Evolution in the financial sector is happening at an unprecedented rate. Consumer behavior and how we manage our money are changing, shaped by technological advancement and access to information. Collaboration for fintech companies is key to success in this rapidly changing landscape.

In the past, traditional financial institutions (FIs) have been the primary financial services providers. However, with the rise of digital-first companies and the ubiquity of mobile devices, a new generation of financial technology companies has emerged to provide innovative solutions to customers. Let’s look at how to monitor competitors and some of the reasons why collaboration, not competition, is key for fintech companies.

What Is Fintech?

Fintech is a broad term that encompasses any company that uses technology to provide financial services. This can include everything from mobile payments and money transfers to investment management and personal finance.

While fintech companies are often startups, they can also be divisions of larger tech companies or traditional FIs. There has been a surge in fintech companies in recent years as consumers become more comfortable trusting technology with their money.

However, while fintech offers a lot of potential for innovation and customer service, it’s important to remember that these companies are still subject to the same regulations as traditional FIs. This means they need to partner with established financial institutions to provide their services.

Collaboration vs. Competition

What Is Collaboration?

In the context of business, collaboration often refers to partnering with other companies to create a new product or service.

There are many benefits of collaboration for Fintech companies. It allows companies to pool their resources and knowledge to create something greater than the sum of its parts.

What Is Competition?

In the business world, competition refers to companies fighting for market share. This can take the form of advertising wars, price wars, or simply trying to outdo each other in customer service.

While competition can be healthy for business, it can also lead to a race to the bottom in terms of prices and quality.

Understanding how these concepts apply to the world of fintech is key to understanding why collaboration is so important.

Why Collaboration Is the New Fintech Model

The old competition model between fintech companies and traditional financial institutions is no longer sustainable. For fintech companies to succeed, they need to partner with established FIs. This brings Fintech from disruption to collaboration.

There are a few reasons for this shift:

Regulations

While fintech companies are often lauded for their innovation, they are still subject to the same regulations as traditional financial institutions. This means that they need to partner with an established FI to provide certain services.

For example, fintech collaboration with banks requires a partner with a licensed bank or credit union to offer banking services. This allows them to offer their customers the same services without obtaining a banking license themselves.

Access to Customers

Another reason fintech companies need to partner with traditional financial institutions is access to customers. FIs already have established relationships with their customers, which gives fintech companies a foot in the door.

Traditional FIs have local branches and ATM networks that fintech companies can leverage to reach new customers. This is especially important for fintech companies that are just starting. They are also getting involved in local business events and have established relationships with other businesses in the community.

Resources

Finally, fintech companies need to partner with traditional financial institutions because they have access to resources that startups don’t. This includes everything from capital to experienced employees.

For example, when a fintech company partners with an FI, it can tap into the FI’s customer base and distribution channels. This allows them to scale their business much faster than they could on their own.

Types Of Fintech Partnerships

There are a few different types of fintech partnerships:

Equity Partnerships

In an equity partnership, the fintech company and FI take equity stakes in each other. This type of partnership is often used to fund joint ventures or new products.

Debt Partnerships

In a debt partnership, the fintech company and FI provide loans to each other. This type of partnership is often used to finance joint ventures or new products.

Revenue-Sharing Partnerships

In a revenue-sharing partnership, the fintech company and FI share the revenue from joint ventures or new products. This type of partnership is often used to fund marketing initiatives or expansion plans.

Benefits Of Collaborating With Fintechs

Collaboration between fintech companies and traditional financial institutions offers several benefits:

Increased Innovation

When fintech companies partner with traditional financial institutions, they can bring their innovative products and services to a larger customer base. This increased exposure can help to drive the adoption of new technologies.

Relationship Building

Another benefit of collaborating with fintech companies is that it allows traditional financial institutions to discover how your relationships today can create opportunities for tomorrow. This can help FIs stay ahead of the curve and better serve their customers.

Improved Customer Service

Fintech companies often have customer service teams dedicated to providing an excellent experience. This can help to improve the overall customer service of the financial institution.

Increased Efficiency

Fintech companies often have cutting-edge technology that can help increase the efficiency of traditional financial institutions. This can free up employees to focus on other tasks, such as providing better customer service.

Improved Risk Management

Fintech companies often have sophisticated risk management systems in place. This can help to protect the financial institution from potential losses. Collaboration with a fintech company can help improve the financial institution’s risk management.

What are Examples Of Fintech Companies?

There are many different types of fintech companies, but some of the most common include:

Payment Processing Companies

Payment processing companies provide the infrastructure that allows businesses to accept payments. Some examples of payment processing companies include Stripe, Square, and PayPal.

Lending Platforms

Lending platforms connect borrowers with lenders. Some examples of lending platforms include Prosper, LendingClub, and Funding Circle.

Investment Management Platforms

Investment management platforms provide tools and services to help investors manage their portfolios. Some examples of investment management platforms include Wealthfront, Betterment, and Personal Capital.

Financial Planning Services

Financial planning services provide advice and guidance to help people make financial decisions. Some examples of financial planning services include Mint, Wealthfront, and LearnVest.

Conclusion

Collaborative partnerships between fintech companies and traditional financial institutions can offer many benefits, including increased innovation, improved customer service, increased efficiency, and improved risk management. These partnerships can help both parties better serve their customers and stay ahead of the curve.

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Female leaders bring skills, expertise, and relationship-building skills that elevate company culture. Every professional is different, but women will lead differently than men through ethics, respect, and compassion.

Why We Need Female Leaders in Business

There are several reasons why we need female leaders, including:

• Women value balance between work and life – many women business leaders balance family duties, kids, and extracurriculars, in addition to their regular workday. Therefore, women leaders will know how to prioritize initiatives, multi-task, and favor work-life balance.
• Women leaders show empathy – empathy is critical for building and maintaining relationships in business. Women leaders will be skilled at understanding employees and then implementing change to boost morale and productivity.
• Women have strong critical thinking skills – women leaders assess and address crises effectively. Organizational growth and change will demand a level head, where women leaders thrive.
• Women are excellent written and verbal communicators – leaders must communicate well with all personality types and employees. Effective communication will also ensure that cross-functional teams and stakeholders are on the same page.

