Does your business have online presence?

86.8% of Canadians today are considered “internet users”, and this number continues to grow year after year. That means that approximately 30 million Canadians have used the internet within the last 12 months. The internet is such a powerful tool because it can be used for so many different reasons. Average Canadians use the internet to: surf the web, shop, find out the news, search up articles, play games, and use social media. Let’s focus on shopping; consumers are not only using the internet to shop, but as a tool that helps shoppers figure out what product(s)/service(s) that they want.

What better way can business owners reach their target customers then to have their information readily available 24 hours a day, 7 days a week?  With the technology era in full effect, people are going online to: educate, communicate, and communicate. So how can businesses take advantage of the internet and help it grow their business?

1. Google. How does your business rank in Google? When someone is searching for your product or service, will they find you at the top of the first page? When Google users perform their searches, they usually find the result they are looking for on the first page. If your product or service does not appear on the first page you may be losing out on critical opportunities.

How can you fix this? There are several way to approve your ranking on Google, some will cost more than others. Here is a list of some online tools you would want to look into:

• SEO (have an expert optimize your website so that Google can recognize its content)
• Adwords (an easy way to be seen in Google searches)
• Social Media (Facebook, Twitter, LinkedIn, You Tube, Google+)
• Blogging (share your expertise and opinions with the online community)

If you use these 4 tools effectively, your business should see an improvement in website traffic as well as an increase in sales. Ultimately, driving traffic to the website will spread the name of the business and help build the brand.

2. Reviews/Testimonials. Reviews are great for consumers because they are proof that the product/brand has been purchased before and unbiased opinions from those that have used it.  For businesses that do not have a history of reviews or testimonials, it is hard to prove their legitimacy without showing a history of business.

Testimonials and references are important for any business that is looking to change suppliers or manufacturers. Because it directly affects businesses, it is important to make sure that current clients are thoroughly satisfied with the products/services they currently receive.

3. Feedback. Feedback on your product or services is a great way to see what is working well and what can work better. Improvement and innovation are crucial for the future development of businesses. While not all feedback is positive, it is important to listen to your customers so that they do remain your customers.

4. Business Directories. Business directories not only display contact information, they are a great source for business leads when people are looking for certain types of industries. While phone books have been used for decades, most directories are now offered online (Yellow Pages, 411, Google). It is a simple way to have all your contact information available as well as a link to your website with products/services.

While businesses do not require a website to succeed, if you are looking to drive new customers and growth, it is important that your business can be found when companies are doing their research.

Thanks for reading!!

Michael Wong
Able Business Credit
Vice President - Business Development
416-909-2369
mwong@ablebusinesscredit.com

Why does Factoring send off Red Flags? A Popular Misconception..

Factoring is still a relatively new financing method within North America, and business owners still do not understand what factoring is. While it is a popular and accepted practice in the UK, it has been slowly growing in the United States and Canada. As it becomes more increasingly difficult to get approved for a business loan, many entrepreneurs are left in cold with very few options available. This is where factoring may be the best solution to help free up cash flow while payments are being made. In this blog I will attempt to educate not only business owners, but all individuals who do not fully understand what factoring is.

By Definition; factoring is a financial transaction where the business sells its accounts receivable to a factor at a discounted rate. Businesses use factoring to improve their cash flow so that they can use the working capital to pay off expenses and continue to grow the business.

Here are some of the concerns that have been raised by business owners:

1. Business owner to supplier relationship; many business owners choose their suppliers based on the relationship they have with them. It is no secret that business owners become more sceptical when they find out that their supplier is now using a factoring company to chase their bills. They see factoring as a weakness rather than an opportunity to expand the business. But in reality, factoring is a very quick source of financing that basically gives business owners access to cash that will eventually be theirs.

2. Business owners believe that their customers might leave if they find out they’re factoring. This is one of the most difficult obstacles for entrepreneurs to overcome; they are so worried that factoring will scare their customers and lose out on business.  While there may be a few owners that think this way, large corporations deal with factoring company’s everyday because they understand the financial stress of 60 day credit terms. And if businesses are THAT worried about having a factoring company call their customers; non-notification is an alternative where the customer would never know.

3. Interest rates; while factoring receivables is more expensive than a bank facility, it is meant as a short term solution when cash flow becomes tight. If you are only factoring in 3-6 month intervals, the interest incurred over that period is not significant. Most businesses that use factoring services do so until they are approved for bank financing. Factoring companies are not in the market to compete with financial institutions but instead partner with banks when they are not approved for a line of credit.

Let’s not forget, while most Canadian banks do not have a factoring department (National Bank of Canada being the exception), they do provide ABL (asset-based lending) services. While these services are being applied in a different process and at lower rates, the mechanics are essentially the same. While factoring continues to gain acceptance in the North American culture, it is important for business owners to be open to the idea of working alongside and with factoring companies.

Feel free to send me an email at mwong@ablebusiness.com with any questions or comment you have on this post.