Small Businesses Must Understand What Marketing Means

Small Business Marketing

The success of a small business depends greatly on how effectively it markets itself, its products and its services. The real challenge with marketing is that it is one of the broadest concepts that any businessperson and entrepreneur have to deal with. Every business has its specific marketing needs, and yours does too. If you have a business, you must understand marketing in its depths and the many techniques that will help your business grow and expand. A lot of the business owners believe that having a website and doing some seasonal material marketing is enough for them, but they are wrong.

Marketing has completely changed in the modern times with “digital” being the main focus. A conventional approach towards marketing will not help you achieve the goals you have set for your business.

Understand the Concept of Marketing Mix

Before you start marketing your business, you have to understand the concept of the marketing mix. Marketing mix consists of price, product, promotion, and place. While many other factors have been added to the mix recently, these four Ps remain the strongest ones to date. If you can understand the concept of the marketing mix, you will ensure allocating strict budgets and still getting the best ROIs from your marketing campaigns. You must bear in mind that spending too much on marketing does not mean you will always be successful.

Your successful marketing strategy has to be a mix of the four Ps. Before you start promoting a product, you must know the product is complete and in an acceptable form. Once the product is complete and you want to promote it, you have to make sure you promote it in the right place. You don’t want to be selling air conditioning units to the people of Siberia. Now, even if you created a great product and are promoting it in the right place, you won’t be able to sell it well if you haven’t priced it right.

You understand at this point that you have to pick every “P” of the marketing mix one by one and see if your strategy touches all of them. An important point to remember here is that the concept of the marketing mix is not limited to the “planning” phase of your marketing efforts. Even when you have executed your marketing plans, you have to keep measuring these four factors. If your efforts are not yielding any profits or positive ROIs, look at the four factors and try to find out which one has not been executed properly. Maybe you are promoting the right product at the right place but to the wrong people.

Base Your Marketing on Data

If you don’t know already, the more relevant and popular term than marketing is data-driven marketing among marketers. It is clear now that marketing without data is less effective and less practical in the modern times. Today, you have dozens of different tools to collect data about your target audience. You use these tools because the data you collect gives you deep insight into your market, what your customers want and what puts them off. In the online world, the process of data collection starts from your website. On your website, the data you can collect include the demographics of your visitors, their recent interests, their path to reach your website, etc.

There are other means of collecting data about your customers. The thing is that you will collect data from many different channels and in many different formats. Being able to view this data in one place and taking effective action on it is what the real challenge is. Companies are now looking for solutions to manage their digital marketing campaigns in one place, regardless of the nature of those campaigns. Data-driven marketing also allows you to create more personalized campaigns that are more effective in persuading your customers to use your products/services.

Look at the Right Numbers

One huge mistake that many small business owners make is focusing on the wrong numbers. You might have a great website, a strong marketing strategy and a lot of data to target your efforts in the right direction, but you can’t get any benefits until you look at the right numbers. Looking at the right numbers means that you measure the success of your marketing efforts by keeping up with the most important KPIs (key performance indicators). For you to measure the KPIs, you must set associate goals and targets with your marketing campaigns.

So, when creating a landing page for your product and get a lot of visitors on that page, it does not mean anything to you unless you are measuring some KPIs. In the case of a landing page, your most important KPIs will be the number of visitors, number of converted visitors and the sources from where the visitors are coming. Now, focusing on the wrong number would mean you are looking only at the number of visitors coming to your landing page every day. The number of visitors is only telling you that your marketing efforts have been successful enough to bring the visitors to the landing page. But how does that benefit you in any way if you don’t earn anything from those customers?

That’s where you have to measure the conversion rate. The conversion rate will tell you how much you are making from the visitors that are coming to your landing page. By focusing on conversion rates, you will put more money towards marketing campaigns that are bringing the most potential traffic, i.e., the traffic that’s converting the most.

Now, no matter how benefiting it is to focus on your conversion rates, it is still only one side of the picture. The right numbers here are your acquisition costs. If you spend on every acquired customer is $100 but you are obtaining a value of only $20 from that customer, this type of marketing is not good for you. You always have to look at positive ROI, i.e., your returns on the investments must always be higher than the amount of money you have invested in a marketing campaign.

Conclusion

So, you know at this point that marketing is a profound concept and you have to understand it in its depths to it successfully. Large companies spend millions of dollars every year on just marketing. They must find some value in this activity to spend that much money towards it. On the other hand, small business owners can often ignore the importance of marketing. They are always focusing on short-term progress and return. If they don’t see any significant results quickly, they stop spending on marketing and start looking for faults and shortcomings of their products/services.

It will pay off in the long-term to start using the right marketing tools right from today. Keep in mind that marketing tools are designed to handle different phases of marketing. While some tools help you market your products and services, others are more analytical. Another category is of tools that help simplify the use of both the types of tools. If you are thinking of starting a business or have set the foundation for a startup already, be sure to give marketing the attention that it deserves.  

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The Challenges You Must Overcome to Turn Your Small Business into a Big Business

Challenges

You might have a small business today, but you don’t want that label for the life of your business. When entrepreneurs make endeavors, they are looking to create a business that will rule the world one day. However, every business has to face some struggles in the beginning that it must overcome to become a big business. The way you handle these challenges decides the fate of your small business. Today, you will read about these challenges and the solutions to them, so if you are a small business, you can set the foundation for its success.

