Author: comparebankdeals

The decision to hire new staff is often a challenging one to make. Most owners faced with this type of expansion are hesitant to act, citing the costs of both time and money. But even when costs can be minimized, others defer to the common entrepreneurial trait of having a do-it-yourself mentality, believing that they can do everything on their own. Even more simply plead ignorance, predicting that present-day troubles will magically remedy themselves in the future. But if your company truly needs more support, attempts to justify or ignore the problem might kill your business. Yes, you might be willing…

One of the most significant benefits you can provide your child is to raise them with a business mindset. Whether they choose to be involved in business or not, exposing them to the elements of a successful business from a young age will set them up for success. While only a few children exhibit an interest in the business from an early age, parents may offer them games with a business attitude to stimulate an interest in the business. In this blog, we will be discussing over few business games for kids that every parent must explore: 1. Lemonade Stand…

Arguably, the ultimate goal of a business should be to please its customer. A happy customer equals more business, and more business equals profit, growth and longevity. But having happy customers means more than shaking a hand and smiling. If your business can’t back up its customer service without solid strategies and fundamentals, such as sales, pricing, operations and distribution, then it’s going to run into trouble. Consider this bittersweet example. Let’s say that you create a clever video for your product, and the video goes viral online. Getting customers, your No. 1 marketing and business goal, has just been…

Independent contractors (ICs), many of whom consider themselves freelancers or consultants, are booming across many industries. ICs can be beneficial additions if your business is picking up steam, especially if your company seeks to expand its workforce without taking on more full-time employees. For instance, if your business needs a website that requires ongoing maintenance, you might hire an IC to take on the job. In this circumstance, the odds are that you would save a considerable amount of money by not hiring an in-house employee. There are numerous benefits to hiring independent contractors, but there are also many details…

Remember the time when you were applying for college or grad school and recommendation letters were required? Well, references can be just as useful when seeking a job and are a normal part of many employment applications. Whatever the occasion, a recommendation letter offers an outside perspective on your character and skills. Because of this, you should be prepared when asked for one. Below we describe the different types of recommendations, who you should ask for recommendations, and how to go about requesting them. In general practice, recommenders are busy professionals who may be willing to vouch for you but…

“If you fail to plan, you are planning to fail” -Benjamin Franklin Creating a thorough business plan for a new or evolving venture is essential. A convincing blueprint is a must for soliciting investors, but its value extends beyond that, as creating a business plan forces you to carefully examine your company’s goals, strategies and potential. Using a template will help ensure your business plan is presentable and digestible. But just as every business is unique, so is every business plan, and there’s no one universally expected format. At the very least, though, a good plan will generally contain some version of…

Why do you need to write a business plan? Well, for starters, an effective business plan can help you acquire funding from investors and banks because it demonstrates that you have done some research and thought about marketing, operations and finances. It’s a great starting point to build off of. Some successful entrepreneurs with experience in launching startups, a rolodex of powerful connections and a proven track record may get away with not having a plan, but if you’re opening your first business, a business plan is almost always a prerequisite. Another thing to remember is that an effective business plan is never written in stone. It is…

Everyone knows how important it is for a business to maintain best practices for company finances. While faults in customer service or marketing can hinder your business, accounting mistakes can stunt your growth and leave your company struggling to survive.  Small business owners wear many hats, dealing with duties ranging from marketing, to inventory management and everything in between. With the hustle and bustle of trying to stay on top of everything, errors can occur, especially with respect to accounting. But with prudent planning and smart choices, even accounting errors can be mitigated or avoided altogether.  Here are six things you can do to help avoid common accounting mistakes. …

Do your family and friends incessantly ask you to bring those delicious cupcakes to get-togethers? Are your brownies the talk of the town (in a good way)? Do you make the pies for the community pie-eating contest? If your baked goods garner their own attention, you might have a great shot of rolling that dough from the counter to the bank. If you’ve been thinking about opening up your own business and people clearly want your product, you might be ready to take a crack at a bakery. Opening any business takes a tremendous amount of effort, and some bakeries are…

So goes the popular saying, “It all starts from the ground up.” This is especially true when starting a construction company. While you may think it’s necessary to be a handyman or to have a natural knack for using tools, neither is entirely true. Your primary focus as the owner is to have a handle on running the business. Depending on your location’s seasonality and local demand, running a construction company can be a very fruitful endeavor. But as with any business venture, starting a construction company will require a lot of time, energy and paperwork. In addition to standard…

There are many elements to figure out when building your brand. But when it comes to creating visual assets used to promote your brand, color should be a big consideration.  Colors are the first aspect of branding that a customer sees, and smart and vibrant colors can breathe life into an otherwise bland marketing campaign. Leslie Harrington, Executive Director of The Color Association, says, “The first point of interaction is shaped by the color, and the color is the most memorable sense. Before anything else, [customers] see color.” If you doubt this, think about road signs. When is the last time you drove…

Brewing beer often begins with a home-brewing kit and slowly ferments into a passionate hobby. Being able to convert this hobby into a career is an intoxicating prospect for many, but it takes far more than hopes and dreams to bring it to a head. In order to professionally brew beer, and just as with any business venture, you need to be passionate about it without forgetting the bottom line. Owning and operating a brewery undoubtedly has its fun parts, but there are steps you must take and bitter challenges you will face. When running a business revolving around alcohol…

