Author: Editor's Desk

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Strategy

How to Evaluate Your Small Business Marketing Plan

Ingredients to Evaluate Your Marketing Strategy

How do you know if your marketing plan is working out or not? 

How to improve your marketing campaigns?

The success of a small business marketing plan depends upon 3 key factors:

  • Developing a strong plan
  • Executing it effectively
  • Evaluating the plan to measure its effectiveness

Evaluating your small business marketing plan is very essential for an entrepreneur, as it helps the business owner to know which campaigns and strategies are working well, and where to focus his time, money and energy to get the best results.

Here are 6 smart ways to evaluate your small business marketing plan:

1. Brand Recognition & Establishment

Grabbing people’s attention, getting people to know your business & brand, and building a relationship with your customers should be the first objective of your marketing plan.

This can be measured by finding out:

  • The size of your fan base on your social media handles
  • Mentions of your brand name on social media sites
  • The number of positive reviews left by customers about your company on social media as well websites like Google Reviews
  • Inbound website visitors from social media handles
  • Total number of conversions resulting from traffic generated through social handles or any other form of advertising

By analysing these factors, you can determine what form of engagement is working to your benefit and how you can drive it further. Increase in traffic on your website and social media handles, retail channels or enquiries on your website/call centre means that your marketing campaign is working out well.

2. Lead Generation

Not all marketing efforts are directed towards generating sales, however, marketing plans must fuel the sales funnel of the business by generating leads.

How to evaluate your small business marketing plan in terms of lead generation:

  • Increase in subscribers to your mailing list
  • Increase in appointments
  • Increase in customer response for your products or services

You should set quantified goals to track & measure your leads generated over the period of a week, a month and a year. 

3. Reviewing Sales Numbers

This is simple: Sales should be going up!

Reviewing your sales numbers is fundamentally the fastest way to determine the effectiveness of a marketing campaign.

For example:

If pre-marketing campaign sales of your company was Rs.500,000 and after the marketing campaign, the sales increased to Rs.800,000, it is a safe assumption that the campaign was effective and your sales have grown due to its effective execution 

4. Customer Response

Customer response in any or all its varied forms can help you determine the type of reaction your marketing activities create. 

  • You can create a funnel for surveys that can be posted online or taken in person from the customers. Customer feedback can help you figure out the reaction & impact of the marketing campaign on the consumer
  • Ask Simple Questions such as:

’How did you hear about us? 

How did you find out about our seasonal sale?

Will you try & recommend our product?

Such simple questions can reveal which marketing initiatives are reaching the right customers.

5. Business Expansion

When your marketing plan is working out well, your business begins to grow with more customer calls, fresh leads, sales and expansion

  • Good marketing campaign makes each customer, employee and stakeholder a marketer of your brand.
  • When you start getting customers from new regions and geographies, it simply means that your marketing plan is working well!

6. Return on Investment

Return on Investment (ROI) is one of the top concerns of any business owner, when it comes to running marketing campaigns.

  • The idea of knowing the ROI is simply to find out whether the amount spent or invested in a marketing campaign has resulted in a profit or not.
  • This can be measured by comparing the amount spent on the campaign versus the amount of sales each campaign has brought in specifically.

A business owner must consistently and carefully evaluate its small business marketing plan to spread brand awareness, spend wisely on activities and maintain its growth momentum.

If the objective & outcome of each marketing campaign has been defined clearly, business owners can not only make smarter marketing decisions but convert potential leads into life-long customers much faster. 

Categories
Strategy

Strategies to Make Your Product Stand Out

Make Your Product Stand Out in 3 Simple Steps

Do you think your company has a unique product & offers?

Here’s the truth; you probably don’t, and there is nothing wrong about it.

Some of the world’s most successful products are not totally new, original or unique. Take the classic example of Google. Google’s founders ’ Larry & Sergey didn’t invent the search engine, yet the one they found out is generating crores of rupees in profits.

This is because they differentiated their product from the sea of other search engines over the years.

So, if you want to truly differentiate and make your product stand out from the crowd, here are 3 proven tips to help:

1. Target Audience: Define your perfect audience

’If you try to appeal to everyone, you will end up appealing to no-one’

Defining and choosing a specific target audience helps you make your product stand out from the rest, as long as you don’t choose the same target audience as your competitors.

For example:

  • McDonald’s target audience includes students, employees and professionals within the age group of 8 to 45 years, belonging to low & middle-income groups and having an easy-going personality.
  • Facebook: The target audience of Facebook has evolved with the company. In the initial years of its operations, Facebook targeted college students of the United States. 

But now Facebook has widened its target market focusing on millennials (25-34 years) and mobile using adults in 157 countries.

Choosing a specific audience for your brand is a start, marketing is the next step.

