CFI.co Blog - Business, Finance, Economics

With more governments and individuals taking resource scarcity and environmental degradation seriously, the 20th-century model of “take, make, dispose” is no longer seen as tolerable, let alone sustainable. Amidst countless approaches now being taken to reduce manufacturing waste and environmental impacts, the idea of a circular economy has proven to be among of the most influential.

Rather than relying on endless extraction and consumption, circularity encourages businesses and other major institutions to reimagine products, services, and value chains with both longevity and resource efficiency in mind. In a way, this idea harkens back to the days before mass manufacturing, when there were major efforts at all levels to recover and repurpose materials in products that reached their “end of life.” However, with the benefits of modern technology and insights, the potential for cost savings and reductions in environmental impact can be more profound, even as regular people’s access to commodities is increased.

The idea is certainly not new, and many businesses and governments have played around with it over the years. However, the case for embracing circularity has never been stronger. It’s no longer just startups with environmental and social goals who are into the idea, but regular businesses as well. The recent availability of such strong incentives as carbon credits and circular economy financing have caused even traditionally resource-hungry sectors like manufacturing, retail, construction, and even leading-edge electronics to slowly move towards a circular model.

In Singapore, profits and green business methods are being knit closer thanks to an increasing array of publicly-funded incentives. With private financial institutions starting to pitch in, it would be a mistake for local businesses to ignore the potential of circular models. When you’re ready to take your first steps, use this practical guide to keep your move sustainable.

1) Map Your Supply Chains

Before you can redesign your business for circularity, you’ll need a clear understanding of where your materials come from, how they’re used, and what happens to them after. This process, often called “material flow mapping” or “material flow analysis,” helps you identify key inefficiencies as well as opportunities to recover or extend the life of resources.

While chiefly an issue of procurement and operations, as a general rule, it’s a good idea to involve all departments across your organisation in this exercise. The more detailed your resource map, the easier it is to spot low-effort areas where circular principles can be applied most effectively.

2) Design for Repair, Longevity, and Reuse

Building for single-use or rapid planned obsolescence has been de rigueur since at least the early 20th century, when the Phoebus cartel conspired to shorten the lifespan of lightbulbs. However, consumers have become increasingly wary of products that are built to fail, even when they come at lower prices. Given this, there is a real demand for products that are both durable and repairable.

Aside from wasting fewer resources, an approach focused on repairability and durability also supports a variety of circular pathways. Such an approach allows for refurbishment, remanufacturing, or modular upgrades that can give your offerings a longer useful life. It can also open the door to new revenue streams, such as repair services or certified second-hand product sales. “Brand love” can also increase as products are able to serve their owners for far longer.

3) Shift Towards Product-as-a-Service Models

Instead of selling products outright, many retail-focused businesses are now adopting subscription or leasing models. Already, such services as furniture rental, industrial tool leasing, and cloud-based software-as-a-service are gaining popularity among SG businesses.

Because product-as-a-service keeps ownership responsibilities with the business, better maintenance and resource usage are incentivised, effectively increasing the lifespan of products and keeping them away from premature ends in landfills.

4) Recover Value from Waste

Speaking of landfills, a good deal of usable materials ends up in landfills each year. In Singapore, where landfill space is limited and waste management is under increasing scrutiny, structured resource recovery at business sites can massively save on procurement costs, all while improving environmental performance metrics and compliance. The National Environment Agency (NEA) offers insights into waste minimisation and recycling strategies that can make a major difference when deployed at your business.

5) Optimise Reverse Logistics

If you’re taking back used products or materials for refurbishment or recycling, you’ll incur costs for these activities. For that reason, having a reliable and cost-effective reverse logistics system should be part of any such initiatives. In these cases, rethinking your delivery networks to enable efficient collection, return, and reintegration into production loops will be necessary.

While building this infrastructure can seem daunting, it’s increasingly feasible thanks to third-party logistics providers and off-the-shelf digital tracking systems. If properly executed, reverse logistics can turn what would have been end-of-life liabilities into valuable returns.

6) Engage Suppliers and Partners in Circular Goals

No business model exists in a vacuum. As with any serious business initiative, a shift to a circular business model requires some cross-organisational collaboration.

Start by reviewing supplier contracts and sourcing policies. Partners committed to sustainable practices can go a long way in helping you achieve consistent circular outcomes.

7) Tap into Green Finance Opportunities

Circular business models are now eligible for a growing number of green finance instruments. Whether it’s sustainability-linked loans or transition finance, you can find state-owned and private financial institutions that can provide at least some of the capital needed to make a shift financially viable. Singapore’s financial institutions have taken the lead in this space, with a number of banks offering targeted support for all types of businesses.

Circularity Is Worth the Investment

Even in the best of times, a circular business model isn’t going to be a quick fix. It will inevitably require investing in new expertise, skill sets, and technologies, potentially at a much higher cost than simply going with the status quo—at least, for the time being. The long-term payoffs are substantial, with lower running costs, improved brand equity, and consistent alignment with both national and international goals.

