Business Performance

Your business’ assets are one of its greatest strengths. They support your day-to-day operations, can collateralize a loan, and could manufacture inventory. It’s important to track and account for them accurately.

Fixed assets are easy to identify - the computer sitting on the desk, the office chair, the inventory in the warehouse. They appear on the Balance Sheet and you book depreciation against them. But intangible assets can be harder for a small business to identify and track.

Often overlooked, intangible assets can be just as important as physical assets, if not moreso, for some businesses. Most business owners should have a working knowledge of intangible assets and how they impact their business.

What are Intangible Assets?

Intangible assets are assets that you can’t touch. They’re not physical in nature. Examples of intangible assets include:

• Goodwill
• Patents
• Trademarks
• Copyrights
• Licensing
• Intellectual Property
• Brand reputation
• Research and development results

Goodwill represents how others view your business. It’s your brand name’s value, customer reputation, and employee relations. Patents, trademarks, and copyrights represent the value of the inventions you’ve developed or purchased the rights to produce. If your business manufactures items with others’ logos, characters, or other licensed properties, you likely have licensing deals. Intellectual property is similar in nature, though you may not have filed for formal protection of it.

Some businesses, such as General Mills, manage multiple brands. In this case, the reputation of each brand is an intangible asset. If there was an issue with food poisoning, for example, with one brand it would tarnish its reputation.

All of these items relate to either your business’ or product reputation or the results of intellectual work performed by your employees. You invested money in creating them, whether by paying employee salaries or conducting studies, and will want to have a strong grasp of their value.

Why do Intangible Assets Matter to Your Business?

Intangible assets have value, and a reduction in their value could impact your business. The loss of a patent could increase competition, reducing what you can charge for your product. If your brand’s reputation suffers, sales could drop.

Most businesses test their goodwill on an annual basis. It’s important to note that it’s only booked on the Balance Sheet through an acquisition or merger. The amount only changes if the carrying amount exceeds its fair value and it becomes necessary to book impairment.

Unlike goodwill, intangible assets are regularly reduced through amortization. Amortization reduces their value by a fixed amount on a quarterly or annual basis. An accountant can help you determine the correct amount to amortize based upon the asset’s expected reduction in value over time.

These assets become particularly important if you are selling your business or investigating a potential merger. The acquiring company will want assurances that these assets have value, as they will be included in the purchase price. 

Identifying Intangible Assets

Identifying, valuing, and perhaps impairing goodwill can be a complicated process that is best performed by an accounting professional. It involves examining hard data, such as sales, customer retention rates, to determine the fair value of a reporting unit. Soft data can be gathered through conducting customer satisfaction surveys,

To identify intangible assets relating to patents, trademarks, and copyrights, conduct an internal audit of these areas. Your legal counsel should have copies of these, and any licensing arrangements, on file.

Finding intellectual property could require a deeper dive, particularly in software or technology companies. Audit your employee agreements to ensure that your company retains the rights to anything they develop while employed with you. Look at the invention and creation capture process, as well as attribution of inventions and invention ownership agreements, to find any intellectual property that your company needs to protect.

Depending on your business, this could be an involved process or a simple one. Once identified, put a process in place to both track them and identify new intangible assets as they become relevant.

Protecting Intangible Assets

Having robust contracts surrounding the development on any IP protects you from legal issues in the future. Employees in research and development, your software and IT groups, and other risk areas should have signed contracts clarifying ownership rights to anything they develop at your company.

If you have outsourced any of your IP development, such as hiring another company to assist with software development, make sure that their contract specifies who owns the final result.

Protecting patents, trademarks, and other registered intellectual property could involve tracking expiration dates and renewing them, as possible. Making changes and improvements to existing products can also help you extend your patents. Consult an attorney for help in planning how to protect these assets.

For smaller businesses, managing your brand and company reputation could be as simple as tracking and responding to online reviews. Larger companies often invest in PR management and have an individual or team in-house dedicated to managing it.

Identifying, tracking, and protecting your intangible assets may not have been a priority when you were a start-up, but now could have a significant impact on your future operations. Taking the time to do it now will pay off in the future.

Maximizing customer value is an important part of maintaining and growing your business. Your customer value proposition is what keeps existing customers happy and brings in new business. Without a clear value proposition, you may have difficulties marketing yourself to new customers.

So, what if your customer value proposition? And how do you maximize it for better results?

What is your Customer Value Proposition?

Simply put, it’s what you offer your customers that differentiates you from your competition. It’s why they should select your product or service over another option. You could base your value proposition on any of the following:

• Convenience
• Speed
• Quality
• Service
• Product Features

Your customer value proposition generates value for your customers, it often underlies your marketing efforts and helps you convince them to switch to working with you. If you’re struggling to identify it, ask yourself why someone would pick your product or company over a different offering.

Maximizing your Customer Value Proposition

The more value you offer your customers, and the more benefit there is to selecting you as a partner, the easier it will be to retain and attract new customers.

