When it comes to running your small business, knowledge is power. But it’s what you do with that knowledge that really counts.

As your business grows and evolves, it becomes increasingly important to track and analyze key metrics that reveal how your business is performing. But with all the data floating around out there, it can be a daunting task trying to figure out where to focus your time and energy. Luckily, there are several metrics that are relevant to nearly every business across the board.

By monitoring the right metrics, you gain valuable insight into the health of your growing business. Ultimately, a deeper look at this data can help you identify emerging trends, make informed decisions and create a game plan for the future of your small business.

Here are eight key metrics that every growing business should track:

1. Sales Revenue

At the end of the day, sales revenue is one of the most important metrics that should be routinely monitored by a growing business. It is calculated by simply adding up all income earned from customer purchases of your goods and/or services, and then subtracting any costs associated with returned or defective products.

This metric can help you clearly identify which products and/or services are generating the most revenue for your business and, ultimately, where to focus your sales efforts and make improvements in order to maximize your profitability. In addition, sales revenue can be tied to advertising campaigns, price changes, seasonal forces and more.

2. Cash Flow

Cash flow measures the money that flows in and out of your bank accounts. Cash that you pay out is called negative cash flow, while cash that comes into your business is known as positive cash flow.

Without routinely monitoring day-to-day cash flow, your business could end up in hot water financially. A cash-flow budget can help your growing business identify cyclical trends and anticipate when cash flow will peak and trough, making it easier to plan ahead for difficult periods when money will be tight and to capitalize on high cash inflow.

3. Operating Productivity

Another important metric to track is operating productivity. By taking a deeper look at how your employees are performing, you will better understand the inner workings of your small business. Employee discontent can put your company in serious jeopardy, while high productivity will be a huge asset.

Operating productivity ratios can be applied to nearly any aspect of your business – from sales and manufacturing, to marketing and customer support. For example, sales productivity is simply your actual revenue divided by the number of sales personnel.

4. Overhead Costs

In simple terms, overhead costs are fixed expenses associated with operating a business that can’t be linked to any specific business activity, product or service. They are the costs a company incurs to stay in business, regardless of its success level. Examples include rent, utilities, labor and insurance, to name a few.

In any growing business, overhead costs can creep up and out of control if not diligently tracked. Although they will never be eliminated, these expenses can be reduced to help your business remain lean. By regularly monitoring your overhead costs, you will have a clearer picture of where spending occurs in your business – insight that can be used when planning monthly and yearly budgets.

5. Customer Acquisition Cost

Customer acquisition cost (CAC) is a measure of the total cost associated with acquiring a new customer, including your marketing and sales efforts. It is calculated by dividing total acquisition expenses by total number of new customers gained over a given period.

This metric reveals your return on investment when it comes to marketing and advertising expenses. Over time, your CAC should decrease as your business growth and brand image increase. As a rule of thumb, the lower your CAC, the better – but this will ultimately depend on your business model and industry.

6. Customer Retention Rate

As a growing business, you will also want to track your customer retention rate on a regular basis. Simply put, this metric is the percentage of customers that stick with your small business over a given period. It is calculated by subtracting the total number of new customers from your total customers at the end of a given period, divided by the number of customers you had at the start of this period.

The goal is to keep your customer retention rate as high as possible, which can save you money in the long run. This metric also provides insight into how loyal your customer base is and how certain areas of your business are performing.

7. Website Analytics

If you aren’t already monitoring the analytics for your company website, you need to start. By routinely tracking and reviewing your website analytics, you will gain valuable insight that can be used to better serve your audience, assess how your marketing strategy is working and make improvements to your growing business.

For instance, it may be helpful to monitor the most popular content, traffic sources and page views for your business. By keeping tabs on your most popular content, you will get a better understanding of your audience and its content preferences. Your traffic sources can tell you how your social media and email marketing strategies are performing, while your page views reveal how many people are coming to your site.

8. Gross Margin

Another key metric to track is gross margin. After all, your bottom line is everything when it comes to business. The formula for calculating gross margin is sales revenue minus the costs of goods sold, divided by sales revenue, and then multiplied by 100.

Gross margin represents the percentage of every dollar of revenue that your business retains and can potentially invest back into the company to drive growth. As a rule of thumb, the higher your gross margin, the more your spending power will be.

