Business - Jayapal.Org

Trademark Valuation – 4 Best Practices Explained

A trademark is an intellectual property consisting of a recognizable sign, design or impression which can distinguish products or services of a particular provider from those of competitors.

Trademarks can be located on the package, label or product itself. They and their associated goodwill, can be important legal rights supporting brands. As such, a trademark valuation is required, similar to brand valuation.

A brand is a constituent element of any business and the registered trademark is considered as a commercial brand supporting the development of your business activity.

When it comes to trademark valuation, there are a few factors that need to be taken into consideration besides valuation methods:

The geographical sphere of your business activities (national, regional and international)
The marketing budget allocation for commercial development
The fame of your company or brand
The current and future modus operandi of your brand

Trademark valuation methods are extensive and here are 4 of the most common best practices:

1. Market Multiples Approach

This mainly deploys the study of companies in a similar industry to comparable business models with a similar size. Their financial and accounting data is collected. Trademark evaluation is based on identifying the most relevant company business models and comparing their business performance with your company, thereby calculating the relevant multiples and ratios.

By using this method, the data will help evaluators to establish the most relevant multiple linked to your trademark valuation by taking references into account such as revenue, gross margin, current income before taxes and net income etc. Additionally, analysis of the operating territories and brand’s positioning are also done to moderate these multiples.

2. Market Approach

This is based on market observation and actual trademark valuations of comparable brands through research or public accounting data. Hence specific market-related data is required. It is generally based on ratios enabling by estimating the value of the target brand according to brands or companies in the similar industry. A risk premium is then derived.

The data and ratios collected, are then compared and transposed to estimate the value of a brand, taking into account its specific characteristics – market, reputation, territory and activity. The size of competing companies is also taken into consideration.

3. Income Approach

Present value of future incremental cash flows attributable to the specific trademark valuation, needs to be determined by the evaluator. To determine this value, four factors are taken into consideration:

Strategic use of the trademark – product sales, licensing, enforcement, and/or for defensive purposes
Amount of the cash flows
Timing of the cash flows – when they start and when they end (remaining useful life)
Risks of the cash flows

The nature of the cash flows associated with a trademark typically includes the use of a trademark in the sale of one or more products.

4. Relief From Royalties Approach

The amount of royalties that a company would have to pay is being assessed based on a hypothetical licensing agreement just in case it did not own its brand. Other factors like industry, territory, reputation of the licensed brand and planned developments are also taken into account.

This method is based on actual commercial contracts or contracts in progress. Similar licenses in identical industries are also being analyzed for a more accurate conclusion so that the terms regarding the theoretical royalties that could be granted under a trademark license signed with comparable conditions, can be defined.

A theoretical average royalty rate is established over a certain period of time and the discounted royalty flow method is then applied. The value of the brand is thus determined on the basis of sum of future royalty flows net of discounted taxes, increased by the discounted residual trademark value.

In summary, the trademark valuation methods are diverse and many factors need to be taken into consideration when it comes to accurate valuation of a trademark. There is no “one size fits all” approach. Rather, it is the use of two to three methods of investigation and analysis to derive an accurate and conclusive value.

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March 26, 2021/by Editor

Business

Intellectual Property Valuation – 4 Best Practices

As technology continues to advance and drive global economy in the millennial age, many companies, especially the technology-based ones, are discovering that intellectual property (IP) occupies a lion’s share of their value. Examples of intellectual property are brands, patents, copyrights and manufacturing processes.

Guidelines and regulations regarding the valuation of intellectual property are also evolving worldwide due to different statutory laws in individual countries. The valuation of intellectual property involves assigning a monetary value to the intangible assets of a business entity. However, the intangible nature of intellectual property means it is often difficult to value and define, making it a challenge to put a fair price to the value.

IP valuation is a major issue especially in the area of mergers and acquisitions because a typical potential acquiree will claim to have accumulated a significant amount of intellectual property and wants to be paid for it. Hence reliable valuation is important for multinational corporations involved in IP transactions. Intellectual property valuation is also useful for deriving the value of collateral to be used in a lending situation.

Due to its intangible nature, it is not possible to assign an accurate value to intellectual property. Therefore many valuations methods are used to derive a range of possible valuations. The acquirer will then use the information to develop an initial offer price and a permissible range of increased prices that reasonably encompass the calculated value of the intellectual property.

