Auto mechanic working on car engine in mechanics garage. Repair service. authentic close-up shot

SMB Owners Share Solutions on Getting Around ‘Right to Repair’ Issue

/in , /by

Nearly every small business, be it a manufacturer, medical office, restaurant, or dry cleaner, has run into the nagging ‘right to repair’ issue. While the issue has been brought to light recently by McDonald’s finicky soft-serve ice cream machines, for small businesses, the right to repair issue could threaten their very survival. 

The scenario is very simple: a machine that is vital to your small business’ operations breaks down, and if your state does not have a right to repair law, you have no choice but to contact the manufacturer of the machine – or a repair company authorized by the manufacturer – to repair it. This process can take a significant amount of time and cost thousands of dollars, as the manufacturer essentially has the monopoly on repair services and can charge whatever it wants.

SMBs Lose Time and Money 

Business owners say that having the right to repair their own machines through whatever local repair shop they choose would reduce machine downtime, increase the lifecycles of their machines, and potentially save them money on repair costs. It also costs consumers money, especially with cell phones, as many consumers would rather replace their cell phones or other electronic devices than go through the hassle and expense of contacting the manufacturer to fix them.

Manufacturers, however, claim that the right to repair would divulge proprietary trade secrets and could, in some situations, even be dangerous -for example – if a doctor’s office tries to repair a piece of medical equipment on its own and does not do it correctly. 

Either way, small businesses, such as manufacturers that rely on complex CNC machines or farmers that use John Deere tractors are caught in the middle of this issue, and it is costing them time and money. The US Public Interest Research Group (PIRG) estimates that Americans throw away 416,000 cell phones each year because most states do not have right to repair laws in place, and electronics makers such as Apple force customers to come directly to them for repairs. 

So if your state does not have a right to repair law in place, what do you do when your crucial machine breaks down? Kapitus spoke to everyday small business owners to find out. 

Get to Know Your Machine’s Warranty

In some cases, your machine’s warranty will cover the cost to repair, or parts needed to repair the machine yourself, said Ryan Fyfe, COO at Workpuls, Inc. 

“As with many pieces of legislation, the Right to Repair Act is a set of guidelines intended to keep electronics manufacturers accountable for their products,” he said. “The bill states that all companies must make their devices easily repairable and provide parts or tools necessary to do so. Keep in mind that you may not be able to get a refund on your device if it can’t be fixed…More often than not, the warranty will cover damaged components even after you’ve been using it for some time or attempting DIY fixes yourself. In addition, see what type of warranty your device has from its manufacturer before making any repairs, so you don’t void the protection policy.”

Get Comfortable Negotiating

Kyle MacDonald, president of GPS fleet tracking systems provider Force by Mojio emphasized that manufacturers generally want to keep you as a customer and therefore are often willing to negotiate repair prices.

“I am personally a supporter of ongoing ‘Right to Repair” campaigns since small businesses like mine would benefit from being able to seek lower-priced repairs by independent entities rather than going to the manufacturer,’ said MacDonald. “That said, we negotiate with the manufacturer when there is no other option for repairs. A lot of people think repairs aren’t negotiable, but we have had some success in talking manufacturers down to a lower price in the past. We also keep all warranty information on hand in case we can evoke the language used there to seek a free or low-cost replacement.”

Have Backups 

James Green, owner of Build a Head, added that his company works with manufacturers to make sure machines get repaired quickly. 

“We have made sure that we have at least two (usually more) of every essential machine so that production doesn’t come to a complete halt if one machine breaks or has an issue,” said Green. “Our management staff has also made it a priority to build personal connections with our manufacturers so that we can hopefully get repairs done more quickly. We haven’t had too many issues, but whenever we do, we try to personally reach out to our connections to reduce the time it takes to fix the problem.”

Be Your Own Repair Person 

Most small business owners that Kapitus spoke with said the real solution is to learn how to repair machines themselves. Of course, this solution will take training and hours spent watching instructional videos on Youtube, but it could be well worth it. 

Alex Wan, co-founder of small business Vinpit, said learning how to fix his own machines has become an invaluable skill. “I experience frequent breakdowns of my machines, and if I were to pay someone every time something needs fixing, then I’d have spent millions by now,” said Wan. “In short, I usually do a lot of the fixing on my own unless they’re complex and need an expert to get things done. Even when I hire someone to do repairs for me, I usually ask them to take me through the steps because I know I’d need that skill in future. In my honest opinion, small business owners ought to have basic repair skills especially related to their line of work since they could save them boatloads of cash.”

Jose Mier, founder of Heliotherapy Research Institute, said that becoming his own repairman has also saved his company a lot of money. “When I started out with my business and moved to an office, I kept running into problems with the air conditioning unit,” he said. “I had to constantly call AC repairmen, and the costs were piling up. Then, I decided to learn to fix the ACs myself. I watched many YouTube tutorial videos and took some help from professionals…Now, when I run into problems, such as electric control failures and leaks, I’m able to fix them myself. In the past few months since I learned this skill, I’ve been able to save myself a lot of hassle and money.”

Push for Legislation 

If your state does not have a right to repair law, you may consider writing to your local politician to push for one. Right to repair laws in states that have them typically require manufacturers to provide repair information on their machines to all customers, including manuals, and offer parts that can be used to repair their machines. 

“Repairing your own machinery is actually a great idea, but often one might not be able to do that despite having the knowledge because some companies do not provide the information or the parts one might need,” said David Attard, a web designer at CollectiveRay.com. This act will help small businesses save time and money.”

You can check to see if your state does have a right to repair law. If not, you can contact your local politician and join repair.org, an industry trade group that is advocating for a right to repair law on a federal level. 

Fostering the Customer Experience Without Breaking the Bank

Best Low Cost Methods for Creating a Stellar Customer Experience

/in , /by

Before a customer makes even one purchase from you, their customer experience has already started. The customer experience is the culmination of every moment a customer spends with your business until they are no longer your customer. A good customer experience creates an emotional bond between your business and that customer, keeping them coming back again and again. Cultivating a stellar customer experience takes time and care but does not have to break the bank. Many strategies that strengthen the customer experience are cost-free and those with a price tag have the potential to produce great ROI through satisfied return customers and increasing the life-time value of a customer.  