In recent years, the number of cyberattacks has been increasing at an alarming rate – and small businesses are particularly vulnerable. In fact, 43% of all cyberattacks target small businesses. This is because they are often seen as an easy gateway into larger companies through the supply chain or payment portals.

Even a single cyberattack can have a swift, devastating impact. On average, it costs small businesses $690,000 to recover from a cyberattack. Of those small businesses that experience a cyberattack, 72% are not able to fully restore their company’s computer data, according to a recent study by the Ponemon Institute. Further, 60% are forced to close their doors within six months.

Despite the looming threat of a cyberattack, 83% of small-business owners don’t have any cybersecurity measures in place – with many mistakenly believing they are too expensive or difficult to implement. But as the number of cyberattacks continues a steady climb upward, companies are beginning to invest significantly more dollars in cybersecurity. In fact, cybersecurity spending has seen a 67% increase over the past three years.

Now more than ever before, it’s critical that small-business owners develop a robust cybersecurity plan that will help keep their data safe and secure. But in order to be most effective, companies will first need to be aware of the latest trends in cybersecurity for small business:

1. Federal Guidance on Cybersecurity

Small businesses play a vital role in our nation’s economy, accounting for 54% of all U.S. sales and 55% of U.S. jobs. They are also a top target of cyberattacks, which can be caused by a variety of threats – from viruses and worms, to phishing and malware.

However, many small-business owners lack the expertise needed to successfully monitor and protect their computer systems and sensitive information, making them particularly susceptible to crippling cyberattacks. But as cybersecurity has become a major priority on a national scale, federal agencies are now turning their focus to protecting small businesses from this threat.

As part of this effort, the U.S. House Committee on Science, Space and Technology approved the NIST Small Business Cybersecurity Act of 2017 on May 2. Sponsored by the National Institute of Standards and Technology (NIST), this bipartisan bill would provide the key resources, tools and best practices to help small businesses cost-effectively identify, assess, manage and reduce their cybersecurity risk, if enacted into law.

2. A Rise in Ransomware Attacks

In recent years, companies of all sizes have been challenged with navigating a constantly shifting cyber threat landscape. Ransomware – an attack in which cybercriminals hold a company’s digital assets hostage in exchange for money – has recently emerged as a very serious threat for small-business owners.

At least 190 types of ransomware currently exist, with more created every day. Once a malicious link is clicked, the malware encrypts files on a victim’s computer and locks access until ransom is paid, which can cost anywhere from $200 to $30,000 per incident. In most cases, ransom is demanded in bitcoins – making the transaction difficult to trace.

And ransomware is only becoming more frequent, effective and costly. The number of ransomware attacks spiked 6,000% last year – infecting an average of 4,000 computers worldwide per hour, according to the FBI. Further, ransomware robbed companies of nearly $1 billion in 2016 alone. This is just the tip of the iceberg, as ransomware attacks will likely spread to internet of things (IoT) devices, point of sale (PoS) systems and ATMs this year.

When hit with a ransomware attack, businesses have three options: pay up, restore from a backup or suffer the consequences of not having access to critical business systems. The problem is, this business model works – 70 percent of companies paid ransom to get their data back, according to a recent study by IBM Security.

3. Shadow IT Security Risks from Cloud Storage

With the rise of the digital workplace, IT is no longer the purveyor of all systems and applications within a company. Instead, employees are increasingly turning to the cloud to meet their evolving technology needs. But as cloud storage offers on-demand access and less IT involvement, cybersecurity has become a major concern.

The appeal of cloud-based services such as Gmail, Asana or Dropbox is readily apparent – data can be stored online and accessed from anywhere, effectively allowing employees to get their tasks done quicker and more easily. According to a recent report by the NPD Group, 76% of respondents reported using a cloud-based service over the past year. However, this has led to a huge problem – the rise of shadow IT.

In simple terms, shadow IT is when cloud services are used without IT’s approval. For every instance an employee uses an IT-approved cloud service, there’s another using a personal, unsanctioned version. Even with approved apps, nearly half of users are accessing them from non-corporate email accounts – ultimately exposing sensitive data to external threats.