Offer More than One Way to Maximize Value

Perhaps you’ve relied on a high-quality product to keep your customers happy, but you have slow delivery times. The reality is that a customer could leave you for a slightly lower quality product if that company can deliver it faster. It’s important to look for other areas where you could increase your company’s value. 

For convenience - how easy is it to reorder or book any appointment? Can a customer do it all online, or do they have to wait on hold? A simple investment in an online ordering portal or appointment scheduler could not only increase their satisfaction but save you overhead.

The same principle applies for collecting payments. If you’re still sending invoices through the mail and receiving paper checks as payment, think about adding an online payment portal to your website.

In some businesses, the speed with which you deliver your product or service can be extremely important. It could cost you, or your customer, a lost sale if there are shipping delays. If you’re often out of stock of an important product, which causes delays, ook into better inventory management software. If the delays happen in shipping, consider switching shipping carriers or asking about expedited options.

Layering value on top of your existing value proposition maximizes the total value you offer your customers.

Customer Service and Experience

It’s harder to track how customers feel about the service you offer, but there are ways that you can gauge it.

Start by monitoring your online reviews and respond quickly to any negative feedback. Try not to get defensive, instead, read between the lines to see if there are real issues that you could address. Maybe they’re complaining about a slow email response time when they needed help, but you know the slow response was because someone was out of the office. Cross-train employees so that more than one person can answer questions.

Customer returns are another way to identify a problem. If you’re seeing a high volume of returns on one item or product, it could indicate quality issues. Examine returned items for any product defects, keep an eye on your manufacturing process, or suppliers, and perhaps offer incentives to dissatisfied customers to make up for the inconvenience.

Another way to get a handle on the value your customers receive through service and experience is to look at customer referrals. A large volume of customer referrals indicates that people are happy with your offerings. If referrals have been steady, and are now dropping off, dig deeper to find out the reason why.

Add Product Features

In the midst of running a business, it’s hard to conduct market research and keep an eye on competitors. But failing to do so could leave you behind when they release new product features or enhancements.

Regularly check competitor websites and their blog to see what they’ve added to their products or plan to add. When you’re monitoring customer feedback, pay attention to requests for new features or changes to your existing products. If enough people say the same thing, it’s a sign that you should invest in developing that enhancement.

Acting proactively to add product features shows customers that you’re listening to what they’re saying and thinking of their needs.

Maximizing your customer value proposition requires you to first identify what you offer customers, get clear on your existing value, and then think of ways to improve it. It could take a bit of trial and error if you’re unsure what areas of improvement your customers would view as offering them the most increased value. But in the long run it’s worth it to support your business’ ongoing operations and growth.

Its year-end review time at many companies. Instead of dreading it, or worrying about giving negative feedback, why not turn it into a chance to improve morale and engagement? You can do this by including a professional development plan with your review.

Losing employees impacts your bottom line. You could have to hire a recruiter to find their replacement, there will be lost productivity while you train the new person, and if they have been disengaged for a while you may find that their past work wasn’t up to par.

It costs U.S. companies an average of $4,000 to hire a new employee, and it takes an average of 24 days to find them. During the COVID-19 pandemic it may be even more difficult to find and train new talent, particularly if your office is working remotely. There are many benefits to working with your existing talent.

Keeping employees engaged both ensures a productive workforce but also saves you time and money. A professional development plan is one way that you can retain and develop current employees - it tells the employee that you’re invested in their future. You want to see them succeed and are taking steps to encourage growth. If they see a path forward in their career at your organization, they’re less likely to start applying for jobs outside the company.

What to Include in a Professional Development Plan

Many companies include the employee in preparing their professional development plan. This gives them a higher level of buy-in and ensures that their goals align with the company’s needs and growth.

When working with an employee on a professional development plan, you’ll customize it to their career goals. However, each bullet point, section, or paragraph, will address the following components.

Concrete Goals

Most people who write reviews are familiar with the goals acronym SMART - Specific, Measurable, Actionable, Realistic, and Time-Based. After getting clarify on where an employee sees their career heading - Human Resources Officer? Head of Production? - draft goals that meet these criteria to help them succeed.

Relate each goal to the employee’s overall career trajectory. Even if they find social media interesting, it wouldn’t make sense for an accountant who wants to become a Controller to study digital marketing.

Define Goal Achievement

The plan’s content should specifically address each of their goals and lay out a roadmap to help them achieve them. It’s not enough to write - I want a promotion to manager by next year. How will the employee prepare themselves for that role?

Do they need to learn a new software system? Perhaps they’d benefit from job shadowing or training. Set milestones along the way that both give the employee something to work towards and also tell you when they’re ready for that next step.

Include Experiential Learning

For many, if not all, roles, it’s important that someone actually perform the work to fully learn a new task. When writing the professional development plan, include milestones where your employee can practice new skills.

This could be role-playing an encounter with a confrontational customer, or actually using new software in a sandbox environment. Pay attention to how they do in these situations, and use your observations to determine where they might need to improve or if they’re ready to progress to the next goal.

