Office with stylish yellow carpet

Women’s History Month 2022: Michelle Pippin’s Wowing Journey To Create Women Who WOW

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Women’s History Month is a celebration of female empowerment and the figures throughout history who have made strides in women’s rights and industry. While our earlier spotlights during this Women’s History Month featured strong, driven, and independent women-owned small businesses, today’s spotlight is a little different. Women Who WOW is not just a woman-owned small business; it is a small business for other woman-owned small businesses. Owned and operated by Michelle Pippin, Women who WOW is an online coaching and mentoring platform “for seriously driven women,” according to Pippin herself. Having built her business with the most grassroots strategy possible, Pippin’s story is more than a tale of female empowerment, but a learning tool (in more ways than one!) for the next generation of female small business owners.

Teaching to Learn

Michelle Pippin, Owner and Founder of Women Who WOW

Michelle Pippin turned a turn-of-the-century one-woman operation into the “wowing” Women Who WOW which is now operated in all 50 states and eight countries. While there are several online business training programs for aspiring business owners to choose from, Women Who WOW is distinctly different: “What makes WOW special is its focus on freedom and empowerment for women,” Pippin explains. “While we help these women make more money in their business, it’s really about empowering them to lead the lives they want to live. In the end, if you can’t financially support yourself and your goals, full empowerment isn’t possible. So, entrepreneurship is the vehicle, but empowerment is the destination.”

While knowing the basics of management and accounting are great tools, business owners kept from their own potential will have little use for even the most genius ideas. Pippin’s purpose is more than rational, it is essential for the modern business owner, as self-reliance and empowerment are the most versatile tools in the small business owner’s belt. Pippin’s methodology gets to the critical crux of the unspoken rule: don’t just run your business;  sustain yourself alongside your business; and there may be no one better fit than Pippin to explain the intricacies of both empowerment and a healthy working life.

$50 Seed to Priceless Idea

Yes, it’s true: Michelle Pippin created Women Who WOW while raising a family at home and with $50 of seed money. It is forthcoming, then, that Pippin has more than sufficient experience creating a small business under tough conditions. “Like anyone, I had to stare down the ‘devils’ of disappointment, defeat, and distraction.  I had to stay true to my business goals while also raising three kids, caring for my aging Grandfather, and being the wife I wanted to be.  It was hard, but never complicated.  Bottom line, I had to bet on myself and determine to live according to my own priorities rather than get caught in the busy-ness of the business world. In the end, this allowed me to take more focused and bolder steps in my business, creating financial success faster.”

Those first steps were admirably grassroots, as Pippin started seeking our clients for her business in 1999, long before digital marketing became prevalent. “I started this community by growing our members through print invites for 18 months, which is very different in the internet marketing space. I thought this step necessary to protect the culture of Women Who WOW, to keep our tribe high touch, high drive and deliberately low tech.”

In 1999, “working from home” could be seen as corporate code for “taking the day off,” but Pippin anticipated today’s change in the working world more than two decades earlier. “My desire was simple: to be at home full time with my babies. However, being married to a public school teacher demanded that I immediately replace my full-time income. So, I had to move fast.  After the first year of selling my services as an ‘at home secretary’ — and making $63K — I figured out that I wasn’t just ‘cobbling together an income,’ but running a real business.”

WOWing for the Future

In a new era of digital opportunity and reliance, Pippin’s two decades of experience running an online business made the pandemic shift straightforward but by no means easy. Now a veteran of digital marketing and initiatives, even pandemic staffing shortages didn’t sink Pippin: “I have curated my income streams to run lean,” Pippin explains. “I try not to take on projects or launches that depend too heavily on a full team and focus on selling deliverables that I can control.  It’s also important when marketing to acknowledge the hardships in the world, so you aren’t selling while being viewed as obtuse.”

Teaching by Example

Michelle Pippin’s business story is a lesson in itself: work begets success. Truly successful businesses are forged by the searing heat of sometimes uncomfortable hours and the weight of several hats balanced at once on very few heads. Who is better than Pippin, then, to teach business empowerment? Being that her business came to be in a field that barely existed and came to thrive when that field grew in around her. There is no greater empowerment than the validation of determined success. Voices like Pippin’s are irreplaceable in the forthcoming history of visionary women small business owners, and we are honored to spotlight not only her business, but her unique path to empowerment; both are proof that Women’s History Month ought to be twelve months long.

Term loan duration small business lending

What Should the Duration of Your Term Loan be?

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If you’re ready to apply for a term loan for your small business, you want the terms of your loan to be as unique as your business. That said, one of the most important factors you should look at when taking on a term loan is…how long should your loan last? In the world of small businesses, the general impression has been that term loans offered by both banks and alternative lenders are typically short-term, usually with a maximum duration of 24 months. 

That has changed in recent years, however, as more banks and alternative lenders, such as Kapitus, have begun offering a new option to small business borrowers – term loans extending up to 60 months. In some cases, long-term loans may offer benefits for established small businesses such as a lower fixed payment. 

What Factors Should You Consider?

There are several factors to consider when determining what the duration of your loan should be. Additionally, the factors you should consider for a 60-month loan may be different than the ones you would consider for a loan that is 24 months or shorter. 

Josh Jones Kapitus small business lending

Josh Jones, Kapitus’ Chief Revenue Officer, said the duration of your term loan should be a major factor when deciding to get financing.

“If you’re able to get something approved outside of two years, you have a different decision as a business owner,” said Josh Jones, Kapitus’ Chief Revenue Officer. He added that when a small business owner is considering taking a loan of 24 months or shorter, they should examine what they are using the borrowed assets for and when they expect a return on those assets. 

For example, if your business is borrowing money to develop and market a new product that will be introduced to consumers in two years, then maybe a 24-month loan makes more sense for you. 

“For something 24 months or shorter, you have to look at your needs, and kind of do some liability matching to what the use of the capital is and whenever it is a return is going to happen,” said Jones.  

If you’re considering a 24-month loan, you should take into account the total amount that you would be paying back the lender over two years, and the fact that new debt will most likely be available to you, if needed, once you’ve paid off the loan. 

“Typically, debt payment coverage based on the use of the money is a big thing,” said Jones. “Or the fact that I know I have regular needs for capital. If I know my business can support that regular payment, I may not want anything longer than 24 months because I always want an available credit limit.”

Factors to Consider When Going Long

When considering taking a loan longer than 24 months, there are several factors that you need to consider the the total cost of the loan. If you apply for a term loan that will be paid back over 60 months, for example, the total interest will be higher on that loan because the lender is taking on longevity risk – the risk that your business may not still be around in five years. After all, the average lifespan of a small business in the US is 8½ years, according to NAV.

Are you, the borrower, willing to pay more for a five-year loan than a 24-month loan? The answer to this depends on your ability to consistently make payments, and what you are using the borrowed assets for. 