Don’t Confuse Customer Experience with Customer Service

All of the most basic interactions your business and staff have with a customer account for customer service. Customer service is the most baseline expectation for customer interaction that businesses must meet to avoid bad online reviews and word of mouth. Answering the phone, making eye contact, saying ‘thank you,’ and listening to customer requests are all examples of customer service; all good things, but in no way memorable. Customer experience, on the other hand,  accounts for all of the unique, personal touches your business can make to emotionally connect with your client base. If done correctly, your customer experience should both raise your reviews from average to great as well as increase the number of sales you make through word of mouth and advocacy marketing.

The customer experience is what people remember about your business. Think about the small businesses that have made an impression on you. All of those elements that may have impressed you or made you laugh are a part of your own customer experience; it should be your business’s goal to get those same emotions from your customers.

Building a Brand

The first step to strengthening your customer experience is making sure you have a strong brand. While your small business may not be able to match the variety of Amazon or the low prices of Wal-Mart, small businesses have every opportunity to make their own brand, or business personality, compelling, targeted, and identifiable. Building a compelling brand for your business often begins with keeping all aspects of your brand like colors, tone, font consistent. If you don’t know what aspects work best for your business, do some light research to find out the median age and interests of your customers. Having a business with a distinct personality is the first step to making customers feel like their interactions with your company feel special.

Focusing your businesses’ brand to be more appealing to your customers is the best way to make those customers feel even better about visiting your business. Keep in mind these key pieces of a business’s brand when assessing your own.

Brand History and Story: Customers will feel even more connected to your business if they know how you started out. Small businesses with grassroots or individual histories should actively tell those stories on their website and social media pages. Businesses with start-up stories will likely resonate even more with customers, strengthening their customer experience.

Brand Personality: Establishing a brand personality means giving traits to your business that customers can then associate with. The first step to finding or refining your brand personality is choosing some adjectives that you think define your business. Get your staff into the conversation as well and try to get a list of words like “laidback, friendly, sophisticated, professional,” or anything that fits your business. A brand personality is essential for cultivating the customer experience, as customers more easily establish an emotional bond with a business that has perceived human traits.

Brand Values: Being upfront about what your business stands for is increasingly important to the customer experience. Bind your brand to memorable and compelling values like diversity, accessibility, or whatever values you think apply to your business. Then, draft a concise mission statement for your business that encompasses those values. Make sure your customers can easily access your mission statement from your website, social media and especially in your actual place of business.

Handwriting Goes a Long Way

This tip may seem basic, but handwriting is often overlooked for the sake of digital convenience. How often does your staff use pen and paper when communicating with customers? Think back to any time you’ve received a thank you card with genuine handwriting and how that made you feel. Clever use of handwritten notes reminds customers that your business is run by people and not robots and algorithms. Even further, use writing by hand as an opportunity to further your brand personality. Here are a few places your staff can implement handwriting to go the distance and make a personal connection with your customers.

Receipts: When appropriate, encourage staff to add a personal touch to customer receipts. Even a smiley-face or “thanks” is a quick way into a customer’s memory.

Special Notices: Even the most mundane notices like restroom closures or your business’ mask guidelines are ripe for handwriting as well as brand personality. Instead of simply writing “restroom closed,” consider your brand personality and make a sign another way to display your business’s unique traits.

Marketing Materials: Marketing doesn’t have to mean expensive postal and email campaigns. Marketing to cultivate the customer experience can be as simple as making changes inside and out of your store. If your storefront is along a street or busy walkway, consider getting a chalk board and writing something clever about your business beyond your hours. Once again, if your business is on a walkway, consider getting a water bowl for pets during the warmer months. Write a witty, cute note above the bowl inviting pets to take a drink. While the pet partakes, the owner is then much more likely to take a second look at your store.

Get Your Staff Involved

Direct interactions with staff are the basis of making customer experiences memorable. If you run a business with outward facing staff, be certain that your training encourages staff to interact with customers when appropriate. If you have in-house customer service, be certain they are trained to be both effective and infectiously friendly. For businesses who sell products from a brick-and-mortar location, round up your staff and either cultivate a ‘Staffs’ Picks’ collection of products or encourage your staff to select their favorite products and write up endorsements; double points if those endorsements are hand-written!

When getting your staff involved, be sure they are just as aware of your company’s brand and personality as you are. When your business’s brand is strong enough, you can even use your brand to attract staff that already represent your preferred tone and outward appearance.

Dynamic and meaningful staff interactions account for the most important piece of a customer experience. If customers are meant to resonate with your business’s brand and perceived traits, those traits ought to come through strongest via your employees who embody those same traits.

Follow-up After Visits

Following-up with your clients is one of the most certain ways to both improve their customer experience as well as increase the chances they will return to your business. There are several ways a business can follow-up with clients eg: email, SMS, letters, social media; it is essential your business finds out which medium resonates most with your customer base.

Follow-ups with clients absolutely must be timely. Be certain that any kind of follow up message is sent either the same day the customer interacted with your store, or as soon as possible. By sending a follow-up message close to the client’s visit, it’s clear to the customer that they are a priority to you, the business.

In order for your follow-up messages to avoid a quick send to the digital trash bin, think of creative ways to add value to your correspondence. Some examples are to give avenues for direct feedback and places for customers to give suggestions. If a customer fills out a feedback or suggestion form, that is another great place for a personalized follow-up! Be receptive and respectful if customers have meaningful complaints or thought-out criticism in their responses, as addressing those complaints thoughtfully can massively rebound a poor customer experience.

Social Media, Blogs, and Keeping Customers Engaged

Customers who are already wowed by your company and want to keep up with your brand even further will often use social media and your company website to keep in touch with your business until their next visit. Make sure that your web presence is sharp and up to date with content that reflects your established brand. Use your social media channels to advertise events in your store or to highlight new products in fun and charming ways. Your goal with social media outreach is to stay in the conversation; whatever that conversation is will be up to your target audience and existing customers.