These are 4 of the best practices in intellectual property valuation:

1. Income Method

This method focuses on the future cash flow derived from a particular piece of intellectual property. Accuracy of the projected forecast is very important and the following variables are taken into account when using the income method.

Income streams either from product sales or patent licensure
Estimate of duration of the patent’s useful life
Patent specific risk factors and incorporating those into the valuation
A discount rate as IP assets have their own risk of unique risk factors
Patent related factors – new patent issuance, challenges, infringement suits, trade secrets and cooperation treaties

2. Discounted Cash Flow Method

This method attempts to determine the IP value by computing the present value of cash flows from that particular piece of IP, over the economic life of the asset. As patents have a finite period of useful life, free cash flows are forecasted for the economic life of the patent and the discount rate is calculated by the time value of money and risk probability. The forecasted free cash flows should also be adjusted to increase a patent’s success.

3. Relief From Royalty Method

This method is based on deprival value theory and looks at the amount of income that a company would be deprived of if it did not own the intellectual property but rented it from a third party instead. The royalty represents the rental fee which would be paid to the licensor if this arrangement is in place.

The ability to determine an appropriate royalty fee is dependent on specific circumstances and requires the identification of suitable comparable transactions and prices involving third parties. A reliable sales forecast is required in order to derive an accurate estimate of income that comes from the intellectual property. An appropriate capital cost also needs to be determined to make this method a success.

4. Venture Capital Method

This method also derives a patent’s value from the cash flows that arise from the asset’s life. However, it differs slightly from the Discounted Cash Flow Method because a fixed non-market based discount rate is used. It is usually 50 percent or in the 40-60 range and there is no major adjustment to increase the probability of a patent’s success. Cash flows are assumed to be constant and independent risk factors are lumped together.

In summary, this list of intellectual property valuation methods is not exhaustive but it is advisable to employ two to three of them to derive a more accurate perspective and value so as to gain competitive advantage.

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March 13, 2021/by Editor

Business

Business Valuation Explained – 6 Best Practices

Business valuation is a general process of determining the current economic value of a company or an asset. It is used to determine the fair value of a business for many reasons which include sale value, taxation, establishing partner ownership and even divorce proceedings. There are a number of techniques for performing business valuation and owners will often engage professional business evaluators for an objective estimate value of the business.

Business valuation is usually conducted when a company is looking to sell a part or all of its operations or looking to merge with or acquire another company. There are many factors to take into account when it comes to business valuation – company management, capital structure, potential future earnings or the market value of its assets.

The tools for evaluation can vary among evaluators, businesses and industries. Business valuation is also important for tax reporting. Some tax-related events such as sale, purchase or gifting company shares will be taxed depending on business valuation.

There are many ways how a company can be valued and these are 6 of the best practices:

1. Market Capitalization

This is the simplest method of business valuation. It is calculated by multiplying the company’s share price by its total number of outstanding shares. Eg. As of February 2021, Company Z traded $70.55. With a total number of 5 billion outstanding shares, the company could be valued at $70.55 x 5 billion = $352.75 billion.

2. Earnings Multiplier

The earnings multiplier method may be used to get a more accurate picture of the real value of a company since a company’s profits are a better and more reliable indicator of its financial success than sales revenue is. It is also called the price-to-earnings ratio (P/E), comparing a company’s current share price to its pre-share earnings.

Future profits are adjusted against cash flow that could be invested at the current interest rate over the same period of time. In other words, it adjusts the current P/E ratio to account for current interest rates.

3. Times Revenue

This method defines a stream of revenues generated over a certain period of time and applied to a multiplier which is dependent on the industry and its economic environment. Eg. A tech company may be valued at 5x revenue while a service firm may be valued at 1x revenue.

Times Revenue method is especially popular with individuals who own small businesses. They use it when they want to determine the approximate value of their companies so they can ensure proper financial planning and preparation before selling the business.

4. Discounted Cash Flow

Similar to the earnings multiplier method, this method is based on future projections of cash flows which are adjusted to get the current market value of the company. The main difference between these two methods is that it takes inflation into account to calculate and derive the present value.

5. Book Value

This refers to a company’s equity value as reported in its financial statements. The book value is typically viewed in relation to the company’s stock value; it is determined by taking the total value of a company’s assets and subtracting any of its liabilities the company is still owing.

