business growth Archives - Page 11 of 17

How to Boost Your Employees’ Productivity Levels

As a small business owner, there are many things about your business that are in your control, and some that aren’t. How would you classify your employees’ productivity levels – as something you have control over? Or do you often feel like you’re at the mercy of outside forces when it comes to your employees working up to their potentials? It doesn’t have to be that way! And it doesn’t require raises or big gifts to get your employees producing more, higher quality work. All it takes is some good old fashioned people management skills, which we know you’ve got in spades!

What’s Holding Your Employees Back?

One important thing to remember is that employee productivity is not just about quantity, it’s also about quality. But before you can find that sweet spot of employees producing a lot of high quality work, you have to understand that many people these days can feel distracted and unmotivated at work. That’s understandable: we’re living (and working) in a world that is constantly connected and filled with distractions. Even the ability to have meetings anytime, anywhere can be an issue when it comes to productivity. In addition, many people now spend more time working than they do sleeping, making for a frustrating lack of work-life balance.Think about the following stats:

70% of workers admit to feeling distracted while working, with 16% saying they’re almost always distracted
The average employee is interrupted from their work 56 times a day, and spends an average of two hours a day recovering from interruptions!
60% of workers say they view meetings as another interruption to their day

66% of people say they would be better, more productive employees if they got more sleep

1 million workers miss work each day due to stress, with 31% feeling high levels of stress at work

61% of workers report being burnt out at their job

40% of employees say they would put more effort into their work if that effort was recognized more often

89% of workers prefer to work alone to hit their maximum productivity

Happy people are 12% more productive
Employees who feel that their voice is heard at work are 4.6 times more likely to perform at their best
A highly engaged workforce is likely to outperform companies with less engaged workforces by 202%!

The above numbers might be eye-opening. It seems that employees are more likely to be distracted or stressed than they are to be engaged and feel heard – and that could be a huge problem for your business. But consider the positive numbers above, and know that there are ways to get your employees happier, more empowered, and more engaged so that you can see your productivity levels soar.

What It Means to Be Productive – and How to Get There

What does productivity mean in terms of your business? There are three criteria your team should be meeting:

They get their work through all their work, generally meet all their deadlines, and don’t spend too much time on any one task.
You are pleased with the quality of their work – it should at least meet, if not exceed, your expectations.
Their time and efforts are spent in the right way, and not wasted on the little things.

young african american woman smiling with a laptop in front of her. — *Make your employees feel respected and heard in order to boost productivity levels.*

To get your team to this point, try the following strategies:

Make sure employees feel respected and understood – You need to understand your employees in more ways than one. Of course, you need to know their skill sets and match them to their tasks in order for them to be as productive as possible, but you also need to understand their motivations – what brings them to work everyday and what they need to feel supported. Let them know you see them, and that you respect their work and have their backs, no matter what.

Set clear, focused goals and expectations – Your employees can’t be efficient if they’re not working toward a clear goal. And not only do goals need to be clearly defined, they also need to be achievable in order for your employees to stay on track and be productive. Try the S.M.A.R.T. goals method: set goals that are specific, measurable, attainable, realistic, and timely, and you’ll see an increase in focus and efficiency.

In addition, it’s important to remember that all tasks should be as clearly and narrowly defined as possible for your team so that you don’t lose time on the little things. For example, you might think it goes without saying that you want everyone to proofread their work, but they might assume that you’re going to do it because you’ve asked for final review of the project. Always be clear about what’s important to you.

Cut back on the extras – On the other hand, if there are things that aren’t so important to you, try to trim that excess work back, so your employees can focus on higher priority tasks. Look at any tasks that they do as a mere formality and see if they can’t be scaled down or eliminated all together. Daily reports, for example, can be streamlined, or the number of people they need to get approval from for certain tasks could be reduced.

Stop micromanaging – We get it, your business is your baby, but if you have trouble delegating and being a coach on the sidelines sometimes, you’re going to end up with lower productivity, despite your best efforts to stay on top of every little thing. You’ll end up stifling your employees and hurting morale, and, not only that, but you’ll end up being less productive. You can’t be effective in your role as leader if you’re so involved in everyone else’s job; you’ll just end up creating a bottleneck and slowing everyone down.

Listen, listen, listen! – There’s more to managing your team than sending explanatory emails or giving a talk before they embark on a new task. Listening is incredibly important, too! Remember, your employees are often the ones on the frontlines, and they will have valuable input about improving day-to-day issues. And not only will you get good ideas about how to make things run more efficiently, but your employees will also feel like they are truly part of the team, and are actively contributing to the company. This will make them more engaged and, ultimately, more productive.
When you do conduct a meeting, make sure it is as productive as possible.

