Since Writing this post, Sri lankan stock market gained 2500 points.
All share price index was at 4200 level when this was written back in May 1, 2010. Your capital would have appreciated by 160% at the time of this update.

A small island with a land mass of 65610 Sq.KM and a population of 20 Million, Sri Lanka lies off the southern coast of India. For many, Sri Lanka was known for its high quality ceylon tea until a few decades ago. In the past two and a half decades, Sri Lanka has been picked up by the global media mostly in relation to the civil war which hampered the country, or the 2004 tsunami that ravaged South and Southeast Asia.

30 years of war did not allow the country to reach it’s potential development. The destruction to the infrastructure prior to the 2002 ceasefire is estimated to be approximately $2.1 billion, nearly 13.5 percent of the 1998 GDP.

High expenditure on defense, loss of life and damage to property, underutilized factors of production, Inability to exploit tourism potential resulted a low and volatile economic growth throughout the civil war era.

The dark days for Sri Lanka is over now.The war finally came to an end on that historical day May 17, 2009. The country did not have to wait years to witness a peace dividend. A $2.6 billion IMF loan approved in July 2009 which boosted country’s developing activities. Sri Lanka is seeing major improvements in Economic indicators after the end of war as the uncertainties and risks of the war diminishes.

Falling inflation rates has driven the risk free rate down resulting the real returns to go up.

World’s 2nd Best Stock Exchange

With favorable macro economic conditions, Sri Lanka’s only stock exchange, “The Colombo Stock Exchange” became Asia’s best performing bourse and the world’s second best after Russia for the year ended Dec 31 2009.

Colombo stock exchange is one of the most modern exchanges in South Asia, providing a fully automated trading platform. The bourse consists of 236 companies with a combined market capitalization of $12 billion.

All share price index growth

The All Share Price Index measures the movement of share prices of all listed companies in Sri Lanka. It is based on market capitalization. Weighting of shares is conducted in proportion to the issued ordinary capital of the listed companies, valued at current market price.

As you can see, Sri Lankan stock market always performed well during a peaceful environment. Even before ending the war completely, during the cease fire agreement the market witnessed a significant growth.

In simple terms, If you have invested $10,000 at the beginning of last year (2009), your investment would worth $25,080 now.

* The calculation is based on all share price index growth and I hope the readers are aware of how indexes are used to measure market rates of return.

Industry experts believe the growth to be much higher under prevailing favorable macro-economical conditions coupled with stable political environment.

Milanka price index growth

The Milanka price index comprises of 25 companies and they are selected by considering their performances over the past four quarters. The Colombo stock exchange now reviews & revises the companies to be included in the MPI on a biannual basis.

MPI also behaves identical to ASI when macro-economic and political factors change. It also saw a significant growth during the cease fire period and reaching new grounds in these post war Era.

If you have invested $10,000 in a portfolio consisting of Milanka companies at the beginning of last year (2009), your investment would worth $27,351 now.

Individual company performances

Sri Lankan mass predicted and felt that the war is near it’s ending when they got ready for the new year 2009. Local and foreign investors started collecting shares knowing that good times are ahead. Their predictions were right. Financial analysts picked solid companies from sectors which has the potential to gain from peace dividend quicker than other companies and gave Short and Mid term buy signals.

Let’s see how few of them performed in the market.

All my individual company selections were based on my stock broker’s research recommendations. They gave positive buy signals to many companies which did extremely well and following companies were among those they recommended.

Diversified sector
To represent diversified sector, I took John Keels holding PLC which accounts for 9% of total market capitalization. Their business activities includes Tea Exports,Insurance,Pest Control,Industrial & Agro Holding Company Chemicals,Treatment of Timber,Management of Plantations,Travel & Tourism,Hotel operations.

In simple terms, if you have invested $10,000 on John Keels Holdings at the beginning of last year it would worth $37,800 now. I have not accounted for exchange rate fluctuations during the time period.

Today one dollar equals Rs 114. For up to-date exchange rates please refer http://www.cbsl.gov.lk/

Hotels Sector

To represent Hotels and Travels sector I selected Aitken Spence Hotels which was one of the analyst’s favourite picks during the considered time period.

