Article Contributed By Dr. Alan R. Zimmerman
When it comes to customer loyalty, nothing is more important than the trust you develop with your customers. Research from Texas A & M University says if customers see you as being trustworthy and reliable … and if customers see you fulfilling your promises … then they will become enthusiastic customers for life.
The same is true with your co-workers. If your employees see you telling the truth, even when it’s not easy or comfortable to do so then you’ll build an incredible bond of trust with them. And with that bond of trust will come more cooperation and motivation.
The lesson is clear. If you want your customers to remain loyal, you must earn and keep their trust. If you want a stronger team at work, you have to build a foundation of trust.
So trust is your ultimate competitive advantage.
Now, how do you build or re-build trust?
4 Ways to Build Trust, Gain Loyalty & Retain Employees and Customers for Life
1. Assume the best about your employees and customers
When something goes wrong, or when the other person disappoints you, start by assuming the best. Don’t immediately jump into the fray, pound your desk, froth at the mouth, and demand to know why your employees or customers did something so stupid.
Instead, honor the other person. Rather than focus on WHO’s to blame for what went wrong, focus on WHAT can be done about it. That takes the focus off the past and off the other person. It puts the focus onto the future where the two of you can work together.
Besides, if you jump in too quickly, blaming someone for what happened, you’ll often embarrass yourself. You may find out that you’re really the one to blame for the problem that occurred.
2. Stick up for your customers or employees when they’re in the right
You build trust when you speak out on someone’s behalf, especially when it’s not politically popular or interpersonally comfortable. Martin Luther King, Jr. said, “In the end we will not remember the words of our enemies but the silence of our friends.”
I’ll never forget the time I chaired the task force of a charitable organization. Over a period of time, it came to my attention that the organization had misused funds on several occasions. My task force members urged me to confront the Board and document my findings. They would be there to back me up.
I did that, but not one of the task force members backed me up when the top leaders lashed out in defense and aggression. If nothing else, I learned that Dr. King was right. It was the silence of my “friends” that I remember the most today.
3. Refuse to gossip
There’s something very alluring, and maybe even a little satisfying, about sharing a negative tidbit. It may make you feel a bit superior, but you’ve got to fight the urge to add to the gossip and the people bashing that may go on in the company cafeteria or behind a customer’s back. You just can’t do it.
The reason is simple.
Negative gossip almost always gets back to the person you are discussing. That’s just the nature of juicy, negative, sensationalized news. And to make matters worse, the version that gets back to the person you discussed is almost always worse than the version you shared.
4. Keep your promises
Nothing destroys trust faster than failing to keep your promises.
Think about it. No one ever forgets a promise. You tell your child you’ll take her to the amusement park, and she’ll remind you fifteen times that “you promised.”
You tell a colleague that you’ll get back to him, and he sees it as a promise. You tell a client, that an assignment will be finished by tomorrow and she sees it as a promise. And it doesn’t work to go back to them and say you forgot or you got busy. In their minds, you broke your promise, and the trust between the two of you is damaged.
So, if you want to build trust, the solution is simple. Keep your promises.
A final thought
Don’t get discouraged, if you’re in the process of building or re-building trust in a relationship. Trust takes time.
Just as it takes more than one block to build a fortress, it takes more than one action to build trust. It takes a lot of blocks, put down … over time … to get the results you want. It works the same way when you’re building trust. Go ahead and use the four trust building blocks I’ve just given you and you will:
– Become a better leader and manager
– Retain your employees – (Don’t forget … high employee turn-over = higher costs)
– Keep your customers who want to buy from you over and over again for life
– Achieve more than you ever thought possible
And, it’s all because trust is the “ultimate competitive advantage.”
About the Author
Best-selling author and Hall of Fame professional speaker, Dr. Alan Zimmerman has transformed more than a million people into better managers and leaders in the office and in the marketplace. For even more tips on how to build relationships with employees and customers that last a lifetime go to http://www.DrZimmerman.com and get his free e-book that’s filled with his most popular articles.
