14 Things Entrepreneurs Need to Know
By Rieva Lesonsky
1—Business Travel Expenses
Leading automated travel and entertainment expense management software provider Certify, (in one of my favorite surveys) recently released the results of its Certify SpendSmart™ Report and analysis of business travel spending for the third quarter 2017. The data shows Uber’s growth hit its first roadblock, as business travel use was down 1% in the quarter, its only decline on record since Certify began measuring ride-hailing data. Still, ride-hailing’s overall popularity among business travelers continues to grow, with competing provider Lyft increasing to 11% of the ground transportation category total in Q3, its greatest historical gain. Elsewhere in ground transportation, taxi and car rental each lost 1%, dropping to 7% and 28%, respectively.
Analysis of business traveler spending across expense categories shows the leading brands and preferred vendors for meals, airlines, hotels and car rentals. Perennial favorites Starbucks, Delta, Hyatt and National round out the most expensed by category. In addition, SpendSmart user ratings show the most expensed brands are rarely the most loved.
The Certify SpendSmart™ Report provides analysis of vendors, expense amounts and satisfaction rating data from corporate expense reports collected directly from its customer base.
Third quarter 2017 highlights:
- Starbucks: 95% of expenses, averaging $12.20 per receipt
- McDonald’s: 02%, averaging $9.19
- Panera Bread: 68%, averaging $44.08
- Subway: 53%, averaging $18.07
- Chick-Fil-A: 42%, averaging $25.02
Most-expensed restaurants by meal
- Breakfast: Starbucks 15.86%
- Lunch: McDonald’s 44%
- Dinner: McDonald’s 76%
Top-rated restaurants (on a scale from 1 to 5, as indicated by travelers)
- Chick-Fil-A 4.5
- Panera Bread 4.4
- Jimmy John’s 4.3
- Starbucks 4.3
- Texas Roadhouse 4.3
- Delta: 98%, averaging $419.47
- American: 95%, averaging $333.44
- Southwest: 37%, averaging $277.23
- United: 12%, averaging $393.10
- Alaska: 58%, averaging $282.32
- Southwest 4.5
- Alaska Airlines 4.5
- JetBlue 4.5
- Delta 4.3
- American 3.9
- Hampton Inn: 20%, averaging $248.13
- Marriott: 18%, averaging $257.02
- Courtyard by Marriott: 66%, averaging $185.39
- Holiday Inn Express: 93%, averaging $244.39
- Hilton Garden Inn: 62%, averaging $227.75
- Hyatt 4.4
- Embassy Suites 4.3
- Hilton Garden Inn 4.3
- Homewood Suites 4.3
- Marriott 4.3
Most-expensed car rental services
- National: 22%, averaging $193.05
- Enterprise: 82%, averaging $208.51
- Hertz: 45%, averaging $209.79
- Avis: 01%, averaging $180.53
- Budget: 27%, averaging $202.83
Top-rated car rental services
- National 4.4
- Enterprise 4.3
- Avis 4.0
- Hertz 4.0
- Budget 3.6
For complete data and analysis from the SpendSmart Q3 2017 Report, go here and check out the infographic below.
2—Instagram & Small Business
Instagram just announced it has 800 million monthly users, and there are more than 25 million businesses on the social platform, up from 15 million in July. The company also says over 80% of accounts on Instagram follow a business, and two-thirds of profile visits to businesses come from people who aren’t following that business. Plus, 33% of small businesses on Instagram say they built their business using the platform.
Instagram says this shows it’s “more than a stop along the mobile journey for people and businesses; it’s becoming a place where business is done.” In light of that, Instagram has added some new features, especially for small businesses, including:
- Resources with tips and tricks so entrepreneurs can learn best practices for using Instagram to grow their business this holiday season—their busiest time. This includes:
- Answers to FAQs, including the best tools to use by SMBs
- Tips and videos on Instagram best practices from global small businesses
- Insights on how small businesses can leverage Instagram Stories and related tools like the Poll sticker
- Insights so you can learn how people found you, whether it’s feed, location tags, hashtags or explore
The company is planning to launch more tools in 2018. To learn how Instagram can help your business grow during the holidays and beyond, find out more here.
