Thursday, August 15, 2019

How to Manage Reviews for Better Small Business Profit - Small Business Trends

How to Manage Reviews for Better Small Business Profit - Small Business Trends


How to Manage Reviews for Better Small Business Profit - Small Business Trends

Posted: 14 Aug 2019 09:00 AM PDT

You know that online reviews of your retail business matter. But did you know the businesses that do best at managing their online reviews actually earn more money? That's part of the findings of an in-depth study by Womply that analyzed more than 38,000 retail businesses nationwide.



How to Manage Reviews for Your Retail Business

Keep reading to find out how to use online reviews to increase sales for your retail business's revenues.

Tip 1: Get More Listings

It's easy and free to claim your listings on online review sites, so why not do it? Local businesses that claim their listings on three or more review sites earn 21% more revenue than the average business, Womply found. Conversely, retailers that don't claim their listing on any review sites earn 22% less revenue than the average business. That's a lot of money to lose for just skipping such a simple step.

Start by claiming your listings on Google, Yelp, and Facebook — the most important review sites. (If you do only one, start with Google, since these ratings show up in your Google search results.) Retailers who claim their listings on just those three sites average $56,000 more in sales per year than those who claim none of their listings.

Tip 2: Respond to Your Reviews

A whopping 75% of retailers never respond to their reviews. While this doesn't negatively affect their profits too much (they earn 6% less than the average business), responding to reviews can have a more substantial positive effect. Retailers that respond to reviews –even just semi-regularly — earn 19% more in annual revenues.

Set up alerts when you get a new review so you can respond quickly. It's especially important to respond to negative reviews fast, as it shows you're paying attention to what your customers are saying. Be sure not to get defensive: Apologize for the issue and ask if you can contact the customer (offline) to discuss it. Once you're rectified the problem, see if the reviewer is willing to update their review. This helps show other prospective customers that you're providing good customer service.

Avoid posting a generic, template response to each positive review. Varying your wording a bit makes it sound like there's a real person reading the reviews.

Tip 3: Get More Reviews

More reviews correlates to more revenue, Womply found. The average number of reviews for a local retailer is 43. Local retail businesses with more than 43 reviews bring in 26% more in annual revenue than the average retailer.

If you don't have 43 reviews yet, focus on achieving that figure — and then keep going! Retailers with more than 200 reviews earn 46% more than the average, so there's a lot of benefit in growing your review base. To get more reviews:

  • Put signage in your store reminding customers to review you. You can download free window clings and other marketing tools on Yelp.
  • Put links to your review listings on the home page of your website, along with language encouraging customers to write a review.
  • Include requests to review your business in your marketing emails or other emails to customers.

Check out Google's tips on how to get more Google reviews.

Tip 4: Keep Those Reviews Coming

Having 200 reviews won't help you that much if they're all from two years ago. "Fresh" reviews are essential to keep customers coming in to your store. Womply defines "fresh" reviews as those posted in the last 90 days; the average retail store has five fresh reviews at any given time.

Once again, being above average will get you above-average sales. Retailers with more than five fresh reviews earn 28% more in annual revenue than the average retailer, the study found, while retailers with 20 or more fresh reviews earn 40% more. In contrast, businesses that have no fresh reviews earn 13% less than average.

To keep those fresh reviews coming, keep doing what you're doing in Tip 3 to get more reviews.

Tip 5: Aim for Realistic Reviews

You might be surprised, as I was, to learn that retailers with 5-star ratings actually have below-average sales. They even earn less than shops with a 1 to 1.5-star rating. Perhaps customers don't believe the 5-star reviews can be honest? Whatever the reason, the sweet spot for reviews is 3.5 to 4.5 stars. Retail businesses whose ratings are in this range earn revenues 13% more than the average retailer.

You can't control the star ratings you get, but if too many reviewers are raving about your business, working to get more reviews should help even things out.

Now that you know online reviews can actually make your store more money, are you more motivated to manage them?

Not a retailer? Check out Womply's findings on how online reviews impact small businesses in all industries.

Image: Depositphotos.com

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How to Use Peer-to-Peer Loans to Fund Your Small Business - Yahoo Finance

Posted: 14 Aug 2019 09:18 AM PDT

If you need funding for your small business, peer-to-peer loans are an alternative to bank loans or other types of financing. While these loans are often associated with personal lending, some are offered to businesses.

A peer-to-peer loan can provide flexibility and convenience to help you cover day-to-day expenses or invest in your business for growth. Here is what you need to know about peer-to-peer, or P2P, lending and whether it could work for your business.

What Is Peer-to-Peer Lending?

With a typical small-business loan, you are borrowing money from a lender such as a bank, credit union or financing company that offers business loans. Individuals and institutions such as investment banks fund P2P loans. The loans are completed through a P2P lending platform, which acts as a middleman between borrower and lender.

[Read: Best Small Business Loans.]

The advantage for the investor is that the money you borrow must be repaid with interest. Depending on the rate, your loan could give the person or people funding it a better return on investment than other options.

