of where the sale originated. Further, if a business needs to self-assess use tax on purchases, that tax is often also reported on the sales tax return. Some states, however, differentiate tax administration by tax types:
- Sales tax – intra-state sales; occurring within a state;
- Seller’s use or vendor’s use tax – inter-state sales; occurring between states;
- Consumer’s use tax – on purchases for which tax was not properly paid.
Jurisdictions with tax type distinctions typically require separate registration and reporting, per tax type. Even when businesses report different tax types on the same return, they must make sure to report each tax type on a separate line. Reporting for the correct tax types every month, in every state always helps small businesses minimize out-of-pocket tax expenses.
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More and more states are moving from paper to an electronic process for reporting and paying sales tax. Make sure to follow these e-requirements or states may assess penalties, even on zero-dollar returns.
Also, remember that states can make mistakes or have technical “glitches.” Save your online confirmations, as well as proofs of mailing and cancelled checks related to paper submissions, so that if there is a mistake, you can use that proof to eliminate penalty or interest assessed for late submissions.
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Many states offer a collection allowance or timely-file discount, regardless of whether filing returns electronically or by paper. When a discount is available, claim it. There is no point in leaving money on the table. When claiming discounts, however, be careful that your business is reporting under the correct tax type because not all jurisdictions allow a discount for every tax type.
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How can small businesses keep track of filing frequency and due dates in every jurisdiction where they are required to report, especially as that number grows? One way is to set calendar reminders, including special rules for payments. If filing by mail, it is important to note which jurisdictions treat the return and payment timely if postmarked on or before the due date or measure timeliness based on the receipt date, an issue common for Alaska locals, for example.
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Small businesses never want to miss a DOR notice or fail to timely act on a notice as required, especially an audit notice. If you have an online DOR sales/use tax account, make sure your business name, address, phone and email are current. If you authorize the DOR to send notices via the online account, set-up a process to also receive hard copies, by mail. Once you get a notice, read it and respond in accordance with the instructions and timelines contained in the notice.
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As your business grows in the e-commerce market, things can get very complicated and hard to keep track of for small businesses. Consider these 10 strategies for dealing with sales tax and a few other business taxes. It will help you retain or bring back the joy of running your own company. You can also consider the use of an automated sales tax solution such as QuickBooks Sales Tax to help manage the nuances of sales tax laws, reduce the risk of error, and minimize the likelihood of a sales tax audit.
This article originally appeared on the Quickbooks Resource Center and was syndicated by MediaFeed.org.
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Featured Image Credit: felixmizioznikov / istockphoto.
