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5 Mistakes When Spending On Your Business

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A new coffee maker for the break room, new company car or educational courses seem like practical purchases for your business. But do you really need them? When you’re operating on a small budget, spending on things like these can be disastrous for your business. Let’s take a look at common spending mistakes entrepreneurs make that lead them to financial mishaps. If you’re facing economic difficulties, stay away from these business spending mistakes.

1. Buying To Impress

The thought of buying new electronics, furniture and marketing products to impress your clients and investors sounds appealing to many businessmen. But don’t just open your checkbook yet. Spending to impress is a bad idea because you’re not in business to impress other people. You’re in business to make a profit. Spending is an expense to your business. Instead of spending to impress, spend money to make more money. You don’t need the latest electronics or new furniture. If you need to buy new equipment, get the essentials and make money with that. When you are truly profitable, then you can move up in bling.

2. Spending on Untargeted Marketing

Spending a lot of money on general advertising is not efficient and effective. Untargeted marketing is expensive because it does not bring in the most number of potential clients. For example, spending money on a billboard might make it seem like you’re being visible. However, you are also visible to a lot of irrelevant people. Instead of spending on general untargeted marketing, focus on targeted marketing platforms like Google AdWords and Facebook because they can bring in clients who are more likely to buy your product or service. They are also more cost-effective compared to general advertising like newspapers and billboards.

3. Attending Expensive Conferences

Conferences can give you the opportunity not only to learn what’s new in the industry but also to network and hobnob with people who can be beneficial to your organization. However, it is easy to be overly enthusiastic and go overboard. The trick is not to attend every conference and seminar. It’s better to choose your events wisely by defining your networking purpose before attending an event. Instead of paying for expensive conferences, talk to industry leaders. Take them out to lunch or coffee and soak up what they have to say and learn as much as you can. This is a one-on-one opportunity you seldom get when you’re in a conference.

4. Spending on Cheap Products and Service

One of the best ways to increase profit margins and keeping costs low is by looking for the cheapest available materials or service. However, this plan can also backfire on you especially if the product or service is low quality. In fact, you can end up spending more. For example, you find 2 products that will speed up your manufacturing process greatly. Product A costs less than Product B so you are naturally tempted to buy Product A. However, you fail to recognize that Product B is a trusted brand, is made with high quality materials and comes with a warranty which means it can probably last longer. If you buy Product A, you might end up buying a new one after a couple of years and end up paying the same amount. In this case, Product A ended up costing you more money. When it comes to cheap, make sure that it is made with quality materials and not the cheapest price tag.

5. Not Keeping A Record Of Your Expenses

If you don’t keep track of how much you spend, you’re not controlling cash. Not keeping track of spending is one of the most common business mistakes novice entrepreneurs commit. It’s true that running a business takes a lot of time and many businessmen don’t have the time to record all their business expenses. But keeping track is important and should be something you do every day. If you can’t do it every single day, set aside a specific day of the week to track your expenses for that time period. When you control your cash flow you know where you are spending your money and can come up with ideas how to minimize expenses. Segregating expenses by department can make the chore easier for you.

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Business

Home Office Safety Tips

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Here’s some home office safety tips. In today’s digital world more and more companies are allowing their employees to work from home. The employees can increase their productivity when they do not need to commute daily. The only requirement is an internet connection. However, there come some security issues with this freedom and flexibility. You need to create a safe home office environment to reap the benefits of telecommuting.

Security of sensitive data (Home Office Safety)

Cyber security is a big concern for the business houses as more and more people are electing the ‘work from home’ option for freedom and flexibility. It is vital to work from a secured Wi-Fi connection to keep all the sensitive data away from the prying eyes. The companies provide VPN access to its employees, but if someone hacks the home Wi-fi connection or public hotspot, your data could be compromised. Make sure you secure your sensitive data to have proper home office safety.

So, you need to be extra cautious about other devices connected to your wi-fi. You should also invest in a robust anti-virus software. Do not let your family members use your work laptop. You should always follow the company policy of accessing the company network remotely. Your computer should have up-to-date operating systems, antivirus software and regular scanning programs. You should take extra care about storing office files and backup. The storing location should be approved and accessible by your company.

Workstation safety

Many organizations ask their employees to read and sign a telework agreement. These agreements clearly mention the home safely checklist. People who want to telecommute must have a separate and secure workstation. The work area should be peaceful and quiet. Your desk height and chair should be proper. You cannot work for longer periods if your table and chair are not comfortable. Your back should be adequately supported. Floors should be dry and free of hazards. You must also keep a first aid kit at your workplace. To avoid fire hazards, there should be more than one exit. You should keep a fire extinguisher too. The workspace should be free of clutter and trash. You should keep your work devices far from flammable items. Your office furniture and equipment should be ergonomically correct. Your table should have enough space for computer, printer, document holder, and phone.

Electrical safety

In recent years, computer-related accidents and falls have increased quite a bit. Experts suggest placing the computer or any other work devices away from the edges of desks. You need to organize and secure the open wires to avoid tripping over them. You should install safety covers on unused electrical outlets. You should keep your computer equipment connected to a surge protector. You should not keep any damaged or exposed wiring. Avoid use of extension cords. Keep the electrical plugs and panels in good condition.