Book value also takes depreciation into account in the book value of assets. It attempts to match the book value with the actual value of the company. It is typically grown per share, determined by dividing all shareholder equity by the number of outstanding common stock shares.

6. Liquidation Value

This is defined as the estimated amount of money that could be received quickly through the sale of an asset or company. In short, the liquidation value refers to the worth of physical assets of a company as it steps out of business.

It only takes in the value of the tangible assets unlike selling off a business that also takes into account the intangible assets. It is commonly referred to the cash value of a single asset.

In summary, the list of business valuation methods is not exhaustive and it forms the central basis of informed decision making for companies, both in the present and in the future. The future is unpredictable and companies need to prepare for uncertainty at all times in the event of unforeseen circumstances.

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March 8, 2021/by Editor

Business

Startup Valuation – 6 Competitive Methods Explained

Business valuation is never straightforward and there is no “one size fits all” method. It is the analytical process of determining the current (or projected) worth of an asset or a company. There are many methods used for doing a valuation and this applies the same to startup valuation. In fact, it can be quite a tricky endeavour to perform startup valuation.

There are many factors to take into consideration like the management team, product demand, market trends and marketing risks involved. Here’s the bomb: even after evaluating everything with the most effective valuation formula, the best you can hope for is still an estimate.

Startup valuation methods are particularly important because they are applied to startup companies that are currently at pre-revenue stage and business owners will hope for a high valuation whereas investors will prefer a lower value that promises a higher return on investment (ROI). Unlike mature businesses, there are no financial records or steady stream of revenues to ease calculations of the startup valuation.

Venture capital firms and individual investors have dozens of methods to perform startup valuation with a range of easy and complex ones that involve several qualitative and quantitative variables.

These are 6 commonly used methods:

1. Venture Capital Method

This is a start up valuation that deploys a forecasted terminal value for the startup and an expected return from the investor, often stated as 10X, 8X and so on. It is to determine the pre-money and post-money valuations. The formula is as follows:

Pre-Money Valuation = Post-Money Valuation – Invested Capital

With the Post-Money Valuation being the terminal value divided between the expected return.

Eg. An investor values your startup at a terminal value of $2,000,000 and he wants a 20X return on his $20,000 investment so it will be $2,000,000 divided by 20X and that will give you $100,000 for the Post-Money valuation.

For Pre-Money Valuation, it will be $100,000 – $20,000 = $80,000

2. Cost To Duplicate Method

This method requires some due diligence as its main purpose is to determine how much it would cost to start the business from scratch. It is a very realistic approach that questions the competitive advantages of a startup.

If the cost of duplicating the startup is very low, then its value will be worth almost nothing. However, if it is costly and complex to replicate the startup business model, then the startup valuation will increase proportionately with the cost and complexity.

3. Berkus Method

A straightforward method that values startups based on five key aspects and giving each aspect a certain amount of money. The five qualitative aspects are sound idea, prototype, high quality management team, strategic relationships and product rollout or sales made $500,000 each.

For each aspect the startup possesses in full, the valuation should go up by $500,000. However, it depends on the extent in which each aspect is developed. The investor could possibly reduce the value of the item to $300,000 or $150,000, to determine the final value.

4. Discounted Cash Flow Method

This is a technical tool employed by financial analysts to determine the value of a business by estimating its future cash flows and discounting them at a certain discount rate to obtain their present value.

The sum of the discounted cash flows will be the determined amount for the startup valuation and given the fact that this method relies on assumptions with the performance of some historical data, it is not the most popular method used to do startup valuation.

5. Comparables Method

This method uses referential information and numbers from similar transactions to estimate the value of a startup. Eg. A similar app to the one developed by the startup was recently valued by a venture capital firm at $3,000,000 and the app had 100,000 active users.

This means that the company was valued at $30 per user. An investor could use this as a benchmark to value a startup with a similar app. The comparables method provides an observable value for the startup hence it is the most widely used approach as it is easy to calculate and always current.

6. Valuation By Multiples Method

This is usually used on startups that have already made some money and are showing profits. Eg. The startup is generating an EBITDA of $300,000. Depending on the industry the startup is in, competition, management team and some other qualitative aspects, an investor could tell you he is valuing your business at 5X, 10X or 15X the current EBITDA.