“With total cost, the shorter you go, the more the total cost goes down,” said Jones. “It is possible that the annual percentage rate (APR) of a 24-month loan will be more, but business owners should be more concerned about the total cost of financing, not just the APR. I’m borrowing this money, what is my total payback? If I can reduce the cost, if my business can support the payment, or my opportunity supports the payment of my debt, then that’s going to be the winning factor.”

With a longer-duration loan, you need to carefully consider:

  1. The amount you will be paying each month. Generally, the total cost of a 60-month loan will be greater than that of a 24-month loan (of the same amount). Therefore, if you need to borrow assets, and your cash flow only allows you to pay a limited amount of debt service coverage every month, a long-term loan may make more sense since the fixed payments will be lower than a short-term loan. 
  2. Prepay Options. If you take out a 60-month loan and you want to pay it back in full in 24 months, you may have a few options in terms of the total cost of capital. Some lenders will charge you a prepay penalty by charging you the interest you would have paid had the loan gone to term. Other lenders may give you a prepay discount – they’ll discount the amount of interest you would have owed had the loan gone to term. In either case, you should carefully examine which option would be cheaper for you when you set the terms of the loan. 

What Should I Use a 60-Month Loan For, and How Do I Qualify?

You can use the proceeds of a 60-month loan on anything you choose for your business, and the amount

term loan duration small business financing

Carefully consider the total cost of capital with a long-term vs. a short-term loan

taken out for a long-term loan is typically higher than a short-term one. 

Generally speaking, proceeds for a long-term loan are usually spent on permanent assets for your business, which could include the purchase of property, office equipment, office furniture, computers and company vehicles. Perhaps you need a long-term loan to acquire a well-established business to complement your own.

Be aware that the requirements and underwriting process for obtaining a loan beyond 24 months are more stringent than a standard two-year loan, mainly because the lender is taking on that longevity risk. 

“Even if you have a great credit score, it can be very difficult for a business to get a 60-month loan unless they have [many] years in business,” said Jones. “That’s because the likelihood of a business [that’s well established] making it another five years is much higher than a business that’s shorter. It’s not meant to be insulting to anyone’s good business, it’s just the way the stats play out.”

Talk to Your Financing Specialist

The duration of your term loan will depend on several different factors; but, like with most loans, your ability to pay the loan back will usually be the key. Examine your balance sheet and cash flow history, and talk to the financing specialist about whether lower payments over a longer time horizon may be a better option for your business.

Two stand in greenhouse; they study a very small strawberry.

Guide to Business Certification

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It’s (almost) a certainty that you have seen window stickers, email signatures, or other public-facing material from businesses stating a certification of some kind. Business certification comes in several shapes and sizes and can be recognized at several different, exclusive levels. There are several reasons, as well, that you and your small business could be eligible for a certification, so it is essential that small business owners understand the benefits of certification as well as the steps to getting your business the recognition it deserves.

Who Certifies Businesses?

The SBA: The Small Business Administration grants certifications to businesses on a national level. The certain types of certifications given out by the SBA are specified in the “Types of Certifications” category of this article. Certifications by the SBA, however, are largely based on granting businesses the opportunity to work on certain government contracts.

Municipal and State Governments: All 50 states and several major U.S. cities offer their own level of certification to businesses. To find out if your city or municipality has certification programs that may fit your business, start by speaking with your local Chamber of Commerce or your local SCORE office.

Minority-Directed Organizations: Nationally recognized organizations geared to empower minorities like the National Minority Supplier Development Council and the Minority & Women-Owned Business Enterprise (MWBE) offer certifications for relevant businesses which largely assist those businesses in networking and acquiring private sector contracts.

Types of Certifications:

8(a) Small Business Certification

American small businesses who are at least 51% owned by U.S. citizens (or a Community Development Corporation, an agricultural cooperative, an Alaska Native corporation, a Native Hawaiian organization, or an Indian tribe) and who have a personal net worth less than $750,000 and adjusted gross income of $350,000 or less may be eligible for 8(a) Small Business Certification by the SBA. Business owners who fall under 8(a) certification are considered “socially or economically disadvantaged individuals” according to the SBA.

If a business earns this certification, they can then receive training from the SBA and partner associations “designed to strengthen their ability to compete effectively in the American economy.” Certified businesses may also seek out mentorship through the SBA Mentor-Protégé Program which connects business owners with experienced mentors at no charge. 8(a) businesses are also eligible to compete for specific government contracts set aside by the SBA. According to the SBA, “The government authorizes sole-source contracts to 8(a) participants for up to $7.5 million for acquisitions assigned manufacturing North American Industry Classification System (NAICS) codes and $4.5 million for all other acquisitions.” There are, however, exceptions to those limits for specifically approved contracts by the Department of Defense.

HUBZone Certification

American small businesses can seek out HUBZone (Historically Underutilized Business Zone) business certification from the SBA if they are at least 51% owned by U.S. citizens (or a Community Development Corporation, an agricultural cooperative, an Alaska Native corporation, a Native Hawaiian organization, or an Indian tribe) and have a principal office in an officially determined HUBZone. Lastly, at least 35% of your employees must also live in a HUBZone. To see if your business is within a HUBZone, refer to the SBA’s dynamic HUBZone map which is regularly updated.

HUBZone certified businesses are given preferential treatment to non-HUB businesses when seeking government contracts and are eligible to apply for SBA set-aside contracts. HUBZone businesses also get a 10% price evaluation preference when in full or open government contract competition.

B Corp certification

B Corp certification is a status given out by the B Corporation specifically for for-profit businesses which meet the company’s standards for social, environmental, and ethical performance. If your small business “generates less than $5M USD in annual revenue and employs less than 50 full-time employees,” you may then seek out Small Enterprise B Corp status. Being that B Corp certification is centrally concerned with your small business’s footprint and impact, you will need to supply the corporation with an incredibly full picture of your small business in the form of several assessments and reviews, all of which are explained on the corporation’s website.

Being certified as a B-Corp doesn’t come with the same contract preferences as the above SBA-related certifications but what B Corp certification omits in contract preferences, it makes up in multitudes in its outward social value. B Corps are certified forces for social responsibility which is likely to make your business preferable for both employment candidates and customers. Also, B Corp itself is a helpful mentor corporation as they give certified businesses access to their community data pool and can assist certified businesses in becoming more sustainable.

Women-Owned business certifications

The most robust and universally recognized organization which certifies Women-Owned Businesses is the Women’s Business Enterprise National Council (WBENC). The WBENC will consider businesses for Women-Owned status if at least 51% of the business is owned by a woman or women.  According to the WBENC: “This means one or more women must have unrestricted control of the business, a demonstrated management of day-to-day operations, and a proportionate investment of capital or expertise.”