When rival companies step on your toes by offering the same product for a lower price, the easiest solution is to match their number or go even lower. But that’s also the worst solution. You may look at a company like Walmart and think, “If they can do it, why can’t I?” Walmart is a rare specimen that has mastered scalability based on the massive quantity of products they sell. Instead of jumping on the Walmart train of thought, which could send your company flying off the tracks, evaluate your own company’s margins. Then protect this evaluation with your life. You can…

Keeping your customers happy—and therefore loyal—is key to any long-term business success. It takes much less time, effort and resources for you to encourage repeat business than to try and cultivate new customers. But what are the best ways to increase customer retention? Let’s look at some of the best ways to keep your customers intrigued, engaged and, most importantly, patronizing your business. 1. Offer them something for free It’s no secret that everyone likes free stuff. It may seem like a costly proposition to give things away, but it doesn’t have to be a product or service. Are there vendors or other…

Whether you’re a business owner or executive looking to hire your first employee or your 50th, you’ve probably heard the popular catchphrase, “Hire Slow, Fire Fast.” This mantra, which has become popular for startup founders, advises entrepreneurs to hire deliberately and intelligently. Or, in other words, “hire slowly.” On the other end of the spectrum, business owners should “fire fast” to avoid prolonging the inevitable; keeping on a worker who is not only the wrong fit but who’s also hurting productivity and the work environment you’re trying to build. As with any business practice, there are skeptics who point out…

Have you received a direct message on your social media platform like Facebook, Twitter, Instagram, or Telegram where the sender reveals their trust wallet key and asks for assistance in making payments? Be alert! It can be another trust wallet scam where you might lose your money. SCAM ALERT: Don’t act on it too quickly, if you see someone leaking a private key. Beyond original projections, the cryptocurrency sector has expanded since the launch of Bitcoin in 2009. Cybercriminals have taken notice of the pseudonymity aspects of cryptocurrencies, and they are already using them to carry out potentially untraceable scams. Scammers…

A key performance indicator (KPI) is a metric that shows how well you accomplish an important business goal. KPIs help you assess how well you’re doing at achieving specific goals. As an illustration, you can decide to utilize marketing ROI (MROI) as the KPI to track your progress toward the aim of increasing your marketing effectiveness. As another illustration, you could track development using KPIs like the share of voice, direct traffic, sponsored search traffic, and more if you wanted to raise brand recognition. Another useful KPI for evaluating and monitoring changes in your performance in comparison to competitors is…

Every effective marketing plan is built on solid market research. It’s the only way to have a deep understanding of your market, clients, and rivals. Every market research operation, in general, can be classified into one of four broad types of market research. We’re breaking down the four forms of market research to help you focus your efforts and make sure you have all the data and information you need to successfully implement your marketing initiatives. What is Market Research? To make wise decisions, market research means learning as much as you can about your market, consumers, and rivals. When…

We already discussed what market segmentation is and how it may help you understand your clients, pinpoint needs in your market segment, and work out how to effectively satisfy those needs with your goods or services. Now we are going to discuss the different types of market segmentation and their features. The Four Types of Market Segmentation The four types of market segmentation are demographic segmentation, psychographic segmentation, behavioral segmentation and geographic segmentation. Multiple sub-categories further divide audiences and clients into categories within each of these market segmentation kinds. 1. Demographic Segmentation One of the most well-liked and frequently employed…

The first step of any marketing campaign is to identify the target customers. However, a group of target customers does not effectively communicate the relevant information useful for the marketers. One method of effective market analysis is market segmentation. By using market segmentation, you can target customers based on certain traits, develop more successful marketing efforts, and identify opportunities in your industry. What is Market Segmentation? The technique of segmenting a target market involves breaking it up into more manageable chunks. Customers and audiences are divided into groups based on shared traits like demographics, interests, needs, or location. So, market…

Real estate is an important asset for any business to have. It is the most important investment that a business can make. The location of a property matters a lot when it comes to real estate investments. Location has an impact on the price of the property and on its overall value. Location is one of the most important factors in real estate, and it can make or break the value of a property. For example, if you are looking to buy an apartment in New York City, you might be told to consider buying one near Central Park because…

For every campaign, marketers are constantly attempting to provide an answer to one fundamental question: what do our customers want? Naturally, not every buyer has the same preferences. Because of this, many businesses divide their target markets into several consumer categories and give priority to those based on how much value their goods and services provide. One of the most effective methods of market segmentation is benefit segmentation. Since Haley (1968) introduced the idea of benefit segmentation to marketing literature, both consumer and business markets have employed it. Its superiority is due in large part to the fact that customer…

A business idea checklist for evaluation and decision-making might be helpful for someone who wants to validate a business idea and has to convince partners or authorities of its viability. A business idea checklist should be used to ensure that an idea is well-supported and suitable for presentation to an audience. Before you start any business planning or development, it’s important to vet your idea to the best of your ability. You can use this checklist to evaluate an idea and decide whether you should launch a new business. Make sure you have proper planning for each of these points.…

We all do it from time to time. We get bogged down by busy work in the office, open up a private browser and check up on local sports news. Or we’re called into a meeting that is seemingly of no concern to us, and we pull out our phones and check our buddies’ social media pages. This type of time-wasting is inevitable, but just how much of it occurs in the office on a daily basis? Salary.com sought to find the answer to that question and many others in a recent study, and their findings just might surprise you. Wasting…

In the world of business, sales and marketing are two terms that are usually used together and sometimes even interchangeably. While both are primarily aimed at the purpose of increasing the revenue of any business or organization, these two concepts have notable differences that people need to be familiar with. Simply put, marketing is raising potential customers’ awareness of your business and brand. Sales involves converting those potential customers into paying customers in order to turn viewership into revenue. What is Sales? The main purpose of sales is to sell the things that are in stock. This develops relationships with the customers…