Knowing the Target Market

One of the biggest issues with most small businesses is that they don’t know their exact target market. Sometimes, they don’t know how to narrow down to the target market. This is a huge issue because you could have a perfect product, but you might pitch it to the people who don’t need it. Keep in mind that people who don’t need your product won’t buy it even if you try to give it to them for free. On the other hand, people who need your product will be willing to buy it even if it is priced high. For your business to survive, it needs to start selling as quickly as possible, and that’s why it is important to find your target market before launching your product.

Solution

The first step of identifying your target market is to know your product well enough. You have to ask yourself some important questions about the product and write the answers down. For example, you have to ask yourself “what existing problem does my product solve?” You also have to know if there are any other solutions available in the market for the same problem. If yes then you have to see how your product is better than them or how you can make it better. Conduct surveys on the street and social media to know the personas of the best buyers of your product.

The Right Type of Marketing

Businesses, small and big, have huge parts of their budgets allocated only for marketing purposes. However, the modern technological advancements have proven that a big marketing budget does not translate to successful marketing. So, you might have done a great job in identifying your target market, but if you approach them in the wrong way or through the wrong channel, you will not be able to reap any benefits from even the most potential market for your product or service.

Solution

Identifying your target market should help you identify your marketing methods and channels too. For example, if your product is for people aged over 50, you would not want to make Instagram the prioritized marketing channel because only 18% of the users on Instagram are aged above 50. Similarly, any product that targets executives, marketing officers and professional people should be promoted on LinkedIn before any other platform. After knowing the buyer personas, you should also select the type of marketing that best suits your potential audience. If you are creating a hip-hop music video for marketing to retired individuals or an opera video for 18-year olds, you are doing it wrong. Use website analytical tools to know what appeals or does not appeal to your website, visitors. Base your digital marketing campaigns on data—this is the era of data-driven marketing.

The Funding Problem

If there were no funding problem, every person who thinks of a unique idea would have a business. In the real world, funding is always a problem, and it is exactly the point where the journey ends for many aspiring people in business. However, it is not always the lack of funds that kill many small businesses before they even start. In fact, the important part is how much dedication you show in arranging those funds. Sometimes, people have the options available, but they do not knock on all the doors.

Solution

First, you have to know all the options you have available for arranging the funds. If you are not okay with arranging funds through the bank or in the form of a loan, take a look around at your family and relatives. You will be surprised to know how many of the people in your circle will be ready not only to give you the investment you need but become a part of the endeavor. The crowdfunding options are also there. You don’t even have to go to the investors personally today as you can visit a platform like funded.com and arrange funds online.

The Right Leadership

You can’t make a business successful unless you have the right leader in place. It is not completely untrue that the attitude of the leader sets the attitude of the rest of the employees at a company. If you lack confidence in your leadership, you will end up hiring people who lack confidence in themselves. One of the biggest problems with most small business owners is that they can’t convince themselves to delegate responsibilities. They believe in their skill so much that their mind never accepts that someone else can handle the responsibilities too. They end up taking the responsibility of everything on their shoulders and mismanaging things at the end of the day.

Solution

The first thing that needs to be fixed here is how you think. If you find it hard to delegate responsibilities, get rid of this habit as soon as possible. You can’t handle everything as the business grows and so you have to create a team right from day one. Do not hire people just because they can do the job—hire people who share the same vision as you. Do not settle for good employees because finding the best ones is taking time. Do not try to take matters into your hands all the times. Listen to everyone that’s part of the team and the decision making process. Have a great relationship with your employees.

Setting the Price

One of the most difficult decisions for a small business owner is to set the price of its service or product. When you are a small business, you can’t afford to have a full-fledged marketing department. Of course, when you have a marketing department, they can set the price of your products, but when there is no marketing department, you are the one to take this decision. Price your solutions too low, and you might not make any profit at all. Price your solution too high, and customers might never buy your product.

Solution

It will be tremendously helpful in this scenario to take a look at your competitors and how they have priced their products. Secondly, you have to know a simple rule to set the prices of your products and services. You first set the price to cover your costs. Once you have started covering your costs, you set the price to cover the costs and make a profit. Once you have done that successfully, you start adding your “value” to the price. You should also know the buying power of your target market so you can keep the price within their comfort zone.

These points cover pretty much every big challenge that a small business comes across. Keep in mind that some of the challenges might be exclusive to your business and industry too, but if you can overcome these common challenges, you can cover the industry-specific difficulties as well.

 

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The Growing Cyber Security Risks for Small Businesses and How to Counter Them

CyberInteractivity and interdependence of devices are increasing with time as the concept of IoT (internet of things) strengthens with time. While IoT pursues maximum convenience for individuals and businesses, it has its associated challenges too. The more intertwined the modern devices become, the higher the risk of cyber security threats will be. Small, medium or large, your exposure to serious internet threats does not depend on the size of your business. If you are a small business, you are exposed to just as many dangers as large enterprises. In fact, the downside for small businesses is that they are not as prepared as large businesses against cyber threats.

So, how are cybersecurity risks are increasing with time and what kind of risks facing small businesses today? Take a look at the many ways cyber threats pose a danger to small businesses.

The Ever-increasing Count of Cyber Security Risks

The BYOD Issue

BYOD (bring your device) is an attribute of IT consumerization. To stay productive and efficient at the same time, more and more companies are allowing their employees to use their own devices to access and use corporate data. An example of this would be a worker using his tablet to open company’s employee-related document repository or an employee accessing work emails from his smartphone. Unless you have strict policies and standards set for your BYOD implementation, your business could be at risk of being infected by malware coming from users’ devices.

Software Update Delays

Do you ever wonder why companies are so adamant at making their users update to the newest software version? This is because of the older versions of the same software, application, plugin, etc. are open to risks of cyber attacks. With small businesses relying on various applications, web applications and plugins for smooth website operations, database works, on-premise security, etc. they have to be extra careful at updating them all. Any non-updated software or application is an open window for internet thieves to jump into your system.