To address this growing issue, more than three out of five companies are putting formal usage policies in place to mitigate the risk of shadow IT on the cloud. By creating a cloud usage strategy, small-business owners can be better equipped to monitor and prevent unauthorized cloud usage – before it becomes a security issue.

4. DDoS Attacks of IoT Devices

The advent of IoT has opened the door for a new realm of hacking opportunities – the most recent being distributed denial-of-service (DDoS) attacks on IoT devices. In simple terms, a DDoS attack is when a hacker overwhelms a system with data – most commonly a flood of website traffic that causes a web server to crash – ultimately preventing legitimate users from accessing the system.

Most recently, DDoS attacks have spread to IoT devices within the workplace, such as printer/copier machines, IP-connected security systems, internet routers and climate control systems – presenting hackers with an unexpected means of accessing business networks.

In the rush to roll out a variety of IoT devices, security has taken a backseat – making DDoS attacks that much easier (and likely) to occur. According to a recent report by Cisco, 17 million DDoS attacks are projected to occur annually by 2020 – a 260% increase in only five years. And more than 25% of all identified attacks will involve IoT devices, according to Gartner.

In response, the Federal Trade Commission recently began cracking down on security by targeting IoT device manufacturers whose devices lack adequate security – and security spending has increased as a result. In fact, worldwide spending on IoT security is expected to reach $434 million this year, nearly a 25% increase from 2016.

5. The Use of DMARC for Email Authentication

Of all forms a cyberattack can take, phishing is reportedly the most common. More than one million phishing attacks were detected in 2016 – a 308% increase year over year, according to a recent report by RSA Security. Even more alarming, phishers launch a new attack every 30 seconds.

Most recently, there has been a sharp spike in phishing attacks that impersonate a company through email and SaaS services, such as MailChimp or Salesforce. Without malware or bad links in the email to filter out, these types of attacks can bypass traditional security defenses – making them difficult to catch.

In response, many email service providers are adopting domain-based message authentication, reporting and conformance (DMARC), an email-validation system that protects email users from phish by blocking same-domain impersonation attacks as soon as they are attempted.

In addition, DMARC generates a report of all rejected emails for the domain owner – providing an opportunity to catch phishing attacks in real time, as well as to identify any “shadow” services that employees might be using without approval.

6. A Need for Cyber Liability Insurance

In today’s modern workplace, companies store more sensitive information online than ever before. But there seems to be a disconnect – although small businesses are the top target of cyberattacks, most are still not covered for lost or stolen digital assets.

Surprisingly, 65% of small businesses don’t have any funds budgeted for cybersecurity, nor plan to make funds available in the future – despite the fact that one out of three can’t go without access to critical business databases for any length of time, according to a recent survey by CyberScout. And even though small businesses lack the resources to overcome a cyberattack, 75% have no cyber liability insurance as a protective measure.

When cybercriminals breach a company database, they can get their hands on a wide variety of sensitive information – from identifying data such as social security and credit card numbers, to business data that can be used to open and access accounts, drain money and destroy credit.

Like other types of coverage, cyber liability insurance covers companies in the event of a cyberattacks. As small-business owners work to recover sensitive information, this insurance covers associated expenses such as network damage, credit monitoring, lost revenue, crisis and reputation management, customer notification and investigative work. It’s certainly a small price to pay in comparison to the cost of restoring company systems – or even going out of business.

However, it’s important to keep in mind that cyber liability insurance will not prevent a cyberattack from occurring. Instead, small-business owners should incorporate cyber liability insurance into an overall cybersecurity strategy that includes prevention safeguards and an incident response plan.

Want to learn more about growing Your Small Business and Personal Assets?

Contact Citadel Earth at (216) 593-0402.

With less staff, resources and money compared to large corporations, small businesses have always been the stereotypical underdog. However, thanks to several technology advancements, these small businesses now have the ability to bring their companies up to match the larger competition.

From online project management tools to marketing automation software, modern technology allows small business owners to effectively run their companies and promote services, all while staying out of the red. These new tools are shaping the way the 28 million small businesses in the U.S. are keeping up with larger organizations in a competitive market.