The process of employment is a rather long process that will require several steps and phases to be completed. Recruitment and selection are the two crucial aspects of employment that need to be carried out by hiring managers. However, while these two terms might seem to be synonymous, the truth is that they are entirely different concepts that should be properly identified and understood by both job seekers and employers. What is Recruitment? Recruitment is a process that starts with sourcing the potential applicants. The recruiter, human resources department or hiring manager may use college recruitment programs, job boards, networking, social…

When you are dealing with competition in your online business, you may need search engine optimization (SEO) and pay-per-click (PPC) to be part of your internet marketing. Both PPC and SEO are part of SEM or Search Engine Marketing and both can give you multiple advantages when dealing with the competition online. Both SEO and PPC are ways of generating traffic to your website. But knowing their differences could give you a big help in deciding which of the two suits your online business requirements. What is SEO? Search Engine Optimization (SEO) refers to the process of getting traffic over the…

The main reason there are things such as trademarks and copyright is that every work or idea needs to be protected at all costs. Trademark and copyright are used to guarantee that only the rightful owners and creators will be entitled to make the most out of these. While these two offer protection under the law, these concepts have different functions and purposes. Let us see how a trademark differs from copyright. What is a Trademark? Trademark is used to protect a word, device, name, or symbol utilized in commerce. The purpose of trademarks is to distinguish products of a certain…

Merger and acquisition are very well-known terms that are used when people are talking about companies and organizations. Merger and acquisition are both processes of corporate restructuring. Both are defined as a process of combining two or more companies together. Both look similar, but they are different terms used in different situations. Check out the differences below.  What is Merger? “Merger” is the term used when two or more companies or organizations come together to expand their businesses. Merger deals are mostly finalized on friendly terms. Two or more companies share equal profits in the newly created company. In a merger, two…

If you have a bank account, you must have heard the terms “saving account” and “current account”. The majority of us are unsure of what these are and how they differ from one another. What is a saving account? An interest-bearing deposit account held at a bank or other financial institution is referred to as a savings account. It is a deposit account made to store money that you don’t intend to use right away. The Savings Account is a transactional interest-bearing account where a deposit is made with the Bank for an uncertain length of time. What is a…

Though the debit card is your debit money and credit card is your credit money, let’s drill down the exact differences between a debit card and a credit card. What is a debit card? When a debit card is used, money is immediately taken out of the user’s checking account. It is also known as a plastic card, bank card, or check card. With a debit card, users can make purchases and have money electronically transferred from their bank accounts. What is a credit card? A credit card is a type of credit facility offered by banks. It enables users to…

Identifying the difference between management and leadership It has always been suggested by studies and research that management and leadership must go hand in hand for better organizational structure, but they are not the same thing at all. We can say that management and leadership are necessarily linked and complementary to each other, but on an individualistic front, these are two different concepts and imply different respective meanings. As far as the industry on leadership development is concerned, there is plenty of confusion regarding the relationship between management and leadership. There are a lot of people who are using these…

A one-person company refers to a business with just one member. A firm with just one shareholder among its members is an OPC. A private limited company is a type of business where there must be a minimum of two members and a maximum of 200. The major difference between a one-person company and a private company is that a one-person company is a mixture of a sole proprietorship and a company form of business, whereas private companies are either run by non-governmental organizations or by relatively small numbers of shareholders. What is a one-person company (OPC)? A one-person company (OPC)…

Before understanding the relationships and differences between budgeting and forecasting, let’s understand the meaning of these terms. Definition of Budgeting Budgeting means the projection of a comprehensive and coordinated plan, expressed in financial terms, for the operations and resources of an enterprise for some specific period in the future. It is a strategy outlining how the management intends to achieve particular goals. The commitment of the management is key to the success of the preparation and implementation of a budget. A budget in business formally expresses the anticipated revenue and expenses for a specific future period. In other words, a budget…

Budgeting means the projection of a comprehensive and coordinated plan, expressed in financial terms, for the operations and resources of an enterprise for some specific period in the future. It is a strategy outlining how the management intends to achieve particular goals. The commitment of the management is key to the success of the preparation and implementation of a budget. Basic features of budgeting 1. Comprehensive and coordinated plan – Integrated Plan The future expectations of a company are planned out in a budget. Planning involves the manipulation and control of relevant, both controllable and uncontrollable, variables, which lessens the impact…

Is it true that you need a formal business plan before you start your new business? Well, the answer is not a simple yes or no, but instead depends on the circumstances. The following are seven situations where and when you need a formal business plan for your business. 1. Make a Business Plan if You’ve Never Done This Before If this is your first time starting a business, a business plan can be an indispensable resource for you to refer to as your business grows. It can serve as a road map that can help you achieve your goals,…

There are several types of business entities recognized by the United States. Each type offers certain benefits to companies and industries. Some offer tax benefits, while others offer liability protection, but each entity serves a specific purpose in the business world. Listed below are the most common types of business entities in the United States. Linked within the sections are articles outlining the steps needed to form those entities. Follow along to see which one best fits your business. 1. Sole Proprietorship The simplest form of a business entity, a sole proprietorship is owned and run by a single person. While the…

Anyone can give a good interview — here’s how. There are those who are naturally glib. Whether they’re at the office party or in front of a camera, speaking their minds comes easily. But for others, the idea of having to give an interview, and a good one at that, can be daunting to some, terrifying to others. However, anyone can give a good interview. All it takes is some practice and a few tips and techniques. 1. Do your homework Research the publication, show, or website and who will be interviewing you. What are the reporter’s expertise and style?…