3—Office “Crimes” & Other Trends
Did you know that 90% of small business owners believe their employees take home office supplies? How many red staplers have been “lost” over the years? Or that 63% of millennial business owners have pretended to know how to operate a piece of office equipment?
The Brother Business Survey reveals some of the top small business trends experienced by small and medium business owners across the United States—including top office “crimes” and millennial trends in the workplace.
Check out the infographic below for more details.
4—The Death of the Performance Review
The death of annual employee evaluations has been a growing consensus in HR over the past few years. While most companies still have a review process, it’s true traditional reviews have long been on life support. Braver companies have been pulling the plug on the annual review process entirely.
But that doesn’t mean they’ve given up on performance management. It’s just that performance reviews have been fatally flawed from the start. They were always a necessary evil—the tax we paid annually in order to find out whether we’ve gotten a raise or a promotion, or if we’re on thin ice. Managers were never fans either. We stayed up late at night racking our brains to try to assess performance that stretched back a year, or trying to find examples to support our gut feelings. HR probably hated the process the most, tasked as they were to shepherd a process everyone hated.
We all intuitively understand how important communication and alignment are. We understand how important feedback and recognition are. We understand how important it is to get employees on track before they reach a point of no return. Reviews were the way to solve for all those things. But in time, we’ve come to find that they don’t work as intended.
In fact, here are the top three reasons a company should say RIP to the formal performance review:
- The performance review is a post-mortem, not a living, actionable process. Employees often feel blind-sided when hearing something for the first time, often months after the original event. Time is lost for them when they could have been fixing that issue, or worst, by the time the review comes, the problem could have become insurmountable. The focus needs to be on the things that really matter, everything that happens before the review – on-going coaching, feedback, development and engagement.
- The way we work is changing—things happen fast. And so must talent management processes. Goals need to be short term and evolve with the business. Static 12-month goals are a thing of the past that don’t serve the business well. Plus, managers are often impacted by the recency bias, meaning that a few weeks of performance could color the whole year. In turn, performance and development should be talked about continuously throughout the year, as things actually occur.
- The largest segment of the workforce, the millennials, won’t stand for it. They demand to be developed and developed continually. They have grown up in a social, mobile world and want on-going feedback from multiple sources, including managers and peers. If they don’t get it, they either disengage and/or leave.
While an end-of-year discussion is not a bad thing, companies should rather bring to life a review process that emphasizes daily, weekly and monthly touch points throughout the year. This way, employees are clear on where they stand at all times, which allows them to stay-the-course or course-correct as needed. And the presentation of positive and negative feedback at the same time won’t mean that positive feedback wasn’t heard at all.
We find that a handful of options can help companies better facilitate feedback, and the “best” option varies largely on the environment. These options include:
- An online performance management platform that allows for informal feedback to and from anyone in the organization
- Coaching conversation templates that help guide managers through coaching interactions with their employees
- A social communication board for teams to engage as a collective unit, and
- Actionable learning assets to support the coaching and feedback provided, among other tools.
A simple, initial step to better facilitating feedback is talking with managers about the importance of coaching and training to constructively engage their direct reports. Many companies will also incorporate a peer-feedback initiative, which is again supported by training. Once a solid foundation of coaching and peer feedback are established, companies can then advance to implementing other important aspects like agile goal-setting, linking feedback and coaching to training resources. The important thing is to go at the pace that the organization can sustain and to manage change proactively.
In time, a company might consider using software to enable and capture performance management and coaching, as it allows managers to give feedback and recognition right when it happens, from anywhere and at any time. Feedback can be augmented by aligning it to coaching plans and company values and goals and can also be triangulated against peer feedback, learning and development activities and company metrics.
Having a constant flow of back and forth feedback can limit any sense of surprise for an employee—since they always know how they are doing. It also removes reviews from a vacuum.
So is the performance review dead. I’d say no. Like a caterpillar, it has used human resource information system technology to evolve into something far more powerful. And—in the end—something far more effective for measuring and affecting employee performance.