In simple terms,

Banking And Finance Sector
I selected Commercial bank of Sri Lanka to represent banking & Finance sector as I believe they are the best banking Institution in Sri Lanka.

Which means, if you have invested $10,000 on Commercial Bank PLC at the beginning of last year it would worth $33,900 now.

Are you too late?

True enough that most stock prices have sky rocketed when comparing with last year prices. As a result, the overall market price earning ratio is approximately 20 indicating that most shares are over rated at the moment. But it also shows that current investor sentiment is that the stocks are worth more,their future prospects are bright, and sellers are only giving up their stock at higher prices.

We should also not forget the fact that last quarter data of 2009/2010 financial year is not yet released to the market. Most companies have performed exceptionally well in the last quarter and once that financial data is released the P/E ratio will come down to fair levels.

Equity analysts forecasts company profits will rise by a mean of 60 percent this year. The consumption levels are increasing and earnings will keep growing in the next two to three years as a result of it. There has been no better timer to invest in Sri Lanka.

Start Investing

Foreign ownership of up to 100% is allowed in most of the listed 236 companies. Individuals, Regional Funds, as well as Companies incorporated outside Sri Lanka are permitted to invest in sri Lankan stock market.

Investment in shares in Sri Lanka and withdrwals of proceeds should take place through Share Investment External Rupee Accounts (SIERA) opened with commercial banks. The repatriation of proceeds arising out of investment made after 5th June 1990 are not subject to Exchange Control regulations.

Choose your Stock Broker

There are 15 licensed full service broker firms in Sri Lanka and all of them are maintaining the same brokerage. It is a must for you to select a broker firm with a qualified and experiences research team as your investment decisions will be based on their research reports. Select a broker firm which is capable of providing unique investment insights through extensive deep dive researches.

Following is the list of equity brokers in Sri Lanka and their locations.

1. J B Securities (Pvt) Ltd.
150, St. Joseph Street, Colombo 14.

2. Bartleet Mallory Stockbrokers (Pvt) Ltd
Level “G “, “Bartleet House”, 65, Braybrooke Place, Colombo 2.

3. Acuity Stockbrokers (Pvt) Ltd.
Level 6, Acuity House, No. 53, Dharmapala Mawatha, Colombo 3.

4. John Keells Stockbrokers (Pvt) Ltd.
130, Glennie Street, Colombo 2.

5. Asha Phillip Securities Ltd.
Level 4, “Millennium House”, 46/58, Navam Mawatha, Colombo 2.

6. Assetline Securities (Pvt) Ltd.
3rd Floor, “Forbes & Walker Building”, 46/38, Navam Mawatha, Colombo 2.

7. Somerville Stockbrokers (Pvt) Ltd.
137, Vauxhall Street, Colombo 2.

8. Lanka Securities (Pvt) Ltd.
228/2, Galle Road, Colombo 04.

9. Asia Securities (Pvt) Ltd.
Level 21, West Tower, World Trade Centre, Echelon Square, Colombo 1.

10. Ceylinco Stockbrokers (Pvt) Ltd.
Ceylinco House, Level 9, 69, Janadhipathi Mawatha, Colombo 1.

11. Capital Trust Securities (Pvt) Ltd.
42, Mohamed Macan Markar Mawatha, Colombo 3.

12. S C Securities (Pvt) Ltd.
2nd Floor, 55 D.R. Wijewardena Mawatha, Colombo 10.

13. CT Smith Stockbrokers (Pvt) Ltd.
4-14, Majestic City, 10, Station Road, Colombo 4.

14. DNH Financial (Pvt.) Limited.
Level 16, West Tower, World Trade Center, Colombo 01.

15. NDB Stockbrokers (Pvt) Ltd.
5th Floor, NDB Building, 40, Navam Mawatha, Colombo 2.

I have been trading in the Sri Lankan stock market since 2004 and have associated with many brokering companies and investment advisors. Feel free to contact me if you need any background information on your selected broker company.

You can also contact me if you need any further information or if you have further questions regarding this article. I will try my best to send you a feedback in a timely manner. ( Within 36 hours depending on the question).

Happy Trading !!!

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How to register your business in Sri Lanka.

It is a good practice to register your business before it is late. There is a late fee from your local authorities if you leave it for too long.

