3 Things You Should Know About Small Business: May 7
NEW YORK (MainStreet) -- What's happening in small business today?
1. Small manufacturers' growth challenges stem from a lack of financing. U.S. manufacturing is ramping up but some small manufacturers are having trouble expanding because they can't get financing. According to an April survey by MFG.com, as cited by CNNMoney, 26% of 268 respondents cited "lack of capital to grow" as their biggest challenge. The companies need this money to hire more workers, buy new equipment and aggressively market themselves.
Banks acknowledge they are "proceeding with caution," the article says, "especially with loans to smaller contract manufacturers or 'machine and job shops.'" Some banks are concerned that small manufacturers are too dependent on short-term contract work.
MFG.com is an online directory that pairs businesses with manufacturers that can produce their goods domestically.
2. 3 reasons why your profit isn't growing. Your business is doing well these days as sales rise, but for some reason your profit isn't growing. What gives? It could be a pricing issue. Small Biz Trends identifies three common mistakes that many small businesses make when it comes to pricing their merchandise and services.
First, are you pricing similar to your competition? "There are two basic problems with this approach. The first is the assumption that your competitors are making a profit with that price. Even big corporations can have the wrong price and take a bottom line beating," the article says. "The second problem with this approach is apples, or perhaps I should say apples to oranges. How does their expense structure stack up against yours? Is this truly an apples to apples comparison?"
A second mistake is related to your expenses. Don't assume that a small expense is harmless.
"Consider a weekly expense that is $5. Seems like peanuts in the grand scheme of things. Now multiply that number by 52 weeks, at $260 it doesn't seem quite so small," the article says. "What if you were ignoring five different $5 expenses every week? That's $1,300!"
A third mistake is assuming you work for free. "Look at it another way. What if someone else had done the work? Wouldn't you have to pay them? Calculate the cost of your time (if it helps, imagine you're the employee) and include that in the price. And don't forget to actually pay yourself," Small Biz Trends says.
3. Citibank promotes its new small business rewards program with food trucks.Citigroup
Check #citismallbiz to find out the schedule for the week.
Citi recently launched the Citi ThankYou Rewards for Small Business program, where small business owners can combine points earned from their personal and business accounts. Citi is currently running a promotion through June 30, offering 40,000 ThankYou Points -- redeemable for up to $400 in gift cards -- when a new customer opens a CitiBusiness Streamlined or Flexible checking account along with a cash management product or financing solution.
"In listening to our small business clients, it became clear that they want to earn rewards for things they do every day for their personal lives and business, such as using cash management services, making credit card purchases or having a small business loan," said Maria Veltre, Citi's managing director of Small Business Marketing & Customer Experience.
-- Written by Laurie Kulikowski in New York.
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