Category: help & advice

Growth Hacks for Small Businesses:

Deciding on an online marketing plan can be overwhelming for small business owners looking for affordable ways to nurture steady, sustainable growth. With time in short supply, the key is to find one or two growth strategies that will get results at minimal cost.

These proven growth hacks offer business owners a few simple, cost-effective ideas for attracting new customers, increasing brand awareness, and ultimately, getting more sales.

Build your email list

Recent research shows that e-mail marketing works; in fact, it’s been shown to promote a 17% greater conversion rate than social media marketing. Permission-based marketing is based on a friendly exchange – your customer’s email address for a promise to provide value. As you nurture a positive relationship via your newsletter, with special offers, useful or inspiring content and discounts, over time your customers will be more inclined to buy from you. Incentivize new customers to sign up with contests, giveaways, referral bonuses and webinars. The bigger your list, the greater the return when you have a new product to promote – so if you decide to launch a company e-newsletter, be sure you make a consistent effort to attract new subscribers. This Forbes article offers 50 ideas on how to grow your list.

Offer social proof

One of the biggest challenges for small business owners is converting online leads into paying customers. It comes down to convincing people you’ve never met that you deserve their trust – which is why social proof is so important.

Adding testimonials to your website is a simple way to convince potential customers they won’t regret buying from you. In fact, it’s been shown that this simple form of social proof can increase conversions by 34%.

Let your customers know you’d like their feedback, and ask for permission to include their positive comments on your company website.

Other kinds of social proof you can use to win over customers online include:

• Case studies
• Media mentions
• Customers logos
• Accreditations and certifications.

Create partnerships

This simple growth hack is effective both on and offline. Initiating a partnership with a company that provides complementary products or services can quickly increase each of your email lists – give your sales figures a big boost.

There are many ways a business partnership could work – you might negotiate a joint venture, host an event where you promote each other’s products, run a giveaway together or launch a combined product or service.

Final Tip

As you try out some new ways to market your business, be sure to set actionable and achievable goals. For instance, you might make 1,000 newsletter sign ups over the next quarter one of your priorities – or increasing your blog traffic by 50% by end of the year. Make it a habit to review your metrics on a regular basis to see how well your strategies are working. Then use that data to set new goals to keep winning over customers and expanding your business.

If you are looking for Fulham accountants or a tax advisor in London, get in touch!

e: office@londonaccountants.co   t: 0203 137 9791

Kind Regards,
The Team at London Accountants

Surprisingly Destructive Habits You Should Avoid as an Entrepreneur

Entrepreneurs want to have their hands on every aspect of their start-up. This is understandable, as many entrepreneurs come into their respective industries from a place of passion. Their passion will drive them to spend long nights at the office, working hard every hour of every day. Unknown to them, this kind of attitude can actually lead to some destructive outcomes.

You must avoid these habits, despite the allure of their short-term benefits.

1. All Work and No Play

You’re probably under a lot of pressure from your investors, your family, or even yourself. This pressure is doubled if your product is brand new and thus untested. It needs to work well or at least prove itself viable right out of the gate or it’s all going to go wrong. The pressure and need for success make your hobbies and relaxing seem like a waste of time. Moments spent on your hobbies could be moments seemingly better spent on your marketing campaign or your product.

The fact is that you still need to take time to relax, for two important reasons. The first is that the lack of relaxation will lead to burnout, which can lead to lost days from sickness and reduced output. The second is that creativity actually comes from a place of enjoyment. You may find your creative output limited if you spend all your time looking at documents and numbers.

Set aside time for more creative tasks. Play games, take in a movie or an art gallery, whatever you enjoy.

2. Spreading Yourself Too Thin by Multitasking

Entrepreneurs, naturally, want to make sure that every part of the business works out. Every little aspect is of interest to them. They juggle various duties at the same time, multitasking as best they can.

This seems like a good idea, until you realise that a lot of things require and deserve your undivided attention. It can start small – you may miss details during a small meeting, or a client may remark that you seem disinterested or distracted. These small things can easily snowball in reduced overall efficiency. Those small details might result in half your company not knowing what the other half is doing, or that client turning to another provider because you just don’t seem into it.

Focus on finishing one task at a time. If you find that you need multiple things done at the same time, delegate.