The most sure-fire way to positively influence the customer experience on social media is to actively engage with customers. When people comment on your posts or “@” your business, it is imperative that your official account responds and engages with those posts in a timely manner. Keep a close eye on posts from people who tag your business after visiting; just a simple ‘thanks for stopping by’ can make a huge impact on that customer’s experience.

A great way to make social media part of the customer experience is responding to comments or posts that mention your business. Even engaging customers on social media is part of the customer experience. Get creative! If you have some regular customers who are big fans of your business, maybe feature them on your social media page along with a quote from that customer. Make sure to always get clear consent from customers before taking their picture or uploading pictures of them to the Internet.

An new strategy for keeping social media costs low is to work with interns. Large companies searching for social media managers often ask that applicants have several years’ experience to even apply. By making your company an entry-level opportunity, you can both grow your brand and business personality while giving young professionals the experience they need to pursue social media management as a career.

Final Considerations on Brand and Customer Experience

The basis of a memorable customer experience is one that breaks the mold of mundane daily tasks. Your aim should be to genuinely surprise customers with your business’s humanity and attention to detail. Good staff are an undeniable necessity when building a memorable customer experience; be certain they are as aware of this as you are. Find ways to both engage your customers as well as your outward-facing staff and those stellar experiences emblematic of small businesses will often happen naturally.

The Key Details of the Working Capital Cycle

What is a Working Capital Cycle

/in , /by

In the sometimes-lengthy process of turning a product into capital, all businesses are subject to what is called the “working capital cycle” (WCC). The working capital cycle is the amount of time it takes for a business to pay off their liabilities, such as their suppliers, and then begin collecting all cash they receive from sales as profit within one operating cycle. A well-managed working capital cycle often reflects a well-managed business. Businesses with working capital cycles with too many operational stopgaps can lead to low liquidity and a less stable production line. Effectively managing your company’s working capital cycle can give massive insight into your own operations and can better inform your financial decision-making.

Elements of a Working Capital Cycle

A working capital cycle can be separated into three categories, often called Accounts Payable Days, Inventory Days, and Accounts Receivable Days:

Accounts Payable Days: A business purchases raw materials for manufacturing and has a certain number of days to pay suppliers. The number of days in which you must pay your suppliers are your “Accounts Payable Days.”

Inventory Days: A business sells that inventory made from those raw materials to customers over a certain number of days. However many days it takes to sell your inventory are your “Inventory Days.”

Accounts Receivable Days: A business receives payment from customers over a certain number of days via invoice or credit card. The number of days you must wait for invoices and credit charges to become capital are your “Accounts Receivable Days.”

The basis of a good working capital cycle is making sure accounts receivable and inventory days are few enough so you can still pay suppliers on time. A working capital cycle can also be written as the formula:

Inventory Days + Receivable Days – Payable Days = Working Capital Cycle

Positive Working Capital Cycle

In most working capital cycles there are more accounts payable days — the days where payments from clients come in — than inventory and receivable days. This can be due to invoices or credit card processing windows that can take up to several weeks to become capital. Working capital cycles where payable days outnumber the sum of inventory days and receivable days are called positive working capital cycles. 

Positive Working Capital Cycle Example: A CD manufacturing company takes 80 days to sell their available inventory during an operations cycle and then takes 45 days for credit card payments and invoices to become capital. The company also has 45 days to pay their suppliers for the raw materials, so their working capital cycle takes 80 days and is positive.

80 Inventory Days + 45 Accounts Receivable Days – 45 Accounts Payable Days = 80-Day Working Capital Cycle

Negative Working Capital Cycle

Despite its name, negative working capital cycles are often anything but a negative impact on a business’s operations. If your business has no gap between when inventory is sold in exchange for hard capital, they very likely would run a negative working capital cycle. The most traditional example of negative working capital cycle businesses are those that only accept cash. A business that deals solely in cash and has no invoices would have a zero Accounts Receivable Days meaning it is possible Accounts Payable Days may be greater than Inventory Days, leading to a negative working capital cycle.

Negative Working Capital Cycle Example: A local farmers market takes 30 days to sell all of their available inventory during one operations cycle. The farmers market only accepts cash and has no invoices. Since the farmers market has all capital on-hand at the point of sale, they have 0 Accounts Receivable Days. The farmers market takes 45 days to pay for raw materials and liabilities, meaning their working capital cycle takes -15 days.

30 Inventory Days + 0 Accounts Receivable Days – 45 Accounts Payable Days = -15-Day Working Capital Cycle

Improving Working Capital with Tactical Financing

One of the most frustrating parts of business operations is waiting for invoices to cash after making a sale. The 30, 60 or even 120 days necessary for invoices to become capital will take a massive toll on a company’s working capital cycle. That number of days is a business’s “Accounts Receivable Days” and by shortening the amount of time an invoice is in limbo, a business can massively improve their working capital cycle.

Invoice factoring is an agreement between a business and lender where the business sells unpaid invoices to a lender who then pays approximately 95% of the invoice’s value up front. In most invoice factoring agreements, it is then up to the lender to collect on the original invoice. When the client’s invoice eventually clears, the lender, or factor, will send a final percentage of the invoice to the business while usually keeping a 3% fee for the transaction.

By expediting the time an invoice takes to become capital, a business can massively increase their cash flow and in turn improve their working capital cycle. There are, however, counterexamples where an invoice factoring agreement may extend a working capital cycle. If an invoice factoring agreement allows for business recourse, then the business, not the lender, is responsible for invoices that go unpaid. This can also be the case if a factoring company is unable to collect, or has a difficult time collecting on an invoice.  In these cases, it could be a while until you get that last percent from your invoices. If you would like to learn more about invoice factoring and other working capital loan options, please see Kapitus’s comprehensive guide detailing the several working capital loans options for small businesses.

Shortening Your Working Capital Cycle

Without becoming a solely cash business there are several strategies to shortening a working capital cycle to increase cash flow.

Reevaluate Manufacturer Options: When was the last time your business checked your supplier’s competition? Depending on your business and operation cycles there are likely several optimizations to your business which could effectively reduce Inventory Days. Is it possible to buy your most frequently used materials in bulk? Have you considered working with emerging manufacturing hotspots like Malaysia or Indonesia? Sit down with your team and think creatively about how your business can take advantage of rising globalism and manufacturing options to keep inventory turnover and quality high. Keep an eye out for local manufacturing options alternatives as well.