Businesses with WBENC Women-Owned certification have access to the association’s supplier diversity and procurement executives at “hundreds” of U.S. corporations as well as WBENC contacts in government from federal to municipal levels. The WBENC also runs several events throughout the year for member businesses which are likely helpful marketing and networking opportunities. The WBENC also regularly awards and recognizes superb member businesses at  regional and national levels.

Minority-owned business certification

Minority-Owned Business certification is most often awarded and determined by the National Minority Supplier Development Council (NMSDC). In order to be considered a minority-owned business by the NMSDC, the council explains, “For the purposes of NMSDC’s program, a minority group member is an individual who is at least 25% Asian-Indian, Asian-Pacific, Black, Hispanic or Native American. Minority eligibility is established via a combination of document reviews, screenings, interviews and site visits. Ownership, in the case of a publicly owned business, means that at least 51% of the stock is owned by one or more minority group members.”

Member businesses are automatically added to the national minority supplier database which is a helpful means of visibility and preference for future contracts. The NMSDC also offers a variety of national and regional networking events for the purpose of expanding member business opportunities.

Veteran-owned Business Certification

All United States business owners who were on active duty with the Army, Air Force, Marines, Navy, or Coast Guard and are actively involved with managing their business are encouraged to apply for Veteran-Owned Business Certification. There are further certifications for disabled veterans (Service-Disabled Veteran-Owned Small Businesses [SDVOSB]) which will need additional verification from the Department of Veterans’ Affairs and Department of Defense. Depending on which types of contracts your small business is seeking preference for, there are multiple routes for securing veteran-owned status.

Via the SBA or VA: Small businesses who benefit the most from federal contracts should seek out veteran-owned status with either the SBA or VA directly. The SBA, however, only offers certification for disabled veterans (SDVOSB certification) while the VA offers both SDVOSB and VOSB certification.

National Veteran Business Development Council & National Veteran-Owned Business Association: Veteran-owned businesses seeking certification who deal largely in private contracts are more likely to benefit from veteran-owned status from organizations like the National Veteran Business Development Council (NVBDC) or the National Veteran-Owned Business Association (NaVOBA). Both organizations operate in similar circles and offer their own networking events as well as unique partner organization opportunities, so each business considering certification should investigate their needs versus each organization’s benefits, as neither is inherently superior for all businesses.

LGBT Business Certification

Business owners who identify as gay, lesbian, bisexual, or transgendered may seek out certification as an LGBT Business Enterprise from the National LGBT Chamber of Commerce (NGLCC). In addition to being majority-owned by an openly identifying LGBT community member, member businesses must operate independently from any non-LGBT business enterprise in order to be considered for certification. Businesses must also have a physical headquarters and a for-profit entity.

Like any other Chamber of Commerce level of certification in this guide, LGBT certification means that member businesses can take advantage of  the chamber’s resources, contacts, and community. The NGLCC runs monthly webinars from expert LGBT business owners and runs an independent mentorship program. The NGLCC also offers an exclusive annual scholarship to the Tuck School of Business Executive Education Program at Dartmouth University.

When is Certification Worth It?

Certifying your small business is often worth much more than the material benefits listed on chamber, council, and administration websites. Business owners who represent underprivileged or underrepresented groups have beaten the odds simply by existing. There is a pride in perseverance itself, but official certification in a cause or effort that you truly support can be massively gratifying and even open the door to genuine contacts through exclusive supplier lists and other networking events.

Where certification gets dicey, however, is when applications cost money upfront. All types of certifications that extend from the government are free but certification statuses from chambers of commerce and other private organizations can sometimes come with hefty application fees. In those cases, it is essential that businesses deeply consider what business certification means to them and if that official status is worth the price of admission.

Alesha Brown Womens History Month Kapitus

Women’s History Month 2022: Publishing Entrepreneur Proves a Woman’s Pen is Mightier Than Her Sword

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“Here’s to strong women – may we know them, may we be them, may we raise them.”

There are few industries in which the status and profiles of women need to be raised more than the publishing world. In the traditionally male-dominated industry, women have historically been paid less than men, even though women helped publish the first newspapers in the US. Studies have also shown that aspiring female authors also have not had the same opportunities in the publishing world as men. 

One woman in that industry is helping to change that. Alesha Brown, head of Alesha Brown LLC, which owns Fruition Publishing Concierge Services, a company that seeks to simplify the book publishing process – especially for new, female authors – is making strides to reshape the publishing business. 

‘Never Intended to be an Entrepreneur’

Alesha Brown Kapitus Women's History Month

Alesha Brown launched her own publishing company after being denied a well-deserved raise.

Brown launched Fruition in 2015 after being denied a raise at her old company, although she wasn’t intending to start her own business. But, she decided that this was the best way to pursue her dream of helping struggling authors publish their works.

“Believe it or not, I never wanted to be an entrepreneur or small business owner,” said Brown. “I launched into business after a salary adjustment denial resulted in me investing in my side hustle, which was birthed when I self-published my first book. The more I promoted my book, the more audiences sought advice on how to publish a book. 

“They wanted someone to give them information and walk alongside them in the process. The business grew so much in one year that I had to decide whether to resign from my government position or give up my growing business. The thought of quitting on myself seemed so egregious, especially for a company that was not invested in my growth and long-term success. The decision was easy to make, and I have not regretted it since, challenges and all.”

Navigating Scams, Legal Hurdles

Alesha Brown publishing Kapitus Women's History Monthh

Brown started Fruition Publishing to simplify the publishing process for aspiring authors.

One of the main reasons Brown launched Fruition is that she wanted to help aspiring authors avoid the many potential scams and legal pitfalls in the publishing world. There are many illegitimate companies out there that promise to publish books for large fees and never do, or companies that create contracts that give them most of the profits when a book does well.

“Fruition Publishing Concierge Services™, demystifies the book publishing process and shows clients how to profit and build income streams by monetizing their expertise,” said Brown.

“What is unique about this business is that I, as its founder & CEO, expose the legal pitfalls and scams prevalent in the industry. I do so boldly on the industry’s mainstream stages, associations, magazines, and journals to avoid the exploitation of women and underrepresented voices in the publishing industry.”

Overcoming Lack of Access, Funding

Kapitus Women's History Month Alesha Brown publishing

Fruition Publishing is thriving despite lack of access to capital early on.

Brown, who is African American, said a lack of funding and access to key decision makers at publishing companies is all too common in the publishing world, especially for women of color, and she aims to help change that. 

“As a double minority, I have had to overcome starting a business with no investors or large capital reserves in an industry where diversity, inclusion, and equity do not exist,” she said. “The publishing industry is one where minority leaders, writers, and authors are not revered and seldom have access to its key decision-makers and gatekeepers, which impacts their success and profitability. As important as continued education is, relationships with the industry’s gatekeepers have really made a difference for my business and the clients we represent, especially during the pandemic.”