The EBITDA margins provide investors with a snapshot of the startup’s short term operational efficiency. As the margins ignore the impacts of non-operating factors such as taxes or intangible assets, the result is a more accurate reflection of the startup’s operating profitability hence this method is used by investors to quickly estimate the value of a more mature startup.

There are more methods but these are some of the most commonly used for startup valuation. There is no perfect method to value a business that is at the pre-revenue stage but it gives you an idea of what you could expect and ask for your startup. We hope this puts you in a better position when it comes to the funding stages.

March 1, 2021/by Editor

Business

Business Development Process Consultancy – 4 Great Reasons

Business development is a crucial part of any business. According to Oxford’s definition, it is the activity of pursuing strategic opportunities for a particular business or organization; by cultivating partnerships or other commercial relationships, or identifying new markets for its products or services. You may ask “How does consultancy help my business?”

For many firms, business development is just one of the many hats that a managing principal or business leader wears. In most cases, there is insufficient budget or need to hire a full-time business development manager.

This is where the experts come in – business development consultants who can help firms drive revenue. The main merit is that they can be hired on demand as and when needed so you only pay for their services when you need them. This adds to huge savings on in fringe benefits like medical, allowance and retirement benefits etc.

Sounds like a good deal? Let me break it down further for you so you know how to fully utilise the services of a business development consultant. Here are 4 great reasons why you should hire one to drive business revenue and add value to your business development process:

1. Access to expertise

Business development consultants are well educated, experienced and knowledgeable in business development consultancy expertise. Rather than manoeuvering in the dark about what to do next, you can trust their expertise to shed light on the current situation and come up with a sound business development plan.

This is what they were trained for so no matter which stage your business is at, they will know what are the appropriate next steps to do, doubling your time for driving business revenue.

2. Fine tune your business strategy

You need a sound and strategic business development plan to reach the desired goals for your business. Moreover, what worked in the past might not work for your business today because consumer behaviour is evolving at a rapid rate with advancing technology. Hence it is important to get an outside perspective into the business development process because everyone is susceptible to blind spots.

A good consultant can help you create a plan that combines what worked in the past with current consumer behaviour to maximize the effectiveness of your business development process so that limited resources can be used wisely and in the most productive manner.

3. Align technology with processes

Although there are more affordable business development software now, the usage is at an all-time high. Many CRM and marketing software companies like HubSpot offer free versions with amazing features. As you scale your business, you can upgrade to paid versions to match your business needs so you can automate most of the business development processes.

However, you need to have processes first before you can manage them and this is how a business development consultant can help you, making sure that the processes are practical, sound and easily understandable so any newbies in onboarding will have no problems implementing them too.

Some core processes include:

Identify your target consumer and demand channels
Create consistent sales processes for each channel
Use technology to automate most of your processes and for tracking real time growth

Set up SMART goals and dashboards to evaluate progress and tweak necessary adjustments to reflect market realities.

4. Help you discover your market focus

One of the most common but yet fundamentally important recommendations is that consultants help you narrow your business development focus aka discovering your market focus.

Like many new businesses, you chase after any opportunity that comes your way or whatever seems to be trending now; not thinking that your business might not have the domain expertise for that.

Eg. Your business might be in the law industry but your specialty is in criminal law. Instead of taking all types of cases which are also related to family and civil law, why not just focus on your specialty which is criminal law?

Market focus is increasingly important as consumers look for specialists instead of generalists because they want to be sure they are paying for the best quality and service. Likewise, you not only need to be an experienced lawyer, you also need to be an expert in the relevant fields to be potentially hired by clients to win family or civil cases.

In summary, we hope it gives you a better idea and inspiration on fine tuning your business development process. With the help of a business development consultant and well planned execution, you are on the way to seeing amazing business revenue.

January 18, 2021/by Editor

Business

Company Incorporation in Singapore – 3 Important Steps

Company incorporation aka setting up a company in Singapore is easy and hassle free. Singapore is consistently ranked as one of the best places in the world for doing business.

In one of Business Insider’s articles, it was stated that Singapore not only has business-friendly laws and flexible immigration policy, it also dominated the list for its simplicity for business tax filing. Moreover, the government offers tax exemptions to startups and has a number of schemes to help them in their initial entrepreneurship journey.

The Accounting & Corporate Regulatory Authority (ACRA) acts as the Company Registrar. It supervises the company incorporation process in Singapore. It is as per the Companies Act, Chapter 50. All compliance requirements must be met in order to set up a company successfully in Singapore.