Think about how you communicate – According to a McKinsey study, emails can take up nearly 28% of an employee’s time. In fact, email was revealed to be the second most time-consuming activity for workers (after their job-specific tasks). Think about whether you’re matching the communication with the method. Instead of an hours or days-long back and forth for some things, try a quick phone call or meeting. But…

Have more productive meetings – Remember, meetings can also be a major productivity killer. Think about this: most meetings last 30 – 60 minutes, and most employees say that at least a third of those meetings feel like wasted time. That’s 10 -20 minutes a meeting, 20 – 40 minutes a week if you hold just two meetings, and 1,000 – 2,000 hours a year! We understand, meetings are important, just make sure:

- - You REALLY need to meet in person (or over Zoom)
  - There is a clear agenda
  - You invite only team members who really need to attend
  - To keep it short
  - To have clear next steps

Celebrate successes – Nothing motivates employees like a genuine, heartfelt “thank you” for all the work that they do, and true appreciation for the things they achieve, all in the name of your business. You can choose to say thank you however you’d like, including:

- Praising them both publicly and privately
- Rewarding them monetarily, whether it be with a gift card or a bonus
- Rewarding them with a non-monetary treat, like half-day Fridays, “lazy Mondays,” or more PTO
- Donating to a charity of their choice
- Sending hand-written notes
- Implementing a wellness program as a thank you to the whole team, and as a way to keep them healthy, happy, and incentivized

You can get creative with your thank you’s – just don’t forget to offer them!

Train and retrain – One place where you shouldn’t skimp on the extra time, effort, and money? Training and retraining your employees. Instead of throwing employees into their job to learn as they go (which will only end up with you having to go back and spend extra time correcting mistakes and reiterating what you want from them – remember those clear expectations?), take that extra day or two to get them fully up to speed. Not only will they be more efficient employees, but by improving their skills and knowledge, they will also become more confident, more effective, and more engaged.

Don’t forget to create employee development plans, allow them to retrain and learn new skills, and then offer them situations in which they can use their new knowledge. You’ll show them that you care about their future, which will go a long way towards making them feel respected and understood. It’s all connected!

Ultimately, it all comes down to the environment you create for your workforce. Whether they’re working remotely or you’re seeing them face-to-face each day, you’ve got to be there to have their backs and set the tone of their workplace. Treat your employees as valued individuals and give them the training they need and achievable, meaningful goals and you’ll be on your way to some seriously increased productivity.

As Anne M. Mulcahy, Former CEO of Xerox Corporation said, “Employees who believe that management is concerned about them as a whole person – not just an employee – are more productive, more satisfied, more fulfilled. Satisfied employees mean satisfied customers, which leads to profitability.”

Your Growth Goal Matters! How to Pick the Right One

Is growth the goal for your small business? If your answer is: “Of course!” that’s great, but you should also take a step back and think about the answers to some other questions. Questions like, “What does growth look like or mean for your business?” Or “What does success look like?” or “What is your plan for achieving your goals?” In short, having a vague goal for growth is not enough; you need to have more specific growth goals so that you can plan out things like your marketing strategy. There’s not much in life you would jump into without a plan – you wouldn’t even step up to a diving board without thinking through your next step! – so let’s look at what it means to plan ahead and have the right growth goal for your business.

Picking a Growth Goal

One of the biggest mistakes small business owners make when they’re trying to grow? Not knowing what that growth means or what it should look like for their unique business. Without a clear growth strategy, you won’t know how to focus your efforts or measure your successes (or failures). Before you sit down and map out your business growth strategy, you need to actually pick your growth goal.

While revenue might be one of the most common growth goals, it’s not necessarily going to be the right goal for every business in every situation. Your growth goal should always align with what you’re generally trying to achieve as a business. Yes, that might mean profit margin, but it could also mean increasing your subscriber base or followers, impressing investors with exponential growth in your customer base, or getting a bump in brand recognition so you can spend less on marketing and use those funds for product innovation and service expansion.

Set your growth goals around one of the following:

Revenue – Think: sales, net profit, total recurring revenue, average contract value, etc

Subscriptions – Think: monthly recurring revenue, annual recurring revenue, etc
Units – Think: total units sold/processed, customer base, new contracts, follower count, etc

Once you consider what you’re trying to grow, you’ll need think about:

How much you want to increase it by – This can really vary based on your business and your goals. It’s easy to say, “We want to increase revenue by 20%,” but things can get a little more murky when you’re thinking beyond immediate profit. For example, how would you measure growing your customer base? If your goal is simply to build your customer base, ending with one more customer than you started with is technically a success, but is that the right goal for you? If you’re a freelance photographer, gaining one major client might be all you need. But, if you sell thousands of units of a product each day, acquiring one new customer will be almost meaningless.

