Consider leaving your RRIF/RRSP to a child or grandchild that is financially dependent on you in their RDSP
Claim amount increased to $23 from $17 per meal, for a total of $69/day
U.S. Economic Impact payments and Canada Emergency Wage Subsidy program extension announcements
Consider whether starting CPP before, after, or at age 65, would be the most advantageous
It may mean fame, and for others it may mean power. But can revenue be a true predictor of success?
In the business world there is not right or wrong way to define success. It’s merely subjective. It is based on both the personal and the business goals that you have in place for yourself. These can vary tremendously from one person to the next. Many believe that there is in fact only one path to success, and they simply choose not to consider other patterns of thinking. In their mind, this way of thinking is what will help them to reach their end goal.
It’s all in your ability to adopt change when it comes to your current systems and process, that will help you as you carve out your route to business success. If you begin to place too much confidence in your ability to make good judgements and decisions and solely rely on old patterns of thinking, you’re giving no weight to the environmental factors surrounding you that are constantly changing.
As we all know, the costs that typically make up a business are:
- Your fixed Costs
- Your variable Costs
- Your employee Costs
And then you have your little shining beacon. Your profit.
Ask yourself. Are you measuring the right things? Many have the perception that they know what makes up the correct monetary equation to predict their profit. We believe this is a naive way of thinking unless you’re consistently taking into account the effects of both your controllable and uncontrollable costs. Unless you are 150% sure your decisions are supporting your overall goal for profitability – there will never be complete accuracy in your figures. What you are measuring needs to show:
- Continuity in accuracy
- And, the numbers need to hold the correct weight.
It’s like being the coach of a sports team. You’re employed to pick players based on their skills and their ability to play within the team. There needs to be continuity in accuracy and you must weigh up the importance of the correct statistics. What abilities are most relevant based on the current game and competition. The environmental factors.
So there you have it. Revenue can be a predictor of your success. If you choose to measure it correctly.
(1) www.oxforddictionairies.com /definition/english/success
When you’re battling the day-to-day, it can be easier said than done to identify and embrace opportunities for growth, but there are a few different areas where the right finance could help.
Take on new projects
If you have the opportunity to take on a new contract, it’s exciting news for your business, because new work means more customers, and eventually, increased revenue. Some new projects are a stepping stone for growth, whereas others will be make-or-break for your company. Either way, you might want to use finance to make things a bit more manageable.
Winning new contracts is a good sign for the quality of your service but may seem like a big challenge. Many firms choose to use finance to boost their working capital, and going down this route means you’ll be able to buy new materials or equipment, or even hire more employees.
With many alternative lenders, you’ll get the funds very quickly — in days, if not hours — so you can take advantage of new opportunities safe in the knowledge you’ve got the cash you need to see it through.
New equipment or machinery to boost growth
Updated equipment or machinery can help you work (or produce) more efficiently. There are many types of asset finance that can help you acquire new machinery or equipment — whether you need a new van, a more efficient excavator, or updated computer systems.
Whatever equipment you need, using asset finance is a simple way to kick off growth. Simply put, you can get new assets but still maintain a healthy cash flow, because you can use the assets without having to pay a huge amount of money upfront.
Pursue new markets or expand into new offices
New markets mean new customers and potentially greater traction for your product or service. However, every small business has limited resources, and additional funds may be a useful or even necessary option to realise your international plans.
Many firms use trade finance in this situation, which is designed for paying suppliers. It’s based on purchase orders, so if you’ve taken on a big new customer you may be able to raise finance even if you haven’t been trading long. In fact, one of our recent customers MyGatorWatch did exactly that, with only 6 months of trading history.
The same applies to domestic expansion. If you’re getting lots of new contracts, ordering more stock, and hiring more staff, you’ll naturally think about expanding to another location — but it’s difficult to do so if your working capital isn’t keeping up. An all-purpose business loan could be helpful here, so you know you’ve got some extra cash to cover the short-term costs while your revenues catch up.
Embrace new types of growth funding
When you’re looking at using finance to grow your business, it’s important to keep an open mind. The business finance market has changed drastically in the last decade, and innovative business finance options like crowdfunding and peer-to-peer lending can be a smart way to give yourself some financial tailwind.
There are lots of platforms that allow businesses to get equity investment or a business loan from ‘the crowd’, but it’s important to bear in mind that if you choose to go down this route, your business needs be attractive to potential investors or lenders. For this reason, it’s not suitable for every growing business, but it can be a worthwhile option to explore.
Equally, there are lots of new options for ambitious business owners looking to take over existing firms. Raising finance for mergers, acquisitions, and management buy-ins and buyouts is complex, and can be structured in many ways, but there are lots of lenders in the market who could help. If you’re planning your next move for business growth, it’s a good idea to start thinking about your funding options early.
