If you’re thinking about launching a new marketing campaign, the first thing you need to do is check whether it’ll benefit your company or not. To measure how much revenue a certain campaign will generate, marketers check its ROI. ROI is an acronym for return on investment. It’s a common concept in the business world. To give a straightforward answer to the question from the title of this article - “What is ROI in marketing?” - we can say it’s a strategy that helps determine how much money you spend on a marketing project vs. the amount of revenue you gain from it. As this is one of the vital calculations in marketing, we’ll focus on its purpose and explain how you can analyze the marketing ROI for your company. The Importance of ROI in Marketing Marketing professionals and business owners, in general, rely on data-driven evaluations to help them decide how to assign their marketing budgets. And that is where ROI steps in, as it allows marketers to develop a more successful strategy by using their resources more effectively. Now let’s see what the key functions and the true purpose of ROI in marketing are. Prioritizing Projects By calculating the ROI of multiple marketing campaigns, you’ll be able to see which one of them brings you the most value, and that can help you correctly prioritize campaigns to boost your company’s revenue growth. ROI will also shed light on which projects aren’t bringing enough revenue and possibly hurt your business. Once you measure the ROI of each campaign, you’ll be able to decide whether to reevaluate your marketing strategy or end some of those projects. Selecting Future Projects Once you learn how to prioritize your current projects, it’ll be easier to find a pattern to successfully target your audience in the future. Measuring ROI in marketing will help you learn from experience and develop new strategies when choosing your future projects. Understanding Your Audience One of the greatest advantages of knowing your ROI in marketing is that it allows you to better understand your audience and its behavior. It doesn’t just give you an insight into the numbers coming from various projects; it also shows which strategies have the best impact on your audience. Once you know that, it gets much easier to decide which type of advertising to go with to draw in new clients. To fully answer the question “Why is marketing ROI important?” we shouldn’t overlook client satisfaction. If you work in a marketing agency and your clients are other businesses, one of the most important things to keep in mind when creating a new marketing strategy is how you’ll present it to your existing and potential clients. Apart from reliable CRM, which has already become a common practice among real estate companies, brokerages, and many other businesses, incorporating the predicted ROI of your campaign into the presentation is also something that can boost your clients’ trust. Understanding Competition Knowing how to define your ROI in marketing and measure it correctly can take you a long way. However, many experienced marketers go one step further and compare their marketing ROI with that of their competitors. This helps them determine how their marketing campaigns relate to others in the industry in terms of efficiency. Studying the business strategies of your competitors who have a higher ROI percentage can give you an idea how to improve your own business. Better Budget Allocation The ultimate goal of understanding ROI in marketing is better budget allocation. Marketing budgets are always lower than you’d like them to be, so learning how to use the funds you do have at your disposal wisely is essential. To achieve better results, you need to know which projects require less investment but bring more revenue. How To Calculate ROI in Marketing The easiest way to determine your marketing ROI is to compare your revenue to your marketing expenses. One of the simplest equations for calculating ROI is: (Revenue − Investment) / Investment If, for example, you invest $10,000 in a particular project, and generate $20,000 from it, your ROI formula will look like this: ($20,000 − $10,000) / $10,000 ＝ 1 To calculate your marketing ROI percentage, you should multiply this final number by 100. In this case, your marketing ROI would be 100%. There are a few things to keep in mind when calculating your marketing ROI. Here, we’ll go over each in more detail. Set a Time Frame One of the crucial things when determining your marketing ROI is to set an appropriate time frame for data gathering. If you wish to see if your latest marketing campaign was a success, you need to allow enough time for it to reach your clients before looking for a return on your investments. Also, be consistent and use data from the same business cycle. Measure the Marketing Cost and Sales Growth Now that you know the meaning of ROI in marketing and its importance, your next step should be to collect all the relevant financial data about your marketing project. If you need to calculate an ROI and have a large amount of data to process, seek help from the bookkeepers and accountants. Consider keeping a marketing record where you could enter all your ROI calculations to gain insight into which factors influence your marketing ROI the most. What Is a Good Marketing ROI? Marketing ROIs are usually expressed in ratios. What is a good ROI ratio in marketing? You should aim for a 5:1 ratio at least. Anything below a 2:1 ratio is considered unprofitable; anything below 1:1 is negative ROI, while an ROI ratio above 5:1 is