How you approach growing it – This can be tough, as well, because your approach might change over time, and you might switch back and forth between goals. After all, the unfortunate truth is that being laser-focused on one area of your business can mean other areas don’t perform as well – and you’ll need to be prepared to roll with those punches. For example, if you run a software-as-a-service (SaaS) business, you might want to increase your user base, so you might offer free trials or even free plans to reach that goal. But, with this strategy, you’ll get more users but not necessarily any more money. On the other hand, if you’re looking to specifically increase revenue, you can choose to switch to a premium service model to get free customers to start paying. You could make more money this way, but you could actually see your customer base decrease.

Getting Specific: Writing a Business Growth Strategy

Now that you’ve really thought about what it means for your specific business to grow, and what your unique successes would look like, you need to get specific in order to achieve your goals. That means creating a growth strategy, preferably in writing, so you can effectively (and with accountability) share it with others in your organization. Start with the following steps:

Define Your Long- and Short-Term Goals – Now that you’ve thought about all of the above, the first step is to make a record of the goals you hope to achieve – say, in the next 5 years. Write them down to keep yourself on track! When considering increasing revenue, subscriptions, or units think about making goals like:

1. - Increase sales by 15%
  - Grow organic site traffic by 35%
  - Increase subscription trial conversion rate by 2%
  - Add new product lines, expand into a new market, or open a second store

Prioritize Your Goals – Once you’ve made a list of your goals, put them in order of importance, thinking about which ones:

- Are most vital to your business’ growth
- Offer the highest ROI
- Are achievable with your current resources

Remember, too, that some goals with need to be met in a certain order, while others

could be worked on at the same time.

Figure Out Your Strategies for Meeting Your Goals – Now you need to take your goal and break down the steps you’ll need to go through to meet it. Let’s take a very concrete goal as an example: opening a new store in the next 6 months. You’ll need to take the following steps:

1. - Research a location
  - Make sure your current revenue can support the initial costs
  - Hire the necessary personnel and have a training strategy in place
  - Start marketing a grand opening

Check Out the Competition and Make Sure There’s Market Demand – Did you know that 42% of failed startups said that they failed because they overestimated market demand? Making assumptions could be devastating for your business, as could not adequately researching your competition. If you’re offering something new and innovative, it’s crucial to conduct market research to make sure there’s enough demand. If you’ve got a lot of competitors for your market, check them out thoroughly, asking questions like the following:
Focus on setting an attainable growth goal timeline.

1. - Who are your competitors and what exactly do they offer?
  - What are their pricing models?
  - What is their marketing strategy?
  - What are their customers saying about them?

Set Timelines – You need to make sure you have a set time period for achieving your highest priority goals, but you also need to know the sequence of achieving those top goals. For example, if your goal is to increase your user base by a certain amount in the next month, you might first need to work on the goal of launching a new service or create a new free trial offer to entice them.

While most small businesses are looking to grow, the specific goals and strategies for reaching those goals are going to be different for every business. It all boils down to really knowing your business and having a clear understanding of where you are and where you want to be in a specific amount of time. Doing your research, backing up your assumptions, and documenting your goals will take time and effort, but it’ll all pay off when you start reaching your growth goals!

Should You Make Working from Home Permanent?

Every passing year brings new trends in the workplace: are you old enough, for example, to remember switching over from actually walking across your workspace to speak to a colleague or employee to just instant messaging them? (Yes, people used to actually get up and do that.) And, while working from home is not a new phenomenon, most people would agree that WFH became the biggest trend of 2020, and remains so for 2021. If your small business made the hasty transition to remote work last year, how has it been for you? And do you envision ever going back to the ways things were before the pandemic hit, or are you planning to make the “new normal” just plain “normal?” It turns out, it might actually be good for your growth to stick with the work-from-home model, but before you make your decision, let’s examine the pros and cons.

young caucasian woman's back with her front facing an open laptop with zoom on the screen. — *About half of Americans are currently working from home and thriving.*

The Telecommuting Trend

Again, working from home is not a new thing. But consider this: the Brookings Institute estimates that currently up to half of all American workers are working from home. That’s more than double the number that worked from home in 2017-2018! If you are one of the many business owners who switched to a work-from-home model last year, you probably had little time to prepare for the change, and were forced to rig up a hodgepodge of apps and software to keep everyone connected. But now that you’ve had a whole year to get some breathing room (has it been that long??), you might be finding that it’s really not so bad.

If you’re kind of digging having your employees work remotely, you’re not alone. A Gartner survey of company leaders found that 80% plan to allow employees to work remotely at least part of the time after the pandemic, and 47% will allow employees to work from home full-time. In a PricewaterhouseCoopers survey of 669 CEOs, 78% agree that remote work is here to stay for the long-term.