Pandemic is Good for Business

The majority of small businesses continue to deal with a plethora of economic challenges, many of which have been brought upon by the COVID-19 pandemic, Brown says that the publishing industry is no different.  Yet, while the publishing world is feeling the crunch of supply chain shortages and inflation, more people are seeking to write and publish books as they work from home and have more time to reflect on their lives. 

“Actually, the pandemic led to an influx in business because people felt a sense of urgency in ending procrastination and making sure they fulfilled their dream of becoming a published author,” Brown said. 

“Others saw the potential profitability at a time when the world was at a standstill, and audiences were reading at all-time high rates. However, the publishing industry is dealing with ongoing supply chain shortages affecting printing and production, such as paper and ink shortages, labor shortages, delayed delivery times, etc. This is where leveraging technology and digital products have served us well. 

Don’t Forget to Check Out All of our Women’s History Month Profiles!

Beyond Sales: How to Measure and Improve Customer Lifetime Value

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Acquiring new customers is certainly one of the most important aspects of running a small business, but SMB owners also can’t forget that keeping existing customers coming back is just as crucial to the long-term survival of their businesses. This is the reason why customer lifetime value (CLV) – the total amount of money you can reasonably expect from repeat customers over the lifetime of their relationship with your business – is often closely monitored by successful small business owners. 

Maintaining a strong CLV number is important for a variety of reasons. First, it can increase your profit margins, since it generally costs less from a marketing and advertising standpoint to attract an existing customer than a new one, since, ideally, existing customers have already had a positive experience with your business. Second, strong CLV puts your business in a much better position to thrive in the future since it is a strong indicator of future sales. Third, a weak CLV number can tell you the areas of your marketing and customer experience strategies that need changing and improvements. 

What You Can Learn from CLV

CLV allows you to:

  • Recognize your best customers. CLV will tell you which customers most frequently spend money with you and which ones spend the most per transaction. Knowing the profile of your biggest spenders allows you to conduct marketing campaigns in a hyper-targeted way, focusing on those channels that you know will reach those who have the potential to spend the most.  But beyond that, it can help you retain existing customers.  Whether you’re in the accounting or retail businesses, these are the customers that you probably want to offer special discounts to; provide individual customer service to; and to whom you would showcase the products or services you may want to promote more heavily. 
  • Improve Forecasting. By forecasting what products and services repeat customers may want over a future time frame, you should be able to effectively manage inventory and allocate marketing and sales resources. 
  • Segment customers. Calculating CLV allows you to categorize your customers into groups based on which ones are likely to make a repeat purchase. This will allow you to effectively tailor your marketing strategy and increase lead conversion rates.
  • Figure out ways to keep customers coming back. Most importantly, CLV will allow you to customize your marketing to encourage customers to make repeat purchases from your business. Remember, repeat business is essential to your future growth.

Calculating CLV

The simplest way to measure CLV is to multiply the average purchase price (aka average value) by the

Customer Lifetime Value

Calculating customer lifetime value could very well be one of the most important exercises for your small business.

average number of times a customer makes a purchase (aka average customer lifespan). This formula should apply if you are using CLV to predict your future sales flow, even if your sales are seasonal and inconsistent.

If you don’t have much in the way of sales history data, however, this formula may be tricky because you’re going to have to estimate both average purchase price and average customer lifespan. Guessing average purchase price and average customer lifespan will likely result in a high margin of error. 

How do Everyday SMB Owners Calculate CLV?

While the equations may seem complicated, and small businesses sometimes seek the help of outside marketing firms to calculate CLV, many have created a system that allows them to determine this number in-house. . Kapitus spoke to everyday business owners to discover not just how they calculate CLV, but the ways they try to improve it. 

Zach Goldstein, founder of Public Rec, says keeping your website appealing is key to maintaining strong CLV.

Zach Goldstein, founder of athletic apparel line Public Rec, said the best way to improve CLV for an eCommerce business is to examine and improve the pages on your website in which potential customers are leaving. 

“We use the average order value our customers buy annually multiplied by their average lifetime value to determine the average CLV for our business,” said Goldstein. “There are multiple ways to improve CLV depending on where users drop off in your sales funnel.

“The best way to increase CLV is to optimize your customer retention. First and foremost, this means analyzing your sales funnel to see at what step or event in the browsing process your users tend to abandon the site. From there, you implement strategic changes to your website design or in reaching out to the customer via email to gain feedback on what works.”

Chris Gadek, vice president of growth at billboard company AdQuick, said creating strong customer retention starts with personalized customer service.

“CLV shows how loyal customers are to your product and your brand,” said Gadek. “Creating a sentimental value between customer, product, and business increases revenue and retention. As a metric, you can describe lifelong customers as those who continuously interact with your platforms or continually purchase products from your website at a consistent pace.”

Prioritize Customer Loyalty Programs

Jason Sherman, founder of TapRM, says loyalty programs and retargeting ads are key to customer retention.

Jason Sherman, founder of TapRM, an eCommerce platform for craft beers, said the key to improving CLV is to focus on customer retention marketing. 

“Your RPR [Repeat Purchase Rate] shows how often customers make repeat purchases,” said Sherman. “To calculate it, first find the number of customers who placed an order, let’s say, in December. For that same month, find the number of repeat customers. Then divide the repeat customers by the total customers…You can improve your RPR through customer retention strategies such as an optimized customer life cycle, loyalty programs, retargeting ads, and cart abandonment emails. This creates a better post-purchase experience that drives customer loyalty and increases repeat sales.”

Brandon Adcock, founder of Nugenix, says discounts, special offers, and quality outreach marketing go a long way to obtaining repeat business from customers.

Brandon Adcock, CEO of Nugenix, which manufactures and sells men’s dietary supplements, also said that offering discounts and retention programs are key to the survival of his company.

“We measure our customer lifetime value by looking at their average purchases, both amount and frequency, and projecting that at a similar rate into the future,” said Adcock. “But importantly, customers aren’t static, and neither are businesses. Prices and products change, and the world of e-commerce is growing more competitive by the day. We build CLV by fostering long-lasting relationships with our customers through discounts, special offers, and quality outreach marketing that creates a positive image for our brand.”

Focus on Customer Onboarding

Steven Walker, CEO of Spylix, emphasized that a company’s CLV will automatically be strong if customers have a good initial experience. 

“We use the simplest formula for calculating customer lifetime value: the average order total multiplied by the average number of purchases in a year, multiplied by the average retention time in years,” said Walker. “Based on current data, this estimates the average lifetime

 value of a client. With data from specific categories, you may utilize this data to better focus retention and promotional activities.

“Introducing new clients to your business, explaining what you do, why it matters, and why they should stay” are paramount, said Walker. “Long-term client relationships need trust. Buyers will return if they feel your organization gives the greatest deals on their desired items. It works because building real relationships with consumers keeps them coming back.”