deemed to be strong for most businesses. When calculating your ROI, you should factor in all the marketing costs your campaign will incur, including: Pay-per-click spend Media spend Content production costs Outside marketing and advertising agency fees Make sure you don’t overlook anything because understating your costs will result in an incorrectly calculated and unrealistic ROI. Marketing ROI Examples and Strategies Now that you’re familiar with some basic reference values, let’s go through a couple of practical examples. Pay-per-Click Campaigns PPC is an advertising model in which you pay a certain provider to promote your ad based on the number of user clicks on your ad, whether or not it leads to a sale. The ROI formula can help you track your ad performance and manage your PPC campaigns. For example, according to some PPC stats, Google search ads have an average ROI of 200% - for each dollar invested, marketers gain $2. Video Marketing For what else is ROI in marketing used for? For assessing the profitability of video marketing campaigns. Although video marketing can be pretty expensive and time-consuming, video marketing statistics indicate that 88% of marketers are satisfied with their social media video marketing ROI. Email Marketing Even though many think sending emails is outdated, it’s still one of the key marketing tools. Recent statistics show that email marketing is the most effective way to promote your business. This type of marketing brings $40 back for every $1 spent, so it comes as no surprise that many marketers see it as their number-one tool for revenue generation. Paid Social Media Promotions We already know the importance and numerous benefits of ROI in marketing. Now let’s see what it can tell you about the effectiveness of your social media promotions. Suppose your company targets an audience that regularly uses social media platforms such as Instagram, Facebook, or Twitter. In that case, you might think about boosting your posts to get promoted on the newsfeeds of your targeted audience. Tracking the ROI of your campaign can help you see if this strategy works for you and determine the types of posts that lead to the revenue increase. If you look at social media marketing stats, you’ll notice that 94% of marketers use Facebook in their marketing campaigns. This isn’t surprising as Facebook is the biggest social media platform, with about 2.89 billion monthly active users. The Bottom Line Understanding ROI in marketing is a vital part of any marketing campaign. And even though calculating it might get complicated, it comes with great benefits. It enables you to gain a better insight into your marketing strategies, how they need to be tweaked, and determine your future marketing goals. Your marketing decisions and marketing budget should be based on fresh, verified, and detailed data - only then will you be able to calculate your ROI properly, adjust your business strategy, and ultimately, improve revenue growth.
If you’re into sales or run a small-business company, you already know how difficult it might be to keep track of everything. Most small-business companies are using some form of CRM to help them keep on top of things and increase sales, but there are also some tactics that you can start implementing on your own. Cross-selling and upselling are the key strategies that can help grow your revenue by boosting the average order value. We will start this article by explaining what each of these terms actually means before discussing how cross-selling vs. upselling works. Cross-selling definition and purpose Cross-selling is the strategy of offering customers additional items related to their initial purchase. By implementing this strategy, companies encourage customers to spend more money by purchasing additional items that complement their original purchase. In most cases, cross-selling includes products that users would buy anyway. As people sometimes tend to forget those items, it is beneficial for both sides to point them in the right direction. They will get all they need, and you will get your sales boosted. What is upselling? Upselling encourages customers to spend more money by purchasing a more expensive or upgraded version of their initial purchase. To apply the upsell, a salesperson needs to suggest an upgrade or persuade a customer to purchase add-ons. Upselling increases the average order value and helps customers get even more satisfied with their purchase. The difference between cross-selling and upselling Now that we know what both of these terms stand for let's summarize their differences. Here is one of the upselling vs. cross-selling examples we have all experienced. When you’re at your local fast food buying a cheeseburger, the salesperson will always offer to add some fries with that. That is a clear example of a cross-sell, and it’s a win-win situation cause who would say no to fries? If they offer to supersize your meal instead, and you agree, you have just become a “victim” of an upsell. How to successfully cross-sell and upsell There are a few things you should know if you wish to master the art of cross-selling and upselling. Learn all about your product. The most important thing to do before you start implementing cross-selling and upselling strategies is to get familiar with the product you’re offering. Make sure to look into all of your products and all of their features well to know how those products fit together. By combining two wrong products, you can turn the customer off instead of convincing them to purchase