Women business owners possess powerful traits that allow them to excel in leadership roles. They have what it takes to weather a company through a storm, but they also know how to communicate and empathize with others. A women leader who values balance will also create a strong workplace culture that retains its employees for the long run.

Factors and Challenges Affecting Female Leadership

So, what are the main challenges for women business owners? In the last half-century, female professionals have made impressive strides in the corporate world. Even when the conditions were tough, several women advanced to leadership roles. However, there are still several factors affecting female leadership, including:

• Sexism – inequal work environments, sexual harassment, and subtler comments involving sexism
• Stereotyping and gender bias – because women are less assertive on average (considered weaknesses of female leaders), employers might lean more toward men for leadership opportunities because of their aggressive, strong, and direct demeanor.
• Weaker leadership networks – because men historically dominated the workplace, they might have more established leadership networks. Women do not enjoy this same access, which could delay their quest for future leadership positions.
• Responsibilities with the family – professional women will typically share a big portion of household activities, including caring for family members. Balancing these traditional responsibilities with leadership aspirations can be challenging.

Leadership Tips for Women Business Owners

There are millions of women business owners who overcome these challenges and excel as meaningful business leaders. There is no universal path for rising the ranks. However, below are five strong behaviors and tips for women to rise as leaders in business.

Find a Mentor

Mentors and business coaches are essential because they guide you through unfamiliar territory. A true mentor has walked in your shoes before. Because mentors gain skills and experience, they can provide advice for female leaders. You might not follow the same path as a mentor, but your journeys should be filled with similar obstacles.

A mentor can be someone you meet with regularly. You can update them on your leadership journey and seek feedback in times of need. A mentor is someone you can trust with all your hesitations, fears, and successes. They should be a reliable resource for you as you navigate through the corporate ranks.

Join Networking Groups

Networking groups are an effective tool for expanding your relationships. These groups meet every week, month, or quarter to engage with each other and share value. The people you meet here are like-minded individuals who want to maximize their careers. You will learn skills from others, but you could also make connections that eventually turn into future leadership opportunities.

Ask for Feedback

If you look to advance at a current company, seeking feedback can be critical. You might have a viewpoint or self-assessment of your leadership capabilities. But how do other people see you? Asking meaningful questions can uncover valuable things to improve upon.

Seek feedback from people you engage with regularly. This feedback could come from direct reports, cross-functional stakeholders, or people in upper leadership. Being a better leader for other people will allow you to rise through the ranks quicker.

Display Confidence

Showcasing confidence in yourself is something that every leader needs. Every interaction is a chance to strengthen your brand. displaying this confidence in yourself can happen during presentations, performance reviews, and everyday conversations. Your confidence should instill a belief in people that good things happen when you are around. confidence is also infectious and will elevate the company culture.

Learn How to Delegate

One of the essential steps in female leadership development is through delegating. The best leaders know what they are great at, but they also know the areas in which they struggle. Knowing who in the organization can assist with your weaknesses will be critical. Identify the strengths and capabilities of your team members, and then assign them projects that will help them grow.

Advice for Female Leaders from Successful Female Entrepreneurs in 2022

Some of the best mentors in your life might be people you have never met. Studying the behavior and words of established leaders is also another effective tool for growth. Below are some inspirational quotes and advice for female entrepreneurs.

• “Whatever it is that you think you want to do, and whatever it is that you think stands between you and that, stop making excuses. You can do anything.” (Katia Beauchamp, Co-Founder, and CEO of Birchbox)
• As a leader, it’s a major responsibility on your shoulders to practice the behavior you want others to follow.” (Himanshi Bhatia, Founder, and CEO of Rose International)
• “The difference between successful people and others is how long they spend time feeling sorry for themselves.” (Barbara Corcoran, Real Estate Mogul and Investor from the television show “Shark Tank”)
• “Surround yourself with a trusted and loyal team. It makes all the difference.” (Alison Pincus, co-founder of One Kings Lane)
• “Leadership is the ability to guide others without force into a direction or decision that leaves them feeling empowered and accomplished.” (Lisa Cash Hanson, CEO of Snuggwugg)

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Client relationships are the key to long-term success in any business, and they take time to build.

Developing and maintaining client relationships requires constant attention to stay on top of potential opportunities and ensure that you provide excellent service at all times.

Most of your sales will come from repeat customers and referrals, so it’s essential to ensure you’re doing everything possible to foster these relationships. This article outlines how to develop and maintain client relationships for business success.

Why Is It Important To Build Relationships With Clients?

Customer relation refers to a relationship between a company and its customers. The company may be a retailer, wholesaler, service provider, or manufacturer. Enlightened businesses know how to utilize customer relations management (CRM) effectively.

CRM is a process of managing customer relationships to build customer loyalty. It can be used by businesses of all sizes, from small local shops to large multinational corporations.

CRM aims at maximizing customer satisfaction through improved communication, increased understanding of customers’ needs, and better personalization of products and services.

In addition, building and maintaining client relationships should be a top priority because it offers recurring revenue, high satisfaction levels, and positive referrals.

Best Practices for Client Relationship Management

To make sure that your business thrives, you need to take care of your existing clients and get new ones on board. Here are seven tips that will help you develop and maintain client relationships.

Prioritize Communication

If you want your clients to stay happy with your services, communicate often. Your communication can take many forms, such as:

• Email newsletters
• In-app Messaging
• Personal phone calls

Whatever medium you choose, keep in touch regularly. In addition to keeping your client base informed about what’s going on with their account, regular communication will help them feel like they’re an essential part of your business.

Make sure that each interaction is beneficial for both parties involved. You don’t want to spam your clients with too much information. Instead, send out valuable tips or newsworthy updates that they might find interesting.

The more helpful info you provide, the more likely your client will continue using your services.

Share Knowledge

Develop a unique knowledge base that helps make you more marketable. Your client should understand your area of expertise and how it can benefit them specifically.

It’s up to you to help them see how your services can solve their problems or give them opportunities they wouldn’t have otherwise had access to.

When you pitch a new project or service to a client, they already know what to expect from you. Your portfolio acts as an excellent resource for people who are unfamiliar with your work.

