6 Ways to Improve Your Relationship With Your Customers
An article published in today’s CNN Money online, titled “Manufacturers to banks: We need money now,” depicts a somewhat troublesome trend in the small business economy. Although business has returned to many industries and revenues have begun to grow, they can’t grow the business as much as they would like because of a lack of access to working capital. In the manufacturing industry in particular, although the big banks acknowledge growth among manufacturing businesses, they still believe that lending them money will be too much of a risk. This is due to the seasonality of the businesses and the short-term nature of their work. The banks claim that even if business is booming now, it will be hard for these types of businesses to pay off their loans because their contracts might end too quickly and so revenues will slow down again.
This predicament is a serious, recurring problem that has continuously stunted the growth of the U.S. economy since the onset of the Great Recession in 2008. These businesses are unable to hire new employees, market their product to their fullest capacity, or purchase the newest supplies and inventory available to them because they don’t have that extra financial boost that will take their business to the next level.
According to Chris Free, the CEO of MFG.com, who was interviewed in the CNN article:
“Any prudent business owner knows that cash is king. When funding is tight, you go into preservation mode, you restrict appetite for expansion and this hurts the economy,” said Free. “We all feel it.”
The article fails to point out that there is a small business financing method that has become increasingly popular for the very reason of lack of access to business working capital. Merchant cash advance funding specifically addresses small businesses, such as the manufacturing businesses mentioned in this article, who are facing limitations because banks are denying them additional financing to grow. Although many believe cash advances to be a form of small business funding that is best suited to businesses that are hurting or desperate for capital, this is not the case. Cash advances are specifically designed for businesses who are processing at least $4k a month in credit cards (or $10k a month if the business is cash only) – so it is not the case that 100% of businesses qualify. But with the numbers mentioned in the CNN article, it is clear that many of these manufacturing businesses who need additional working capital would easily qualify for a merchant cash advance which could help their businesses to hire the additional staff, pay for new supplies, and market their product. In short, a cash advance would help these businesses grow even though the banks played no part in the funding process.
If you run a small business, we’d be more than happy to interview you for our Small Business Interview Series. In exchange, you get free press and a high quality back-link back to your business’ website, which will help you gain exposure and boost your rankings on Search Engines!
The process is simple!We will interview your business either through a short online questionnaire or over the phone. You tell us about your business and give us answers to the questions we asked. We will feature you on the Our MCA Funding Company Cash Advance Blog, including a link back to your website!
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The popular Greek yogurt company, Chobani, has taken home this year’s “Entrepreneurial Success of the Year” award given out by the Small Business Administration. Chobani represents a small business triumph: although the company started as only 5 employees, it has since grown to over 1,200 – and it’s still expanding! Since its inception in 2005, Chobani has since become the top selling yogurt company in the U.S. What lessons can we learn from their tremendous success story?
1. Consumers’ Preferences are Changing
The most important lesson to be learned by Chobani’s success is that consumers are beginning to show a strong preference for healthy, all natural, organic products.Due to a raised awareness about the skyrocketing rates of obesity, diabetes, and other health issues caused by poor eating habits, many consumers are beginning to make healthier decisions that reflect in the purchases they make. Chobani perfectly timed the release of their product to tap into this lucrative market as it gained traction.
2. Learn how to Anticipate Future Trends
One wise move Chobani executed upon releasing their product was to anticipate a growth in demand for healthy products, and to release their Greek yogurt product accordingly. Upon entering into the market, very few American customers even knew what Greek yogurt was. But as more and more began to focus on purchasing healthy products, Greek yogurt grew in popularity. Chobani was one of a few companies even offering the product at the time, leading to its inevitable success.
3. Smart Marketing Can Turn Customers Onto Products They Never Knew About
Chobani’s decision to create a product that is entirely all-natural gave them leverage to market their product in a way that truly set them apart from competitors. Because Greek yogurt is inherently high in protein, calcium, potassium, and many healthy probiotics, they could use this information to appeal to a customer base that might have never even known about Greek yogurt’s health benefits. They were able to capitalize on the unique aspects of their product to appeal to customers who, in many cases, were new to identifying healthy, nutritious food products.
4. Time Your Loans Correctly
Chobani would not have seen its rate of success and growth were it not for its perfectly timed use of an SBA-backed small business loan and the way in which they chose to spend their funds. According to the Washington Post, the founder of Chobani “purchased an old Kraft Foods plant in New Berlin, N.Y., using an SBA 504 loan secured through KeyBank and the Empire State Certified Development Corporation” in 2005. He then spent 2 years crafting and perfecting his product. This strategy of using the financing in a strategically calculated fashion shows that owner Hamdi Ulukaya had a well-crafted plan for the trajectory of his business. It is always important to write a good business plan that focuses on how to spend your business financing over time.