more. Get to know your audience. Try to collect as much information about your customers as you can. Real estate companies use CRM to easily keep track of amenities a property might have to ensure they’re presenting the customer with the best option possible. Collecting demographic and psychographic information about your customers and paying close attention to their feedback will make place for the new cross-selling and upselling opportunities. In the long run, these tactics can help you enhance customer satisfaction, which is crucial for running any successful business. Keep things simple. Offering too many products might be overwhelming for the customers, and it can create unnecessary confusion. You should always strive to build a long-term relationship with the customers and target a few items that would provide a clear benefit for them. Offer loyalty perks. Based on your business model, you should try to establish a loyalty scheme for regular customers. Customers who buy more should enjoy some loyalty offerings and get rewarded for their commitment to your store. Do follow-ups. Although there is a clear distinction between upselling vs. cross-selling, you can find the opportunity to implement both of these selling techniques after the customer has already made their purchase. You can achieve this by doing a follow-up after each successful sale to ensure they are happy with the purchase, and if they are, you can easily suggest appropriate upsell or cross-sell products. Cross-selling and upselling in eCommerce eCommerce is probably the best environment for cross-selling and upselling. According to eCommerce stats, online retail shops generated 14.34 billion visits in March 2020. These numbers show how the shopping trends have changed over the years. Learning how to make the best out of the new trends is vital, as there are multiple benefits of cross-selling and upselling to consider. eCommerce gives you a great opportunity for cross-selling and upselling because you have access to customer data and their shopping history, which can help you come up with the targeted offers. It’s also great as you can insert different cross-sell and upsell products throughout the shopping process or in the post-purchase confirmation email.
Both the enterprise resource planning system and customer relationship management software are valuable business solutions that help increase profitability and productivity. And although these are complementary technologies, they have different core functionalities. As part of our ERP vs. CRM showdown, we’ll tell you more about what those differences are. We’ll also delve deeper into some of their key characteristics, enabling you to decide which of these systems your business needs. What is ERP? ERP is a process that companies use to integrate and manage the most important parts of their daily business activities. As such, ERP software solutions are highly useful when it comes to the implementation of resource planning. ERP serves as a shared database that employees with relevant job functions can access and use to complete their daily tasks. Nowadays, it’s used for everything from risk management and compliance to procurement and accounting. Perhaps the most accurate ERP definition would be to describe the system as the glue that holds together all the financial and operational data. This is also one of the main benefits of using the system, as all of the data can be retrieved from a single source, making it easier to compile ad hoc and static monthly reports. Moreover, it gives employees access to financial insights, speeding up the decision-making process. It’s worth noting that ERP grew from the material requirements planning system. This probably helped immensely when it came to creating ERP as a software that can also handle inventory management and provide help with production and distribution. Another one of the more commonly cited examples of how ERP systems benefit businesses relates to the software’s role in closing the books. That’s because companies no longer have to waste time on data entry and consulting different departments. The ERP system automates many of those tasks, reducing monthly close times to just a few days. It can also provide an additional level of security, as having role-based permission - one of the key features of every sound ERP system - reduces financial risk. What is CRM? This is another system designed to streamline business operations. But unlike ERP, this software manages how customers interact with your company. Of course, this CRM software definition is somewhat broad. In peeling back the layers, you’ll quickly learn that CRM can assist your marketing, sales, and support teams in ensuring your clients are as happy with your services as they can be. Just like ERP, it provides businesses with a central database. This one is used for customer data, tracking all customer interactions while providing the aforementioned teams with the necessary information. The teams then use the analytics part of the software to identify important metrics within the CRM database, meaning the sales team gets the details it needs to improve sales and customer support services. Initially, this software was developed exclusively for sales departments and was known as sales force automation or SFA. Over time, other systems were designed and integrated into the original software to create an all-in-one solution for growing your business. Some CRM systems include sales performance management or sales incentive compensation. However, these add