If a portfolio isn’t available, consider writing an ebook about a particular topic relevant to your business and offering it as a free download on your website.

Create Accountability

To develop meaningful relationships with clients, create a sense of accountability. The more active their involvement with your services, the stronger their commitment.

Set expectations early in your relationship to know what you do, how you do it, and when they can expect results. Then make sure you deliver on those promises.

Your business relationship will grow as both parties see positive results from working together. Accountability builds trust, which is essential for any long-term relationship.

Even if something goes wrong or doesn’t work out, it’s an opportunity for growth and learning to strengthen future client relationships.

Personalize Client Relationships

You want to treat each client as an individual. The key to client loyalty is understanding your clients’ needs, business goals, and unique culture.

Try following up after meetings with emails that reinforce some of what was discussed or writing notes of gratitude on how much you value their business. Simple gestures such as birthday cards will also do the trick.

Clients will always appreciate it when you take an interest in them as individuals rather than just another customer or source of income for your business.

Maintain a Positive Attitude

One of the best ways to keep your clients happy is by maintaining a positive attitude. Seeing yourself as optimistic, conscientious, and able to take charge makes you more likely to succeed in business. So make sure you always focus on maintaining a positive outlook, even in challenges.

When you are upbeat with clients, it goes a long way in building rapport and maintaining that valuable relationship. It will show clients how much you believe in yourself, and it will provide them with peace of mind that they’re doing business with someone they can trust.

Use Project Delivery Tools

Any service-based business needs to have a great project management tool in place. To achieve consistent success with clients, you must have a way of keeping everyone informed, on task, and accountable.

Project management tools are fantastic for making data-driven decisions in every part of your services.

Tracking tasks in real-time ensures that no one falls behind or forgets about a specific piece of work. They also provide file sharing, time tracking, invoicing, expense tracking, and reporting. As long as all parties know what they’re responsible for, it will be easier to maintain client relationships.

Pay Attention to Feedback

If you develop a good connection with your clients, they’ll be more than happy to give you helpful feedback on how you could improve your services. Review sites are also great places to read what other people think about specific businesses.

Keep an eye out for client-specific complaints or praise, and use that information to help better tailor your products or services for future customers.

Take advantage of plenty of online forums where business owners can share their experiences and advice. Responding to reviews is a great way to show potential clients that you care about customer experience.

Final Thoughts

Relationship building takes time, commitment, and consistency. To maintain any relationship, you need to focus on your target client, offer them value, be responsive, and keep an open mind. Establishing relationships with clients is a two-way street that requires both parties to work hard to make it last.

How do you maintain your business relationships? Share with me on social using #businessrelationships. Twitter, Facebook, LinkedIn, or Instagram

Negotiation is a necessity for any successful business transaction.

Sometimes, the negotiations shape formal affairs with clear objectives. Other times, negotiation in business is a continuous process that develops to suit parties’ business goals.

Strong negotiation skills are essential if you are looking for success as a small or large business. Let us go through the top five secret tips professionals use for a successful negotiation.

Importance of Negotiation for Your Business

Negotiation can elevate your stand on the success ladder, and it’s also an art. Negotiating allows amplification of the value of your work as a business.

However, it does not benefit a single business or person. The negotiation agreements on any cause address important matters or find solutions to long-standing problems. Successful negotiation can help create relationships today for opportunities tomorrow.

What Are the Basic Business Negotiating Strategies?

Before you step into a business transaction, developing reliable negotiation skills is critical. The first offer you receive is often not acceptable. But committing to a robust negotiation process can make the terms sweeter while taking care of your business’s bottom line.

Here are four basic negotiating strategies you should consider.

Aim for a Win-Win Situation

All sides of the bargaining table should leave feeling like they have a win. To achieve this, view your work as a problem-solving role.

Start by asking yourself what the negotiating partners want that you both can have. Next, propose a deal that addresses the needs of both sides for a better outcome.

Set Offer Expiration Date

Give the negotiating partner a deadline to accept or walk away from your reasonable offer. However, the other person may come back with a counteroffer.

But an expiration date will force the other parties to be serious. As a result, this strategy is one of the most effective ones that skilled negotiators use in various stages of negotiation.

Open Negotiations With Lowball or Highball Offers

As the buyer, you know what you can pay, so start by offering half of the amount. The seller will not accept the offer, but you’ve established a baseline for more negotiation.

This strategy can help you realize a lower price than starting with a more reasonable offer. The strategy also works for sellers. Open with a higher selling price than what you want to accept.

Have a Best Alternative to a Negotiated Agreement (BATNA)

When all sides hold on to their positions, getting a yes can be impossible. A BATNA helps establish rules for what occurs in case there’s no agreement.

For example, think of a worker who demands a raise and a boss who refuses. A BATNA resolution may call for the worker to continue working for six months at the current rate, and they can leave.

The BATNA features more trade-offs than a successful business negotiation, but it contains concessions for both sides. In our case, the worker gets six months to search for a better-paying position while the employer has six months to find a replacement.

Do’s and Don’ts of Negotiation

Its critical business owners become students of the negotiation strategy. You should pay close attention to these do’s and don’ts passed down by experienced entrepreneurs:

• Do set goals
• Do define your thresholds
• Do follow negotiation etiquette
• Don’t lose your cool in emotional negotiations
• Don’t be intimidated and instead require the other party to support their claims with quantifiable data
• Don’t avoid conflict

Top 5 Secret Tips for Successful Negotiation

Negotiation is a must-have skill in the modern business world. You will benefit from learning a few tips successful negotiators use. These five secrets are the key to conducting successful business negotiations.

Build a Strong Personal Relationship

You’ll likely not believe a stranger who comes to you with a proposal that will make you 30k in a month. But what if your best friend comes with the same proposal?

Positive relationships engage comfortable feelings, including trust. Whether you have a personal or corporate relationship, the positive relationship influences how others believe you. For example, people are more accepting when someone they believe comes with a proposal.

Have a Contingency Plan

Things may not work as you want, so do a what-if analysis for contingency planning. All you do is gather thoughts on the likely outcomes and create responses for each situation. A contingency plan also reduces the number of surprises you encounter during negotiation.