Internal Threats

You have to be extra careful when authorizing access to any of your employees to your network and database. Many of the attacks on big companies in the past have been allegedly perpetrated by “inside men.” Sometimes the threats from your employees are not intentional but rather innocent. The authorized person might have access their account and forgot to log out while leaving the station. Some third person can then take advantage of the situation and cause damage to the system.

Sophisticated Phishing Scams

This is a common issue with small businesses as they don’t have strict protocols for employees to follow before opening emails or social media links. While phishing scam has been around for a time, the new form of this scam is called spear phishing. In this type of attack, the scammer sends email from an address that appears to the receiver as known and acquainted. This fools the person into clicking on the link and letting a dangerous malware (a ransomware at worst) enter the system.

Lack of Cyber Security Knowledge

Sometimes, the problem is not being prepared to face a problem. This is a common case with many small businesses where owners and caretakers are under the impressions that cybercriminals won’t attack them—why would they? They don’t realize the top aspect of cybercriminals, i.e., they don’t believe in discrimination. One of the common indicators of lack of cybersecurity knowledge at a workplace is when employees choose common, easy and predictable passwords for their entry points to the company’s system.

What Small Businesses Have to Do to Counter These Threats

Set Policies with a BYOD Approach

If you want to follow a BYOD approach at your workplace, you better document policies and regulations about it. Make your employees read these manuals carefully, so they know what standards and requirements they have to meet before they bring their own devices into the office. For employees that have to access your system from remote locations, set up a secure VPN.

Gives Employees Cyber Security Training

They won’t know unless you tell them, so make cybersecurity-related training a part of your hiring process. In fact, make internet security related questions a part of your interviews. Tell your employees to log out of their accounts and computers while leaving stations. Ask them to have strong passwords. Facilitate them with applications to not only remember those passwords but also generate random and difficult passwords. Explain to them why such measures matter and what the consequences of not complying with the regulations can be.

Take Professional IT Help

Go for outsourced managed services or hire your own IT professionals to take care of the security-related issues. An outsourced service or the internal IT team will set up a complete system consisting of policies, hardware and software technologies to not only protect your database from cyber threats but also respond in time if you get attacked nonetheless.

Give Authorized Accesses Wisely and Monitor Them

You can give access to sensitive company information and the system to only a select few employees. When you give them access to the system, grant them only the permissions according to their roles. Secondly, have a monitoring system to keep an eye on the activities of these employees. Furthermore, delete the accounts or change the passwords of accounts that are no longer in use because the employees they were created for have left the company.

Choose Third Party Services Wisely

Have proper meetings and consultations before you subscribe to any third party services. To run a business in today’s digital age, you have to subscribe to many platforms or applications as services, e.g., cloud CRM. You want to be sure that you are picking an industry-recognized and reliable partner. They must have the right security measures taken to protect not only their system but every bit of information that goes on their cloud platform from your databases.

Do not forget the security of your website among all this. In addition to your databases, internal software, applications used by employees, etc. you want to update your website plugins and applications in time too.

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Debt Is Not the Death of Your Business

Business Debt

“Debt” and “business” are two words you don’t want to see in the same sentence. Unfortunately, it is not always a smooth ride for every business owner. High hopes can often make business owners get carried away. That’s why experts want you to be realistic with your expectations as a business owner. It does not matter how unique your product is or how differently you have planned to serve your target audience. You cannot expect too much unless you have tested the waters beforehand. Perhaps, you set your hopes too high at some point and dug your way into the debt trap.

Good news is that debt is not the death of your business – at least not always. Some proper planning, persevere attitude, and calculated strategies can help you dig your way out of debt too.

Free up the Money That belongs to You

The first thing you ever want to do is free up the money that belongs to you. Perhaps, you are in a business where credit transactions are common. The problem with this format is that customers can delay your payments more than the specified period quite often. They have received the product, and they have consumed it too. Not clearing your invoices does not really hurt them as much as it hurts you. Consequently, you will have to get in touch with these customers and remind them of the pending invoices.

You can ask these customers to pay you sooner. Set a deadline and ask every customer to pay by that time. It won’t be easy but do not forget that you are fighting for the survival of your business. You can boost your cash flow significantly even if half of the customers agree to pay you on your set deadline.

Boost Your Revenue

This is an area where business owners have an advantage over people who do nine to five jobs. Salaried individuals don’t have any control over their salaries. It is a fixed amount that they will receive at the end of the month. On the other hand, you as a business owner have your revenues under your control. You can decide what your business earns at the end of the month. You can change prices, launch promotions, and cut your costs significantly to increase your revenue and profit.

One of the ways to get your customers’ attention is to launch promotions. However, you have to design your promotions carefully. You don’t want to shrink your profit margins until you know your promotion will increase your customer count considerably. If you have a loyal and repeating customer base, take advantage of that. Increase the prices a little to generate more revenue.

Slash Your Costs

Cost-cutting can be a huge step for a business. You have a hundred different costs that you can cut down. First, talk to the vendors that supply you the materials for your products. Quit the marketing campaigns that are not generating any returns. Reduce your operational costs as well. If possible, ask your workers to work from home to save yourself some money on office space. In fact, you can cut down your computer, internet connection, utility, etc. costs if you can make your employees work from home. Reduce office hours if your calculation tells you that certain hours are not as productive as much as they cost you.

