4 Exit Steps Every Business Owner Should Know

Business.com
4 Exit Steps Every Business Owner Should Know

Long-term planning is key for any business, and having an exit strategy within those plans is a must. This applies even if your business is in its infancy. After all, everyone wants to retire quite comfortably.

An exit strategy is your way of leaving the business and doing so in a profitable manner. But how do you go about this? These four steps should make life easier.

1. Always plan well ahead

First, you must plan your exit strategy from the outset. This helps shape the way your business unfolds. There will be a day when you plan to stop running the business. It’s better to leave the business voluntarily, rather than an exit being forced upon you, and preparation is important.

Some experts believe you should start planning years before you actually leave the business, while other business owners insert it into their original business plan. It's important to know when you will leave the business, the path your business will follow to get to that point and whether your idea is to sell or pass the business to someone else.

2. Consider the negatives

This isn’t easy, but you must also plan for bad things to happen. It’s a fact of life that an unfortunate event can occur. Whether it's an illness, a death or even a natural disaster, you need to think about every scenario. Nobody knows what lies around the corner.

The best approach is to have various business insurance policies in place should an exit strategy be forced upon you. What would happen if your location was destroyed by fire? What if an integral member of your team became ill or died?

Preparaing for these events helps prevent you from losing everything. Study your insurance policies or seek advice regarding the different clauses. Look at policies where business debt is covered should something bad occur or polices that allow you to exit the business without being left in trouble. With luck, you never use it, but knowing it’s there is good planning.

3. Be aware of new owners

You should also become aware of the potential new owners of your business as part of your exit strategy. Again, this helps you determine the direction your business will head in. Your aim is to reach a point where you can move the organization under someone else's control.

Generally, there are three options available.

First, you may wish to pass the business to someone in your family. Identify who will inherit the business, and check that they want to do it. Discovering that nobody has an interest in taking over the operation can be devastating if you're unaware until you start seeking an exit.

A second option is to sell the business to people within the company. This may be to an individual or a group, and the good thing about this option is they already have the expertise to take the business forward. Of course, you must know who will take over and prepare them for it in advance.

The final option is to sell to an outside party. With this, you want to know their plans for the business before agreeing to the sale. Also, identify the party with time before the sale, as you want to avoid a rushed affair. You don’t want to sell to the wrong person.

4. Get the best value

If your exit strategy is to sell, offering the best value for your business is key. Much like buying a luxury car, you must look beyond the sales figures and make your business an attractive proposition, even if the goal is selling the business to current staff members. Remember, current staff members may understand their section of the business, but they will not know about every aspect of running the company.

The company's value should include a healthy income, having a variety of clients, a low staff turnover, a detailed management structure and a host of other factors. Your business must appear to be a well-oiled machine where a potential new buyer can move in and keep things running with only minor adjustments.

If your business offers real potential, then finding a buyer is easy. Of course, you must build your business in the right manner to get to that point. 

Having an exit strategy in place is something all business owners need. Seeing the end goal and continually working toward it can give you the drive you need to succeed. Being unprepared increases the chances of a disastrous exit, which may cause you to lose everything, and that is a crying shame. Plan ahead to enjoy your retirement after putting in the hard work to build up your empire.

How Will Blockchain Impact Digital Marketing?

Blockchain technology is rapidly moving in on many industries. While it’s usually discussed in the financial and banking realm, there are many implications of blockchain outside of traditional markets.

According to Statistica, in the telecommunications, media, and technology sector, blockchain research is well underway. Of this group, 40 percent noted they are in the awareness phase or becoming educated on the technology. Thirty-nine percent said they are experimenting with blockchain or creating proofs of concept, and 12 percent are already deploying blockchain technology and using it in their business.

Since blockchain is so synonymous with finance, many wonder how marketers would even use this technology. Is there a place for blockchain technology in marketing? It turns out, yes, there is. Blockchain has the ability to change how marketers collect and use data, how they address customers and how they manage ads. Here’s a look at the impact blockchain will have on digital marketing.

Tracking keywords

Tracking keywords is a challenge for marketers. First, search engine algorithms change often enough that marketers continuously have to change course. Second, tracking keywords on different devices and trying to decipher a local versus a national search is problematic. Organic SERP results are incredibly complicated to understand, and many marketers have to guess or assume when creating reports.