As a small business owner, it can be hard determining what technology you should invest in, the options are endless. Here are just a few advancements in technology that we think help small businesses compete:

1. Marketing Automation

Marketing automation is one of the keys to giving your small business a competitive edge against larger companies. On average, 49% of companies are currently using marketing automation, as it drives a 14.5% increase in sales productivity. Marketing automation provides small businesses the tools needed to streamline the most time-consuming processes of marketing. It is a one stop shop to automate repetitive tasks such as email, social media and other website actions. Through one service, small businesses can send eNewsletters, post Tweets, create subscriptions lists, write blogs and so much more. A few examples of marketing automation services include:

• HubSpot
• Marketo
• Pardot

These services help small businesses stay in front of their audience through multiple platforms. With more content distributed, small business can create more touch points with their audiences, increasing brand, service and product awareness.

Marketing automation also provides small businesses the opportunity to nurture leads effectively and efficiently. The software allows the sales team to focus on hot leads and send leads not quite ready to commit through a pre-determined sales pipeline. In addition to increasing sales productivity by chasing qualified leads, you can better target your audiences with appropriate messages through the information you’ve collected via your marketing automation software, helping you move customers through the sales pipeline.

2. Digital Advertising

Before the creation of the internet, marketing and advertising platforms consisted of print and broadcast, and was reserved for large companies with hefty budgets. Today, small businesses can leverage digital advertising – banner and search ads, search engine optimization (SEO) and social media advertising – which often reaches your target audience, but at a lower cost.

Digital advertising is not only cheaper than traditional advertising, it also allows you to easily track who is engaging with your ad. It reaches your audience through multiple platforms, allowing you to target a specific demographics and measure the effectiveness. You can track how far your ad is reaching, who is viewing it, how many clicks it receives and average return on investment. From there, you can dissect the data to see who is most interested in your product or service.

Some examples of digital advertising include:

• Display advertising (banner ads, video ads)
• Social platforms (Facebook, Twitter, LinkedIn)
• Search (SEO, paid search)

Through digital marketing campaigns, small businesses can spread brand awareness, target specific audiences and compete with large companies, with a smaller budget.

3. Project Management Software

Employees working for small businesses tend to wear many hats; juggling multiple roles and responsibilities. Planning a large project can be difficult with employees constantly shifting job functions. An online project management tool can help organize tasks and responsibilities, all on a collaborative and real-time platform. It provides organization and direction, without the price tag of hiring a project manager.

Some project management tools include:

• Wrike
• Asana
• Trello

With these tools, small businesses can delegate tasks to individuals or teams, get an overview of all activities and track time spent on projects.

4. Invoicing Software

To successfully manage and operate small businesses, owners depend on receiving payments from customers on time. Invoicing software allows small businesses to generate professional invoices quickly and efficiently. Having a professional invoicing software can help increases your chances of getting paid on time and minimizes the risk of having a payment lapse. The software can track who has viewed and paid your invoices in real time, giving small business owners the information they need to stay in the black.

Some examples of invoicing software include:

• QuickBooks
• Due
• Sighted

These services allow small business owners to track employee-time, request online payments and create reoccurring invoices. With web-based invoicing, small business owners can also cut costs such as paper and postage expenses.

5. Online Payment Services

Going hand-in-hand with invoicing software, online payment services allow clients to pay invoices easily, quickly and efficiently. With the development of online payment services, clients can make payments with a click of a button, taking the stress out of the payment process for small business owners and their customers.

A few examples of online payment services include:

• PayPal
• Square Cash
• Amazon Pay

Online payment services allow customer payments to be directly deposited into a designated account. Customers can pay online or on mobile devices with credit cards.

Need help competing with large businesses?

Contact Citadel Earth at (216) 593-0402

As we move into 2017, today’s ever-evolving marketing landscape continues to place more demand on small-business owners than ever before. Although many small businesses lack the capital and resources for a marketing team, the development of modern business technology can empower small-business owners to reach potential customers in untapped markets across the world. In order to drive growth and success for a company, small-business owners must remain competitive by staying informed on the latest marketing trends that can help deliver brand messages and resonate with their target audience.

Here are three emerging trends for marketing your small business in 2017:

1. Targeted social advertising spend forecast to skyrocket

Gone are the days where organic reach is enough. As social media channels have matured, new algorithms are being employed that increasingly limit the percentage of your social audience who can see and engage with your posts. As a result, business owners are finding it more difficult to leverage the social audiences they’ve worked so hard to build.

