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The idea of course is that sourcing products locally increases the likelihood that products are hand-made with attention to detail, impeccable quality and unique design features. Perhaps local products may also be cheaper with the lack of ‘middlemen’ or transport involved in the production process. However, the decision between sourcing locally or internationally is not clear cut. Let us take a look at some considerations when choosing your supplier.

Decision Criteria

These may sound self-explanatory but if not, well, explained, they can be easily missed. It is important to identify the decision criteria when choosing a supplier. That is which points you are willing to be flexible on and which points are non-negotiable. It is imperative to consider quality when sourcing your suppliers. At first glance, the optimal quality available seems to be a no-brainer however, for some things you may be able to sacrifice a bit of quality or a quality-name for a cheaper buying price. Timing, which incorporates both production and shipping times, needs to be considered. It may well be worth paying slightly more for a shorter production time because you would save in economical versus expedited shipping. Furthermore, another driver might be economic stability such as exchange rates or certainty of provision. Once all these things have been weighed up appropriately, it is possible to conduct feasibility analyses and decide on a supplier.

International Sources

Sourcing products from overseas can often equate to low-cost country sourcing (LCCS), which is where products or materials originate from countries with exceptionally low labour and production costs resulting in modest purchasing prices. Such examples of countries where this is the case includes much of Asia, some of South and middle America and eastern Europe. This accounts for the epidemic occurrence of the words ‘made in China’ that we see all around us.

As aforementioned, there are always shades of grey and the decision to source internationally should not be reached on price alone. It is important to consider the weight and shipping of the items as, despite lower purchasing prices from LCCS, it might make more sense to source locally to save on expensive, long and weighty shipping options.

Local Sources

One of the fundamental reasons to source locally is the proximity of the purchaser to the producer. This means the purchaser has greater control over the final product afforded by frequent checks and clear, concise communication. As the consumer trend to support small and local businesses with organic and ‘wholesome’ undertones grows, locally-sourced items increase in popularity. Therefore, sourcing locally almost turns into a marketing directive where what the customer wants, the customer gets.

For a company that exists in a low-cost country, sourcing locally could well be the cheapest option. Likewise, for other countries, it could be the cheapest option due to savings with shipping. However, small and local plants are less prone to mass production, which drives up manufacturing costs and so, more often than not, local, boutique-level quality comes at a premium.

Decision Time

Sourcing locally or internationally is not a simple, cut and dry decision. It needs to be made after identifying the key decision criteria, what is vital and what can be compromised. Only after these have been found, can research on suppliers commence. It is important to also view suppliers as a partnership and so it takes work as well as requiring a length of time to get to know each other and each other’s respective capabilities. Of course, any decisions around ordering of material or inventory stock are far more informed and stress-free when precise knowledge of current stock and future needs are known. For this level of expert knowledge, an inventory management software system is the answer as it is customisable with a team of people to help you get started.

We have the top three resolutions that SME owners and executives need to consider that may really impact their SME’s bottom line and its growth.

Improve Cashflow Management

In a recent study, a major concern that was raised for SME owners was cashflow. Therefore, an important resolution is to improve cashflow management. The beginning of a new year can be concerning for small businesses due to the annual seasonal post-Christmas cashflow dip. It is foreseeable for businesses to find it extremely difficult to meet their outstanding costs on time, which creates issues for even strong and viable businesses when it comes to their end of February business activity payment statements. While many small businesses often focus on their exciting new business ideas and trying to bring them to fruition, it may mean that prioritising time on less exciting notions such as systems improvement is compromised. The beginning of the year is a great opportunity to undergo a financial housekeeping check and to put better solutions and systems in place. For example, try improving invoicing processes, to mitigate against potential disputes and improve on late payment rates. A small amount of work now in these areas may create incremental improvements that can expedite the collection cycle and therefore increasing cashflow within your SME.

Find Better Capital Options

There is a staggering low percentage of small businesses who review their primary bank relationship or actively keep an eye out for credit facilities that fit their business needs. The beginning of the year is yet another opportunity to consider what working capital options are a better fit to your business, to enable growth. In the case concerning owners of high growth businesses who do not necessarily want to use their own capital funding, an option could be debtor finance, a funding solution that grows in line with business revenue. Debtor finance is more helpful to high labour businesses where wages must be met, often before when the business is actually paid. Growing businesses can struggle with cashflow due to taking on more employees and/or ordering more stock, yet while having to wait 1-2 months to receive payment. Debtor finance enables a business to access funds straight away, without having to wait for their invoices to be paid.