Renegotiate Existing Deals: Most modern operation cycles require several cultivated relationships with manufacturers and liveries which should be regularly assessed to make sure your business is getting the best deal possible. When your business buys raw materials from a supplier, how long is your credit period? That credit period is the same as your business’s Accounts Payable Days and by expanding the number of days your business must pay back suppliers in, your working capital cycle will shorten as well.

Kick Up Accounts Receivables Collection: There are several other ways to speed up accounts receivables collection without invoice factoring or financing. By shortening the amount of time between a sale and when that sale becomes liquid your business’s cash flow and working capital cycle will both improve. Consider making an updated A/R Aging Report which consolidates all of company’s accounts receivables data into one place for easy consideration and optimization. Does your business offer payment plans for high-volume purchases? A great way to attract new clients and boost monthly receivables is to offer structured payment plans. Another strategy to maximize your business’s accounts receivables is to increase your client base.

Final Considerations and the Nature of the Working Capital Cycle

Barring very specific industries, having a positive working capital cycle is a good indicator that a business is financially sound. Regarding growth, however, it is often difficult for companies to expand when their operational cycles leave low liquidity and high asset value. This is why several businesses seek financing from banks or private lenders to cover working capital and in turn reinvest in their own operations.

There is no universally ‘good’ working capital cycle because every business’s operations cycle is different. If your business has several long-term invoices, invoice financing could be a great way to kick up your working capital cycle. If your slowdown is on the manufacturer’s side however, you will need to consider wholly different solutions.

If you would like to learn more about your business’s working capital cycle financing options, please get in touch with a Kapitus financing expert who can address your unique situation.

professional employer organization

What is a PEO? And How to Choose the Right One for Your Business

/in , /by

You probably started your business because you enjoyed the work. Maybe you opened your ideal restaurant or started an electrical contracting business. That part was fun, but other responsibilities surfaced. Now, you have to deal with employees’ human resource issues, find ways to offer benefits and make sure all payroll taxes were filed and paid. Fortunately, small business owners don’t have to cope with these responsibilities by themselves. Professional employer organizations can lift those chores off of the owners’ shoulders. This helps business owners focus more on managerial tasks and growing their businesses. Now, what is a PEO, exactly?

What is a PEO?

A professional employer organization and a business enter into a shared relationship known as “co-employment.” Co-employment means that the PEO is the employer on record. They provide human resource support and handle payroll functions – while you, as the owner, keep the authority and responsibility. You’ll still manage your employees’ day-to-day activities.

Through the co-employment model, PEOs:

  • Are responsible for paying wages, managing employee compensation claims and overseeing other wage-related requirements
  • Assist with regulatory paperwork and compliance issues
  • Manage human resource issues and risk management functions
  • Provide employee benefits. Benefits include- but aren’t limited to – health insurance, unemployment insurance, Section 125 plans and other voluntary insurance products.

What are the Client’s Responsibilities?

The business owner is responsible for:

  • Managing employees’ daily activities
  • Maintaining a safe work environment
  • Keeping track of hours worked and reporting these figure to the PEO
  • Making sure payroll funds are paid in advance to the PEO

Advantages of a PEO

PEOs can take time-consuming HR tasks and responsibilities off your plate. A PEO:

  • Handles all human resource activities so you can focus on managing and growing your business
  • Provides competitive benefits and health insurance. A PEO has the purchasing power to negotiate better health insurance rates and more affordable benefits, such as a 401(k)plan, dental and vision coverage. Using the lower-cost benefits from a PEO enables small- and medium-size companies to compete with and attract employees from larger companies.
  • Stays up-to-date on regulations. As a business owner, you don’t have the time to read the latest regulations. A PEO does this for your and makes sure that you remain compliant.
  • Provides attorneys and HR professionals to handle employee-related issues. PEOs give advice on proper employee termination and disciplinary procedures.

Disadvantages of a PEO

Method of pricing

Sometimes, it can be difficult to determine how much you’re really paying. Many PEOs price their programs as a percentage of wage payroll, but this figure can vary monthly. So, sometimes it’s hard to figure out how much you’re actually paying. The other pricing method is the per-employee-per-month. This approach has add-ons for setup fees, administrative fees and costs for running some payroll reports.

Inflexible health plans

PEOs partner with certain insurance companies, and you don’t have a choice. If you like UnitedHealthCare, but the PEO promotes Aetna, you have to accept Aetna.

Customer service

PEOs handle large numbers of clients and employee issues. Customer service responses can sometimes seem rushed and indifferent.

How to Choose a PEO

Choosing the best PEO for your company requires doing your homework. Here’s a list of questions to help you get started.

  • Assess your company’s needs. What do you need help with -Payroll processing, HR issues, employee benefits? Define what you need before approaching a PEO.
  • Is the PEO a member of the National Association of Professional Employer Organizations? Membership in the industry’s trade organization indicates professionalism and respect.
  • Does the PEO have experience in your industry? You want a PEO that understands the daily lives of your employees and the risks they take on their jobs. How many employees do they represent in your industry?
  • Conduct a background check; ask for references to check; get first-hand feedback directly from the PEO’s clients.
  • Are the financial statements independently audited by a CPA? You want assurance that the PEO is legitimate.
  • Are their risk management practices certified by the Certification Institute?
  • Have their ethical practices been accredited by the Employer Services Assurances Corporation? ESAC audits PEOs annually to make certain each PEO has at least a $1 million surety bond.
  • Does the PEO have certification from the IRS? Check for accreditation such as the Certification Program for Professional Employer Organizations from the Internal Revenue Service.
  • Review the fine print in the contract. What guarantees does it provide? How can you terminate the contract if the relationship goes bad?

 

According to NAPEO, the U.S. has over 900 PEOs. While you have plenty of choices and setting up a co-employment agreement with a professional employer organization will relieve you of a ton of administrative tasks, you must thoroughly investigate each PEO candidate before signing on the dotted line. You don’t want any surprises.