The employer often overlooks the health and safety issues of a telecommuter. The teleworkers should have a proper understanding of the hazards of working alone at home. There should be a safety surveillance program to check the ‘work-at-home’ arrangement. Monitoring the safety of every telecommuter is difficult for the company, but they can provide proper safety guidelines to every teleworker. The employees can do self-inspections and send in regular reports to the company HR department.

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Business

Customer Satisfaction Should Be Your Number One Priority

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No matter what your product or service is, without customers you don’t have a business. This is because customers are the backbone of any business. In fact, customers are so important many businesses have adopted a “customer is always right” policy. Many companies strive to keep their clients happy. However, there are businesses that do not know why customers are important. Here are reasons why your customers should be your number one priority.

No Business

Let’s say that your product is so cool it solves many problems. This is very good but without customers to patronize it, you have no business. Customers are important because without them, your company does not need to exist. Businesses exist to provide products and services to customers. In the entrepreneur world, businesses exist to provide products and service that customers consume. Prioritizing customers will let you learn what they want so that the cycle is unbroken.

Helps You Improve

Customers are important not only because they consume your goods and services, but also because they help you improve. By listening to their feedback, you will learn what can make your product/service better. Many companies spend millions of dollars on R&D but there is no better source than the people who patronize your product. By listening to your customer’s feedback regularly, you can improve and tweak your product so that it gets better each time.

More Customers

Loyal customers are the best brand ambassadors for your products. If they really like your product, they will tell their friends about it. This is good news for businesses because it is free advertising and because it will bring in more customers. Having loyal customers rave about your product to other people is a good way to measure success. By listening to what they want, you are establishing a relationship with your customers. Prioritizing their feedback will gain their trust and they in turn will recommend you to other people.

Quality Feedback

Customers are also the best source of quality feedback. Remember that they are the ones who are using your products on a regular basis. Prioritizing customers means that you are engaging them. You will have good sources for feedback which allows you to analyze quality information. Following this strategy will let your company analyze and respond better to make your products or services improve which could help boost sales.

Make You Rich

When consumers are happy they consume more of your products which can make you rich. How? Customers like to buy from a brand they trust. They are happy to use a product that is of good quality and will recommend your product so that their friends are happy thereby expanding your customer base. The more people that buy from you, the more potential for profit. Most of the time, more profit means more money inside your pocket.

Ensuring that customers are happy and are prioritized is a good marketing plan. Making them number one is a good way to make your business successful. Prioritizing them could start a chain reaction that can propel your business forward.

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Business

Business Insurance And Why You Need It

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Business insurance is a requirement that you should not ignore even if you are in a low-risk workplace. For certain business sectors such as healthcare industries, mechanical workshops or amusement parks, getting a liability insurance is essential. Finding the best insurance can be a challenging and complicated process, but it is better to get an insurance coverage. Disasters happen, and you need an authorized protection to save you from severe economic loss.

Why is business insurance necessary?

If you start a business and employ some people, you need to have business insurance. It is a legal requirement. The insurance coverage varies from one country to another. Almost all countries have made it compulsory for the companies to get a liability insurance. You may think that your business is small and has less risk. You can also think that you can afford the losses your companies might face. The business experts always advise getting a proper insurance for every kind of business. There can be natural disasters like floods or earthquakes. Fire accidents and thefts are not the only risks. Your business can incur massive losses due to disruption of work. There can be cash crunch, skilled labor crisis, road work, police barricades and criminal acts too. You should consider all the aspects before buying an insurance coverage for your company.

General Liability Insurance

Almost all trades have some liabilities. So, a general liability insurance is essential. Before you hire some employees for your business, get a liability insurance first. Your company becomes the ‘employer.’ It becomes a legal need if you wish to make your business a limited company. If any of your staff falls ill or faces any fatal accident during working hours, your company becomes liable. You need to discuss with your insurance broker about the amount of liability insurance cover your business needs. If there is any death because of their work in your company, you need to arrange appropriate compensation. So, you should avoid any expense trimming while buying insurance for the company.

Professional Liability Insurance

It is also known as errors & omissions (E&O) insurance. This is not a one-size-fits-all insurance. Each industry has different concerns while running the business. So, you need customized coverage for your business. The professional liability insurance protects the business from the claims that the company was negligent in performing their services accurately. When you buy the E&O insurance, make sure you appoint an attorney for your company who can defend the lawsuits filed against the company.

Property Insurance

Property Insurance is a must when you run a business. Be it your own building or leased property, you need coverage. This insurance covers your business inventory, equipment, signage, and furniture from any losses due to fire, storm or burglary. Home based businesses still do not get much coverage from property insurance. You need to ask your insurer for extra coverage.

Product insurance

Apart from the above-mentioned insurance policies, you should get an additional product insurance to cover your manufacturing business. It covers any loss due to manufacturing, distributing and retailing hitches.

Buying insurance for your business is complex. You need a trustworthy insurer. Every business needs a unique package based on the requirements of the company. You should always review your insurance policies and keep them in active status.

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