3. Micromanaging Your Staff

You’re not going to know everyone on your staff. The vast majority are going to be strangers. You might never see some of them in person if you use remote staff. You may find it difficult to trust them, no matter how strong their credentials look.

Resist the urge to micromanage every little task, especially for virtual workers. Just because you can’t see them working doesn’t mean they’re slacking off. If you don’t need to give input, don’t bother them after you give orders.

4. Being Present at Everything

Some entrepreneurs think that they’re the heart and soul of the company. It’s their idea, and they may believe that without their presence it will amount to nothing. At every meeting, whether it’s with a client or for a marketing campaign, they’ll be there, showing their dedication and making sure every goes exactly according to plan.

You might be thinking of doing the same. It seems simple when you think about it – you just have to be in a lot of places. It’s worth it, in your head. In practice, however, it turns out differently. Practically speaking, at some point you’re going to have to decide between two things and you may hold up the meeting as they wait for you. You may also end up driving yourself into the ground, burning yourself out for things that may not have even needed your presence or attention.

It might be hard to admit, but parts of your business can and will survive without you. You need to pay attention to the tasks that actually require your presence and attention while trusting your crew to handle the rest.

5. Believing That Long Hours Immediately Means Big Returns

The traditional image of a hard worker is someone who spends their days and nights at work, devoting the entirety of their life to the job. You might be tempted to do the same in the hopes that your start-up will make profits sooner.

Before you do that, take a look at what you can actually get done by staying at work all the time. True, there are some instances wherein burning the midnight oil would actually produce better results, but that isn’t true for every situation. Make sure that if you do spend long nights at the office that they’re going to result in a tangibly improved outcome for that specific task.

An entrepreneur’s success revolves around efficient use of their time and effort. There’s only so much a person can do in one day without running themselves into the ground. Don’t just look at the short-term gains – look at what it can do to you and your start-up in the long run.

If you are looking for Fulham accountants or a tax advisor in London, get in touch!

e: office@londonaccountants.co   t: 0203 137 9791

Kind Regards,
The Team at London Accountants

Working out an effective marketing budget!

“How much should I spend on marketing?”

Most small business people this question at some stage. Many small business people find working out how much to spend on marketing a tricky exercise to calculate.

Generally there are five ways to work out a marketing budget for the year. Remember that these are marketing budgets, not advertising budgets.

Marketing covers everything you do in your business that creates awareness, including such activities as advertising, brochures, competitions, free tastings, demonstrations, trade shows, travel, personal selling, direct mail, sponsorships, etc.

1. No idea at all method

Some businesses don’t have any budgets, and just advertise either when they feel that sales have slipped and they need extra business, or when they get duped into advertising by some advertising salesperson (“Buy now and we will give you 50% extra free!”).

Ever wondered why they offer you the freebies? Usually because it’s such a silly time to advertise that all their regular clients are holding back and the sales rep is desperate!

Many businesses are just too busy during certain times of the year to think of advertising, and if they did, it would be a waste as they would not be able to handle the work anyway. Suddenly, however, sales fall (perhaps due to seasonality) and then the business starts advertising.

However, this could be a waste of money as often you’re advertising at the wrong time, or advertising to get instant sales, which is unlikely to happen. So the problem is that the advertising money is spent during slow times (this hurts), and that it is spent to fix a problem instead of to create new opportunities.

2. Whatever you can afford method

Here you just spend spare cash (yes, spare cash may exist!) on advertising. So the advertising is dependent on cash flow.

During the good times you advertise more, during the bad times you cut the advertising. The danger here is that if business falls, and you cut advertising, then the situation is likely to spiral out of control.

How can you climb out of the situation when there is no money for marketing?

3. The percentage of sales method

This is a popular method.

Typically, you work out at the start of the year what percentage of sales you want to spend on advertising.

For example, if sales last year were £200,000 and you decided to spend 5% of sales on advertising, then you’d have a budget of £10,000 (£200,000 x 5%).

The problem with this method is you may not actually need £10,000 worth of advertising to achieve your sales target. What if you can only do so much? If £4,000 spent on marketing creates enough work for you to be flat out, then the other £6,000 is just being wasted.

And what percentage should you use? 3 – 6% of sales is an average, but the figure obviously depends onwhat industry you are in.