Expose Them to New Situations

Not everyone knows where they want to go in life, particularly new college graduates. Giving them the opportunity to job shadow, or participate in a mentorship program, could help them find their path.

If the employee has expressed interest in working in a different department, pair them with someone interested in mentoring. Alternately, many senior level employees find being a mentor rewarding. It helps them identify and promote talent within the organization.

For employees who know where they want to go, the opportunity to learn from others can prepare them to try on a new role. If someone else is ready to move up, they could train a junior level person into their responsibilities. It’s also beneficial to have a back-up for important tasks if someone is out of the office.

Provide Ongoing Education

For some skills or roles, experiential learning or training may not be enough. The employee may need to learn a new software program, take a class in data analytics, or obtain a professional certificate. If this is the case, include these milestones in their plan.

This could require a financial investment by the company, so be sure that you have the resources available in your budget. Whether it’s paying for part or all of a program, your human resources department likely has policies around ongoing education and reimbursement. Check with them before finalizing these steps in the plan.

While a professional development plan does require more work from managers during the review process, it’s worth it to both retain and engage talented employees.

As any bookstore owner who’s heard a customer say, “That’s okay, I’ll order it on Amazon,” when a book is out of stock can tell you - supply chain management can make or break a small business. Supply chain management is the flow of input materials, finished goods, or services, through your business. It’s particularly important for businesses that produce or carry physical inventory. 

For a manufacturing company, it could involve the complex balance of ordering raw materials so that they’ll arrive in time for manufacturing to fulfill orders. A restaurant may need to carefully manage produce deliveries to avoid costly spoilage. 

For small business owners who haven’t thought much about supply chain management, shipping and delivery issues during the pandemic have probably helped you realize its importance. Here’s are some of the benefits to thinking about it, and tips on how to improve your processes. 

Benefits to Thinking About Supply Chain Management

Here are some of the reasons that small business owners should think about supply chain management.

Minimize Costs

One of the biggest benefits that you can realize from effective supply chain management is minimizing costs. By addressing expenses that don’t add value to your product you can increase your profit margins. Two of the biggest areas where supply chain management can help you control costs are transportation and warehousing.

If you fail to include a crucial part with your order, you may have to pay rush shipping so machines don’t sit idle. A supply chain manager also might be able to negotiate better rates or work with carriers to shorten delivery times. Taking advantage of shipping discounts, or bundling orders to lower costs, all impact your bottom line. 

Transportation impacts production, but also warehousing. If you order too far in advance, raw materials could sit in a warehouse until they’re needed. You’ll have to pay storage costs. 

The same principle applies to inventory that you sell-through. Yes, you need that book on the shelves or in your back room, but not six months before you anticipate demand. Supply chain management often goes hand in hand with effective forecasting. 

Increased Profits and Efficiency

Lower costs lead to increased profits when you sell the final item, both when you cut transportation costs but also reduce the time that materials and inventory spend in a warehouse. 

When the necessary materials are available as needed, your production process becomes more efficient. You can get orders out the door faster and more efficiently, increasing inventory turnover. Which leads to satisfied customers. 

Increased Customer Satisfaction

Remember that example of the customer who just ordered the book from Amazon? Failing to have the right stock on-hand, or fulfilling orders slowly, can cost you customers. On the other hand, quick order fulfillment increases customer satisfaction and loyalty. 

Tips to Improve Your Supply Chain Management

Convinced that you should think more about how your business gets the supplies it needs to keep going? Here are two areas where you could easily make improvements.

Learn about Your Suppliers

How well do you know the businesses that supply your plants? If you’ve subcontracted or hired brokers to manage supply, you might not have a good handle on your suppliers and costs might have crept up over time. It’s worth the effort to get to know them.

When you take an inventory of your suppliers, ask the following questions:

• Where is this supplier located? Is there a company closer that could supply this material? (Transportation savings)

• What’s the average delivery time from this supplier? Is this hurting my production timelines?

• Why would I pick this supplier over a different company? (quality, service, discounts, speed of delivery).

• Does this supplier have the production capacity I need? 

• Could I consolidate suppliers and order the same materials from one company instead of three? 

The answers to these questions could help you identify where changes need to be made. 

Digitize Your Supply Chain

The days of walking up and down warehouse aisles with a pen, paper, and clipboard are gone. If you’re still manually tracking your supply chain, digitizing could immediately yield rewards. 

Investing in software that tracks forecasting, production, and logistics, making connections between them, can show you where you can streamline production. Maybe forecasts are too low, and you’re having to order extra supplies at random times, which drives up shipping costs. Software that compares real-time and historical data helps you plan better. With the click of a button, you can calculate average delivery speeds and identify a supplier who’s lagging behind. 

If you manage a lot of SKUs - whether its parts or inventory - or a lot of suppliers, moving to a digital platform could quickly improve your supply chain. And any area where you can improve your business will have an impact on your net profits and efficiency.