And employees? According to one survey, 65% of employees said that they want to continue to work from home full time, and 31% said they would like to have a hybrid work environment in the future – that’s 96% of employees who say they would prefer to work from home in some capacity!

The Pros of Permanent Work from Home

The statistic above should be the first “pro” that you consider when deciding whether to make a work-from-home model permanent. Despite the inevitable quarantine-related complaints, it seems that most workers actually want to be home; in fact, 27% of workers say that the ability to work from home is so important to them that they are willing to take a 10% to 20% pay cut to work remotely. In addition, 81% say they would be more loyal to their employer if they had flexible work options.

Employee satisfaction and loyalty are definitely one big advantage to permanent remote work. Remember, those two things can go a long way towards keeping you growing: happy employees are productive employees, and loyal employees will save you the staggering costs of losing employees and finding new hires. So what other advantages are there to sticking with WFH?

graph with bars and an arrow going upwards — *Studies show that remote workers are 35 – 40% more productive.*

Higher productivity rates – Worried that employee productivity rates are ultimately going to plummet if they continue to work from home? It might not be a problem; in fact, your employees might actually become more productive. Studies show that remote workers are 35 – 40% more productive than their in-office counterparts. In addition, 94% of employers said their employees were as productive (67%) or even more productive (27%) since they started working from home during the pandemic. And employees themselves? Multiple surveys have revealed that 75 – 95% of them feel that their productivity levels have been the same or even higher since they started WFH. Need more? Remote workers averaged 27 minutes of unproductive time a day, compared to 37 minutes for in-office workers, and they worked an average of 1.4 more days every month (or 16.8 more days every year).

Big savings for you – All of that productivity can add up to a big boost to your bottom line, especially since businesses lose $600 billion dollars a year to workplace distractions. Not only that, but large business owners save $11,000 per year on each remote employee – and, while your savings as a small business owner will likely be less, you’ll still keep a good chunk of change in your pocket by switching to permanent WFH. Think savings on money-sappers like office space rent, equipment, furniture, utilities and supplies.

Bigger talent pool – Struggling to find the best hires for your small business in your area? With a remote workforce, you have access to hires from all across the country.

Collaboration does happen remotely – Sure, we’ve all heard all the jokes and complaints about endless Zoom or Slack meetings, but all of the advancement in video conferencing software means that your workforce can effectively collaborate and communicate, no matter where they are. In fact, consider this: in a recent survey of remote workers by national staffing company Robert Half, 20% of respondents said they have stronger relationships with co-workers now. Employees who are parents had an even stronger response: they are now 3 times more likely to develop deeper relationships with their co-workers.

Readiness – Let’s hope we never have to go through another crisis like the current one, but the truth is, we can never know what the future holds. Having a flexible, agile workforce and business structure means you’ll be ready for anything.

The Cons of Permanent Work from Home

Working from home permanently, though, might not be right for every employee or every business. Not everyone works well remotely, so the following could become problems:

Distractions – Yes, many workers ramp up their productivity when left to their own devices at home, but some might find it difficult to shut out the family life going on around them, or the lure of a long lunch break with Netflix.

Poor work-life balance – While many employees relish the idea of rolling out of bed, getting their work done and then unwinding at home, some might have a difficult time drawing the line between what is work time and what is home time. When those lines blur too much, distractions and poor morale can hurt productivity.

Isolation – Similarly, you might end up with less satisfied and less productive employees if they find that communication is suffering as they struggle to navigate working from home permanently. Sometimes Zoom meetings just can’t replace face-to-face collaboration; in addition, virtual hangouts and get-togethers are fine for some people some of the time, but other employees (especially young, single ones) might feel like they’re missing out on a work-based social life.

Lack of control – For you, the employer, having a remote staff means giving up some measure of control. For example, you won’t have the ability to pop down the hall and into an employee’s office to check what they’re working on. Sure, you can try out employee monitoring software, but some employees might end up feeling like a digital “big brother” is always watching them, which could also hurt morale.

The Steps Towards Making WFH Permanent

So is permanent WFH right for your business? If you find that you’re checking off more of the pro boxes, and the cons aren’t such a problem for you, then maybe it’s time to consider switching to an all, or at least part-time, remote model. If you are considering making permanent WFH your new reality, consider these steps:

Make sure you have the right communication software – Choose the right video conferencing software for your business (and it might not be Zoom!).