Let the fine aside, neither banks, nor any organization will recognize you as a valid business entity without the business registration. Even if you run your business totally online there are lots of advantages when running it as a registered business.

Situations where you need the business registration.

*To apply for a credit card.

*To apply for a bank loan.

*To battle law suits. ( Beleive me this is a possibility no matter how clean you are.)

*To impress your in laws :D

This post has been written with the assumption that your only source of income is from the online/ offline business you are running.

I know lot of sri lankans who run web hosting, web developing, web marketing businesses never register their businesses. And most of the people who are running offline services businesses also forget this fact. If you come here from a google search, ” How to register a business in Sri Lanka” , the following is written solely for you.

There are 3 Types of practical entities you can start.
1. A sole trade business. – You are the only owner of the business.
2. A partnership – Ownership can be between 2-20 partners.
3. A private limited company – Refer your old “business studies” notes.

When you are first starting out, it is better to go with a sole trade or partnership type of business. In order to register your business, you need to go to your ” Provincial company Registration Authority”. For western province , it is located at Union place near Nawaloka Hospital.

For a sole trade, the registration fee is just Rs 500/= and you can get it within a day If you pay Rs1000/=. Otherwise they will mail you the registration within 2 weeks.

How To open a business account in Sri Lanka.

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Once you have a business registration certificate in your hand, the next important step is to open a business account with a commercial bank. If you have to prove your income in any situation, ( To get a credit card, Apply for a bank loan.) your bank statements will come in to your rescue.

To open a business account also known as a current account, most of the banks require you to meet the bank branch manager directly. So do not waste your time with banking assistances and go to the person who you should meet.

If you are running an online business you might have to think of ways to explain the business plan to your bank manger. In Sri Lanka most of the people are not familiar with the concept yet.

I did not have to go through the trouble as I am running a offline business together with my web sites. But do not worry, they are good people and will listen to you. After all, they need your business.

I almost forgot, you need at least Rs 50,000 to open a current account in Sri Lanka. I do not know whether any bank has lower their minimum requirement but when I had to check last year , the minimum was in 50k to 100k range.

Once you have opened a business account, do not just leave it there. Financial Institutions make decisions based on the amount of transactions you have done and on the value of them. Consider this as a salary sheet. This is all you have as a legal document to prove your income. Do not go and ask for a loan with a blank bank statement. Just because you are running a registered business, no one will believe your earning capacity unless you have numbers to prove it.

So try to do all your business transactions through your bank accounts. Even pay your utility bills through this. Give your buddies cheques and get cash. Or vice a versa. Don’t tell anyone that you learn it here :D

How to apply for a Credit Card in Sri Lanka.
Once you have 3 bank statements with good numbers in it, you can apply for a credit card. The application form says that your business registration should be at least 2 years old but I have never seen anyone having problems if you have good numbers in your bank statement. I got my first credit card soon after I finish my A/L’s.

I do not know the exact situation behind Seylan bank at the moment. But one thing I know is they are super fast in approving your credit card. I have CC’s with 3 banks but Seylan service has been the best so far.

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Keep Accounts in your start up business.
There are many small business accounting packages available. This is a very important factor for any business. I am not going to write the benefits of having a proper accounting system but keep in mind that it is a must. If you find it difficult to maintain accounts by yourself or if you do not have enough money to hire someone, at least keep records of your income and expenses. File all your invoices received and issued.

At the year end you can go to a small audit firm and ask them to prepare audited financial accounts for you. Do not worry; It will not cost you much. But the benefits are endless. Any bank will accept these audited financial accounts as a valid proof of your income.

Open an Income tax file.

Don’t put a face now! Having a income tax file is a great advantage. They are not going to rip you off. Most of the bad things you heard are spreaded by people who has never paid a single cent as income tax.

After deducting all the tax allowed expenses you do not have to pay a considerable amount anyway. You can get assistance from a tax adviser for a very small fee to determine how much you have to pay.

When you applying for a bank loan If you have a income tax file under your name the whole process will be much easier for you. They do not care whether you pay Rs 5000 or Rs 500000 as tax. But they will know that you are a credible person with a sound income.

