10 Tips to Help Your Business Become More Profitable

May 7, 2016 by Annie Pilon In Finance

Every business has a different set of goals. But increasing profits is a pretty universal objective for businesses of all sizes. There are plenty of different ways to go about working toward that goal. Members of our small business community shared some simple steps you can take in the list below.

Test Your Financial Literacy

To make sure that your business is on the right track financially, you’ll need to make sure that you’re financially literate enough to make that determination. This Sageworks post includes a quiz made to test out your financial literacy so that you’ll be better equipped to make those tough decisions.

Focus on Managing Your Payroll

Payroll management is part of running a business that can sometimes get neglected. But it’s incredibly important for you to have people dedicated to managing your payroll operations and transactions, even if you have set processes in place. Hmd Ali explains more in this post for The Raymond Solutions.

Form Habits That Lead to Long Term Success

Making a quick dollar is nice. But you’ll need to think differently if you want your business to actually succeed over the long run. That means you have to form habits that can actually lead to long term success, as Martin Zwilling shares here in the Startup Professionals Musings blog. You can also see conversation surrounding the post over on BizSugar.

Avoid These Usability Mistakes That Destroy Mobile Conversion Rates

If you want your business to make money in 2016, you need to be able to convert mobile customers. That means that your site or platform needs to actually be usable for people on mobile devices. So you need to avoid the usability mistakes outlined in this post by Jeremy Smith in the Jeremy Said blog.

Convert Blog Visitors Into Customers

Having a lot of blog readers or visitors can be great for your business. But that alone won’t necessarily make you any more profitable. Instead, you can check out this post by Neil Patel and work on converting all of those blog visitors into actual paying customers.

Understand That Your Products Are Commodities

No longer are products just products. In this Kexino post, Gee Ranasinha explains why businesses now create products that are also seen as commodities to consumers. And the BizSugar community also share thoughts on the post too.

Consider Changing Your Legal Structure for Tax Year 2016

If you got hit hard by taxes this year, you might want to consider changing your business’s tax structure for the coming year. In this CorpNet post, Nellie Akalp discusses some ways you might be able to change your business’s structure so that you could benefit come tax time.

Keep Track of Your Online Reputation

You already know that your reputation is important. But it can also have an impact on your business’s bottom line. This post by Rachel Strella of Strella Social Media includes some tips for tracking and managing your online reputation. And BizSugar members comment on the post here.

Follow These Investment Tips for Beginners

Investing can be a tricky game, whether you’re personally investing what you’ve made from your business or making investments specifically to help your business grow. But this Noobpreneur post by Ivan Widjaya includes some investment tips specifically aimed at beginners.

Use These CRM Tools to Skyrocket Your Success

Any business that wants to make money needs customers — and more specifically, loyal customers. If you want to keep your customers happy and engaged with your business, you’ll need some kind of CRM system. Apple Pineda shares some options in this post on the RightMix Marketing blog.

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22 Marketing Ideas For Small Businesses with Limited Budgets

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October 1, 2014    Megan Marrs

Don’t have many bucks to spend on your biz? No worries – there are plenty of marketing tactics you can make use of that won’t blow your small marketing budget. Let’s see how far you can stretch those dollars! Here are 20+ marketing ideas for small businesses working on a small budget.

1. Publish Great Content. I don’t think I even need to say this, but it’d be neglectful not to mention the importance of kick-ass content. If you can create it yourself, all the better (isn’t free always better?). Even if writing isn’t your strong point, you shouldn’t have too much trouble getting someone on your team to crank out some articles for your blog. Try top 10 lists, tip collections, best practices for your industry, etc. I shared a bunch of creative content marketing ideas here, and Elisa recently rewrote the rules of content marketing for small businesses.

2. Create Instructional Videos. Video content is really valuable, and while it can cost big bucks to get professional YouTube videos produced, there’s nothing wrong with giving it a shot yourself or hiring a film student off Craigslist. Wistia offers a great video tutorial showing you how to shoot expert-looking footage on your regular old iPhone!

If video sounds like too much of a challenge, try making slide decks and sharing them on SlideShare.

3. Get Ad Promo Credits. While massive ad campaigns may be out of your budget, there are often discounts and coupons floating around for paid Facebook ads or Google ads. Some web hosting services offer advertising discount codes as part of their membership offerings. Check and see if yours does.

4. Reddit. Reddit, a bare-bones social network self-titled as the “front page of the internet,” can be a powerful tool when used strategically. Reddit is composed of a very tech-savvy audience that bristles at any obvious marketing tactics.