Changing jobs is one of the most stressful events. That’s why it’s no surprise that many people keep jobs that serve no purpose other than to pay the bills. But if it’s time to leave, rest assured there are ways to reduce the anxiety. Consider these tips if you are about to quit your job. 1. Get a realistic picture of your financial situation Most people stay in their jobs due to the steady paycheck. Take a serious look at your situation—you might be able to pull off leaving. If you’re starting a new business, you’ll need to cover living…

Dozens of people have a common question, “How can I find a mentor to help me with my business?” This is a common request because not everyone has a sister who’s a legal eagle or a father who works as an international advertising executive. As entrepreneurs, we want someone we can call on to ask a quick question but also someone to sit down with to discuss the longer, more arduous details of a deal or overall business strategy. And we don’t want to pay for any of it. Many people who think they need a partner or vendor would…

Do you have a passion you want to launch? Consider starting it as a nonprofit. When people launch businesses, they often incorporate “giving back” into their launching endeavor. Whether creating jobs in third-world countries or donating a portion of their proceeds to their favorite charity, these days, the concept of “volunteering” takes on a whole new meaning for entrepreneurs. Although there are many ways to give back to your community through your for-profit business, consider starting your passion as a nonprofit from the get-go and taking advantage of all that this structure has to offer, plus the “feel good” aspect…

If you own a business with an e-commerce platform or are considering starting one to further share your product or service, and don’t feel like it is hitting its full potential, you could benefit from specialized techniques to boost sales. These tips will help you reach more customers, sell more products, and hit new unique visitor highs! Just having an online store component to your website isn’t enough to hit the potential that your e-commerce platform has, regardless of industry or product offerings. By utilizing these techniques, you will surprise yourself with the amount of value you will get through…

With an app developer who understands and supports your business goals, you will soon enter a new world of mobile commerce that will take your business to the next level. Do you have an idea for an app in your mind? And do you want to make money off of this idea? Yes, who would not want to monetize the concept of the app, given its vast demand and scale in the digital market? To avoid any pitfalls in the app and to save money, the best solution is to hire an experienced freelance app developer. Finding a decent freelance developer is…

Brand identity is one of the most effective strategies that businesses of any size can use to gain a competitive edge. In today’s digital world, if a business doesn’t have a strong brand identity, they’re going to have a lot of trouble keeping up with their competition. In fact, in today’s highly competitive marketplace, brand identity is one of the most effective strategies that businesses of any size can use to gain a competitive edge. So with that said, in the following article, I am going to discuss top tips to help you develop a strong and memorable brand identity…

Your ads don’t do any good if the intended people don’t see them. Contextual targeting is all about serving relevant ads to the right people. When it comes to paid advertising – be that on Google, Facebook, Twitter or any other online advertising platform – it can often be difficult to run a successful campaign, especially if you’re not advertising to the right people.  But the truth is that most online consumers don’t pay any attention to the ads they see. In fact, according to a recent HubSpot study, about 64% of respondents agreed that online advertisements are annoying and intrusive.…

Consider these low-cost small business ideas if you want to start a business but are short on funds. It could be a brilliant idea to dabble in entrepreneurship in your free time. It not only creates a potential long-term income stream but also fills your time with something you enjoy. More people are starting their own businesses. In fact, many popular corporations such as Apple and Lamborghini are the results of part-time endeavors from home. Fortunately, it is easier to start your own business without spending much nowadays. There are plenty of businesses you can start with little or limited resources. Have…

There are many different scenarios that affect how an LLC is taxed and this can get complicated. But in general, the IRS treats an LLC like a sole proprietorship or partnership, and therefore it does not pay business taxes. Some states, however, may charge the LLC an annual fee. How is a limited liability company (LLC) taxed? An LLC, by default, is taxed the same as a sole proprietor. Their profits are reported on the form Schedule C, which is then integrated with the business owner’s personal tax return. An LLC also has the option to elect S-Corp status, which…

Entrepreneurs from YEC discuss their favorite market research tools and why you should be using them. In the modern age, we have a lot of tools that can offer us in-depth insights into what our ideal customers like and dislike. Using this as a basis, we can adapt our marketing attempts to appeal to those customers. The question then becomes: how do we obtain that data? Luckily, there are a variety of marketing research tools to choose from. Today, a business that doesn’t depend on market research to guide its advertising and marketing is at a distinct disadvantage over other…

There are a number of tools and processes marketing experts use to make marketing easier. In the digital age, a company not tapping into automation is losing time and productivity. Relying on human contributors to produce content is still the best approach. However, for distributing this content, automated processes, tools and strategies are always more efficient. In marketing, efficiency means a better return on investment because it speeds up turnaround time and costs less than manual methodologies. But how does a business automate its marketing? Some entrepreneurs think automation is complicated, requiring a long process to learn how to use…

These websites can help you locate fresh talent as your business grows. Alongside the boom in freelancing talent, there has been a change in how companies approach the idea of outsourcing. In recent years, businesses have seen the benefits of not doing everything in-house and are more open to hiring freelancers to lend them a hand. This new reality in the world of employment has spawned a massive explosion of websites that cater specifically to professionals providing services to companies. Many of these websites offer businesses access to a wide pool of qualified candidates, as well as the possibility of…