In this article we have talked about how to start a business in Sri Lanka. The basic details regarding how to register your business?, how to open a business account?, How to apply for a credit card? And other areas related to small businesses in Sri Lanka have been briefly discussed. If you have further questions do not hesitate to ask them here at the comments section. I will do my best to answer them ASAP.

If you are determined to do something, yet do not know where to start, I always advice to start a internet business. It will only cost you few thousand rupees and you can use the earnings as a capital to start a solid offline venture. I know few dozen people who has successfully done it. Why not you?

Related Must Read Article.
How To start a web site to make money online?

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As you know, I have been trading forex with eToro for over a year now. That is why it took me this long to actually try the trading platform of HY markets.

Well, I regret waiting this long. They offer trading opportunities to areas I never dream of involving. Other than forex, you can trade oil, gas, Metal, Commodities, indices and stocks. They offer a web based trading platform as well as a advanced trading software.

They will provide your own investment managers, advisers, latest updates and charts to plan your investment. So do not hesitate to open an account and try this today. Opening an account is 100% risk free.

I had a great time trading Gold. You can trade Gold, silver, Copper in the metal section.

And in the stock trading section you get Apple, GM, Google, IBM, Juniper, Sun Micro, Time Warner, Exxon Mobil and Yahoo shares to invest in and your trade size starts from 10 shares and can go up to 10,000 shares. If you live in a country other than USA and still wanted to invest in U.S stocks this is the cheapest and easiest way to do so.

You can trade Following U.S stocks with HY markets like you are a U.S citizen.
Note: There is a poll embedded within this post, please visit the site to participate in this post's poll.

HY markets is regulated by the FSA of the United Kingdom and has regional offices in London, Hong Kong and Dubai.. You can start real trading accounts with an investment as low as $50. And the best think I like about them is the fact that they give personalized customer support to suit your needs. You can plan your investments with the support and service they are giving.

You can request for a demo account first if you are concerned about your trading knowledge and want to improve trading skills prior to trade for real.

I am having a great time trading Gold and will buy some Google stocks when I have some excess money. :-) Visit them and have a look.

Do not forget to read,
Step By Step Guide To Your First Forex Trade.
11 Top Secrets Of Online Money Making.

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This is a letter written by a patriotic Sri Lankan Who loves our country.

Why worry about the oil hedge Scam?

Firstly all patriotic Sri Lankan are shocked by the biggest foreign exchange scam in the history of the country with a lead foreign bank making use of the poor risk management skills of the chairman of CPC. Nationalistic Sri Lankans are shocked and traumatized due to the following reasons.

What is the impact?

1. My country’s foreign reserves will shrink by a massive USD 400 million. With USD 400 million the government can provide the entire country 100% FREE fuel for 45 days.

2. With USD 400 million, I can fund the war for more than 3 months.

3. With USD 400 million, I can provide the population of 19 million a subsidy of Rs 2300 each month. This includes for you and me.

4. My country has never been in need of foreign exchange more than now. Recently our foreign exchange position has depleted from USD 3.5Bn to USD 2.5bn due to the intervention by central bank to maintain rupee stability.

5. The biggest financial challenge for any Country amidst the on-going global financial crisis is to save the own foreign exchange. Not to pay for this.

6. If we lose USD 400 million, then the US Dollar against rupee will move from 110 to 125. The country will go into an economic crisis and this will be the starting point.

7. Why not spend the USD 400 million, we can fund the new port or the coal power plant projects.

How Did CPC get exposed?

This was started by Standard Chartered Bank. SCB operates in more than 65 countries and was awarded with the Global Energy Risk Innovation Award for beginning this transaction in 2007 in Sri Lanka. This indicates no other country was stupid to buy such hedge products except Sri Lanka.

SCB started selling unfair deals using unethical means (explained later). Later Citibank and Deutsche and Commercial also followed the party influenced by the greed for profits – “why not we also make money.” was the desire also for these banks.

The smart Bank of Ceylon and HSBC refused to enter into such agreements as they understood the unfair structure. Here are the reasons why it is unfair deal and why we should feel sorry for the government. You decide whether you would enter into such a structure or even gamble against such odds.

This is only a financial instrument and not a contract to buy oil. it is a huge wrong gamble that oil price will only go up up up and never down.