Free NYC Small Business Services

Free NYC Small Business Services That Give Empire State Entrepreneurs a Competitive Advantage

/in , /by

Did you know that small businesses make up more than 99% of all businesses in New York City–and employ half its public workforce? With such an economic impact, so many NYC small business services are in place to help entrepreneurs accelerate their enterprises.

Although launching and growing a small business can sometimes feel overwhelming, confusing or isolating, support is never far away. Here are some of the best free–and low-cost–NYC small business services available to Empire State entrepreneurs and small business owners.

Free Advisory Services

Do you need help devising your business plan or decoding regulatory requirements? Luckily, a myriad of NYC small business services exist in every borough. They will pair you with experts and mentors who will help you navigate roadblocks. Thousands of small business owners seek advice every year.

Bronx: The Bronx Small Business Development Center offers free small business services ranging from marketing to regulatory training.

Brooklyn: Brooklyn’s Small Business Development Center offers both online and in-person training. They help with everything from funding to financial literacy. Plus, they have an impressive amount of live networking events.

Manhattan: From financing and trade to marketing and government procurement, the Small Business Development Center at Pace University has a host of free resources and events available for entrepreneurs and small business owners.

Queens: The Queens Economic Development Corporation offers workshops, training events, one-on-one-coaching, and networking events free of charge.

Staten Island: The Staten Island Small Business Development Center exists to help both aspiring and established small business owners navigate regulatory requirements, identify viable funding sources and understand e-commerce, among other free services.

City-Wide: NYC Small Business Services Centers exist across all five boroughs. They offer free advice and resources to help small businesses start and grow. You can even take free business courses online! A three-minute application helps pair you with the curriculum best fit for your needs.

Free Meeting Spaces

Are you looking for a spot to host an important business meeting or collaborate with your cofounders? The following locations are available at no cost to entrepreneurs:

  1. The Freelancers Union invites entrepreneurs and freelancers to work from Freelancers Hub, its DUMBO co-working space up to eight days each month at no cost. Their hours are 9-5, Monday – Friday.
  2. The New York Public Library’s Science, Industry and Building Library (SIBL) allows entrepreneurs to reserve meeting rooms online. You can do so for up to six people and for two-hour time blocks, Monday through Saturday.

Free Resources By Classification

New York has one of the most diverse populations in the country. Services exist to help give small business owners of every background a competitive advantage. If you’re a minority, woman, immigrant, or veteran, you will find enormous value in the services tailored to you. The New York State Department of Labor offers a curated list of links on its website.

The important thing to remember is: you’re not alone! Help for entrepreneurs and small business owners looking for NYC small business services is close by. There are dedicated mentors and volunteers who want to help you succeed. They know you have the power to create meaningful impact in your community. Asking for help could mean the difference in your business stalling or skyrocketing. Most importantly, don’t be afraid to take the first step!

Do you need even more resources? The Kapitus Blog has hundreds of resources. It can help you navigate everything from marketing and technology to operations and human resources. Bookmark this page and be sure to return often for more advice and information geared specifically to New York City small business owners.

[skyword_tracking /]

2020 new year business goals

Do Your New Year Small Business Plans Include Doing Less?

/in , /by

As 2019 is coming to an end, do you find yourself making new year small business plans? 2020 is bound to be a busy year for business, but that doesn’t mean you need to add to your to-do list. In fact, you might find yourself accomplishing more by doing less. Here’s what four small business owners plan on stopping in the year ahead.

Trying to Do Everything Yourself

Many small business owners try to get everything done themselves. For solopreneurs, it may seem like there’s no other choice. Small business owners with small teams might find it easier to complete a task solo instead of training their employees on how to complete an assignment. However, wearing all of the hats can lead to burnout. By focusing on their personal power, small business owners can spend more time moving their business forward.

Suzi Whitford, CEO of Start A Mom Blog, agrees and says, “I plan to stop doing the things that I can outsource, such as proofreading, formatting posts, creating promotional images, and basic customer service. By doing this, it will free up time for me to focus on serving my students and customers in the best way possible.”

Forcing Business Tactics

There’s many great courses, programs and training for small business owners. It can feel overwhelming, though, sorting through potential sales and business tactics to find what works best for your business. Yet, it seems like every time you go online you’re inundated with advertisements about how to do this-and-that in order to grow a successful business. When you’re making new year small business plans, remember this: not all business advice is universal.

“I intend to stop over-planning and let things flow,” says life coach Victoria James. “I’m bringing on ease and choosing paths of the least resistance. I’m inviting natural business which feels good, rather than chasing it in a way that’s out of alignment with me and my values.”

new year plans for small business Photo by Felipe Furtado

Photo by Felipe Furtado

Indulging in the Comparison Trap

Do you often find yourself comparing your business to your competitors and peers? It’s easy to judge your growth based on what you see others doing. But, the problem is that you don’t see the whole story. Is your competitor really outperforming you? Does the social media highlight reel accurately reflect their business doings? No one truly knows whether another person or business is struggling. Don’t let their successes weigh you down.

“In 2020, I’d like to stop comparing myself to other small business owners, specifically mompreneurs,” says Priya Virmani, a personal stylist and founder of Privee by Priya. She continues, “It’s silly to beat yourself up based on another’s seeming success.”

Stressing About Social Media

As a small business owner, you understand the importance of social media. You also know how stressful it can feel to continuously post quality content and reply to your audience, all while doing your normal work. When you’re working on your new year small business plans, take a moment to reflect on the time you dedicate to social media, and whether or not you’re seeing a return on that time investment.

Writer Tara Bosler says, “What I plan to stop in 2020: obsessing about any social media content. If I have something to post, I’ll post. If not, oh well!”

Virmani agrees and plans to change up her social media approach in the new year. She says, “I’d like to defy the classic Facebook group model that ultimately sucks an audience in just to sell them a program. I’d like to have fun with Instagram instead. It’s so crazy to always feel like we should be milking every touch point.”

