The advent of artificial intelligence (AI) is radically transforming the business landscape. This shift is opening up new opportunities for small businesses to get a foothold in the market. With AI-powered tools and services, these businesses can level the playing field and compete with larger organizations. 

To succeed in this new environment, small businesses need to be agile and embrace change. Those who do will find themselves well-positioned to take advantage of the exciting opportunities that AI presents.

Here are six ways that artificial intelligence can benefit small businesses:

Customer Service

Customers are the lifeblood of any business, so it’s important to keep them happy. When customers are happy, they’re more likely to buy from you again. By harnessing the power of artificial intelligence, small businesses can take their customer service to the next level. 

AI-enabled tools can help by providing faster responses to queries, automating repetitive tasks, and offering personalized recommendations. In short, AI provides a better customer journey and personalized experience.

In addition to automating basic tasks, artificial intelligence can be used to provide 24/7 customer support. A chatbot, for example, can answer questions and solve problems.

Sales

Every small business looks for ways to increase sales and revenue. But did you know that AI can help you do just that? By providing targeted product recommendations, upselling opportunities, and personalized discounts, businesses can make the most of their limited resources. Additionally, this technology can help identify areas of improvement and potential growth.

According to a McKinsey report, companies that used artificial intelligence achieved a 20 percent operating profit margin, compared to just 2 percent for companies without AI. The increased performance is due in large part to the ability to offer customers more personalized services and products than ever before.

Reduce Costs

As small businesses strive to cut costs, artificial intelligence can be a valuable tool for automating tasks, eliminating manual data entry, and reducing the need for customer support staff. By taking advantage of AI technology, small businesses can save time and money while improving their efficiency and productivity.

Companies that are constantly collecting data from customers, such as through transactions or web forms, can analyze all that data to identify patterns and trends. Using this analysis, artificial intelligence can predict customer behavior and streamline your marketing campaigns across all platforms. 

Better Decision Making

Good decision-making is critical for any business owner or manager. AI can help by providing data-driven insights that can guide decision-making in areas like marketing, product development, and operations. ​​It can also help assemble the best teams to increase productivity.

Increasing Efficiency

Efficiency is key for any business, large or small. AI-enabled tools can help small businesses increase their efficiency by automating and optimizing processes and providing real-time results.

Small businesses can see a 40% increase in productivity by utilizing AI in various ways. For example, AI can speed up processes and tasks that would otherwise be slow and tedious for human workers. In this way, businesses can operate more efficiently and get more done in less time. Implementing this technology into small businesses can be a game-changer in terms of productivity and output.

Security

As businesses become increasingly reliant on technology, security concerns are top of mind for many companies. AI can help small businesses enhance their security measures by providing fraud detection, intrusion detection, and data encryption capabilities. By incorporating AI into their security protocols, small businesses can give themselves a much-needed boost in the ever-evolving digital landscape.

Final Thoughts

The adoption of artificial intelligence by organizations can have a significant impact on their business profitability. AI will likely benefit all businesses by making life easier, increasing efficiency, and improving productivity.

Artificial intelligence is no longer a futuristic concept; it is permanently changing the landscape of business. Capitalizing on the power of AI is a key strategy for small businesses looking to grow and succeed. The benefits that AI can bring to an SMB are many. Begin exploring how artificial intelligence can help your business grow today.

How FINSYNC Can Help

FINSYNC allows you to run your business on One Platform. You can send and receive payments, process payroll, automate accounting, and manage cash flow. To learn more about how we can help your business start, scale, and succeed, contact us today.

Wherever you look, prices of gas, transportation, essential materials, products, and services are shooting up at rates unseen in over a decade. Large corporations have already become proactive, bracing for impact as stocks continue to plummet due to inflation and Fed rate hikes. 

Is there a concrete method to prepare your organization for inflation? 

First, let’s look at why inflation is so high, how inflation accounting can help, and finally, ways to restructure your cost analysis for inflation within your organization. 

Why Inflation Is High

Rising prices at the gas pump and in grocery stores have been one problem, but inflation has spread beyond, to housing, car sales, and many other areas. The primary reason is that the nation still has not been able to keep up with consumer demand after COVID. 

Supply chain interruptions, labor shortages, increase in shipping and insurance rates, along with China’s lockdowns have all negatively affected production lines for goods and services. Even though wages are rising, many companies are unable to retain employees. Take truck drivers, for example; there are 80,000 unfilled trucker vacancies in the US alone. Globally, the shortage is wider spread.

Another cause of high inflation has to do with Russia’s attack on Ukraine, which both directly and indirectly fuels inflation. Russia is an important manufacturer of natural resources like oil, coal and gas. In addition, Ukraine is one of the largest exporters of grains and fertilizers. Together the war-driven instability in these countries is enough to destabilize the global supply chain system for decades.

Despite global challenges, there are steps small businesses can take to help weather the storm and even come out ahead.  

Inflation Accounting

A great place to start tackling inflation is accounting for it correctly in your operations. Many companies take advantage of what is known as inflation accounting, which is when financial statements are adjusted according to price indexes rather than traditional cost accounting. These adjustments paint a clearer picture of a firm’s financial position during high inflationary periods.

Here are the two main methods used in inflation accounting:

1. Current Purchasing Power (CPP)

Under this cost method, monetary and nonmonetary items are separated. Monetary items are subject to the recording of a net gain or loss. Whereas nonmonetary items, or items that do not have a fixed value, are updated into figures with an inflation conversion factor related to the consumer price index (CPI).

2. Current Cost Accounting (CCA)

This approach values assets at their fair market value (FMV) rather than historical cost, and fixed assets are recorded at replacement cost value on the balance sheet. Additionally, depreciation of fixed assets is to be calculated at replacement value.