an additional level of complexity and are often sold separately. Ultimately, the CRM system, by definition, is created to cover all areas of customer interaction, and CRM statistics show that it’s more than helpful to small businesses. Keeping customers happy with your services and products guarantees returning customers who are much more valuable to a business than new ones. That’s not to say that CRM can’t help you find new clients - lead generation and identifying potential prospects is another feature of every CRM. From there, the system helps you lead the new customers through the sales process to close the deal - and then helps you bring back these customers for more. What Does Your Business Need? The objective of this CRM vs. ERP showdown isn’t to pick the better system. Identifying the key components of these business solutions is intended to help you decide what your company needs. In most cases, the answer is both. The two typically go hand in hand and complement each other. In some instances, they even overlap - there are platforms that allow the easy integration of both systems. Big corporations probably don’t think twice about using both. However, small and medium-sized businesses have to consider the cost. And this is where knowing the difference between ERP and CRM comes in handy. CRM systems start at $12 per user/month but can go as high as $300 per user/month. Meanwhile, the average ERP project costs $7,200, and depending on the number of employees, the total cost can be anywhere between $150,000 and $750,000 for a mid-sized business. So if your business is yet to scale to the point where you can afford these services without batting an eyelash, you might have to settle for either one or the other. A thorough ERP vs. CRM comparison will help you decide which one is more suitable for your business model. If your business revolves around your customer base and its success depends heavily on obtaining new and maintaining old customers, then investing in CRM and delaying the implementation of ERP is probably the best course of action. For example, real estate brokerages would undoubtedly benefit from a real estate CRM instead of dishing out a ton of cash for an ERP system. In this situation, having CRM software that can handle customers and spare you the cost of employing a lead generation company could prove invaluable. Of course, you might already be asking: what does ERP stand for? If that’s the case, your company probably has a small number of customers but a complex financial system. In these instances, integrating an ERP system is a better solution than relying on QuickBooks or other accounting software designed for small businesses. But as your business grows, both systems will become equally valuable. Until then, choose the software that will elevate your business to the next level. All in All It’s no secret that every business benefits from having all the relevant data in one place that’s easily accessible to all those who need it. That’s why having this ERP vs CRM software debate is crucial in establishing whether the integration of one or both solutions is required to grow your business. One can provide guidance for establishing relationships with customers, while the other helps you boost your finances and behind-the-scenes operations. While CRM manages interactions with your customers, you can rely on ERP to handle all your financial and operational data.
If you’re thinking about settling down and finding your dream home but don’t have enough cash for that just yet, you might consider getting a mortgage. In 2020, 842,000 houses were sold in the United States, and realtors had their hands full. Some of them used various CRM software to keep track of all the properties and help everyone find their dream home. Choosing the right type of mortgage can save you a lot of money, which is why it’s so important to understand how mortgages actually work. There are various types of mortgage loans, and the best option will depend on your current circumstances and future plans. Now let’s see what are the possibilities you have and how do they differentiate. What is a mortgage loan? Before we continue, let’s go through some basics to see what a mortgage is. A mortgage is a type of loan that helps you buy or refinance a home. Although mortgage rates had a serious drop earlier this year, many people still do not have enough cash to purchase a home, and a mortgage might be their only solution. As a mortgage is a long-term commitment, it’s crucial to take time and think about it carefully. Different types of mortgage loans As there are multiple options for mortgages, you should do the proper due diligence before choosing one. Ensure to understand the key advantages and disadvantages of each type of mortgage and the requirements they come with. Generally speaking, there are two main types of loans: Conforming Loans Non-conforming loans Conventional mortgages Fixed-rate mortgages Adjustable-rate mortgages USDA loans FHA loans VA loans Conforming loans Conforming loans are the ones that can be acquired by Fannie Mae or Freddie Mac, two government-sponsored enterprises (GSE) that buy and sell most conventional mortgages in the US. If a loan meets specific requirements set by the Federal Housing Finance Agency, it can be purchased and then resold through a mortgage by one of these institutions. There are different types of conforming mortgage loans; however, they all include the same requirements. They need to be below the maximum dollar limit, they can not be federally