Achieve a Healthy Work/Life Balance

A recent study also found that almost 90 percent of SME owners put in over 50 hours a week in to their business, and that same study found almost half were actually putting in 60 – 80 hours per week. Long hours go into running a business especially a new and growing one. Moreover, the nature of the digital space means that business owners are always accessible. It really is worth making time for a mental health check and therefore encouraging resolutions that work on an individual level to help SME owners achieve a more fruitful work/life balance. Consider taking time off to refresh for the year ahead, but also create a weekly calendar for non-work meetings and activities that help keep you refreshed also. That way as a SME owner, you have more energy and your time that you do spend in your business is the best time you can offer.

Engagement levels drop, sales decrease (and in some cases stop completely), and the store starts to resemble a ghost town.

But just because business is slow doesn’t mean you have to slow down with it. Here are some ideas to make the off-season months work for you:

1. Find ways to bring in revenue all year round

Your sales don’t have to grind to a complete halt during the off-season. No matter what kind of seasonal business you have, there’s a good chance that you can still bring in some revenue even if it’s not your busiest time of the year.

Diversify your business offerings and see if you can sell related or complementary products and services. Determine the other needs of your customers and find ways to fulfill them even when your main business isn’t in season. Have a look at what H&R Block is doing. On top of seasonal tax preparation, it also offers a number of financial services including credit lines and payroll processing. This lets it provide value and earn revenue even during off-peak months.

Want another example? Check out Halloween Club, a “costume superstore” in Southern California. While the retailer’s main business is Halloween costumes, it recently introduced a large assortment of party supplies to cater to moms and event planners who are holding themed parties or functions.

There’s also Tipsy Elves, a holiday-themed apparel company. Tipsy Elves started out selling ugly Christmas sweaters, but soon expanded to other holidays. Now, the retailer sells styles for St. Patrick’s Day, Valentine’s Day, Thanksgiving, Hanukkah, and more.

2. Cater to customers in other locations (where your products are in season)

Bear in mind that just because your business isn’t in season in one location doesn’t mean that there isn’t a demand elsewhere. Case in point: Big Feet Pajama Co., a site that sells warm and snuggly PJs. The business typically experiences a decline in US sales during the spring and summer months, but that doesn’t stop the company from thriving.

Entrepreneur.com noted that Big Feet makes up for the dip in US sales from March through August by targeting countries like Australia and New Zealand, where fall and winter are in full swing.

According to Entrepreneur, Big Feet Pajama Co. capitalized on the opportunity by launching a targeted Australian AdWords campaign and by investing in a distribution facility down under to reduce shipping costs.

See if you can apply a similar strategy to your company. Are your products or services in demand in other parts of the world? Be sure to go after those opportunities.

3. Build your community and establish thought leadership

Social media gives you tons of opportunities to connect with people all year round, so keep your blog and social accounts active.

Keep publishing blog posts and posting updates on all the channels your customers follow. Use your downtime to come up with great content that can educate your customers. Doing so lets you build authority, strengthens your community, and ensures that people will remember you when it comes time to do business again in the on-season.

Take a leaf off H&R Block’s playbook. The tax preparation company makes most of its revenue during tax season, but it publishes educational blog posts, videos, and guides all year round. And tax season or not, its social media pages remain active and continue to grow its fan base no matter what period of the year it is.

This keeps H&R Block top of mind for most consumers so it’s usually the go-to company for people when the tax months come along.

4. Serve other niches

Your business might be “seasonal” to the majority of consumers, but certain niches may have a need for your products all year round.

For example, if you sell fireworks, then your busiest period would likely be the weeks around Memorial Day or the 4th of July. But it may be worth finding clients who need fireworks beyond those key holidays. Perhaps you can partner with an events organizer or a venue that makes use of your product. Another idea is to look into corporate sales or custom products. Tipsy Elves executed this strategy really by selling custom promotional apparel. The company teams up with brands and helps them come up with custom designs.

