Article | April 12, 2022
“Growth is never by mere chance; it is the result of forces working together.”
- James Cash Penney, founder, JC Penney
Is the growth of your company healthy? If you are looking for an answer to this, you must measure its growth. Small business growth can be measured by using different types of metrics. However, effective business management demands meticulous planning and strategic judgments based on your organization's past performance. Assessing your company’s growth rate gives you an understanding of the current state of your organization. It also allows you to plan for the future and effectively allocate limited resources to your small business.
In this article, we will discuss how to calculate the growth of a company and the ways to improve it.
What Is Company Growth Rate and Why Is There a Need to Measure It?
A company’s growth rate measures how a particular variable has changed over a specified period. Growth rates are frequently used to refer to the compounded annualized rate of growth of company revenue (CAGR), earnings, dividends, and even macroeconomic variables such as gross domestic product (GDP) and retail sales.
The primary objective of a company's growth rate is to illustrate the company's current state and influence future planning. Rapid growth rates help you keep your success going, whereas slow growth rates highlight areas for improvement.
The growth rate can be calculated on a weekly, monthly, or yearly basis, depending on the industry and the development stage of the business. It may be computed at any business growth stage, provided the firm or investor has the necessary data. It is important to calculate the company’s growth rate to evaluate how profitable and sustainable it can be.
Key Factors for Calculating Growth of a Company
Calculating the growth rate enables you to have a better understanding of your company's current situation and plan more effectively for the future. The true challenge, however, is how to determine the growth rate of a business.
For instance, if you want to compare overall sales growth from Q3 last year to Q3 this year, you'll need the relevant revenue figures for both the quarters.
The company growth rate formula is:
Total revenue growth = [(current period revenue - previous same period revenue) / previous same period revenue] x 100
Define Your Business Goals and Gather Data Based on the Goals
The first step in measuring your business's progress is setting your objectives. Companies can focus on various growth metrics, including revenue, increased sales, profitability, and an increased client base. Having a realistic approach will help you succeed.
Data must be collected to achieve the goals after the organization has determined it. Collecting more data can help track business growth more accurately. Additional data can also assist in identifying and resolving possible business difficulties.
Evaluate Sales and Earning
As a small business owner, the first things that you will consider are sales and revenue generation. Therefore, a steady increase in money earned from commercial activities is an important indicator to keep an eye on.
The focus should be on boosting earnings after determining the core sales figure. Various factors impact earnings, such as operational costs, financing, assets, and liabilities. Analysts frequently want a continued rise in earnings per share (EPS). A company with a high EPS is considered more profitable — a regular review of sales and profits assists in forecasting the growth rates of the business.
Compute Revenue Growth
Revenue growth is one of the easiest ways to track a business's progress over time. The compounded annual growth rate (CAGR) is used to calculate growth. This computation helps quantify growth over extended periods, such as five, ten, or twenty years. Let’s have a glance at the formula used to calculate the compound annual growth rate.
The formula for CARG is:
FV / PV)1/t – 1 = CARG
However, you need to follow certain steps while calculating the compound annual growth rate:
Divide the investment's ultimate value by its original value
Increase the results by one divided by the number of years in the investment term
Subtract one from the preceding result
Use the trailing twelve-month figure to obtain the most up-to-date results.
Benchmark Your Company Against Competitors
While growth is critical within your organization, comparing growth to your competitors’ helps determine success in your domain. If you build your reputation in the market, you will get more clients and expand your business.
You can obtain competitors’ data through various digital channels such as websites and social media platforms and compare it to your own. In addition, you can get more information from news stories, trade journals, or media coverage of your competition. It gives you valuable insight into your industry's competition and helps you expand your market share.
How to Improve Business Growth?
The growth of a company is the top priority for small businesses. After all, growth and expansion create additional revenue prospects. Enterprises expand as a result of continuously refining and adjusting procedures throughout their operations. The following are a few ways to make your small business more efficient, which leads to a faster growth rate for your business.
Improve your conversion rate: You can increase revenue by improving your conversion rate. Only a small percentage of people who are introduced to your product or service end up buying it.
Create a sales funnel: After creating a classifieds-based sales funnel, you'll be able to identify and target the stages during which the majority of clients decide not to move elsewhere. In addition, by establishing a proper channel, your clients will be able to observe how they are now engaging with your organization, which will make transactions less risky and time-consuming.