Build Your Future

Whether you own a law or accounting firm, or a construction or plumbing company, repeat business is crucial to the survival of your company as it ensures that customers will keep coming back in the future. While there are several ways to calculate CLV, at least part of your marketing and sales focus should be on encouraging customers to return. 

cash surplus investing financial advisor

Should You Invest Your Business’ Surplus Cash? Absolutely

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If sales are booming and your small business is flush with cash, congratulations! While having a large surplus of cash is great for your small business, SMB owners also need to understand that the more surplus cash you have, the greater your chances are of losing money. 

How? Well, the rate of inflation reached a four-decade high of 7.9% in February, and the interest you’re collecting on your business savings account is almost certainly far less than that. Also, if you have any outstanding loans, the interest you’re paying on them is far greater than the interest from your savings account. You should also remember that we’re still going through “The Great Resignation,” so if you plan to increase your staff, current wage growth most likely is exceeding the interest that you’re getting from your business savings account.

Determine Your Timelines

If you’re in the fortunate position of having a large cash surplus for your business, you have plenty of options to invest that cash in a way that you won’t lose money. Before you consider your options, however, you should first take the time to determine what you want to use that excess cash for. The first thing you want to do is assess what you want to spend it on, and what your time horizons may be for spending that cash. 

Registered investment advisor

A registered investment advisor can assist and educate you on your investment decisions.

You may want to seek advice from a financial advisor or a broker-dealer on how to invest your extra money. Take note that some financial advisors will only deal with you if you have a certain amount to invest and are generally more expensive than brokers, so choose carefully. If you feel you’re a sophisticated investor, you can always use online trading services such as Ameritrade, E*Trade or Robinhood. 

Short-Term Spending and Investing

If you have short-term plans to spend your surplus cash over the next year or less, such as expanding your business with additional staff; leasing a larger workspace; purchasing additional non-perishable inventory before inflation rises even further; or replacing old equipment crucial to your business in the next 12 months, there are investment instruments that can give you a much higher yield than your business savings account. 

You can also forgo investing by using your surplus cash to pay off any outstanding loans you may have, as many lenders do offer a pre-pay discount if you choose to pay off several types of loans before their terms expire.

If you are willing to go the investment route, there are plenty of asset management firms that offer a wide array of short-term investment options. As a business owner, you want these options to give you returns that are greater than your business savings account and are highly liquid. Some of these options include:

  • A money market account. This is an account that you can open at most large banks or by going through a broker and purchasing shares in a money market mutual funds. It will provide a higher yield than a savings account because it invests your money in short-term treasury bonds or commercial paper – a form of short-term financing typically used by large corporations. These types of accounts are considered very low risk and can be liquidated at a moment’s notice. 
  • A short-term treasury market mutual fund. Most investment managers do offer mutual funds designed for short-term investors. These funds tend to be low risk and typically invest in a mix of investment-grade and short-duration treasury bonds. Keep in mind, however, that mutual fund fees can be expensive, so shop around.
  • A certificate of deposit (CD). With the federal funds overnight rate set to rise, you may consider a CD. This is considered a low-risk account in which you can park your money and get a monthly fixed, compounding interest rate over a predetermined period that can be six months, a year or longer.  Most banks offer these types of vehicles, but you should shop around for ones that offer the best rate.
  • An exchange-traded fund (ETF).  ETFs are often cheaper than mutual funds because they don’t invest directly in securities like stocks and bonds, but rather, index futures. Put simply, they are funds that will typically generate the passive returns of whatever financial index you choose. Common indices include the S&P 500 Index (stocks) and the Bloomberg US Aggregate Bond Index (bonds). If your risk/return tolerance is high, you can invest in the stock market. Keep in mind that the average annual compounded return for the S&P 500 since its inception in the early 20th century is 10.5%, but the short-term volatility is high. 

Long-Term Spending Plans

Are there long-term spending goals in your business plan, such as developing and offering a new product, or moving your headquarters to a larger space a few years down the road? The COVID-19 pandemic, which is now entering its third year, taught us that the economy can turn on a dime, so maybe you want to create an emergency cash reserve fund to keep your business afloat when the next recession hits. These are just a few examples of what you may have long-term spending plans for. 

If you have plans for your surplus cash that extend beyond a year, you can tolerate more risk, which means you have the potential to generate higher returns on your investments over the long haul. There are plenty of asset classes you can choose from that, despite having short-term volatility, have average annual returns that are much higher than anything you would see from a savings account or short-term bond investment. To put it simply, the longer your investment time horizon is, the greater your returns on capital can be. 

Your registered investment advisor (RIA) should educate you on the different asset classes and types of mutual funds that are best for long-term investing, as well as the basics such as risk management, modern portfolio theory, and portfolio optimization strategies. Depending on how much cash you have to invest, you may wish to invest in a basket of mutual funds for a diversified portfolio. Your RIA should also keep you informed on world events and how they may affect your portfolio.

Long-term Asset Classes

Some options you may consider for long-term investing include:

  1. An asset allocation mutual fund. If you want to invest in the long-term but don’t have the stomach for taking on excess investment risk, this may be the option for you. This type of mutual fund automatically allocates your assets among stocks, bonds and cash to optimize investment risk.
  2. Mutual funds that invest in equities (stocks). There are plenty of funds that invest in stocks. While these funds tend to be more expensive than low-risk bond funds – especially if they are actively managed – they tend to produce the highest returns over the long term. There are equity mutual funds that invest in everything from the S&P 500 Index to foreign stocks in emerging economies.
  3. Real Estate mutual funds. There are mutual funds that invest exclusively in various forms of real estate. Before you decide to invest, you should speak to your financial advisor and know that these types of mutual funds carry high management fees and high short-term volatility.
  4. Alternative investments. There are mutual funds that engage in exotic investment strategies, such as long/short, absolute return, and portable alpha strategies, and carry high management fees. These funds often seek to curb risk while delivering consistent returns. However, you need to make sure you get a solid understanding of these funds from your RIA before investing.

Don’t Lose Money!

Having surplus cash is a great thing for your small business, as it gives you many options for growing your business and surviving during a downturn. You must understand, however, that simply squirreling it away in your business savings account can cost you dearly. If you’re in such a fortunate position, speak with your accountant or an RIA to find out what your options are. 

 

How Kristin Wallace is Changing the World of Freight with Atlantic Freight LLC

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As we push into the midway of Women’s History Month, don’t expect the businesses we highlight (or the women we feature!) to be any less compelling. Continuing the second tenet of the mantra “Here’s to strong women – may we know them, may we be them, may we raise them,” let us highlight another business that small business owners can aspire to be like. It is our honor to highlight Kristin Wallace, the President, and Founder of Atlantic Freight LLC.