For example, here are some advertising-to-sales percentages researched in the USA for marketing budgets:

• Couriers 2.1%
• Rental car companies 2.9%
• Computers 5.1%
• Games and toys 18.4%
• Cafes 5.6%
• Hotels/motels 3.8%
• Sporting goods 5.0%
  
  So what percentage you use all depends on your activity. If you are a retailer, then you will spend more on advertising than a manufacturer who concentrates on personal selling to suppliers.

4. The ‘whatever the competition are doing’ method

This is the cheat’s way.

Find out what the competition is doing and then spend a similar amount on similar promotions.

This approach has an obvious problem: what if the competition has been using method number one – the ‘no idea’ method?

For example, a well-known retailer went into receivership after spending large amounts of money on TV and radio advertising. Now if you had copied that business, you might have found yourself down the gurgler as well!

Never think that the competition or the larger businesses know what they are doing, as often they do not. Many large companies spend thousands of pounds on wasted promotions. Just watch TV adverts every night to spot the ads that really represent a waste of money.

Then again, copying the competition is basically a poor strategy anyway. You should always strive to be one jump ahead of the opposition.

5. The objective and task method

At the start of the year, select the targets you’ll be aiming at over the next 12 months. Work out what you want from each of these targets (such as 100 new customers, or each existing customer to spend another £100, or an increase in the average sale, or whatever).

Then specifically state what you want to do to achieve this, estimating how much it will cost (common sense will give you guidelines, for example, a small business will not be spending £100,000 on TV advertising).

Complete this exercise for each of your targets, then add up all the costs, and this will be your marketing budget for the year. Points to note include:

Always have a cash reserve for marketing, so you can take advantage of any opportunities that may arise during the year. Remember, not only can you not predict what may happen (for example, some action by your competitors), but the whole point of being in a small business is having the flexibility to adapt to market forces.

Your objectives must be specific, so that when you’ve reached them, you can choose to stop any further marketing expenditure if you wish to remove any wastage. Of course, you could continue and look for more growth. The point is, you—not someone else—make that conscious decision to spend your whole budget.

Conduct a break-even analysis. For example, if you’re spending £1,000 to get 50 new customers to spend on average £50, then sales will be £2,500. Will £2,500 in sales generate enough profit to cover the £1,000 spent on marketing?

You may have a number of methods that you have used in the past, which you know work. Fine, just include them in your plan.

You may have to spend a certain amount of money just to keep your existing customers and maintain market share. Fine, but again make sure this is in your plan, and you review the effectiveness of what you’ve always done.

Remember to monitor results!

Finally, always have a method of monitoring if your marketing is working or not, otherwise you’ll fall into the ‘no idea’ category that far too many small business owners belong to. You can’t refine and improve your marketing spend unless you measure the results.

If you are looking for Fulham accountants or a tax advisor in London, get in touch!

e: office@londonaccountants.co   t: 0203 137 9791

Kind Regards,
The Team at London Accountants

How to create good habits in business!

If you’re like most small business owners, there are never enough hours in the day to complete every task on your list.

Often you’re faced with prioritizing what you need to do right now – deal with a customer, meet a deadline, attend an event – and the things you know you should do for the ongoing growth of your business.

Scheduling time to attend to these business activities on a regular basis is a great way to get on track for greater success.

Know your numbers:

It’s not uncommon for business owners to lose touch with how well their business is performing on a day-to-day basis. But an awareness of your real time income and expenses is the key to making better decisions that will nurture growth.

• Implement these changes and see the difference they make in your business:
• Switch to an online accounting solution that offers access to real time data anywhere, anytime
• Monitor your finances on a daily, weekly, monthly, and quarterly basis; review the data with your accountant often
• Check in on your other numbers, too – your website metrics and software analytics – so you know whether your marketing, lead generation, and sales tactics are working.

Update your business plan:

Companies should update their business plan at least once a year. Or sooner if there’s an upcoming change that requires planning, financing, or re-assigning resources (for instance, a product launch, an opportunity to start importing/exporting, or a new side business).

Many business owners neglect to revise their plans on a regular basis. They end up operating on autopilot, losing sight of their bigger goals and the steps they planned to take their business to the next level.

The start of a new year is an excellent time to set goals, mark milestones, and start implementing your plans. The timing also lines up nicely with closing out the previous year’s books, so you can plan with your latest annual figures in mind.

Hire help:

It sounds simple, but the self-sufficient, independent nature of many entrepreneurs can make it difficult to get comfortable delegating responsibility. Finding the right people to relieve the burden of doing everything, all the time, is the only way a business can scale and reach its potential.