backed, and they must meet the lender’s specific criteria. The maximum dollar limit is the total amount of money an applicant is authorized to borrow. In 2021, in most parts of the US, the maximum conforming loan limit is $548,250 for one-unit properties. Conventional mortgages Conventional mortgages are the most common type of mortgage. To be more precise, they are a type of conforming loan funded by private financial lenders. Conventional mortgages are a popular choice as they don’t have strict income regulations like some other loans do. All types of conventional mortgage loans require a credit score of at least 620. In case you have a down payment of 20%, you are not obligated to buy private mortgage insurance (PMI). But if you still need to pay for the PMI, a good thing to know is that conventional loans usually have lower mortgage insurance rates than the other types of loans. So to summarize, here’s what you should know before getting a conventional mortgage. Advantages of conventional mortgages: To qualify for the loan, you need a down payment of just 3%. The overall borrowing cost is less than with unconventional loans. Although it’s the most popular out of all types of mortgage loans, conventional loans do have a few downsides, too. Disadvantages of conventional mortgages: The minimum credit score you need is 620. All down payments lower than 20% require you to buy PMI. Fixed-rate mortgages Fixed-rate mortgages are the ones that have a fixed interest rate throughout their whole duration. They are a great option for people that know (or want to know) exactly how much they’ll have to pay each month. This information can help people make a long-term budget as the monthly payments are already set. There are multiple types of fixed-rate mortgage loans depending on the repayment period you choose, but most are two-year or five-year deals. The longer the repayment period, the higher the interest rate will be, so that is something to think about. Advantages of fixed-rate mortgages: Monthly payments don’t change over time, which helps borrowers plan a budget and stick to it. Disadvantages of conventional mortgages: Interest rates might be higher depending on your mortgage period, and you may end up paying more in interest over time. Adjustable-rate mortgages Adjustable-rate mortgages (ARM) are the opposite of fixed-rate ones. They are loans with interest rates that fluctuate depending on how the market changes. To compare the types of mortgage loans, let’s see how an ARM looks and what its requirements are. All ARMs start with an introductory period of fixed interest which normally lasts for five, seven, or ten years. After this period ends, your interest rates may vary based on the market trends. ARMs, however, include rate caps to give you an insight into how much your rate can change over time, and they protect you from rapidly increasing interest rates. Advantages of fixed-rate mortgages: The introductory period has below-market rates. Disadvantages of conventional mortgages: Monthly payments can significantly increase along with the rate. Non-conforming loans Non-conforming loans are the ones that don’t meet conforming standards set by Fannie Mae and Freddie Mac. If you are interested in types of mortgage loans with no down payment, you should think about getting a non-conforming loan. According to real estate stats, the average down payment for a new home is $59,880, which is a figure that many people simply cannot afford. Non-conforming loans have less strict rules than the conforming ones, allowing you to take a larger loan than you would typically qualify for. They are also known as jumbo loans as they exceed the conforming loan limits. What’s great about nonconforming loans is that you can apply for one even if you have a lower credit score. Financial institutions don’t like non-conforming loans as they don’t match up to GSE guidelines, and they are harder to sell. Government-backed loans There are three main types of government mortgage loans: USDA loans, FHA loans, and VA loans. For each of these loan types, the government agency insures the loan amount and protects the lender in case a borrower can't repay their debt. Advantages of government-backed mortgages: Easier to qualify for as they have less strict requirements. Can allow you to save on down payments. Government protection in case you cannot afford to repay a debt. Disadvantages of government-backed mortgages: Some government-backed loans come with a mortgage insurance premium, which can cause higher borrowing costs. USDA Loans USDA Loans are the ones issued by the United States Department of Agriculture. They are zero-down-payment mortgages for those who can’t afford a traditional mortgage. If you’re looking for a home in a suburban or rural area and you’re interested to know what types of mortgage loans are available, a USDA loan is a perfect choice for you. USDA loans are issued through the USDA Rural Development Guaranteed Housing Loan Program, and there are three main types: Loan guarantees: The USDA guarantees a mortgage issued by a participating local lender, allowing buyers to get low mortgage interest rates. In some cases, they don't even have to make a down payment; however, they will have to pay a mortgage insurance premium. Home improvement loans: These loans allow homeowners to repair or upgrade their homes. Direct loans: These loans are reserved for applicants with very low income, and interest rates can be as low as 1%. Different types of mortgage loans have different income limits you need