The benefit to you as the business owner is that you can borrow without going through a bank. And P2P loans can help meet many of the same funding needs as traditional business loans, such as:

-- Paying startup costs

-- Refinancing business debt

-- Purchasing equipment

-- Buying inventory or supplies

-- Covering training or hiring costs

-- Renovating or expanding facilities

-- Funding a marketing campaign

Always check with lenders about restrictions on how P2P loans can be used.

How Do P2P Business Loans Work?

The process for getting a P2P business loan is almost the same as a P2P personal loan.

-- You register for an account with the P2P lending platform.

-- The lending platform or marketplace reviews your credit and business financials to determine your creditworthiness.

-- The platform assigns you a credit rating, which determines interest rates and loans you qualify for.

-- You can then apply for loans through the platform, based on the amount of money you need and how it will be used.

-- Investors review your loan request and credit rating to decide if they want to fund your loan and, if so, how much to fund.

Once your loan is fully funded, the P2P platform releases the money to you, typically through an electronic deposit to your bank account. You then pay back the money, with interest, through the platform.

This type of loan usually doesn't require collateral as security. That's helpful if you don't have significant business assets or if you don't want to pledge business assets. But keep in mind that you'll likely have to sign a personal guarantee for a P2P business loan. This guarantee means you are personally responsible for repaying the debt, even if the loan is in your business's name.

Some lenders may also ask for a Uniform Commercial Code lien when you borrow above a certain amount. A UCC lien gives a lender the ability to use any of your business assets to repay a loan if you default.

[Read: Best Unsecured Business Loans.]

What Are P2P Loan Terms for Small Businesses?

Every P2P platform operates differently when it comes to loan terms, fees, interest rates and borrowing limits. This table shows the range of terms you may find:

P2P Loan Terms
Loan Amounts $2,000 to $2 million
Repayment Terms Six months to 10 years
APR 4.99% to 39.99%
Origination Fees 0% to 8%

Researching P2P loan platforms can help you choose a loan that best fits your business needs and budget.

How Do You Qualify for a P2P Business Loan?

Minimum qualifications for a P2P business loan vary. Some may require a minimum credit score of 600 and at least one year in business. Others may raise the bar a little higher and expect a score of 620 or better and at least two years in business.

The P2P lending platform will determine whether you qualify by reviewing information you share when you apply for the loan. Most platforms ask for the same general information, such as:

-- Business and personal credit scores

-- Time in business

-- Average annual revenue

-- Tax returns for the last two years

-- Business and personal banking statements

-- Business financial documents, such as your balance sheet, cash flow statement and earnings statement

You may also need to disclose any outstanding loans that aren't listed on your credit reports.

What Are the Benefits of Using P2P Loans to Fund a Business?

P2P loans tend to be more accessible than business loans from a bank or credit union. If you've struggled to get business financing from other sources because of poor credit, a P2P loan could open up the door to funding.

"Generally, there is much less concern with personal creditworthiness and more emphasis on the financials of the particular project," says Robert Pellegrini, president of PK Boston Law and advisor to small businesses using P2P lending. "Likewise, there are generally much fewer documents to sign at the closing table."

From start to finish, the P2P loan process is much quicker and easier than the traditional method, Pellegrini adds. Setting up your profile and applying through a lending platform can take just a few minutes.

The entire underwriting process could take one to two weeks. And once your loan is funded, you could get the money in just a few business days.

What Are the Drawbacks of P2P Loans for Businesses?

A P2P loan may be easier to qualify for compared with a traditional business loan, but you may end up at a disadvantage with the interest rate. If you have poor or bad credit, you might be looking at a much higher rate to borrow money.

Then you'd have to weigh the convenience of the loan against the cost. If you can't get a loan elsewhere and the cost is worthwhile for your business, then a higher rate may be an acceptable trade-off.

While not necessarily a drawback, the novelty of P2P loans is another reason to be skeptical of this type of business borrowing.

"P2P lending is still relatively young, so it's not as well-regulated as other forms of lending," says Chloe Gawrych, senior writer and business expert at Business.org, which researches, reviews and recommends software and services for small businesses. "That means there's more risk for both borrowers and investors."

The risk to investors is that the businesses they lend to won't pay back what they borrow. On the borrower side, read the terms of the loan agreement carefully. Look for penalty rates or fees that may be buried in the fine print. You'll want to know about them before signing off on a loan.

[Read: Best Bad Credit Loans for Small Businesses.]

How Can You Evaluate Peer-to-Peer Lending Options?

If you think that a P2P loan could be a good fit for your business, evaluate the loan the same way you would any other product. As you compare loans, look at your:

-- Estimated payment. Before agreeing to any P2P business loan, review your business's financials to make sure you can repay it. The loan you choose should help you achieve your goals without putting undue strain on your cash flow.

-- Interest rates. Check the APR ranges different lenders offer to estimate how much a loan might cost. Also, ask whether the rates are fixed or variable because that can affect your monthly payment.

-- Fees. Get a rundown of the fees you will pay to list your loan on the platform, plus any ongoing or one-time fees you'll be charged. Check to see whether the lender charges a loan origination fee or prepayment penalty.

