Useful Tips & Info

Understanding your customer spending

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The latest data by McKinsey & Company shows that Kiwis still feel the economic effects of the pandemic and are cautious about spending, despite retail spending bouncing back sharply when the country got out of lockdown.

Acknowledging the general cost-consciousness, at BGS, we’ve advised our clients to repackage their products to make it easier for customers to purchase. At the moment, people are still hesitant to commit long-term so instead of offering month-long subscriptions, repackage your product for one-off offers – this is one example of using available data to shape your marketing strategy.

As smaller businesses, tracking your targets’ behaviour and sentiments is critical – those that can adapt will thrive in this quickly-changing market.

keat ngUnderstanding your customer spending
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How to Get a Great Night’s Sleep with Good Cash Management?

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Cash is probably the number one cause of stress, worry, and anxiety for smaller business owners, which is natural when cash dictates the success or failure of any smaller business. Studies by the ANZ bank shows that up to 82% of small businesses fail because of cashflow problems. Some smaller business owners focus on budgets, which is essential, but it is only half the picture the other half is a clear projection of your cash flow. Managing your cash flow gives you a useful estimate of where your business will stand from a liquidity point of view into the future.

The ability to analyze your profit and loss statement, identify trends, and interpret what these tell you about your business is important. And you need to put that information into a useable form with a good cash flow forecast.

We teach some of these critical financial tactics in our Forecasting Your Business Webinar. And it comes with a free forecasting template that you can use for your business!

Relieve your mind from the anxieties of the unknown, fly by the seat of your pants style business management and join us here.

Why is it important to manage your cashflow efficiently?

It helps you prepare. The goal of cash flow management is to foresee upcoming financial difficulties. Identifying when finances are going to be tight will allow you to plan where and how to allocate your

keat ngHow to Get a Great Night’s Sleep with Good Cash Management?
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Success: Solid Plan, Leadership, Action & Accountability

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There is no straightforward path to success. Let me just put that out there right away. It is a winding road, and most of the times you don’t see where you are heading. In my years of being a smaller business consultant helping many small businesses grow, I have lived by an effective formula for success. Success is a total of four things: a solid plan, leadership, action, and accountability.

A Solid Plan

A solid plan is the structure of any successful business. To come up with a solid plan, you need to look through every detail and imagine every possible scenario that may happen to your smaller business. And come up with measures for each! It helps to be knowledgeable about the five aspects of a business. 

A solid plan helps in making your business flexible and resilient to changes. By looking at all the details, you get to create clear and tangible goals. You know what’s your plan of attack to achieve these goals. And with clear direction, it’s easier for your employees to see the importance of achieving these goals. 

The takeaway here is to be ready for the future – creating a solid plan is preparing your small business for success.

 

“By failing to prepare, you prepare to fail”. – Benjamin Franklin

 

Leadership

As a smaller business owner, you are the master of your ship. Everything starts with you. The way your business is running is a reflection of your leadership skills. 

A good leader is collaborative. Communication is open. There’s always a steady flow of honest feedback and ideas between you and your employees. An open communication facilitates mutual understanding and ensures that you’re in the same boat. This way, employees know how they are supporting the business and how vital their roles are. 

Open communication fosters a culture of shared trust which develops accountability and excellent performance. 

Effective leaders know The team’s real motivation. Why do we want to do what we do? It also requires you to be mindful of your strengths and weaknesses. Doing so will help you hire a well-rounded group of people. 

Action

You can only achieve your desired outcome when you commit to act on your plan. Taking action relies on discipline and being effective. All of this is a level of honesty with self, if you look yourself in your heart of hearts you will  

Self-discipline is a product of being prepared. When we create routine and productive habits, it gives us direction and prepares us for the predictable and unexpected. For example, if you have a habit of self-check-in in the morning and evaluation at the end of the day, it helps give your day structure. Having a direction for your day gives you a clear picture of how things will go and when you can address unexpected roadblocks. A clear direction and general sense of preparedness prevent procrastination.

Self-efficacy, on the other hand, is influenced by self-discipline and mentality; Self-discipline to stick to your course of action and belief in your capacity for success. Focus on approaching challenges as something you can master. Be aware of your capacity yet recognize the things that you can improve on. Acknowledging that you can always learn something new opens you to more opportunities to succeed. 

Accountability

Accountability is following through with your commitments. It’s the difference between achieving your goals and just dreaming about them until you die. What can I do? How can I make things better? Thus accountability allows you to produce higher quality results and boosts productivity as well. 

As a leader, the culture of accountability in your business starts with you. Following through with commitments shows reliability and fosters trust. When leaders trust their employees, the employees want to live up to this trust. As a leader, you have to demand accountability from your employees. You set clear expectations, make sure that there’s a mutual understanding of these expectations, active follow-through, and support in achieving these commitments. 

In my experience, most smaller business owners (humans) need someone who keeps them taking the actions they need take to achieve success. The bulk of what I do as a consultant is to make business owners accountable. Joining mastermind groups is a powerful option for this. You will be making and sharing plans with your group and reporting back on your progress, this way, you will not be tempted to defer taking action and jump back into reacting to your business. 

Success boils down to consistent and committed action on your goals. It’s about recognizing your strengths and weaknesses, asking help when it’s needed, and realizing that you can never succeed alone. 

Kevin SatoSuccess: Solid Plan, Leadership, Action & Accountability
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Managing Your Finances During Crisis

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The economic climate has certainly changed and the uncertainty on how long this pandemic will have made many smaller business owners worried about surviving. At this point, it is crucial to know your financial position, forecast its movement, and plan for any possible scenario. We might not be able to predict what exactly is to come, but we can most certainly prepare for it. At this time revenue will be low and payments are slow. How much will it cost you to stay open? How long can you sustain if you close? The goal here is to come up with a forecast for the most likely outcomes. 

