15 Things
By Rieva Lesonsky
1—Creating a Mobile App for Your Business
Are you ready to create your first mobile app? Moveo Apps explains how in the infographic below.
2—What Triggers Small Business Growth?
Kabbage, Inc., a global financial services, technology and data platform serving small businesses, recently released a survey showing insights from small businesses and the key moments that triggered their growth. The study provides actionable advice for growing companies, including:
The first 4 years are critical for success: 84% of established business owners say they reached profitability within the first four years of business, with 68% attaining profitability in the first year. Only 8% reached profitability after their fifth year in business, strongly indicating the first four years are truly make-or-break years.
SMBs regret not investing in marketing sooner: Business owners rank finding new customers as their number-one challenge, significantly outweighing cash flow and competition concerns. So it makes sense they rank deploying new marketing strategies to acquire future customers as their top focus to ensure business growth. However, marketing is their smallest annual expenditures (as low as 5% per year)—it’s consistently and heavily outweighed by payroll, rent, equipment purchases and technology investments.
But, the data shows, survey respondents wish they invested at least two- to nearly five-times more dollars in marketing each year. At each stage of business, marketing spend represented:
- 7% of all costs in their first year; they wish they spent 28%
- 13% between years 1 and 4; they wish they spent 25%
- 7% between years 5 and 9; they wish they spent 16%
- 5% between years 10 and 19; they wish they spent 23%
- 11% after 20 years; they wish they spent 23%
The cost of doing business: The business owners surveyed say they need access to as much as $10 million of working capital during certain phases of their businesses to support growth, with the majority in need of less than $500,000. However, there is a disconnect between the amount of capital a business anticipates using in the future versus the amount established businesses actually borrow:
- 1st year: 38% accessed capital vs 27% who don’t think they’ll need it
- Years 1-4: 29% vs 57%
- Years 5-9: 26% vs 50%
- Years 10-19: 17% vs 74%
- Years 20-plus: 14% vs 84%
“Nearly 20% of survey respondents say they know exactly what they need to do to grow their businesses, they just need more capital to do it,” says Kabbage Chief Revenue Officer Victoria Treyger. “Even though most businesses reach profitability in their first four years, our research shows businesses still encounter unique opportunities or challenges that require extra capital, such as bridging cash-flow gaps, making strategic purchases, increasing marketing spend or opening new locations.”
3—4 Habits of Successful Business Owners
What does it take for a business to succeed in today’s competitive environment. Check out the infographic below from the experts at QuickBridge, an alternative small business lender.
4—Peer-to-Peer Payments
Millennials are almost three times more likely than older generations to pay for food and drinks with peer-to-peer (P2P) mobile payment apps, such as PayPal and Venmo, indicting generational shifts in how we “split the bill,” according to a report in The Manifest, a B2B news and how-to website.
Other findings:
- PayPal is the most popular P2P payment app (73%) by a wide margin, though confusion over the definition of “peer-to-peer” may influence results.
- Most people prefer their favorite P2P payment app because it offers better security (26%) or most of their peers use it (26%).
- 15% of respondents who use P2P payment apps have used cryptocurrency to make a payment.
5—Personality Types
There are 12 major personality types. Check out the word maps of each below, courtesy of On Stride Financial.
6—Using Your Website to Convert Your Customers
Guest post by Qamar Zaman, Chief SEO of One SEO Company
Here are four lessons from how some of the top websites in the country convert their customers:
- 90% have a versatile face: Having a “responsive design,” which automatically serves up the best-looking web page on any device (mobile, notebooks), makes your small business look impressive and easy to access right away.
- 82% tell customers exactly what to do: They contain a clear call to action, which ensures your client—who’s often impatient—knows exactly how to contact you.
- 61% let their customers contact them at all hours: Websites that have a form give your customers instant gratification—they get to take action immediately by entering their information instead of having to wait to call your company in the morning.
- 76% show their local pride: They have 100% consistent names, address, numbers across their site to help Google recognize and map them on top—making their company accessible to local clients who don’t want to travel far for service.
7—Need Marketing Help?