Entrepreneurs highlight the features and tools that help them stay updated on their teams’ efforts. Remote working isn’t anything new. Many businesses have been leveraging the power of remote workers for years. Other companies have replaced some in-house hires with freelance workers who operate from anywhere where they can have an uninterrupted internet connection. But with this year’s shift toward an almost entirely remote workforce, many businesses are struggling to find the best strategies and tools for managing a fully remote team. With change on this global scale, it’s impossible to keep holding onto the traditional way of interacting with…

Programming is in high demand in today’s digital-first world. Try these tools, courses and platforms to kick-start your team’s learning. Today’s world is all about technology, which means people who can develop software and applications are in very high demand. Many companies that need help with development have found there simply aren’t enough qualified programmers to go around. So, whether it’s languages like HTML, CSS, or Java for basic development or Python or SQL for analyzing data, familiarizing yourself with and applying even one of these languages to your work could mean big advancements for your company. Businesses that need…

Create a compelling quick pitch in advance of unexpected meetings with investors. Did you hear about the consultant that ordered an UberPool and the other passenger who turned out to be the director of business development at her dream client? How about the startup founder who took a day trip with his family and struck up a conversation with a nice guy on a bike, who happened to be an investor? What about the entrepreneur that landed a client from a conversation that started as a casual discussion while waiting in line for coffee at Starbucks? These are all true stories! The…

There are more than 30 million small businesses across the United States. That means any startup entering the market faces some serious competition, especially in crowded sectors.  An effective marketing strategy is a key to establishing a brand, reaching target customers, and ultimately demonstrating your value. And email marketing remains a vital element of any good marketing strategy. Social media might have proven itself a terrific channel for growing audiences, but email is actually 40x better for acquiring customers.  But it’s not a simple process, and no small business can just guess its way to success. So, how can startups actually…

Every day, someone comes up with a great idea that they think could make them some money. Some of the time, these ideas are good enough to get off the ground and become actualized as real businesses. However, every business needs capital, and it is for this reason that many entrepreneurs seek out investors. Where many venture capitalists dedicate their effort and time to seeing deserving businesses thrive, bagging an investor does not come that easy. Below are a few things you can do to help your startup get venture capitalists’ investment. 1. Have Fresh Ideas It’s easy to imagine…

Launching a new business brings with it many important considerations. Beyond crafting a solid business plan and securing financing, aspiring entrepreneurs must ensure their venture complies with relevant laws and regulations. Though it may seem daunting, proactively addressing key legal matters can help pave the way for future success. Critical legal steps include structuring your business entity, obtaining necessary licenses and permits, meeting tax and accounting requirements, and protecting intellectual property. With the right legal foundations in place, you’ll be well-positioned to turn your business idea into a thriving enterprise. Remember, legal compliance isn’t just about avoiding penalties – it’s…

The average cost of a particular fund can be used to define the cost of capital, which is the total composite cost of capital. The term “weighted average cost of capital” (WACC) refers to the cost of borrowing from several sources, with each source’s market value serving as the weight. The returns that each investor expects to receive are referred to as the cost of various sources of finance. The average cost of a company’s financing (stock, debentures, bank loans) weighted in accordance with the contribution each component makes to the total pool of capital is known as the “weighted…

There are two options open to you if you decide to invest in a company: equity (commonly known as stocks or shares) and debt (also known as bonds). Firms issue shares, which are valued every day and posted on a stock exchange. In contrast, bonds function more like loans where the investor is the creditor. Only businesses looking to raise capital for capital projects, more company growth, or diluting owner shares issue equity stocks. Bondholders are owed money by the business. Part of the corporation is owned by equity holders. In the event that the company files for bankruptcy, bondholders…

The statement of shareholder equity may also be referred to as a statement of stockholders’ equity. A statement of owners’ equity or a statement of shareholders’ equity are other names for this portion of the balance sheet. It provides a picture of how the firm is doing after deducting all assets and liabilities for shareholders, investors, or the business owner. What is the Statement of Shareholders Equity? The difference between total assets and total liabilities, which is often measured monthly, quarterly, or annually, is the statement of stockholders’ equity. It can be found on the balance sheet, one of three…

Accounting is essential for understanding a company’s real-time financial strength, whether it is about fulfilling short-term or long-term obligations. Together with the liquidity ratio, operating working capital (or OWC) measures the firm’s ability to meet its short-term cash demands. What is Operating Working Capital (OWC)? Operating Working Capital (OWC) is the measure of current assets required to run day-to-day business operations. OWC represents liquidity and helps to understand the company’s ability to meet its short-term obligations. In accounting terms, operating working capital is the difference between operating current assets and operating current liabilities. When assets or liabilities are employed in…

Internal and external recruitment are components of the HR procedures that businesses employ to surround themselves with the talent they need for their development. Still, they do not live up to the same standards. Recruitment agencies, therefore, choose one or the other of these approaches based on the type of profile the company wants to hire and the nature and functions of the role. What is Internal Recruitment? Internal recruitment is the process of filling open positions or replacing staff members within the organization by using the resources that are already there (retirement, for example). In order to evaluate the…

When most people think about starting and financing a small business, they probably think of bank loans. However, since the recent financial turmoil, banks have tightened their lending belts, making it much more difficult for small businesses to borrow money these days. The good news is there are plenty of other less-traditional sources of funding available to entrepreneurs. 1. Government Loans The Small Business Administration guarantees all sorts of loans, from microloans of just a few thousand dollars all the way up to 7(a) loans of $5 million. Once you get through all the paperwork and are approved by the SBA, it will…

