IT Expenditure: What Should a Realistic IT Budget Look Like in 2020?

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StrategyDriven Managing Your Finances Article | IT Budget | Entrepreneurship | IT Expenditure: What Should a Realistic IT Budget Look Like in 2020?Every business needs to have an IT department of some sort, whether on-site or remotely, in order to keep their company afloat. So much relies on computers that if they suddenly stop working, your business stops moving.

That being the case, it’s not uncommon to see much of a business’s finances go directly into making sure their IT services continue to run smoothly. But how much do you really need to be spending on an IT budget – and how much are you already spending?

There are limits to how much you should be putting out for the services you receive. This article goes in-depth with how your 2020 budget should look like for your IT software and troubleshooting needs, so you won’t spend any more than necessary. Read on to find out more!

Your IT Budget Will Increase Most at the Beginning of the Year

New year, new you – and new business. Your company is bound to shape up and adopt the “out with the old, in with the new” rhetoric. That most likely also means you’ll be getting rid of old hardware and software and investing in new tech.

Of course, this is bound to bring up the IT bill initially, as the purchasing and the installation of new equipment will be added to the tab. In most cases, however, it will pay for itself in the long run, so the initial purchase shouldn’t be seen as something scary.

Streamlined Operations Will Save You Money

As technology gets better, it becomes easier to use the software to our advantage. These streamline operations will allow you to not only better serve your customers, but will save you money as well.

There will be minimal confusion on what you need to conduct B2B and B2C interactions as well as in-house operations, and the lack of complexity will free up the IT department from working on the small stuff and allow them to focus on what really matters.

Internet Is Faster at Relatively the Same Price

Businesses need internet, and it’s good to know that each year companies are able to make their services faster. It’s even better to know that, due to competition, the internet is still being sold at the same price – or in some cases, even less.

This is good news for you as that means you get better services without the higher price, allowing you to place the money you’ve saved onto other important aspects of your business.

To make sure you stay up to date on how much you’re spending on IT needs, you’ll want to use an organizational tool such as a NetSuite price cheatsheet to make sure you know where every penny goes!

Stay Driven. Be Successful

You know what you should be spending on your IT budget for your computer needs, so now you’ll be able to watch your money flow and still get things done. But that’s only the beginning of what you need to know to help your business succeed.

At StrategyDriven, we help focused and goal-oriented business owners like yourself take on the competition and succeed in their field. We offer help from all angles, including formatting and executing business strategies, management and organizational programs, and more.

Ready to get started? Click on any of the tabs on our site to learn more about what we have to offer you. We’re sure that we can help your company to win!

Signs your business might qualify for R&D tax credits

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StrategyDriven Managing Your Finances Article |R&D Tax Credits|Signs your business might qualify for R&D tax creditsIt is common for businesses to think of research and development (R&D) to be something that is only carried out by specialist science labs and large corporations. And this can lead to them imagining that R&D tax credits are not something that could possibly apply to them. However, it is important to understand that these are misconceptions.

Businesses of all sizes can carry out R&D work – it is just a problem that many people don’t know what qualifies as R&D, or how they might go about making a claim. So here we take a closer look at R&D tax credits and examine some of the situations in which you might be able to claim them. It could be the case that you are missing out on a significant amount of tax relief for your current projects.

Here are some of the signs that your business might qualify for R&D tax relief.

You are an SME

Small and medium sized businesses (SMEs) are sometimes the most likely to miss out of forms of tax relief, because they may lack the accounting expertise to make the most of them. However, the R&D tax relief scheme was specifically designed for SMEs – defined in this case as companies with fewer than 500 staff and a turnover of under €100m.

Larger companies can get tax relief on R&D activities too, but under the R&D expenditure credit banner. But it is just quite ironic that many SMEs don’t realise they can claim on the R&D tax scheme even though it is specifically designed for them.

You’re trying to solve a problem

Even though many assume that their company needs to be scientific or advanced, however, this is not the case. You do need to be looking for ways you can improve what you are doing, and experimenting and researching ways that you can do this. But these activities do not need to be limited to a specific area.

You can claim R&D tax credits across a wide variety of industries. If you create products then it likely that you will be engaging in work that falls under the category of R&D. This could involve creating new products, or improving existing products. It may be in the production process itself, or even in distribution.

As long as there is a problem, and you are trying to solve it – you may qualify for the R&D tax credit scheme.

You are looking to advance the field as a whole

To qualify for R&D tax credits it is important that your project is aiming to advanced knowledge in the field as a whole, rather than simply as a way to benefit your business alone. For example, it would not qualify for R&D tax credit if you were just utilising an existing technology for the first time in your industry.