Conclusion
Running a business is tough work, and there are many challenges you have to get through — from setup to survival, to growth. But, if you prepare your strategy early on, alternative finance can help you approach the next step and move your business forward whether you’re expanding internationally, or getting a second van.
Float allows you to see the reality of the cash flow in and out of your business. By monitoring your cash flow through Float you can be one step ahead when applying for funding – you’ll know if, and when, you’ll need to.
About the Author
Conrad Ford is Chief Executive of Funding Options, recently described by the Telegraph as “the matchmaking website for small businesses and lenders”. Funding Options has been selected by HM Treasury to help businesses find finance when they’re unsuccessful with the major banks, as part of the Bank Referral Scheme that launched in November 2016. @FundingOptions
But Poopsie’s has grown tremendously since then. Not only have they more than doubled their annual sales, but they also have an average of 15-20 employees.
In this article, we explore how Alana and her team achieved their impressive results. Specifically, you’ll learn:
- How investing in staff training helps their store be more successful
- The task delegation technique they use to improve staff productivity
- Alana’s top tips for creating shoppable displays that drive sales
Let’s get started!
Investing in additional — and better-trained — employees
We’ve said it before, and we’ll say it again: Any retailer that wants to stay competitive needs to invest in their staff. Remember, your employees are the people who are doing the selling, so if you’re looking to increase sales, start by investing in them.
Alana and the Poopsie’s team understand this, and according to her, the investments they’ve made in their workforce have significantly contributed to their success.
“Our success is for sure partly because of our well-trained staff,” she shares. “We invest a great amount of time in training our staff to be the best personal shoppers (known as ‘Poopettes’) they can be. They are one of the main reasons customers travel hours to revisit us time and time again.”
Alana says that they use “multiple layers of training” for their staff, even before their first official day. The training is also continuous, so employees are always going through some form of coaching, no matter how long they’ve been part of the company.
As for how the training is implemented, Alana tells us that each Poopette is trained by management or a subject matter expert. Their education begins with written information on Poopsie’s policies and procedures, then they move on to educational videos on selling. From there, Poopettes go through hands-on training on the sales floor, where they shadow a manager or a top-selling Poopette for a day or two.
According to Alana, they also layer on new videos and additional written information about their products and services. Managers are trained on new and hot products every day and all year round.
The task-delegation technique that improved employee efficiency
Continuing on the topic of staffing, Alana says they were able to boost the productivity of their staff by having them specialize in particular tasks.
We “decided to move away from everyone being trained to do all tasks and move towards having certain staff trained to specialize in areas,” says Alana. “For example, instead of all staff helping with receiving every day in between customers, we now have one person that does 80% of our receiving for us.”
She continues, “This has helped cut down on errors and inefficiencies in receiving, which as we all know equals lost profits, and it has allowed the sales staff to focus more on selling to customers.”
“Some other areas we have hired specifically for are: cleaning, restocking, and displays, as they were all areas consuming a lot of our sales staff’s time. We still have these Poopettes trained to sell so they can service customers if needed, but when they are in the building their main focus is their task and the sales staff covers 90% of the customers.”
Why did they decide to do it? According to Alana, they started to catch employees doing other tasks when they should have been serving the customers near them.
“It’s not that they weren’t working hard; they just weren’t focused on the customer enough for us. So we started delegating certain tasks specifically to staff to tackle and it just took off from there,” she shares.
“We still, of course, keep all staff busy between times of customers, but we are more mindful about how involved the tasks we give out are. And all the big ones are assigned to staff who are not in charge of selling that day.”
How to buy and showcase merchandise
Alana also attributed their growth to the way that they’re using their space.“Our constant focus is on how we can utilize every usable square foot of our space to best fit the needs of our customers,” she says.
Doing that involves:
Buying products their customers can fall in love with
“We put a lot of energy and effort into providing above and beyond customer service to our customers, providing unique products and services that they won’t find at Target and other familiar stores, and also in presenting our products in ways that make customers think about the items differently.
She continues, “a lot of the buying really does just come from within or the gut as they say. I’m just blessed that I’m fairly good at it. Though I do have to spend a lot of time looking through catalogs, emails, buying shows and etc to continue to find new, trendy and exciting products for our customers.”
Presenting those products in clean and shoppable displays
According to Alana, having “fresh, new, and clean” displays are critical. “Another important tip with displays is that the best selling zone is from the waist to the forehead, so you always want to be thinking through how you are utilizing that space in each and every display. Otherwise, you are letting dollars walk out the door!”