Running a small business after bankruptcy can be difficult, especially because it can stay on your credit history for as long as seven to ten years. Just because you had a bankruptcy doesn’t mean getting a bank loan is out of the question either. With a few extra preparations, you can overcome that financial blemish and keep your business flowing with funds. 1. Address the Elephant in the Room It can be embarrassing to air out your fiscal dirty laundry with strangers, but being upfront about your bankruptcy is the best strategy. Prepare a few sentences explaining the causes of your bankruptcy…

A commercial mortgage can be the right solution for helping you buy or update your business real estate. Once you secure your funding, it’s time to decide what loan terms are best for your company. There are at least four different types of commercial loans to consider. 1. Fixed-rate Amortized Mortgages When a loan is amortized it means a schedule is created to decrease the balance over a certain time with consistent payments. A portion of both principal and interest are paid each month, with a higher percentage of interest at the start. For example, during your initial payments, 95…

Peer-to-peer (P2P) lending has swept through the small business financing scene over the past few years, quickly stepping up to loan money where many banks have backed away. While P2P loans offer some great benefits for business owners, traditional bank loans are definitely not falling by the wayside just yet. Here’s how they stack up against each other. Interest Rates Both banks and peer lending offer risk-based interest rates. Simply put, the better your credit the lower your interest rate will be. And it seems that banks tend to win the contest in this realm. Of course, when you have poor credit borrowing…

What is Peer to Peer Lending? Peer-to-peer lending, also known as social network lending, allows borrower members to borrow money through personal loans, and lenders fund these loans by investing in notes. Each note corresponds to a portion of a borrower’s loan. With the combined forces of a contracting credit market and the power of the internet, peer-to-peer lending has gained a lot of momentum. It has proven to be an effective alternative to conventional bank lending and has filled some of the void left by many of the larger banks and lenders. The Lenders and Borrowers Lenders are simply private individuals who sign-up…

So, you’ve got a million-dollar idea, but you aren’t sure how to start funding your entrepreneurial dreams. Access to capital is the largest problem for early-stage entrepreneurs, followed by access to investors. Here are some ideas on how you can gather the capital for your business: 1. Friends and Family Borrowing money from friends and family is a popular method of raising money to launch your own business. This option comes with a caveat, however—things can quickly go sour when borrowing money from loved ones, especially if payments are missed or the business fails. To protect yourself and your relationships, draft…

Most small businesses at some point or another will need more working capital than the company itself can supply. Fortunately, there are several resources available to small business owners that can provide the cash needed for daily and monthly operations. 1. Bank Loans Working capital, or the money a company needs to run its normal operating cycle, can be obtained from small business loans. Borrowers can turn to commercial lenders, credit unions, local banks and even the government’s Small Business Administration for these types of loans. The repayment terms can be as short as one-year and as long as seven years. Working capital loans…

Pitching your company to angel investors or venture capitalists can be intimidating, especially when the fate of your start-up small business rests in their hands. In preparing your presentation, keep in mind that angels and VCs are essentially looking for five key ingredients in your business plan. 1. Market Size Investors will want to know how large the market is for your particular product or service. You could have the best idea in the world, but if there is a very limited number of people who could possibly patronize your business then your product or service will never have the potential to…

Every new small business takes time to get off the ground. Data published by Intuit, says that 60 percent of entrepreneurs spend six months in the thinking, researching and planning stage before launching their new business. And 21 percent spent between one and three years of planning before ever setting foot in the market. Creating a startup means putting it all together on paper successfully first. This phase definitely requires lots of patience to be thorough rather than rushing into an exciting idea. After the planning stage is complete, the next big hurdle business owners face is coming up with seed money –…

How well you manage your small business’ working capital is a good sign of how well things are going for your firm in general. A company that can keep its accounts payable and accounts receivable moving smoothly is also likely to turn a good profit. If you feel like your company’s working capital process could use some help, take a look at the following suggestions. 1. Reevaluate Your Working Capital Needs While the economy is still making its way back to normal, things are much better now than during the Great Recession. During the financial crisis, businesses had to carefully protect their working capital…

Starting a business and bringing it successfully to maturity requires lots of cash. Fortunately, it does not all have to be provided by the business owner. As a business grows, the sources of funding expand as well. Here’s what every start-up should know about the traditional rounds of funding Seed Round After an entrepreneur gets her big idea, the next step is to drum up enough cash to put the product or service together – to actually bring the idea to life. This stage of funding is often called the Seed Round, with money coming from the entrepreneur’s own savings,…

Funding is often a major issue for startups and newer small businesses. Several loan programs are available to help entrepreneurs get the cash they need to finance the operating cycle, but borrowing money can also be costly. How can you tell when it’s a good idea for your business to take on debt? Here is a little financial food for thought: Good Debt It is a smart idea to take out a loan when the upfront money will increase your firm’s net worth or help save costs in the long run. This can include things like installing solar panels that will…

In residential lending, the lender determines how much a borrower can afford by calculating his debt-to-income ratio – how much total monthly debt he has divided by his total monthly earnings. In commercial lending, a different ratio is used. The debt service coverage ratio is the commercial mortgage equivalent of the debt-to-income ratio. What is Debt Service Coverage? The debt service coverage measures how much a business owner or investor can afford to borrow for a commercial property based on how much income the property will generate. It is calculated by dividing the net annual income of the property by…

The franchise business model has been around for at least the past 80 years—a very successful way to bring the same services and goods to people across large areas. In the last decade or so, a new trend has emerged in the franchise world, with the owner of one franchise opening up several more branches and becoming a multi-unit operator. In fact, a study from FRANdata reports that since 2005, more than half of all franchised units are operated by multi-unit franchisees. The Benefits of Multi-Unit Franchising Why the eagerness for many to operate several franchises at the same time?…