Did you know that your business has a credit score? It’s similar to your personal credit score - it tracks missed and late payments, if you’ve defaulted on loans, and your business’s assets and liabilities. But unlike your personal credit score, it’s not compiled by a credit bureau. People pulling your business’ credit score most commonly pull it from a company called Dun and Bradstreet.

Dun and Bradstreet, often referred to as D&B, is a commercial credit agency that’s been around for over 150 years. They track credit information for subscribers who can pull data on your business when deciding what payment terms to offer or whether or not to give you a loan. When your business is new most lenders will look at your personal credit score when making lending decisions. But as you grow, your business’ credit will become more and more important.

Understanding your Business Information Report ™ can help you identify why a vendor is extending their payment terms, or a bank has denied you for a loan. If your report doesn’t contain much information, you can proactively start to build your profile to obtain better rates and terms in the future. 

Performance-Driven Scores on Your D&B Report

Your business’ past performance drives two scores on your D&B report - the D&B PAYDEX score and the D&B Rating. D&B calculates these scores based on data gathered about your business’ history.

D&B PAYDEX SCORE

This score assigns a rating of 1 to 100 for your business. It’s an overall assessment that looks at your last two years of history. D&B looks at how many vendors you do business with then drills into each payment agreement and the overall size of the relationship - i.e., how much you pay them.

The higher your score, the better, but you also get points for exceeding expectations. An 80 would mean that you paid vendors on time, but to earn a 100 score you should pay all vendors 30 days before the bill comes due. If you pay bills late, your score will drop. The later the payment, the lower the score.

Not all vendors report their payment data to D&B, which can impact your score. For example, the small bakery that supplies your weekly bread delivery probably doesn’t notify D&B when you pay a bill late. But the large, multi-national produce company probably does.

If you’re struggling paying bills on time and have to choose between vendors, and also want to build or maintain a high D&B score, prioritize bills to larger companies. Also, the larger the relationship, the bigger the impact it’ll have on your score.

D&B Rating

This is one rating that you might be missing, or have a lower score, if you don’t register with D&B and provide them with your financial statements. That’s because D&B bases this rating on your net worth as calculated off your financial statements, as well as your overall condition. 

Without financial statements, they base your score on company size, industry, or other related factors. After you register for a DUNS number, which is a unique number assigned to your business by D&B, you’ll be able to submit your statements. 

Predictive Scores on Your D&B Report

Based on the scores above, and the data that D&B analyzes to prepare those scores, D&B then tries to predict your future behavior. D&B looks at the past 12 months of historical payments to predict how you’ll act in the future. 

Delinquency Predictor Score 

This score ranges from 1 to 5, with 1 being the best score. A high score indicates that you’re extremely likely to pay your bills late over the next year. If you were trying to open an account with a new supplier and they saw that you had a bad score on your report, they might not extend you credit. 

The Financial Stress Score 

This metric also ranges from 1 to five, with a score of 1 being the best. It’s an indicator of potential financial distress. Financial distress could be a difficulty paying your bills, a low current ratio, or rapidly rising debt levels. 

The Supplier Evaluation Risk Rating 

Unlike the other predictive scores, the supplier evaluation risk rating measures your risk on a scale of one to nine. One is the best, and indicates a low likelihood that your business will shut down or go out of business in the next year. 

Building Business Credit

As you grow and expand, your D&B report which contains negative information could limit your growth potential. If suppliers are unwilling to extend terms, or a lender won’t approve a loan, you could end up stuck. It’s important to start thinking about your business credit early in your company’s life. 

One of the first things you can do to start building your credit is to open a business checking account and register your business with the state. This makes you look more official. Secondly, registering with D&B for a DUNS number sends them the signal to begin tracking your business’ activities. And lastly, pay your largest and more important suppliers on time or early.

What if you already have a score, and isn’t good? The good news is that even if you have a poor D&B score right now, it’s fixable in a much shorter timeframe than a personal credit score. Your personal credit score takes up to ten years of information, but just a year of making on-time payments can boost your D&B report considerably.

With a little bit of work, you can ensure that your D&B report will improve your company’s future.

Do you know how much inventory is in your warehouse right now? If the answer is a shrug, you would do well to learn about inventory management. Businesses which rely on the sale of physical goods must learn how to manage the flow of those goods in and out of their warehouse. 

What is Inventory Management?

Inventory management refers to how you handle the physical items that your business manufactures or orders and then sells to customers. For a retail store, it could be dresses, for a manufacturer it could be widgets. But if your business has physical stock on hand, managing it could become the key to your success.

Why does Inventory Management Matter?

If you’ve ever had the experience of telling a customer, “I’m sorry, that’s not in stock,” and then watching them go to a competitor, you’ve learned the importance of inventory management the hard way. Failing to properly manage your stock on hand could lead to either lost sales or cash flow issues.

You need to make sure that you have the products you need on hand when they’re needed. Some customers may be willing to wait while you order a widget, but others may go down the street and never come back. Poor inventory management could cost you money.