According to the most recent Workforce Report from LinkedIn, there is a nationwide shortage of around 230,000 marketing professionals. This is especially challenging to resource-strapped small businesses as marketing skills are fundamental to growing a businesses and attracting new customers.
But there are ways small businesses can leverage the gig-economy to cover their marketing needs? Here are few things to consider:
- So where are all the marketers? According to the Workforce report, the cities with the biggest surpluses are Miami-Ft. Lauderdale, West Palm Beach, St. Louis, Las Vegas, and Orange County. Businesses should focus their search in these regions for a better chance of landing an available marketer with the skills needed.
- Don’t shy away from remotely working with someone: According to LinkedIn ProFinder user Scott Lambert, President and Co-Founder, Xcellimark Agency: Today, “we have phenomenal communication, collaboration, tracking and analytic capabilities through online tools—so co-location is not required in many businesses and industries. It doesn’t matter where your employees are, they can work in different locations and time zones. So why not seek the best employees, team members, or service providers for your business’s needs, regardless of where they live or are located?”
- Finding a freelancer: There are a number of resources for finding the right marketer. In fact, more than 15% of the freelancers on LinkedIn Profinder, LinkedIn’s platform that matches freelancers with individuals or businesses that need their services, are marketing professionals.
8—Insurance: Are You Covered?
InsuranceBee, a specialist small business insurance broker, recently announced the findings of its first Annual Risk Survey, showing 29% of SMBs are putting their future at risk by having no forms of insurance whatsoever. And they don’t have a solid contingency plan in place to mitigate this risk. This, despite concerns over maintaining an income and being able to make long-term plans for growing a business.
In the survey U.S. small business owners were asked whether they considered themselves risktakers, what they felt the main risks to their business were, and whether they had made any contingency plans, financial or otherwise.
Contradictory findings: The findings were contradictory with financial risk cited as the biggest concern for SMBs (93%) when setting up a business. Once they were established 47% say economic uncertainty keeps them awake at night. So it’s surprising many SMBs are without any form of business insurance to protect their income. This means they have no Errors & Omissions insurance in place, vital should a client try to take legal action against them for their work; no General Liability Insurance in place, crucial should someone file an accidental injury claim against them; and no Workers’ Compensation Insurance, opening themselves up to expensive lawsuits by employees—to name just a few.
Maureen Brogie, Senior Advisor, InsuranceBee says, “Insurance policies are not ‘nice to haves’. They’re essential for small businesses. Without insurance, if someone makes a claim against them, all the blood, sweat and tears that went into building their business could just go to waste. For most, if not all, this should be a risk that’s simply not worth taking.”
A fingers-crossed strategy: For many, it seems this decision to go insurance-less is not a calculated risk but a ‘fingers-crossed’ strategy that could be detrimental to the financial success of the business in the long term. Comments left by respondents revealed they are unaware of the risks, with some feeling that because they operate in an ethical manner they do not need insurance, and others simply stating that they are able to deal with issues themselves.
Only 27% of SMBs have cash put aside to mitigate risk, but of those, a third have only made a rough estimation of how much they actually need, and 28% are reliant on whatever is in their bank account at the time. SMBs may assume having cash in the bank is enough, but with an average lawsuit for a slip or fall costing upwards of $20,000, many small businesses would be hit hard—potentially causing a business to cease operating.
Sole proprietors at risk: In addition, sole proprietors and those earning less than $50,000 annually are the most likely to not have business insurance, leaving them completely exposed should something go wrong. Brogie says, “Micro-business owners and sole proprietors with no form of insurance are putting their income at risk on a daily basis. Without this safety net, a single claim made against them could destroy their business overnight. And as sole proprietors’ finances are often tied to their family’s income when one is at risk, so is the other.”
Considering the issue of an unjustified claim: “Many of the SMB owners surveyed might think insurance is not a necessity, but what they often don’t realize is insurance can cover their defense costs—even if a claim made against them turns out to be groundless. Legal fees can stack up quickly and it’s very hard for any business, large or small, to know how much cash they need to have in reserve to be able to deal with such an incident.”