Marketing that doesn’t hit its intended target audience is classified as a waste, and marketing that does hit its target audience is classified as effective & efficient. The key here is to give your target audience something that interests them.

  

  

2. PSP Formula: Problem Solving Product (Value Proposition)

’You don’t grow when you try to make money, you grow when you try to offer the right value to your customers’

– Dr. Vivek Bindra (Founder & CEO, BadaBusiness.com)

Your value proposition tells your customers at a glance, what you do, and how you’re different & perhaps better from your competitors. 

It might not be the actual features that make your product standout from the crowd, but the way you deliver your service or a disruption brought about by you in a traditional function (think Ola Cabs or OYO rooms, for example)

Examples of Strong Value Proposition include:

Twitter: ’See what’s happening in the world right now’

Khan Academy: ’You can learn anything’

WeWork: ’Space to elevate your work’

These are all recognizable statements from companies that stand out from their competitors in their respective industries for their branding and positioning. 

Having clarity on what your value proposition is and what makes your business unique will help your customers understand what’s unique about your brand too and make your product stand out.

3. Customer Service: Providing consistent & quality customer service

Your product is only one half of the equation in making your brand stand out. Strong customer support & service is the other half.  A perfect balance between the two decided whether the consumer will make the initial purchase from you and whether they’ll continue to buy from you in the future.

  • Statistics shows that 45% of customers will immediately exclude products that come with additional shipping fees during an initial product search.
  • Similarly, other areas that matter includes warranty coverage, fast shipping, and hassle-free exchange & returns.

As a brand, your goal should be to provide consistent & high-quality experience to your customers, right from the moment a customer places their order till it reaches them at home.

Making your product stand out from the competition is getting more challenging nowadays. But it’s also becoming a necessity. Starting with these 3 fundamentals will help you breakthrough.

As the marketplace gets crowded, business owners need to leverage all the moving parts of their business in order to survive. Focusing on your target audience, the value proposition of your product and excellent customer service will help you make your product stand out among an increasing sea of sameness.

Categories
Marketing

Advantages of Having a Mobile App for Business

Look at what you’re missing if you don’t have a mobile app for your business!

What is the one thing today we can’t live without?

It’s our smartphones. According to recent research, people spend an average of 3 hours and 15 minutes on their phones with millennials spending 5.7 hours per day. People check their phones 58 times a day on average with more than half of those occurring during working hours.

Businesses from all over the world that offer a varied range of products have moved on to mobile applications, and if the increase in smartphone usage should make you do so too! If you want to prepare for the future, you’ll need a mobile app for business.

Here are 5 benefits of mobile app for your business:

1. Provide More Value to Your Customer

Business is all about adding value in the lives of your customers, which they can’t get anywhere else by solving their burning problems.

One of the ways to do this is by creating a loyalty program for your customers within your app. How does this work?

  • The more customers interact with your business and your product, the more loyalty points they earn, which can be used for great deals or cash backs on the products they already know they want.

For Example: 

Starbucks uses their mobile app for business to their advantage by offering rewards exclusively to their app subscribers, which then motivates their customers to buy more coffee from them.

Similarly, you can create such loyalty programs that have app exclusive offers for your customers in your mobile app for business.

2. Personalised Content

  • Studies show that users love personalised content for a fascinating experience.
  • Offering personalised content is like offering a tailored or customised communication in the language that your users speak and understand and the users love it.
  • Mobile apps make it easy to cater to personalized experiences, which can be based on your customer’s interest, behaviour, location, culture, etc.
  • The application will observe their habits, behaviour and engagement, filter updates for them depending upon their actual location in real-time

3. Push Notifications and Instant Updates

The ability to send instant and non-intrusive notifications to your app users is one of the primary reasons why companies should build a mobile app for business.

  • When your user opens an app on their device and receives a notification, it is called as In-App notification.
  • On the other hand, push notifications are received on the device regardless a user opens an application or not. 

Moreover, you can send regular updates of your application with all the latest features, images and your product listings via play store, iTunes and windows store. 

It will also allow you to promote your product and services regularly, leading to an increase in sales for your business.

4. Branding and Design

’Your mobile application becomes your business’ brand ambassador’

A mobile app for business is an effective tool for building your brand awareness and recognition.

  • Your mobile app for business works like a blank billboard sign. A business owner can do whatever he/she wants; make it stylish, functional or informative. But what you would really want to build is an app that your customers would love, while at the same time it’s well-designed & easy to navigate serving your purpose well.
  • How soon the customer will be inclined to buy your product is directly dependent upon how often you can get your customers engage with your app.

5. Interactive Engagement

This is one of the most important benefits of a mobile app for business. 

Communicating to the customer is essential for marketing, reverse communication is equally important for businesses to maintain customer loyalty.