5. Find ways to save money

If the business is really slow during the off-season, take steps to reduce your spending. Here are some areas to look into:

Staffing – If foot traffic and store activity are on the quiet side, consider reducing your staffing requirements. Perhaps you can cut back on shifts or encourage team members to take time off.Hours of operation – Generate sales reports per hour to figure out your least profitable times. For example, you may find that while you’re open from 8am to 8pm, you’re not generating enough sales from 7 to 8pm to be profitable. With that info in mind, you can decide whether it’s worth it for you to stay open that late.

Vendors/solution providers – Look at the business services and subscriptions that you have and see if you can downgrade to a lower plan for the time being. Also, see if your vendors allow you to put your account temporarily on hold. For instance, Vend lets retailers put their accounts “on ice” — a service that allows users to retain all their data and account information when they’re not actively using the software.

Space – Subletting your location could help lower one of your biggest expenses — rent. Check with your landlord to see if you’re allowed to rent your space. If you get the green light, conduct a search for other shops who would be open to moving into your location. One retailer that did this well is Metropolis, a gift-and-card shop in Seattle. In 2009, the retailer was hit by the recession and this prodded owner Terry Heiman to rent out the space. After getting approval from his landlord, Heiman started subleasing a third of his store to other merchants.

According to Entrepreneur.com, “Heiman spent $1,000 to install a loft-style wall between the spaces, and each store has its own entrance, address, and separate utility metering, making for easy division of expenses. He collects the rent and writes one check to the landlord each month.” Consider doing something similar in your business. If your lease agreement permits it, find retailers who would be willing to move in so you can share location expenses.

6. Reach out to the media

Publications usually plan their articles months in advance, so if you want to land a magazine feature just in time for your industry’s peak season, you’ll have to reach out to reporters early on. Take advantage of the slow months to gather intel on relevant reporters and publications. Get your hands on their editorial calendars so you’ll know exactly when to send your pitch.

Subscribe to services such as HARO (Help a Reporter Out) and be on the lookout for people doing stories in your industry.

7. Attend networking and educational events

Use the slow months to broaden your knowledge and network. Attend events that provide learning and networking opportunities so you can get to know people and trends in your industry. Conferences, trade shows, and even local business events can help you gain new partnerships and skills that you can use in your business, so don’t pass up the chance to attend them.

8. Get shopper feedback and reviews

The off-season could be the perfect time to get feedback and reviews from your customers. Consider getting in touch with people who purchased from you and ask them what they thought of your products. If you get a lot of great feedback, encourage customers to leave a review on Yelp or Google. Got some not-so-great reviews? Use that feedback to improve next season.

And that brings us to our next tip…

9. Evaluate your business’ performance and plan for next season

Assess the performance of your company last season. What went right? Concretize the reasons behind your successes to determine which strategies should be continued. Do the same exercise on the things that could’ve gone better. Were there situations that could’ve been handled differently? Again, nail down the reasons why. Take notes, so you’ll know what to avoid when business starts to pick up.

Some of the things you can look into include:

Inventory – Which items were flying off the shelves? Which ones were snubbed by customers? Should you introduce new products? Itemize, evaluate, and then stock up accordingly.

Staffing – Did you have enough hands on deck to handle customers during the busy months? Did any of your staff members shine or underperform? Take note so you know who to hire next time around.

Suppliers – How much did you spend on supplies and services? Could you have gotten a better deal elsewhere? Use the off-season to do research on vendors, so you can switch or re-negotiate better contracts for next season.

Maintenance– Is your store still in good shape? Are there any maintenance or renovation issues that you need the address? Take care of them when your business isn’t too busy.

Bottom line

Your business may be seasonal, but your commitment to it shouldn’t be. Put these tips into action and find ways to thrive all year round.

For this reason, multiple tools have been created to help companies to measure their levels of customer satisfaction. This article examines the pros and cons of three of these tools: the Customer Satisfaction Score (CSAT), the Customer Effort Score (CES) and the Net Promoter Score (NPS).

The Customer Satisfaction Score

The CSAT is the “traditional” method for measuring customer satisfaction – the tool allows you to measure how products and services supplied by your company meet or surpass customer expectation.