The hedge was one sided in favor of the bank – meaning there was NO floor for CPC to protect the down sided risk but with a nice cap to protect the banks risks. Unfair, unfair and this is not even a gamble but a cheat.

2. Any benefits the banks pay only for 2 months but CPC has to pay banks for 12 months. Sounds stupid but truly happened. Again not a gamble but a cheat structure. so if oil prices went up even double, CPC gets peanuts USD 3 Million per contract. amazing isn’t it!! so how can CPC say if price
went up i would get the blame for not hedging????

3. CPC pays for double the quantity hedged if price goes down, whereas the bank pays only for half the quantity hedged if price goes up. Have you heard of such a deal before?

4. Banks maximum exposure is USD 3 (THREE) million per transaction and CPC’s unlimited, as much as USD 400 million. you decide if this is a good deal.

5. Finally the deal is CPC paying for double the quantity, for 12 months with no floor to cover the down risks. For the bank, its half the quantity, for two months with a cap on the upside payment. This is not gambling but cheating. Because CPC is betting on a card pack where all the cards in there favor are removed from the pack.

6. This structure was called zero cost. Actually the banks should have paid an upfront premium to CPC for entering into such transactions.Alternatively the banks have reported more than USdollar 35 million (3.6 billion rupees) in profits from such transaction and the head offices of these branches have earned more than USD 52 million. (5.4 billion rupees) Central Bank and published financial records will indicate that these banks have already repatriated more than 27 million dollars during the past 9 months from the country to their head offices. And the big payments have not started yet….rs40 billion.

How Did CPC get scammed?

Good question and we all wonder why? You decide, if these are ethical practice and good governance.

1. The Chairman of CPC and a top decision maker traveled to Singapore, Dubai & USA several times on first class. The tickets were purchased by the foreign bank. The CEO of the foreign bank also joined them during these visits for entertainment and the travel never related to do with hedge. Although Mr. Asantha De Mel told recently at a press conference that he traveled globally to learn about hedging. Dubai and Singaporeare the most entertaining places in the world and you can imagine the fun. It’s a shopper’s paradise with lots of other activities.

2. The expenses during the travel were millions of rupees for entertainment plus – plus –plus. These were paid locally and also via the foreign branch offices. A scrutiny of the local bank records will reveal this. One of the marketing head responsible for selling this product in a foreign bank is the local pimp to the foreign CEO. He was given a handsome bonus including a vehicle for Rs 25 million, which he even travels today. Additionally was promoted as Head of the Corporate structure despite his own records for fraud in the bank.

3. Accounts were opened to the local decision makers in Singapore(Orchard Branch) and Dubai(Al Mankhool) which is the usual practice to say thank you for very large deals by international banks. As a matter of fact government officials were employed by the bank.

4. The bank not only employed government officials but also their family members. Miss Stephanie De Mel the daughter of the Chairman of CPC was provided employment at the Standard Chartered Bank dealing and Forex room a highly restricted area. The Petrol hedge product was developed in this room. Central Bank can verify this.

5. The losses started to build up in July 2008 and we all know that the derivative contracts are mark to mark on a daily basis by the banks and it is also a regulatory requirement. However, the banks did not inform and advise CPC to exit timely given the greed to grapple extensive profits
and bonuses for CEO.

6. It is industry knowledge that a few officers who had patriotic feelings towards the country raised the unethical practice within the bank. But these employees were treated un-fairly and terminated without any reasons and justification. A few of these employees have filed litigation.

More Violations!

1. There are violations to central bank directions and guidelines on
derivatives.

2. The Sri Lankan cabinet never approved this transaction. It was also
mis sold to the cabinet and the cabinet never knew about the unfair
structure and the exposure to CPC.

3. The Attorney General Approvals were not obtained for signing the
any documentation including the ISDA Derivatives Contract.

4. The board of CPC did not know the facts or approve the
transactions.

5. The Central Bank did not know the facts or approve the
transactions.

The situation now!

1. The CPC is exposed to payment of USD 400 million. CPC is defending the banks, see why above .

2. The CEO’s of the bank are putting pressure on the government, central bank and CPC to pay. If CPC fail to pay they will loose their jobs. No one has interest about the country.

