Small Business Marketing

In today’s highly competitive business industry, subscribing to popular business and finance magazines are more important than ever before. These trade magazines can help you become updated with the current trends in your business niche. Whether you want new insights into your particular market or the current trends today in management, business and finance mags can surely help you.

There are literally hundreds of business magazines. They vary in many aspects. Many Sites offer cheap subscriptions of the most popular business and finance magazines. This can provide you with unbelievably big discounts than when subscribing to the publisher itself, or even more savings than buying them in your local newsstand.

But the main question now is, among these popular business mags, how do you know if you are making the right choice? Here are some tips to help you search for a good business magazine that is sure to benefit you and your business:

1. Look for magazines that covers every aspect of your business. You may need to get more than one type of business and finance magazine. You may even use some other subscription when necessary. For example, if your target market are teens, you will find a teen magazine subscription useful as means of market research. You can use theoretical or management magazines to help you look for solutions when issues arise. Do not limit your resources when it comes to your business. Magazines provide lots of information that you cannot find elsewhere.

2. Take advantage of free magazine subscriptions. There are free magazine subscriptions that publishers provide. However, they usually need to fill up an application form which requires you to describe your qualifications. When filling out the form, do not exaggerate and be as truthful as possible. Consider the possibility that the magazine publisher may deny your request, as these free subscriptions are only provided on a limited basis.

3. Make sure that you make a good use of your business magazine subscription. Remember that popular business and finance magazines do not come cheap. Make the most use of it by reading from page to page. Even if an article is not quite related to your niche, take time to read it. You will be surprised that it can bring you information you didn’t know before. Of course, make sure you do not order more business magazine subscriptions that you can read.

By: Alex Richard

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I’m not an Economics Major! What do I need to know about Small Business Finance?


No, you don’t need to be an economics major, but you do need to understand the basics of small business finance and good financial management. And if you are an economics major, Great! You have a big head start.

Do you need a bunch of spreadsheets? Not today, but as you plan your business and it begins to grow, you’ll know how to use these! When you’re starting out, there are five basics areas where you need to learn as much as you can:

Bookkeeping:

In very simple terms you need to keep track of the money that comes in and the money that goes out. It may sound a simple, and it might be in the beginning, but you’re not starting this business to run for a month. Hopefully you’re starting this business to last for a long time.

It’s a very good idea to put a smart small business finance accounting system into place from the beginning, and get it set up to grow with your business. You will find a resource page below with some very good basic accounting systems that are affordable and easy to use for small business finance.

Credit and Collections:

You need to make sure you get paid for your product or service. How this happens can vary greatly based on the type of business you run. If you’re just starting out, you will probably not offer your customers credit terms, more likely it will be cash on delivery.

For this you need a payment tool that your customers trust (always look at your customer’s point of view first) and one that will allow you immediate access to your cash. There are many online payment tools and gateways, like PayPal.

One important note, it is an extremely smart idea to use a payment tool or gateway that also offers you the ability to download transaction details into your accounting package. This saves you loads of time manually entering information into your small business finance software package, and has many additional upside advantages.

Cash Flow:

This is where most people have problems with small business finance, and the largest reason for business failures. Let me explain it this way.

Can a profitable business fail? … YES, and many do! Always Remember – Cash is KING!

You must have enough cash coming in to pay your expenses. In the beginning this will be from your own pocket or from your small business finance loan or credit facilities. But eventually, and in most cases sooner rather than later, the start-up funding will run out. You need to be focusing on cash flow from Day ZERO, and eventually when the business is running on its own income you can focus more and more on profitability.

Purchasing:

You will need to buy things for your business. In the beginning it’s important to focus on how you pay for these items. If you’re using your credit card, no problem, but watch the finance charges. Try and keep the outstanding balance on your card down to a minimum.

If your making most of your purchases online, then find a good payment tool or gateway that you can use to pay for purchases while at the same time collecting money from your customers.

Financial Analysis:

Don’t worry, this is not a huge issue in the beginning, because if you’re like most new businesses there will be very little to analyze.

But keep in mind; this will become more and more important as your business begins to grow and you have less and less time to dedicate to finance. You will need to again select an accounting package that can grow and expand with your business giving you easy reports to understand.

In the beginning you really just need the ability to watch your finances and do short range forecasts of your cash flow. Most accounting packages have this as a basic part of the package, if not; keep looking for a system that offers this from the beginning.