Using the blockchain, marketers could have real numbers when keyword tracking. A tracker built on the blockchain could account for all of the inconsistencies that marketers currently have to account for when summarizing efforts. This type of technology could track keyword positions across all devices and in any location. Marketers could then use this information to create more data-driven, accurate campaigns.

Changes to social media

Companies such as Sociall are changing the way users think about social media. This decentralized network allows users to share, discover and connect without the traditional social media surveillance. Another platform called WildSpark, the first tool released by Synereo, offers its users “a new way to pay attention.” They essentially monetize viral content with the idea that only the best, most popular content will climb the ranks. To quote the website, WildSpark “is a platform agnostic Attention Economy layer situated on top of existing social media hubs. WildSpark allows content creators and curators to benefit directly from the value they generate online.”

These social media changes benefit users in that users can have more control over their data. They also reward users for good content or viral content. For marketers, this changes a lot. First and foremost, marketers must assess how relevant these decentralized social networks will become and whether or not their customer base will use them. Second, brands have to offer absolutely full transparency.

While some marketers fear that they will lose out on data collection since it’s relatively easy to collect data from the current social network giants, it will simply change the way marketers get leads.

Marketers net better leads

Currently, data collection for marketers takes a varied approach. Many collect data from a variety of sources, put it all together and run a campaign based on that. This method is not great, and many campaigns are then run off of inconsistent or incorrect data.

Since blockchain transactions are decentralized, marketers have to go right to the source for data collection: the consumer. Marketers can pay or incentivize consumers for their data. While this is a higher upfront cost, likely the ROI on the campaign ran off this data will be higher. This way, marketers have accurate data that came right from their consumer.

Consider this: Consumers that give the brand their data are likely already interested in the company. This makes lead scoring and conversions in the funnel much easier because these are already prospects ready for nurturing. So yes, it will be more effort and cost upfront, but marketers will gather far better leads using the blockchain.

Combating fraud in the ad space

As marketers know too well, there is frequent click fraud in advertising. AdChain is a company trying to combat this with adChain Registry, a smart contract on the Ethereum blockchain. Ad impressions and clicks are authentic because they’re on the trusted blockchain. The company wants to solve the problem of the lack of transparency and the high levels of ad fraud. The platform provides end-to-end transparency for all data, which does not exist in the traditional ad space today.

More transparency for consumers

Many blockchain technologies ultimately provide more transparency for consumers. They know who has their data and how those businesses got the data. For marketers, there will be more data to run campaigns. Though marketers may have to pay for incentive data collection, the information will be real and highly usable in campaigns. The marketing industry is seemingly just beginning to adopt blockchain technology, but the possibilities and implications are endless.

4 Tips for Improving Your E-Commerce Security

The internet is full of good people who just want to do business with your e-commerce store -- and that’s great! However, the internet is also full of unsavory people looking to take advantage of online shops just like yours.

It has been predicted that between 2016 and 2020, e-commerce fraud loss is going to be around 3.2 billion dollars. That’s nothing to shake a stick at. You need to do everything in your power to protect your online store from falling victim to malicious scammers and hackers. We are here to show you how to a build and maintain a secure online small business. Learning how to beef up your e-commerce store security can save you money, increase customer satisfaction, and help you grow as a reputable online business.

Know the Warning Signs of Fraud

The first, and perhaps most important tip, is making sure you know the warning signs of fraud before and as it’s happening. Being aware of fraud involves you to be vigilant and constantly monitor data that going to and leaving your website. You have to not only protect your business against cyber attacks but ensure that people are not using stolen credit cards on your website for fraudulent behavior.

Once you recognize the signs of fraud, you’ll immediately begin to pick up on suspicious behavior when sifting through data. Here are some common signs that someone may be trying to use your site for fraudulent or otherwise shady behavior.

Multiple payment methods coming in from the same IP address. This can be a sign that someone is using stolen credit cards in order to purchase products from your website. Two or three payment methods could be the result of multiple people in the same household. Shipping address in one country while the billing address is in another country. This is especially true if the shipping address is in the US and the billing address is a place known for scammers. Large quantities of products purchased from your website -- especially if it’s a new customer. If someone randomly signs up for your website and makes thousands of dollars worth of purchases right away, it’s a sign that fraud could be afoot. Track and Educate Employees on Passwords

When a hacker gets into your website, chances are, it happened because they were able to crack the password of one of your employees. How do they do this? Typically, they use bots to generate letter/number combinations in order to crack into the account. You can stop this from happening by making sure you are always making complicated passwords while educating your employees on the importance of a strong password.