Talk Less, Listen and Analyze More

Listening or talking more can affect a successful negotiation in business. However, consider finding a balance between the two. The most effective strategy is to spend 30% talking and 70% listening.

Active listening lets you concentrate on what’s being said and find opportunities. However, always analyze the facts for better-informed decisions.

Don’t Hurry

Things will not work in your favor in most situations. So don’t panic and hurry to shut down the discussion. Instead, remember there is a tomorrow, and things can turn upside down.

Be Realistic About Your Needs and Wants

Your “needs” are essential goals you should achieve. “Wants” are goals that aren’t so essential for your business.

Distinguishing both goal types will help you during negotiation. While you can compromise on your business “wants,” you can’t do the same with the “needs.”

Bad Negotiation Examples: Mistakes to Avoid

Now that you know the secrets to successful business negotiation, here are six common negotiation mistakes to avoid:

• Failing to prepare
• Not knowing your BATNA
• Assuming something is non-negotiable
• Focusing on price
• Trying to be the “winner”
• Being afraid to offend

Successful Business Negotiation Examples

Now that you have the skills to negotiate, put them to work and do what’s best for your business in these negotiable scenarios beyond your customers:

• Negotiating salary-Over 70% of managers expect salary and benefits negotiations when making an offer to a candidate.
• Lower your bills-If you’re looking to boost your online presence, remember that your internet bills are not set in stone. Negotiate your monthly internet bill and get extra change in the bank account.
• Decrease your rent-Landlords use various factors to set commercial rent, such as the current market price, supply and demand, and property market value. Each factor fluctuates, allowing you to negotiate on rent.

Practice to Get Better at Negotiating

Now that you have the tools to become a master negotiator, it’s important to mention that building the perfect negotiating strategies will not happen overnight.

These tips work best with constant practice. The key is finding your unique negotiation style, and don’t get discouraged if you fail at first-it’s part of the learning curve!

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Expansion and growth are what businesses expect, but when the time comes, most are unprepared. It’s prevalent for small businesses that find success to run into scaling issues, and because of this, they find substantial setbacks and profit losses.

When faced with expansions, businesses begin to double their production at insane costs by buying more equipment and resources, hiring more workers, and expanding beyond necessity. If you want to learn how to scale a business, these tips will help ensure that your business doesn’t falter during times of growth.

What is Scaling in Business?

You may be asking yourself, why bother scaling up a business? Scaling a business means setting a foundation for your business to grow as you continue operation. It’s vital to keep margins as favorable as possible for your business to continue generating revenue.

When people hear the word scale, they associate it with expansion or growth. It’s important to note that a scaling strategy is different from a business growth strategy. While there are similarities when discussing scaling in business, people usually refer to scaling as the ease of accommodating demand during periods of hyper-growth.

A business accomplishes this by increasing its output with little effort and cost. When a company can meet demand and has scalability, growth comes naturally, and businesses can accommodate and capitalize on new customers.

Why You Need to Scale Up Your Business

Staying agile in an ever-changing world is how businesses continue to thrive. It’s vital to understand that more customers will be interested in your product as time goes by. When this happens, you’ll see a demand for your product above your original starting point.

For example, pretend that growing an online clothing business is your overall goal. As your clothing business becomes popular, you’re getting more orders than you typically get. Your business starts to experience material shortages, delays, and a backlog of unhappy customers waiting for their orders.

In this theoretical example, having a scaling strategy becomes crucial to ensure sales continue at a steady rate. Without a plan, expenses may become too much, and orders backlog. If a customer has to wait for an extended period, it’ll reflect poorly on your online clothing business.

Business Scaling Strategy: How to Scale Your Business in 2022

If you are wondering how to scale a business online or at one of your physical locations, here are five tips to help you grow your business.

Prepare for Growth Before it Happens

Scaling a business ensures that growth happens with minimal disruption and cost. The best way to accomplish this is by preparing early. A general scaling strategy allows your business to keep up with demand and growth.

Find points in your operation that would be expensive or difficult to scale if demand grows. These points will be your main focus during your early stages of business. If increasing production becomes necessary, look for alternative methods or cheaper alternatives to maintain the same input but increase your output.

Automate

Automated processes will prove crucial to your business regarding scalability. Cutting time from marketing email campaigns, online advertising, and invoices frees up employee time to focus on higher priorities.

A good scaling model allows you to continue operation as is, regardless of the size of your business. Automating these processes as your business grows ensures efficient use of time since humans won’t have to send out even more emails or invoices manually.

Technological Investments

Businesses need to acquire any competitive advantage they can. Using technology and keeping it up to date is a sure way to ensure that your business has some semblance of scalability during times of growth.

Technology is critical in scalability because tasks requiring human intervention are limited to time and energy and are subject to errors. If needed, technology can output more than a human and do so globally.

Perfect examples of technology that improve your business’s scalability are accounting, HR, inventory, and marketing software. Having computers and easily upgraded software are great ways to keep up with demand.

Cloud Services

Using cloud services allows you to skip paying for technology upgrades as high-end machines are also available via cloud services. Digital storage also no longer becomes an issue as your business can continue to expand its storage without worrying about physical hard drives and servers.

Outsource

Small businesses will find it easier to outsource expertise or equipment to meet customers’ growing demands. When necessary, outsourcing saves you money and buys your business time to improve your operation to meet the growing demand while not sacrificing anything waiting for upgrades and internal changes.

Fundamental Optimizations

Businesses scale to meet demand. So, you’ll find massive losses if there is no demand for your product or service. It’s important to remember that steps have to occur before proper scaling can happen.

The typical solution when forced growth happens is to try and downscale again to a smaller-sized operation. From that minor operation, you’ll begin to find growth again.

Optimizations such as product or service quality improvement, resource distribution, and getting more out of raw material will improve your output and, in turn, increase your scalability.

Biggest Challenges in Scaling a Business

You’ll find that some of the biggest challenges in scaling a business is that not all companies have a scaling business model. Businesses, such as consultancies that deliver specific expertise, are challenging to scale up.