Get the Small Business Finance Basics right, and the rest will follow with much greater ease. Ignore the basics, or do them wrong, and you’re asking for problems later on that will distract you from your main function as a business owner which is finding and keeping customers!

By: David J Ogden

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Business Finances

The complex world of business where finance is concerned can be quite confusing, especially if you have to gain some footing in an industry dominated by finance experts. It seems easier to find business finance software that can do all this for you.

At the outset, it is crucial to understand and drill out your needs and goals. First develop a over all picture of what you would like to achieve with any new software or application. Next drill down to see what features are an absolute necessity for your business, others that would prove useful but not absolutely necessary and still others that are superfluous and not required now or in the future. Having such a comprehensive and detailed view will give you the tools to find the perfect finance software for your organization.

The ideal business finance software should help you to manage your finances accurately with as much ease as possible. The features that the software provides should enable you to automate the following aspects of your finances.

Budgeting Categorizing Managing Scheduling Tracking Reporting Tax Calculations

While all the above mentioned features are absolutely important to look for, there are some hidden non-functional features that should be considered for picking the best product.

Security Integration Interface Support The cost

A thorough research and analysis Is mandatory to find the perfect fit for the organization. Look for a feature comparison, scalability, reliability and speed of the compared products. This type of detailed study will help find the right software product.

By: James K Murray

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Whether your business is small and new or large and established you will need adequate finance for the majority of projects, purchases and expansions you’re your business makes.

Obtaining the necessary cash to get your business off the ground can be a challenge and few new companies are able to finance themselves on cashflow alone and therefore need to consider gaining finance from other external sources. There are many of these external sources who will be willing to provide you with this start up finance, a few examples of these are stated below:

• Bank loans

• Business angels

• Venture capitalists

• Overdrafts

• Credit cards

• Friends and family

These are just a few examples of some of the places that business start-up finance is available from; however there is another source of business finance available that many people often seem to forget, this is grant finance. Business Grants can however take several months to process so you should always add extra time to your planning so that you get a decision on your grant application before the project is due to start.

A lot of start up companies and small businesses are often put off the idea of applying for a business grant to help them with their finances and because of this many of these businesses are missing out on a great opportunity to gain extra cash for there business; cash that doesn’t need to be paid back.

Few, if any new companies can finance themselves on cashflow alone and therefore need to consider raising finance from other external sources. If your business needs extra cashflow for a specific project or purpose then a business grant could be exactly what you need. This is because business grants are only awarded for specific aspects. So what exactly is a business grant? A business grant is when an organisation or authority gives a sum of money to your business to help you succeed in a particular project these business grants are mainly awarded by the Government at both a local and national level as well as by smaller bodies such as The Princes Trust or The Arts Council.

When you are applying for a business grant there are certain things that you should keep in mind such as a detailed description of the project, an explanation of the potential benefits of the project, a detailed work plan, details of your own experience and if possible a business plan. All of these will help you with your application process and help you to get closer to that business grant that you want.

If you are successful in your grant application the money that you receive is none repayable and you won’t have to pay any interest for it either; however you will need to carry out a significant amount of hard work if you want to stand a chance of obtaining a grant. These grants are also limited so the competition that you will face for them is intense.

By: Helen Cox

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More residential real estate investors are exploring commercial real estate and business loan alternatives as a result of the increasingly chaotic investment environment for residential financing. In these circumstances prospective commercial property owners, business investors and business owners should educate themselves about choices for the business opportunity financing and commercial loan climate that currently prevails throughout the United States.

Environmental requirements for business finance will be a complex issue for numerous business investments. Environmental issues involved in a business loan will primarily depend upon the commercial lender as well as the type of business. More extensive requirements can impact both the cost and timing for a commercial mortgage loan.

Tax returns and financial statements for a business loan are likely to be a concern for all commercial borrowers. Whereas residential mortgage financing is likely to involve only personal tax returns, most business financing will include a review of business tax returns as well. Business financial statements and personal financial statements will be required for certain kinds of business opportunity financing and commercial real estate financing.

Secondary financing will often be a means of acquiring desired commercial loans. The use of seller financing or secondary financing is a prudent business financing strategy to reduce capital requirements for the borrower. Secondary financing will not be accepted by all commercial lenders.

An unexpected requirement for many commercial loans involves sourcing and seasoning of funds. When purchasing a business, some lenders will require that borrowers document where the down payment is coming from (sourcing) and how long the funds have been in that location (seasoning). If a borrower cannot adequately provide this documentation, the choice of commercial lenders will be more restricted.