5—Small Business Snapshot
Kabbage Inc., a global financial services, technology and data platform serving small businesses, recently released data showing the similarities connecting all small business owners, including personal sacrifices, professional challenges and growth expectations. The data shows more than 67% of respondents expect to increase revenues this year, with more than half anticipating an increase of 10% or higher. The findings demonstrate work/life balance commonalities across SBOs and illustrate what it takes to build a business, irrespective of industry.
In its poll of small business owners across industries, including retail, education, manufacturing, food and beverage, healthcare, automotive, energy and finance, Kabbage found the number-one sacrifice SBOs make each year is not taking a proper vacation—60% only one vacation per year; 23% take fewer than two vacation days annually; and, when on vacation, 75% still work.
SBOs also prioritize building their businesses over personal financial gain. When asked how they spend surplus cash:
- Invest it in their businesses—40%
- Pay themselves—21%
- Save for retirement—17%
- Set aside for personal or family investments—14%
Additionally, the survey found:
- 29% work more than 50 hours per week; 86% work on weekends.
- 47% use personal savings to pay for aspects of their business. This is particularly common among 25- to 34-year-olds (75%).
- 33% work at least three of the six major U.S. holidays (New Year’s Day, 4th of July, Memorial Day, Labor Day, Thanksgiving and Christmas.
To improve productivity and be more efficient in 2018, the data showed:
- 36 percent of SBOs will seek ways to improve their skills.
- 32 percent will invest in new technologies.
- 28 percent intend to hire more employees.
6—HR Tips for SMBs
A new study by Namely, HR benefits and payroll platform for small to mid-size businesses, shows SMBs are upping their investment in HR, “so employees and management can stay safe, informed, devoid of issues that might lead to workplace toxicity (lest they run the risk of the Uber’s or Weinstein’s of the world).”
If you want to avoid these (or other) types of scandals at your business, consider these tips from Namely:
- Most HR data is bogus: The ability to collect and understand HR data helps companies reveal what’s important to its employees and flags potential HR problems before they explode. Only 8% of companies report they have usable HR data, despite the fact that 71% of companies rate HR analytics as a high priority.
- Performance prominades (vs. performance reviews): There’s a growing movement against performance reviews citing they are too lengthy, one-sided and often the recommendations aren’t implemented. (See #4 above.) Today, forward-thinking companies have come up with unique ways to gather feedback. A common one is a weekly walk around the block with the supervisor in a more open and comfortable environment, where issues can be discussed and the walk gives a feeling of forward motion.
- The #1 goal for HR managers in 2018 is to support managers and supervisors. One way to do this is to make sure there is a clear feedback and support loop that can be done both on/offline; have tech tools in place where middle management can air feedback (good and bad), in addition allocate time for face-to-face conversations. For instance, Namely’s CEO, Matt Straz, sets aside one day a week to talk to middle / upper management about whatever they want, be it work or personal. It keeps the door of communication wide open.
And here’s a look at some of the data from Namely’s 2018 Future of HR Technology Report:
- 66% of SMBs are correlating effective HR Data to positive business outcomes
- 56% expect to tie more HR data to business results—a 10% jump from last year
4 core HR systems leading the charge in SMB business outcomes (i.e. TOP systems that provide data tied to results)
- Human Resource Information System (HRIS)
- Pre-Employment Background Checks
- Performance Management
Top 4 HR Technologies that SMBs Plan to Buy in the Next 12 Months:
- Pre-Employment Background Checks
- Performance Management
- Human Resource Information System (HRIS)
The big changes over last year are more employers are looking for talent acquisition systems and HRIS.
Top Objectives for HR Technology in 2018 (all speak to HR’s desire to support employees with a better experience)
- Ability to support managers and supervisors effectively
- Retaining Top employees
- Improving employee productivity
- Employee Experience
- And tied for 5th are:
- Attracting better talent
- Capturing data insights (analytics/reporting)
- Ability to integrate data
HR Tech Trends SMBs Care About Most (in order of importance)
- Employee Experience
- Recruitment Marketing / CRM
- Internal Mobility
- Employee Well-being
- Content and Support for HR
- Analytics and Predictive Analytics
- Candidate Experience
- AI, Automation, Machine Learning
- Talent Assessments
- Finding new sources of talent
- Modern learning solutions
- Supporting a non-desk workforce
- Alternative Employee Benefits
7—Holiday Shopping Report
Global payments technology company First Data analyzed transaction data to determine how retailers faired over shopping’s biggest weekend—and it looks like it might be a great holiday season.