  • Studies have shown, customers feel wanted when their complaints and their concerns are heard out and resolved within a limited time frame. This helps businesses build a loyal customer base and brand loyalty.
  • Mobile app for business helps to maintain the critical relationship between customer and the business through online help desks and support systems.

The increased accessibility of your product and services to the customers combined with reduced cost is a cherry on the cake to build customer engagement.

Other Benefits of Mobile Apps:

Apart from the above-mentioned benefits of mobile app for business, there are a few critical differentiators of adopting a mobile app strategy.

  • Access to analytics and data on how people interact with your app
  • Location data: Where most of the people are purchasing your product
  • Stand out from your competitors
  • Reach out to a younger demographic

90% of the companies plan to increase investment in mobile app for business in 2020, and if you don’t, there’s a good chance your competitors will get ahead of you.

Entrepreneurs should know that if they want to focus on customer engagement and build a loyal user base, mobile is the way forward. The power in their hands can make all the difference!

Categories
Marketing

5 Proven Ways to Improve Your Video Marketing Strategy

How to Build a Unique Video Marketing Strategy!

The year 2020 marks the rebirth of video marketing. More than 50% of customers want to see videos from companies & brands, more than any other type of content. A video marketing strategy is within the reach of virtually every business despite its budget & size.

Videos are capable of increasing conversion rates by over 80% on the landing pages.

Here are 5 steps to build a perfect video marketing strategy for your business to enhance your brand:

1. Identify your Goal

The first step in order to creating a perfect video marketing strategy is to know & assess your video’s goal.

Every decision taken during the video creation process will lead back to your video’s end goal and what action you’d like your audience to take after watching it.

What’s the goal?

  • Is it to increase brand awareness?
  • Is it to sell more event tickets?
  • Launch a new product?
  • Ultimately, what action do you want your viewers to take after watching the video?

How will you determine the success of your video?
 

Decide several key performance indicators that match with your video goal, to determine the success of your video.

2. Focus on Your Target Audience

Now that you know what the goal of your videos is, it’s time to figure out who is your audience 

This is a very crucial step; if you create your videos without a specific audience in mind, it is going to fall flat. Your target audience will not get to watch it and those who watch it accidently won’t result in a conversion.

If you want to very specific on who consumes your content, then you would need to analyse the buyer persona. They are mostly used by B2B companies and are subsets of the ideal customer profile.

To finalize your target audience strategy, just make sure you know where your target audience hangs out
’ this will help you with right distribution of your video.

3. Provide Incredible Valuable Information

Quality content was and will continue to dominate if it reaches the right audience. Once you understand who your target audience is, you should start working on creating incredible valuable content for them.

What does your audience want to see? What is the burning problem of your audience?

  • Make the effort to study & understand what your audience wants. This can add a huge amount of value to your content, as your content will be relevant & informative for the audience.
  • Listen to your audience through your social media conversations, questions, replies, and through frequently asked questions from your support inbox.

How to create an impactful video?

  • Start with a Strong Hook Statement
  • Include data to support rational mind
  • Include stories & examples to engage the visualization of the mind
  • Focused Central Message 

4. 10x Your Content Marketing Consistency

Since more and more businesses are realizing the value of a well-developed content marketing strategy, competition in the space is increasing.

  • One of the most important ways businesses can distinguish themselves from their competitors is by increasing their content 10x i.e. by providing valuable content consistently to their audience.
  • Providing high-quality consistent content helps businesses enhance their brand and establish themselves as thought leaders in their industry.

Consistency in your content has a direct influence on your brand’s credibility. The more consistent you are, the more credible your brand becomes.

  • Consistency builds brand awareness
  • Engages the audience
  • Helps in generating leads
  • Improves website traffic and SEO

5. Measure Your Performance

Test. Analyze. Modify. Retest.

If you want your video marketing strategy to work, then you must test, analyze, modify, and test again.

You need to produce, release, then review your video’s engagement data in the same way as you do to track key performance indicators (KPIs) for written content.

This data will help you justify the investment that you’re making in videos and gauge the performance of the videos as well. 

Hence, the bottom line is ’ overall strategy and data should drive your video marketing strategy.

Video marketing strategy is very useful particularly for startups and small businesses as they want to get recognised fast and build a recall in the minds of the consumer.

Follow these 5 steps to enhance your brand through the right video marketing strategy and see the wonders visual treatment can do for your business.

Categories
Finance

Advantages of Tally in a Small Business

स्टार्टअप

Automate Accounting with Tally!

If your business still uses manual systems for accounting and data entry, you may end up spending a lot of time keeping a track of paper documents, finding useful information and keeping your details secure. 