Author: Pamela Swift
Article Contributed by Mark G
A very rewarding endeavor could be buying a company that already exists. One of the primary reasons to buy an existing business is to avoid ‘start-up’ costs. The opening costs of beginning a new business venture can be astronomical, aswell as the costs of advertising, and all of this with no guarantee of making a profit on your investment. You will be able to see the track record of an existing business’ income and expenses. Giving you an idea of what you can expect.
There are quite a few legal things to take into account when buying a up and running business. Initially, you must make sure that you know exactly what you are buying. Have you decided to either acquire the entire business entity or simply buy its assets?
The assets you are planning to purchase, what are they? When making an asset purchase, it is of utmost importance to put in writing precisely what the assets are so once the transaction has
closed there aren’t any unforeseen issues. Make a list of the all the physically identifiable assets. For example a photocopier, list of customers, office furniture, etc.. You also should make the list of intangible assets, i.e. the email addresses, phone numbers of the current business. The inaccurate assessment of assets included in the purchase account for many of the business transaction claims that are raised.
Will a landlord agree to you taking over any lease agreements? For some companies the merit of the business includes an affordable lease agreement in a good location. If you are purchasing a business on leased premises, you will need to obtain the consent of the landlord prior to assuming the existing lease. This is almost always contained as a stipulation of the Agreement. When looking to lease office space, a landlord will require, at minimum, your credit history and information about your business experience.
What type of obligations do you have towards the Employees. You need to look and see if the business you are considering buying has a lot of full time or part time employees. If this occurs, you’ll be responsible as a subsequent employer for money owed to these employees, including wages, vacation pay, unemployment insurance premiums, and premiums from worker’s compensation. Your best choice when considering purchasing a business may be to hire all new employees. The reason is that there maybe a lot of obligations that may come with the existing employees. When buying a small business, some prefer to have a written agreement in which the vendor will terminate all employees before the closing of the deal.
What exactly are the Non-competition clauses? Many times buyers will hammer out an agreement with the seller, which limits the seller’s capability contend with them after settling in a similar business. If you decide to purchase a business, the last thing you want is the vendor opening a new shop just a few doors down from the original. If the seller is willing to incorporate a non-competitive stipulation at time closing, this possibility is eradicated.
Remember when considering non-competition covenants, they must not be overly restrictive, or you will not be able to enforce them. It could be a reasonable idea to limit another vendor from opening up a business that is similar to your own for 1 to 5 years following the closing of the deal, and due to these restrictions they must operate within a distance of 1 to 5 kilometers surrounding the present business location, depending on the type of business that is being
sold.
If the seller is unwilling to agree to such terms, it may be best to leave the deal for buying that business on the table and walk away. If you are thinking of buying a business that is already in existence, you need to find the time and effort to sit down with your local attorney. Over the long haul, it could possibly save you thousands of dollars and hours of time.
About the Author
Mark G is a writer and follower of developments in business sales market and broker industry. Visit his sites at canadian businesses for sale
and Quebec
businesses for sale.
Article Contributed by Joanne Black
Have your phones stopped ringing yet? The economy is lagging and dragging. We’ve felt the effects in the United States. Now we’re seeing global implications.
So, how do you tackle economic uncertainty?
Cut advertising, travel, training, marketing, and discretionary expense line items? Cut purchasing? Ouch!
The pipeline starts to dry up and the anxiety level goes through the roof. Many people think that since there’s nothing they can do, they should just do nothing. But “nothing” is futile thinking.
What If You Could Reach Your Market Without Incurring Any Hard Costs?
The only budget you need to worry about is your simply your time… your time to ask for referrals!
You know about referrals. When a qualified prospect is referred to us, we get a new client typically between 70 and 90 percent of the time. Additionally, we are pre-sold. Our selling time decreases. Credibility increases. And, we ace out the competition.
There is no other business-development process that can claim these results. Results are the only thing that matters. And, now you will be able to achieve results simply by implementing the following 8 “Killer” strategies.