Small business loans from traditional lenders may be one of the most recognized forms of business funding, but they are certainly not the only way for firms to secure much-needed financing. Asset-based lending (ABL) is often a path to working capital for companies without the standard collateral required for bank loans. What is asset-based lending? Asset-based lending is a type of loan that is secured by the assets of a company. While traditional small business loans require collateral like real estate or heavy-duty machinery and equipment, ABL allows for much more flexible collateral. ABL lenders will accept things like the value of…

Most small businesses will need loan financing at one point or another, and local banks and credit unions can close that gap in funding. But finding the right lender can be tricky. Here are a few tips on finding the best fit for your business needs. Ask for Referrals Knowing that someone you know has already had a good experience with a particular lender is often the best way to find a bank for your business. Colleagues, suppliers and other trade partners may have suggestions for you based on their experiences. Sometimes the personal testimony of a fellow business veteran is worth…

Business loans are not the only path to steady cash flow for non-profits. Among the many different ways to finance a non-profit company is to host a fundraising event. While this requires a lot of careful planning and hard work, it can definitely pay off financially. 1. Determine the Event Type A successful fundraising activity can take many forms. Cocktail and formal dinners are popular and traditional events, but golf tournaments, 5k runs, auctions, and galas with famous entertainers are also in the realm of possibility. The potential list is endless. Your objective in picking an event should be to choose one that…

Small businesses often need commercial real estate loans to purchase property for their company. These mortgages can also be used to refinance existing loans or to get funding to redevelop properties a firm already owns. Whatever the reason, securing the loan is an important part of achieving the goal. Here are three important mistakes to avoid when applying for a commercial loan. 1. A Lack of Cash Most commercial real estate loans require a substantial amount of money for a down payment. Yet lenders will also want business applicants to have plenty of cash reserves designated for investing in the…

After the initial startup phase, most small companies will come to a point where they need a blast of cash to keep business flowing on an upward trajectory. It may be that the firm needs to invest in equipment, more inventory, or additional staff. Whatever the reason, getting a hold of more money is essential. Small business loans and venture capital (VC) are two of the most talked-about ways of securing funds. Here’s how they stack up against each other: Small Business Loan Pros Taking out a loan with a bank or other lender allows you to maintain complete ownership…

Once you have struck upon your big idea for a business and made a plan for how to begin, the next step is to raise up enough cash to get started. How do you know how much money you will need? Here are 2 strategies for determining how much you need to fundraise. Set a Goal For First-Round Funding One action plan suggests that you start with careful research to set a funding goal for your first stage of business. This includes talking with potential clients or customers to understand what they want and how much they are willing to pay for…

Many small businesses contract with large companies that take the full 120-day limit to pay their bills. The result is that small firms often come up short in terms of working capital between payments. And unless those small companies offer a product or service unavailable in the rest of the market, they have little negotiating power with the big firms. This situation makes for some tough choices for small businesses. Take a Discount These big companies will often offer payments earlier than the four-month timeline but with a discount on the total bill. In some cases, this can actually be…

So-called alternative lenders in the small business lending market have been growing exponentially since the financial crash, filling a gap in available credit when traditional lenders cut back on business loans. Yet these alternative lenders often make loans with annual percentage rates (APRs) as high as 135 percent. How could a loan with that much interest actually benefit a small business? Here are a few reasons why an alternative loan might sometimes make sense: Limited Time Bank loans can take months to secure as a result of all the necessary paperwork, proposals and background checks. Sometimes small businesses do not…

Starting and running a business requires capital. The source of that capital can be variable depending on which stage a business is in. Below is a quick rundown of the most popular methods of business financing. Angel Investors Angel investors contribute money, typically to fledgling businesses, and they do so because they want to see the company or owner succeed. The money does not generally have to be repaid, but investors may want some equity share or other remuneration. Bank Loans Banks and credit unions offer the widest variety of financing and at some of the best interest rates. These…

Business owners can refinance their commercial mortgage loans in many different ways to improve their financial outlook. Here’s a look at some of the most popular reasons to refinance a commercial mortgage: 1. Cash-Out Refinance If a business owner has accrued a significant amount of equity in the commercial property, it may be possible to pull out a portion of it as cash to be used for other purposes. This can be an effective way to finance property repairs or improvements or even provide working capital for day-to-day business needs. These cash-out refinance loans can be paid out as a lump sum or as…

When it comes to growing or sustaining your business, outside help is often needed to provide the required cash. Traditional lenders offer two helpful products for business owners: business loans and business lines of credit. Each has its own distinct merits for developing companies. Here’s what you need to know about them before making a decision: Loan Payout With business loans, a borrower receives one lump sum of money at the outset of the loan and will never receive more for the duration of the loan. With a line of credit, however, a borrower can draw out funds on an as-needed basis during…

Small businesses, especially start-ups, often suffer from gaps in their working capital. New companies often do not have the cash to stay afloat between buying inventory and collecting on their first cycles of accounts receivable. Business lines of credit can be a helpful way to cover that shortfall in the short term. A line of credit is a loan that works similar to a credit card—the bank sets a limit for the borrower, and the entrepreneur can borrow up to that limit during a specified time period, usually about a year, only making payments on the interest. After that, the borrower must start…

Having the necessary cash on hand for day-to-day operations is key to the success of any small business. It can be a fine balance to keep enough working capital in between the time you pay suppliers and the time you are paid by your customers. Here are a few ways to make sure your business has the cash flow it needs to run smoothly. Detailed Forecasting Managing your working capital starts with having an accurate picture of your cash flow requirements. It is important to take into account the typical market cycle, but also to budget in things like projections for growth…