If you’re planning to set up shop in Singapore, now’s the time to see what opportunities are in store. With the city-state and local financiers now going all-in on sustainability, businesses that embrace circular practices early stand to benefit, not just from preferential funding and regulation, but a future-ready market position in the region’s most powerful economy.

Budgeting

The Role of Financial Planning in Building Sustainable Futures: Strategies for Lasting Impact

ByCFI.co Blogger

In today’s rapidly changing world, financial planning isn’t just about securing our immediate needs; it’s about laying the groundwork for a sustainable future. As we face challenges like climate change and economic instability, effective financial strategies can empower us to make informed decisions that benefit both our wallets and the planet.

By prioritizing sustainability in our financial planning, we can create a positive impact on our communities and the environment. This approach not only helps us achieve personal financial goals but also contributes to a more resilient economy. For many individuals and families, working with trusted advisors like Stonewater Financial offers the guidance needed to align financial strategies with long-term values. Together, we’ll explore how thoughtful financial planning can lead us toward a brighter, more sustainable future.

Understanding Financial Planning

Financial planning involves developing strategies to manage our finances effectively and sustainably. It plays a crucial role in navigating uncertainties while supporting our long-term financial goals.

Definition and Importance

Financial planning is the process of assessing our current financial situation, setting future objectives, and devising actionable strategies to achieve them. Its importance lies in fostering informed decision-making, ensuring we remain proactive rather than reactive in our financial journeys. By understanding our financial landscape, we can create tailored plans that address our unique needs and preferences. Effective financial planning not only helps us secure our individual futures but also contributes to a stable economy, making it vital for every person and community.

Key Components of Financial Planning

We identify several key components essential for comprehensive financial planning:

Budgeting: Establishing a spending plan that aligns our expenses with incomes can streamline financial management.
Savings: Allocating funds for emergencies and future investments ensures we remain financially secure.
Investing: Diversifying investments across various asset classes helps us grow wealth over time.
Retirement Planning: Preparing for retirement through specific savings and investment strategies safeguards our financial well-being during our later years.
Insurance: Protecting our assets and income with the right insurance policies reduces financial risk.

Integrating these components empowers us to build resilient financial strategies that align with sustainable goals.

The Impact of Financial Planning on Sustainability

Financial planning significantly influences sustainability across multiple dimensions, including economic, environmental, and social aspects. By integrating sustainable practices into our financial strategies, we enhance our ability to achieve long-term goals and create positive community impacts.

Economic Sustainability

Financial planning fosters economic sustainability by enabling us to allocate resources efficiently. We can identify investments that not only yield returns but also support local economies and sustainable businesses. For instance, prioritizing investments in green technologies promotes job creation while strengthening our financial futures. Budgeting helps us track and adjust spending habits, ensuring we remain within our means while re-investing in sustainable practices. Prioritizing savings and using financial instruments such as green bonds contribute to a resilient, sustainable economy.

Environmental Sustainability

Integrating environmental considerations into our financial planning promotes sustainability and reduces our ecological footprint. We should prioritize investments in renewable energy, energy-efficient technologies, and sustainability-focused companies. Understanding the potential impacts of our financial choices on the environment guides us toward responsible consumption and resource management. For example, choosing sustainable funds or carbon-offset investments enhances our portfolios while supporting ecological initiatives. Incorporating environmental metrics into financial assessments helps ensure our financial decisions align with sustainable development goals.

Social Sustainability

Social sustainability relies on sound financial planning to support equitable resources distribution and community development. We must allocate funds to initiatives that address social inequalities, such as affordable housing and education. Additionally, supporting businesses with fair labor practices strengthens community ties and promotes social stability. Financial strategies that include philanthropic contributions or investment in social enterprises can enhance our social impact and create lasting change. By employing socially responsible investing methods, we encourage growth in sectors that prioritize community well-being alongside financial returns.

Strategies for Effective Financial Planning

Photo by Kisetsu Co on Unsplash

Effective financial planning involves strategic actions and intentional decision-making. We can enhance our financial futures by implementing proven strategies across different aspects of financial management.

Setting Financial Goals

Setting clear financial goals provides direction for our financial planning efforts. We should establish specific, measurable, achievable, relevant, and time-bound (SMART) goals. For example, we set a goal to save $10,000 for a home down payment within five years. Each goal should align with our long-term sustainability values, enabling us to prioritize initiatives like supporting local businesses or investing in green technologies. Regularly reviewing and adjusting these goals helps us stay on track and adapt to changing circumstances, ensuring our financial choices contribute to a sustainable future.