Heavy Lifting

Atlantic Freight LLC is a freight company in Boston, MA that exclusively hauls loads for Amazon. Moving those crates and boxes filled with Amazon goods, however, isn’t the only heavy lifting happening at this Back Bay freight company. President and Founder, Kristin Wallace, is both lifting the veil on male-dominated freight stigmas and uplifting opportunities for women everywhere through her hard work and dedication. Wallace is a business owner with several years’ experience in fields from logistics, finance, marketing, real estate, transportation, business development (among several other fields!).

Kristin Wallace, President and Founder of Atlantic Freight LLC

“I think women in Freight is pretty unique, even more so a woman-owned freight company,” Wallace explained. “I became a small business owner because I have always wanted to be my own boss. I enjoy the uniqueness that comes with each day when you own your own company. I also wanted my daughters to see that women can do anything!”

Pandemic Problems

Atlantic Freight LLC has been in operation since May 2021, meaning that the business kicked off during one of the high peaks of the COVID-19 pandemic. “I think there are the typical obstacles to starting a business that everyone faces, but I also started a business during a pandemic while working from home with two small kids…one who is severely immunocompromised. So, that definitely added a layer of complexity to the launch of this company.”

Wallace worked tirelessly to bring her company into working order and did so while balancing family life. “I regularly have to take her for doctors’ visits, infusions, labs, etc. so that can be a challenge. I also wanted to be extremely careful about bringing home anything, especially Covid, so I did most of my interviews remotely, which was not always ideal.”

Amazon, being one of the major fulfillment companies consumers relied on during lockdown, partnered with more regional freight companies across the planet in 2021; and Wallace’s company proved their mettle; Her company quickly became a major load hauler for Amazon. Despite the challenges brought on by the pandemic, Wallace diligently built out a fleet of trucks and drivers fit for the job of not only delivering loads but breaking stigmas as well. “I also think that there was an initial challenge to recruiting drivers to come and work for me as a new start-up in this industry that is typically male-dominated.”

A New Kind of Freight

The hard and cold stigmas that taint the greater freight and shipping industry don’t just alienate the women in the field; they also often disenfranchise the drivers and workers who work tirelessly to deliver payloads. The picture classically drawn of a “freight company” or a “freight driver” is often skewed a bit too far “macho” than what is true to reality. While we tend to think of those drivers and workers as rugged “Clint Eastwood-type” folks who don’t need breaks, Wallace acted doubly hard to dispel this stigma. “My drivers tell me that working with us is completely different from other freight companies, and that is a good thing! They tell us they feel like a person rather than a number…and that is the feeling I am going for. Whether it is putting cookies in the trucks for the holidays or a note to tell them to have a safe day, we try to make our company a place where our drivers want to come to work each day.”

The Road Ahead

Wallace’s new world of freight is urgent and quick; it doesn’t hurt having the largest fulfillment company in North America as your sole client. While the pandemic may be receding, internal Amazon reports  indicate commerce will expand over the next decade on the service. The only roadblock that could slow down Wallace and Atlantic Freight, then, is not seating their trucks with drivers fast enough. Even despite Wallace’s modern, personal approach to freight, her company has not been spared by the employment shortage felt across nearly every industry in North America. “The labor shortages have made recruiting drivers more difficult. We really have to make ourselves unique and stand out to attract talent.” This, however, hasn’t slowed down Wallace’s can-do attitude: “We have to work extra hard with recruiting and devote a lot of time and follow up to bringing on candidates, but it is worth it to build a great team.”

Be the Change, Be the Freight

Women’s History Month is both a time to recognize the women who have made history, while also using it as   a space for recognizing those women who are making history. Kristin Wallace and Atlantic Freight LLC are a touchstone of modern business perseverance, sensibility, and humanity. Wallace is a business owner we can all take inspiration from. As the world continues to connect and intertwine in more intricate ways, companies like Atlantic Freight and the leaders who create them –  like Wallace – should be remembered not only as those who won over a market space, but also as individuals who made that space better through innovations – both human and logistic.

What Does the Future Hold for the Grocery Industry?

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The survival of the nearly 22,000 independent grocers in the US will certainly depend on whether they can phase in certain hi-tech services to their businesses in the future, but for right now, research is showing that they can take their time, as online grocery delivery services being touted by giants Amazon and Walmart will not impact them as much as previously thought. 

Research shows that the majority of consumers are still willing to make the weekly trek to their local grocery stores to buy food for the week, and they still want to see and smell certain products – such as meat and produce – before they buy them, which they obviously cannot do online. 

This is all probably good news for independent grocery stores, many of which may not be able to afford to offer complicated online grocery shopping systems, but that doesn’t mean that online grocery shopping won’t catch on sooner or later, and independent stores need to follow suit.

Online Shopping Not a Huge Threat – Yet

online grocery shopping

The jury is still out on the popularity of online grocery delivery services.

Even since the start of the pandemic, consumer behavior when it comes to grocery shopping is largely unchanged – approximately 80% of consumers still prefer to buy at least some of their groceries at a physical store, according to research by PYMNTS.com. 

Of course, online grocery shopping isn’t new – it’s been around since 1989 when Chicago-based Peabod, owned by Netherlands-based Ahold Delhaize (which also owns the Stop N Shop and Food Lion), introduced the concept. Since then, Fresh Direct was introduced in 1999 and has grown to roughly $600 million in revenue in 2020. 

The fact is that even during the pandemic when consumers had to shelter in place, the percentage of consumers who switched to purchasing groceries entirely online since the start of the pandemic grew to just 17.2% from roughly 14%. 

Pantry’s Failure – What it Means

Another big indication that online grocery shopping is not as big of a deal as many may think right now is the discontinuance of Amazon Pantry in March 2020. Originally launched as Prime Pantry in 2014, it allowed Amazon Prime and non-Prime members to purchase individually packaged, non-perishable household goods into multi-boxed items to compete with bulk supermarkets such as CostCo or Sam’s Club. 

Many have argued that Pantry’s failure was due to Amazon itself because, since 2014, it launched grocery delivery service Amazon Fresh and same-day grocery delivery service Prime Now. 

Still, others have argued that Pantry’s failure was due to the fact that many consumers still prefer to shop at brick-and-mortar grocery stores, especially ones that offer bulk discounts on items such as cleaning and hygiene products.

Specialty Shopping on the Rise

Online grocery ordering, however, has never really penetrated 20% of the market. Nearly 64% of

Pre-prepared meals will be an integral part of the future of the grocery industry.

shoppers do buy some groceries online according to PYMNTS.com, but it is worth noting that many of these online purchases are often made for specialty foods. Indeed, the popularity of sites such as gourmetfoodstore.com and nuts.com that offer specialty, hard-to-find food items have grown in popularity over the past few years. 