It could also hurt your cash flow. If you’ve bought or made too many of one product and it sits in your warehouse the money you spent on that inventory isn’t available for other things. It’s tied up in excess stock. This means you lose out on the opportunity to find something your customers might like better, or which might sell faster.

The ultimate goal of inventory management is to cut the cost of carrying unsold inventory and maximize sales. 

How to Manage Your Inventory 

Whether you track it in a spreadsheet or buy specialized software, you’ll need to perform some or all of the following steps to manage your inventory.

Keep Track

If a customer calls and ask if you could overnight them ten computer parts, do you know if you have that many in your warehouse? To properly manage inventory, you must have accurate counts of what you have available to sell at all time. This is called “real time” inventory management.

For businesses with low inventory turnover, it’s possible to track using a spreadsheet or inventory log. You’ll have time to count and subtract in between orders. A business with high turnover might want to invest in software with SKU and scanning capabilities.

A component of keeping track is counting inventory. For tax purposes, you’ll need to do this at least once a year. 

Forecast Demand

Do you know how many parts you’ll need to fulfill orders next month? Part of inventory management is forecasting future needs so that you can place order or ramp up production to have enough stock to meet future orders. 

It’s important to try to prevent product shortages, which also involves predicting the raw materials you’ll need to order for production. If your supplier has a three month lag time, you’ll need to place your order with enough time to get the raw materials into your shop in time to make product to fill orders. 

Inventory management and forecasting can get quite complex. If your supply chain is dependent on several variables you’ll need to develop robust forecasting tools. Developing accurate forecasts also prevents you from having excess stock sitting around. 

Organize a Warehouse or Storage

It’s impossible to have an accurate inventory count if you don’t know where it’s stored. If your system says you have five wheels in stock but you can only find three of them in your back room, you can’t sell the other two. 

Wherever it is that you store your products, it should be well-organized and labeled. This will also save you labor hours. Employees who can quickly locate an item can pack and ship an order faster, or bring it out from the back room and complete the sale. 

Set Minimums

If you have a consistent seller, a core product, or a raw material that you must have on hand at all times, consider setting reorder minimums. When you set a reorder minimum level in your software it will automatically notify you to reorder something when your stock is getting low.

This can prevent costly production delays. Having safety stock on hand also means you can get that sale. 

Be Accessible to All Staff

Can any retail employee look up your stock on hand and immediately answer a customer’s question? Whether it’s through a handheld device or a point-of-sale, your business could require making your available inventory counts available to all staff.

If this is the case, it’s unlikely you’ll be able to use an old-fashioned spreadsheet. Inventory counts should be accessible to every employee who might need them. Even in a less-complex business, if only one person has access to the file and they’re on vacation, what then?

When choosing how you’ll manage your inventory, and which system to use, think about who might need to access it and when.

While setting up a system for managing inventory could require an investment of time initially, it’s worth it in the long run. When your accountant asks for a reconciliation of your electronic records to a physical inventory count there won’t be any surprises. You can keep customers happy and manage your cash flow at the same time.

Whether you’re big or small, putting together a PR strategy pays off in multiple ways. A press release that a reporter turns into an article could send new customers to your door. Having a good reputation in your community strengthens your business’ sales and longevity. And good relationships with the media result in free publicity and building your reputation as experts in your field.

Public relations is building and maintaining a positive public view of your company. Unlike sales and marketing, businesses do not pay for good PR. Whatever the form it takes, it’s freely given by a newspaper or blog. Because of this, consumers tend to view positive PR as being more credible than paid advertising.

Here are four tips to help you build a successful PR strategy for your business.

Know your Markets

It would be a waste of time for a wholesale industrial cleaner manufacturer to send a press release to a mommy blogger. Part of a savvy PR strategy is knowing your market, both in terms of the customers you’re trying to reach and the media outlets where they can be found.

If you’re trying to identify the media your customers consume, start with your community. Who are the customers you want to reach? Are they new moms, or the buyer at a multinational corporation? Identifying this market may require reaching out to your sales and marketing department, or going back to your original business plan.

While identifying this market, always keep in mind how your company benefits them. How do your products or services make their lives better? This will help you when writing press releases or when giving quotes to media outlets. After identifying the market you’re trying to sell to, find the media they consume.

What news outlets do they share on their social media feeds? Where have they been quoted? Make a list of websites, news publications, blogs, or other media channels where you find your customers. These are the people you can target with your PR efforts.

Send Press Releases

A press release is a short, usually one-page, description of a major event in your business that you can send to the local newspaper, an industry publication, or a local influencer. Its contents and where you send it will depend upon your business’ size, product or service, and size.

For example, if you’re opening a new old-fashioned candy store with a soda counter and old-timey glass jars, you might send a press release to the local paper and a local mommy blogger. If you’re a small to mid-size start-up who just secured another round of funding, email your press release to both the local newspaper and an industry publication.

Include relevant details that readers might want to know, such as the new candy store’s location and hours of operation, but try to focus more on the story you’re telling rather than giving a list of facts.

Did memories of going to the local ten cent candy shop with your grandfather inspire your new store? Tell that story. Think of what customers would want to read and the value you bring them, and highlight that in your press release.