8 “Killer Steps” to Attracting New Business in a Lagging Economy
1. Broaden Your Perspective
What business are you in? Redefine and reinvent yourself. Determine how you can create a leap in demand for your products and services. Build new alliances and consider alternate distribution channels. Don’t go solo. It’s important to assemble a group of advisors and get their input and creative ideas. Include people who have differing points of view from you. Not easy, but critical.
2. Be Nimble and Innovative
You’ll never have all the facts. Make quick decisions. Be fearless and make tough choices. Create new uses for your products. Why not a new business model?
3. Dazzle Your Current Customers
Your current customers need care and feeding. Don’t ignore them at the expense of new business, because they are your best source for new business.
4. Prioritize Wisely
The most important activity for any salesperson is to do what’s “closest to cash” the first thing every single day—whether it’s following up with a prospect, writing a proposal, or closing a deal.
5. Become an Expert
Companies hire experts because they can’t afford to make mistakes. Position your company as the expert with a specific product or in a specific market niche. Become an expert and people will be more likely to refer you.
6. Stay Connected
If you want to get more referrals you have to network like crazy. Attend a minimum of one event a week. You never know who you will meet and what you will learn. Never let your network go down. Networking is an essential referral marketing activity. So go make connections and build your business.
Talk to people and find out how you can help them. How is their business doing? Are they impacted by the lagging economy? How? Don’t email, call. You make connections by talking to people and by spending the time to have a robust conversation.
7. Don’t Cut Prices, Increase Value
There’s a lot of chatter about cutting prices in a lagging economy. Many small business owners think businesses are cutting back, so prospects don’t have money for their projects. But, by cutting prices, you’re cutting your profits even further. Instead, consider how to “get in and get started.” Divide your offering into smaller chunks, get results, and create traction. Or, give more value. When you offer high-value products and services, people will refer you and you will get more sales, even in a recession economy.
8. Commit to Building Your Referral Business
Referrals are always terrific, but they mean even more in a lagging economy. Don’t let the lagging economy trickle down on you. Take charge and make your phone ring again! Let your prospects know how much you care about them. Tell and show just how much you appreciate their business. Inform them that you’d like to help people just like them. And, don’t forget to thank your prospects and clients for their referral.
Follow these tips and you will get more referrals. You will attract new business. You will get more clients. You will accelerate your sales. And, you will achieve higher results without increasing your cost of sales. In fact, there’s a great chance that you will decrease your costs!
America’s leading authority on referral selling and founder of No More Cold Calling, Joanne Black helps salespeople, sales teams, and business owners get more referrals and attract more business fast without increasing costs. Now, discover how to turn prospects into clients more than 50 percent of the time even during a down economy with her Recession-Proof Your Business Emergency Kit at: http://www.nomorecoldcalling.com/products.html
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Private Limited Company Advantages
When considering the advantages of a private limited company registration against retaining self employed status the decision taken by a sole trader is often entirely focused upon the tax advantages. There are other private limited company advantages and also disadvantages particularly in regard to limited company accounts and administration compared to producing a simple set of sole trader basic accounts.
A private limited company advantages include:
1. Limitation of Liability
There is no distinction between business money and personal money for anyone self employed as all business debts are the personal responsibility of the sole trader. The private limited company advantages are that the company is a separate corporate body and liability for payment of debts stops with the pvt ltd company, the owners, shareholders are not personally liable. The directors are only liable if they continue to trade and incur liabilities after it becomes apparent the ltd company is insolvent.
2. Lower Taxes
Lower corporation tax offered a private limited company advantages over self employment in recent years. The £10,000 tax free limit was cancelled several years ago. Corporation tax rates have increased from 20 per cent to 22 per cent for small ltd companies over the last three years compared with the basic rate tax for a sole trader which has reduced from 22 per cent to 20 per cent Incorporation does still offer tax saving advantages dependent upon the net profit before tax.
The private limited company advantages come from the flexibility of being able to determine the proportions of salary and dividends taken compared with a sole trader whose basic accounts are subject to tax at fixed tax rates and thresholds.