The survey works by allowing customers to express his/her satisfaction for a certain topic on a score from 1-5. You can create your own survey or use a provided template, follow your customer satisfaction levels and get results in real-time. This tool is an excellent way to identify what your company is doing right, and for revealing areas for improvement.

Once you have collected this information, you can implement follow-up surveys in your organisation to improve your Customer Satisfaction Score.

The Customer Effort Score

The CES tool was created based on research by CEB (creators of the CES) is the extent to which the customer has to put in effort when interacting with your company can either increase or decrease their satisfaction levels.

According to the research conducted by CEB, “Service organisations create loyal customers primarily by reducing customer effort – that is, by helping them solve their problems quickly and easily – not by delighting them in service interactions.”

On this basis, the CES includes two key questions to measure satisfaction. The first is “How much effort did you personally have to put forth to handle your request?” on a 5-point scale from very low effort (1) to very high effort (5).

The second version of the question is a disagreement/agreement rating question: “The organisation made it easy for me to handle my issue.”

The Net Promoter Score

Lastly, in 2003 the NPS tool was introduced as a tool for measuring customer satisfaction. The NPS focuses on measuring long-term happiness and customer loyalty. NPS is claimed to be a better predictor of customer behaviour than CSAT, and strongly correlated with measures of company growth.

The NPS assesses to what extent a respondent would recommend a certain company, product or service to his friends, relatives or colleagues. The idea is simple: if you like using a certain product or doing business with a particular company, you like to share this experience with others. Specifically, the respondent is asked the following “ultimate” question: “How likely are you to recommend company/brand/product X to a friend/colleague/relative?”

Customers are given the option to answer this question on an 11-point rating scale, ranging from 0 (not at all likely) to 10 (extremely likely).

This type of tool is useful because it gives your organisation an unambiguous number that is easy to understand for all employees and useful as input for managers to steer the company.

During 2017, I presented to 150 accountants at our first Transform! Conference (held in Wellington) and many hundreds more at Transform! Breakfasts in cities across the world, including London, San Francisco, and Sydney. These events challenged, energised and engaged accountants and advisors to focus more on proactive, game-changing service provision for their clients to achieve greater satisfaction and reward for all.

Specifically, I challenged accountants to get strategy at the heart of their business model. Firstly, to have a compelling strategy of their own that is resourced and executed with purpose. Secondly, to offer strategic planning guidance and mentoring to their best clients.

Surprisingly, few accounting firms have a strategic plan or a robust planning process. Even the progressive, cloud-based firms that attended our Transform! events in 2017, for the most part looked sheepish when I asked if they had an up-to-date, comprehensive strategy. A majority of attendees admitted they had no codified strategy at all.

Changing this situation should be a top firm priority in 2018!

Process Creates the Plan

Getting strategy at the heart of your success in 2018 will require you to carve out some time, get a process started, and shake things up. There’s no better time to review and tweak your business model, future-proof compelling services, and to get your strategic building blocks in place.

Just as every good strategy has key elements, every good plan needs a step-by-step process. In fact, I think the process is often just as important as the plan itself. I heartily recommend a strategic planning retreat with your core team – find a beach, lake, or vineyard, incorporate some intellectual lubrication and set an agenda.

The key elements in a good strategy normally incorporate:

1. Vision

2. Values

3. Objectives – short term, long term

4. KPI’s

5. Actions

6. Owners

7. Deadlines.

It doesn’t need to be much more complicated than that, but do invest the time and effort in doing this right. A proactive, value-add strategic model will need fresh thinking, debate, research, and late night conversations. Enjoy and embrace the process and you should end up with a good outcome.

Sharing the Strategic Love

As you and your firm deepens its own exposure to strategic planning, the opportunity to lead clients on their strategy formulation will almost inevitably follow. You want your clients to be as successful as possible too, so suggest that they undertake strategic planning as part of their calendar of activity.

Great planning requires a guide, facilitator, and/or professional expertise to be as robust as possible. If your clients are undertaking planning, you should be that guide.

Strategic planning helps businesses set direction and priorities – it is high value advisory work. Your involvement is a chance to add value and reset expectations. The more value you are perceived to have added should translate into valuable work and spin-off projects downstream.