To calculate the inflation rate, divide the CPI at the end of the period by the CPI at the beginning of the period multiplied by 100.  

By adopting inflation accounting, you can match your business revenues accurately compared to current costs to provide a more realistic profitability breakdown. 

Comprehensive Cost Analysis

There are hundreds of inflation articles centered around businesses employing price increases. The reason is this tactic helps an organization in the short term. Even consumers might be on board with the higher prices, especially if they believe these are only temporary. 

However, to overcome inflation in the long run, a company must look beyond price increases to reduce the financial volatility across the entire organization. 

Short-Term 

The beginning of an inflation crisis is a great time to get granular about your organizational costs. Don’t just look at the price your suppliers and competitors are charging, but perhaps create alerts to be notified of price fluctuations for raw materials and other supply chain data. Getting ahead of these increases will provide valuable information such as surfacing a supplier who is price gouging unnecessarily. 

Another initial cost strategy is to understand your capital structure. Take a deep dive into your cash, credit, and debt to determine which loans need immediate repayment. Restructure your financial management by obtaining new lines of credit as a fallback in case situations last longer than anticipated.

Long-Term

Keep morale high to prevent employee attrition. The last thing your company needs right now is to lose its top talent to a competitor who is almost surely hiring. Losing employees could mean months of lost productivity and massive resource expenditure on identifying, hiring, and training replacements.

It may also be time to update your technology stack. Take a lesson from Tesla, which now utilizes robots and AI to construct and build electric vehicles. Start learning new applications like automating your HR and payroll, or integrate new software to help roll out digital marketing strategies.

Another cost-saving tool is to redesign products to reduce the impact of expensive materials. Go back to the drawing board to create innovative products that retain their quality without the dependence on finite resources. 

Overall, inflation can present a valuable opportunity for many organizations to nail down their cost structure. Regardless of whether inflation is here to stay, companies that adapt their business operations quickly and decisively to rising costs will be in the best possible position to maintain margins and growth.

Most of us understand the key to business growth and success is developing excellent customer relationships that lead to long-term client retention. But where does this burden fall? Sales? Marketing? 

The simple answer is everyone. Companies make mistakes in only developing a relationship during the transaction. But with digital tools like CRMs, content management systems (CMS), and demand experience platforms (DXP) becoming easily accessible, it is pretty clear this landscape has changed. These important relationships begin before the initial purchase and can be fruitful as a source of referrals long after their initial transaction.

This article dives into the benefits of establishing a customer relationship management process and how to implement one within your organization. 

Importance of Customer Relationship Management

Customer relationship management (CRM) is a process for managing all your company’s relationships and interactions with current and potential customers. By increasing this bond or connection with your customers, you decrease the amount of work it will take to make a purchase.

By implementing a solid CRM process, you build brand loyalty with your audience. This strong association users have with your company has many advantages, such as being top of mind when faced with a related problem. This scenario exemplifies the importance of social media and how your audience views your brand. 

Recent studies have shown that a prospect needs to see or hear the advertiser’s message at least seven times before they will take action to buy a product or service. Therefore, consistency is key to refining campaign strategies around vibrant images and product videos that are memorable and initiate buzz.

Finally, the better your relationships are, the more comfortable customers will be when addressing an issue with one of your products or services. Do not underestimate the power of a good review. When you engage with your customers, even if you are troubleshooting problems, this valuable time can set them at ease and provide the potential for you to improve your merchandise.

Principles of Good Customer Relationships

Each time a potential customer interacts with your business, whether on your website, social media, email campaigns, or newsletters, their experience must be consistently enjoyable. In providing a service such as real-time customer support, you begin building a mutually beneficial relationship. You learn something about the customer, and they discover a new product or offering within your company.

Here is a short list of things to consider when fostering these relationships.

1. 1. A customer’s need for a positive experience far outweighs the goods and services you offer.
   2. Get inside their head and convey that you understand their pain points while being able to offer appropriate solutions.
   3. Personalize your communication by customizing your omnichannel messages about the different products you offer. 
   4. Share knowledge in an email, newsletter, or blog article, and keep your audience updated on the latest research and industry trends.
   5. Exceed expectations by building rapport and always going above and beyond in all areas of your organization.
   6. Listen and learn what your customers value the most.

Using these principles throughout your organization will keep your sales pipeline full of new leads and referrals. Building a solid relationship with your clients earns their trust that you will eventually save them time and money in the long run. 

Customer Retention

Customer retention is the ability to retain customers over time. This concept is a percentage of how many customers are retained and focuses on the long-term strategy of good relationship management practices. 

The best consumers don’t just buy one product or use your service once. The average repeat customer spends 67% more in the 31st-36th months of their relationship with a business than in months 0-6. Therefore, customer relationship management is a slow, consistent process that needs to be encouraged and nurtured.

Not only do repeat customers come back again and again, but they also refer more people and bring in new business. Ask for regular feedback from the entire customer team. Once buyers develop a sense of trust, the word will spread.

Implement the Right Tools

CRM tools are the most extensive and fastest-growing enterprise application software category. Around 65% of businesses adopt these customer platforms within the first five years. Proving there is a clear need for companies to work with large volumes of customer data all in one place. 

These software tools allow you to see the entire customer journey in a way that has never been possible in the past. Choosing the correct software for your business centers around your goals, how you implement your customer experience, individual processes, and reporting capabilities. 

Over the past 5-10 years, customer relationship management has become a vital part of sales and marketing initiatives to develop engaging customer experiences. Receiving consistent, up-to-date, reliable information is critical for optimizing your systems, processes, and understanding of your customers. 

If you’re looking for more helpful tips, the FINSYNC blog is a great resource to learn more about industry trends and other tools to help your business succeed.