Be Responsive to the Media

 It’s Halloween and a local reporter has reached out looking for a quote for a piece she’s writing on the most popular candy for trick-or-treaters. This is a great opportunity for the owner of that candy store to build a good relationship with that reporter and to bring more attention to her business. Always respond to media requests, even if they don’t directly plug your business.

A quick quote about which candy is selling fast this year may not plug your business directly. It could just have a tagline of, “says Ms. Smith, owner of Good Time Candy Store in Weymouth, Massachusetts.” That tagline, however, reminds readers of your store, which is particularly invaluable if it’s a local paper.

Building good relationships with the media ensures positive coverage of your business. They may be more likely to turn one of your press releases into a story. If you can become known as a credible source for industry-related pieces, it can generate a lot of free publicity.

Think about adding a press or media page to your website. Make it easy for the press to find contact information and other details about your business. Include details like the year you opened, biographies of important people in your company, links to past press releases, and your brand story. If other pages on your website have a more folksy or informal feel, keep this page more professional.

Cultivate Word-of-Mouth

A key component of public relations is your reputation. PR isn’t just getting the word out about your business and its accomplishments or products, it’s also building a positive image of your business in the public eye.

Solicit testimonials from satisfied customers or clients. You can add these to your website or social media feeds, and ask them to post them on online review sites. Construction companies often ask homeowners to put signs in their yard - “garage or new windows by” and their name that might inspire neighbors to ask about their work. Brainstorm ways to get the community talking about your business. 

Larger companies may want to think about commissioning case studies. A case study narrows the focus to one client’s problem and tells the story of how your business helped solve it.  Typically longer than a blog post, it’s an in-depth look at the benefits you brought to one customer. Your PR team can send the case study to media outlets, and your sales team can use it with potential clients.

For many companies, personnel and personnel-related costs represent the biggest chunk of their expenses. During this pandemic, companies of all sizes have had to take a closer look at their personnel costs to see where cuts can be made. This has resulted in millions of people losing their jobs. But what if there were alternatives? Maybe your company doesn’t need to lay off as many people as you might have thought, in order to survive.

1. Switch Full-time Employees to Part-time

Consider making non-essential employees part-timers rather than full-timers. To be fair, you’ll probably have to offer a part-time wage that is higher than what you’d normally pay a part-time employee. But because they’ll be working fewer hours—less than 30 hours per week—you’ll end up paying less. A word of warning, though. As a rule, salaried employees aren’t required to get overtime pay rates when they work more than 40 hours per week. But if your part-time employee works overtime, most states have laws that require you to pay them time and a half or more. This strategy also requires more hands-on scheduling, a time clock system and keeping a close watch on potential overtime issues.

2. Implement Temporary Salary Cuts

It’s not easy to ask valued staff to take a salary cut, but if the choice is between being laid off or taking a temporary cut in pay, most employees will choose the latter. If you decide to go down this path, first get together with your CPA to determine exactly how big of cuts you’d need to make in order to make a big enough difference. Then you’ll need to internally determine how you’re going to spread those cuts out among staff. The best—and safest in terms of legal ramifications—is to implement salary cuts as a straight percentage, where everyone shares the same percentage. The actual numbers will vary because of different salary amounts, but no one will be able to say you acted discriminately.  

3. Transition Into Temporary Staff

Depending upon the nature of your business, you may be able to take advantage of using temporary staff and letting go of at least some of your permanent staff. A move like this is best suited for seasonal businesses where there are marked surges and lulls in business. You’d bring in temporary staff during surges and rely on a skeleton crew of permanent staff during lulls. Another benefit of using temporary staff is the relief from the burden of paying insurance benefits.

4. Offer Unpaid Leave

Some of your employees might appreciate taking leave, even though it’s unpaid. It feels like a big ask from an employer standpoint, but keep in mind that many of your employees may have working spouses and families. In cases like these, they may relish the chance to spend some time at home with family, working on private projects or taking care of extended family needs. During the unpaid leave, you’d save on payroll and payroll taxes. Make sure you put the deal in writing—ideally with a definitive return date—so that you don’t inadvertently lose a valued member of your team.

5. Restrict Expense Accounts 

Expense accounts are an often-overlooked personnel cost that is usually easy to curtail. Bear in mind that employees who pay for company expenses out of pocket can still take the tax deduction on their own personal taxes, so it’s not a huge burden for employees. You’ll lose the deduction on your business taxes, but you’ll also lose the expense, which will help your bottom line.

6. Suspend Fringe Benefits

Fringe benefits are another small but significant personnel cost that can be temporarily eliminated or reduced when you need to. For instance, you can stop paying for gym memberships. (Employees might not mind if they can’t visit the gym anyway due to COVID.) You can stop stocking the company kitchen with beverages and snacks. Instead, install vending machines and encourage employees to bring in their own snacks. You can stop leasing the employee-of-the-month parking spot. For the sake of employee morale, plan on bringing back fringe benefits when finances allow.