Most strong passwords have numbers, letters -- both capital and lowercase, and a symbol. You should always make sure you guys are changing your passwords often. The Better Business Bureau recommends that you change your passwords once a month.

Use a Third-Party Payment Processing Plugin

There’s no quicker way to lose the trust of your customers than by having their accounts compromised because you left their payment data on your website.

If a hacker manages to get into your website, you can recover. If you have customer data on your website and the hacker gets tens of thousands of payment methods from your customers, your business can potentially shut down for good. No one is going to trust your company because they were burned by your lack of security.

Luckily, there is a way for you to protect yourself and your customers. You can add a third-party plugin to your site to handle payment methods. They often either delete the information as soon as the order is processed or hold onto it in their secure server.

Back Up Your Website Data

Most people tend to back up their computer in case they run into a virus, or a serious crash occurs and they are unable to boot their computer normally. You should take this same advice and apply it to your e-commerce store.

Not only will this ensure that your website is safe and secure, but it also includes a host of other benefits. Exporting your data is a breeze, and you’ll be able to back up your data if something goes wrong with a third party add-on.

These are just a few ways you can make sure your e-commerce store is secure. As your website grows in size, you’ll need to increase your security. Bigger businesses are a larger target for scammers, hackers, and fraudsters. If you take the time to secure your website you can look forward to a healthy, profitable e-commerce store. You’ll have happy customers, get more sales and have some serious peace of mind.

3 Tips to Increase Affiliate Marketing Sales

There are plenty of great ways to make money while working online. One of the ways that has grown in popularity is affiliate marketing. While affiliate marketing was once viewed as an obscure way that very few could use to make money, things have certainly changed.

Many big-name companies like Amazon are happy to work with people who want to promote the products they sell. Let's take a look at how it works. You own a website that features content as well as links to products on another website. Let's use Amazon again for an example. The customer follows your unique link and makes a purchase on Amazon. Since they followed your link, you receive a cut of the money. Running an affiliate website takes plenty of time, work and knowledge. We are here to help with the knowledge.

A Business Insider study showed that 16 percent of all sales online are completed through affiliate marketing. We are here to bridge the gap and show you how to increase the sales of your affiliate marketing site.

Build a reputation and brand

If you don’t have a strong brand backbone and don’t appear trustworthy, you’re probably not going to see much traffic or profits. You must build your brand up before you start seeing sales from your affiliate marketing site. There are plenty of ways to appear as a strong, reputable website.

First and foremost, you should start by having a social presence. Create social media accounts, cultivate followers and likes through your marketing and core content.

While writing content, make sure you link to other reputable sites so that you not only appear to know what you’re talking about, but you also will start building strong links with well-known companies, and that reflects well on your brand. 

Create content with value

Generally speaking, you have to create content with value. Think about the questions people may ask about topics, what products help solve the problem, then make the connection between the problem and how the product solves the issue.

Let’s say your target is health and wellness. You decide you want to sell products that promote muscle growth. A common question people might have is how to achieve maximum muscle growth. You could just say “This product will increase your muscle growth. Buy it.” But that wouldn’t get you many sales.

Instead, explain how muscle growth happens inside your body. Talk about the process and what ingredients help cultivate healthy muscle growth. Instead of pushing the product you’re trying to sell front and center, link the ingredients in the product to your content about healthy muscle growth. You’re building the connection, teaching your readers something new, and giving them a practical reason why your affiliate products are worth their time.

Build your email list

People who buy from your links once are likely to continue buying from you. You should always work toward building a strong email list. You get the added benefit of having an audience to try out additional product advertisements on as you publish more content. It’s a worthy endeavor regardless of the type of business you operate.

How do you build an email list? Most people are not going to actively look for a way to join your email list. But if you put the opportunity in front of them, well, that’s a different story.

According to a case study by OptinMonster, adding an exit-intent not only converted an additional 17.31 percent more customers, but it also increased the revenue of an affiliate marketing site by a staggering 30 percent.

Exit-intent is a type of popup that predicts the user’s behavior and causes a popup to occur before they leave the page. You can make the popup say whatever you would like. In most cases, you’ll probably want to say something like, “Want more great content and recommendations?” followed by a box for the user to enter their email address.