Being unable to replicate or mass produce a process or service is why scaling a business is hard. Sometimes a business scaling strategy is simple and very effective. For example, you write a book and mass produce that product to sell. Books have natural scalability. It’s a product or resources with natural scalability as it indefinitely meets demand.

Generally, scalability becomes a challenge if your business revolves around providing a service to someone, and a human must provide it. It’s not to say that it’s impossible, but the benefits of scaling a business don’t come easily to some service businesses.

Scaling Business Examples

Now that you know how to scale a business, it’s important to be aware of how it can be done right.

Google is a perfect example of a business that scales appropriately. Google can actively service more customers without increasing their resource usage as much. There are a few reasons that Google can scale better than most businesses, mainly because of its focus on technology.

Google utilizes technology to its full extent to ensure costs stay low, but the number of people they can service will increase. The Google search engine, YouTube, and their telecommunications companies are all services that allow a dedicated team to serve millions without outrageous costs.

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Networking is connecting with other people, usually for professional reasons. It’s often seen as a necessary evil by many people, but the truth is that networking can be an excellent tool to help you achieve your business goals.

There are countless benefits to networking, such as:

• Gaining exposure for your business
• Meeting new potential customers or clients
• Developing new business relationships
• Learning from other companies in your industry
• Finding new suppliers or vendors

An excellent way to start networking is by attending local business events or joining a business networking group. You can also connect with other businesses online through social media or professional networking sites, like LinkedIn.

The Best Tools for Better Networking

There are various tools that make networking easier and more approachable. Here are some of the most notable tools.

• Social media: Use social media to connect with other businesses in your industry or local area. LinkedIn is an excellent platform for business networking.
• Events: Attend local business events to meet potential customers, clients, or suppliers.
• Business networking groups: Joining a business networking group can help you develop new business relationships.
• Professional networking sites: LinkedIn is an excellent professional networking site that can help you connect with other businesses in your industry.

If you want to build a better network, there are a few things you should keep in mind:

• Be genuine: When you’re networking, be sincere and authentic. People will remember you and do business with you if they feel like they know and trust you.
• Be prepared: When you’re meeting someone new, have an elevator pitch ready to give them an overview of your business. You should also be prepared for any questions they may have about your business.
• Follow up: After you meet someone new, follow up with them. Send people an email or connect with them on social media.

What Does Good Networking Mean?

Networking is vital for all businesses. It can help you find new customers, secure funding, and grow your business. But what does good networking mean?

Making connections is only part of the equation – you also need to nurture those relationships. Gathering intelligence is also essential to better understand your market and what your competition is doing.

Good networking means:

• Creating a solid network of connections
• Nurturing relationships with your connections
• Gathering intelligence about your industry and competition
• Applying what you’ve learned to better your business
• Offering value to your connections
• Asking for help when you need it

Building a better network can help you achieve your business goals. By following these tips, you can start networking like a pro.

7 Better Networking Tips

These tips can help you build a better network and be more prepared for networking opportunities:

Define Your Goals

Before you start networking, it’s essential to know what you want to achieve. For example, do you want to find new customers? Grow your business? Secure funding? Once you know your goals, you can target the right people and groups.

Let people know why you’re interested in connecting with them. If you’re looking for a job, be upfront about it. People are more likely to help you if they know what you’re trying to achieve.

Get Involved in Your Industry

One of the most effective networking methods is to get involved in your industry. Attend trade shows and conferences, join industry organizations, and participate in online forums. This involvement will help you meet people interested in what you do and who can help you achieve your goals.

Build Relationships

The importance of networking is all about relationships. When you meet someone, take the time to get to know them. Find out what they do and what their interests are. The better you know someone, the more likely they will help you out when you need it.

A mutual friend or colleague can also be a great way to introduce yourself to someone new. If you have a mutual contact, ask them to introduce you. This introduction will make it more likely that the person will want to meet with you.

Be Helpful

If you want people to help you, you need to be willing to help them. When you see an opportunity to help someone, take it. Doing this could mean introducing them to someone you know, giving them advice, or simply offering a listening ear.

This assistance displays a lack of ego and builds trust, which is essential in networking. People are more likely to want to help you if they know you’re the kind of person willing to help others.

Follow Up

After meeting someone, be sure to follow up. Send an email, connect with people on social media, or invite them to coffee. Keeping in touch will help you stay top of mind and make them more likely to think of you when they need something.

Letting a person know how their advice helped you is also a great way to stay in touch and build a relationship.

Offer Value

When you’re networking, always think about what you can offer others. This offer could be your expertise, connections, or simply your time. If you can provide value to someone, they’ll be more likely to want to help you in return.

Being authentic can also go a long way. People are more likely to trust and help someone genuine and not just trying to sell them something.

Be Patient

Building a solid network takes time and effort. Don’t expect results overnight. Instead, focus on making genuine connections and providing value to others. Over time, you’ll develop a solid network of eager people to help you achieve your goals.

Conclusion

Networking is vital for the success of your business. It helps you find new customers, grow your business, and secure funding. But networking isn’t easy – it takes time and effort to learn how to build a strong network.

It is worth it, though. You can start networking like a pro by following these tips and achieving your business goals.

How does your business network? Share with me on social  Twitter, Facebook, LinkedIn, or Instagram.

There are few singular success stories in business where only one person or company was able to gain success without any help whatsoever. Collaboration is behind winning deals and designs, fueling future accomplishments.

The benefits of collaboration are myriad. Examples of business collaboration include how writers, graphic designers, and photographers collaborate on an advertising campaign and how manufacturers work with suppliers to develop new products.

This business-to-business collaboration often brings success that no one partner business would have achieved independently.

Here we examine the benefits of collaboration and cooperation, and answer the question “What is collaboration in business?” and discuss its importance.

Types of Business Collaboration

Among the types of business, collaborations are these examples of cooperation that result in reaching goals together.

Product Development

Often manufacturers and the companies that provide their parts and materials will collaborate on developing a new product. Suppliers then can make the parts needed for the new product, which is an advantage for both companies.

Supply Chain

Reliability in a company’s supply chain is essential. One business may not have the strength to bargain, but businesses working together can secure better pricing and continuity of supplies. Businesses working together can act in the interests of all involved, including their customers.