In response, we’re seeing a shift toward companies allocating a larger portion of their marketing spend to digital advertising. A recent study revealed that, for the first time, digital ad spending in 2016 surpassed that of TV. This comes as no surprise, given the sharp rise in social, mobile and video.

The use of social advertising, in particular, is forecasted to skyrocket in 2017. According to HootSuite, social advertising budgets have doubled worldwide over the past two years – going from $16 billion in 2014 to $31 billion in 2016. By 2019, social advertising spend in the U.S. alone is expected to rise to more than $17 billion. That’s no small number. Companies are clearly recognizing and harnessing the power of social media as an effective advertising tool to reach their coveted social audiences.

In addition to being highly targeted, social advertising allows you to easily track ROI in terms of views and clicks. However, some platforms perform better than others. In a recent survey, 95% of social media marketers said Facebook produces the best return, followed by Twitter and Instagram. In fact, Facebook ads generate eight to nine times higher click-through rates than traditional web ads.

2. Marketing automation will streamline repetitive marketing tasks

Despite marketing automation emerging as a buzzword in the marketing industry, many companies still have no clue what it does and how it can benefit their business.

In its simplest terms, marketing automation refers to software platforms that streamline and automate repetitive marketing efforts, such as emails, social media and website actions. By maximizing employee productivity with minimum time spent, marketing automation frees small-business owners up to focus their energy on larger projects.

For instance, marketing automation is often used to improve the effectiveness of email marketing efforts. It allows companies to deliver a series of highly targeted emails that are specifically tailored to their prospects’ needs, as opposed to mass distribution of generic email blasts with the hope that a few prospects will bite.

Ultimately, this boosts open, click-through and conversion rates and produces more qualified leads. In fact, companies using automation technology generate 2X as many leads and are perceived to be twice as effective at communicating. Further, 67% of B2B marketers saw at least a 10% increase in sales opportunities through lead nurturing, while 15% had opportunities increase by 30% or more.

3. Video will become a key part of content marketing

Last, but certainly not least, video is taking the marketing world by storm – and for good reason. Research reveals that, when offered as a content choice, video is preferred over all other content, including white papers, case studies, webinars and e-books. In fact, 55% of people pay more attention to and engage with videos over other forms of content, according to a recent survey by HubSpot.

As the demand for video continues to rise, it’s becoming a key part of a business’s content marketing strategy. A recent report revealed that 73% of marketers plan to increase their use of video in general, and 50% will use live-streaming social platforms such as Facebook Live, Periscope and YouNow over the coming year. The other half wants to learn more about live video.

Companies using video in their marketing efforts are finding great success. Video generates 1,200% more shares than text and images combined, and attracts 41% more web traffic from search. Further, having video on your landing page can increase conversions by 80%. Given this statistic, perhaps it’s not surprising that video users grow their revenue 49% faster year-over-year than non-video users.

And with the explosion of affordable video creation tools, companies no longer need to partner up with a pricey production team and studio. Video can easily be produced by just one person – which comes as welcome news to small businesses looking to create videos on even smaller budgets.

Want more ideas on growing Your Small Business and Personal Assets?

Contact Citadel Earth at (216) 593-0402.

As we ring in the New Year, small-business owners are facing a host of new challenges as a wave of emerging trends hits the marketplace and technology becomes more vital to business growth and success than ever before.

Small businesses that adopt and embrace these changes will stay ahead of the curve and position themselves for business growth in 2017. On the other hand, those who lag will inevitably fall behind and struggle to keep up with their competitors in today’s ever-changing digital world.

Here are four trends to help drive growth and success for your small business in 2017:

1. Innovative technology is transforming the B2B payments landscape

With the explosion of cross-compatible accounting platforms and versatile software that integrate seamlessly with mobile technology, we’re seeing a new wave of innovative payment technology emerge. This will inevitably transform the way businesses handle transactions in the B2B space.

As mobility becomes increasingly central to business growth and success, this has ignited a rise in mobile payment platforms such as PayPal.Me, Masterpass and PayApp. Although many B2B businesses are still hesitant to fully embrace these platforms, their convenience and ease of use will ultimately drive movement away from more traditional payment methods like paper checks and invoices.