9—Meet the Winner
Independent We Stand announced that Bridge Street Ashtabula in Ashtabula, Ohio is the $25,000 winner of America’s Main Streets contest. With a lift bridge at the center of Bridge Street’s livelihood, the Ashtabula Lift Bridge Community Association (LBCA) formed in response to planned closure of the bridge for repairs in 2008. To combat the negative economic impact of the bridge closure and to counter the recession, LBCA established traffic-generating events like fairs, festivals and open houses to draw patrons to Bridge Street businesses despite disruptive construction. The organization, a 501(c)(3) nonprofit, also began promoting and developing the Historic Ashtabula Harbor as a major regional destination for tourism, recreation and entertainment.
As part of its ongoing mission to promote small businesses, Independent We Stand created the “America’s Main Streets” contest to promote the important role Main Streets play in building economic success for their communities. For a look at a list of this year’s ten semifinalists, visit mainstreetcontest.com.
Quick Takes
10—Virtual Reality
Virtual reality is here—and there are a ton of uses for it. You can learn all about it here in Virtual Reality 101: The Complete Guide to VR from Bananatic.
11—Affordable PR
If your business needs public relations help (and what one doesn’t?) check out this PR service that offers campaigns with press coverage guarantee for $399. Promotehour helps startups and small businesses get guaranteed press coverage in media outlets with an on-demand PR campaign. Promotehour crafts a pitch with an interesting story angle, and reach out to 100 relevant journalists with a personalized pitch. The coverage plan also provides unlimited lifetime access to Promotehour’s app: Jona where you can find relevant journalists for future PR campaigns.
12—Effective Facebook Ads
Advertising on social media can be quite effective and affordable. Check out this article from Voy Media on How to Use Facebook Ads Effectively.
13—Credit Score Range
Do you truly understand what you should about credit scores? This guide, Credit Score Range: An Evergreen Guide from Credit Zeal tells you what you need to know.
Cool Tools
14—Sage and Microsoft Team Up
Sage, a market leader in cloud business management solutions recently announced its extended integration with Microsoft to deliver a swift, seamless payment experience from within the Outlook email application. With Microsoft Outlook accounting for over half of business email boxes, this new feature will enable Sage Business Cloud customers to get paid faster with no extra cost to their businesses.
Utilizing invoice payments powered by Stripe, Sage’s integration with Microsoft Outlook enables Sage customers to click ‘send via email’, through their Sage software to the end-customer. End-customers then pay invoices from inside their inbox, in just a few short clicks. Once payment is received it is automatically reconciled within their Sage Business Cloud solution, enabling Sage customers to reduce the burden of administration and focus on growing their business.
Through providing the end user with the easiest and most flexible way to pay, Sage customers are enabled to avoid late payments and maintain cashflow. With recent studies showing that small businesses spend up to 120 days a year on administrative tasks, and up to 15 days spent chasing late payments, this couldn’t be more important to help improve the productivity of businesses across the United States.
Available from June 2018 for Sage Business Cloud Accounting customers in the UK and U.S. using Stripe, with further roll-out across 2018.
15—Live Chat Service
Podium, a leading customer communication platform for local businesses, recently launched Podium Webchat, a service that enables businesses to convert website visitors into customers by taking the conversation offline to a more convenient channel: text message. Empowering consumers to text a business from its own website allows both the consumer and the business flexibility to respond, helping initiate offline, in-person interactions.
Podium says current live chat tools were largely built for online retailers and aren’t optimized for local businesses. Podium built Webchat with local businesses and their consumers specifically in mind. Businesses can more easily capture contact information of leads visiting their sites and manage all inbound communication channels from one central location. Both customers and business owners will be able to take their online conversations on the go, giving each the flexibility they want.
“By introducing this new feature we are offering local businesses the opportunity to interact with customers in a way that fosters stronger relationships across the board,” says Eric Rea, co-founder and CEO at Podium. “We’ve found many consumers prefer having the option to communicate with businesses via text.”
Maintaining staff size while offering a better customer experience was one of the main goals in developing Webchat for local businesses. The platform eliminates the need to hire a dedicated staff for live chat interactions since neither the consumer or business owner needs to be online in order to communicate with one another.
For more information about Webchat, visit the Podium Webchat information page.
Small business owner stock photo by mavo/Shutterstock