Collateral and cross-collateralization for business loans will be an insurmountable obstacle for some commercial borrowers. Collateral requirements for business financing will depend on many factors such as down payment, type of business, credit scores and the type of financing needed. Cross-collateralization refers to lender requirements involving personal collateral such as a home used as collateral for a business loan.

Any requirement for a business plan when obtaining commercial mortgages is likely to be expensive and time-consuming. A business plan is not always required for a business loan, but when one is required this will add significantly to the cost and length of the loan process.

An increasing problem for commercial borrowers seeking refinancing is an unreasonable limitation for getting cash out of the new loan. Commercial lenders differ significantly regarding restrictions imposed on the amount of cash out to the borrower when refinancing. Some lenders will not permit any cash out whatsoever while others will limit cash received by the borrower to a particular amount. The preferred approach is to use a lender that will allow cash to be paid out up to an agreed loan-to-value (frequently 75%).

It is important to to thoroughly analyze business financing lockout penalties. A lockout penalty is much more severe than a prepayment penalty in that such penalties can effectively prevent a commercial borrower from selling or refinancing during a prescribed period (often two to five years).

In addition to the issues noted above, numerous other key business finance and real estate mortgage issues will also be important to evaluate. Commercial mortgage requirements are very different from residential financing requirements in the United States. We have prepared several other business finance overviews addressing additional factors that will be significant for most commercial borrowers. Separate report topics include SBA loan refinancing, business opportunity financing, stated income business loans and commercial appraisals.

By: Stephen Bush

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There are two types of costs “direct” and “indirect.” Direct costs are also called “variable costs” and refer to costs that are a direct result of producing, delivering, or returning your product/service. Examples of these are materials and labor needed to produce/deliver the product that only occur once you sell the product, transactions costs like visa commissions, sometimes shipping charges, etc.

Indirect costs are also called “fixed costs” and refer to expenses that your business will have regardless of sales volume. Examples of ithese are rent, utilities, wages that are not based upon commission, interest expense, advertising, automobile, etc. The tricky aspect of these are that a cost may increase with increased sales, e.g. an increase in sales may require overtime or the addition of staff but the relationship is not direct.

A good tool for managing direct and indirect costs is to monitor the costs on your monthly income statement using percent of sales. Divide the cost by total sales.

Direct costs as a percent of sales will remain within a narrow margin, e.g. materials costs if 30% of sales at $1,000 sales then materials should be right around 30% at the $5,000 sales level. The actual dollar amount of materials used to produce more products will go up but as a percent of sales, it will remain close to 30%. What would lower the percent is if you got a better deal from your supplier.

Your indirect costs when monitored as a percent of sales will respond differently. For example, rent equaling $500 per month remains $500 per month even if your sales increase to $5,000. $500 divided by $1,000 in sales equals 50%. $500 divided by $5,000 in sales equals 10%. (It is that old math axiom in action here: A numerator divided into a larger denominator produces a smaller fraction.)

So why is this important? Knowing the difference between direct and indirect costs provides you with a couple of valuable management tools, break-even analysis, and your contribution margin. Break-even analysis is a handy management tool for quickly determining if a solution is feasible. Contribution margin is the remaining profit after direct costs are taken out of a sale. For example, if you sell a bookcase for $250 and it cost you $75 to make your contribution margin is $175 or 70%. The contribution pays for all the Fixed expenses/overhead.

A good way of organizing these costs is to put all the direct costs in the “Cost of Goods” section and the indirect costs in the expense area of your income statement. By doing this Gross Profit equals Contribution Margin and is automatically calculated for you.

Another reason to identify your direct costs is when bidding in a competitive environment. Ever wonder how your competitor beat you on a bid??

Imagine a situation where you know you have covered your overhead expenses for the month with normally bid projects. A quick project comes up for bid around the 15th of the month and you have a crew available to work on it. You figure it will be very competitive and if you use your usual estimating process on it you will not get the project. Since you have already covered all your expenses for the month and any margin above your direct costs is profit. Plus you have a crew that it would be better to have working on a project and being paid by a client versus cleaning the shop being paid by your profits. You decide to aggressively go after the project with a bid slightly above your direct costs.

By: Bruce D Hunter

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What business & personal finance advice do you wish had been taught to you when you were at school? Isn’t the purpose of education to prepare children for the real world?