Outsourcing

Many businesses profit from partnering with specialists to outsource essential business functions. An example of business-to-business collaboration in outsourcing could include a company partnering with a call center firm to provide customer service rather than setting up and staffing a call center of their own.

Businesses will also partner with marketing and advertising firms rather than developing marketing and advertising departments of their own, which provides better results and minimizes the costs of staffing those departments.

Creative Collaboration

When businesses produce advertising campaigns, websites, or publications, they will often collaborate with writers, photographers, and graphic designers who work on contract. This creative cooperation makes publishing possible. The independent contractors may decide to collaborate on other projects in the future.

5 Benefits of Collaboration and Cooperation

Collaboration’s benefits can be profitable for businesses and their company cultures. These benefits include:

Boosts Employee Engagement

Engaged employees are focused on benefiting their team and the company. Employee engagement boosts productivity and customer satisfaction and lowers turnover rates. Collaboration that gives employees a change from their routine leads employees to be more engaged in the business’ mission.

Increases Skills and Knowledge

Collaboration with other businesses can increase the skills your employees have and will boost their understanding of the production process. As collaborative teams work together, team members learn from each other.

Builds Virtual Teams

The trend toward virtual teams – those that work from different locations and communicate remotely – was rising before 2020 and shows no sign of slowing. Collaboration and cooperation among teams whose members are in other locations or time zones can build camaraderie.

Speeds Production

Time is a valuable resource for businesses. Speed in the development and production of new products ensures a new product arrives to market at the best time for profitability. Collaboration through systems where information and documents are shared reduces wasted time and resources.

Instead of one business working to solve a problem, multiple companies can address it for the benefit of all.

Adds to Employee Wellness

Employees who collaborate and feel a sense of camaraderie have higher feelings of peace and well-being, increasing employee health and making good employees more likely to stay with a company. In contrast, competition can leave employees feeling negative feelings of stress and anxiety.

Advantages and Disadvantages of Collaboration between Businesses

Collaboration among businesses has plenty of pros and a few drawbacks that one should consider before moving toward collaboration.

Advantages

The pros of collaboration and cooperation in business include these advantages for greater efficiency and profitability.

Larger Network

Businesses that collaborate and cooperate find that their networks grow larger. Entrepreneurs and small companies benefit from expanding their contacts and building a more extensive network.

Saves Time

Problems can be solved faster by collaboration than through competition. Collaboration among professionals solves problems quicker and speeds up production and supply chains. In addition, the sharing of ideas and information clears the way for progress toward project completion.

Fuels Innovation

Development of new products and technologies is encouraged through collaboration since cooperation among employees can inspire new ways of thinking. Often new ideas are sparked by the thoughts of others.

Disadvantages

Collaboration isn’t always easy, and there can be disadvantages to a collaborative working arrangement. Here are a few considerations.

Conflicts in Working Style

When people from different companies and organizations come together, differences in working styles can create conflicts. An unsuccessful collaboration full of conflict can result in companies being less likely to cooperate in the future.

Groupthink

A danger when collaborative groups are at work is leaning into groupthink. When this happens, the predominant opinion of the group reigns while opposing thought is ignored or overruled, which is a problem when the opinion of most of the group is wrong.

Distance Difficulties

If your business collaborates across time zones and oceans, you may have difficulties organizing meetings.

For example, an 8 a.m. meeting in the central time zone of the United States would be a 6 a.m. meeting for team members on the west coast. When scheduling video meetings, keep this in mind and choose times that work for everyone.

Proprietary Information

Companies might be concerned about sharing information about new products with other businesses. They may also worry that their employees might leave for other companies. Non-disclosure agreements will protect proprietary information, allowing innovation to occur without worry.

Business Collaboration

By this time, you know the answer to “What is collaboration and why is it important?” and understand that, through collaboration, all stakeholders should benefit. Business cooperation will result in greater efficiency, increased innovation and productivity, and happier, healthier employees.

While collaboration does have disadvantages to consider, the advantages outnumber them by far. Companies and employees have far more to gain through collaboration than they have to lose.

How do you collaborate? Share with me on social! Twitter, Facebook, LinkedIn, or Instagram.

Cash flow refers to money put into a business and sent out. Cash flow is essentially the movement of funds. When a business receives money, they want to spend it on optimizing its cash flow better. Optimization of cash flow comes from actively making income from these avenues.

What Increases and Decreases Cash Flow in a Small Business?

Do you know how to increase cash flow in a company? Cash flow does not refer to just profits. It’s tied to excess funds and expenses. When net income decreases, so does cash flow.

Businesses must first pay their liabilities and expenses such as debt, employees, and administration costs. The excess wealth left can improve the business by investing in better equipment to speed up production, generate more revenue through new projects, or put into a savings account to generate interest and be used for emergencies.

Knowing your finances will help you with the ins and outs of the financials of your business.

How to Monitor Cash Flow in a Business

The best way to monitor cash flow is by using 3rd party financial services or using the systems and features banks have for you. Checking your balance sheet is a sure way of knowing what affects your cash flow has on your business.

Why Increase Cash Flow for Your Small Business

Increasing cash flow is vital for your business because having idle money is not a good thing. You’re essentially losing even more money when cash isn’t moving and just sitting around. Even putting your money in a savings account is good because it generates interest over time.

Money generates more money. Money sitting in a checking account acts as idle cash until a transaction. Remember that the best ways to improve cash flow in a business use your money to its fullest potential.

Tips on How to Increase Cash Flow for Your Small Business

Small businesses should understand how to improve cash flow and optimize it properly.

Adjust Prices of Goods and Services Offered

Typical cash flow management practices in small businesses involve price changing. Prices must increase as demand rises and materials for products become expensive. Price increasing is essential, but doing it wrong will leave your business in a worse state.

If your business is still offering the same amount for a product even though now that product costs more to make, you’re effectively losing money. Consumers are typically aware that extra expenses pass onto them as the cost of making things increases.

Lease and Software

Equipment is costly. Initial costs for purchases such as equipment are massive, and software and software upgrades add up. If your business can save costs by leasing equipment, you may be in a favorable spot.

Leasing equipment and software allows your business to receive upgrades for no additional start-up costs.