To win at Reddit, share only truly awesome content, and post only to extreme niches. In Reddit, there are subcategories (known as subreddits) that deal with some of the narrowest, most specific interests in existence. There’s a subreddit for lockpicking (/r/lockpicking ), a subreddit for unicycles (/r/unicycling), and there’s even a subreddit for admiring beautiful handwriting (r/PenmanshipPorn). (And of course there’s one for SEO.) Find your niche and dominate.

5. Be a Savvy Social Networker. Create business accounts and participate in the big social media sites – Facebook, Twitter, LinkedIn, Google+, and Pinterest. Add Instagram in there too if your business is image-oriented. Also check out this list of easy Facebook marketing ideas for any type of business.

6. Stumble Upon Advertising. If you want to try some paid advertising but you’re not looking to break the bank, Stumle Upon’s Paid Search Discovery could be for you. Paid Discovery delivers users straight to your site, ready to engage. What works best on Stumble Upon? Photography, visual assets, and humorous content.

Stumble Upon is pretty cheap compared to other paid ad structures. You start with a base price of 10 cents per click, then add +2 cents for age targeting, gender targeting and device targeting. You can see the whole price list for detailed info.  Whichever way you spin it, Stumble Upon’s paid offering is leagues cheaper than most other social media ads; Facebook ads, for example, can cost as much as 80 cents per click.

To really benefit from Stumble Upon, use targeting options to make sure you’re hitting the right audiences and niches.

7. DIY Infographics. Infographics are insanely powerful marketing tools. They’re visual eye candy, they’re easy to digest, and people love to share them, so they’re a great way to drive up referral traffic and links. Hiring a designer to make you an A+ infographic can hit your wallet hard, but you can make your own on the cheap if you don’t mind a bit of a challenge.

Check out our collection of free infographic templates that you can customize from within PowerPoint, no design skills required.  If you have some understanding of Adobe Illustrator, try out these free vector kits that provide all the elements needed to make a stunning infographic. Not sure where to start? Check out Visual.ly for inspiration. They have beginner and advanced examples for you to browse through.

8. Give New Life to Old Data. If your marketing budget it tight, you might not be able to always afford content writers to whip up content for your blog. If you’re in a dry spell, instead of making something new, breathe new life into something that already exists on the web. There are a ton of data studies and stats available on the internet. While some of these studies may get initial traction, many often go unnoticed.

Find a study that relates to your industry and polish it up. Highlight the most important or interesting parts of the study, add images, crank out some charts, and make your own thoughts and predictions based on the data.

You don’t need to be a master writer for this strategy – the data will do most of the heavy lifting for you. One man’s throwaway data is another man’s content success story! Just be sure to cite your sources and give credit where it’s due.

For government data, check out data.gov or The Census Bureau. Global statistics can be found through UNICEF and the World Health Organization. Ultimately, you’ll have to find source data that relates to your industry and audience interests.

9. Lounge About on LinkedIn. LinkedIn is a major social media site that is often under-utilized. Don’t just add network connections and sign out – join groups, enter into dialogue with connections, and share your blog posts. There’s a ton happening on LinkedIn, and it can be a great place to promote your content, share ideas, and build your brand. Larry recently shared some tips for getting more LinkedIn connections, and here are some ways to spruce up your LinkedIn profile if you’re a recent college grad.

10. Recycle Your Content. Just as you can re-purpose existing data studies, you can rehash your old content into new creations as well! Turn a webinar into a video tutorial. Transform a collection of blog posts into an ebook. Never be afraid to mash-up your old content – chances are there will be a ton of people who never even saw your old stuff, so it’ll be a fresh, 100% new content piece for a large segment of your audience.

11. Develop a Customer Referral Program. Offer existing customers a free product, free month of service, or some other reward for referring new customers. Remember, word-of-mouth is powerful stuff, so friends telling friends about your business is incredibly valuable.

12. Online Contests. You’ll need to cough up some dough for a prize, but the number of participants and new potential leads you get will be well worth the price. Really tight on budget? You don’t technically need a super expensive prize to get participants. Even a couple high-end water bottles or fancy backpacks might be enough of a draw for some users.

Not sure how to host a contest? Go with Rafflecopter – they make it super easy to set up a contest and embed the contest entry form on your website.

13. Industry Partnerships. Team up with a business related to your industry (but not a direct competitor) for a joint project. This can be done locally offline through some kind of special event, or online with a webinar or promotional giveaway.