When you’re working on your new year small business plans, make sure to ask yourself, “what am I doing now that isn’t serving me, or what can I do less of so I can be more productive in other areas?” Eliminating some of your to-do list will make space for something better.

guide to pos systems for small businesses

Guide to POS Systems for Small Business

/in , /by

Small businesses face stiff competition, and they need every advantage they can get. Sometimes, an advantage can be found in an unlikely place, such as your point of sale (POS) system. POS systems provide an array of functionality that can help you with marketing, employee management, inventory management and payment processing, among others. So, getting the right system that meets the needs of your business is one way to gain an edge. But, how do you know which POS system is right for you?  Let’s start with the basics.

What Are POS Systems For Small Business?

By definition, a point of sale is where a sales transaction takes place. It could be at a register in a brick-and-mortar store, on a mobile device or even online.

A POS system combines hardware and software that retailers use to process sales transactions. It is not just a credit card processing system.  In reality, a POS can handle a variety of back-office functions in addition to processing credit card payments.

What Functions Does a POS Perform? A POS can have the following capabilities:

Scan barcodes – Use a barcode scanner to quickly input product and sales data into the system.

Process card payments, returns and exchanges – The credit card reader should input the customer’s credit card data from swiping a magstripe, dipping cards with chips or accept contactless payment such as Google Pay and Apple Pay. For mobile sales, you can connect card readers to tablets and smartphones per the headphone jack. Purchases made through your website can be processed with online POS software.

Track customer history – Keep records of customer profile data and sales history. Collect customer contact information and create lists for email marketing.

Keep records of employee performance and time management – Track employee clock-in and clock-out data and record sales performance for commissions.

Track inventory – Maintain current inventory in-stock levels of products and issue alerts for low stock amounts to reorder and prevent missed sales. Store supplier information, wholesale costs and discounts and issue purchase orders.

Produce reports- Produce sales performance reports. For example, track top sellers, identify slow movers and predict seasonal fluctuations.

What are the Key Elements of a POS System?

Pricing – POS systems can cost as little as $0 per month up to $300 per month. All systems charge a payment processing fee. They can be cheap or very expensive to operate, depending on the additional functions provided.

Hardware – POS systems typically work on most Android devices, iPhones and iPads. If you have one of these already, you can start your POS with a low-cost or free card reader and few other hardware costs. However, if you don’t have a barcode scanner, you’ll need to purchase one. Additional hardware costs could be anything from a printer for receipts to a cash drawer.

Plans – POS plans should range from a free (or low-cost) option with little more than the capability to process credit card payments, but have the flexibility to add more sophisticated data tracking and reporting as the business grows.

Top POS Systems for Small Businesses

Square

Square is the POS of choice for mobile businesses. Additionally, it’s also an economical favorite for retailers with physical stores. Many users conduct all of their business with just an iPad and a basic Square plan.

Advantages – Square has a basic plan with a zero monthly cost, making it easy to get started with a POS system. The software is intuitive and easy to use.
Disadvantages – Transaction fees can be slightly higher that other POS systems. Square charges more for transactions with manual entry than other POS providers.

Lightspeed

Lightspeed offers more than 40 detailed sales, inventory and analytic reports. It provides nearly any type of data analysis that a retail business would need.

Advantages – The basic plan starts at $99/month and upfront purchases of hardware can approach $700, but you will receive extensive and sophisticated data analysis and reports.
Disadvantages – The ecommerce feature is only available at an additional monthly fee. Shopify and Square offer ecommerce platforms for free. Unlike other POS providers, Lightspeed requires a contract, which means you’re stuck if you don’t like their system.

Shopify

Shopify has a reputation as one of the best POS systems for ecommerce. It’s easy to set up and has a wide range of options that are customizable for any small business. It also scales up as a business grows.

The plans range from a basic option at $29/month up to the Advanced Shopify at $299/month.

Advantages – Shopify has affordable subscription and processing fees and offers a 14-day free trial. Its ecommerce tools are some of the best.
Disadvantages – Data reporting on the Basic Plan is limited. Shopify doesn’t have a free subscription plan; options with more features gets expensive.

ShopKeep

ShopKeep is designed especially for cafes, bars, boutiques and specialty shops. It offers very detailed product and inventory tracking and goes further by keeping track of recipes and ingredients, for example.

Advantages – It offers helpful features for sales staff management, inventory control and reporting.
Disadvantages – It doesn’t have fixed-price plans. Company representatives prepare a custom quote for each business application. Generally, higher business volumes reduce the credit card processing fee. ShopKeep offers a free version, but limits the number of items in inventory, number of employees and registers. Even the sales amount is restricted without an upgrade.

How to Choose a POS System

Use the following criteria and ask yourself these questions to determine the best POS systems for your small business:

  1. Price – Is the software and hardware reasonably priced with low monthly fees for a small business?
  2. Payment processing –Do the transaction processing fees compete with other providers?
  3. Inventory management – Does the system produce inventory data that you actually need?
  4. Customer data management – Does the system collect customer profiles, keep lists for email marketing, track customer purchase history, have a customer loyalty option, and offer gift cards?
  5. Employee data – What information does the system provide for individual employee performance?
  6. Customer support – Does the provider have free, live support, and is it available 24/7?
  7. Integrations – Does the system integrate selling, marketing and accounting reports?
  8. Analytics and reporting – What data do the reports provide? Can data be exported? Will the system produce visual charts and graphs?

Making Your Choice

First, decide what you want in a POS system. If it’s just processing credit card transactions, a free card reader with processing charges per individual sale and no monthly fee is good enough. But if you’re looking to add customer data for marketing, inventory management and tracking employee performance, then you’ll need to purchase a system that provides those additional functions.

Improve productivity by whittling down your choices.

Want to Improve Productivity? Whittle Down Your Choices

/in , /by

Humans make upwards of 35,000 decisions each day. Would your ability to make 40,000 help you improve productivity?

It turns out that the exact opposite is true.

All humans experience decision fatigue. In the simplest of terms, the more decisions people make in a defined period, the lower the quality those decisions become. That’s probably not the impact you want your decision-making to have in your company. What’s also true, however, is that too many options can make you over-thing and jam-up sound decision-making, too.

That’s called analysis paralysis, and it can do a real number on your productivity, and not in a good way.

Let’s have a look at analysis paralysis – what it is, why it’s a problem, and tips to help you avoid it. By taking a few simple actions, you can improve productivity throughout your company and leave the logjam of analysis paralysis far behind.