Creating a Budget

Creating a budget serves as the foundation of effective financial planning. We can track our income and expenses by categorizing our spending and identifying areas for improvement. For instance, we allocate a portion of our budget toward eco-friendly products or sustainable investments. Emphasizing transparency in our budgeting process helps us make informed decisions about discretionary spending while prioritizing savings for future goals. Regularly reviewing our budget allows us to adapt and remain committed to financial health, which fosters a sustainable lifestyle and community support.

Investing for Sustainability

Investing for sustainability enhances our financial growth while contributing to environmental and social welfare. We focus on environmentally responsible investment options such as renewable energy, sustainable agriculture, and socially responsible funds. By diversifying our investment portfolio with these options, we align our financial strategies with our values, promoting positive change. Regular monitoring of our investments ensures they not only yield financial returns but also support sustainable initiatives, making our financial impact more meaningful while fostering long-term resilience.

Challenges in Financial Planning for Sustainability

Financial planning for sustainability faces several significant challenges that affect our ability to create robust strategies. Understanding these obstacles helps us navigate the complexities of sustainable financial decision-making.

Market Volatility

Market volatility presents a considerable challenge in financial planning for sustainability. Fluctuations in asset values can disrupt long-term investment strategies focused on sustainability. For instance, sudden changes in fossil fuel prices or shifts in regulatory frameworks can lead to unpredictable returns on green investments. We must incorporate risk management strategies that account for market fluctuations, ensuring our plans remain resilient amidst uncertainties. Diversification across various sustainable asset classes, such as renewable energy or green bonds, strengthens our portfolios against volatility while aligning with our sustainability goals.

Regulatory Changes

Regulatory changes further complicate financial planning for sustainability. Governments frequently update policies related to environmental standards, incentives for sustainable practices, and taxation. These changes can impact the viability of sustainable investments and alter the financial landscape significantly. Staying informed about evolving regulations enhances our ability to adapt our financial strategies accordingly. Engaging with financial advisors who specialize in sustainable practices ensures we remain compliant and maximize potential benefits from available incentives, such as tax credits for green investments.

Access to Resources

Access to resources poses another challenge in planning for sustainability. Limited availability of financial products that prioritize sustainability can hinder our ability to invest in environmentally friendly initiatives. Certain sectors, such as local green technologies, often struggle to attract funding. We must advocate for increased access to sustainable investment options and work with financial institutions to develop products that align with our sustainability goals. Networking with organizations focused on sustainable development can also connect us to valuable resources, facilitating our pursuit of eco-friendly financial strategies. For deeper insights, check out resources from the National Endowment for Financial Education.

Banking

9 Important Questions to Ask When Building Your Credit Portfolio

ByCFI.co Blogger

Your credit portfolio refers to the collection of credit accounts that you manage. Some of the most common components of a credit portfolio are credit cards, personal loans, and other forms of borrowing. It plays a crucial role in your financial health, affecting your credit score, purchasing power, and ability to secure future loans. Thus, just as you curate your investment portfolio to suit your financial goals and risk appetite, you should also structure your credit portfolio to match your needs and circumstances.

9 Important Questions to Ask When Building Your Credit Portfolio

To build a portfolio that supports your financial well-being, ask yourself the following key questions:

What Are My Financial Goals?

Before applying for any credit product, consider what you aim to achieve. Are you looking to build your credit history, finance a major purchase, or consolidate debt? Your objectives will determine which credit options suit you best.

For example, if you’re keen on using a credit line to finance your everyday purchases, then it might be in your best interest to initiate a quick and easy credit card application process with a trusted institution. Having a credit card like the Landers Cashback Everywhere credit card by Maya, for example, will allow you to consolidate all your everyday expenses in one place so you can track them in a glance. Meanwhile, a personal loan could be more suitable for funding a business or education expenses. Understanding your financial goals ensures that you choose credit products that align with your long-term plans.

What Types of Credit Should I Include?

A well-balanced credit portfolio includes different types of credit that serve various purposes. For instance, credit cards allow flexible spending but require careful management to avoid high interest charges. Meanwhile, installment credit like auto loans or mortgages involves fixed payments that contribute to a stable repayment history. Using different types of credit wisely can enhance your credit score and demonstrate responsible credit management.

What Are the Interest Rates and Fees?

Interest rates and fees can significantly impact the cost of borrowing, so compare your options carefully by looking at their annual percentage rates (APRs), late payment fees, and other charges. Some credit products may offer promotional rates that increase after an introductory period, so read the fine print to avoid surprises. It’s in your best interest to choose credit accounts with favorable terms, as this will help you save money and maintain financial stability.

How Much Credit Can I Afford?

Borrowing responsibly ensures that you can meet your financial obligations without jeopardizing your cash flow. If you take on more credit than you can manage, this can lead to financial strain and damage your credit score. As such, make it a point that your credit limits align with your repayment capacity. Use the debt-to-income ratio as a guideline—most financial advisors recommend keeping debt payments at or below 30% of your income.