Partnering with another business means twice as much notice. If you’re partnering with an industry-relevant business, you’re getting introduced to a whole new audience related to your niche. People pay big money for that kind of access! 

14. Apply Online for Business Awards. Most industries have business awards you can win, providing you with an online badge you can place on your website. Badges like these can boost credibility, and as a result, increase sales.

If there aren’t any awards for your industry, host your own! You’ll get a ton of attention from other industry businesses who want to apply for your award, which means even more connections and more possible future collaborations!

Local Marketing Ideas for Limited Budgets

Local marketing can often be less expensive than massive online campaigns. Your reach is smaller, but if your business is regional, there’s no better (or cheaper) way to build your business.

15. Awesome Business Cards. Get yourself some snazzy business cards, then give them to every person you lay eyes on.  Every handshake should come with a business card. The more people who find out about your business, the better – even if it’s just a quick glance at a business card.

(from flickr user jnyemb)

16. Guerilla Marketing. Guerilla marketing emphasizes creativity over budget, and strategies are often cheap and easy to implement, especially when localized. Broadcast your Twitter handle with sidewalk chalk, use an abandoned storefront as a canvas for street art, or plaster custom stickers on urban décor that makes those who stroll by look twice. There’s a ton of room for invention here, and you don’t need a big budget to be successful. We did a massive post about guerilla marketing recently, detailing a bunch of strategies and examples you should check out if you want to learn more!

17. Host an Event or Class. Plan an event or class to host, then print out flyers and post them on community bulletin boards (libraries, coffee shops, local colleges and adult ed centers). While most community bulletin boards won’t let you post business advertisements, they’re often more than happy to post a flyer promoting an educational event or class. 

18. Business Card Drawing. Put a fishbowl at your place of business with a sign asking visitors to drop their business cards in for a chance to win something from you (for example, a restaurant might offer a free pizza party).

At the end of the month you’ve collected a ton of business cards, and while you can only have one winner, there’s no reason those other business cards have to go to waste. Use the email addresses provided to let users know that while they haven’t won this time, they are more than welcome to join your mailing list, which will notify them of future giveaways and special offers.

Check out 24 more restaurant marketing ideas here.

19. Email Marketing. Email marketing is a great way to get new visitors engaged with your business, as well as maintain relationships with your existing customers.

Get new website visitors to sign up for your newsletter by offering a bonus content piece for subscribing (e.g. get your free ebook detailing how to make a homemade pizza when you sign up for our First Slice newsletter). Slowly nurture your subscribers via email until they are ready to become paying customers. Start your email campaigns with a free email marketing service like MailChimp.

20. Car Magnets for the Company Car. Slap a magnetic sign on your company car to build brand awareness as you drive around town (just be sure to obey traffic laws). Bumper stickers and window decals work as well!

21. Give Away Balloons at Local Events. Get a few hundred custom balloons printed with your business name, rent a helium tank, and watch the smiles roll in.

(balloons = happiness)

Kids love balloons. Adults love them too, but are embarrassed to admit it. Stop the shame – balloons and bubbles will always be awesome, it’s OK to say so. You’ll have a bunch of happy people marching around with your brand floating above their heads, all for less than $200.

22. Join in on Local Contests. Consider donating a product or service of yours as a prize in a local contest or event.

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How to prepare for new accounting rules on revenue

By: Denise Bendele, Contributing Writer | Jun 3, 2016, 7:15am EDT

Accounting rules changes have an insidious way of affecting companies far beyond their accounting departments. The new standard for revenue recognition is just the latest example.

That’s why company leaders would be wise to start planning now for the new standard that becomes effective for years beginning after Dec. 15, 2017 for public companies and Dec. 15, 2018 for private companies (calendar year 2018 for public companies and calendar year 2019 for private companies).

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Companies should get started soon evaluating all of their revenue sources and contracts.…more

IMAGE PROVIDED BY GETTY IMAGES

The new standard from the Financial Accounting Standards Board (FASB) is a consolidation of all industry guidance on revenue recognition. The standard deals with revenue from contracts with customers — in short, how, when and how much revenue should be recorded as revenue.

If that sounds like accounting mumbo jumbo, consider a few areas where this change could affect your company:

• Human resources — If you have employees who receive bonuses based on company revenues or other financial metrics, their bonuses could be impacted.
• Sales — If you come up with new contract terms for your customers, accounting for revenues could be affected.
• Information technology — How and when your systems record revenue might need updating.
• Investors — If your company is publicly traded, shareholders will need to be informed about how the changes will affect the company’s financials.

Starting to grasp the ripple effect?