to fulfill to qualify, and when it comes to USDA loans, those limits vary by location and household size. To become eligible for the USDA loan, you need to: Have US citizenship or permanent residency. Agree to a monthly payment (principal, interest, taxes, and insurance) that’s around 29% of your monthly income. Have a reliable income for a minimum of 24 months. Maintain a good credit history for at least 12 months before applying for a loan. FHA loans FHA or 203k loans allow you to buy or refinance a home that needs work by letting you pay for the renovations over time and roll the renovation costs into the mortgage. FHA loans are considered a type of mortgage loan for bad credit, as you can qualify for it with a credit score as low as 580 and a down payment of 3.5%. FHA loans are issued by the Federal Housing Administration, and they usually offer more relaxed qualifying requirements than other renovation loan types. They do, however, include rules on how much money you can borrow and how you can use it for renovating a property. There are two categories when it comes to FHA loans: FHA limited loan and FHA standard loan. The limited loan provides up to $35,000 for renovations but can’t be used for major structural repairs. A Standard loan is for renovations that cost at least $5,000, including major structural repairs. As both types of FHA mortgage loans have specific requirements, let’s see how you can qualify for them. You need to have a credit score of 580, although some lenders even allow a score of as low as 500. If your credit score goes above 580, your down payment will be 3.5%. On the other hand, if your credit score is between 500 and 580, your down payment will have to be 10%. Your application will probably be denied if you had a foreclosure within the past three years. Max loan amount depends on the state and the area you live in, but it usually goes from $356,362 to $822,375 for a single-family home. VA loans When talking about what types of mortgage loans are available, we need to also look at the VA loans. These are loans issued by the Department of Veterans Affairs, and it has lower interest rates than most other types of loans. You can even buy a home with a $0 down payment. VA loans are for current and veteran service members and their spouses. In cases of VA loans, the government is the one that guarantees for the borrower and will repay a portion to the lender in case the borrower is unable to do so. If you have served in the military and are now checking out the best types of mortgage loans for yourself, a VA loan might be just what you need. Here’s what makes you eligible for a VA loan: You are a military member of a veteran that fulfills length-of-service requirements. To check these requirements, you can visit the US Department of Veterans Affairs page, which has detailed explanations. You meet the minimum requirements for credit and income issued by a lender. Although VA doesn't set a minimum for the credit score, lenders can set their own standards. If you don’t meet the requirements, you might have to check what other types of mortgage loans are there. You're the spouse of a service member who died while on active duty, and you have not remarried after December 16, 2003, or after turning 57. This also applies to surviving spouses of veterans who are missing in action or became prisoners of war. The property you're planning to buy will be your primary residence, and it meets the safety standards.
NASA continues its tradition of supporting US entrepreneurs in developing tech innovations ready for commercial use. NASA’s Small Business Innovation Research (SBIR) program continues that pursuit with its latest set of 140 Phase II rewards for 127 small businesses. A total of $105 million in funding will be awarded to businesses located in 34 different US states and Washington, DC. The program aims to find the most practical technologies for the National Space Agency and the commercial marketplace while including diverse entrepreneurs. Among the companies listed in Phase II funding, there are 33 businesses owned by women, minorities, and veterans. For example, the Salt Lake City-based company, InnoSys Inc., is a woman-owned small business developing a solution for operating cameras in harsh, extremely high-temperature environments. The innovation from InnoSys has both space mission applications and provides a means of imaging fires, inspecting nuclear reactor cores, or furnaces operating at high temperatures. With NASA’s assistance, InnoSys can focus on commercializing its product. If Phase II proves successful, the agency can provide further funding to find potential customers besides NASA. “The Phase II contract period is an exciting time, as small businesses put their ideas into practice and develop prototypes attractive to NASA and private investors. The selected technologies have displayed great potential impacts for their respective sectors, and we are proud to continually invest in today’s booming aerospace economy through these small businesses,” Jason L. Kessler, a NASA SBIR Program executive, stated. Some of the other exciting projects include a compact heat exchanger for possible electrified aircraft propulsion, an AI-powered virtual medical expert, and many others. Working on innovative tech is a demanding process, and our team recommends small businesses use cloud storage services to better coordinate product research and development. After all, a promising small business needs every advantage to secure funding from organizations such as NASA.