-- Loan amounts. Review loan minimums and maximums so you know whether your desired loan amount falls within what's available.

-- Repayment terms. Compare how long different lenders give you to repay a P2P loan.

-- Minimum credit and financial qualifications. Checking the minimum requirements for approval can help you avoid applying for loans you won't qualify for.

-- Collateral and personal guarantee requirements. Consider whether you'll need to offer collateral or a personal guarantee to get a loan.

"As with any situation where someone is shopping around for a loan, borrowers should be looking at all of the terms to determine whether taking the loan would be a good decision," Pellegrini says.

More From US News & World Report

2 Michiana counties named among best for small businesses - WNDU-TV

Posted: 14 Aug 2019 02:12 PM PDT

(WNDU) - A new study ranks two counties in Michiana as two of the Top 10 places in Indiana for small-business owners.

LaGrange County is the second best county in the state for small-business owners, while St. Joseph County is the ninth best, according to a study by SmartAsset.

The study weighed the percentage of people in a county with small-business income, the proportion of that income to overall income and taxes paid by small-business owners.

9 Tips to Help Your Small Business Do Well on Social Media - Atlanta Small Business Network

Posted: 14 Aug 2019 03:00 AM PDT

Social media can help small businesses reach out to both existing and potential customers. When you make use of it in the right way, social media can help boost sales. Some entrepreneurs have built entire companies and customer bases on social media. If you don't take the trouble to get it right, however, social media for small businesses can end up being a waste of time, or end up alienating people. What follows are 9 tips on how to do the best you can with your small business social media presence.

Think About How Social Media Can Help with Your Marketing Objectives

Too often, business owners simply get on social media because they feel obligated to be there. Before you become involved in social media, it's important to think about what exactly it is that you wish to see it do for your marketing. You need to plan for how exactly social media can help you widen your customer base, and improve customer satisfaction and perception. You need to gauge your efforts to see how successful you've been.

Build Reputation and Authority

social media

social media

Social media isn't simply about building a name for yourself among customers. Social media destinations such as LinkedIn can also help you network with industry personalities, and build authority among them. Authority in the industry can help your business attract better employees.

Do your Best to Start Interesting Conversations

Facebook's algorithm is designed to boost posts that attract user interaction. If you post something that no one responds to, Facebook stops showing it to people. With Facebook's recent focus on promoting social posts over business posts, it can only be harder than ever for businesses to reach their followers. It can take insight into the way people's minds work to know how to get them to respond to you. If you're a car dealer, for instance, simply posting the image of a happy customer with their car isn't likely to get much interaction. If you tell your followers that it's the customer's first car, however, and ask them to share their own stories of their first experience buying a car, it could invite responses.

Be Appreciative

It's important to understand that social media isn't just a website where you simply tell the world about your products, your history and about your special deals. It's also a place where you get in touch with the people who have mattered the most to you in your journey as an entrepreneur. Whatever other entrepreneurs or managers have taught you along the way, it's a good idea to thank them on social media. Not only does it tell everyone on your social media pages more about who you are, it's a gesture, as well, to the people who have shaped you.

Follow Metrics

Advertising on Facebook can bring great results. It takes a learning curve to truly understand what works and what doesn't, however. You need to do more than just pay attention to vanity metrics like follows, likes or impressions. Instead, you need to measure the results that you get, with Facebook Pixel, or Facebook lead ads. You should constantly measure your investment in Facebook advertising against the sales or leads that you generate, to make sure that your investment is worthwhile.

Focus on One Platform

While you should make sure that you claim accounts for your business on every major social platform, you should focus on the ones that most of your customers are on. Share content that you love and would like to pass on to your followers, and post original content occasionally, as well. It's important to listen carefully to your followers to judge if you're doing well and to tweak your approach when you see your followers' attention flagging. You should try your best to understand what works with your audience, what doesn't. You're most likely to do this well when you're focused on one social media network.

Build an Editorial Calendar

social media

social media

You can't simply spontaneously post whatever comes to your mind and expect that your audience will be interested. You need to create a content strategy and an editorial calendar to make sure that you come up with the right kind of content at the right times to retain audience interest. A calendar can also help you think about how often you should post, and get you to commit to a schedule so that you never let too much time pass between posts.

Share Visual Posts More Than Text Posts

Images and video rule on social media. People are far more interested in the passive entertainment that these forms of content provide, than in actually reading. It can even help to develop a presence on platforms that focus on photos and videos, like Pinterest and Instagram.

Put Someone in Charge of Social Media

As a small business owner, you need to devote as much of your time as possible to run your business. If you try to manage your social media presence by yourself, you're likely to struggle. It's a much better idea to either hire someone to take charge of your social media or to outsource your social media management to a marketing agency.

Managing your company's presence on social media can be much more work than it appears to be. It's important that you commit your business to meaningful interactions with your customer base, however. When you truly establish a conversational relationship with your customer base, you will have customers who are far more likely to recommend you to their friends, and ones who stay loyal to you.

 


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