Alana says that displays that “are more boutique in style” work best for Poopsies. She says that in most cases, their sales tend to slow when they starting “massing out” their merchandise or packing items into tight displays.
The Poopsie’s team also knows which areas turn dollars the quickest, and they see to it that those displays are always in top condition.
The final piece of advice
When asked about any words of wisdom she’d like to impart, Alana focused on having the courage to try new things and take a little risk. “With all of the technology and instant communication surrounding us today, things change faster than they ever did before. So if you can’t try new things and be willing to change and change often, you will have a hard time thriving in the current retail landscape. You can probably survive but you won’t thrive.”
Most late payers don’t want to be bad payers
After sending thousands of emails and making thousands of phone calls, it probably won’t come as a surprise that the most common reason for late payment is your customer lacks the cash to pay right now. Offer them a workable payment plan and most times they’ll be back in your good books within a few weeks.
When does a good payer become a bad payer?
This is where a good accounts receivables specialist is worth every penny. Not only are they experts at coaxing your troublesome payers to lift their game, they also have excellent ‘bullshit detectors’ to know when your customer is acting in bad faith.
We typically know by the second or third phone call whether a customer genuinely wants to pay. That’s the benefit of having thousands collection calls under our belt – it gets much easier to spot the bad eggs and start a formal debt collection process earlier.
When should I use debt collection?
Statistically, the best time to send a customer to debt collection is before their account reaches 90 days past due.
Keep in mind if you gave them 30 day terms in the beginning, then they’ve already had use of your money for 120 days! So 90 days is ample time to follow a robust credit control process, leaving you with little doubt that debt collection is the appropriate next step.
Which debts should I send to debt collection?
Here are the key considerations for sending a debt to debt collection:
- Is the debt owing from the customer more than $500? Most debt collection agencies won’t consider collecting debts under this threshold.
- Is the debt disputed? Debt collection agencies cannot lodge a default against disputed debts, leaving legal action or the Small Claims Court your only remedies.
- Have you followed a good process? Have you sent email reminders and made some phone calls to try and resolve any issues and confirm the debt is not disputed? Is the customer aware that you’re taking further action that might affect their credit rating and cost them thousands in legal and collection fees?
- Can you on-charge collection and legal costs to your customer? Your terms of business should include a clause that allows you to pass on all collection and legal costs to your customer. If you don’t have this option then you might think twice about using a debt collection agency if you have to foot the bill.
Technology can help
Cloud-based receivables management software like Debtor Daddy makes it easy for any business to follow a great process and outsource parts of accounts receivables when the organisation does not have the expertise, time or resources to handle internally.
What some business owners may not know is that a business loan they got in the past could be comparatively expensive in the present. This is one of the reasons you might want to consider refinancing business debt before it starts taking a toll on your cash flow.
Consolidating debts — what does it mean?
Refinancing business debt simply means combining multiple business debts into one. It could also mean replacing one loan with another. The fundamental idea behind refinancing is to swap expensive debt for more affordable debt in order to give your working capital a little boost.
Of course, applying for more debt raises concerns about affordability. But, the key thing is to find a facility with suitable terms and rates for your situation. Let’s take a look at three common reasons for refinancing business debt.
Why refinance debt?
There are three main reasons why you might consider debt consolidation: simplicity, savings, and safety.
With multiple loans in place, it’s hard to keep track of your monthly repayments. If you’re already using a tool like Float, things will be a lot easier, but you’ll still have to deal with several different lenders.
Simplicity
Perhaps, over time, your business has accumulated a number of different loans for different purposes. What if you could pay off all those loans with only one new loan to simplify your debt management?
Refinancing could give you one single monthly payment to worry about, and only one lender to deal with. With easier debt management, you can put your mind at ease and focus on what actually matters: running your business.
Savings
The most obvious reason to refinance is to save money. By refinancing debt, you may be able to obtain better interest rates or smaller monthly repayments – both of which will help you to boost your cash flow. Lower interest rates help you pay off the debt faster, whereas spreading the same amount over a longer term will reduce the individual monthly repayments.
It’s worth reviewing your debts regularly. Your business may be in a much better position now than when you first took out your loan. If so, you may be able to approach a wider range of lenders and access a lower interest rate than before.
Safety
The third reason is safety. Refinancing can help you improve your cash flow and have more working capital that’s not being used for expensive finance. This way you can slowly bring your business into a safer position.
Sometimes, businesses struggle and cash flow gets squeezed. This can feel even tougher when you’re trying to stay on top of a monthly payment. Defaulting on a business debt can lead to serious consequences like CCJs (County Court Judgments) or insolvency, and refinancing can help make things a bit more stable if you’re going through a tough trading period.