If your advance can be used by others, then you may qualify for tax credits. This is because the government is intending to incentivise things that the general public can use.

You are doing work others can’t

Another factor in qualifying for R&D tax credits is in showing that the work that you have carried out is not something that can be easily achieved by others. There can be many ways to do this, but one of the most effective is in being able to show that others in your field have attempted to find a solution to the problem.

It is worth noting here that being successful is not a condition of receiving R&D tax credits – you only need to show that you have attempted to find a solution.

You can show that the problem is real

To be able to claim tax relief, it is important to be able to show that there is a problem or uncertainty that you are trying to deal with. You cannot get tax relief for simple exploratory work in the hope that some positive is developed. Additionally, it means that your business cannot already have knowledge of the solution to be able to claim tax relief for it.

If you know the problem that you are trying to solve and can show how it has encumbered others, this can be a strong sign that you can get tax relief for it.

How To Use Money Wisely For Your Business

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StrategyDriven Managing Your Finances Article |Using Money Wisely|How To Use Money Wisely For Your BusinessMoney goes hand in hand when it comes to running a business. For the most part, you need money in order for your company to continue to thrive and to tick along as it may have been doing up until now. However, mistakes can be made when it comes to money, and that’s really not something you want when it comes to your business. So here are some tips for using money wisely and to give you the best opportunities to have a thriving and successful business for years to come.

Be Wary Of Risk Taking

Risks are good to take for your business, but only if you can afford to do so. There are many risks that will come by throughout the course of the company’s existence. Some will be beneficial and work the risk, regardless of whether it pays off or not and some, not so much. It’s good to have a keen eye on which ones look good and then thinking about which ones are going to be the best option for your business at that time. Turning down these risks are going to set you back any more than where you’re at now. Instead, look forward to the opportunity to get that offer again, and perhaps next time you’ll be ready to front the risks. No opportunity is worth losing your business over, so always consider the pros and cons that come with each venture, whatever that might be.

Don’t Hire Too Soon

Hiring is necessary for many businesses to do, some a lot more than others depending on where your business is currently. Every staff member that is hired needs to be bringing something new and substantial, especially when you start creating new roles too. Think about whether your company needs that extra person right now or whether it can be covered by someone who is already within the organization. They might need a pay rise or promotion, but it’s not going to be as expensive as what it would be to hire someone completely brand new and have another responsibility to pay out for as a business. Try to not make rushed decisions when it comes to recruitment because it can often happen, and that ends up being a regret which might end up affecting the financial health of it too.

Get A Loan For Big Expenditures

Loans are a good way to spread the costs of bigger expenditures for your business that maybe you just can’t afford in one go. It might be for something fairly important and an opportunity that is too good or detrimental for your business to miss out on. When getting a loan, you want to make sure you’re picking the right one and that a fast business loan is what you want and can afford to pay back. Remember that this is not your money, and therefore, you need to be careful with how much you’re asking for and how quickly you can pay it back. Loans are good for short-term borrowing, but it’s important to not get tied into something for too long that you start losing more money than you intended through crazy interest rates and hidden fees.

Invest In Quality

Quality is going to save you money because most of the time, it’s not going to let you down. A lack of quality will, and it’s good to remember this when it comes to whatever you buy for the business. Whether it be your manufacturing process and the suppliers you use or the type of workstations you have for your employees. Everything needs to be something you invest your money into because it’ll hopefully avoid you having to pay any of it back in the future. Quality won’t let you down when it’s good, and when it comes to business, you don’t want that to be something that’s happening when it could potentially affect your clients or customers. The lack of quality you have in your business as a whole, the more you’re going to find yourself paying out in the future. When you’re trying to save money, that’s not what you want to be happening.

Outsource Where Possible

Outsourcing is considered to be a popular thing for all businesses to do when they maybe don’t have the space or financials to pay for an extra person to work at the company. At the same time, it’s also good to be able to find an alternative when the task or job that’s required, doesn’t need someone full-time. You might want to consider doing this if you were thinking of hiring someone. It’s a good in-between until you find that you do need them. When outsourcing, make sure you’re doing your research to find the right companies and don’t forget to keep tabs on them. It’s important to make sure that whomever you pick, is someone you can keep up communications with to ensure everything ticks along perfectly.

Do Regular Budget Meetings

Keeping tabs on your money starts with budget meetings. These are worth being quarterly to make sure that you’re keeping up to date with everything that’s changing within the company’s departments. Budgets can change, and although some departments may stick to their budgets, others might not, and so it’s also important sign-off is something you make a thing when it comes to dealing with the finances of the business. That means someone or more than one has to oversee those big expenditures that could cost your business thousands. It’s a safety net worth having so that your accounts team are aware of any big costs that might affect the business for the rest of the financial year.