Establish a routine – Encourage employees to have a dedicated workspace, and set a good example by doing so yourself. Agree on set business hours, and try to be consistent with meeting times if possible. Which brings us to…

Have a clear purpose for your meetings – Zoom burnout is real. Limit video meetings if at all possible to those that are really necessary, and make sure there is a clear purpose and set agenda that everyone is on board with.

Set company policy – There’s no getting around it: you’ll have to adjust company policy – so be very clear what it expected from remote employees. But remember, you also need to…

Be flexible – Working from home has its own unique set of challenges, so be ready to roll with the punches. Sometimes technology fails or employees need a little leeway to deal with a family issue; have a clear policy for how they should communicate with you and what your expectations are, but also cut them a little slack if need be.

Finally, congratulations are in order – you’ve made it through over a year of navigating the uncharted waters of keeping your business running remotely. At first, it might have felt like an impossible task, but as time goes on, if you find that this “new normal” of WFH is working for you, then go with it. There’s plenty of evidence to suggest that it can be beneficial to your bottom line – and, think about it, you might never have to wear nice pants ever again!

Marketing Falling Flat? Try These “Magic” Words and Colors!

Today, business owners are spoiled with choices when it comes to marketing. You’ve got ways to reach your customers that people just 30 or 40 years ago couldn’t even dream of. But, while you’re focusing on all of these endless options, are you neglecting the good old fashioned nuts and bolts of advertising, like word and color choice? The key to effective marketing might not really be magic (in fact, it takes a lot of thought!), but we can help you out with some “magic” words and convincing colors to incorporate into your marketing, so you can stand out from the crowd – no tricks required!

What’s the Marketing “Magic” Word?

No, we’re not talking about “please,” although that’s an important magic word! But just like saying “please” can influence the way a person feels about a request, using the right words in your marketing can impact buying decisions. It has been proven that you can improve audience response and inspire customers to take action with the right words and phrases. These marketing words will create positive associations, and ultimately convince them that your product or service is the one that is worth a second look (and their money). Try these “magic” marketing words in your posts and ads:

Free – We’re starting off with a pretty obvious one, but we want to make sure that you never forget just how much people love free stuff. If you can offer anything at all for free to your customers, do so (but don’t trick them) – and then be sure to feature the word “free” prominently in your ad.

Complimentary – This word has a similar effect to “free,” but is a good choice if you’re looking to class things up.

You – How is this a “magic” word? Well, we’re not just talking about throwing it around in any old way, we’re talking about using it to directly address your customer, and make them feel like you are addressing them personally. After all, everyone likes to feel special.

Savings – Telling customers that they will save money with you versus the competition will always go a long way in winning their business.

Limited – File this along with any word or phrase (like flash sale, last chance, or act now) that implies your customers need to jump on your product or service, or they might miss out on a great offer.

Guaranteed – Sometimes you have to remove the risk or ease your customers’ fears, and this magic word can help give them a sense of security. You can also use the word proven to lessen the sense of risk and instill confidence.

Instant – We live in a pretty fast-paced world, where customers want instant access to everything (for example, 47% of people expect a website to load in 2 seconds!). Use this magic word to assure your customers that they won’t have to wait, thus reinforcing their buying momentum. You can also use fast or immediate to get a similar effect.

No obligation/commitment – You need to create a win/win situation for your customers, and you can do this by implying your deal is so great that they won’t want to back out – but they can if they want to.

Easy – Everybody’s got 99 problems. Tell them how your product or service can simplify their life; or, use this magic word to let them know that the process of becoming your customer is super streamlined. The easier it is to become a customer, the more likely they are to convert.

Opportunity – Similar to the above magic words that create a sense of urgency, “opportunity” also implies that what you’re offering is quick and ready for the taking, so customers who are in the know shouldn’t let it pass them by.

Exclusive – Just as addressing your customers directly can make them feel special, so too can giving them access to a deal that is meant just for them.

See/discover – Consider adding verbs to your call to action, especially ones like these that invite customers to indulge their curiosity and explore the interesting things you have to offer.

Enjoy – It doesn’t have to be all business – appeal to your customers’ “want” side instead of simply their “need” side and let them know that something really good awaits them.

Colorful Campaigns

the word marketing written in different colors — *There is psychology behind colors and people’s emotions when it comes to buying.*

Language is one thing – it’s pretty easy to understand why certain “magic” words get certain responses from customers (again, who doesn’t love free stuff?) But what about something that appeals to them on a deeper level, like color? The psychology surrounding color choice is by no means an exact science, but choosing the right color for your logo and ads can be a very important part of your marketing strategy. In fact, according to one study, 90% of snap judgements can be based on color alone.