Also, online services that deliver daily and weekly supplies of healthy,  pre-prepared meals such as Blueapron.com and Freshly.com rose in popularity, especially during the pandemic, and larger grocery chains such as Wegman’s and Krogers began offering pre-prepared meals in their aisles, as well as fresh sushi and soups to go. 

Total revenue for online meal delivery services worldwide grew to $13.1 billion in 2021 from $10.3 billion in 2019, and is expected to reach $20 billion by 2026, according to data from Statista.

If independent grocers want to keep up, they should also be offering prepared meals for the convenience of consumers, who growingly want to spend less time shopping and cooking. They should also become part of the supply chain that large chains are not part of by offering specialty foods – especially ethnic foods that might appeal to their local communities that aren’t offered by Walmart or Amazon.

How Big will Instacart’s Influence be? 

The Grocery industry is keeping a close eye on the success of Instacart’s services.

One of the companies that many analysts are watching closely right now is Instacart, which introduced the novel idea when it launched in 2015 to partner with major retailers such as Kroger, Albertsons, CVS and ALDI and act as a third-party grocery delivery system to local communities. Between 2019 and 2020 – the first year of the pandemic – the company’s revenues tripled to $1.5 billion. 

Instacart makes it easier for large retail grocery store chains to offer grocery delivery without having to invest the onerous resources in setting up that service themselves, and offering consumers the convenience of getting food delivered right to their homes.

While Instacart has had some success, the company also has gained plenty of detractors. News stations from the West Coast to the East Coast have run stories on the exorbitant markups in prices that the company slaps on to the groceries it delivers. These price increases are in addition to the company’s annual membership, service and delivery fees it charges. Only Time will tell if enough consumers are willing to pay Instacart’s prices before we see whether the service has an impact on the grocery industry. 

Other Changes

It is possible for independent grocery retailers to compete with the likes of Amazon and Walmart. Some changes they might consider are:

    • Offering lower prices. Amazon and its subsidiary, Wholefoods, are among the most expensive grocery stores in America. Consider lowering your prices to beat them.
    • Taking advantage of new markets. The US Dept. of Agriculture estimates that 23.5 million people live in “food deserts” – areas in which, on average, people live 10 miles or more away from a grocery store. This means that there are plenty of untapped grocery markets out there. 
    • Offering contactless payment options. Groceries represent the largest segment of the US retail market, and currently, contactless payment methods are becoming more in demand, especially since we are still in the midst of the COVID-19 pandemic.
    • Investing in new technology. Even if you can’t afford a service such as Instacart or to build an online grocery ordering and delivery service, it is still feasible and cost-effective for your store to offer pre-ordered grocery pick-up services. While this may represent a significant investment on your part, it could mean enabling the survival of your business. 
    • Paying workers more. The current minimum wage is $7.25 per hour, and that’s probably not going to last much longer given the “Great Resignation” workers movement and the fact that many states are already raising the minimum wage. 

Take Your Time

While independent grocers do need to prepare for the future by investing in new technologies to match new consumer behaviors, they don’t need to make all of the changes right away. 

Online grocery ordering is probably the wave of the future, but remember that it’s growth has been slow, even in the face of the pandemic. Your best bet is to invest in the future at your own pace and in a cost-effective way.

Two hands handling a credit card in front of a portable computer.

Finding the Right Business Credit Card with No Annual Fee

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Having reliable business credit is a valuable tool for day-to-day operations. As needs pop up at your business, having a business credit card on-hand can make a tough situation easier to deal with. Business credit cards, however, come in many shapes and sizes. And some of those cards on the larger side may have benefits or perks not suited to the way you do business. In addition, these cards often have an annual fee, making your business credit card yet another expense. However, if your small business is looking for a business credit card without a ton of extra bells and whistles, there are several practical card options that have no annual fee. Because no two small businesses have the same credit card needs, this list is in no order of preference; only you, the business owner, will be able to determine the card best suited to you.

 The Blue Business® Plus Card from American Express

It’s not often American Express finds itself on a list of “no annual fee” offerings, but in recent years American Express has expanded beyond their premium Gold and Platinum cards to offer several competitive basic credit cards. The Blue Business Plus Card from American Express has both no annual fee and 0% APR for the first year. After the first year, American Express will determine cardholders’ APR based on their credit and several other relevant factors. This card, for having no annual fee, has an incredibly lucrative points deal too: up to $50,000 annually, the Blue Business Plus Card doles out double points on nearly all purchases and potentially more points for travel booked through the American Express portal.

Like their premium card offerings, American Express gives Blue Business Plus cardholders a unique kind of buying power. According to AmEx, “There are no over-limit fees, no enrollment steps to take and you can continue to earn Membership Rewards® points or cash back on purchases above your credit limit.” The one catch is that balances over your existing spending power must be paid along with your monthly minimum.

Bank of America® Business Advantage Customized Cash Rewards Mastercard®

If you’re more interested in cash back than points, you may want to look at offerings from players like Bank of America. The Business Advantage Customized Cash Rewards Mastercard by Bank of America offers a great opening bonus: cardholders can get a $300 statement credit after spending at least $3,000 in the first 90 days after opening their account. In the long term, as well, the Business Advantage card offers 3% cash back in the transaction category of your choice, 2% back on dining, and 1% back on all other purchases. Those 3% and 2% cash back deals, however, only extend to the first $50,000 in relevant purchases each calendar year. All of this, of course, with no annual fee and a  0% intro APR for the first year. APR after the first year will be determined based on cardholder credit and other relevant factors.

If you already have a Bank of America business checking account, BofA explains that “You can earn up to 75% more cash back on every purchase, if you have a business checking account with Bank of America and qualify for our highest Preferred Rewards for Business tier.” In essence, you can take advantage of both cash back deals at once, meaning those cash back numbers become 5.25%, 3.5%, and 1.75%.

Chase Ink Business Unlimited® Credit Card

Chase’s Ink cards get good press in the business world for good reason: these sensible cards have just about every benefit you could look for in a business card and are generally a safe, straightforward solution for businesses in need of a credit card that can handle daily expenses. The Ink Business Unlimited® card is a reasonably competitive offering in the “no annual fee” credit card space with more than sufficient perks: cardholders have unlimited 1.5% cash back on every business purchase as well as a 0% intro APR for the first year; APR afterward will be determined by (you guessed it!) cardholder credit and other relevant factors. Unlike Bank of America, Chase credit card rewards go through points like American Express; also, like American Express, Chase points can be redeemed for a multitude of business uses like straight cash back or travel expenses.

As of this article’s publishing, the Ink Business Unlimited card is offering $750 cash back for cardholders who spend $7,500 on purchases in the first three months after opening their account.