Improve customer retention: Having a loyal consumer base helps you expand your business. A retention rate is the percentage of customers that continue to use your product over time and make repeat purchases. A CRM framework can aid you in maintaining control over client relationships.
It is important to measure the growth of a company regularly. Regular calculations help company owners maintain records that provide valuable insight into their business's performance, development, and expansion. Additionally, it ensures they expand at a rate, consistent with their established goals.
How do you calculate company growth?
You can calculate company growth by:
Defining the settings and collecting your data
Subtract the revenue from the previous period from the income for the current period
Divide the difference by the revenue for the preceding quarter
How do you calculate the future growth rate of a company?
Calculating the growth rate can be achieved by dividing the difference between the end and start value under consideration by the start value. Growth rates give insight into a firm's success and may be used to forecast future performance.
What is the formula to calculate growth?
Total revenue growth = [(current period revenue - previous same period revenue) / previous same period revenue] x 100
Article | April 1, 2022
“Do I need to register my business?” “How do I go ahead with my small business registration?” These are some of the most commonly asked questions. Business registration is the first step toward publicizing your enterprise. Establishing a business and the registration requirements may vary according to the firm type, size, and stage of business development.
To protect the legal security of both your personal and commercial assets, you must register your business with the government. It is not necessary to register if you run a business under your legal name. However, business registration is strongly recommended to prevent losing out on personal responsibility protection, legal perks, and tax benefits. Let's delve into the specifics of how to register, what are the registration requirements, and why it is necessary.
Pre-business Registration Requirements
Before you register, there are a few small business registration requirements that must be considered.
Identify Your Business Structure
Several business structures are available, each with its own set of expenses, risks, and tax ramifications. Your priorities determine the business structure you choose as a business owner.
The design of your firm will determine:
The processes for registering your business and paying your taxes
As a business owner, you bear financial responsibilities.
Your ability to obtain loans and other forms of financing from banks and other sources
There are different types of business structures you can opt for, each having its own set of advantages and disadvantages. This includes sole proprietorship, general or limited partnership, corporation (or C-Corporation), limited liability company (LLC), and limited liability partnership (LLP). The business structure you pick has a significant impact. This section provides an overview of some of the most used company structures.
Sole proprietorship: This is an example of a standard business structure. If you conduct a business without establishing a business structure, you are regarded as the sole proprietor.
Partnership: This is the business structure for two or more individuals who co-own a business.
Limited Liability corporation: This business structure enables the proprietor to safeguard personal assets against the firm's liabilities.
C-Corp: This structure separates the business from the owners and provides the greatest security for an owner's personal assets.
Pick A Business Location
Choosing a business location or address requires careful consideration. The business registration process and business taxes vary by state. The type of business you conduct determines your firm’s location.
Some questions you need to ask yourself:
Will your firm provide a service, sell things, or both?
What is your target audience?
Can you afford the rent, utilities, and other business-related costs at that particular location?
Will the staff, suppliers, and consumers be conveniently accessible?
Selection of a business location is an important deciding factor in small business registration.
Pick Your Business Name
Selecting an appropriate business name is a critical step in the business registration process after selecting the company location because it helps register a business name. A legal name or brand name can depend on your firm's structure and location in the United States.
It would be best if you found answers to a few of the below questions:
Is the name straightforward and distinct?
Is the domain name still available for registration?
Is the name appropriate for your business and brand?
Is the company name already in use?
How to Register Your Business?
Register Your Business Name
“How do I register my business name?” This is the first and foremost question that comes to the minds of business owners. You can register your legal name as your business name by filing paperwork such as articles of incorporation or articles of organization at the state level. However, documentation requirements vary according to the business structure and location.
If you use your brand name instead of your legal name, there are some jurisdictions that might require you to register under a DBA (doing business as) name. Here is one example:
Kat launched a business with a vintage clothing line. She formed an LLC and registered "Kat's Vintage Resale, LLC." The concern here was that the LLC does not reflect her store's branding; she would prefer to operate under the name "Kat's Vintage Resale." In this case, she can file for a DBA name.
Once your DBA is registered with your state or county clerk, the name becomes inaccessible to others. However, it may be used to execute contracts and establish a company bank account.