How Will My Credit Portfolio Affect My Credit Score?

Your credit portfolio influences your credit score in several ways, as it can impact your payment history, credit utilization, and length of credit history. Knowing this, use your credit lines to your advantage by maintaining low balances and making timely payments. Keeping old accounts open can also benefit you, as this can help boost your score. On the other hand, applying for multiple types of credit in a short period can lower your score.

What Are the Repayment Terms?

Each credit product has specific repayment terms that dictate how and when you need to make payments. A fixed repayment schedule offers predictability, while a flexible term may allow you to adjust payments based on your financial situation. Understanding the repayment conditions of your credit accounts will help you plan your budget and avoid unnecessary penalties.

Do I Need to Improve My Credit History First?

If you have a limited or poor credit history, you may need to work on improving it before taking on additional credit to expand your portfolio. Some ways to boost your credit history include making consistent on-time payments and reducing outstanding debt. Applying for a secured credit card can also help build a positive track record.

What Happens If My Financial Situation Changes?

Events such as job loss or medical emergencies can impact your financial circumstances. Ideally, your credit portfolio should be able present you with options that provide flexibility, such as deferment periods or lower interest rates during financial hardship. Planning for uncertainties ensures that you can manage your credit responsibly even during difficult times.

How Will I Monitor and Manage My Credit Portfolio?

Having a credit portfolio alone won’t do much for your financial security and stability. You have to be actively managing it to maximize its benefits. To do this, get into the habit of reviewing your credit accounts; this will help you stay on top of payments, track your spending, and identify any unauthorized charges. You should also set up alerts for due dates and monitor your credit report to prevent missed payments and detect fraud early.

Building a well-structured credit portfolio gives you peace of mind and access to better financial opportunities. By carefully selecting and managing your credit accounts, you can achieve financial stability and be prepared for future financial needs. Thoughtful planning today and building a strong credit portfolio can help you attain a secure and flexible financial future.

Business

4 Practical Tips to Improve Your Business Process Management

ByCFI.co Blogger

An effective business process management strategy is important to any business’s success at any growth level. If you’ve been in business for some time, you understand how crucial it is to systematically analyze and optimize workflows every so often.

Improving your business process management strategies can help eliminate bottlenecks, improve productivity and customer satisfaction, and reduce costs. Below, we’ll look at four practical tips for improving business process management for a more efficient business.

Analyze Existing Strategies

Analyzing existing strategies helps you identify gaps and inefficiencies so you can create a list of practical improvement strategies. You can hire business analysts who understand how to use quantitative and qualitative approaches to gather data on your existing strategies.

These approaches may include cause-and-effect modeling and measuring each process’s contribution to the business to identify efficiencies. A complete, effective analysis will provide the data you need to take the next step, as you will now know which processes are least efficient.

Set Your Improvement Goals

The best approach to addressing the inefficiencies you identified in your existing processes is to set and pursue SMART (Specific, Measurable, Achievable, Realistic, and Time-bound) goals. You can break down targets and goals for every department and team to achieve within a stipulated period. This will help you achieve more success quickly and increase your chances for overall improvement and growth.

Remember, each player in your team is a crucial asset in realizing your business’s overall goal. Ensure each member is fully equipped through training and resources to pursue the goal targets assigned to them.

Automate Workflow as Much as Possible

There’s no arguing that automated processes can speed up business operations and improve customer satisfaction. However, you must know what processes to automate and how to do it effectively for optimal return on investment.

For instance, if you’re in the service industry, you’re more likely to benefit from technologies like cloud computing, augmented and virtual reality, chatbots, and virtual assistants. Leveraging these technologies can help you meet client needs much more efficiently anytime, anywhere they are.

Similarly, if you sell products through an e-commerce app, you can optimize sales through the OCR SDK technology. The tool integrates with your e-commerce app for easy customer data scanning and secure payment processing. Automating these processes can free up some time, allowing your team to commit to other, possibly more important, tasks.

Focus on Quality

Meeting every customer’s demand might be impossible, but if most of your customers find your products or services unique and sufficient, you’re on the right track to growth. Satisfied customers are most likely to return, and they often don’t return alone. Other customers will simply refer family and friends to your business based on the high-quality service they received.

Every business process improvement must target customer satisfaction. Developing a new strategy with your customer in mind is the quickest route to achieving optimal returns on investment. Ensure your team understands this and that each team member plays their part, ensuring the customer’s needs are met at each level of the improvement process.

The business processes that worked effectively last year might not be effective enough in a new year. It’s important to review what’s working and improve what’s not so your business can maintain an upward trajectory every financial year.

Insurance

Should You Go Big Or Small When Choosing Life Insurers?

ByCFI.co Blogger

Focusing purely on size when evaluating the companies from which you request life insurance quotes would almost certainly turn out to be a mistake. However, as the pros and cons associated with small and large insurers apply to almost all market participants equally, it’s definitely worth considering size at some point in your evaluations. Below, we explore the most important pros and cons associated with the minnows and behemoths of the insurance world.