Businesses that adopt these platforms are more efficient, agile and secure. In addition to allowing real-time payments, mobile payment platforms easily integrate with existing payment processes and support alternative payment methods, such as credit cards. This is particularly useful, considering that 13.9 million small-business owners had credit card accounts in 2015, which accounted for more than $430 billion in spending.

However, although mobile payment technology can help businesses improve their cash flow cycle, it does not have the power to solve core financial issues. Before adopting these platforms, business owners should first focus on getting their financial house in order.

2. Millennials are reshaping the workplace culture

Millennials now make up the largest generation in the U.S. workforce, according to a recent report by The Pew Research. But despite this generation becoming a key player in business success, companies are struggling to recruit and retain millennial talent.

In fact, 60% of millennials leave companies in less than three years – leading to a reputation as the “job-hopping” generation. They’re also the least engaged generation in the workplace. Only 29% are engaged at work, meaning a mere three in 10 millennials are emotionally connected to their jobs and companies.

However, it’s entirely possible that many millennials actually don’t want to switch jobs, but their companies aren’t giving them compelling enough reasons to stay. Employee engagement tactics that worked for Baby Boomers and GenX-ers aren’t as effective with this new generation of workers.

To meet the needs of our changing workforce, companies need to create a workplace culture that appeals to millennial motivations, including:

• Work-life balance (e.g., flexible schedule, remote work, ample PTO)
• Adoption of new technology
• Relaxed work environment (e.g., collaborative work spaces, casual dress)
• Emphasis on corporate social responsibility and values
• Regular performance feedback

Businesses that don’t adapt their workplaces to the changing workforce will fail to attract and retain millennial talent, ultimately creating a roadblock to competitiveness in the marketplace.

3. Cybersecurity has become a major priority

In recent years, the number of cyber breaches has been increasing at an alarming rate – posing a significant threat to businesses of all sizes. On average, a total of 80-90 million cybersecurity incidents is reported annually. In 2015 alone, we saw a 35% increase in cyber breaches from the prior year. And that number is continuing a steady climb upward.

However, despite the looming threat of cyberattacks, most companies don’t have cybersecurity measures in place. In fact, 81% of data breach victims lack a security system or managed service to self-detect and protect against cyber breaches. Adding to this, more than 52% of respondents from a 2015 survey believed a successful cyberattack against their network would take place in a year.

In response, business owners are beginning to invest significantly more dollars in cybersecurity measures. Over the past three years, cybersecurity spending has seen a 67% increase. Many companies are making the switch to cloud-based services to protect more sensitive data. In the financial arena, for instance, 48% of financial services are being delivered via the cloud.

As part of these preventive measures against cyberattacks, companies should establish specific protocols for all employees, such as:

• Using current virus protections on work-related devices
• Updating firewall systems
• Avoiding file downloads from unknown senders
• Using strong passwords
• Updating the operating system regularly
• Using a virtual private network

With 43% of all cyberattacks targeting small businesses, it’s more critical than ever before to implement a robust cybersecurity strategy that will keep data both private and intact.

4. Social networks are rCitadel Earthizing business communication

These modern workplaces call for more effective forms of communication that foster collaboration, increase efficiency and boost productivity among employees.

Employees now spend nearly 80% of their time on collaborative activities, such as meetings, phone calls and responding to emails, according to a recent study by the Harvard Business Review. This leaves little time for employees to focus their energy on completing actual work on their own.

To combat this collaboration overload and break down silos in communication, today’s digital age has given rise to a variety of collaborative tools for communication within the workplace. These tools range from social intranet and web conferencing platforms like Google Hangouts and Zoho Meeting, to instant messaging and remote control support such as Yammer and TeamViewer.

By fostering more effective and efficient communication, online social tools help boost collaboration among employees – ultimately leading to a more engaged, productive workforce. In fact, productivity levels rose by 20-25% among workers who use online social tools to collaborate, according to a recent study by the McKinsey Global Institute.

Want to learn more about growth strategies for Your Small Business and Personal Assets?

Contact Citadel Earth at (216) 593-0402.