Register with the Internal Revenue Service (IRS)
Internal revenue service (IRS) business registration is required to receive an employer identification number (EIN). It helps you recruit staff and open a business bank account. As a result, this registration step is deemed critical.
For tax purposes, the EIN is used in the same way as a social security number. If you own a small business as a sole proprietor, you do not always require an EIN. However, it is advisable that you register with the IRS and receive an EIN to take advantage of the benefits that come with it. Apart from this, it also includes the following:
Increases business credibility helping you to enrol vendors, suppliers, and creditors
Ability to apply for government contracts
Obtain Business Licenses/Permits
You may need to obtain certain federal, state, or local business licenses or permits. The licenses you need will depend on your company’s structure.
A business license is a vital document that allows you to run your firm. As a business owner, to receive a license as a business owner, you must register. Licenses are generally granted after thoroughly inspecting them.
Most small enterprises require a mix of federal and state licenses and permits.
All the above steps are important in registering businesses and should be seriously looked into.
Why Do You Need to Register Your Business?
"Do I need to register my business?" It depends on the type of firm you have, its location, and sector. Business registration benefits the firm in a number of ways, from providing an advantage in the marketplace to securing its legal stability and from reducing tax liabilities to limiting liability.
Moreover, registering businesses brings numerous advantages. Some of them are as follows:
It ensures that you comply with applicable federal, state, and/or local laws
By registering a trademark, you can safeguard your business's unique logo and brand identity against infringement
Can prevent the legal hassle
It enables you to exert control over how the government perceives your firm
Small business registration has a significant role to play as it offers numerous benefits. Now that you know why and how to proceed with small business registration, go ahead and register your firm. Once the registration procedure is completed, your business will be regarded as a legal entity. Registration will ensure the hassle-free, smooth, and seamless operation of a business and its growth.
Why is business registration important?
Registration of a business is important for the formation of a brand identity. Additionally, it helps to build a brand reputation among consumers and stakeholders.
What are the advantages of registration?
The biggest advantages of registration are:
What is business registration?
Registration of a business entails submitting an application with pertinent information about the enterprise. Thorough research to ensure no one else is using the same name.
Article | March 30, 2022
“Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion.”
- Jack Welch, Chairman and CEO of General Electric (1981-2001)
What's in the name? This is the most common mindset that many small business owners have. However, choosing an appropriate small business owner title for your role can help you establish yourself as a leader among your clients and consumers.
When selecting titles for small business owners, make sure titles align with business aims and objectives. Your business title should undoubtedly represent the kind of responsibilities you hold in an organization. Once your business expands and scales, it is critical to focus on narrowing your duties and getting your business to the next level. Therefore, choosing the appropriate title enables you to establish who you are, the structure of your business, and your organization's culture.
Around 80% of business success is determined by the title of the ideal business owner. (Source: BD Task)
This article will help you select the right one from a long list of small business owner titles.
Why Are Small Business Owner Titles Important?
Determining the appropriate business job titles can be challenging for a small business owner. As the leader of an organization, you will frequently be referred to as a business owner, although this term may not accurately represent your roles and responsibilities.
The small business owner job title you pick should reflect your personality and your organization's culture while also clearly indicating your affiliation to the business to customers and clients. There are several reasons why choosing the ideal small business owner title is critical for both you and your firm.
Having the right title gives you and your company credibility, authority, and validity. Giving oneself a title might help you understand your obligations as your organization grows. Business position titles help your co-workers and employees understand your designation in the system and how you might support them. Therefore, titles significantly influence you and people in your immediate vicinity.
Popular Titles for Small Business Owners That Make a Difference
This title unequivocally refers to the person who founded or created the firm, from business concepts to product or service development. The term “founder” denotes that the organization is your brainchild and you have been associated with it from its very inception. While using this title suggests who you are, it does not convey much information about your day-to-day role in the firm. As a result, the term “founder” is frequently used in conjunction with a secondary firm owner title. For instance, "Founder and Chief Executive Officer" or "Founder and Creative Director."
CEO is the most commonly used title in any company and it implies that you are a strategic thinker. CEOs have a holistic view of the business and have the last word before any signature move. However, the titleholder is not involved in the firm's daily operations.