I believe that all children should learn basic business & personal finance skills from the age of twelve to sixteen years. Why not teach children how mortgages and pensions work. Everybody needs a place to live and if they have a long life they will need to retire one day.

Schools should teach their students how to manage credit card debts. They should be taught how credit card companies make their money by charging extortionate amounts of interest far higher than a personal loan to people that pay late.

Students should learn how to negotiate and barter. After all they are going to be doing this every day for the rest of their lives. What about learning the difference between mark up and profit margin?

Learning how to handle money would be the best compulsory course at school. If you add a class like “Business & Personal Finance” and make it standard for all children then what subject would you remove or do less off?

I had a period a day of Latin. This has been pretty much useless in my life. Has anybody benefited from learning Latin? I read about the Greek gods, translated old books and I have to admit that after doing it for over 4 years, I only remember a handful of phrases now.

How many of you remember sweating over stuff like Algebra and Trigonometry? Has this been useful to you in life? Surely this does not need to be taught in such detail to every child & only needs to be taught to budding scientists and mathematicians?

I had art classes. Where they really necessary? I was also taught how to knit and dance? What was the point of that? What about religious education? Shouldn’t this type of stuff be taught in Sunday school? Should this subject really be taught in school at all?

I am not advocating that we remove these subjects completely. As you can see it would be really easy to teach slightly less of some other subjects to make space for one period a day of Business & Personal Finance for all older children.

Would this benefit the UK economy? I am sure it would. Imagine students leaving school having basic understanding of fixed and variable interest rate mortgages. They would have learnt how to manage their bank account and check their bank statements. Wouldn’t it be great if they knew how to calculate gross / nett profit margins and compare one investment with another?

Many people will make the argument that this information should be taught by parents and not by school teachers. The problem is that many parents themselves do not understand basic concepts of personal finance! Some view their own personal finances as a private matter that should not even be discussed in front of the children.

What subjects do you think they should teach more of and which subjects should they teach less of to make room?

By: Nazir Daud

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Ensuring that your business has an effective funding solution is key to your business success. Before you can do anything with your business you need the finance to be able to fulfil your business needs. So how do you go about gaining the business finance that you need?

There are many avenues that you can approach when it comes to gaining your start up business finance such as bank loans, investors and credit cards as well as overdrafts; however in order to gain any form of business finance you need a well thought out and structured business plan. On the other hand there are occasions when you may have a viable business plan but you are still struggling to get finance in order to expand or start up your business; this is where a Small Firms Loan Guarantee can help.

Small Firms Loan Guarantee is also known as SFLG and is a joint venture between the Department for Business, Enterprise and Regulatory Reform (BERR) as well as a number of participating lenders. An SFLG was put in place for people who have tried and failed to get a conventional loan. They are available for most types of businesses and business purposes but it should be noted that there are still some restrictions and exclusions, which is why it is important that you check these against your business before making an application for a SFLG; this can be said for any form of finance. You should check that your business is able to apply before applying for any form of finance to save yourself time, money and effort.

A Small Firms Loan Guarantee is most suited for small to medium businesses that have trouble trying to gain a conventional loan. They are extremely helpful to small and medium businesses as you won’t have to offer assets as security. But before you apply for a SFLG you should take a good look at your business and carefully think about the needs of your business. When doing this you should keep questions such as the following in mind:

• What is the money needed for?

• How much money do you need for your business?

• Have you investigated all of the forms of finance that are available to you?

I suppose you are now wondering what exactly a Small Firms Loan Guarantee offers you, well the main features and criteria of a SFLG are as follows:

• A guarantee to the lender covering 75% of the loan amount, for which the borrower pays a 2% premium on the outstanding balance of the loan, payable to BERR

• The ability to guarantee loans of up to £250,000 and with terms of up to ten years

• Availability to qualifying UK businesses with an annual turnover of up to £5.6million

• Availability to businesses in most sectors and for most business purposes, although there are some restrictions

So if you are a small to medium business in need of finance then keep the idea of a Small Firms Loan Guarantee in mind, you never no it could be just what you are looking for.

By: Helen Cox

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Whether you are starting up your business or expanding it you will need finance in order to do so. This is especially relevant to new businesses that are just starting up. There are numerous avenues that you can approach in order to gain this start up finance and there are many different forms of it open to you; choosing the right finance that will benefit your business most is the important thing.