Using money in your business is something that should always be monitored as your business changes and develops. Focus on regular budget meetings and not making rash decisions when it comes to recruitment or taking risks. Outsource where you can and make sure you’re investing in quality when it comes to your business, in whatever way that might be.

Things to Consider Before Applying for Personal Loans

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StrategyDriven Managing Your Finances Article |Applying for a Personal Loan |Things to Consider Before Applying for Personal LoansMillions of people apply for personal loans around the globe for a multitude of reasons. We seek loans to acquire a property, pay for unexpected expenses or simply, to improve our lifestyle. Many end up getting bankrupt for not being able to repay the amount acquired on heavy interest. Few are aware of the fact that a loan agreement does not just include loan, but also add-ons, often making it almost impossible for the borrower to repay.

One of the solutions to this is small loans, such as payday loans that are availed because these are less risky and provide added benefits. Before you apply for a personal loan, you need to be aware of the following important factors.

1.Identify The Type of Loan: If you’re planning to borrow a personal loan, you need to identify the right type of funds to borrow. Generally, personal loans are available in two forms; secured and unsecured. Unsecured personal loans are not bound to be provided against any collateral but are highly dependent on the lender’s conditions.

Before the lender supports you with the personal loan, he or she looks at your financial history and then decides whether or not they should sanction the loan. If you do not have a strong financial history, then you may avail of the services of a person who does and has a reliable financial position. This loan is riskier in the sense that the lender can recover their investment by selling the collateral in case things do not go well.

2. Criteria to Qualify: When it comes to investment and banking, certain rules and regulations have to be followed as a criterion. Similar is the case of borrowing a personal loan. The first and foremost factor is to find out whether you are qualified to borrow the loan. The general criteria are that the borrowing candidate must be over 18 years of age, has evidence of regular income and strong financial support to be able to survive even without being employed. It is advisable to only approach a lender if you have all of these things in place, or else you might get in trouble.

3. Income Status and Payables: Income status and payables is an obvious thing to decide before you go ahead with the borrowing. Think about what is the best method to repay the loan taken? What are the pros and cons of choosing a certain method, and whether you will be paying it back on a weekly, fortnightly or monthly basis? When deciding your options, remember to know all the conditions of the lender that fall in your favor, so that you make the most of the agreement.

4. Add-on and Interest: The amount of the actual loan and the interest may often be confusing. The amount you take as a personal loan has to be repaid with a certain amount of interest. Since many people are not aware of the concept of interest, they end up paying much more than they should. To avoid this, you should compare the interest rate with other personal loan providers and make a sound decision. This is because different lenders charge a different percentage of interest and have different timelines for repayment. Choose an option that offers the right interest rate and repayment schedule.

5. Comparison between Different Loans: According to an evaluation, banks and other lenders offer a secured loan on eight to 10 percent interest and unsecured personal loans on 12 to 26 percent. Again, this is because unsecured personal loans are riskier. When it comes to the repayment schedule, secured personal loans are more often seen to be long term as opposed to the unsecured ones. If the loan is not paid on time, a huge amount of interest is charged to reduce the uncertainty of loss. Make sure that your comparison is not bound to just the amount of the interest; there are some other things to be considered, such as payment chargers and loan processing fee, which may vary from lender to lender.

6. Lenders to Approach at a Time: Usually, people have the practice to apply for a personal loan with multiple banks, but it reduces the chances of earning the funds on time. Let’s understand how this happens. When a person applies for a personal loan, the bank or the lender is bound to collect their financial history and credit report. Such reports are treated as hard inquiries at the Credit Report Bureau, which reduces the credit score by a few points. Multiple lenders tend to reduce the score, eventually reducing the chances of receiving the loan on time. So, always apply with a good credit score to the least number of banks.

7. The Employment Factor: Many of us are not familiar that the number of jobs that we have switched in the past also affects the successful or immediate loan borrowing. People who are frequent in switching their jobs are considered to be unstable in their professional life, eventually giving a perception of a difficult repayment. This eventually leads the lender to conclude that it is better not to sanction the loan to a certain applicant. You need to understand that if you want a personal loan, then the stability of your professional career also plays a role in making it possible.

Conclusion

Out of multiple personal loans, a payday loan is less risky as it does not allow huge interest or add-ons, and is repaid in a small amount of time. If you need cash, there are multiple options for borrowing the loan, but you need to figure out how you will manage the payment terms and maintain the credit score. Will it be feasible for you to repay the loan in the given time or will it be much more difficult? If you think you are not capable of repaying the loan, then it is better to gain a strong financial status before deciding to approach a lender for funds.