Pay Your Debts First

A common mistake that business owners often make is treating debts as a secondary concern. You might feel tempted to buy more inventory, fulfill some orders, and pay the overhead expenses first, and then worry about your debts. However, this strategy can go against you. You will never be able to pay your debts if you make other business expenses first. The thought of repaying the debt is stressful. You can’t make great decisions when you are stressed. You will see a huge improvement in how you tackle your business related matters once you have paid off your debt.

Consider Consolidation

You can consolidate your loans to make things easier for you. What makes debts scary and stressful for business owners is that there can be many of them. Even if you pay one debt, you then have another to worry about. This format can be mentally devastating for the business. Moreover, you might be paying different interest rates on different debts. Consolidation helps you simplify your debt repayments.

First, it combines all the debts that you have to pay into one. As a result, you have to make just one payment every month that serves as the repayment of all your debts. Secondly, it helps you take advantage of a more affordable interest rate. The fact that you don’t have a bunch of different credits knocking on your door every day can be quite relieving too.

Find a New Partner

You want to take this step only as a last resort. Of course, the sight of seeing your business shut down is more painful than anything else. That’s why you can make a new partner in business by offering some equity rather than letting your business sink to the bottom. You can ask your new partner to finance your business for the chunk of equity you are offering him/her. A crucial consideration here is not to offer too much equity. You don’t want to lose control of your business as a result of this deal. Offer only enough equity that keeps the new partner interested but does not make you lose your control over your company.

Concluding Thoughts

You must not forget that these are only the extreme measures to dig out of debt. The first cure for avoiding debt is care. Make sure you start with a solid business plan wherein you have sorted out your expenses and loans already. Sometimes, venture capitalists are not the best option to fund a business. In that case, you have crowdfunding options available. Using the latter option, you can fund your business amply without necessarily giving up equity too much equity, if any at all.

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4 Ways to Protect Your System from Malware

malwareFor a business, the benefits of going digital are immense and hard to miss out on, especially if it intends to surpass competitors. However, every business is susceptible to a few drawbacks that come with going digital, like ransomware and malware. Within the last decade, the number and risk of cyber-attacks have grown significantly.

This means that businesses need to improve their countermeasure strategy to prevent huge losses and high-risk security breaches. An attack from malware can disrupt daily operations, damage your hardware, and gain access to confidential data, putting business plans and customer security at risk. Well-renowned companies like Uber, Yahoo, and Twitter have been on the receiving end of malware, which means bad news for small businesses and companies.

Here’s how you can protect your Business Systems from Malware

Although there’s no way to avoid malware attacks completely, you can always take preventative measures that significantly reduce the risk. By implementing a well-planned strategy, you’ll be able to avoid future attacks and boost your company’s reputation.

Tread with Caution

For starters, you and your employees need to act with caution, which comes first before implementing any anti-malware software. If you’re careful about what emails you open and what websites you visit, the risk of falling victim to a malware attack becomes much larger.

Hence, the best way to avoid malware from spreading through your system is not to open emails or attachments that come from people and senders that you can’t recognize or haven’t added. Usually, hackers spread malware through a system by sending a zip file or PDF with malicious intent. They choose such files because computer users click on them unknowingly and don’t realize the mistake they’ve made until long after.

That’s why, make sure that your employees only open attachments that they’re expecting, and anything else should go to the junk folder.

Enforce Adequate Security Measures

You’ll need to bring in experts to equip your systems with top-notch security to prevent a potential attack. They’ll be able to analyze your system’s current security and evaluate whether there were any phishing attempts to eliminate the risk before it affects the computers.

They can put a firewall in place to regulate the kind of traffic that goes through your business’s network. Based on the security you’d prefer, this firewall can come equipped with an anti-malware feature that eliminates the threat and blocks malicious bugs from affecting your system.

However, some users can make the mistake of turning off the firewall which increases the risk of cyber attacks immediately. For this reason, remember to keep the firewall activated to receive news about incoming threats in real-time.

While you’ve called in a cybersecurity expert, make sure to improve the system browser’s privacy settings. This boosts computer security at a basic level and helps employees understand the effect of a single bug.

Keep Your firewall Strong, and Your passwords Stronger

Let’s not forget the importance of a strong password. Nowadays, it’s becoming effortless for hackers to guess a password right by entering strings of different combinations of letters and numbers. So, this makes it essential that employees regularly change the passwords for the email address accounts.

With each combination, a hacker grows closer to guessing your password correctly, so shortening the timeframe between your next password change can greatly reduce the risk. For a strong password, use a combination of different letters, numbers, and symbols. Don’t use your birthday, maiden name, or the name of a celebrity.

Have Backup on Standby

No matter how well you defend yourself, there’s always a chance that harmful malware can make its way into your system and breach your security protocol. In these cases, the worst-case scenario is that you’ll lose complete access to critical data and confidential customer information.

The only way to avoid losing critical data is to rely on a remote server that regularly updates itself with newly added data. It should work to create many backups based on your system multiple times throughout the day.

Not to mention, your backup data should hide in such a way that it can be re-accessed easily during an emergency. An efficient backup and recovery solution can mitigate the effects of a data breach or failure by recreating virtual servers and restoring data in a limited time to allow as minimum disruptions as possible. However, it would be best if you remembered how a local backup, as long as it’s connected to a computer, is also susceptible to malware, rendering it useless.

Assess Your Security Measures through a Professional IT Expert

It’s not enough to employ a firewall and expect your business’ system to be immune to malware attacks. To stay ahead of cybersecurity breaches, you should be consistent in upgrading your firewalls, anti-virus software, and detection applications. These applications go through updates quickly and often, making it crucial that you consistently improve your security approach with refined measures.