A sole trader receives a £6,035 personal allowance and pays basic rate tax of 20 per cent on the next £34,800 of earnings up to the higher threshold limit and 40 per cent tax thereafter. Class 4 national insurance is 8 per cent of earnings up to the upper primary threshold and 1 per cent thereafter.
Dividends are taxed at 10 per cent on total income up to the higher threshold and 32.5 per cent above. The dividend is a distribution of company profit after corporation tax has been deducted and so the shareholder also receives a dividend tax credit from the pvt ltd company of 10 per cent.
There are significant private limited company advantages regarding tax liability compared to a sole trader where net income is below the upper earnings threshold.
For example assuming the limited company net profit before salary is £35,000. A sole trader would pay income tax of £5,793 plus national insurance of £2,317.20, a total of £8,107.20.
If a salary of £6.035 is taken and the rest is taken in dividends a private limited company would pay £6,372.30 corporation tax, after deducting the salary from net taxable profit and the sole trader now the shareholder would pay no income tax.
The advantages increase where net taxable profit is above the self employment upper earnings limit as money can be left in the business and therefore only subject to the 22 per cent corporation tax rate thereby avoiding the sole trader 40 per cent tax rate. Another possibility is to distribute the shares among family members to reduce the risk of 40 per cent tax.
3. Limited Company accounts and Sole Trader basic accounts
Sole trader basic accounts can be quite simple as a formal accounting system is not required and can be reduced to simple lists of income and expenditure supported by documentary evidence of sales and purchase invoices, effectively single entry bookkeeping. Producing a balance sheet is optional. Due to the simplicity then an accountant may not be required saving a significant cost.
Ltd company accounts have to use double entry bookkeeping to produce the year end accounts including a balance sheet with statutory notes and statements. Unless accounting software is employed to produce the company accounts in this format then accounting knowledge is required and an accountants fee may well be in the region of £500 to £1,000. An accountant is not essential for a small pvt ltd company but is the normal approach and offsets some of the tax advantages.
4. Additional financial considerations
Because a director is also officially an employee of the pvt ltd company this gives rise to a number of considerations in determining the extent of a private limited company advantages.
Pension contributions of a sole trader are personal and while may be deducted from the personal income liability do not form part of the basic accounts. The pension costs including any company contribution to a pension scheme by a private limited company is a deductible business expense as an employee cost.
Using a car for business purposes may have an impact. The sole trader basic accounts would include the business proportion of the vehicle running costs or the mileage allowance. If that vehicle is used by a director then that director is receiving a taxable benefit potentially resulting in a higher tax burden depending upon the type of vehicle as taxable benefits vary. An alternative may be to leave the company vehicle privately owned and the director claim mileage allowances rather than vehicle running costs.
Potentially small issues but there differences in the accounting treatment of deductible expenses such as charitable donations, entertaining expenses and use of home as office. A private limited company advantages consist of being able to claim such expenses as valid business expenses which would not be claimable in the sole trader basic accounts as treated as personal not business.
If the director and main shareholder have other associated companies then the corporation basic tax rate could be affected.
5. Administration, management and business standing
A sole trader basically pleases themselves with regard to the administration and management of the business. A company director is responsible for adhering to company administration according to statutory regulations in regard to both the limited company accounts, statutory books and management as stated in the articles of association. The duties of a director are more formal than a sole trader.
Forming a private limited company is an indication that a business is both serious, has a long term objective and is correctly managed. This psychological perception can increase the business standing of a business. In addition funding requirements are more likely to be met as the lender to a sole trader has to consider the absence of a balance sheet statement in the basic accounts and the financial influences personally affecting the sole trader. A private limited company advantages concern the published financial statements, protection of the financial position from personal influences and the option of increasing security by virtue of asking directors to provide additional personal guarantees.
A private limited company advantages over self employment also extends to long term finance. Companies tend to retain more funds within the business to meet future financial commitments which aids year on year growth, a more sustainable business and medium term profits growth over a sole trader.