To survive in today’s competition, it is essential that your business adapts to the current technological trends by using tools that give you deeper insights about your business & strategy.

Small businesses usually hesitate to switch to an ERP even though they have the financial capacity to do so. Below are some of the advantages of tally that can do wonders for your business:

1. Multipurpose Use
 

Small and medium enterprises (SMEs) need ERP software to manage 3 essential functions of the business:

Tally for small business
is a one-stop solution and can be used in all these areas with its easy-to-use interface that manages complex activities of the software in the background, without any chances of errors.

2. Facilitating decision making

Since Tally seamlessly allows to manage accounting, inventory and compliance of business within a single software, its becomes easier & convenient for a small business owner to assess the financial impact of various functions on their business and take day to day decisions based on data. 

Tally for small business acts as the backbone of your company by providing estimates, detailed analysis, and overview of your business at your fingertips, which can further help in the decision making process that can boost the growth of your business.

3. Instant access to records

Small and medium enterprises need to monitor the cash flow and revenues of their business before making decisions, as they are typically hard-pressed for finances.

For Example
Decisions like whether to take a loan from a bank or other sources.

One of the advantages of Tally is that these critical business decisions can be taken, just by looking at the financial reports of the business available at the click of a button.

4. Inventory management

Small and medium enterprises need to keep track of their inventory data i.e. the current inventory in hand, to ensure that the business is not investing heavily in maintaining inventory by paying huge interest costs.

  • Tally for small business provides Stock Ageing report which helps manage inventory in the business.
  • Small business owners can take decisions such as giving new purchase orders to suppliers, based on stock clearance status by simply looking at the report.

5. GST ready

GST filing has become a monthly affair for small and medium enterprise business owners, since its introduction.

  • To file GST return without any hassle, small and medium enterprise business owners need a software for recording business data in GST compliant formats.
  • Tally ERP software is GST ready, giving business owners an advantage over their competitors by enabling them to become GST compliant.

6. Remote access to data

Tally enables a business to give remote access to the employees of the organization.

For example, An inventory manager who works from a warehouse location and not the office location could get access to appropriate information so that he can generate delivery challans using Tally at the warehouse itself.

Employees can get access to all the data by simply logging in using a unique ID and Password.

7. Acts as an Audit tool

Tally acts as an audit tool for compliance as it helps out in conducting regular audits of different companies.

Tally for small business does a thorough compliance check at the beginning of the financial year and ensures all monetary transactions are smoothly being carried out in the business.

  • With the help of Tally, Tax consultants can remotely perform audit without the hassle of transferring data.
  • For better coordination, auditors can leave their comments on the vouchers and business owners could take further action as required.

8. Multi-user

Tally enables business owners to manage multiple functions with multiple user logins. Owners can assign different access rights to their employees based on the data used to run the business.

Tally for small businesses enables its users to work remotely with accounts of multiple companies simultaneously and update the information in real-time as soon as the voucher entries are made.

Tally software has helped many small and medium enterprises to manage their tasks cost-effectively by saving time & increasing efficiency

There are multiple advantages of using tally, facilitating the digitization of bills and signatures, making business transactions a task of seconds.

With the aid of Tally, even a small shop owner can manage bills, customers, inventory, and daily financial transactions more effectively.

Categories
Process & Business Expansion

5 Business Automation Tools to Grow Your Business

Work from Anywhere, Anytime!
 

Have you ever thought of a scenario where you are on a holiday, sipping your favourite drink and your business back home is not only running smoothly but also generating revenue? 

Yes, it is possible! Automation in business gives an entrepreneur the advantage to create more value for himself and his customers. 

As a small business owner if you are not leveraging the power of technology, then in all probability you must be micromanaging everything in your business. In that case, as weird as it may sound, you are in all likelihood just like any other employee in your company with the fanciest title.

The advantages of using business automation technologies
are many. It helps:

  • In leveraging an entrepreneurs time
  • It reduces the time in completing a task
  • It increases the efficiency and productivity of employees
  • Business owner can focus on other important aspects of the business like customer service, innovation, strategies and revenue generation.

With the ever changing landscape of business, business owners need to develop the ability to adapt and use the power of technology and automation in their businesses.

The top 5 Business Automation Tools are-
 

1. Make a Repeatable business model

The model is applied to new products and services for the generation of sustained growth in the company. 

It can be achieved by enabling the people of your company through processes and technology.  

The best example of a repeatable business model is of DMart. The company enjoys the market capitalization of Rs.114,000 crore. Over the years the company has focused on building a good team, robust process and technology. 

2. Smart Marketing

As the name suggests, many B2B and B2C businesses swears by the smart marketing formula. 

Smart marketing not only helps business owners to increase their sales significantly but also allows unlocking their time.