Digital and Automated Invoices

The use of digital invoices has become popular for multiple reasons. Your business receives payments faster than traditional methods, and the consumer is aware of their cost promptly. The consumer being aware of their total costs is important because it helps them plan and adjust for payment properly.

Having digital invoices also allows the business to track revenue with little to no error properly.

Use Idle Money

A fundamental concept in business is that you have to spend money to make money. Idle cash isn’t generating any revenue, but it does have the potential to multiply. Ensuring you invest your business’s excess income is the best way a small business can grow and increase cash flow.

Accounting Software

There are hidden secrets in small business bookkeeping that are a sure way to save money and increase cash flow. Paying an accountant is always a viable option, but accounting software allows even the most amateur business owners to understand how to manage their funds properly.

Accounting software enables you to track all of your business’s finances straight from your computer and phone. Most accounting software also tracks invoices, employee payments, and savings.

Outsource Talent

Outsourcing allows your business to save costs on R&D, new equipment, and other added expenses when dealing with a project that requires resources you don’t have.

Communication barriers and other problems can arise, but outsourcing is a fantastic way to constantly keep your options open to tackle new projects and make more money.

Business Line of Credit

Having a business line of credit will prove valuable on many fronts, primarily emergencies, and cover expenses for the months. Small businesses have volatile income, so there may be times when they need to draw upon a different fountain of cash while waiting for payment from unpaid invoices.

Having a business line of credit is similar to any form of credit as it acts as a constant source of adjustable cash.

An alternative to a business line of credit would be a merchant cash advance, but how does a  merchant cash advance work? Basically, a merchant cash advance allows a business to quickly access additional funds via a loan.

Sweep Account

Banks will typically offer a service to automatically transfer income from your business checking account into a business saving account. An added benefit to sweep accounts is that the bank will automatically transfer money to cover the costs if your checking account dips below a threshold.

Refinance Business Loans

Small businesses typically suffer by paying higher interest rates on small business loans. As they become an established business, they open up lower interest rate loans because they now have more credibility. If you have certain business loans with a high-interest rate, it may be good to refinance those loans.

Best Cash Flow Management Practices in Small Business

Cash flow practices will typically involve improved awareness of where your money is going and why it’s going there. Common practice is to keep track of money by having a close relationship with your finances.

Tracking your money and seeing how much you’re generating through your excess cash is one of the best cash flow management practices. Small businesses have the opportunity to be closer with their money and use it wisely.

Share which method is your favorite to increase cash flow by using #9CashFlowMethods on Twitter, Facebook, LinkedIn, or Instagram.

Managing profit margins when you own a business is crucial to success. It aids you in making decisions that improve the company and lets you adapt to client needs more quickly. You become a leader that is proactive and makes decisions based on facts.

A lot of information about profit refers to net profit. Net profit is the difference between all expenses and revenue. In some industries, knowing gross profit is more pertinent. Either way, knowing the difference is essential.

What Is Gross Profit?

Gross profit is the amount of revenue after removing the cost of the goods. The amount subtracted is sometimes called COGS or the cost of goods sold. Gross profit is sometimes called gross income.

Calculations use no other expenses to determine gross profit. Only the actual cost of the goods or service is used. For example, if you sell 100 widgets at a roadside stand for $10 each, you will receive a total of $1,000. If it cost you $5 each to get the widgets, you paid $500. $1,000 – $500 = $500. Your gross profit is $500.

Gross Profit vs. Net Profit

Both types of profit subtract the cost of the actual product. Net profit removes operation costs, including salaries, rent or lease, utilities, and taxes. Net profit is a more precise assessment of company increase. Gross profit is often a suitable calculation.

To continue the example above, suppose you pay someone to man the booth $10 an hour. Also, suppose you rent the booth for $20 a day. If it takes an 8-hour day to sell 100 widgets, subtract $80 for salary and $20 for rent. Your net profit is $400.

Gross Profit Formula in Balance Sheet

The basic gross profit formula is:

Total revenue – the cost of goods sold = gross profit

You can add this to a separate line in your balance sheet. Compile the revenue and costs separately, then subtract.

Gross Profit Formula Excel

If you are working on Microsoft Excel, follow these steps to insert the formulas and get your results.

1. Add product costs
2. Add total revenue
3. Subtract costs from revenue

The formula looks like this:

=SUM(TR-PC)

Replace TR with the address of the cell containing the total revenue, such as B2. Replace PC with the address of the cell containing the product costs, such as C2.

How to Calculate Total Gross Profit

The first step in calculating total gross profit is to add up total revenue. Add together all sales and earnings from products or services for the chosen time frame.

Next, determine your cost for creating the good or service. The cost includes such things as ingredients or parts, wholesale costs, and supplies.

Subtract the costs from the revenue. The result is your gross profit. How to calculate gross profit from balance sheets is the formula above.

What Is Your Gross Profit Margin?

A company’s gross profit margin is a metric analysis of sales. It is the gross profit percentage of total sales after the cost of goods sold but before other expenses.

Companies that calculate their gross profit margin regularly see patterns. If the numbers fluctuate wildly, the company should investigate to determine why. There may be a problem with the product or with the management. When a company has made major changes, it can expect fluctuations.

The average gross profit margin in retail businesses worldwide is about 52%.

How to Calculate Gross Profit Margin

The formula for gross profit margin is:

Gross profit / total revenue = gross profit margin

When you divide the gross profit by the total revenue, it provides a decimal. Convert this to a percentage and that is the gross profit margin. The larger the percentage, the more efficient the business.

Tips to Increase Gross Profit

There are many ways in which you can boost your gross profit.

Price and Value

Add value in effective ways to raise prices. For ideas on what to add, ask clients. Those who buy from you will have ideas to offer.

Change things so price competition is unnecessary. Make it so people want to buy from your company. Stand above the others. Price is not the only thing to consider in a product. Improve brand value.

Focus

Alter your focus. Expand the scope of the company. If the product or service has less common uses, promote them along with the usual information.

Automation

Automate what you can. Especially when the business offers a service, automation can cut costs.

Inventory

Avoid markdowns. Manage inventory and make sure people can see what is available. Control purchases to limit excess. Reduce delivery costs, if possible.