The Importance of Size When Evaluating Life Insurance Quotes

If you’re wondering whether a large or small concern will turn out to be the best choice when evaluating life insurance quotes in Australia, we can tell you that it really depends on your priorities. There are pros and cons associated with each choice.

Large Insurance Companies

Among the most obvious advantages of dealing with a large insurer when soliciting life insurance quotes are the following:

Wider Selection – Larger insurers normally have a wider range of products and product options from which to choose.
Stability – Larger organisations are usually more financially stable, enabling them to satisfy big claims without issue.
Better Customer Service – Large insurers are often in a position to offer a higher standard of customer service.

The most important disadvantages to consider when evaluating life insurance quotes from larger insurers include:

Impersonal Service – A less personalised service and longer wait times when calling for assistance can be expected in some cases.
A Less Flexible Approach – When negotiating terms and conditions with larger concerns, a less flexible approach is often encountered.

Now, let’s consider the pros and cons associated with soliciting life insurance quotes from smaller insurers.

Small Insurers

Smaller organisations offer several potential advantages to people seeking competitive life insurance quotes:

Tailored Services – Smaller insurers can provide a more personalised service. They are also more likely to be local, making face-to-face meetings a distinct possibility.
Flexible Terms – There is often the possibility of negotiating custom terms and conditions when dealing with smaller insurers.

Among the potential disadvantages of soliciting quotes from smaller insurers are the following:

Smaller Range – If you decide to request life insurance quotes from a local insurer rather than a larger organisation with a national presence, you may find that you have a more limited range of products from which to choose.
Less Secure – Smaller insurers are more vulnerable to major financial shocks. A run of large claims could prove devastating to a smaller concern with access to fewer resources.
Limited Customer Service – Smaller companies are less likely to offer out-of-hours services, which can make the claims process somewhat more arduous.

Some of these disadvantages may be more important to you than others, depending on your priorities and circumstances.

Making Your Choice

The best way to determine whether a large or small insurer is the best option for you is to consider the importance of the above-mentioned pros and cons from your perspective. Having weighed each factor carefully, you will be able to make an informed decision.

Budgeting

4 Tips for Avoiding a Debt Default

ByCFI.co Blogger

When you have personal goals you want to accomplish, but lack the financial resources to reach them, borrowing money would be a logical step to consider. There’s nothing wrong with going into debt so long as you pay your dues in time and ensure that the money you’ve borrowed is used to fund necessities. It becomes a problem when you’ve found yourself so deep in debt that you have no way of paying back what you owe.

Defaulting on debt takes a heavy toll on your financial future. You may be disqualified from applying for future loans and your financial options become limited when creditors are no longer confident in your ability to make on-time repayments, let alone your capacity for financial responsibility. You wouldn’t want that to happen, especially if you plan on securing a mortgage or paying for medical emergencies. Avoiding a debt default is crucial so here are a few tips to help you steer clear of that:

1. Understand your financial position

The key to avoiding defaulting on your debts is to get a clear picture of how deep a hole you’ve entered. Understanding your current situation will help you make sense of your current earnings and liabilities, allowing you to develop a strategy that will keep you from failing your creditors. Consider the total amount of money you owe to all of the individuals and institutions you’ve borrowed from.

It also matters to consider how much of your monthly income goes to repayments on student loans, your mortgage, as well as your current auto loan. You might be overwhelmed by this, but it’s crucial to help you adjust your spending habits and review debt relief strategies you can opt for.

2. Come up with a budget

Considering how severe the amount of debt you owe to several creditors, you may have to consider setting a manageable budget. As you take your earnings into account, consider prioritizing your repayments. The rest of your earnings should go towards essentials as well as a dedicated savings account.

Doing this will help you commit to your repayment schedules without having to sacrifice daily necessities. However, for this to work, you need to build enough discipline and control how much you spend on non-essentials, such as eating out and shopping for new clothes. Unless you have a large enough window in your financial posture, you might as well stay frugal until everything becomes manageable.

3. Opt to negotiate with your creditors

In case you owe too much across multiple lenders, you may still struggle to stay within your budget and keep yourself from spending over and beyond your ceiling. If that’s the case, you can always reach out to your creditors and see if you can get them to reduce your liabilities.

The best case scenario is when they approve to reduce your monthly dues, but this will reflect badly on your credit record. You just have to make the most of the window you’re given or else you’ll push yourself to a corner with no other recourse in sight.

4. Get a professional to walk you through

Most countries would give citizens options to deal with too much debt or suffer the consequences if they still fail to settle their dues. In South Africa, if you’re asking yourself, “what is a garnishee order”, it’s simply a legal right for any creditor to get a portion of your paycheck and deposits through your employer or bank.