3. The CEO’s of the banks are pushing to re-structure the debt claiming this is sovereign risk and willing to provide discounts and hair-cuts. this is not sovereign risk as the Central Bank & Treasury did not approve the transaction. It is not like a loan or bond. it is a speculative instrument that has gone wrong like in the USA.

4. if restructured, it will only serve to regularize the scam and still hundreds of millions of $ will have to be paid. Central Bank should declare transaction NULL & VOID The foreign banks are attempting to tarnish the image of the country by putting fear that this is sovereign default. it is not.

5. Some patriotic citizens are expected to file a fundamental rights case.

The legal fact!

1. CPC need not pay a single penny since this was miss selling.

2. There is ample evidence for miss selling.

3. There are ample court cases where court never favored mis selling
and have pronounced that these transactions are null and void. There are
legislative laws in the UK, USA, Canada, Singaporeand various other
countries against such acts to protect governments and its citizens.

Can the foreign Banks help the country for future foreign Debt?

The CEO’s of foreign banks are putting undue pressure and fear on the government and the Central bank saying that this is a sovereign default and the government will not be able to raise any debts in the future.

1. The current global financial crisis is expected to continue
for at least for the next two years. In this situation several foreign
banks are getting bankrupt and in fact the governments are helping them
with bail out plans.

2. Citibank and Standard Chartered Bank shares have crashed by
over 60% and they are looking for help for themselves to survive from
governments. They have no liquidity and risk appetite.

3. The three foreign banks involved in this transaction have no
commitment to the soils of Sri Lanka. The proof is that all of them do not
have a single branch outside Colombo although they have been milking the
country for over 100 years.

4. The recent debts raised by the foreign banks are in fact
international syndicate loans and these banks only acted as brokers and
there participation is less than 5%. The government can do the same
structure with other local banks as well as other foreign banks.

5. In the present global financial crisis and Sri Lanka’s low
credit rating, it is anyway not possible to borrow more overseas at
acceptable rates. so better save the reserves you already have.

6. Why should the government pay USD 400 million which had no
benefit to the country to repay a new USD 200 or 300 million of debt.
First save what you have in your hands.

What should the Government Do!

1. Appoint an independent committee to investigate into the mal
practices.

2. Central Bank has started investigation but there is severe external
pressure on them to close their eyes.

3. The bribery and corruption department and the CID to investigate.

4. Legally punish for the offense and save the country’s foreign
exchange.

5. Do not allow the opposition parties with vested interest to take
advantage and include the government also a party to this scam. Government
didn’t know.

6. Do not allow the foreign banks to take shelter under sovereign
risk. This is not sovereign risk but mis selling and scam. Standard
Chartered was involved in a similar case (Harshad Mehta) in Indiain March
1992. The government of Indiatook a serious stand against unethical
practice and Sri Lankashould do the same. We should communicate to the
international world that we cannot be taken for foolish financial rides.

7. Take serious action against any institute, person that try to
tarnish the sovereign image of this country to shelter from mis selling.
We are a trustworthy honorable country.

8. The government should not under any circumstance agree to any
re-structure or hair-cut thinking this is sovereign default. The
government has no obligation as per proven case laws to oblige for mis
selling and corrupt deals as per international laws and practices.

If you love your country pass this on to put pressure to government not to
pay out our precious dollars on this treason scam

THIS IS WRITTEN BY AN INDUSTRY EXPERT WITH EXTENSIVE KNOWLEDGE ON HEDGE
PRODUCTS AND EXPERIENCE IN FINANCIAL SERVICES BOTH LOCALLY AND
INTERNATIONALLY WITH THE INTENTION OF SAVING THIS COUNTRY’S FOREIGN
RESERVES AND THERE BY BUILD A BETTER FUTURE FOR ALL THE CITIZENS OF THIS
COUNTRY AND THE FUTURE GENERATIONS.

This Review does not reflect the view of the owners of antharjalaya dot com. This is a letter written by a patriotic Sri Lankan who loves the country and published here to give it the much needed attention. If you have anything to add, correct or ask, please do not hesitate to use the comments section.

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The process here is very simple. Log in to your account and go to the pepperjam store builder page. You will see all the advertisers with product feeds in this section. Remember, You will only see a product feed if you have applied and got approved to that particular advertiser’s program. Select all feeds applicable to your web site or blog’s niche.