Local and foreign business owners benefit by employing a registered filing agent to set up a business in Singapore. This rings true for many foreigners wanting to start a business in Singapore as they might be unfamiliar with the laws and regulations.

Foreigners cannot register for a new company due to non citizenship and must hire a local business registration provider to help with the company incorporation process. They also need to acquire a work visa or pass to be able to work in Singapore.

Even local entrepreneurs are advised to do the same as they might not be fully familiar with the Singapore company law and compliance requirements.

With the local business registration provider’s expert knowledge and experience, these professionals will direct you throughout the whole process for Singapore company incorporation, helping to save valuable time and money. The process can be summarized in 3 important steps:

1. Choose your business entity

ACRA allows registration of 3 types of business, mainly Private Limited Company (Pte Ltd), Sole Proprietorship and Limited Liability Partnership (LLP). You need to decide on the type of business structure that works best for you before company incorporation.

A simple method to decide is by how many professionals your business has. Eg. If you are the only one, a Sole Proprietorship might prove beneficial as you will be able to make all the business decisions.

If there are 2 or more professionals (up to 20), registering for a Limited Liability Partnership might prove beneficial. However, if there are 1 to 50 individuals who own a part of the capital at limited risk, registering as a Private Limited Company would probably work the best for you.

Nowadays, many new companies register with ACRA as “private limited companies” due to its flexibility in scaling. Furthermore, shareholders are not liable for debts and losses beyond their share capital.

2. Set up your company

One important step to do before company incorporation is to have your company name approved by ACRA first. It is a simple online process and your company name is subject to the following guidelines:

The name cannot be identical to an existing business in Singapore
The name must not infringe on any trademarks, free of copyright issue
The name cannot be obscene or vulgar
The name must not have been reserved by another company

Overall, these following documents are required for submission to ACRA:

Company name approved and registered with ACRA
A brief description of business activities
Details of registered company address in Singapore
Particulars of shareholders
Particulars of directors
Particulars of company secretary
Foreign Entrepreneurs must submit a copy of their passport and proof of overseas residential address
Foreign Companies must submit Memorandum & Articles of Associations
Singapore Residents must submit a copy of their Singapore identity card

3. Register with ACRA and open a corporate bank account

Once the company incorporation documents have been prepared, you can officially register your company with ACRA. Only in rare cases when the company incorporation needs to be referred to a government agency for further vetting, will the process take a few weeks.

After company incorporation, you can open a corporate bank account so that you can keep track of how much revenue comes in and how much monies are used to cover company expenditure and overhead costs etc.

In conclusion, the whole process might seem easy but it can actually take at least 2 weeks to 3 months, depending on business size. When you engage a local business registration provider, it not only helps to save the man hours but also automates the whole process so you get to keep track real time. No information is lost in back and forth emails too. We hope this information has been useful and bon voyage to a smooth entrepreneurship!

January 16, 2021/by Editor

Business

Corporate Tax Services – 5 Great Benefits of Engaging A Professional

Tax services are getting highly popular nowadays. Do you find yourself getting a headache whenever it comes to filing business taxes for the past year? There can be so many requirements and it differs from country to country.

Sometimes it is better to hire tax service professionals to handle and prepare your business tax returns for you rather than doing it yourself. Trust me, you will save so much time and effort that you will feel the cost of hiring a tax service professional is well spent!

With less stress, increased accuracy and maximum refunds, it is efficiency on a whole new level. Leave business tax filing to the experts and you can use that extra time to close more sales, hence doubling your productivity. Still not convinced? Let me break it down to you on the 5 WHYS of engaging a tax service professional.

1. Saves money

You might think that it is a waste of money to engage a tax service professional but in reality, it’s gonna be the exact opposite. Tax service professionals live and breathe their jobs so they are constantly being updated on the latest tax guidelines and regulations.

Combined with experience and knowledge, they know their stuff well, like the back of their hands. They will be able to identify the possibility of deductions and credits that you might not be aware of so by calculating the value of man hours that would be required for you to complete the business tax filing, you may find that engaging a tax service professional is well worth the money.

2. Maximizes time

If you actually sit down and calculate the time required to file business tax returns from start to finish; also depending on your business size, it can range anywhere from 20 to 100 man hours per year. So an average business tax return might take 50 man hours. Imagine what you can do with 50 hours?!