Often, there is an unsaid understanding that the position of a CEO is reserved for larger organizations. Small business owners wait until they reach a specific size before incorporating this position. The CEO of a corporation reports to a board of directors comprised of shareholders. The primary function of a CEO is to develop a well-established company and build a strong and large workforce.
C-Suite titles are lower in the hierarchy and less formal, but they give an impression that you are at the top of the firm. Various C-level titles that highlight your roles, responsibilities, and your importance to your business's executive team.
Chief software developer
Chief operation officer
Chief technology officer
Whatever may be your key area of focus within the business organization, there is a C-level title that corresponds. A C-level is the most valuable business position title. If your primary objective is to have your title that accurately reflects your role in the organization, it is the best alternative.
If the principal goal of the small business owner’s title is to give the impression that you are in a powerful position, the title “president” is unquestionably significant. The title confers a sense of authority, power, and respect on you and ensures your words and decisions are taken seriously. If your organization does not have a board of directors, you may choose to be president, as this title does not imply that you report to the committee.
Keep your corporate legal organization in mind when deciding between a president and a CEO.
How Real-world Entrepreneurs Came up with Their Business Names?
Reagan Jobe's position at the software startup EasyCheck includes the title "chief solver." The business title he chose established his position inside the corporation. As a result, when consumers encounter challenges or roadblocks, they know who to turn to for assistance.
Another example, Paige Arnof-Fenn, who used the title of “Founder and CEO” since the inception of her marketing firm, Maven & Moguls, in 2002. Her goal was to ensure that everyone knew they were speaking with the CEO. It is a common belief that people respect the position even before meeting the individual.
Tips for Choosing Small Business Owner Titles
There are a few things to be considered when thinking of business owner titles as your business grows. The following are tips for picking suitable business job titles:
Your title should clearly define your role in the company
Ensure your title indicate that you at the top of the company hierarchy
Your title needs to be aligned with your company culture
Your title should be understandable to both customers and employees
Choose titles according to your area of expertise
The small business owner titles should be assigned considering the future needs and expertise
Find the best-suited business job titles. Evaluate how they perform for you and whether the title is appropriate for your company's culture. Using the ideal small business owner titles from the above list may shape your organization.
What is the business title?
The business title is also referred to as a job title. Titles usually determine an employee's status within an organization and define their roles.
What is the best title for a business owner?
The best title for a business owner will be CEO, the highest-ranked position in an organization.
What are some business title examples?
A few business title examples are:
What is the top position in a company?
The Chief Executive Officer (CEO) is the highest-ranking official in a company and is ultimately responsible for managerial decisions that affect the day-to-day operations.
MARKETING AND NETWORKING
Article | March 28, 2022
Despite the growth of social media marketing strategies, email marketing remains the most preferred channel of communication to boost consumer loyalty. An email marketing strategy is something that you shouldn't ignore in 2022. Here are some of the top email marketing platforms.
Email marketing is one of the oldest and most cost-effective forms of marketing strategy. According to the Direct Marketing Association, email generates $42 for every $1 spent, which is an astounding 4,200% ROI, making it one of the most effective options available. The comprehensive implementation of email marketing services among small businesses is due to its easy management, which gives complete control and allows direct contact with the customers.
A good email marketing platform will let you:
Connect with your site visitors
Convert them into happy customers
Build a strong and long-lasting relationship
Through email marketing, you can target your existing and future customers without spending much, and you can make more money.
Top Email Marketing Services - 2022
Constant Contact is an excellent email marketing service for small business owners that are just getting started in the realm of email marketing. It is renowned as the industry's best drag-and-drop email builder. It helps you to create new emails that look great and are consistent with your brand, and it does not require technical experience. In fact, you can add text, photos, videos, surveys, vouchers, and events to any kind of message.
Here is one such successful email marketing campaign using the constant contact platform. Treat Cupcake Bar is a bakery located in Needham, MA, that quickly shifted its business from offline to online at the start of the pandemic. They linked their email and social marketing tools with Constant Contact to communicate critical company changes to new and existing consumers. They also included new DIY kits and an easy-to-use online purchasing system, ensuring that their delectable sweets were always available to customers. Their online sales are booming now, more than ever.