So where do you begin when choosing colors for your brand, especially considering that there are 18 decillion colors out there (what even is a decillion?)? According to another study, the relationship of color to a brand hinges on whether or not the color is a good “fit” for the brand. For example, if you’re looking to give your brand a sense of “ruggedness,” try brown. Or, try some of these popular colors, which can influence your customers’ thinking in the following ways:

Red – Red is a powerful color, and is strongly tied to emotions that evoke a physical response. Think love, excitement, aggression or terror. If you want to get your customers’ hearts beating and get a quick response from them, red could be the way to go.

Green – Green is actually the easiest color for the eye to process. It tends to be used as a balancing color, one that can incorporate logic and emotion, and give a feeling of rest and stress relief. It’s also associated with nature, growth and health. All of this means that green tends to be used by both financial institutions and companies that want to be seen as environmentally friendly.

Yellow – While green is easiest to process, yellow is the easiest color to see, so you can use it to grab customers’ attention. Yellow is also associated with “sunniness,” or optimism, and is a great way to make your customers feel inspired or to lift their spirits.

Blue – Did you know that blue is the most popular color in the world? It is soothing, reliable, dependable, and trustworthy. Unlike red, which will get a physical response from viewers, blue tends to evoke a more mental reaction.

Orange – Since orange is a mix of red and yellow, it tends to have some of the power of red, tempered with the fun and friendliness of yellow. It’s definitely an attention grabber, so can be used as a motivational color. Interestingly, it’s also associated with affordability. You might want to use it sparingly if you are aiming your advertising toward women, though: it is the most unpopular color with them.

Black – Just as powerful as red, but in a different way, black is a color to use sparingly, but to really great effect. Use it to add sophistication, seriousness or a sense of independence.

White – Using white is actually a pretty bold choice, but it can be effective – think Apple products and the clean, modern feeling they give off. It is also associated with purity, innocence, and peace.

Does effective marketing contain a touch of magic? Maybe. Hitting on that perfect combination of word and color choice can seem pretty magical, especially when you start reaping the rewards of your advertising efforts, and your business starts to grow. So get out there and work that marketing magic!

Need a Cash Infusion? Your Guide to Small Business Loans

When running a small business, you’re looking after every penny, and unfortunately you don’t always have extra working capital at your fingertips. But you want to grow and be able to jump on any new ideas or chances that come your way. Well, then it might be time to start thinking about applying for a small business loan. While you might be thinking the words “monthly payments,” “interest,” and “nope” when you see the word “loan,” hear us out. There are many, many options for business loans, and the infusion of cash that they provide could boost your business enough to offset the monthly payments and interest charged. The first step is understanding how small business loans work and what options are available to you, so you can decide whether applying for one might be right for you.

What Is a Small Business Loan?

“Small business loan” is actually a pretty broad category. It can be any type of financing offered to a company by all sorts of lenders or providers. As with most loans, lenders provide you with capital in exchange for interest, and usually require you to make repayments on a set schedule. But that most basic of definitions is pretty much the only constant in all small business loans. Every type of lender is different, and every loan will have different fees, repayment terms, and interest rates. You and your business – your credit history, years in business, existing debt, etc – will also be a big factor in determining what type of loan with what terms you can get, so let’s look at when might be right for you to apply for a loan, as well as the best type of loan for you.

Timing Is Everything

First things first. Is it the right time for you to be thinking about a small business loan? Do you need capital to grow your business? That’s usually an easy question! But remember, you’ve got to answer it with more than just a resounding “yes!’; you’re going to need a business plan detailing what exactly you’re going to use the money for. Identify your specific goals for the extra cash, which could include:

illustration of a woman in a suit with both hands up with one hand holding up gold coins, and the other holding up a clock. — *You have to consider how many years you’ve been in business as well as how much you have made each year.*

Expanding into new markets

Improving a product or service

Opening a new location

Hiring more staff

So you might be ready for the money, but are lenders ready to give it to you? The timing will only be right if you meet or exceed certain criteria. Lenders will look at:

Credit score – Lenders will first look at your personal, as well as your business, credit score when determining whether to lend to you. You should have a minimum credit score of above 680, though above 700 is better (and 800 is excellent!) If you’re worried about your credit score, spend some time working on it by paying your bills on time, paying off debt, and keeping balances low on credit cards and other revolving credit. Also, refrain from applying for too much credit, as this can bring your score down.

How many years you’ve been in business – Most lenders want to see that you’ve been in business for at least a year; some will require a 2-year history.

Annual revenue – If you’re going the traditional lender route, then you’ll most likely need to show that you have a minimum annual revenue, usually between $50,000 and $250,000. If this is a problem for you, and you’re not looking for a big loan, you might want to look into microlenders, who offer short-term loans as low as $2,500.