If you need, You can filter results to get more specific products. For example if your advertiser has a wide range of clothing products, you can filter it to show only t-shirts. If you leave this field blank, you will get all the products available in their program. You can also select how many products you want to display in one page. I suggest you to use at least 6 products to give your readers a good variety.

Once you finish selecting products, you can customize the look of the store. Don’t be lazy and Do not use the default settings. You can be creative here. Try testing with many color combinations as possible till you get the perfect store to impress your visitors.

You can build the store in your existing web site/ weblog or purchase a new domain just for this. I have seen many publishers built pepperjam stores on new domains. For me, I created a seperate page for my store here. The product feed will be replaced with t-shirts later on.

Doesn’t it looks good? And it can’t get simpler than that. No need to program anything. You just have to copy paste the code given by pepperjam. If you run on wordpress, Do not forget to tick the “Wordpress Optimized” radio button to get a wordpress optimized script.

And to make things much more interesting, they are holding a contest to select the best pepperjam store. If you emerge a winner, you will receive a grand cash prize of $1000. Isn’t that great? Even if you do not win, if you are among the first 100 blogs to showcase a store in your blog, pepperjam will credit $10 bonus to your account.

Do not forget to read,
Virus Guards Eating Your affiliate earnings?
Spy your competitors to become successful !

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The point of having a localized web site is, you can offer your customers,

1. More flexible payment methods.

2. More flexible Delivery options.

3. Convenient contact methods.

4. Highly targeted information.

If there are 2 vendors selling the same product, customers tend to buy from the vendor more closer to his location.

True, this is year 2008, the Era of multinational online trade. But not all customers are familiar or willing to buy things from strangers who lives 1000 miles away.

This is where your localized web site comes in to action. Speak to your customer’s heart and elaborate the fact that you are one of them.

I can guarantee that you will make more sales than you are currently making from your standard web site.

But, how are you going to get traffic to your web site? Off line methods such as news paper/ magazine/ radio advertisements in your local media is great, but it can be costly. Google comes to our rescue once again here.

People talk about key word targeted adwords campaigns all the time. But have they miss out on Placement-targeted Ad Groups? This is a great way to get your localized potential customers to your web site.

Log in to your adwords account and go to New ad group – start with placements. From there, select your area as the targeted placement. In my case it would be my whole country. If you are from USA it could be your state.

If your product is in a niche which is important only to highly targeted customers use the “Browse categories” and ” Describe topics” option. But if your product has a general appeal to everyone, use “List URLs” option. That is what I am using.

This is an awesome feature. If you type in a web site which is popular in your area it will show you a list of related web sites which is also popular in your area. Visit these sites and check their alexa rank and content. If you think it meets your required criteria add them to your list of advertising sites. In my case, I shortlisted 30 local web sites with great traffic.

Some even had alexa rank of under 20k. And the greatest thing is I don’t have to pay more than $ 0.15 per click to get featured in these highly trafficked web sites. In some cases my cost was only $ 0.05.

If you are selling a cool mobile phone gadget, people who are reading news web sites might also be interested in your product. So do not target your ads only in the mobile phone category. In fact placing them in whole different sites might improve your click through rate. And you will find less competing ads.

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I was only using key word targeted ads in the past 2 years and only started using “List URLs” option last week. And only GOD knows what I have been missing out in the past 2 years.

For keyword targeted ads my average conversion rate ( The percentage of people buy my product after coming through a Google ad) was 4.79 %. But in the last week, since I started using this option it increased to 9.12%. So basically my turnover almost doubled.

And the average cost per click also have reduced from $0.09 to $0.07. I wish some one could advised me to use this function long before. I have read many books on ad words but all of them was talking about keyword based ad campaigns.

I have given you some valuable information here. It might not be ground breaking, but I learned it myself through trial and error method. It worked. So I am sharing it with you. You can either ignore all this or start using this method. But if you do not try , you will never know what would have been the out come. To me, The biggest crime is stuck in between a decision.

If you only run a blog site it is high time you start a product related web site too. A product site can make 10x more money than your blog. Am I I am lying? Why don’t you find out for your self?

Do not forget to read,
How to cheat your visitors to sell more ?
Murder your competition with killer “sales techniques”

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