There is a saying that states ‘it takes money to make money,’ this applies so much to new business ventures. For your business to become a success you will need a large amount of money to start off with that can be used to get your business set up. This money will be used to buy equipment, pay the rent on your business property, employ your staff and ensure that you have enough stock to get your business going as well as being used to pay the first few months of all your bills.

Two of the main reasons why many new businesses fail to get anywhere beyond the starting point are due to inadequate business capital and poor management skills, which is why raising money is so important in the early start-up stages of business.

Some ways in which people choose to fund their business idea is by using savings, but realistically not many of us have that sort of cash tucked away, which is why we require outside help. You could opt to borrow money from friends or family if they have the financial resources to help you or you could take out a credit card for the specific use of funding your business. All of the financial options that are open to you can be split into two sections, either debt finance or equity finance. Debt finance is classified as being money that is borrowed from varies different aspects. This is finance that is required to be paid back.

Some examples of debt finance include:

• Bank loans

• Credit cards

• Overdrafts

• Leasing

• Asset financing

All of these are the borrowing of money in one form or another and they will require monthly repayments that will have added interest. Most people however use their bank as the first call of gaining start up finance regardless of the fact they are going to end up paying more money back.

There are disadvantages and advantages of using a bank loan to fund a new business idea. However the disadvantages of having a bank loan to fund your business start up far out-weigh the advantages. The benefit of using a bank loan for business finance include being able to organise a repayment holiday meaning you only have to pay interest for a certain amount of time and you don’t have to turn over a share of your profit. The disadvantages however are that bank loans have strict terms and conditions and can cause cash flow problems if you are unable to keep up with your monthly repayments. Also bank loans are often secured against assets and you may be charged if you decide you want to repay your loan before the end of your loan term.
The other form of finance; equity finance, is often more overlooked than it should be when in fact equity finance could be just the answer that your business is looking for. The main forms of equity finance come from business angels and venture capitalists. Equity finance is money that is invested into your business in return for a share of the business. With equity finance the advantages out-weight the disadvantages and equity finance is a lot more helpful to small businesses than bank loans are.

Some of the advantages of equity finance include your investor being committed to your business and intended projects, they can bring valuable skills, contracts and experience to your business and they can assist you with strategy and decision making as well as often being prepared to follow up funding as your business grows. Two disadvantages of equity funding are your business may suffer as you are spending time securing your investor deal and the investor will own a share of your business.

The one thing that you must do when choosing your business start up finance is to use a finance option that is most suited to your business needs.

By: Helen Cox

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Invoice factoring is a useful but often misunderstood element of small business finance. So in this article, I’ll explain what factoring is and how it can help certain business owners sustain their growth.

By way of definition, factoring is a process through which small business owners can convert accounts receivable (invoices) into much-needed working capital. Basically, there are three primary parties involved in the process:

The Invoicing Company – This could be any company with accounts receivable in the form of invoices. Additionally, the company’s owner wants to convert those invoices into much-needed working capital. For this example, let’s refer to this business as “Acme Corp.”
The End Customers – These are the customers who have been invoiced by Acme Corp and are thus part of Acme’s accounts receivable system.
The Factoring Company – This is the financing company that specializes in providing working capital through such services as invoice factoring. This is where Acme Corp will go to try and convert their invoices into working capital, a.k.a. cash flow.

Now let’s assume that next month will bring some major equipment purchases for Acme Corp. They need two new vehicles for their business, along with some other equipment. The only problem is, a lot of their capital is tied up in the form of invoices. This represents future revenue, but it doesn’t help Acme Corp here in the present, and it won’t help them make those equipment purchases next month. In other words, those invoices are not considered working capital.

In this common scenario, a small business factoring company could step in to help Acme Corp transform their accounts receivable into working capital (which could be used to make those equipment purchases next month).

So Acme’s owner (Bob Smith) would work with a factoring company to transfer some or all of his invoices to the company. The factoring company would then advance Bob a portion of the invoice total, typically around 80 percent. Bob has just converted 80 percent of his accounts receivable into capital that he can use to cover those equipment purchases.

The end customers (the people who owed Bob those invoices) would now make payments to the factoring company, instead of sending them to Acme Corp.

This approach to financing is not for every business. Like any other financial strategy, there are many considerations that must be taken into account. But the point of this article is not to say whether or not factoring is right for your business, but merely to make you aware of this unique approach to small business finance.

By: Brandon Cornett

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