Companies should get started soon evaluating all of their revenue sources and contracts. They should start assessing the impact to their budgets. And they should begin to identify how the new standards will impact their organizations.

By project managing the various ways the changes will affect your business, you’ll be better prepared to implement the new standards when the deadline approaches. Yes, your chief financial officer or outside accounting lead should be on the project management team. But so should all of the administrative and operational departments of the company.

Starting this project now will make the transition smoother than if you delay.

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Is it the Best Time to Sell my SW Florida Business?

You’ve probably thought about selling your business, but you also know you don’t have to sell it today. After all, you’ve worked hard for many years to build the value of your business. Sure you want to spend more time with family, friends and perhaps even feel the urge to travel more, while you’re still young enough to enjoy it. But not at the cost of leaving money on the table, particularly because your business is doing so well right now. You’ve rebounded since the recession, profits are high and work continues to pour in. You, the strong, have survived and endured the challenges the economy brought to Southwest Florida in the late 2000’s and beyond. Now it’s time to capitalize and recapture that money you had to put into the business to stay alive. Just a few more years and you’ll be ready. 

So, why now?

We can’t answer that question for you from the personal point of view, you and your family have to make that decision. But, we can offer some insight into the market and what current conditions are like – and the conditions appear to be extremely favorable to business sellers. History has taught us, the best time to sell anything is when there is high demand and low supply: a seller’s market.

Over the last several years, many business owners who have considered selling have held off because of the recession, or in some cases, their rebound from the recession. That trend hasn’t really changed much in 2015 and looks like it will continue into 2016. Therefore, Buyers that truly want to buy, have had thin pickings. This has created a HUGE BACKLOG OF BUYERS, private equity funds and companies searching for business opportunities to purchase. Sounds like a pitch doesn’t it? If you won’t take my word for it, I encourage you to do some research, you’ll be happy you did!! It’s true, individual buyers, private equity funds and companies have been flush with cash and are ready to spend, but only on opportunities that make sense. The same can be said about lenders, who need to make deals to stay in business, we continually sit down with lenders and their representatives expressing the need to write loans. We give them what we can, unfortunately a major problem has been, there are limited businesses available that will qualify! The Small Business Administration (SBA) recently increased its ceiling for business purchase loans and most of their approved lenders are streamlining the approval process. Low interest rates also make it affordable by lowering the debt-service payments and putting more cash back into the business, which is what buyers are after to begin with.

Another reason to consider now, rather than later - Baby Boomers!! It has been discussed for years, the Baby Boomer generation is poised to put their retirement plans into action. With the recent recession, the Boomers may have pushed their plans back a bit, so most have not come to market yet. Many Boomers own quality businesses that they, much like you, have spent years developing and will be soon be ready to take those businesses to market. When that happens, the buyer-to-seller ratio is very much poised to shift. When? No telling, but given that the selling cycle for a business can range between 8 months to over 1 year, delaying could have an impact in the selling value for your quality business.

If you believe the timing may right and would like to have a confidential conversation on how to prepare your business to be sold, feel free to contact Dan Smith at (239) 207-1632 or dan@cibb.net | www.swflbiz4sale.com  

Preparing Your Southwest Florida Business for Sale

Getting your business ready for sale can improve pricing and reduce the time to complete a transaction, but there are two other compelling reasons to begin grooming your business:

·         Most of the steps you will take are, in fact, good business practice.

·         You never know when the opportunity for a sale might arise, either because of ill health or injury, or because an offer comes along that is too good to pass up.

Preparing your business for sale can take time, which means that you need to get started well in advance. Your reward is a feeling of confidence that you can seize the interest of more qualified buyers quickly, and possibly get a better price. You will also know that you are passing on the business in the best possible condition.

 Could Your Business Be Sold Today?

To best determine whether this question can be answered right off the bat, the following steps and questions may help you assess certain factors buyers may consider when evaluating the worth of your business.

Assess the condition of your business as a sale prospect:

-          Do you have the past 3 years of sales and profit history organized and properly 

        documented?

-          Over the past 3 years, have sales and profits consistently increased?

-          Have costs and operating expenses increased only at a rate consistent with 

        revenue increases?

-          Do the assets of your business exceed the liabilities of your business?

-          Is your business able to consistently cover its costs and expenses from the 

        sales revenue?

-          If your business success is reliant on its location, is it covered by a long-term 

        and transferable

        lease?

-          Does your business have modern facilities and equipment?

-          Other than yourself, does your business have a staff that customers or clients 

        know and trust, 

        which can provide continuity after your departure?