Terry Cartwright qualified as a Chartered Management Accountant and Chartered Company Secretary in 1971. A successful business career followed as Head of Finance for major companies in the UK and several consultancy appointments. In 2006 he created DIY Accounting producing Accounting Software for self employed and small companies that use simple accounts spreadsheets to automate tax returns.
Value added tax is the tax amount added to the value of goods and services by a vat registered business when sold or transferred. Vat is not charged by businesses that are not registered for vat. This guide covers the vat threshold, accounting for value added tax, registration and submitting the quarterly vat tax return online
When the sales turnover of a business reaches the vat threshold, currently 64,000 pounds per annum until reviewed in April 2008, then registration for vat is compulsory. If financially beneficial, businesses can register for vat prior to sales turnover reaching the vat threshold.
When a business registers for vat it becomes responsible for charging vat at the correct percentage on every sales invoice and transfer of goods and services and also maintaining accurate financial accounting records of the vat charged hat are subject to vat inspections. If the sales turnover has breached the vat threshold that business is liable for the vat on sales even if it has not charged the customer.
The vat charged to customers is called output tax and the vat on purchases is called input tax. When a business has registered for vat in addition to maintaining records of sales and input tax it must also keep accurate financial records of purchases and input tax in order to calculate the vat payment to be made. The amount of vat to be paid each quarter is the difference between the sales output tax and the purchases input tax and is paid quarterly to HMRC.
Specific types of business transactions are exempt from vat such as insurance and loans. If the business only supplies exempt items then the business cannot register for vat to reclaim the input tax paid on purchases.
Registering voluntarily for vat when the sales turnover is below the vat threshold is a financial planning decision that each small business should consider. There are both advantages and disadvantages to a voluntary registration and the timing of the registration may also be a feature to be taken into account.
The advantages include being able to reclaim the vat input on purchases which is otherwise lost as a financial cost to the business. However as a consequence of a voluntary vat registration that business would also have to charge vat on all its sales invoices.
If the business has mainly vat registered clients then charging vat would probably not affect sales volume and has the advantage of enhanced credibility within the business community in which it operates. Charging vat to non vat registered clients such as members of the public would increase the amount being charged and make the small business less competitive.
When a business moves from being non vat registered to being vat registered changes may have to be made to the bookkeeping records being maintained. Not normally a problem if accounting or bookkeeping software is being used provided the financial system employed can fulfil the enhanced requirements being vat registered.
The accounting requirements of being vat registered require the business to issue vat invoices which show the name and address of the business, the vat registration number, sales invoice date and the vat being charged. An accounting record must be kept of all sales invoices issued in a format that permits a subsequent audit check when the customs and excise visit to conduct an audit check of the vat records.
In relation to purchase invoices and reclaiming the vat input tax vat may only be reclaimed on those invoices for which the business has a vat purchase invoice. A valid vat purchase invoice contains the vat number of the supplier who issued the invoice. An accounting record must be kept of all purchase invoices showing the vat output tax being reclaimed.
Vat returns are normally required to be prepared on a quarterly basis and submitting to customs and excise before the end of the following month. If registered for the online service vat returns can be filed online. There are benefits to filing the tax return online in that many businesses may receive up to 7 days longer than normal to file the vat return if the vat payment is being made electronically.
There are penalties for failing to submit the vat tax return on time and interest may be charged on the outstanding amount. When a vat return is not submitted on time an assessment may be raised which has to be paid as a legal debt until such time as the return is submitted and the amount due corrected.
It is important to submit the vat return on time even if there is a problem paying the full amount. Failing to submit on time brings the business to the attention of the tax authority that is more likely to inspect and investigate persistent offenders. A business can be expected to receive an inspection every three years however in the worst case scenario of a delinquent vat registered business the customs and excise could inspect every quarter.
Terry Cartwright qualified as a Chartered Management Accountant and Chartered Company Secretary in 1971. A successful business career followed as Head of Finance for major companies in the UK and several consultancy appointments. In 2006 he created DIY Accounting producing Accounting Software for self employed and small companies that use simple accounts spreadsheets to automate tax returns.