Examples of smart marketing tool-

a) Facebook ads/Instagram Page

Facebook and Instagram are the most popular social media platforms. While Facebook has the largest user base across the globe, Instagram enjoys immense following amongst youngsters.

Both Facebook and Instagram are widely used as an advertising tool that allows you to reach directly to your specific customers based on their interests, gender, age and location.

The icing on the cake is that it is cheaper than the conventional modes of marketing.

b) LinkedIn Ads

If you want your business to get the visibility in the world’s largest professional community then LinkedIn ads are the best and the only bet. 

It helps in creating awareness about your brand, generating leads and increases engagement with your potential customer on a global professional platform.

3. Mail chimp

Mail chimp is a powerful marketing software. It is a tool that redefines the conventional way of connecting with your group of customers. 

With the help of this business automation tool, you can boost your email marketing efforts. It helps you in sending newsletters to thousands of recipients who have signed up for it in one go. 

It also helps in automating your email campaigns and collect leads for your business.

4. Technology

Technology in business is the best enabler. It helps in business automation and reduces operational costs. 

Few examples of popular business automation tools are:

a) ERP-

Enterprise Resource Planning is a centralized database that puts the important parts of business on automation.

ERP can be implemented across the departments of an organization be it Sales, Marketing, Finance, HR, Inventory Management etc.

b) Zoom- 

It is video conferencing platform which is used for conducting video conferencing meetings, webinars, audio conferencing, recordings and live chats from anywhere.

This business automation software saves travel time, helps in better communication, increases productivity without any physical infrastructure.

c) Cloud based Services- 

It is a system where the hardware and software hosted by a 3rd party. It is a service that can be accessed from any location freely through an internet connection. 

This business automation tool is cost effective and improves functionality of your business. 

For Example: Dropbox, Google Apps, Amazon EC2 etc.

5. CRM

Relationship with customers is the most important thing in the business world. To maintain a record of thousands of customers can become a cumbersome task at times. Customer relationship management (CRM) software eases out this process for business owners. 

This powerful business automation tool not only automates the whole process but also collects data from other sources as well.

If you are a small or medium-sized business, it is critical for you to implement these business automation tools to increase efficiency and productivity enables by tech today.

Categories
Process & Business Expansion

Phygital- Redefining the Customer’s Shopping Experience

Shop till you drop with Phygital

Imagine a shopping experience where you just enter the store, pick up what you want and simply walk out. Yes, you read it right! No lines, no checkouts, no payments just walk in, grab and go! Welcome to the world of Phygital.

4 years ago when e-commerce giant Amazon launched it’s first ’Amazon Go’ store, it redefined the entire Customer’s shopping experience. With their ’Just walk out technology’ Amazon Go became the first store of its kind where no checkout is required. 

The Amazon Go app allowed the customers to enter the store, browse through its products and then leave. What bliss for people on the go!

Defining Phygital

  • The marriage between the usages of intelligent technology to boost customer’s shopping experience is the new norm today
  • It is an ecosystem where both physical and digital co-exists.

Both the worlds complement each other in the sense that the consumer experience is not just limited to their computer or mobile screens but makes it way into the vicinity of fancy stores as well. 

The objective of both the premises is to enrich customer’s shopping experience
which has a direct impact on revenue generation and business growth

Importance of Phygital in business growth

With technology and innovation taking center stage of every business, companies now have become more focused on giving its consumers a world-class shopping experience be it in physical store or in the digital domain. 

In an age where time is money, a consumer needs the holistic experience of both the worlds (digital + physical) before buying a product.

In retail, through Phygital a customer can experience the following things:- 

  • look and feel the product
  • Browse through a plethora of options
  • Take feedback
  • Enjoy easy transactions through mobile point of sale units
  • Guided layout to add value to overall shopping experience
  • Virtual add-ons
  • No need to stand in queues 

After making a mark for themselves in the e-commerce space, brands like Lenskart, Myntra, Nykaa, Firstcry.com understood the need of giving this ’wholesome’ shopping experience to the customer.

It allowed brands to move from online to offline seamlessly. It helped them in increasing their offline reach to the customers and in turn helped in their business growth.

The Way Forward

Taking a cue from the retail giant Amazon, back home in India, Dmart also followed suit. 

In its new store format, customers can place their order online or through the app. They can then collect their purchases from the DMart Ready stores, or have it home-delivered for an additional charge. 

Clearly, the idea behind the new format is to provide shopping convenience to customers and to tap into the e-commerce category as well.

Small business in tier2 and tier3 cities should focus on the smooth transformation of their stores/shops into new age customer engagement hubs. 

Tip:

  • A small businessman can create a basic website or app, through which he can accept orders online from customers and customers, can pick up their order from the nearest physical store without having to wait or stand in the queue.