Capital One® Spark® Classic for Business

Anyone with a nose for business credit cards likely expected one of Capital One’s Spark® cards to make an appearance on this list. Capital One’s Spark® Classic for Business, unlike the other cards on this list, says upfront that business owners with “fair” credit are the most likely to be considered for the Spark® Classic. If you are concerned about applying for a higher-end card, this may be the card to consider: the Spark® Classic has unlimited 1% cash back, 26.99% APR, along with some more interesting perks: this card’s monthly minimum payment, according to Capital One, “…will be the greater of $15 or 1% of your balance plus new interest, late payment fees, and any past due amount.” This means that business owners looking to carry a balance may find the Spark® Classic to be a lucrative deal.

PNC Cash Rewards® Visa Signature® Business Credit Card

Nearly every “no annual fee” credit card tries to grab business owners’ attention with cash back and points promises, so don’t be surprised that PNC Bank is playing the same game. It’s the little differences that count, however, when choosing a “no annual fee” business credit card, so let’s take a look: the PNC Cash Rewards® Visa Signature® Business Credit Card offers unlimited 1.50% cash back on what they call “net purchases” which, according to PNC, means “The term ‘net purchases’ does not mean all transactions you may make using your credit card. Some limited transactions are excluded.” This card also has a 0% intro APR for the first nine billing cycles and then can range from 10.99% to 19.99% APR (based on the business owner’s credit and other relevant factors) as of the publishing of this article. PNC also offers a $200 cash back bonus for cardholders who make at least $3,000 worth of “net purchases” during their first three billing cycles.

Know Your Needs, Find Your Card

This market of credit cards is often a place for decimals and minor percentage differences; the less you pay in as a cardholder, the less you can expect to get out of your card. Small business owners, however, don’t have to feel like they’re settling when opting for “no annual fee” cards on the market today – having a line of credit with no annual fee can be a fantastic resource for both maintaining a higher credit limit overall and building your credit in general. Consider making a wish list of every process and action you would like your business credit card to complete. Then, make a list of deal breakers like certain APR or cash back percentages. Once you have everything written down, then get to business choosing the right cards for your needs. If any of the above cards speaks to your business needs, consider speaking directly with the bank or financial institution that offers the card, as they can likely help you to further determine if their card is the right choice for you.

Women's History Month Yum Health Ice Cream

NYC “Mompreneur” Combines Real Life Experience With Business Acumen to Create Sweet Experience

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“Here’s to strong women – may we know them, may we be them, may we raise them.”

As Women’s History Month 2022 continues, it’s worth noting that there’s a distinct difference between a business that happens to be owned by a woman and a woman-owned business. Being a woman-owned business means that the owner has followed her dreams, passions, and experiences as a woman to thrive in a male-dominated world. Few business owners embody that spirit more than Nicole Frankel. 

Nicole is a mother in New York City, and, like most parents, struggled to get her four-year-old daughter to eat her fruits and vegetables. Like most kids, her daughter would shove aside healthy foods when she saw them on her plate, and Frankel began to worry that her daughter wasn’t getting the vitamins and nutrients that she needed. That’s when Frankel decided to combine her maternal instincts and business acumen that she learned from working at several startups in the past. 

Frankel would begin sneaking fruits and vegetables into the family’s homemade ice cream, and after two years of successfully getting her daughter to eat her fruits and veggies this way, Frankel decided to attend the Hudson Kitchen’s Food Business Bootcamp. Afterwards, Frankel launched Yum Actually, LLC, which specializes in crafting ice cream with nutritional foods as their main ingredients – Yummy Mango, Caramel Sweet Potato, Creamy Honey Banana, and Butternut Squash Butterscotch. The brand is now sold in 18 different food stores in Manhattan. 

Daughter Knows Best

Nicole Frankel began producing healthy ice cream for her daughter, and turned it into a thriving small business.

Frankel said that it was her daughter who came up with the name and the idea for Yum Actually when she first sampled ice cream with sweet potatoes in it. 

“I came up with the business idea about 3 years ago when I struggled to get my young daughter to eat sufficient fruits and vegetables,” said Frankel. “I resorted to turning them into something I knew she wouldn’t refuse, and that would be ice cream, of course! When she took her first bite, she yelled ‘it’s yum, actually!’ And the business name and concept were subsequently developed. Each snack cup of our ice cream contains a full serving of fruits & veggies and is loaded with nutrients. We launched the ice cream to market in early 2020 and are now sold in the majority of grocery stores in New York City. 

“Yum Actually makes a one-of-a-kind healthy ice cream for kids. In the crowded ice cream category, there are still very few healthy ice creams for kids, and we have changed that.” 

Success Despite Bad Timing

Frankel officially became a “mom-preneur” in 2019, the challenges were numerous, as the launch occurred right before the COVID-19 pandemic hit. Shortly after coming up with the idea for the business, Frankel was working part-time, but had no experience in the foodservice industry – most of her experience was in data analytics for financial investment firms. She worked hard at researching the food business and ice cream food science (yes, there is such a field), as well as carefully crafting a business plan and obtaining a license and trademark for her business. 

“There were too many challenges to mention them all!” she said. “But I’ll name a few: we launched right ahead of the Covid19 pandemic and therefore had to stop all in-store demos, deliveries, and meetings. I had to meet with grocery store managers over zoom, which was a sight to behold. We did however manage to get into 40 retailers in 2020. We’ve had significant manufacturing issues, which have included lost ingredients, packaging typos, broken equipment, and double-booked production runs as well.”

Like most small businesses, Frankel has had struggles pertaining to the pandemic, but has found success, nonetheless. “We have had to book our production runs well in advance of when we had to previously, and we have had to raise our prices, unfortunately,” she said. “Everyone has. Our suppliers have raised our wholesale prices by about 30% and we’ve in effect had to raise ours by about 8%.”

Overall, Frankel is happy with her decision to go out on her own. “Ice cream is so much more fun than financial technology,” she said.

Combining Creativity and Drive

Frankel said she started the business not only because she wanted to introduce a way to get children to eat healthier, but also to explore her creative side. 

“I’ve always been very independent as well as creative. And I believe that these are critical traits to have to launch a business. My background prior to founding Yum Actually included working at various tech startups and I think that experience helped thicken my skin and helped prepare me for starting my own.” 

Frankel advises aspiring small business owners to dive head first into launching their business, and not to get bogged down in honing their products or services. 

“Most entrepreneurs spend all their time trying to perfect their product, and what ends up happening is that they get so bogged down in those details that they just never launch,” she said. “I say, launch it! Even if it’s not perfect, get into the deep end. Start getting feedback from buyers and consumers, because, ultimately, that’s what matters. Your product will evolve once you get that feedback.”

Don’t forget to check out all of our Women’s History Month spotlights this month!

How Jill De Forest Found Success and Founded De Forest Search

TokStrategies Founder Overcomes Female StereoTypes to Help Small Businesses Reach Out on TikTok 

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