You wouldn’t want that or any strategy to happen to you, so it helps if you could undergo a debt review with the help of a financial advisor. This works well if you start missing your repayment deadlines or you have accumulated a higher-than-average debt-to-income ratio.

Endnote

There’s no shame in being in debt, but being on the brink of defaulting could financially paralyze you. Consider these tips and start embracing financial freedom!

Business

6 Tips for Financing Your Business’s Growth

ByCFI.co Blogger

Running a business is a cyclical process of investing and reinvesting. While you aim to maintain a positive profit margin, you should also think about planning for the long term. You wouldn’t want your business to stay stagnant as the competition in your market intensifies and new trends come along.

growth

Having a growth mindset enables you to stay for the long haul, allowing you to build a business that grows beyond borders and penetrates unfamiliar markets. The key to that is financing. You can’t think about growing your business if you don’t have enough to bankroll the development of new products or the construction of branches in other locations. With this in mind, let’s look at a few things to consider as you prepare to put together a plan for exponential growth:

1. Assess your financial needs

You wouldn’t want to come up with a plan that doesn’t take into account the problems and issues you’re facing. Without insight into your present financial situation, you won’t be able to narrow down your strategy for seeking additional resources to fuel your business’s growth. For this reason, consider how much money your business is making minus the amount of money that goes towards operational expenses.

Growing your business won’t be possible at the moment when you’re paying too much to keep it afloat. It also matters if you can conduct financial forecasting wherein you gather past and present financial statements and analyze current market trends. This enables you to determine whether your business will stay profitable within the next year or so.

2. Review your business model

Aside from checking your business’s financial situation, you will also need to take a step back and look at your current business model. Focus on the ways it’s making money and assess its strengths and weaknesses. It’s possible that your business model worked well in the first few months of launching but when faced with market disruptions, it becomes a hindrance to growth and innovation.

In most cases, a complicated business model discourages investors and costs more to maintain. If that’s the case, then you might want to consider changing the entire setup. You don’t have to reinvent the wheel. All it takes is to simplify your business without affecting the value that your products and services bring. This opens you up to new windows for attracting growth capital.

3. Know what growth involves

Increasing your business’s profits is the main objective, but you need to double down on tangible goals. That way, you can allocate resources effectively as you invest in things like a quality workforce or high-end manufacturing equipment.

If your main goal is to recruit the best talents, you may need to offer competitive compensation packages and reach out to services like Triton Canada to help conduct accurate criminal record checks. With such insights, you will have a better understanding of how much financing is needed to accomplish your growth goals.

4. List down possible financing sources

Once you know your business is ripe for expansion, you need to know who and where to reach out for growth capital. The most accessible option is to apply for a business loan. There are lenders offering loans that are meant for expansion activities like building a new facility or purchasing high-end equipment. Shop around for loans that match your financial needs, making sure the terms won’t eat into your profit margins.

Aside from loans, you can also reach out to investors who would offer money to fuel your business’s growth in exchange for a stake in the company. This is the case for venture capital firms that focus on businesses with the potential for long-term success. However, be careful when you’re acquiring growth capital from these investors. There’s a good chance that you would be bought out of the business as it enters its peak.

5. Capitalize on your network

Your business won’t grow past its threshold through capital funding alone. Expansion also relies heavily on how well you can forge partnerships and connections across markets and borders. If part of your growth strategy is to build a presence in another country, then it pays to have growth partners on site who can help you look for local investors who can secure everything you need to get started.

With this in mind, don’t shy away from any opportunity to grow your professional network. Take part in live or online events such as trade shows and conferences where you can introduce your brand and the profitable potential of the products or services it sells. From there, you might as well open up doors leading to grants, investment proposals, and loans with favorable terms.

6. Monitor and assess your business’s trajectory

Once you have put your growth strategy into motion, it’s only a matter of determining whether you’re making the most out of the time and resources you put into your game plan. Tracking your business’s growth is critical to knowing whether your activities yield actual returns or lead you toward massive liabilities.

Consider setting up key performance indicators that allow you to quantify growth. You may want to focus on how well your new branch is attracting new customers. It also helps if you can monitor operational expenses and even social media engagement rates. These indicators will help you analyze your business’s tolerance for growth and make adjustments that will keep your business on the right track.

Endnote

Financing your business’s growth is a process you must undergo if you want to remain a major player in your sector. Consider these tips and give your company the momentum it needs to outgrow the competition!

Budgeting

5 Ways to Get Over Anxiety When Applying for Your First Credit Card

ByCFI.co Blogger

Getting your first credit card is an exciting prospect, as it gives you access to a powerful financial tool that can change the way you manage your finances. That being said, it can be nerve-wracking to wait for the card issuer’s approval. You might start to second-guess whether or not your application will get accepted, much less get a decent credit limit for your first credit card.

To alleviate these worries and increase the chances of your application getting approved, here are some steps you can take before and during the application process.