Do more choices improve productivity? No.

“Think about when your computer is sluggish, lagging, and not operating well,” says Joanne Ketch, a licensed therapist well-versed in how the brain makes decisions. “You bring up Task Manager. You see all the programs and processes that are running, using your system’s resources whether you are aware of them or not. They are slowing your computer and getting in the way of its functioning, reducing the computer’s productivity. Look at humans as having a Task Manager.”

Ketch says that people aren’t always aware of what they have running in the background, slowing productivity. The key to boosting productivity is becoming aware of what’s running in the background.

When you’re in a position of leadership, decision-making is literally your job, and you likely have a myriad of pressing matters running in your background. There’s so much on your plate, and you don’t know where to focus first. How do you choose where to focus your time when you have so many options?

“We all get to choose where we focus,” says Neen James, author of Attention Pays: How to Drive Profitability, Productivity, and Accountability. “When our attention spans are split, we’re allowing them to be split between multiple stimuli, inputs, devices, and decisions.”

When your Task Manager is on overload, you’ve allowed too many pieces of input into your machine. That’s what causes analysis paralysis. To improve productivity, smart leaders decrease their input. They reduce what’s running in the background.

Tips to decrease analysis paralysis

To help take control of your Task Manager, there are active steps you can take to help both yourself and your teams.

Reduce distractions

“Turn off all bells and whistles, notifications, and stimuli that are wasting your attention. Focus on the evidence you have and trust your experience,” says James. Distractions add to what’s running in your background.

Consider outsourcing

“A cleaning service or even an errand in your personal life,” says Ketch. “From the business side, look at what roles and responsibilities it’s time to outsource or delegate.” Even important decisions and critical data can be distractions if they’re drawing your attention away from decisions that most need your attention and expertise.

Ask bigger, better questions

“Does this get me closer to my goals? Is this in line with our strategic objectives? Will this move the project/initiative/goal forward?” James says. Questions like these will help you decrease distractions, keep you from over-thinking and help you to identify areas where you can delegate or outsource. They’ll also help you focus on the most critical decisions to move your company forward.

Set boundaries

“Productivity drain often comes down to boundaries,” says Ketch. “Boundaries from a personal or work relationship standpoint are barriers to success and distractions.” Ketch suggests that leaders explore working with a mentor, life/business coach, or therapist to identify areas and activities that could be hampering productivity.

Set timelines

“Set a deadline, make it public, and honor it. Hold yourself accountable,” James says. By being public and forthcoming about schedules, you’re also helping your team know when it’s time to end the idea gathering/brainstorming phase and switch over to narrowing down options to those most promising. Analysis paralysis often happens when teams fail to make the switch from gathering ideas to narrowing them down.

Self-care

“Build business retreats and self-care into your planning,” Ketch says. “Do not rely on what’s leftover to sustain your energy.” If you’re not taking care of yourself and encouraging your teams to do the same, productivity isn’t likely to accelerate or improve.

Now, you have six actionable ideas to improve productivity and keep both decision fatigue and analysis paralysis at bay. When you can shift your input and focus to the matters where you’re the most crucial decision-making component, you’ll free up the mental energy needed to make better decisions faster and with fewer distractions.

[skyword_tracking /]

How to avoid small business failure

5 Reasons for Small Business Failure (and How to Avoid Them)

/in , /by

Small business failure is a fact of life every budding business owner must face. As exciting as a new entrepreneurial venture can be, it’s foolhardy to rush into the experience while neglecting certain key elements, such as cash flow management, hiring and retention, marketing and operations. It’s a tall order under any circumstances, but even more so when the life of a fledgling business falls on one person’s shoulders.

There are many reasons for why a small business doesn’t make it. One primary cause, according to Investopedia, is that successful business owners “must possess the ability to mitigate company-specific risks while simultaneously bringing a product or service to market at a price point that meets consumer demand levels.”

This gargantuan challenge may be why approximately only 20 percent of new businesses make it through a full first year of operation, and why almost 50 percent of small businesses can’t endure to five years or longer. Citing these statistics, USA Today notes, “The good news is that survival rates begin to flatten out after several years of operation.”

Confronting and overcoming these challenges means the difference between survival and failure in today’s marketplace. The most effective strategy involves understanding the primary causes for failure and planning beforehand how you will address them.

Here’s a look at five major reasons why some small businesses don’t achieve profit and success:

I. Insufficient capital and poor financial management

For every business owner, there’s a constant tension between understanding how much money is required to maintain daily operations and the amount of revenue that comes from the sale of products or services. When this discrepancy becomes acute, a business can simply run out of money and then be forced to shut its doors.

In fact, keeping pace with cash flow is essential to small business survival. More than 80 percent of companies close because of cash-flow-related problems, making this the number one reason for small business failure. Even “profitable companies fail all the time for the simple reason that they run out of cash.”

To offset this dire outcome, it’s critically important to create (and stick to) a realistic operational budget for your business. A budget plan must include the following:

  • Assessment of the amount of money needed for day-to-day operations
  • Costs for fixed and variable overhead expenses
  • Funds to pay third-party suppliers and vendors
  • A plan for borrowing money when needed, either through asset-based financing, investment capital, conventional loans or business grants

Experts strongly advocate researching and compiling information on these budget plan elements before you actually need the working capital. It’s better to have this data on hand when money is needed, rather than waiting until a cash-related crisis occurs.

2. Lack of business planning and a viable business model

As noted, a viable cash-flow strategy should be an essential component of a business plan. Other factors include:

  • What the business is about (its products or services, mission, vision for the future)
  • A strong financial forecasting model (based on estimated operating costs and generated revenue)
  • Current and projected labor needs (the number of employees needed now, and in the future)
  • An in-depth competitor analysis (understanding what the marketplace looks like)
  • Marketing and sales strategies (how to reach prospective customers and close deals)

Adoption of the right business model is another element to include in your plans. Study similar businesses in your industry, both locally and in other regions, and establish a model that includes some or all of these elements:

  • Planned company infrastructure
  • A milestone chart with key tasks and objectives to be addressed and completed by assigned dates
  • Hiring policies and guidelines for personnel
  • Preliminary or more sophisticated branding strategies

Addressing some or all of the above once the business is underway risks playing catch-up during a critically important early growth stage, and could quickly lead to small business failure.