Ability to make payments – This is important to lenders and to you. You’ll have to have a specific amount of money you’d like to borrow when you apply, so carefully choose an amount that will help you achieve your goals but that you can realistically pay back.

Types of Lenders

When it comes to who lends you money, you have options. Think about what kind of loan you’re looking for, as well as how well you fit the above criteria, and look into the following types of lenders: a building with pillars on both sides and a money symbol over the door.

Big banks – Large commercial banks have the strictest requirements for loans, but they can offer larger loans with lower interest rates. Best for more established businesses with good credit, who are looking for a bigger infusion of cash.

Direct online lenders – There’s nothing easier than hopping online and applying for a quick small business loan, but convenience can come at a cost: these loans tend to be more expensive. Best for businesses that may be having trouble getting a loan from a large commercial bank, and that need cash quickly.

Community Banks – These banks are locally owned and operated, and tend to be smaller than commercial banks. Best for businesses that are looking for more individualized service, and that may have a solid history but not the best credit score, since community banks tend to be able to look at your entire credit report and other aspects of your business.

Peer-to-peer lending sites – P2P lending site acts as the middleman between you (the borrower) and a group of investors. They match your loan request with investors’ funds, and the investors get the interest you pay on the loan minus the site’s fee. Best for businesses that need a loan that is easier to qualify for, and that don’t mind paying more in interest.

Types of Loans

Just as you have choices when it comes to types of lenders, you also have choices when it comes to types of loans. You don’t have to go the traditional lender route, but always be aware of the risks of alternative options, like credit cards or sources that give you advances on customer payments. That being said, you can consider any of the following to help give your business a cash infusion:

Small business line of credit – This common and popular type of financing works kind of like a credit card. You can borrow money up to a certain amount and pay interest on the funds you borrow. As long as you don’t go over your credit limit, you can borrow funds and repay as often as you need. A line of credit is great when you need a quick boost of short-term capital.

Invoice factoring – This type of financing is a little more risky. It involves selling your outstanding invoices to a lender, also known as a factor, in exchange for an immediate advance on the money your clients and customers already owe you. It’s a quick solution, but interest can add up fast, and if customers don’t pay their invoices, you might have to pay the advance back.

Asset-based loan – This type of loan is secured based on collateral, such as inventory or accounts receivable. These loans are generally quick and easy to get, so they’re perfect for dealing with short-term financial needs.

Equipment financing – If you just need money to pay for equipment for your business, look into getting an equipment financing loan; they generally require less documentation.

Microloans – Sometimes small businesses just need a quick cash injection, and microloans can provide them with loans of less than $50,000. The interest rates actually tend to be pretty low on these loans, but you may have to pay them back much more quickly than more traditional loans.

Small business term loans – As the name suggests, this type of loan has a fixed term, ranging from a few months to several years. Small business term loans can fill an immediate need for cash, such as for hiring seasonal employees or opening a new location.

SBA loans – While the Small Business Administration doesn’t itself loan money, they do guarantee loans. The SBA guarantees 85% of loans that are $150,000 or less and 75% of larger loans. Because of this strong backing, these loans are very competitive.

What You Need

We’ve got the when, the why, the what, and the who – so now, finally, the how. If you’ve figured out the amount you need, what you’re going to use the money for, and what type of loan and lender might be best for you, you’ll need to gather your documents so you can apply. You’ll need:

typewriter with the words tax return on the paper. — *You will need your past and present tax returns ready in order to apply for a business loan.*

A business plan – Make sure to include your plans to borrow a specific amount of money, how it will be used and how you will repay the loan.

Bank and financial statements

Tax returns

Employer Identification Number

Proof of collateral

While adding another bill for your business to pay might not seem like the path to growth, sometimes in order to grow, you need to bite the bullet and take out a loan. This quick cash can make all the difference and bridge a gap that seemed impossible to fill with your working capital. Weigh your options carefully, choose the type of loan that’s right for your business, and you’ll be ready to meet whatever challenges are ahead with cash in hand.

All About Reviews! How to Creatively Use Good Ones and Deal with Bad Ones

The internet changed the way we do business in so many ways. One of the biggest changes? Customers gained a whole lot more power with the emergence of online reviews. Word of mouth went from meaning literally that – a small group of people in one area recommending (or not recommending) your business – to a whole worldwide web of people being able to express their opinions about your product or service. Reviews can make or break your business, so hopefully you’ve got plenty of good ones! If you do, it’s time to start thinking of creative ways to make them work for you. If you have some bad ones, well, don’t fret! Use our tips for dealing with those not-so-hot reviews.

Make Your Positive Reviews Work For You!