Unsecured Business Loans: A Comprehensive Guide

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StrategyDriven Managing Your Finances Article | Entrepreneurship | Unsecured Business Loans: A Comprehensive Guide

Have you ever felt the need to apply for some sort of business funding? If yes, then I am sure you must have gone through a million options before you came to the right conclusion about your loan. For any business, whether it is a big or small business, funding can actually make a huge impact. Getting the loan that suits your business best is very important. There are various types of loan options available for you to choose from but one option that can really work for you faster is an unsecured business loan. Here is a comprehensive guide that can fully educate you about an unsecured business loan.

What Is It?

What exactly is an unsecured business loan? If we look at the basic definition then this is one type of loan that actually does not in any way require the business owner to pledge any sort of asset or collateral against the debt they receive. The usual protocol for when you get a loan from the bank is to secure any sort of leverage that the business has to the lender to ensure some sort of guarantee. Unsecured business loans are a sort of financing option for those businesses that do not have or do not want to put up collateral for the loan. Through this type of loan, they can still access it and use it in their business in their own way. To get this type of loan all you need to do is apply for financing and also have a good credit score. It is the easiest way to raise funds for your business.

Types Of Unsecured Business Loans

There are certain types of unsecured business loan options out there that you can pick and choose according to the needs of your business in every way. The time period and the amount of loan can be huge indicators for the type of unsecured loan that is the most viable option for you. With options like term business loan, the candidates are mainly given a large amount, which can be repaid over a period of one to five years. This is a type of unsecured loan that is best used to pay off substantial one-time purchases. Another option that works best for short term financing resolutions is an unsecured business line of credit that is indeed a more adaptable finance choice, which is perfect for numerous purposes. Rendering to your long term and short term financing needs, you can check which type of unsecured business loan works best for your company.

Reasons For Need

The question of the need for this type of loan is very important. Identify the clear and concise need for an unsecured business loan that you are going for. An unsecured business loan can have many uses in your company. See whether you want the loan to increase the size of your inventory or to improve the cash flow of your business. Some businesses even require this type of loan to increase the quantity of their staff. Every business has different needs for using an unsecured business loan. Many business owners might get a unique opportunity for which they might need extra funding. In that case, they then go for an unsecured business loan as it can help them in completing whatever they want. Many companies that want to create a good credit rating so that they can prepare their business for a much bigger loan in the future also use this type of loan.

Selection For Lenders

There are many lenders who actually offer an unsecured business loan. When opting for this type of loan make sure that you actually look into all the options for lenders that you have. The reason for this is that many lenders tend to vary and have a different interest rate that they give. Work your options and see what kind of lender best suits your needs and gives you the most favourable conditions for the loan. Times have changed and now when you need a loan the only option available is not your bank anymore. There are various online sources that also offer safe and secure lending procedures that you can go through. As the application procedures for banks and institutions like these have tightened up, people are looking for alternative lenders. You can go for alternative commercial finance lenders or peer-to-peer lenders according to the terms and conditions that suit you best for your unsecured business loan.

Things To Consider Beforehand

There are various things that you must consider before you go for an unsecured business loan. Things like the time period when you need the funds matters a lot. Some places might offer you funds pretty quickly while some actually take their sweet time. When exactly you need the funds needs to be clear so that then you can work according to your timeline. Another very important factor is that make sure that you are absolutely aware of all the terms and conditions of the unsecured business loan that you are about to acquire. The reason for this is that if there are certain conditions that are unfavourable then you should know about them from the get-go. You may be required representing certain financial documents to get your loan approved also. These are things you must know beforehand so that you can work around them before you actually do get the loan. Once you have gotten that loan then there is no going back so make sure you are mindful of such things in the beginning.

May Require Personal Guarantee

The level of risk attached to an unsecured business loan is much higher than a secured one. Thus, it is possible that you may be required to give some sort of personal guarantee against the debt you are to obtain. This means that in the case that your business is not able to pay back the loan it has gotten then the holder of that loan must take a personal responsibility to pay that loan back. The structure of a personal guarantee can vary from lender to lender. Apart from a good credit score the lender will look into your situation and see if you will be able to take a personal guarantee against your loan. This is done to put the lender at ease and lower their level of risk as well.

These are the main and basic principles that are attached to an unsecured business loan. This type of loan can actually be very beneficial to give your business the boost that it needs to move forward. Just make sure you are fully aware of an unsecured business loan before you actually go for it.