-          Do you have key staff members in place and secured to ensure a smooth 

        transition? 

What is Your Business Worth?

Whether you have determined that your business can be sold today or are in the exit planning stage, it may prove beneficial to discover what your business could potentially be worth by starting with a business valuation and analysis. 

A business valuation involves many variables (and many of them are subjective) that often means various “experts” looking at the same company can formulate different recommendations. However, many small to medium- sized companies are sold for prices expressed as a multiple of cash flow or earnings. Each industry has a “rule of thumb” and an expected multiple that buyers expect to pay. If the business’s current financial picture doesn’t match a buyer’s expectations, one or the other has to be adjusted. 

Today’s combination of low interest rates, capital market liquidity and significant pools of private equity and debt are driving a high level of business sales and B2B acquisition activity. This can be a great opportunity for business owners. The competition for quality deals is intense, putting upward pressure on business valuations. 

Define Your Motivation and Objective

One of the first questions a buyer will ask is about motivation to sell. You need to be able to articulate your motivation; red flags are raised if the answer seems ambiguous and unsure. This is why it’s better to sell when times are good rather than the alternative.

·      Your Motivation:

-          You’re bored

-          You feel burned out

-          You want or need to move to a different geographic area

-          Personal changes in your life

-          Your business would benefit from increased investment and energy

-          Partner disputes

-          Divestiture

-          Retirement

-          Other interests

Your values can help guide you in setting your objectives. Take some time to think these through, perhaps discuss with your professional advisors, and come up with reasonable expectations. 

·         Your Objectives:

                                                                                                                                

 -          Maximizing the total value received for your business

 -          Maximizing the cash received on closing of the transaction

 -          Immediately transfer ownership and walk away from the business

 -          Transition ownership over a specified period of time (usually 3 to 12 months)

 -          Define your after-sale interests to help design a sale approach

 -          Preserving the well-being of existing employees, customers and supplier

 -          Remain with the company at the managerial helm post-closing

Get Your Books in Order

Prospective buyers will want to see at least three years of financial statements, including balance sheets and income statements. You will need to be able to document your business’s true profitability by identifying nonoperational expenses. Sellers need to quantify and substantiate these items because buyers purchasing a business are really buying its profitability. Ideally, business records should be separate from personal records. If your expenses are a bit tangled, it will be greatly beneficial to separate and create a financial profile history for just the business.

Be Sure All Legal Commitments are in Order

Understanding permits, leases, licenses, client and vendor contracts and how each impacts your business is essential in the selling process. For example, if the business location is key to its performance, a long-term lease with options at or below fair market value would be appealing to a buyer. 

Understand Tax Implications

You will be taxed on the profit you make from selling the business. You may be able to control the timing through the terms of the deal, but the IRS will take its share at some point. The amount of tax you will ultimately have to pay depends upon whether the money you make from the sale is taxed as ordinary income or capital gains. Allocation of Sales Price Governs Tax Consequences. There are a number of qualifications to the rules, and issues that present planning opportunities for sellers of businesses.

·         Here are some that frequently come up:

-          Ordinary income vs. capital gains

-          Installment sales

-          Double taxation of corporations
-       Tax-free reorganizations 

Can Your Business Be Operated by Someone Else? Some businesses cannot survive without the owners trying to do everything themselves; and they have NO key employees to help manage the operations. Even though you may have a stable of loyal customers and great reputation in your specialty, buyers may be concerned whether they themselves can replace the skills and experience of the owner. If you are absolutely vital to the business, efforts should be made to gradually delegate key responsibilities to various staff members. While not every business can be successfully operated by “any buyer”, buyers want a business that can thrive whether you’re at the helm or they are.

Polish Your Business with the Prospective Buyer in Mind: When grooming your business for sale, consider it through the eyes of a prospective purchaser. This will help you show your business in the best light possible. The decision to sell your business will be driven by your personal and financial objectives. However, it’s good business sense to recognize that life and business are unpredictable and that events and opportunities may mean you find yourself pursuing a sale earlier than you had planned. The investment you make in planning will be well worthwhile and give you the peace of mind of knowing that you are able to respond to events quickly and from a position of strength.

For more information on selling a Southwest Florida business, businesses for sale, acquisition 

opportunities and business valuations; contact Florida Business Broker Dan Smith at dan@sellbusinessfl.com or 239.207.1632 for a free consultation. Visit our Corporate Investment Business Brokers website at www.floridabusinessbrokers.com or my personal website atwww.swflbiz4sale.com.