7. Freeze Reviews and Raises 

Employee reviews are always eagerly anticipated because they usually mean a pay raise is also forthcoming. But when cutting personnel costs, you’d do well to freeze both reviews and raises. Freeze both because employees shouldn’t have to sit through a review if you aren’t offering a raise to with a positive review. And, you can’t review a bad performance just because a raise isn’t justified, either. Again, assure your employees that these are temporary measures designed to keep the business flush.

8. Temporarily Decline Your Salary

A drastic, yet effective way to cut personnel costs is to decline your own salary for the interim, just until you can get over the financial hurdles. You’ll be able to save on the salary itself and the payroll taxes. Just be sure to consult with your CPA about the best way to handle this, since the IRS frowns on salary “manipulation” in order to avoid taxes. This isn’t what you’d be doing, of course, so your CPA can help make it all above-board.

9. Reduce Retirement Contributions 

Retirement contributions are a huge benefit that can help your company to attract the best talent. But when times are tough and you have to choose between the health of your company’s finances and the retirement accounts of your employees, this could be a place where you can save money. If you temporarily reduce retirement contributions, your tax deductions will decrease, but you’ll be able to have more operating cash for inventory, marketing, client management and more. Again, be sure to consult with your CPA to determine if this is a viable option for your business and if so, how much to reduce them.

Letting staff go permanently during the pandemic is a drastic measure that solves a short-term problem with a long-term plan. Instead of resorting to such measures, consider one or more of your other options, as outline here.

Companies large and small are struggling in this age of COVID. In Chicago alone, an estimated 4,000 small businesses have shuttered. The Washington Post reports that over 100,000 small businesses nationwide have “closed forever.” And it’s not over yet. Is your business struggling to stay afloat? Before your business becomes part of these alarming statistics, take action with some of the following cost-cutting ideas. 

Slash Marketing Bills

The age of social media and the plethora of available DIY marketing tools make marketing the first place you should look to for cutting costs. Businesses of all sizes can market alongside the “big boys” for pennies on the dollar with a few strategic moves. Here are some ideas for marketing on a budget:

• Start a free Facebook business page. Post timely and informative content for your existing and future customers. If you can’t afford to pay a writer, post shared content from other places that you think will add value for your readers.

• Start a free Hootsuite account to post across Twitter, Instagram and Linkedin. The convenience of having access to all these social media accounts on one dashboard will save your admin person countless hours. 

• Share short videos on Facebook and Instagram. Let your followers see behind the scenes at your company. The videos only need to be a couple of minutes long and you can use any smartphone to record the action.

• Cut print advertising. Print advertising isn’t dead yet, but the return on investment isn’t what it used to be. Most people consider printed mail flyers junk mail, and fewer people read actual newspapers than ever before. Community coupon books aren’t great value either, as you’re competing with all the other businesses in your local area. 

Downsize Offices

With a little reflection, you may find that you don’t need as much office space as before or at least you might be able to economize with space. Pull out your lease and see if the early termination fee is bearable compared to the money you’d save for the rest of the year. Don’t forget to factor in the actual cost of moving, too. If you can’t get out of the lease or the numbers don’t work, consider subleasing a portion of your office space to a smaller company. Even if subleasing isn’t allowed in your contract, talk to your landlord. They may be willing to make a concession for you, given the current economic climate. 

Negotiate Prices With Vendors

Call up vendors and see if you can get a price break, even if it’s just temporary. Most vendors will be willing to help if they can in order to keep your business. If they can’t give you a temporary discount, consider asking for longer payment terms. At least if you get that, it will help with your cash flow. If that’s out of the question, you might have to start shopping around for less pricey vendors. Keep that as a last resort, since changing vendors is risky; you might find yourself in a worse position than you were with your old vendor. 

Install a Programmable Thermostat

If you’re running an actual office with employees, it’s highly likely that the area around the thermostat is as busy as the water cooler. In offices around the world, employees are jacking the thermostats up and down; sneaking over to turn it back up when it’s been lowered and vice versa. This wreaks havoc on energy bills. It’s worth it to pay to have a company come out and install a programmable thermostat. Program it yourself within reasonable parameters and then cover it with a thermostat lock box to prevent wild fluctuations by employees. 

Get Comfortable With Telecommuting

If you were one of those employers who was against telecommuting before COVID, it’s time to get more comfortable with the idea. The biggest worry was that employees would spend more time snacking in front of the TV than taking care of business at home where there would be no one looking over their shoulders. But if you can’t trust your employees to get their work done at home, then how can you trust them at all? And, if an employee who telecommutes takes advantage, you’ve got cause to dismiss. So really, there’s no risk on your part, and a lot of benefits. If you allowed everyone to telecommute, you could give up your leased office space and all the other added costs that go along with it, including your own fuel to go back and forth, utility bills and more. 

Cut Office Hours

If telecommuting just isn’t an option for any reason, consider cutting office hours. Few people will complain about getting to leave earlier or being able to take Mondays or Fridays off. You could close the office on those days and outsource a receptionist service to answer any calls that come in. You’ll save on energy bills and on pay for any non-salaried employees. 