Do Your Research

Lack of proper information can easily make you feel unprepared about the entire credit card application process, which can prompt more anxiety than necessary. Hence, make sure to do your research before you fill out your first-time credit card application Philippines form. Keep in mind that not all credit cards are the same, so it’s important to know if the one you’re planning to get is truly what you need. Ask yourself, “What do I want out of a credit card?” and start your research from there. Understanding your personal financial goals can build up your confidence as you apply for a credit card.

You should also check if you meet the minimum qualifications and requirements of the credit card you’re applying for as well. For example, most credit card providers require the applicant to be a Filipino citizen between the ages of 21 to 70 years old and have a steady source of income (whether as an employee or as a self-employed individual) for at least 2 years. If you’re too young or have no job experience at all, then it’s best not to apply yet because your application will most certainly be rejected.

Have All the Required Documents On Hand

Most credit cards have the same documentary requirements, such as a valid government-issued ID, a certificate of employment, and a proof of income in the form of payslips, your latest income tax return (ITR) document, or a registration document for your business. Your proof of income is especially important, as it can help the credit card provider determine if you have the capacity to pay. Make sure to prepare all of these documents even before you download or print your application form to make the entire process a little less stressful.

Do note that some credit card providers also allow you to apply with little to no documents required if you have other qualifications. For instance, you can apply for Maya’s Landers Cashback Everywhere Credit Card through the Maya app with no documents required if you have an active Landers membership. So, if you’re already a Landers member and don’t have a credit card yet, this credit card may be a good option for you.

Double Check Your Application

Credit card application forms, particularly the ones issued by traditional banks, can be overwhelming at first glance given how dense they look. This may make you feel anxious or worried that you will make a mistake or miss a detail. To allay those concerns, always double-check your application before sending it. This goes for online applications as well, as it can be just as easy to make typographical errors as you input your details.

Rest assured that there’s no time limit as you fill out the form, so you don’t have to be pressured about doing it quickly. Instead, take your time to understand each required field to avoid making mistakes.

Talk with a Family or Friend Who Owns a Credit Card

After you’ve submitted your credit card application, waiting for the card issuer’s response can make you uneasy. The evaluation can take a while, sometimes a week or even longer, depending on the type of card you’ve applied for. Rather than ruminate over what-ifs, it’s much better to get your facts by talking with a family member or friend who already owns a credit card. They can clue you in on how long the application process usually takes, as well as what other things to expect, such as how the card will be delivered to you and how to activate it. Having a clear picture of how the process goes can help eliminate the uncertainty and make you feel more reassured as you wait for your application’s result.

Don’t Hesitate to Ask Questions

If there’s anything you’re confused about at any point of the application process, don’t hesitate to ask the banking staff or a customer service representative to clarify it for you. After all, it’s much better to know the answer straight from the source than to worry about it for days on end. Even after you’ve gotten approved and have received your card already, rest assured that you can always reach out to your credit card provider for questions. After all, they stand to benefit from you getting the most out of your credit card, as much as you would benefit from it.

While the nervousness that comes with applying for your first credit card is normal and almost inevitable, there are many ways to diminish those feelings. Let the tips above guide you through your first credit card application to make the process less intimidating.

Finance

Revolutionize Your Investments with Automated Trading Solutions: A Guide for Startups

ByCFI.co Blogger

Startups today face a relentless market. Finding an edge is crucial, and often, that edge comes down to efficiency. If you’re part of a growing fintech-focused startup, you’re likely familiar with the constant push to stay ahead. Traditional trading methods simply don’t cut it anymore—human error, slow reactions, and emotional bias all play a role. But there’s a way to change that.

Enter automated trading solutions.

Automated trading systems have been around for a while, but they’ve grown more sophisticated, accessible, and essential for startups looking to sharpen their investment strategies. They can transform the way you approach both short-term and long-term investments. And yes, like it or not, the machines are here to make money fast—but only if you know how to harness their full potential.

So What Exactly Is Automated Trading?

Not as complicated as it sounds. Automated trading solutions allow you to set a predefined set of rules or conditions for buying and selling assets. These platforms take control once set up, executing trades at high speed when certain conditions are met, without the need for human involvement.

Think of it like programming a robot to react instantly to shifting market indices. It eliminates the fear, bias, and emotion from investment decisions—something humans are notoriously bad at avoiding. Instead, decisions are based purely on logic.

No hesitation. No reconsideration. Just execution.

Why Does It Matter for Startups?

There’s a simple truth to startups: resources are tight. You don’t have the luxury of large teams, and spending hours “figuring out” the market just isn’t sustainable. Time is money, especially when you’re trying to scale. Automated trading offers a way to cut back on manual efforts, while still delivering results that a team of human traders could produce—if not better.