Collected in a SpendTrend Report—a macro-economic indicator based on aggregate same-store sales activity across the four million merchant locations First Data processes transactions for in the U.S—the data highlights trends in consumer spending over the holiday weekend. Key findings include:
Growing spend, expanding share: Overall spending on Thanksgiving and Black Friday accelerated, growing 11.9% year-over year (YOY), compared to 7.8% YOY growth in 2016.
e-Commerce continues its climb: e-commerce continued to grow its share of total commerce, accounting for 29% of spending over Thanksgiving and Black Friday in 2017, up from 25% in 2016 and more than double the 14% it made up in 2013. Across retail categories, e-commerce grew 13% YOY, surpassing 2016’s 10.8%YOY growth.
The lead up: Pre-holiday spending (across the nine days leading into Black Friday) saw an impressive pickup, with total pre-holiday spending up 5.7% YOY, compared to 3.4% and 2.8% YOY growth in 2016 and 2015, respectively. Pre-holiday retail spending climbed 5.9% YOY, a stark contrast to 1.6% YOY growth in 2016 and 1.7% in 2015.
Retail reality: Retail saw 9.3% YOY growth over Thanksgiving and Black Friday, with an average ticket size of $78.43 across categories, up 2% YOY. Within retail, some categories did better than others:
- Electronics / Applianceswon retail, with total spending up 2%. The average ticket size grew from $148.25 in 2016 to $150.69 in 2017. This sector also saw big gains in e-commerce, growing nearly 10 percentage points from 11.1% in 2016 to 21% in 2017.
- Building materials/DIYsaw the biggest jump in average ticket size, growing +6% from $92.91 in 2016 to $98.72 in 2017. In the same category, overall spending grew 9% YOY.
- Sporting goods/hobbydidn’t fare as well, coming in last amongst retail subcategories with 3%YOY growth in total spending and -2% decrease in average ticket size.
Location, location, location: The Southwest region surpassed others, growing 12.1%, compared to 8.1% in 2016. The mid-Atlantic saw the slowest growth at 6%, down from 6.8% in 2016. South Dakota, Texas and Vermont were top-performing states.
Gift card growth: Gift cards remain popular, with the average consumer purchasing 6.5 gift cards in 2017, up from 5.9 in 2016, 5.5 in 2015, and 4.7 in 2014, according to First Data’s 2017 Prepaid Consumer Insights study.
8—Small Business Saturday Stats
- 63% of consumers say supporting a local store or community was a key factor in why they choose to purchase or shop at a physical store.
- Businesses should consider hosting a Small Business Saturday event
- Geofence Small Business Saturday shoppers
- Partner with a local retailer for maximum impact
- Advertise and socialize your involvement
9—Biggest Challenges for Small Businesses
According to the latest Wells Fargo/Gallup Small Business Index, conducted in October, hiring remains a top challenge for small businesses.
- Hiring & retaining quality staff—16%
- Attracting customers & finding new business—11%
- Government regulations—11%
- Financial stability/cash flow—8%
The Index also shows 46% of SBOs say their businesses’ revenues have held steady over the past year; 65% report their cash flow has been “very” or “somewhat” good; 39% say credit was “very” or “somewhat” easy to obtain; and 32% plan to hire in the next 12 months.