Ok, let’s start with the good reviews, which hopefully you’ve got lots of. Reading them might make you feel all warm and fuzzy, but don’t keep them to yourself! You should be actively using them to keep your business growing. Try these ways to make the most of them:

Change it up – While you should use positive testimonials in your print and online advertising, you don’t have to always have to have long, word-for-word reviews on every bit of advertising. Try streamlining things by using your 5-star average from a site like Amazon. Or, if a popular blogger or influencer has featured your product or business, ask them if you can use their logo on your website.

Go in depth – You can streamline your reviews, but you can also go more in-depth and do a full case study of one (or more) of your customers’ experiences. A good case study tells the full story of a customer’s experience with your business and shows exactly how they benefited from your services. You’ll then generate promotional content that will attract more customers!

Share the love – Customers need to see your positive reviews, but so do your team members! Growth doesn’t only come from outside of your business; it also comes from within, so it’s more than worth it to show your team evidence that they’re doing good work. Once a month, do a roundup of the best feedback your company has gotten and circulate it to your staff as a way to boost morale and show them how they’re specifically making an impact.

Try a twist on testimonials – There’s nothing that says reviews have to stay in cyberspace, or simply be transplanted from the internet to a print ad. Think outside the traditional online testimonial and find an unusual way to show off your positive reviews. For example, if you have an office space that clients frequent, have positive reviews printed on coasters and offer them coffee or water and put their drinks on the coasters – they’re sure to notice!

One way to get more reviews is by a referral program such as offering a discount for their positive review.

Put them on the wall of fame – Similarly, you can show off your accomplishments in a dedicated space in your office, like on a wall of fame. Use reviews, deals you’ve done, houses you’ve sold – whatever your business is, your customers will see just how capable you are if you flaunt your successes.

Get in the loop – You’ve got customers raving about you, so give them an incentive to tell more of their friends about you. Create a referral program that offers rewards or discounts to your customers if they share their positive experience with their social network. Also known as a viral loop, this type of program is beneficial to your customer, their referrals, and you!
Bring your customers on board – You can go a step further, and ask satisfied customers to become “brand ambassadors” for you. Ask customers if they’d be willing to connect with prospective customers, to get your relationship off to a positive start.

So now that you’ve got some fresh ideas for what to do with those glowing reviews, it’s time to think about those dreaded less-than-stellar reviews. What happens when a customer just isn’t happy – so unhappy that they’re willing to tell the world about it?

Yikes! You’ve Got Bad Reviews! Now What?

They’re nerve-racking statistics, but they’re real: Customers who have a bad experience are two to three times more likely to write an angry review than customers who have had a great experience are to post a happy review. In addition, one negative review online (when not countered by positive reviews) can cost up to 30 new customers AND it takes 12 positive reviews to cancel out the nasty side effects of just one negative review.

So what do you do if you’ve received one (or more) of these negative reviews? First of all, Don’t panic! One thing those statistics should tell you is that you’re certainly not alone. And you know what? Not only are negative reviews not actually that hard to deal with, they can actually be good for your business. Yes, you read that right! You just need to know how to combat them, and use them to your advantage. Here’s how:

Put them out there! Don’t try to hide negative reviews, publish them. It’s natural to have some unhappy customers, and allowing your negative reviews to stay out there shows you have nothing to hide, and makes your business seem more authentic. Remember, customers tend to trust reviews more when they see a mix of good and bad reviews.

Listen… Show that you care and that you’re listening to your customers by responding publicly to each negative review. Research shows that businesses that respond to negative reviews actually tend to see a rise in revenue. Include in your response:

- - An apology
  - A statement of your commitment to customer satisfaction
  - A proposed resolution
  - A way to take the conversation offline
    When you have a bad review, make it right by following up with the customer to see what’s wrong and how you can fix it.

…And learn – Take each negative review as a learning experience, and use it as a way to improve your business. Is there anything you can learn about your products or service from the negative feedback? Stop bad reviews at the source by addressing any issues brought up by your customers.

Make it right, but don’t forget to follow up – Once you’ve come to a (hopefully satisfactory) resolution with your customer, make sure to follow up with them. The resolution AND your commitment to them will stick with them long after the bad experience with your business will – and they’ll be more likely to amend their negative review!

Get more reviews – One practical way to counteract negative reviews? Get more reviews, period! Studies show that 86% of reviews are actually good reviews, so getting more positive feedback is simply a numbers game.

Reviews. Every business is going to get them, and every business needs to know how to handle them, whether good or bad. Positive reviews can grow your business, but you’ve got to get them out there! Bad reviews can set you back temporarily, but if you use our tips for dealing with them, you’ll come away from a bad experience stronger than before. And remember, any kind of review can help your SEO – remember that old saying, “There is only one thing in the world worse than being talked about, and that is not being talked about.”

Tag: business growth