Without automation, every trade becomes a manual decision, meaning you or whoever is in charge of investing has to spend valuable time researching, reacting, and balancing strategies. This just doesn’t resonate with the fast-paced, “fail fast, fail often” mantra most startups live by.

Additionally, automated solutions help mitigate risk. Humans panic, markets shift, and then poor decisions follow. Automation allows trades to happen based on data, not on impulse.

Getting the Most From It Without Risking Everything

Here’s the thing about automated trading: it’s not foolproof. Just because it’s automated doesn’t mean it’s a “set-and-forget” solution. There’s still strategy involved. You need to stay on top of trends, and you need to know when to tweak your rules. Following the market without any human oversight is a guaranteed way to get burned eventually.

Start simple. Start by using the automation to complement—not replace—human discretion.

Backtest your strategies. Most platforms enable backtesting, meaning you can simulate how the strategy would have worked based on past data. The market doesn’t behave exactly the same way over time, but if you’re noticing red flags in your simulated results, it pays to revisit your automation setup.
Set risk parameters. There’s no reason why automation should accelerate loss. Make sure you’ve got strong stop-loss triggers in place and that you’re not investing money you can’t afford to lose. The bigger the risk, the bigger the potential burn.
Start small. You’re trying to make an impact, but diving headfirst into full automation can lead to headaches. Scale gradually, testing as you go along. Understand the nuances—nothing replaces learning from real-world experience.

Conclusion

Not every startup is the same, and you need to assess if automated trading aligns with your goals. If you’re bogged down by manual processes, automation will free up time, allowing your team to focus on innovation, strategy, and scaling. However, it requires a degree of trust and regular monitoring to ensure it fits with your general business goals.

The bottom line is this: bringing an automated trading solution into your startup could be game-changing, but success won’t come just by turning on the machine. Plan carefully, and use the time it saves wisely.

The future is automated—but only winners know how to use it right.

Sources:

https://www.investopedia.com/articles/trading/11/automated-trading-systems.asp

https://www.ig.com/en/trading-platforms/algorithmic-trading/what-is-automated-trading

https://www.investfly.com/

Finance

5 Ways to Tell If a Stock is Undervalued

ByCFI.co Blogger

We all look for an opportunity to save money through good deals, whether it is discounted purchases, clearance sales, or buy-one-get-one-free deals. The same is prevalent in stock markets. Investors are always on the lookout for quality stocks at an undervalued price. However, the greatest hurdle for many investors is identifying these undervalued stocks. This article solves this by providing the best ways to tell if a stock is undervalued.

Image from Jason Briscoe on Unsplash — *Image from Jason Briscoe on* *Unsplash*

Low Valuation Ratios

Start by identifying the stocks you are interested in and compare their valuation ratios in relation to the overall market. The bargain could be on your side if the ratios fall under that of the broad market index or industry average.

Some popular valuation ratios to adhere to during your investment analysis include price-to-earnings P/E ratio, enterprise value to EBIT, PEG ratio, and price-to-sales ratio. You can easily analyze these valuation ratios and find undervalued stocks using a stock screener.

Meaningful Decline in the Stock’s Price

If you are still unsure how to find these undervalued stocks, consider checking out those that show significant declines from recent highs. This means you have to narrow down your search to specific stocks that are notably lower than their highs to boost your chances of getting a bargain.

Always check out websites that publish a list of stocks with new 52-week lows. Once you have the lists, research the companies to gain insights into their recent performance, valuation ratios, and whether some insiders are already taking shares. You can also rely on the information provided by reputable stock trading brokers to identify stocks with meaningful declines.

Successful Investors Gobbling Up the Shares

Copying what successful people are doing can land you in a safe place in the world of investing. Professional investors with a significant amount of money in stock investments are required to file with the SEC, disclosing their holdings by the end of each quarter.

Through the filling, you can tell the positions successful investors hold and the kind of stocks they buy, which can inform your next move. While at it, conduct your own research about the stocks before buying. Keep an eye on the market to be informed if the stock price climbs or falls in between filings.

Rise in Purchases by Company Insiders

You can also tell if a stock is undervalued by checking if the company insiders are purchasing the shares. No one knows the business more deeply than the company executives. It is worthwhile to be more keen when you learn they are buying the stock.

The companies file these insider transactions with the Securities and Exchange Commission. You can find the filings on the commission’s website. While executives are usually awarded some shares as compensation, some executives buy shares with their own money, which can be a sign of a good investment.

Pay Attention to Undervalued Sectors

Another way to identify undervalued stocks is to target undervalued sectors. For instance, if the energy sector has stocks that are declining in overall price, you can invest in the declining energy stock that has the potential to grow in the long run. The stock should have a solid cash flow and less debt regardless of the sector-side downturn. This will enable you to reap the rewards of growth when the sector rebounds.

Most investors want to purchase undervalued stocks, but they don’t know how to find them. Not anymore. With these tips, you will be able to make accurate market predictions for your future investments.