During this 50 hours, you could either spend some quality time with your loved ones, go for a short vacation to rejuvenate yourself or close more sales that could at least double your income for the year. Productivity is definitely in motion!

3. Reduces errors

When you are inexperienced in business tax filing, errors will happen and they can delay any refunds or rebates due to you. Some common tax errors are simple mathematical errors, entering payments on the wrong line or computation errors when determining taxable income.

With their extensive training, knowledge and experience; tax service professionals will greatly reduce the risk of errors that will be made on your business tax returns and this helps to decrease the likelihood of being subject to an audit.

4. Assistance with audits

While audits are rare, should your business be audited, you can rest assured that your tax service professional will have your back. Since he/ she was the one who helped you with the business tax filing, you can direct all enquiries to him/ her.

Audits can be very stressful and not only that, you need to know and remember where and when a piece of information can be found whenever the auditors ask for clarification. I can’t even remember what I ate for dinner 5 days ago, let alone such financial details! So rather than possibly subjecting yourself to more stress and frustrations, it is best to leave business tax filing to the tax service professionals.

5. Peace of mind

When you engage a tax service professional, you basically just need to give them the required information and they will sort it out for you according to current business tax regulations.

Tax service professionals will know your tax situation at a glance and will be able to pinpoint quickly what are the next steps; identify deductions and credits to reduce your tax liability etc. Knowing that your business taxes have been filed properly each year gives you peace of mind. No stress, easy peasy!

In conclusion, we hope you get to spend more productive time on improving your business turnover and leave business tax filing to the experts. All in all, we hope you can achieve more with less!

January 14, 2021/by Editor

Business

Accounting Services – 4 Powerful Benefits

More and more companies are engaging accounting services. Why? Many small businesses, entrepreneurs and startups find it challenging to hire an accountant, especially one with the right skills and experience to handle all their bank account operations, financial statements, analysis of financial data and issuance of invoices etc.

Nowadays, combined with the ongoing pandemic, it proves even more challenging to find a qualified and eligible person at an affordable rate. However, business owners cannot deny that outsourcing their accounting ultimately benefits them at the end of the day.

More than one thirds of small businesses are outsourcing their accounting to accounting services firms because they do not feel confident and comfortable doing it on their own due to time and lack of experience etc. Trust me, outsourcing your accounting will do you more good than harm so let us run through on the 4 powerful benefits of outsourcing your business accounting:

1. Access to expertise

Accounting services firms specialize in accounting so naturally, it is advisable to outsource your accounting to them. Because this is where the accounting experts are and they literally have the information and knowledge at their fingertips. You will also be ensured that compliance is in check.

By engaging a firm, you can be confident your finances are in good hands. They are handled by the most qualified individuals in an unbiased and objective manner. Accounting services can be customized to meet your business needs at different stages of your business so there is greater flexibility across the board.

2. Saves time

As the saying goes, time is money. You definitely save a lot of time when you outsource your accounting. When you have a team of accounting services experts having your back, you can be rest assured the accounting responsibilities will be completed on time.

You also free up time for yourself and for the inexperienced employee who has had to handle the accounting because a suitable accountant could not be found. Workload management is enhanced and thereby increasing productivity.

3. Reduces business costs

Studies have shown that an average audit department produces 1,400 hours of productivity per employee each year and absorbs the remaining hours as the price of having the department. With outsourcing, you only pay for the accounting services you need and when you need them.

Firms manage the relationship between the accounting experts and businesses so you do not need to worry about staff costs or turnover. This means that you do not need to allocate time or money to training and recruitment, at the same time not having to worry about accounting tasks being neglected because the employee is sick or on maternity leave.

Engaging accounting services help you streamline processes and better results are achieved, with insights on business performance so you can plan and use your budget wisely.

4. Automation

Many businesses use accounting software and cloud servers to save space and time. Not only that, it will help to reduce risks too. When you use cloud servers and accounting software, you can access anytime and all the information is in one central place.

Automation accounting helps to minimize human errors and accountants get real time reports. They help in detecting potential issues and resolving them in the early stage. Most importantly, it also reduces the probability of internal fraud.

Automation accounting software is affordable and you can scale accordingly based on your business needs. For starters, you can try Xero which comes with a free version and is highly popular for its versatile features such as automatic bank and credit card account feeds, invoicing, standard business and management reporting etc.