Each day, the requirements for robust cybersecurity change, and it’s impossible to keep up with them if you want to run a business. This calls for a professional’s work because even if it regards online security, you’ll have to make the biggest decisions. Calling in a professional IT expert can greatly benefit your business; you’ll be able to make well-informed security decisions, and they’ll give you better advice as to what you need to change.

As technology becomes more powerful, cyber-attacks become even more vicious and discreet. Now, hackers can use malicious files to breach into a system quietly and leave with important data. Although this takes a lot of preparation, the execution takes only a couple of hours. Yet, for a business, the disastrous aftermath of a breach lasts for years. Therefore, you must hire the right IT experts and employ high-performance firewall applications and security measures to avoid losing data.

 

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Business Credit Card vs. Business Loan for Funds

funds

If you have long been looking for business funds, the multiple business financing options must have overwhelmed you. Many entrepreneurs don’t want to involve outside investors to raise capital for their lean startups to avoid entailing risks such as misaligned structure and timeline.

If you are one of them, business credit cards and business loans are some of the readily available options for you. Plus, these financing options are widely accessible for the entrepreneurs who want to self-finance their business.

Regardless of what options you choose, understanding their pros and cons is essential. But before we plunge into the details, let’s quickly split the difference between business credit cards and business loan to help you choose the most appropriate option for your business.

What Is the Difference between Business Credit Card and Business Loans

No doubt, it is one of the common questions that come to mind when it is about funding your startup. Typically, a business loan refers to a lump sum amount you are paid out that you need to pay back in the form of monthly installment over a specified period. A business credit card, on the other hand, is a credit line that allows you access to money or funds to a certain limit on a recurring basis. This credit line, like another credit amount, can be paid off through monthly payments or over any period of your choice unless you meet the credit limit of each month.

Business loans are generally installment debts; however, business credit cards are revolving debts. Although neither of these options hurt your personal credit scores in the long term if you pay them on time, it is worth noting that business credit card has more potential to affect your credit card scores.  If not paid on time, revolving debt may decrease debt to credit ratio.

Moreover, business loans undeniably offer large sums of funds and may have a lower interest rate as compared to business credit cards. However, qualifying for them is nerve-wrecking since the lending process is unnecessarily long and can take months.

Alternatively, business credit cards can offer you immediate access to funds or cash you need to invest in yours.  While their interest rate tends to be higher, you have an option to pay off your full bill each month. Besides this, the best business credit cards provide a slew of other reimbursements such as credit rewards, purchase protections, and perks that can particularly benefit business owners.

Business Credit Card or Business Loan- Which Can You Get Easily?

Having good credit card scores are necessary to qualify for both business credit cards and business loans.   In addition to that, to initiate the funding process, you will be asked to apply, along with the documentation showing your revenues. However, documentation for business loans tends to be more extensive and hectic. Not only this, you may find requirements for business loans stricter in terms of business profitability and length of time.

Overall, qualifying for business loans is more difficult than getting funds through business credit cards. The requirements become even more challenging to meet if your credit scores are low or you are a startup.

Luckily, Small Business Administration offers loans for startups. Although traditional lenders invest in these government-backed loans, guarantees up to 50% percent of the loan to make the process easier.

Business Credit Card or Business Loan- Which Can You Get Easily?

There is no easy answer to the question of whether one should opt for a business credit card or business loans. As mentioned earlier, to choose the best funding option, you need to compare the best features of each alternative.

Features Business Credit
Cards
Business Loans  
Loan amount Up to $50,000 Up to $5million
Loan type Revolving credit line Installment loan
Repayment Monthly payments to the minimum credit limit to pay off a debt to avoid high interest Set payments to be paid monthly over a specified time that can go up to 25 years
Average APR 13 to 20 percent 8 to 10 percent
Eligibility Steady income and personal credit history Good  business revenue model and credit
Approval Time Seven days Weeks or a minimum of six months
Benefits Sign up bonuses, reward programs,  purchase protection, trip insurance Government-backed loans

Business Credit Card or Business Loan: What is the best Option for You?

You have compared the features of both options; it is the right time to decide which works best for you.

Business loans are Ideal for your business if you;

  • Need large sums of funds
  • Want investment for profit-generating projects that include purchasing equipment hiring staff or renting new locations
  • Want to expand an established business that generates revenues up to 100,000

Business Credit Cards are ideal for your business if you

  • are looking for options to separate finances  or sole proprietor
  • Want to use the payment option that comes with big rewards
  • Need to access cash immediately
  • Do not want to borrow money and need a payment option that allows you to pay in a month
  • Want to invest in a project that has 0 percent introductory APR and plans to make payments before its promotional period deadline

Factors to consider while Choosing Business Credit Cards and Business Loans

Your job is not done after you decide which option you want to choose and why.  There are certain factors you need to consider to make a safe choice.

  • Interest Rate–   it is important to choose the option that has a low-interest rate. The interest rate in loans and credit cards are compounding, and you will end up wasting a lot of money if you are not diligent.
  • Other fees–   choosing a business credit card means you will have to pay annual fees, foreign transaction charges, and late payment charges
  • Eligibility– applying for consecutive loans or credit cards may ding your personal credit scores by resulting in the new inquiry.  

Final Thoughts

Overall, both financing options come with their perks and downsides. Given that, it is up to you when it comes to making the decision that meets the requirement of your small business.

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Small Business Should Invest in Big Data and Analytics

Data

Big data refers to huge volumes of structured and unstructured information; however, processing such massive volumes of facts via traditional information management tools is inefficient and impossible. To understand big figures you have to realize the devices that are collecting it today e.g. bar code scanners, mobile cameras, CCTV cameras, motion sensors, smoke alarms, web analytical tools, CRMs, etc. From the examples, you can see that these devices collect a vast array of data types hence the structured and unstructured part in the definition. The sheer velocity at which the data is being produced cannot be controlled and processed using traditional methods and tools.