Think carefully about how you spend your days. Are you still at the point where you want to – or need to – do it all? The ultimate success of any company is to reach the point where it can run without you, so you can enjoy a holiday, pass the business on to a family member, or sell it.

It can take time to find the right people that you can trust to perform their jobs well and continue to grow your business. A recruitment agency can help you craft an attractive job description and recruit so you can focus on strategies that can bring you greater enjoyment and success.

Developing new business habits takes time and commitment – but the pay off is well worth it!

Which of these business habits is most important for you to commit to this year?

5 signs you’re having cashflow problems!

Whether it’s for personal use or for your business, cash flow is important. The movement of money in and out keeps everything running smoothly, and you have to know where you stand.

But what if it seems that your cash flow isn’t really, well, flowing? If it seems that you’ve tightened your belt in every area and still coming up short, you might have cash flow issues.

Here are some telltale signs that your cash flow is actually at a standstill.

1. You’re using your credit card every month

Lots of people use their credit card for all purchases these days, and that’s okay – as long as you’re also paying it off. There are definite advantages to using your card, like points or rewards, but these perks are irrelevant if you’re spending money that you don’t actually have. If you can’t pay what you’re spending on your card with cash every month, it’s time to reevaluate how you’re using that card. Think of the real pounds you’re spending every time you tap at the till, and if you don’t have real money to pay off your purchase, reconsider it.

2. You can’t cover your bills

This is a major red flag, and a sign that your budget doesn’t add up. All of your bills need to be accounted for every month, and that includes setting money aside for large future expenses, like taxes. Bills should really be accounted for first, right up there with money for food and shelter. If you find that it’s a challenge to pay all of your bills, it’s likely that you don’t have enough cash coming in; or you’re spending it on things that shouldn’t be as high on the priority list.

3. You’re running out of money at the beginning of the month

If all of your payments come out and you find that you’re already tapped at the start of the month, you’re likely not bringing in enough money. When we add up our living expenses and plan for all of our payments to come out, it’s important to have some wiggle room to carry you through to the next month. Unexpected expenses can pop up, and nothing is as stressful as finding out you don’t have enough money. Make sure you’re earning enough to carry you through the entire month, and not just the typically bill-heavy first week.

4. There are no other costs to cut

So you’ve gone through your subscriptions, pared down your grocery bill, cut back on your nights out, and you’re still not bridging the gap. If you’re planning for your business, maybe you’re just barely scraping by with no profits, or you aren’t left with enough money to pay yourself. When every penny you make is going toward only the necessities, you definitely have cash flow issues. If you’ve cut back in every imaginable area and are still struggling, you need to find a way to bring in more money. It’s as simple as that.

5. You don’t have an emergency fund or cash chest for difficult times

This sign goes largely ignored by many people these days, with the cost of living being so high. It’s very difficult to save any money under these circumstances, and the reality is that most people just don’t. But don’t ignore this telltale sign that your cash flow isn’t healthy. It’s crucial to have something saved for a rainy day, and putting some money in your savings each month must be done, just like any other bill. Otherwise, you’re likely to lean on credit when these surprise expenses inevitably occur.

Final thoughts

It’s easy to ignore cash flow issues when we have the safety net of credit and if we’re managing to scrape by. But, managing your cash flow is a critical practice that alleviates stress and prepares you for the future. Pay it the attention it deserves and reap the rewards down the road.

What is lifestyle planning and how does it affect my finances?

When you think of financial planning, you probably imagine ways to increase your wealth, such as making a budget, reviewing what’s coming in and going out, and creating a plan for how to make the most of your money.

You may think of investing in stocks or bonds, or of starting a retirement fund. Perhaps you think of saving for a major expense, like a home or education for your children.

And that all counts as financial planning. But lately, the concept of lifestyle planning is giving financial planning a run for its money.

What is lifestyle planning?

Lifestyle planning is the idea of using your money to get the most enjoyment out of your life.

It means maybe foregoing the maximum financial return in exchange for something you value more. You choose to budget your money in a way that makes you truly happy. In other words…

You plan to use your money in the ways that bring you the most joy.

If the idea seems scary to you, you’re not alone. Most of us were raised with the idea that you should always save for a rainy day, put away as much money as you can, and invest instead of spend.

But lifestyle planning doesn’t mean that you frivolously blow through your life savings.