3. Leadership and management shortcomings

An inability to transition from being a solo entrepreneur to a CEO or business owner with employees is another “mine-field” for many businesses.

Not every entrepreneur comes equipped with the types of leadership or management skills needed to supervise, inspire and manage a group of individuals. Someone ill-equipped for this task can make a wide range of management mistakes, such as hiring too quickly and having the wrong team on board, or failing to create a human resources policy that covers most labor-related contingencies.

Such shortcomings can result in a workplace exhibiting poor morale and low productivity, key ingredients for small business failure.

It’s incumbent upon small business owners to find the time and resources to hone their leadership skills. Take online human capital management classes. Participate in leadership webinars. Drill down deep into your professional network and locate a person who’s willing to help out as a leadership mentor. Do everything possible to prepare for recruiting and managing employees before management problems arise.

4. Absence of an effective marketing strategy

Coping with funding, putting together a business plan and starting the hiring process are big challenges in and of themselves. Assuming you have a great new product or service idea, and the means to make it available to customers when they want it, the next question is–how will you get the word out?

Some small businesses fail because they’re unprepared for the demands of marketing their company’s offerings. They lack an understanding of who their target customers are, what problems or challenges those customers face, and how their product or service will serve as a solution. These small businesses don’t pay sufficient attention to the value of branding, public relations, and related marketing efforts.

It’s never a case of “Build it, and they will come.” You have to find them!

Be certain you understand what sets your business apart–its unique value proposition. Then make every conceivable effort to get the word out there.

“Use social media, word of mouth, cold calling, direct mails, and other tried-and true marketing techniques,” advises Bplans. Find ways to encapsulate your value proposition in language customers can understand “so you can capture a market share and begin building your conversion rates.”

Marketing consumes an unpredictable amount of time, money, and resources. It’s essential to incorporate a full-fledged marketing plan within the business plan, so you have a realistic sense of what’s needed to reach and attract your target audience. Without such a plan, you risk going through all of your available cash and having little to show for it.

5. Neglecting to anticipate growth and expansion challenges

Finally, there’s the challenge associated with more successful business ventures. In a period of accelerated consumer demand and record-high sales, there comes a point when the existing infrastructure, current business model, employee workforce, and other key elements are no longer sufficient to handle issues related to growth and expansion.

A failure to anticipate this nearly inevitable event has caused many small businesses to shut down.  This is, simply, because they lacked the vision and resources to expand when necessary.

To counter this threat, even at the earliest stages of your business, look into the following options to handle the risks (and benefits) of rapid growth:

Preparing for success is just as important as guarding against failure. With plans and strategies in place, you’re better equipped to cope with ever-changing marketplace conditions.

Yes, small business failure happens, sometimes at an alarming rate. But research, knowledge, and drawing on past experiences and learning from others can pave the way towards a more fruitful outcome for you and your exciting small business.

increase-productivity-at-your-business

5 Ways to Increase Productivity at Your Business

/in , /by

Do These 5 Easy Things Today to Be More Productive Tomorrow

As a small business owner, do your goals include becoming more productive? If so, these five tips and techniques may make a difference.

Schedule Sleep and Exercise First

Prioritizing non-business activities such as sleep, exercise, spiritual practice, and time with family and friends may improve your physical and emotional well being.  And, being both physically and emotionally healthy can lead to a more productive day. For example, one MIT study found that exercise helps us better process information. A University of Arizona study found sleep-related symptoms negatively impacts daily productivity.

Schedule non-business activities in your digital or paper day planner before anything else. Then when business calls, you’ll be in the best physical and mental state to work efficiently and increase workplace productivity.

Track Your Daily Energy Levels and Distractions

Your energy levels rise and fall throughout the day, although energy level patterns may vary from person to person. At the same time, the level of distractions around you also varies.  This combination can significantly enhance or impede your productivity.

Recently, 75% of respondents to a study by online course provider Udemy said they get more done and are more productive when workplace distractions are reduced. And yes, this includes social media.

Record your energy level as high, medium, or low every couple of hours during the day.  While doing so, make sure to note when distractions to your workday are highest. Then simply rearrange your workday so you’re performing tasks requiring high concentration when you’re feeling energetic and distractions are low.

Batch Your Tasks

Although being more productive means getting more done in a day, performing several tasks at once (multi-tasking) could actually hinder your memory and reduce your productivity. According to recent findings from the Stanford Memory Laboratory, you may boost your productivity by scheduling your time to avoid multi-tasking and incorporate batching, performing similar tasks together in one time block.

Consider your typical weekly or monthly tasks and how they could be batched.

Template, Replicate and Automate

To maximize the impact of batching on productivity, create a template to cut the time required to perform each batching activity. For example, filling in a report template may save time versus creating one from scratch. You may be able to replicate the time savings by using the outline template as a base for other similar activities, such as writing case studies or white papers.

Today’s business world is full of repetitive tasks. Automating those tasks can boost productivity, helping you get more done in a shorter time. According to a 2017 study, 69 percent of surveyed workers say that automation’s biggest benefit is in reducing time spent on repetitive tasks. Study your own repetitive tasks, such as data entry, creating reports, and even paying bills. Look for opportunities to use technology to automate those tasks, such as setting up recurring bill payments through online banking. The more you’re able to automate, the less chance you have of wasting time.

Delegate or Dump

What are you doing that someone else could do instead? And what are you doing that could be scrapped entirely?

When you delegate important tasks to other team members, you free up time to tackle other tasks, increasing your personal productivity and earnings. In a Harvard study of law firms which practice delegating routine work to associate lawyers, partners earned between 20-to-50 percent more than they would have without delegating the work. These partners can take on more clients and produce higher quality work on difficult cases without the distraction of the more routine cases.

Review your most recent “To-Do” lists and identify at least three activities that can be delegated or dumped. Then allocate the time saved for growing your business, pursuing new clients, or developing new product lines.

About Us

Products

Contact Us