After rising dramatically in March, US retail sales stalled in April, despite expectations of a stimulus-check-related increase. However, as the economy reopens in the following months, an upward trend should reemerge. The US Department of Commerce said on May 14 that the unchanged retail numbers in April were still below predictions made by Reuters and Dow Jones. The new agency and stock market index forecast a jump of 1.0% and 0.8% in the sector, respectively. One of the reasons for this optimism was the $1,400 checks US households received in March as part of the $1.9 trillion COVID-19 pandemic rescue package. What’s more, pandemic household savings amount to an estimated $2.3 trillion, which should have helped lay the groundwork for spending in 2021. In March, the surge of consumer spending influenced the first quarter’s base for expected high growth in the second quarter. However, retail sales - excluding gasoline, cars, construction material, and food services - have dropped by 1.5% in April, after a 7.6% rise in March. Also known as “core retail sales,” these transactions represent the biggest component of consumer spending. This growth stop and slight drop indicate that households directed the government funds they received primarily to day-to-day needs and outstanding expenses, instead of regular shopping. The current shortage of workers slowed hiring in April, while low sales further hampered the economic recovery. Even though more than 37% of US citizens are fully vaccinated against COVID-19, the fear of the pandemic, combined with underwhelming wage offers from employers, is keeping workers at home. Here at SmallBizGenius.net, we remain optimistic that economic recovery is on the horizon. However, without proper support during recovery, such as business-friendly banking services, the question remains how the retail sector will manage this latest hitch in the recovery effort.
Less than 3% of approximately 30 million small-business owners in the US could be impacted by President Joe Biden’s tax increase under the jobs and infrastructure plan.The tax rate increase from 21% to 28% will not affect small businesses organized as “passthrough” enterprises. Limited liability companies are the biggest representatives of passthrough entities, and also account for nearly all small businesses. Therefore, most of them will avoid this hike.What’s more, most small-business owners are single earners. Out of that group, the only ones who will feel the proposed increase are people and married couples with more than $452,700 and $509,300 in annual income, respectively.This potential result is in line with the goal of the new corporate tax rate. After all, President Biden is counting on the support of small-business owners in this matter, as the actual target of this plan is large corporations. The White House seeks to increase the corporate tax rate by 7% to 28%, which would be significant primarily for large corporations like Amazon and Walmart. National trade groups, like the Business Roundtable and the US Chamber of Commerce, are vehemently opposed to the proposed change.According to a White House official, the tax plan should help eliminate the practice of offshoring profits and jobs while paying lower taxes than small businesses, present at many multinational corporations.Republican lawmakers are opposed to the proposal and remain unmoved by the small-business plight. The official White House stance is one open to compromise. According to the official, President Biden “was in the Senate for almost 40 years and understands how the legislative process works, and there is going to be a little bit of give and take with Congress, so that's the part of the process we are in right now.”Even though tax changes won’t impact most small businesses, these business owners will still need to stay on top of their tax obligations. They can do so by using tax software to automate the preparation process and meet filing deadlines.
Texas-based accounting and bookkeeping company GrowthForce has announced the launch of its "Guide to Outsourcing Your Back Office: Bookkeeping and Accounting," a comprehensive article for business owners that explains how to manage finances better and increase profits during various stages of business growth.GrowthForce invites its clients to answer a few simple questions to find out if they should outsource their business’s bookkeeping and accounting tasks. The aforementioned guide provides tips and tricks about how to make the most from outsourcing services.Due to the COVID-19 pandemic, businesses are taking the necessary steps to improve risk management strategies and reduce their costs. According to PwC, outsourcing “will be the go-to business strategy of 2021.”More and more businesses are adopting new strategies, including outsourcing bookkeeping and accounting services in order to save money and time, and to increase flexibility. One of the main benefits of outsourcing these services is that businesses can get support from experienced accounting and tax professionals at any time they need.GrowthForce’s guide to outsourcing back office tasks helps business owners learn: How to manage small business finance; How to track and recognize business needs during the different stages of the business lifecycle; How different types of outsourced bookkeeping services work; What the main benefits of full accounting services are; How to choose the right outsourcing company; What are the best approaches in small business bookkeeping outsourcing."Outsourcing financial operations offers a flexible solution for business owners who want to focus on growth. Seventy percent of businesses seek outsourcing to help cut costs, and almost half adopt outsourcing to increase flexibility," said Stephen King, GrowthForce’s founder and CEO.King is known as one of the industry’s most experienced leaders and speakers at helping businesses and nonprofit organizations increase their growth. As the founder of GrowthForce, King focuses on providing an automated accounting service that is effective and accurate for clients.