Great opportunities lie ahead for businesses that have a hold in smaller cities. 

Tip:

  • Small businesses should look for the collaboration with online giants like Flipkart, Snapdeal to open their physical stores and target offline customers for their business growth.

The Phygital trend which is catching so fast is here to stay for 2 simple reasons- 

  • In Phygital, physical comfort meets digital convenience
  • Speed meets personalization

Phygital has enhanced the overall shopping experience of a customer by multiple notches and has been an integral strategy for the business growth of many brands. Offline and online stores which were once perceived as opponents, Phygital has surely blurred the lines between the Bricks and the Clicks.

Categories
Finance

5 Essential Accounting Terms for Small Business Owners

Everything You Need To Know About Small Business Accounting

How often do you end a call with your accountant feeling more confused than you were before?

If you response is ’almost every time’ have no fear!

We’ve compiled a list of 5 most crucial accounting terms for small business, along with the technique to understand them with regards to your business  

1. Cash Flow

Cash Flow = Money Flowing In & Out Of Your Business

Most of the small businesses fail not because of the lack of sales or profit, but because of lack of cash in their business.

Cash is not the same thing as revenue. Sales occur when a business sells a product or renders a service, but the cash comes in the business when the company collects payment from the customer.

Being cash flow positive
 i.e. having excess cash in the business means:

  • Business is better equipped to keep up with the debt
  • Business can cover unforeseen expenses
  • Business can invest in growth opportunities

The activities that affect the cash flow of business are:

  • How quickly customers payback the company
     ’ the faster they pay, the faster cash comes in the business
  • How slowly the company pays back to its vendors
     ’ the slowly these bills are paid, the more cash is retained in the business. But you have the credibility to build too, hence this should be done within a 45-60 day cycle depending on your terms with the vendor
  • The inventory size and how many times it rotates in a year
     ’ the larger the inventory, the more cash needs to be invested in the inventory.

2. Variable & Fixed Expenses

Variable & fixed expenses are very simple but extremely important accounting terms for small businesses.

Variable expenses can increase or decrease depending upon the company’s production output in a month i.e. they rise as production increases and reduces as production decreases.

Fixed expenses remain the same regardless of the production output in a month (e.g. office rent, employee salary, etc.)

  • Small businesses should try to keep more expenses as variable and only a few expenses as fixed, to make higher profits.
  • Unused resources like employees not being able to produce at their maximum potential because the pace of the business alternates, hence such resources can become a real drag on the bottom line.
  • Businesses should try to keep such expenses as a variable by using seasonal workers, freelancers or other third-party resources, only paying them when they work.

3. Depreciation

Many business owners feel that depreciation is a complicated accounting term, which is a completely wrong perception.

Depreciation is the decrease in the value of an asset over time due to its wear and tear, new technology or market conditions.

  • Common assets that a company can calculate depreciation for includes tangible assets like machinery, vehicles, furniture, buildings etc. and intangible assets like patents, copyrights, computer software, etc.
  • For example: If a company purchases a vehicle costing Rs.500,000 and the expected usage of the vehicle is 10 years, the business might calculate depreciation on the asset at Rs.50,000 each year for a period of 10 years. 

Depreciation is an income tax deduction. By decreasing the value of the asset, your overall taxable income lowers, and hence, your tax liability decreases.

4. Cost of Goods Sold (COGS)

COGS or Cost of goods sold refers to the expenses that are directly related to the creation of the product or service of the business.

In simple language, the accounting term COGS refers to the direct costs of producing the goods sold by a company. 

COGS includes cost of the material & labour directly used to create the goods or services, and excludes indirect expenses such as distribution costs and sales force costs.

How COGS affects Business Income:

Accounting term Cost of goods sold is a business expense, just as cost of doing business. As COGS increases, the company’s profit decreases, resulting in reduction in the tax liability. 

But a business owner should keep in mind that increasing COGS means that the business doesn’t make much money overall, hence COGS should be managed efficiently to increase profits.

5. Gross Profit Vs Net Profit

Profit is the amount of money your business makes. The difference between gross and net profit is that expenses when subtracted form gross profit gives us the net profit earned. 

  • Gross profit is what remains after deducting cost of goods sold from your business’s revenue. Gross profit is your business’s profit before subtracting business expenses.
  • Net profit is what remains after subtracting all operating, interest, and tax expenses, in addition to deducting your COGS from revenue. 

To calculate net profit, you must know gross profit of your business. Small business owners should always try to increase their gross profit by reducing their cost of goods sold.

Accounting terms, Gross & net profit are both key indicators for measuring performance of a business as an industry benchmark or its competitors.

If you understand these 5 key accounting terms for small businesses, it can help you manage your accounting in a more efficient manner helping you build your enterprise.