However, the use of big information and incorporation of big data analytical technology gives businesses the competitive edge over their competitors.

Big Data and Small Businesses

It is only a thing of the past when terms like big information and business intelligence were associated with large enterprises only. Today, small businesses have to leverage the facts they are collecting in order to remain a part of the competition. For years, cost has remained the main reason why small businesses did not adopt big data analytical technologies, but this has changed now. There are budget-friendly tools available for small businesses to take advantage of the data they are collecting today. According to some experts, small businesses can take better advantage of big information since they are able to make the necessary changes far more quickly than large enterprises i.e. real-time response to insights from available data.

According to an IDG study in 2016, 78% of the large enterprises agree that big data strategy has the power to change how businesses have always operated. This shows the acceptance of big data technology and strategies for large enterprises and strengthens the fact that small businesses could become irrelevant if they did not adopt the same strategies.

Benefits of Big Data Analytics

Big Data and Big Companies, a report by IIA Director of Research, Tom Davenport, reveals that businesses are benefitting greatly from big data analytics especially in improving their products, making business decisions faster and reducing costs. Here are some ways small businesses can benefit from big information.

·         Cost Savings

The upfront cost of implementing big information tools and strategies is high undoubtedly, but the long term benefits of doing so are matchless. The healthcare industry is a great example of how the use of big data can help businesses reduce their costs regardless of their size. Using predictive analytics, Medicare and Medicaid Services forestalled more than $210 million fraud in healthcare with just 2 years of utilizing the aforementioned technology.

In addition to preventing frauds, small businesses can also reduce their costs by steering clear of creating more inventory than needed, including better partners in the supply chain, etc.

·         Improved Decision Making

This is the biggest benefit of big data. It allows businesses to expedite decision making by processing the data fast and giving insights in timely manner. In the past, business decisions were reserved for future strategies in the light of available data and the trends that were observed in it. The amount of data that businesses are sitting on today is huge and thus more powerful insights are to be gained from it. This vast amount of information requires the use of modern big data hardware technologies. Once both the things are in place for a business, they can understand customers better, create products that are a closer reflection of what customers want and develop a brand based on most reverenced values.

·         Impenetrable Security

Businesses are more focused today on using big details to improve their core capabilities, but less attended to a more serious concerns i.e. cyber threats and security breaches. Almost every small, medium and large business is connected to the internet today. Moreover, the Internet of Things has broadened the attackable security surface for businesses making it easier for cyber criminals to attack networks and penetrate company databases.

The biggest concern for modern businesses is that they have to “respond” to cyber attacks that have already occurred rather than being able to prevent them from occurring. The use of big information and big data analytical tools can be a game changer in this area allowing businesses to prevent any security attacks way before they are executed.

Key Technologies Helping Businesses Make the Best of Big Data

As a small business, you will have to familiarize with various technologies that help you store, analyze and take action on big data. Here are some important ones:

·         Hadoop

It’s a framework supporting the storing of large amounts of information using an open-source approach. Once information is stored, Hadoop enables the use of a variety of applications using “clustered hardware” at its base. Due to the cluster of commodity hardware, it becomes possible and easy for businesses to process big data despite its increasing volume.

·         Data Mining

This is the technology that enables business owners to capture insights, patterns and trends from big information that otherwise cannot be obtained with a traditional approach. Data mining is what allows you to jump in a large sea of structured and unstructured data, make sense of it all and produce analytical insights that help businesses with real-time and future decisions.

·         Predictive Analytics

Predictive analytics walk side by side with data mining. Artificial is at the heart of predictive analytics, enabling business owners to adjust their present strategies by giving predictions about what will transpire for the business based on existing details.

·         Text Analysis and Mining

One huge concern for modern business is to analyze the noise on various web platforms such as forums, blogs, social networks, etc. to understand what customers expect from a particular brand. Finding out about brand mentions and understanding customer’s impression of your brand can help you readjust your marketing approach to gain customer loyalty. Text mining helps small to large sized businesses go through text data from emails, blog posts, social networks, etc. and hear customers “voice”.

With the rise of smartphones, artificial intelligence and IoT (internet of things) it has become clearly visible that businesses will now have to handle mountains and mountains of data, and make use of big data analytical and processing technologies to have the competitive edge.

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Why the End of the Year Is the Perfect Time to Review Your Finances

Review

Whether you have a startup, a small business, or a large enterprise, chances are the year has passed at the speed of light for you. You were review and designing your marketing campaigns, availing growth opportunities, and looking through reports when the year-end arrived. While people dedicate this time of the year to holiday delights and festivities, this also happens to be the perfect time to do a review of your finances, whether you are just an individual with a 9 to 5 job or a small business.

Why should you spend your end of the year for a financial review? Here are the top reasons.

A Strong Visual of Your Financial Standing

The most important thing about a year-end financial review is that it gives you a complete visual of where your business is standing at the moment. Everything that has happened throughout the year is now on the reports before your eyes. You can look at the information and see what has performed and what has not performed. You must have put a lot of money into marketing your products, services, and the brand as a whole. You can now see which of those campaigns have yielded promising results and which of them have proved to be futile.

The same goes for your account receivables. Compare your account receivables with those from the previous years and see if there has been an increase or decrease. If there is an abnormal increase, it is a telltale sign that you might need to change your payment plan or push more to receive your pending payments faster. Every activity you have done in the past year has painted a picture now in front of you. Whether you grew as a business, stagnated, or receded is evident at the end of the year.