Cross-selling

Cross-sell and upsell to increase average order value. Current customers are already purchasing from you and are more likely to be willing to add more. A section with add-ons or “people also buy” will encourage larger purchases.

Waste Reduction

Recognize where waste occurs in the process and find ways to drop the excess. Don’t build up too much inventory.

Discounts

Don’t just cut prices. Make offers personalized. Some customers will buy at a smaller discount than others.

Efficiency

Encourage efficiency and improved production from your staff. Set goals, train your team, and develop good characteristics in your employees. Streamline operations to reduce expenses.

Vendors

Negotiate with your vendors. Landing a discount on what you use to create the product or service will increase the margin. Improve relationships with them. Adjusting costs and making the process more efficient will help both of you.

Promotion

Promote the products that bring in a higher margin. Then if someone is uncomfortable with it, offer the lower profit alternatives.

Use methods to cost-effectively promote products and services. Possibilities include the internet and social media.

Tiers

Try a tiered pricing system. Offer a basic and a premium. Many consumers prefer a premium version.

Bottom Line

The gross profit formula of revenue minus cost of goods sums up a company’s financial health. Remember that costs like buying the product and directly related costs are subtracted. Costs like loan payments, rent, and taxes are not.

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Is buying a business a good idea? There is no simple answer, but buying a business can either be a wise choice or a disaster depending on the industry. Buying a business comes with its risk, but typically the significant barrier of entry risk is lowered because of the preexisting establishment.

The start-up costs of a business come with time and money. It takes time to start a business and a significant amount of money for equipment, inventory, and employees. It’s not uncommon for start-ups to not see a return on their investment for the first few months or years of operation.

When buying a business, that worry is out the window. Typically, the original business owner has already completed the burden of marketing, branding, and establishing a working strategy for the business.

It may sound too good to be true, and it might just be. Depending on what business you buy and whom you buy from, there may be things that weren’t disclosed beforehand and may leave you in a position that isn’t favorable.

How to Buy an Existing Business

Buying an existing business is as simple as finding a seller, sitting down and working out the agreements, and then committing to the purchase. The transfer process is very standard, along with the paperwork that comes with it.

Knowing what you’re buying before actually committing to it is very important. When purchasing an existing business, you should be more focused on researching the industry itself. We’ve made a checklist of what to consider when buying an existing business.

Buying an Existing Business Checklist

Knowing the business’s financial position: There is no reason to be surprised when a business isn’t turning a profit. It’s imperative to understand the business’s financial position before purchasing it. Ensure that the business has stable cash flows.

Knowing how much a business owes to who is important. Sometimes a seller will sell a business off because they know their business won’t be able to pay back all the debt they owe. Ensure this burden isn’t passed on to you, or if it is, make sure you know what kind of burden you’re taking on.

Knowing the location: Knowing why a business owner chose this location for their business is vital because that location defines multiple factors. Depending on the location, it could affect how the local community interacts or finds the business. The area also involves how many customers the business can reach and marketing options for those customers. Stay agile if you’re also finding yourself in a new environment when buying a business. It’s crucial to adapt and understand your new location quickly.

Why the owner is selling the business: The most crucial element on your checklist is understanding why the person is selling their business. Common reasons are moving on to start a new business or wanting to retire.

You should be looking for the red flags that are “too good to be true signs.” Unfortunately, even an honest salesperson will exclude the truth. Not mentioning problems in a business unless people ask is a common tactic used to ensure a buyer. This philosophy is that if the person cared enough, they should have asked.

What Is Generally a Good Deal on Buying an Existing Business?

The natural question most people ask is, “How much money do I need to buy an existing business?” and honestly, it all depends on the industry. Generally, the more established and secure business, the more money you’ll pay.

Regardless of the amount, it’s always wise to look at your financial options. For example, you may want a small business loan.

Buying an Existing Business Example

An example of buying an existing business may be trying to purchase a food stall. The cost of that food stall may be significantly less to buy than, let’s say, a car company like Tesla.

You can consider it an excellent deal if you buy a positively established, up-to-date business with all equipment and no outstanding balances.

Essentially, a good deal when purchasing a business may change depending on multiple factors. Still, at the same time, if the business you’re looking to buy has taken care of all the complicated start-up costs and is turning a consistent profit, then you’re looking at an excellent deal.

What Are the Pros and Cons of Buying an Existing Business to an Entrepreneur

Advantages

Reduced start-up is the most appealing reason for entrepreneurs to buy an existing business, but what are the actual cost reductions from buying a start-up? It ranges to far more than we can list, but in general, the big cost-saver is the basic infrastructure of the business. For example, if you’re buying a property management company.

Having the infrastructure and foundation of a business will eliminate the majority of the hassle and research involved with something like property management.

• Buildings
• Equipment
• Inventory
• Employees
• Customers
• Cash flow

Something else to note that could be a significant advantage is the business’s brand. It may already have good standing with the community, and therefore little to no changes would need to be made to see profits.

Disadvantages

There are still inherent disadvantages of buying an existing business regardless of its ideal condition. Any change leaves people uneasy in one way or another, so it’s necessary to understand that there may be resistance to new management.

Change in management and ideals may not be linked to employees and can cause a significant problem with new decisions. People usually have to earn their leadership roles, and not everyone will trust new management, especially if changes aren’t to their liking.

Outdated Equipment

Another concern is outdated equipment. Without proper knowledge of the industry standard, you may have a big bill to upgrade. Unfortunately, not every piece of machinery in the business you buy may be up to date.

Luckily, with research and asking the right questions, you can determine if this will be an issue and plan accordingly. Bringing this cost to the original owner before buying it may also get you a better deal.

Taking on Any Financial Burden of the Past Business

Taking on a business also means taking on their financial situation. Remember, a company is a living entity typically separate from its owners, carrying its debt and value.

It’s essential to understand the financial position of the business you are purchasing, which means any outstanding debts it may owe to banks, loan providers, or customers. If the original owner fails to disclose some of these liabilities, you may take on more debt than you can handle.

Share any tips you may have when it comes to deciding to buying an existing business by using #ExistingBusiness on Twitter, Facebook, LinkedIn, or Instagram.