Taking the time out to understand these accounting terms for small businesses is well worth your while and can set you up for future success.

Categories
Process & Business Expansion

5 Fastest Growing Industries to Start a Business In 2020

What industries should excite you in 2020?

Are you planning to start your new business venture?

You must be wondering if you have your eye on the right industry or not?

Starting your own business is not easy. There are so many things to consider, from market demand to competition, but it will all be worth it. 

To help you drive the wheel towards the road to success, we’ve rounded up 5 fastest growing industries to start your business in 2020:

1. Ed-tech

Data Points for the Industry:

  • From 2014 to 2019, more than $1.8 Bn has been invested into Indian ed-tech startups.
  • The sub-segment of test preparation has the highest capital inflow & the greatest demand in India.
  • India’s tech economy growth has also pushed the demand for skill development solutions.

If educating people is something that you’re passionate about, Ed-Tech or Educational Technology may just be the startup industry for you.

The growing popularity of online learning has provided a major push to 3 of the top subsectors in the edtech market:

  • Test Preparation (from k-12 to entrance exams)
  • Online Certification
  • Skill Development

What’s the upside of Ed-Tech industry in India?

Fundamentally, India is one such market where there is a lot of focus on education. Most parents aspire to see their children aim high in education, and hence, people are willing to pay for these services. 

  • As per a study conducted by KPMG, the estimated market size for the ed-tech industry i.e. online certification and the reskilling industry is estimated to be $463 Mn (2021) growing at a CAGR (compounded annual growth rate) of 38% since the year 2016.
  • The key theme and major advantage for the ed-tech industry is: Personalisation and Inclusion
    .

Ed-tech is considered as one of the fastest growing industry in India.

2. HealthTech

Data Points for the Industry:

  • Indian Health-tech sector recorded a total funding of $586.93 Mn in the year 2019
  • Indian healthcare market to be valued at $372 Bn by 2022.
  • Some of the popular healthtech startups are CureFit, PharmEasy, Practo, etc.

Increase in population, changing lifestyles and environmental instability pose newer challenges, as new diseases appear. To tackle these challenges and focus on mass scale solutions, it is important to encourage technology & automation in the Indian healthcare sector.

What’s the upside of HealthTech industry in India?

  • Indian healthcare industry is growing at tremendous pace and is considered as one of the fastest growing industry due to increased penetration of technology, improved connectivity and enhanced healthcare policies.
  • Indian healthcare market is expected to grow threefold to Rs.8.6 trillion by 2022. 

3. FinTech

Data Points for the Industry:

  • India is experiencing a ’FinTech Boom’ by emerging as the world’s second largest fin-tech hub.
  • Indian Fintech sector received a total funding of $3.18 Bn in the year 2019
  • Some of the popular Fintech companies are Paytm, PhonePe, Google Pay, Cred, etc.

For years, FinTech (or Financial Technology) has been a hot startup sector and one of the best industry for business in India. The digital payment space in India is set to witness interesting times as WhatsApp
, the global messaging app, is coming in a phased manner with its payment services.

What’s the upside of FinTech industry in India?

  • As per Deloitte & CII’s Vision 2020 report, India is speedily heading towards becoming a digital economy with over a billion mobile phones, 330 million internet users, and 240 million smartphones.
  • B2B startups in FinTech industry are climbing the ladder
  • Some of the other areas where Fintech businesses are moving in 2020 includes taking insurance to the masses & a new wave of Fintech in education.

There is no doubt that competition in the fintech industry will intensify in the year 2020, however, it will still remain one of the fastest growing industries in India.

4. Gaming

Data Points for the Industry:

  • Smartphones accounts for a majority of online gaming revenues in India
  • India fantasy sports operators witnessed a 7 times growth since 2016, while the user base grew 25 times in India
  • 250 Mn online gamers and game developing companies were recorders in the year 2018, while the numbers were 20 Mn and 25 Mn, respectively in 2010.

Today, gaming industry has grown to become one of the biggest in the entertainment sector in the world and is considered as one of the fastest growing industry.

With smartphone penetration at its peak, the Indian gaming market ranks 5th among the world’s top mobile gaming markets. 

What’s the upside of Gaming industry?

  • Gaming industry was estimated at more than $150 Bn in 2019, and this figure is anticipated to grow to nearly $200 Bn by 2022, with a CAGR of over 9%.
  • The impact of mobile gaming is nowhere more evident than in India, where it always has always been considered a niche form of entertainment.

Games such as PlayerUnknown’s Battlegrounds (PUBG), FarmVille, Candy Crush Saga, and Clash of Clans, with social and multiplayer components, only furthered the trend, making gaming one of the fastest growing industry.