If you put the option in front of the customer, they are proven to be more likely to subscribe, which helps boost your overall sales.

The bottom line

There’s no doubt room to grow in the affiliate marketing world. If you use these tips on your website, you’ll stand a much better chance at finding success regardless of the niche you decide to pursue.

Don’t get discouraged if you’re not swimming in sales overnight. Building a quality affiliate site takes time and patience. These tips are designed to help you get over some of the initial hurdles so you can increase your sales and see success for yourself.

MIT Sloan Management Review

Because of big data — a term that has come to refer to the immense amount of digital material we generate, store, and manipulate with increasing ability — managers can measure more about their companies and then use that information to drive performance. Need to heighten the productivity of your workforce? Big data can help. Want to analyze customers’ preferences and purchase patterns? Big data can do that, too. Looking for ways to cut costs and increase profitability? Big data: At your service.

But not all companies are flourishing in this new era. Small companies are struggling. Over the last three decades, the annual rate of new startups has fallen from 13% to less than 8%. During that time, the percentage of employment at companies with fewer than 100 workers has decreased by 5%. Meanwhile, big companies are thriving. The share of revenue of the top 5% of businesses has increased by 10% since the 1980s. Large companies also employ a greater share of the U.S. labor force: from one-quarter in the 1980s to about one-third today. What accounts for this discrepancy?

My colleagues — Juliane Begenau of Stanford University’s Graduate School of Business and Laura Veldkamp of Columbia University Business School — and I had a hunch that one of the likely culprits was big data. Our reasoning: Investors rely on big data to help them make smarter investment decisions. Because big companies produce more data relative to smaller companies, investors have more information to go on. This wealth of data, in turn, accelerates advances in processing speeds and computing and helps investors view these large companies as a less risky bet. As a result, big companies get more than their fair share of financing at better terms and are therefore better able to prosper. Smaller, younger companies, by contrast, receive less financing, which hampers their ability to grow.

To test our hypothesis, we developed a noisy rational expectations model to demonstrate how big data influences the evolution of company distribution. Our model calculates the different availability of data in small and large companies and then looks at how that data interacts with the growth of processing power.

To understand just how rapidly it has changed, consider these striking facts: Data processing power has grown about 20% per year since 1980, where our research begins. In 1992, the average computer processor speed was 0.05 GHz. In 2005, that number was 3.6 GHz.

Our model also analyzes the evolution of the cost of capital over time and calculates the risk and return trade-off of financing a company about which little is known. We find that improvement in processing power has favored the risk-return trade-off for large companies with a wealth of data, and their cost of capital has fallen considerably. The findings are clear: Big data disproportionately advantages large companies over small ones.

Intuitively, this makes a lot of sense. Big companies have more economic activity and longer company histories, so they have more data to process. Meanwhile, all the computing power in the world cannot inform an investor about a small company that has a short history and fewer disclosures.

The problem, though, is that as big data technology improves, large companies will continue to draw a more than proportional share of data processing and financing support.

Advances in information technology have already exacerbated this trend. Faster processing speeds have enabled investors to crunch ever more data — macro announcements, earnings statements, competitors’ performance metrics, export market demand, anything and everything that might conceivably forecast future returns — in a matter of seconds. More data processing lowers investor uncertainty and thus lowers the cost of capital for big companies. Smaller companies can’t hope to compete.

Three Recommendations for Preventing Big Data Inequality

So, what can be done to fix this situation? For starters, managers of small companies need to be made aware of this inequality and its impact on their ability to access capital. A shift in mindset is required. Startup founders and small business owners must begin to think about their data as a new class of economic asset — like gold or oil. They need to understand their data helps investors learn about and assess them — which, in turn, helps them raise financing at lower costs. An abundance of data is a valuable asset; a dearth of data is increasingly seen as a damning liability.

Second, investors need to know that their bias toward data-rich companies means they are missing out on some potentially lucrative opportunities. After all, a vast body of research shows that startups and small businesses are often more productive, more innovative, and have better growth prospects than larger companies.

Finally, policy could be potentially helpful here, too. While our model does not analyze the impact of policy interventions, it’s important that lawmakers recognize the fact that the explosion of big data does not equally benefit all companies. One possible remedy would be to create incentives that help small companies generate more data so they can attract financing.

The promise of the big data revolution is evident. But we must better ensure that all companies can reap its benefits.

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