The Best Time to Set New Goals

Based on how you performed in the preceding year and whether you have achieved your set targets and goals, you can set goals for the coming year. Your previous year’s performance should clarify how you have to put your marks for the coming year. Keep them realistic yet motivating and challenging enough to leave room for hard work, struggle, and progress. Not only should you be looking at how successful you were in achieving the previous year’s goals, but you should also pay attention to your current financial standing.

Best Time to Apply for Loans and Credit Processing Services

Regardless of how long you have been in business, when you apply for certain services, the service providers look at your previous year’s performance. For example, let’s say that you want to apply for a merchant account (maybe a high-risk one), so you can start processing credit card requests for your customers. When you approach a merchant account provider, they will ask for some history of your business activities—at least three months. By the end of the year, you have enough data to show to lenders and credit processing services to convince them to do business with you.

Of course, a financial review will give you a good look at whether you have done enough to impress these service providers or not. You can apply for these services with a quarterly credit history, but it will not be considered sufficient in most cases.

Best Time to Get Your Tax Files in Sync

Yes, you have been extra careful about your tax filing and preparation the whole year, but the overall integrity of your records still has a question mark on it. You need to prepare your tax files at the end of the year and calculate your liability with utmost accuracy. While tax preparation software has made the job much more manageable, complex tax files still need your accountants’ attention to get everything in sync. The important thing here is that a review not only helps you escape penalties that you might attract by putting wrong information on your file. You want to update your information at the end of the year because you want to calculate your benefits too accurately, e.g., tax credits, exemptions, standard deductions, itemized deductions, etc.

Time to Start Afresh

Your business might not have been a very successful venture. Many companies don’t make the best start, and it seems in the beginning that it would be difficult for the business to survive. However, small changes in strategies and cuts in costs can prove to be incredibly beneficial for companies. The best time to start afresh and renew all your reports and files is the end of the year. While you can change your strategies and plans midway, too, it is natural for most humans to feel the need for a new start at the start of a new year. For example, people can decide to lose weight at any time of the year, but it seems it makes the most sense to them when they do it at the start of a new year.

If you think your business has not performed well, but you still want to give it a shot, the end of year financial review can clear the path for you by telling you if you can afford to give it another try or not.

Bottom Line

There is no restriction on when you want to make changes to your business plans and strategies. However, people find it natural and more motivating to set new goals, learn from past mistakes, and make new moves when a new year starts. Throughout the year, your main goal is to keep the ball rolling.

However, at the end of the year, you have enough data collected from all your business operations and activities to know how fruitful your efforts were, which actions you should consider in the future, and the expenses that have kept you from progressing. In short, a financial review at the end of the year helps you make new and important decisions for your business.

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What the Right Team Means for a Business

Business

Just because you have a small business today does not mean it is going to remain small forever. Of course, you have to work to expand your business and turn it into a company that serves a worldwide audience. Whenever it comes to the expansion of a project, the first few things that you mostly think about are costs, taxes, cash flow, etc. What many small business owners often ignore is the right team that is crucial not only during the process of expansion but to keep the business afloat for many years to come.

The Need for a Team

The first thing that one wants to understand is why they need a team in the first place. If you have a small business and you never want to grow it, you might never need a team. However, for any businessman who has the mission of expanding with the passage of time, they need a team. First of all, you cannot act as the one-man-army. As you expand your operations, add more branches to your business and get more clients to work with, you will have to distribute those responsibilities. You can manage some of them with great efficiency, but if you think you can manage them all perfectly, you might be wrong.

You might not have paid attention to this particular piece of detail but when you try to manage everything on your own, you turn your own employees against you. They feel as though you do not trust them with the responsibilities of your business. Furthermore, they don’t see any chances of growth and this is why they do not plan to stay with you for a long time. This reduces the retention rate at your company to a low level.

Not just that, your core team is even more important when you are in a startup stage. When you present your business idea to the potential investors, they will consider several metrics to find out how successful their investments will be with you. One of the indicators for them to identify a successful startup is its core team. If your idea is unique, you have everything else in place, but your team seems to lack confidence or is missing important persons, there is a big chance you will not get any investments.

What to Consider When Building a Team

There are quite a few things that you have to consider when building your core team. Here are some of the most important ones.

  • Be Personally Involved

The first and foremost requirement of building the right team is for you to involve yourself in the process personally. No one knows your business better than you, and the many requirements to run it successfully. You can talk to an individual and know if he/she is the right person for your team. You will have to talk to everyone in person to know how they will fit or not fit. Convince yourself that this is an important process and manage enough time from your schedule to interview the potential candidates.

  • Consider Vision Alignment

When it comes to adding people to your core business team, it will be wrong to focus solely on their qualification and experience. The most important factor to look at is their vision. Do you think they are comfortable with your vision of your business? Do you think they are not just comfortable but also passionate about the same vision? It did not matter how talented, qualified and experienced they are because if their thoughts do not align with yours, they will always remain a misfit. Hiring the person who does not agree with your scope of the business is a huge mistake. Your and their position in the company will be like two people pushing a vehicle from the opposite sides.

  • Look for Leaders

You must realize that you are building a core team for your business; not hiring employees to fill certain positions at the company. Do not think of your team members as tires in a vehicle which you can replace when one goes flat. Every individual you make a part of your team should have leadership qualities—the qualities to lead the team in your absence or the absence of the appointed leader. What’s even more important is that these are the individuals who will act as your right hand. You cannot expect your business to keep on elevating and not experience any hiccups.