It means taking the time to consider how you want to live the one life you get. And then, working off of that vision by creating a financial plan that makes those dreams come true.

Get started with your lifestyle plan

Sit down and do some soul searching. Write down exactly what you want your life to look like.

Where do you want to live? Who do you want to live with, if anyone? What kind of car do you want to drive? Where do you want to go to school? What clothes do you want to wear? How do you want to eat? Do you want to travel? If so, how often?

Get as specific and as detailed as possible. Sketch out your perfect life in your mind.

Think about the things that are most important to you.

Once you’re satisfied with your vision, take stock of where you stand today.

How much money do you earn now? What’s your future earning potential? Are you spending money on things that aren’t actually important to you?

When you start matching up your reality with the way that you want to live your life, the gaps will become obvious. You will then be able to make adjustments. Maybe it’s not as important to drive a luxury car or any car at all. Maybe a change in career is necessary.

It’s okay if expensive items actually are more important to you than you initially thought. You can now plan for that. Or maybe it has become clear that you actually need more freedom of mobility in your career if travel is a priority.
Whatever it is that you come up with, you can start making a roadmap for how to get there.

And that’s how lifestyle planning affects your financial planning. You can’t reach your goals if you don’t give yourself the means to do it.

Once you know what you want, you can make a specific plan for how to make it a reality. When you’re ready, enlisting the help of a professional accountant will allow you to make the best financial decisions.

Get in touch if you would like to learn more about how we can help you get started with a personal lifestyle plan. With a bit of strategy, you can start living the way you envision sooner.

e: office@londonaccountants.co   t: 0203 137 9791

Kind Regards,
The Team at London Accountants

4 questions you should ask your accountant!

Ideally, you and your accountant are more than just “adviser” and “client”.

With your combined skills, expertise, and shared mission to support a thriving business, you’re more like strategic partners.

The key to achieving success in any partnership is, of course, strong communication. At your next meeting, be sure to ask your accountant these four important questions.

1. What’s my best strategy for increasing revenue?

Every business owner strives to improve profit margins – but the best way to quickly and/or sustainably grow revenue will vary from business to business.

When reviewing your financials, ask your accountant to pinpoint and suggest smart strategies for driving greater revenue. For your unique company that might mean focusing on new leads, encouraging customers to buy more frequently, incorporating cross-selling or up-selling, and/or rethinking your pricing strategy.

2. How would you assess our financial performance this quarter/year?

It’s part of your accountant’s job to stay current with your company’s financial statements and reports (i.e. your balance sheet, income statement, profit and loss statement, and cash flow reports).

Some small business owners – especially those who lack confidence in their financial literacy skills – may only want to know the basics, in simplest terms. Let your accountant know you’d like a more thorough analysis of your finances when you next meet, and help understanding what the numbers mean.

Ask for key ratios, like your gross profit percentage, and an assessment of the big picture, drawing comparisons with past performance as well as trends in your industry.

Also ask for any insights your accountant might have into the reasons for new or surprising developments, and what you can do to correct areas where your business is falling short – as well as what actions you can take to continue any positive trends.

3. How can you help me grow my business?

Your accountant should be prepared to offer professional advice to help your business expand and grow over time. Scaling a business can be tricky as it requires a company to do everything it must to keep their customers happy while adapting to change – such as new staff and new systems to accommodate a greater volume of customers.

Financial systems may need to change as your business expands; likewise, your company’s financial management may need additional support as you transition to a larger company.

Ask your accountant how you can best work together to facilitate smooth, sustainable growth with minimal disruption to operations, and for tips on how to successfully scale based on past experience with other small business clients.

4. What are your most successful clients doing?

Chances are your accountant serves as a trusted advisor to a number of clients – and therefore, will be privy to the inner workings of companies who are struggling and others who are thriving.

Neglecting to ask your accountant about their clients’ success stories is a missed learning opportunity. Even if a business has little in common with yours – operating in a different industry, or as a seller or products versus services – there’s value in learning what yielded impressive results for another company.

Alternately, you might ask your accountant how their clients overcame challenges similar to yours to help you brainstorm possible solutions.

Final thoughts

Your accountant is an incredibly valuable resource for your business – and not just at tax time. Be sure to check in every quarter so you have the up to date financial info you need, and your accountant’s professional advice when it comes to making key business decisions.