One potential way to finance your small business’ growth is to connect with a venture capitalist, someone who can not only provide working capital for the company but also business advice and expertise. While having interested investors can be exciting, it is important to only partner with the right venture capitalist. Most investors will want to know about your business plan, your projections for growth, your profits and your margins. But the right investor will also want to dig deeper. Here’s what a good venture capitalist will want to know about your firm. Your Backstory The right investor will want to know why…

If your business is ready to take the plunge and invest in its own commercial real estate, the biggest hurdle is often finding the funding. Lenders require very detailed documentation and projections for commercial mortgages. Before you hand in your application, here are a few items to check off your list: Have you collected all the pertinent documents? Whether or not your bank requires all of these records, it would be smart to have things like insurance quotes for the commercial property and the most current tax bill from the seller or tax collector. You should have a Year-to-Date Profit &…

Entrepreneurs starting a new business sometimes turn to their 401(k) retirement savings as a source of capital when other options are exhausted. Here is an overview of how it works, potential benefits, and risks to consider. The Process To access 401(k) funds, the business must first incorporate and set up a corporate 401(k) plan. Then the personal 401(k) can be rolled over into the corporate plan without tax penalties. The business owner can direct the new 401(k) to purchase stock in the company. These funds then become available as working capital. For example, an entrepreneur rolls their $100,000 personal 401(k)…

If you are trying to secure business funding from one or more venture capitalists, it is important to speak their language. VCs may use a variety of jargon and slang that you will need to understand if you want to capture their attention. Mastering words like the following will help you avoid embarrassment when a VC asks things like ‘what is your burn rate?’ or ‘what’s the valuation of your company?’ Bootstrapping Bootstrapping means using one’s personal resources or the small business’ own revenue to fund the firm. Burn Rate The burn rate is how quickly a company is using up its available…

Perhaps your small business has only used credit cards as an emergency form of funding. Or maybe you worry that the interest rates are too high. Yet managed correctly, business credit cards can be a great asset to your firm, even simplifying your bookkeeping and making your financial records work much more efficiently for you. Simplified Statements If you start making all of your business purchases with your company card, keeping track of your finances will be a piece of cake. Your monthly credit card statement will have a list of all your transactions, eliminating the need to search through mountains…

Finding funding is the main priority of most new small businesses, and fundraising is often the focus of non-profit organizations. There are many ways to fundraise, but the key to success is keeping your whole team focused as you implement a carefully-planned strategy. An effective strategy starts with the right attitude. Instead of feeling like you are begging for money, think of fundraising as developing partnerships with donors, and connecting people with your cause. The rest of a winning strategy might include things like: 1. Defining Your Funding Pitch Donors will want to know exactly what your organization is about and how…

Paying for business equipment upfront is often too much for many small firms to handle. Yet almost every small business needs equipment, whether it’s computers, machinery, or even an office space. Leasing is one way for companies to get the equipment they need without the huge initial outlay of cash required for purchase. And it’s a popular choice too. The Equipment Leasing and Finance Association reports that four of five businesses lease at least some of their firm’s equipment. Leasing essentially means renting equipment from a lender. There are typically more options involved with leasing than the term “renting” implies,…

Getting past the start-up phase in any small business is a major accomplishment. But it is no time for resting on one’s laurels either. Expanding an established business means finding another round of funding. Where is the best place to find expansion financing? 1. Funding from family members It may surprise you to know that the majority of small businesses use their personal assets or obtain extra funding from family members. According to the 2007 Survey of Business Owners (SBO), 51.2 percent of small employers kept financing for expansion within the family. This is certainly a nice option, if available, to…

Finding funding for a small business startup can be a difficult challenge. And if your personal credit score is less-than-perfect that process can seem even more grueling. It is definitely not impossible though. The path to funding might have to be a little more creative, but the following tips can help your business overcome your past credit foibles. 1. Borrow From Friends and Family While it may be uncomfortable, family and friends are often the best places to start for small business financing. They care about you and want to see you succeed. Rather than judge you by your credit score, your…

Mortgage interest rates have been at or near record lows for the past several years, but experts are predicting that rates will see definite increases this year. As mortgage rates rise, other lending rates like those for small business loans often follow suit. A jump in interest rates can profoundly impact both current and potential small business borrowers. 1. Increased Cost of Debt When interest rates rise, the cost of borrowing money increases for both lenders and borrowers. Banks and other lenders frequently borrow capital themselves from larger institutions like the Federal Reserve in order to have money to lend…

Your small business is doing well – you have enough cash on hand to cover expenses, and sales are increasing. Getting a small business loan may be the last thing on your mind. But this might actually be the perfect time to apply for one. It is an unfortunate and paradoxical fact that loans are easier to obtain when a firm is doing well financially than when it is struggling. So if you have found yourself in a commercial sweet spot for the moment, here are a few reasons you might want to take advantage of the timing to get a line…

Your start-up or newer small business needs cash to get off the ground. Attracting the capital you require is no easy feat. Among the many sources, you can try are angel investors – individuals who invest in fledgling companies, bringing funding and expertise. In order to score a partnership with an angel, entrepreneurs need to know what these investors are looking for. Good Recommendations Angel investors are often most interested in businesses recommended to them by friends or colleagues. Networking is essential to finding the right financial backing. Reach out to all your local business partners and contacts. Ask if they know anyone…