Case study: saving with refinancing
One of our customers, a nightclub in London, got into significant debt because of a tricky situation. With under two years of trading history and urgent refurbishment costs, the nightclub owner had to combine loans from different short-term lenders, which led to high repayments every month.
When the business had passed two years of trading history, more options opened up from a wider range of lenders, and the nightclub approached Funding Options for refinancing. We found them a refinance option that replaced the most expensive loans and saved them an incredible £14,000 per month in repayments. This way the nightclub was able to repay the refurb costs at a more manageable level.
Circumstances change
It’s important to remember that what may have been a good fit for your business before, is not necessarily a good fit for your business now.
Using cash flow forecasting apps like Float can help you keep track of your business expenses. If you just started enjoying the benefits of Float, and still need to cope with old business debt, try adding different loan amounts and rates into your app to see how it’ll affect your future cash flow. This way you can prevent cash flow gaps and strengthen your trading position. If you’re not sure how to refinance your business debt, Funding Options can help you find the right fit for your situation.
How scammers trick you
Psychological tricks to make you feel obligated. A common trick is to use persuasive psychological tactics to make you part with your money. Some may offer a free gift or assistance to make you feel obliged to return the favour. Remember, you do not owe them anything so don’t be pressured into giving them something in return.
It’s hard to say no to friends
Scammers know that if they develop a friendly relationship with you, you will be more likely to listen to them and go along with whatever they suggest. Some join groups of people in churches or community groups and gain their trust. While the investment or offer appears to be going well, they can recruit new victims on the testimony of other people who are already in the scheme.
Scammers may threaten you
You may be contacted by someone pretending to be from a well-known organisation or government department who tries to scare you into parting with your personal information or money. They may threaten you with a fine, or say they will disconnect your internet, take you to court, arrest or even deport you.
Don’t be pressured by a threatening caller. Instead, just hang up and check whether their story is real by contacting the organisation using their contact details through an independent source, like a phone book or online search. Don’t use the contact details the caller gives you, or that they include in their email.
Scammers claim to be professionals
Scammers will say they are approved or associated with another reputable organisation or government agency to convince you of their legitimacy. They hope that, because you have heard of these organisations, you will trust them. They might also say they are a professional broker, portfolio manager or investment dealer. Even if they sound professional and have slick brochures and documents to send you, they are working to a carefully crafted script.
Warning: Scammers impersonating ASIC
ASIC has warned it’s Registry customers to be wary of scam emails that contain attachments or links to fake invoices. Read the media release.
Persistent phone calls, text messages or emails
Scammers can call you endlessly or try to keep you on the phone for a long time. They present you with promises of wealth or opportunities lost if you don’t take up the offer. They will not take no for an answer and might ask you about your worries to reassure you. As long as they can keep you talking, you haven’t said no.
Don’t respond to texts or emails that ask you to click on a link, download an attachment or ask you to provide personal information (like account numbers or personal details). Attachments and links may contain a virus and infect your computer with malware.
Incredible offers of easy money
Scammers are clever at offering you incredible deals that promise great returns with very little or no risk. But if it seems too good to be true, it often is.
Fake websites
Many scammers create professional-looking websites to prove to you that their product is real and worth the money they want you to pay. They can also send links to these websites in fraudulent emails which look like they’re from your bank or another business you may deal with asking you to give up personal information.
Fake social media profiles
Scammers will create fake profiles using information they have stolen or made up. They may send you a friend request or message, then ask for money to help them with trouble they are having. They may know personal details of your friends if they have hacked their accounts and, if you accept their friend request, they could gain access to your personal information and steal your identity.
What scammers want you to do
Respond to them
Scammers will often approach a large number of people through email, phone calls, and text messages in the hope of receiving a response. A response could be as simple as answering the phone, responding to their text or clicking on an email link they send you. It’s important to be cautious of who calls, texts or emails you. It will often be someone you don’t know, but it could also be someone pretending to be a person whose name you recognise.
Beware of unusual payment methods
Scammers may ask you to pay a fine or bill by unusual methods like gift or store cards, iTunes cards, wire transfers or bitcoin.
No government agency or trusted business will ever ask you to pay by these methods.
Commit to something early
Scammers will get you to commit to something early in the discussion so they can use it to get you to agree to something else later. They do this to make you feel uneasy and defend your original actions. You need to tell them that just because you agreed to something earlier doesn’t mean you can’t change your mind about it later.
Make a fast decision
Scammers often use the terms ‘last chance’ or ‘limited offer’ to make you act fast. They don’t want to give you any time to check if their offer is real before you commit to it.
If you’re being pressured to act fast, don’t. Being rushed into a decision is one of the biggest indicators that you’re being scammed.