There are so many benefits to outsourcing your business accounting. In summary, we hope that business owners can save huge in terms of time and money, allowing the resources to be allocated and used more wisely to reap better business performance.

January 11, 2021/by Editor

Business

Business Development Collaboration – 4 Important Pillars

Business Development Collaboration? Never really heard of this term before or there is not much information on this particular topic…It is something that not many firms are putting into use yet but time and technology has proven its ability to be a highly effective method in business development.

When we talk about business development, we are talking specifically more on how internal teams can work with one another to bring the sales revenue in – separating and distinguishing the difference between successful and uber-successful, superstar firms.

Usually in every firm, the sales team is the one mainly responsible for bringing the business in and hence the most highly valued in the whole firm. But look at it this way – before the business comes in, it could be possible that the new potential prospect called and made an enquiry on your firm’s products and services or the newly clinched sale prospect called and asked about billing of the invoice. In both cases, the customer service and billing departments would be involved.

If they should encounter a bad experience at any point of time, it could burn the opportunity of clinching a sale or further sales with the new client. You must be thinking “The business development team knows what we are doing and our marketing is top notch, right?”. What if you could double the closing speed with half the effort? Wouldn’t it make hitting targets so much easier just like taking a walk in the park?

Let’s expound on this further. Imagine an important contract is up for renewal and this renewal could affect your bonus for this year and hence getting your new fancy automobile. The client has gone silent, refusing to reply to your text messages, calls or emails.

Plus there is so much stiff competition from other information technology (IT) firms, you really have no idea whether the client would continue to choose your firm as their preferred IT services provider.

As staff members rallied together and discussed the issue, they realized that their head of customer service actually had a personal relationship with the client’s head of IT operations after knowing each other at a business conference. The head of customer service engaged and identified service issues that could have cost the firm millions in lost business.

Now that you understand how a business development collaboration could improve your business revenue, let’s break it down further into 4 most important pillars to get you started:

1. Business development is an organizational mission

You have gotta come to terms with this notion that business development is an organizational mission instead of an individual or departmental one. The saying “Teamwork makes the dream work” definitely rings true!

You need to decide from top down, that your firm will empower strategic partners, employees and business colleagues to drive business growth by using their combined networks of influence. Create systems and processes as well as address personnel or obstacles that stand in the way.

2. Circles of influence

The circles of influence are not to be overlooked and what are they? They are Networks of Influence (NOI), Community of Influence (COI) and Event Engagement Influence (EEI).

NOI – popular networking social media like LinkedIn and Twitter offers powerful insight on the relationship between a firm’s employees and its prospects.

Eg. A mid-sized catering firm penetrated a major fintech company after its head of business development noticed a mid-level employee engaging directly with the prospect’s VP of operations, whom she had met at a business conference.

COI – face to face interaction remains crucial to business development success. However, advancing technology like the internet eliminates the prospect’s need for such communication in many stages of the sales cycle.

Thus our reliance on communities such as interest groups or non profit organizations, is key to bringing people closer together than ever before.

EEI – events are another important driver for face to face connections. Always do up your homework or action plans before an event, during an event and after an event.

They are foundational to your event strategy, especially what you do after an event because after all, that is the most important stage to gaining a return on your action plan and engagement. Being prepared is half the battle won.

3. Prospect relationship maps (PRMs)

Leveraging relationship-building activities such as NOI and COI will increase the potential entry points into many prospect organizations. Developing a formal process for PRMs serves as a powerful account-based strategy because they dive into many aspects – prospect companies, their employees, work history and social media profiles etc. This paves for a smoother highway to success.

4. Strategic Advisory

The benefits of consultative selling are well documented and your prospects can definitely benefit from this. There are many subject matter experts, data and intellectual property at all levels in your firm.

Developing a strategy and process to deliver this data in layman terms be it using an advisory board or digital marketing, adds value to your prospects on an ongoing basis and will reap its harvest when the closing of a sale is at hand.

Business development collaboration makes or breaks the company and revenue in the long term. Practising all these deliverables with well planned execution will put you in a more favourable position with prospects, stakeholders and clients. It ensures longevity to continued business success – like a tree, planting its roots in the ground and grows strongly with lush green leaves no matter the season.