It is the people with leadership qualities that help you pull the business out of hard times with their will to lead and the undying attitude.

  • Involve Other Team Members

If you already have a small team, but you are looking for more people, you will have to make the existing members a part of the hiring process. When you do this, it will make them feel like a valuable part of the company. Secondly, it will also show you whether you and your existing partners are on the same page or not. They should also know what type of talent is lacking in the team just like you do. On the flip side, it will also show the potential candidates how unified your approach is. They will know they are becoming a part of a strong team and prepare mentally to fit in.

  • Consider All the Options

You have to wait before you can make the hiring decision just like consumer surveys the market before making a purchase. Some candidate might seem like a perfect fit, but you can’t reach a final decision unless you have talked to all the remaining candidates.

Creating the perfect team is only one step in the right direction. The more important part is to keep the team united and in unison. Do not forget that a melody only sounds good when all the instruments are playing in harmony. So, if you are a startup or a small business, be sure to start delegating responsibilities to the right people and hiring the ones that are missing.

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Common Spending Mistakes in Small Businesses

easy way

There is no denying that running a business is not always easy. There are plenty of challenges that reverse growth or halt progress. Precisely, if these challenges have a direct impact on business finances, it may cause several other risks that your business needs to face. In other words, managing finances is pivotal to stay on top. And if you’re a startup, finance management becomes as important as serving existing customers or finding new leads.

But, if you are like business owners who find managing money or bookkeeping a daunting task, you must know your common spending mistakes to stay ahead in the business domain. This is one way you can mitigate not only financial risks but also monitor the cash flow of your business. In other words, by controlling your spending and cash flows, you improve success chances and your profitability also.

We have enumerated a few common spending mistakes to help you steer clear of the financial management of your business.

Common Spending Mistakes in Small Business

1.     Failure in Keeping Personal and Business Expenses Separate

This might sound trivial to you, but many business owners when entering the business world make this mistake. Remember that you are in the early phases of your business, it is vital to keep the expenses separate. Although sometimes you need to rely on the personal finances to support business expenditures, you need to ensure that you h have a separate budget for your business.  Also, relying on the personal expense to fund business may cause problems in the long-term.

Once your business is operational and starts serving the customers, separate finances by making a separate business credit card. Make sure you have a separate bank account for your business. Doing so can be extremely helpful in managing tax problems and avoiding bookkeeping confusion subsequently.   It will also empower you to evaluate potential or existing cash flow issues and overall business finances before they turn into a major problem.

2.     Not Creating a Budget

You might find easy budgeting, but you cannot deny its long-term value that outweighs all initial stress and effort.

Creating a budget means analyzing how much have you earned and how much you can invest. An organized budget helps you make informed decisions about all business matters that include everything from supplies purchasing, staffing, and training to inventory. Conversely, when you work without a budget, all these tasks become challenging and may cause you significant cash flow problems. This particularly affects your business if it works with seasonal shifts, and you need this cash flow to maintain business operations during the slow months.

Fortunately, there is a wide variety of apps such as Scoro, Centage, and Adaptive insights that can help entrepreneurs not only create but also maintain a budget. Not to mention how these budgeting apps keep track of your business expenses and send you a handy report at the end of the month or year. This allows you to do preparations for tax seasons and review performance.

3.     Failure to do Financing at the Right Time

All business owners know that working capital is an essential thing to operate the business and increase its growth. If working capital runs low, your business might face a lot of issues that not easy to resolve it right away, and that may vary from unpaid bills, mounting fees to lower credit scores.  Not only that but making payrolls also become a challenge while tackling such issues. The situation may create problems when it comes to retaining your potential employees. The problems like staff shortage, inventory, and supply management lead to decreased revenues and unsatisfactory customer services.

Ultimately, the failure to meet your business financial obligations can impact different areas of business. That is why it is important not only to identify but also address the cash flow issues and to prevent poor working capital in a easy way. It is better if you seek assistance about taking control of financial matters before they become problematic for your business.

4.     Ignoring Poor Credit Scores

Recognizing the right time to consider alternative financing options like a line of credit or loan is important. However, your due diligence will not benefit you if you fail to qualify as a borrower. That means, it is essential to be vigilant about both your personal and business credit scores.

It is also important because your credit scores impact your ability to use financing solutions with suppliers or vendors. The arrangements often help business owners easy fill the gaps in their cash flow.  Moreover, with a good business score, you can reduce the insurance premium and interest rate on your loan.

Sometimes, your credit scores contribute to secure many affordable financing terms; particularly when you opt for loans, credit cards, and line of credit.  The phenomenon is confusing for many people since they are advised to keep their personal and business financing separate as an ideal practice.  

However, it is important to understand that when you sign a lending agreement as a primary applicant,  banks use your credits to determine your eligibility, repayment terms, and interest rates.  Customers are sent an annual credit report, and it is good to use it for your advantage.  Although the business credit report is hard to obtain, you can get them through various platforms.

5.     Overspending on Startup

When starting a startup, you are naturally optimistic that your business will produce good revenues if you invest a large amount in it. This optimism sometimes leads to overspending, which is another common spending mistake. To avoid overspending, research carefully about how much inventory or staff you need to take a good start.

Final Thoughts

When running a business, you may face many financial issues, and to plan for all potential scenarios is not easy. However, when it comes to cash flow, various things can be done to avoid cash flow issues. The most important thing is to be proactive in whatever approach you use to manage your business finance.  Besides this, budgeting and healthy credit scores play an important role in keeping business finance issues at bay.

Thus, the given spending mistakes are very common when a business is in establishing phase. However, you can avoid them by planning and evaluating everything in advance.

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