Hubspot is a well-known customer relationship management (CRM) software and the industry's most exceptional supplier of automated email marketing services. HubSpot enables you to create an entire lead generation funnel. Personalization is another strength of HubSpot. You can also A/B test your subject lines and content to improve your email open and click rates.
Take a peek at one of HubSpot's email marketing campaigns. Re-engagement campaign RunKeeper - RunKeeper used this strategy to re-engage lost users with a nice, informative email. The content encouraged recipients to give the app another opportunity by highlighting recent updates and features. It also mentioned new perks that the receiver may not be aware of. The “Hi friend” welcome and “You rock” closure make the email feel more friendly and less confrontational.
SendinBlue is a feature-rich SMS and email marketing platform designed specifically for businesses. It is a robust email service provider that enables organizations to leverage email marketing campaigns and automation to foster stronger relationships. In addition, SendinBlue is the only company that gives you unlimited contacts and emails, no matter what plan you choose.
Chef Nuit Regular and her husband Jeff run some of the best and most influential Thai restaurants in Toronto, including PAI, Kiin, Sabai Sabai, and Sukhothai. After the COVID-19 crisis in early 2020, the team needed email marketing tools to help them diversify their online channels, keep in touch with existing consumers, and promote their new e-commerce vertical. So, they used SendinBlue for their email marketing campaign. Here's what PAI's Marketing & Communications Manager, Bonita Mok, had to share:
"Our experience with Sendinblue has been great so far. We are happy to be able to reach our customers and maintain a close relationship with them. We normally have a 30 to 40% open rate which means great engagement!"
Convertkit is a scalable and effective email marketing service provider for influencers, bloggers, writers, publishers, and digital marketers. They create registration forms, popup forms, course signups, and landing sites using customizable themes. ConvertKit also allows you to quickly separate subscribers into those considering buying and those who have already bought. This enables you to enhance conversions with more personalized automated emails.
Monica formerly managed Affilimate, an affiliate dashboard and analytics solution for bloggers and affiliate marketers. Everything was fine until the pandemic hit. Her travel blog's earnings ceased, and both Affilimate and its customers suffered. She chose ConvertKit because it did not require her to learn how to create and format an eBook. All she required was an intuitive interface for creating her email course. She gained over 1,000 subscribers in less than two weeks, confirming she was on the right track with her specialization.
What Features to Look for While Selecting the Service?
Selecting the best email tool for your smallbusiness requires some research. Because what works for one firm in terms of mass email distribution may not necessarily work for others. It might be overwhelming if you are unsure of what to search for.
Here are the top features to look for when choosing an email marketing service for your small business:
Excellent deliverability-made email designs
Analytics and reporting
Landing page builders
If you work in sales, email is the third most powerful source of information for B2B audiences, trailing only personal workplace relationships and industry thought leaders' recommendations.
Email Marketing Is Still a Strong Marketing Base
According to Statista, the global email marketing industry was worth $7.5 billion in 2020 and is expected to reach $17.9 billion by 2027. Similarly, 4 billion people use email on a daily basis. According to the same source, this figure will rise to 4.6 billion by 2025.
By looking at the above statistics, the tried and tested method of email marketing will continue to offer a lot in 2022 and beyond. In addition, email marketing continues to outperform other forms of internet marketing in terms of return on investment.
64% of small businesses communicate with clients via email. (HubSpot)
31% of B2B marketers believe email newsletters are the most effective strategy to nurture leads. (HubSpot)
Email marketing is still the most direct communication channel to internet users today, and it is also the most effective. It has the potential to increase your sales, enhance your brand image, and increase consumer engagement, among other things. The importance of email marketing for small businesses should be self-evident.
So, the best email marketing service for your small business certainly depends on your business needs. This article has identified and covered the top ones. Email lets the item speak for themselves. You can implement the above mentioned top email marketing services to reap the benefits of email power.
What are the best services for high-volume email marketing?
Some of the top email marketing services for small businesses are:
What is the future of email marketing?
According to Statista, by 2023 it is estimated that there will be 4.3 billion email subscribers worldwide. This implies that the email marketing should have personalization, email triggers, segmentation, and database management tools. Thus, securing the future of email marketing for small businesses.
How effective is email marketing?
Email marketing outperforms social media by 40 times. Email marketing may boost revenue, get new customers, and keep existing ones.