January 7, 2021/by Editor

Business

Payment Gateway 101 – Easy Quick-Start Why And How To

Many business websites have either product or service offerings and especially for the former, it will be more convenient to set up a payment gateway. Why a payment gateway? With the booming e-commerce trade and many people turning to online shopping especially during the pandemic, it is so crucial to have a payment gateway on your business website.

A payment gateway is a merchant service provided by an e-commerce application service provider that authorizes online credit card or direct payments for online businesses and/ or even brick and mortar businesses. The payment gateway may be provided by a bank or by a third party financial service provider.

A payment gateway facilitates a payment transaction between a merchant and their customers. It sends credit card information from the merchant’s website to the payment processor and returning transaction details back to the customer. The payment gateway is responsible for encryption, request and fulfillment etc within a few seconds, Ultimately, it is used to make the payment process secure and easy for the customer who can just shop whenever they like without the limits of location or operating hours when it comes to payment. Payment is just a few simple clicks away.

Statistics have shown that in June 2020, global e-commerce traffic had a monthly record of 22 billion visits, with exceptionally high demand for daily essentials such as groceries and clothing but also tech items. Driven to an unprecedented high due to the pandemic; how online shopping and the overall future of e-commerce in 2021 and beyond will largely depend on the progression of COVID-19.

If you have not set up a payment gateway on your business website or if you are going to launch a new business website, now is the best time to set up one.

Today, we are going to talk about the types of payment gateways and you can choose the one that is most suited for your business needs.

1. Payment off site

When a customer makes the purchase, the front end checkout will occur on your business website but the payment processing will happen through your payment gateway provider’s back end. There are advantages to handling your payments this way, simplicity being the most of all. However, you won’t be able to control the customer experience and you will be at the mercy of the payment gateway provider’s off site quality and its quirks.

2. Redirects

Redirects might include an option for a Paypal payment, meaning upon checking out; the payment gateway will take a customer to the payment gateway provider’s payment page to complete the transaction (processing and payment), it becomes a “Redirect”. This is extremely useful for small businesses which has the advantage of simplicity, convenience and security of a widely recognized platform like Paypal but the process also means less control for the merchant and an extra step for the customer through the shopping experience.

3. On site payment

This is usually used by large companies, handled on their own servers. The checkout and payment process all go through your system. You will have more control over the customer experience but also more responsibility. Retail carts have an abandonment rate of 75% so every variable counts to meeting the bottom line. It means you need to be on a constant lookout to check the analytics and see there is anything you can do to improve the customer experience or reduce the cart abandonment rate. This is especially important for companies who work with a large volume of sales every day.

These are the common payment gateway types used for businesses. You must be thinking “But which payment gateway should I choose?” Fret not, my friend. We got you covered too!

Here are the top 3 payment gateway options:

1. Amazon Pay

Amazon, like Paypal, is also a widely recognized platform which has 300+ million customer accounts worldwide. This makes it very attractive as a trusted payment gateway provider option and it comes with a number of plugins, including some for use with BigCommerce. A big advantage is that whoever has an Amazon account can use Amazon Pay to make payment for online transactions without needing to create a new account or key in credit card information. Current processing fees are 2.9% on domestic transactions with an additional $0.30 per transaction. International fees escalate to 3.9%.

2. Paypal

Paypal is popular as a redirect payment gateway provider because it is widely recognized worldwide which means many customers trust this provider a lot. They have two options: a $0 per month checkout payment gateway hosted by PayPal, or a $25 per month option with more checkout customization features. Whichever option you choose, Paypal adds fraud protection security without any additional charge. This gives you the assurance that your payment gateway is safe. Current processing fees are 2.9% with an additional $0.30 per transaction.

3. Stripe

Stripe is a popular payment gateway provider with broad focus on various payments: mobile e-commerce, non-profit, software as a service (SaaS) and platform-based payments. It is also capable of handling companies who deal with a large volume of sales transactions. In addition, Stripe can be used as a standalone solution for businesses who need to send out invoices and collect payments for products or services. Processing fees are currently 2.9% and $0.30 per transaction.

We hope you are ready to get started on setting up at least 2 payment gateways on your website, making it hassle free and giving more options for customers during payment and for yourself in terms of tracking where traditional payment methods are used.

Last but not least, we advise you to always use established payment gateway providers like those mentioned above so that the customer experience is enjoyable from start to finish and this will add on to your business credibility and branding in the long run.

November 26, 2020/by Editor