Putting strategy at the heart of your 2018 business activity should not only give your firm greater direction and focus, but lead to stimulating, profitable fee opportunities too. It’s time to get started!

This article outlines some common inventory management mistakes to avoid, from hiring unqualified employees to conducting inventory tasks manually. Adopting some of the alternative methods in this article will help managers to increase efficiency and productivity.

Failing to Track Performance

Keeping track of performance standards can be a difficult task to achieve, especially for larger companies with multiple warehouses. For this reason, many manufacturing businesses may neglect keeping track of key performance areas like customer service, inventory turns and warehouse efficiency.

Doing so can wreak havoc for your inventory control procedures, so managers need to identify the best means to keep track of these key performance indicators. One convenient way to do this is by downloading inventory software, which will put this information right at your fingertips. Another way to track performance is by initiating mandatory tracking of fill rate and inventory turns for all products. These are two metrics that managers should be tracking as well as improving for better inventory control practices.

Hiring the Wrong People for Inventory Management

Another common inventory management mistake that businesses make is hiring unqualified employees to carry out inventory management tasks. While training new staff in inventory processes can be time-consuming, it is not a good idea to neglect this process, as untrained staff can end up making mistakes and reducing productivity.

Managers should hire professional inventory managers or people who have a solid background with inventory management to ensure the smooth running of inventory control processes. It is also advisable that inventory managers are easy to identify so that any concerns can be quickly resolved. If you have downloaded inventory software for business purposes, it is also strongly advised that managers train staff in this technology so that they know how to use it correctly and effectively.

Employees who work from home are often more productive and happier, while businesses experience higher retention rates and employee loyalty.

There are some legal risks employers should be aware of before finalising a working from home arrangement in order to achieve better, safer outcomes for both businesses and employees.

Is Working From Home the Right Option?

Not every employee will be in the right position to have a working from home arrangement. Some key things to consider when an employee requests to work from home are:

• Is the employee involved in a lot of face-to-face work with clients? If they worked from home, would this enhance or hinder the business’ client relations?
• Is the employee required to work closely with a team on a day-to-day-basis? What communication processes would need to be implemented?
• What level of supervision or monitoring does the employee’s role require? Are they self-motivated and able to work autonomously?
• Is the employee’s home environment safe and free from distractions?

Open and consistent communication between employer and employee is key to making any arrangement successful. Employees should be able to articulate why they want flexibility and how it will enhance their productivity. Employers should set clear expectations before consenting to a working from home arrangement to ensure everyone is on the same page going forward.

The Right to Request Flexible Working Arrangements

Under the National Employment Standards, some employees are entitled to request flexible working arrangements, including working from home. Employees are eligible if they have worked for their employer for 12 months and if they are a parent or carer, have a disability, are over the age of 55 or are experiencing domestic violence.

Employers must seriously consider any request for flexible working arrangements. A request can be refused on reasonable business grounds, which could include that it would be too costly for the employer, be impractical to accommodate or would negatively impact customer service.

Work, Health & Safety Obligations Still Apply in an Employee’s Home

Employers are responsible for providing a safe workplace for their staff, whether they are working on-site or at home. Under work, health and safety legislation, an employer’s duty of care extends to wherever an employee is performing an activity that is part of their employment.

This means that if an employee physically injures themselves while working at home, it can be considered a workplace incident. Employers may be liable under a workers compensation claim.

Having a Working from Home Policy and Checklist can help to ensure an employee’s home complies with WH&S requirements.

Employers also have an obligation for their employee’s mental well-being, even if they are working from home and psychological injuries are covered by workers compensation. Stress, struggles with workload, bullying, harassment and job dissatisfaction are still issues that arise with employees who work from home. This risk can be minimised by having regular office days when the employee comes into work and checks-in with managers and other staff.

Confidential Information

If an employee is working from home, company property and intellectual property will often be put on personal computers or taken home in hard copy. This inevitably creates risks of confidential information being shared outside the business.

Employment contracts, codes of conduct and policies can assist with protecting your business’ confidential information. They can also ensure employers are able to request access to information and property (such as laptops or phones) at any time, including termination of employment.