What are the financial moves that you can make?

Analyze your Profit and Loss statement. You need to have a clear idea of where you stand financially in your business. Forecasting will help you figure out the movement in your position and what you can do about it.

Reduce your costs. Now is the best time to analyze your expenses and identify necessity from luxury in your business.“Is that software needed for me to run my day to day business, and with decreased activity? If you want to cut down on expenses, you must stick to the essentials. 

Review your debts and obligations. Inquiries on your capacity to settle your debts will be more frequent now. Identify your financial position. Don’t be afraid to reach out for possible renegotiation. Ask your bank for interest-only repayments or negotiate with your landlord for workable payment terms. Pay within your cash inflow. Also take advantage of any tax breaks the government is offering, even if you don’t need them right now, you don’t know how long this might last.

Find new sources of revenue and protect your cash flow. Adapting to the changes in the business economy is necessary to survive. I have written this article on how to find your new niche in this economy. It tells you how and where to pivot your business in this challenging time. As much as you want to focus on keeping your costs to a minimum, it is necessary to keep your cash flow, well, flowing. A balance of cash inflow and outflow is essential. Engage in new payment options. Ensure you are at the front of the line for all grants, subsidies and assistance the government may offer, and apply even if you don’t need it right now, you can always pay it back if you don’t use it. 

Take care of your clients. More than ever, now is the time to build loyalty among your clients. Offer deals that work beneficially for both of you. Having loyal clients ensure future income for you.

Lastly, learn from other business owners and experts who have done it before. Learn from those who have been there before you: have conversations with players inside and outside your industry or read articles written by real, successful business owners. Mastermind groups offer insights into effective business practices that you can apply to your smaller business. 

With all the economic uncertainty, the goal here is to understand your financial position and prepare your business for foreseeable outcomes. And you don’t have to face this challenge alone. Having grown our business 30% per year in the Global Financial Crisis we can show you how to make the best of a bad situation. 

Kevin SatoManaging Your Finances During Crisis
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3 Things You Should Consider when Pivoting your Business

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The disruption of business has forced companies to reevaluate and made pivoting some businesses necessary to survive. Don’t be scared! It might be the opportunity you have been waiting for to transform your business.

When pivoting your business, there are three aspects of the business model to consider: value proposition, value network, and target customers.

The value proposition is the value that your product provides

  • Fulfil needs and create solutions. During a crisis, the needs of people change. It is then crucial to spot these unmet needs and to address them. A clear idea of the business’s strengths and recognition of the industry’s weaknesses is empirical. 
  • Use existing assets to create new value. Streamline assets to create new value that is not traditionally offered by the company, but is in high demand. An example is housekeeping services specializing in sanitation. 

Value Network is how you deliver the value of your product.

  • Find new ways to deliver your value. The rise in popularity of platforms like Zoom and Google Classrooms is because of this. As people are encouraged to quarantine, businesses that traditionally meet face to face with their customers have gone online instead. 
  • Connect and collaborate. Collaborate with players in the industry to create a new value that is only achievable when working together. 
  • Re-purpose assets. Re-imagine existing assets to produce new products. An example of this is how a liquor manufacturer can shift from producing liquor to producing disinfectants and sanitizers now.
  • Find novel ways to get paid. Explore different payment modes and terms

Target Customers are the people who benefit from your product

  • Find new clients. Explore a different demographic of target customers 
  • Collaborate with businesses in the target locale. Collaborate with other businesses to create a product. An example is when a trucking service collaborates with produce suppliers to create a mobile grocery. 

Pivoting your business is all about finding the right aspect to pivot from and coming up with the most logical, tangible, yet unconventional idea. Its focus is on saving the business or allowing the transition to a new business model while using existing assets. A dynamic and evolving approach is ideal. 

 

 

 

Kevin Sato3 Things You Should Consider when Pivoting your Business
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Marketing Spend: How to Attract More People with Less Money

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With the pandemic affecting economics globally, is it worth marketing at this time, is it wise to spend on marketing right now? Truthfully, yes. But it requires a different approach; this is when strategic marketing is most important. Strategic marketing, in a nutshell, is coming up with a plan that focuses on long-term goals and executing an effective strategy to reach these goals. Strategic marketing is a focused and very targeted marketing activity, that attracts more of the people you want for less advertising spend. How do you do this?

Focus on the long-term goals and remember the heart of your brand. While your customers’ needs are the forefront in what guides you to set your goals, the core values of your brand keep you true to your business identity. Long-term goals can be the growth of your business, experimenting on a diverse demographic, or even the creation of an additional business or value proposition. Focusing on these long-term goals requires you to do marketing in a very strategic way, the customers you target have a significant impact on the direction of your business in the long term. 

Understand your customer’s demographics and behaviour. Knowing your target market guides you in determining your customers’ needs. In turn, you align your goals with catering to these needs. Fulfilling the needs of your customers as your goal will then become your marketing strategy.

Look for opportunities. Recognizing the possibilities in your industry and using these opportunities to your advantage is a reliable way to stay relevant. Filling these gaps shows your benefits; this sets you apart from your competitors and adds value to your customers

The essence of strategic marketing is coming up and executing a well-defined plan. Tactics are the actions that take you towards achieving long-term goals for your business. It’s having an awareness of industry trends and setting yourself apart from your competitors by highlighting the value you provide to your customers and therefore attracting more of them. 

I have been consulting one on one in strategic business management for the last 6 years and have spent over 25 years in various smaller businesses myself. Since lockdown, I have been applying my own technology to my company Business Growth Stratagem Ltd and we re-modelled our businesses and created a whole new value proposition.

Kevin SatoMarketing Spend: How to Attract More People with Less Money
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