Sell Equipment

When things are dire and you need to stop the money bleed as of yesterday, consider selling some of your equipment. You might be able to bring in some cash by selling surplus computers, monitors, chairs, desks, printers, etc. Advertise on your local Facebook marketplace, Craigslist or eBay. This is a big step for drastic times, but it is an option for businesses that are really in financial trouble.

Don’t wait until it’s too late to let your CPA know that you’re struggling to make ends meet. Your CPA is a valuable resource for cost-cutting measures and tax strategies that can make the difference between staying in business and closing doors for good. The earlier you identify a problem and consult with your CPA, the more cost-cutting options you’ll probably have.

The skillset most managers develop over time often relates entirely to managing in an office. Stopping by a direct report’s desk to check in, scheduling one on one meetings or taking them out to coffee to catch up on their progress. If they have a question about a line item on the Cashflow Statement, you can teach them how to find the answer by walking them through your accounting software and Balance Sheet. 

With the coronavirus pandemic, almost all offices shifted to remote work. You sent your employees home on a Friday with a laptop, and might not have met with them face-to-face in months. To be an effective remote manager requires taking the skills you used in the office and applying them differently.

Focus on Performance, not Hours

For many workers, one of the biggest advantages to working remotely is the ability to flex their time. If they need to take fifteen minutes in the morning to run a quick errand, they can. During the pandemic, employees are balancing work and distance learning. Breaks consist of helping a fourth grader with their math homework.

Insisting on maintaining a regular, nine to five, day can be very stressful. While employees should still make conference calls and Zoom meetings, as a manager you need to understand that the work they’re producing matters more than the hours they work. Some couples have created switch shifts, where the husband takes the kids in the morning so mom can work, and they switch in the afternoons.

The obvious exception would be if you bill clients for hours worked. Even then, expect that an auditor may sign in at 10 p.m. to finish their day’s work.

Establish Clear Expectations

Do you need that report by Friday at 3 p.m.? Your employee is not a mind reader, so make sure they know your deadlines. To manage effectively when you’re not in the office, set clear expectations. Make sure that your team knows what you need from them, and when. Having clear deliverables empowers employees to arrange their own schedule, supporting the goal of focusing on performance.

If you’re both new to working remotely, go slow at first and don’t overload them with work. There is an adjustment period - even if it’s as simple as getting used to working on one screen instead of two. Prioritize the work you’re assigning so they can focus on the most important tasks first.

Check in Regularly

But not too regularly. After all, if you’re texting, direct messaging, and emailing several times a day, you’re interrupting them as they work. Some people struggle with completing their tasks if they’re constantly pulled away from them and then must re-focus on what they were doing.

You will have to find the balance between regular communication and being hands-off that works for both you and each direct report. Keep in mind that it could vary by team member. Younger generations dislike communicating by phone and prefer text or direct messages. If you’re struggling to figure out how to communicate with a particular person, make yourself available through multiple modes of communication and pay attention to which mode they gravitate towards.

A good rule of thumb is to maintain routines established in the office. If you previously held a one on one every Tuesday at 10 a.m, keep up this routine but via a Zoom call. Weekly team meetings can continue, just not in an office.

Solicit Feedback on Your Management

While many managers are comfortable offering feedback about job performance, they can find it hard to solicit feedback on their performance. Asking your employee how you’re doing as a manager can feel like an awkward role reversal. But involving them in the process of developing a work from home strategy increases their sense of ownership and buy in.

With the pandemic and shelter in place rules, you might have been shoved into a work from home situation with little time to prepare. Both you, and your employees, are figuring it out as you go. Asking them what is and isn’t working for them could lead to workflow improvements that work for all of you.

Now is not the time to manage authoritatively. Doing so could alienate your team and lead to them looking for work elsewhere. Fostering a sense of “we’re all in this together” will keep your team functioning in harmony rather than seeing themselves as individual contributors. After soliciting feedback, listen to what your team says and put their suggestions into action.

For example, if a team member mentions that it’s very hard to have meeting times changing constantly because they’re also scheduling calls with their child’s teacher, make it a point to stop rescheduling as much.

Pay Attention to Employees’ Emotional States

A boss is not a therapist, it’s true, but it would be a mistake to completely ignore your employee’s emotional states. One of the biggest downsides to remote work is that workers often express loneliness. Given that the pandemic forced the situation, they could also be dealing with anger or resentment.

In the office, if someone snaps back or sends a curt email you may give them the benefit of the doubt. They could be having a rough day, or the baby is teething and they didn’t sleep last night. When your team is working from home you don’t have that insight into their daily lives.

Try to remind yourself to continue to not react poorly but rather investigate when you worried about a team member’s job performance or tone. Open the door for them to communicate about their emotions as the pandemic had dragged on. 

To manage remotely, you may just have to shift your skills and apply them differently. It will make you a better manager - both in and out of the office.