When it comes to marketing, the Index reveals:
- When marketing to new & existing customers, 53% say social media is important, while 52% say advertising gets the job done
- More SBOs (53%) are active on Facebook than other social platforms
In the next 12 months:
- 53% plan to update their websites
- 51% will increase their online presence through online marketing & social platforms
- About 1/3 will boost efforts to interact with customers via online or mobile apps
- 33% plan to increase their business’ e-commerce presence
Top Methods of Payment
- 88% accept in-person cash or checks
- 82% take (mailed in) payments via check
- 39% take in-person credit & debit card payments via traditional point-of-sale terminals
- 33% accept credit or debit card payments via a mobile POS terminal, such as Square; 12% accept digital wallet payments
10—A Different Way to Bank
The challenges small business owners face with their banking services can have a real impact on their business. According to a new survey conducted by Researchscape on behalf of Seed, one-third of small businesses aren’t provided with online and mobile bill-pay; that same percentage pays monthly, often hidden fees to their banks. Perhaps most surprising, 32% of survey respondents are not properly separating their personal and business bank accounts, which can lead to serious accounting, tax, and reporting challenges for business owners.
And, despite the rise of mobile, more than half of small businesses say they don’t have access to an intuitive, simple mobile banking app, while 65% have banks that don’t offer phone and in-app messaging support. The lack of mobile banking support makes it impossible for these business owners to manage their business on the go and leads to unnecessary time spent in a branch.
Other challenges small-business banking customers reported include:
- 63% of respondents default to the bank that holds their personal bank account when selecting a business bank and many are co-mingling their money.
- 59% say the people inside of their bank don’t know their name.
- 76% do not receive valuable business advice from their banks.
- Nearly 40% pay monthly fees regularly to their banks.
- 35% of banks do not go above and beyond with their customer service.
Seed provides a full suite of banking features built into easy-to-use, online app, including a Visa® Business Debit card, free bill pay, transfers, mobile deposits, and electronic vendor payments via ACH or paper check.
In addition to standard banking services, Seed also offers:
- A mobile business banking solution so you can run your business from anywhere
- Personalized attention and support via phone and in-app messaging.
- An online knowledge-base to help answer your questions.
- Automated monthly cash flow reports that save time spent on accounting.
- Real-time data which can be categorized, searched, and edited with memos, making it effortless to keep tabs on your finances.
- Bills, receipts, and documents can be stored alongside transactions and all data is available on accounting platforms and via download
Seed is live for iOS and the web.
Namely recently announced Namely Analytics, a new tool that provides HR teams with the data needed to make strategic people decisions.
With 71% of companies rating HR analytics as a high priority, Namely Analytics was designed to tackle the challenges so prevalent in growing companies—such as how to attract and keep great talent, how to maintain culture as you grow, and how to offer fair compensation.
Namely Analytics includes detailed reports, such as salaries, job changes, and attrition (which can cost a mid-sized company over $50,000 per departing employee). HR practitioners can endlessly customize these reports: point-in-time reporting helps to identify key trends over time, and dynamic visualizations make data-driven actions a reality. These tools enable HR, the C-suite, and department managers alike to take control of key personnel decisions across departments.
BJ’s Wholesale Club now offers a new mobile app and Add-to-Card coupons making it easier for members to save, shop, check gas prices and track their savings. The BJ’s app is available on both iOS and Android devices.
The BJ’s mobile app is an easy and convenient way for members to save. Members can access digital coupons and shop thousands of products within the mobile app. The app also shows members BJ’s Gas® locations and current gas prices, their closest club and their year-to-date savings or awards depending on membership level.
BJ’s new Add-to-Card feature allows members to digitally select and save coupons directly to their BJ’s membership card within the mobile app or online at https://coupons.BJs.com. Add-to-Card coupons will be automatically applied during a member’s in-club checkout, saving money and time. The Add-to-Card coupon gallery will feature all coupons found in The Little Book of Big Savings® published by BJ’s, in addition to manufacturers’ coupons. BJ’s is the only major membership warehouse club to accept all manufacturers’ coupons.
To learn more about the BJ’s mobile app, watch this short video.
13—Build a Better Website
14—Teach Kids About Entrepreneurship
If your kids are interested in becoming entrepreneurs you should buy them this book, The Startup Club: The BIG Idea, by financial journalist and host of MSNBC’s Your Business, JJ Ramberg, Melanie Staggs and S. Taylor.
The book is a fictional tale of two BFFs who, along with one of their brothers, launch a business. Your kids will learn valuable lessons about business—and friendship—and it’s told in a very entertaining way. The authors include a pricing formula and a P&L Statement, especially designed for kids to understand.