5. Data Security

Data Points for the Industry:

  • The Indian business ecosystem’s poor data security is no secret
  • The BYOD (Bring your own device) work culture is now prevalent across many offices and workplaces in India
  • India business & enterprises don’t have adequate visibility into their cybersecurity health

The more time people spend online, the more they are exposed to data breaches & violations of digital privacy. 

Due to major data privacy thefts & scandals like Cambridge Ananlytica, companies and consumers have now become more aware of these risks.

What’s the upside of Data Security industry?

  • Data privacy breach makes Cyber Security one of the fastest growing industries and creates endless opportunity for entrepreneurs and business owners willing to bet on cybersecurity and data protection as a business.
  • According to a report by PwC, the cyber security market in India is expected to grow from USD 1.97 billion in 2019 to USD 3.05 billion by 2022, at a CAGR of 15.6%

Though Data Security is one of the fastest growing industries, but starting a cyber-security company is no easy feat but the starting point could be by offering consultancy services to local companies.

If you’re thinking about starting a business soon, be where there is enough sunrises. Be a part of those sectors where the next wave of growth will come from.

We have given you a lowdown of the 5 best industries for business in 2020 and should be well considered when establishing a new business 

Categories
Strategy

3 Important Tips To Improve Your Logistics Strategy

Improve your Logistics Strategy & gain Customer Loyalty

’The sustainability of your business isn’t just based upon acquiring new customers, but also on your ability to maintain a loyal customer base who buy from you time-to-time’

Every business owner knows that the cost incurred to acquire a new customer is always way more than to keep an existing one 

To create a loyal customer base it’s essential to build a reliable & best logistics strategy. Here are 3 tips to build a consistent logistics framework

1. Preparation is the Key:

Managing your inventory and choosing right logistics partner are the most important steps to create the best logistic strategy for your business.

It seems obvious but if you don’t have the products that you’re selling to your customers in the warehouse, sooner or later you are going to disappoint them. Hence, whether you procure and manage your supply in-house or outsource it, you need to have this element under complete control.

The best way to manage an accurate inventory?

  • Tracking your goods: For small business owners, it is essential to master the art of supply and demand, which is not any easy thing.
  • Regularly reviewing your stock forecasts and committing enough time to calculate safety stocks.

An effective way to create the best logistics strategy is to always connect with all parts of the supply chain- such as suppliers, partners, and companies.

2. Choose Reliable Logistics Partners and Tools

The second step to creating the best logistics strategy is to choose consistent logistics partners & tools. Many startups or smaller businesses prefer to keep logistics as an in-house function because involving a third party agency or a vendor means additional cost for the business.

According to our Bada Business Professor, Mr. Harpreet Singh Malhotra – Managing Director, Tiger Logistics (India) Private Ltd, budding entrepreneurs or business owners should focus on their strengths which is the product and should outsource the logistics service at the initial stage of business.

Outsourcing the logistics service helps in the following ways:

  • Focus can be directed towards the core business and product
  • Taking advantage of the expertise of the logistics partner
  • Bringing economies of scale in the business
  • Cost-effective and timely solutions

How to choose the right logistics partner?

To choose the right logistics partner for your business, you should consider the following points:

  • Product Knowledge:
    Your logistics partner must have the essential knowledge about your product. 

For example: If you’re in the food grain business, then your logistics partner should be the one who has sufficient knowledge about this domain and can make sure that grains are delivered in time without any loss to the product.

  • Reliability of the partner company:
    Your logistics partner needs to be someone, you can completely rely upon. This can be evaluated on the basis of the following:

The capability of the company to handle your products

– Credibility in the market

– Ability to give the benefits of its vendors to you

– Timely delivery of the product

– Reasonable costing of delivery

– Experience in a similar product line or product mix

3. Offer a wide range of options to your customers

Last but not the least, to create the best logistics strategy you need to offer a wide variety of options to your customers.

Flexibility is an absolute must nowadays. Today the customers are me-centric and expect the business to provide the options that fit in with their lifestyle and needs. And when it comes to logistics & order fulfillment, this is very relevant and crucial.

Many customers discontinue and leave their shopping cart when choosing the delivery option. Why?

Because customer haven’t found the delivery option they wanted. Keep in mind, as a business you have to consider and offer both delivery/pickup options and the speed at which these functions take place

  • Many customers want a door to door shipping option while others feel that a pickup delivery option is better and works for them well.
  • To maintain an edge over speed, you can offer regular, express and even same day or next day delivery services.

This helps you to become the preferred brand for your customers and builds a good reputation in the market.

We hope these tips help you create the best logistics strategy that will not only be good for your business but for your customers as well, leading to a long-lasting relationship with them. An efficient logistics strategy creates loyal customers for your business and loyal customers can help your business grow.