Navigating 2021: how to prioritize and seize opportunities

With a challenging year behind them, businesses are poised to regroup and pursue possibilities ahead. Three experienced Citizens business banking executives recently spoke with Kat Shepherd, chapter chair of mentoring agency SCORE Inland Empire, about how to make the right choices, increase customer loyalty and find resources to succeed during this dynamic period.

How can businesses decide where it makes the most sense to invest money and resources this year?

Redwan “Red” Kabir, Citizens Senior Vice President and Business Banking Relationship Manager: Think about whether something will generate additional revenue or increase efficiency. Would a delivery person help you grow? Or, will a change like adding credit card processing capabilities help you appeal to more customers? The extra cost of these investments — in the case of credit cards, say 1 or 2% — can be well worth it. If I’m a business that has 15% or 20% margins, for instance, that 2% is manageable. If the revenue of something is greater than the cost, and it won’t pay off over time, you might want to hold back.

Kerri Miozza, Citizens Vice President/Business Banking Market Manager: Cost containment should drive prioritization and decisions this year. For example, look into whether you can secure better pricing on large expenses. Some businesses use a line of credit (LOC) to seize inventory pricing that is advantageous, for example. You don’t want to overextend yourself, but if you can use the bank’s money to stock up on inventory and get a better margin on your sales, your bottom line is going to look a lot healthier. The ability to process credit card payments securely online is also a potential game changer. The cost to get started is minimal, and it does pay off. Being able to take online payments from anywhere in the world means your business isn’t just limited to your local area, and you’ll see a return on investment.

Is customer feedback a helpful tool to determine the right direction for your business?

Paresh Mistry, Citizens Vice President/Commercial Relationship Manager: Absolutely. Your customers’ behavior should guide you. Always track their feedback, as well as their behavior and purchase trends so that you stay aligned with what matters most to them. Remember, your customers’ loyalty is ultimately what will sustain you. Knowing what they want will help you make your marketing dynamic and your company more responsive to their needs.

Kerri: Use customer input to think about what differentiates you from your competition and why people would choose your business over others. Don’t be afraid to ask your customers what you are doing well and where you can improve. If the feedback isn’t positive, don’t take it as an insult and feel defeated. Use it as a challenge to grow and learn, so you’ll get better feedback next time.

Redwan: Listen carefully to customer feedback and always address it. If someone leaves a negative comment about your business on Yelp or another social site, don’t just let it sit there unaddressed. Respond to comments in a constructive way, starting with a thank you for the input. Then, detail how you have worked or are working to change what was complained about. Customers and prospects will feel better doing business with a company that demonstrates that it cares about customer feedback and makes an effort to address problems that arise.

Should businesses be concerned about fraud, both online and offline?

Kerri: Absolutely. Fraud claims increased dramatically in 2020 with crimes focused on the Paycheck Protection Program (PPP) and fraudulent unemployment claims. If you see a transaction that is not yours, or you believe someone has access to your account and routing numbers, let your banker or relationship manager know right away. Digital debit through PayPal or Venmo are important tools for businesses to offer, but they also present some risk that you should manage. For example, taking a step as simple as setting up a reserve account to use with these platforms can separate them from your operating account. That way, if there is fraud, most of your cash isn’t affected.

Kabir: Fraudsters are focused on crime, so you need to put some effort in to protecting your company. Go back to the basics and reconcile your books on a daily or weekly basis. Change your passwords regularly. Don’t get complacent — have the right people and systems in place to keep fraud at bay.

How can businesses get customers to come back, and increase loyalty going forward?

Kabir: Incentives like points and rewards can be helpful to encourage repeat purchases and keep customers loyal. Of course, always keep an eye on the cost of these programs to ensure they are paying back through loyalty and acquisition improvements. Also, consider extending terms as a way to create loyalty. For example, if you’re a small wholesaler, you can extend 30 days of credit to retailers.

Paresh: As the economy bounces back show prospects and customers that you have the right processes in place to create a safe environment. This can be as simple as having a sign on the door outlining your practices for social distancing. You can also generate loyalty by increasing communication with your customers. If you digitized in the last year you probably have more information about customers than you used to. Use what you know about who buys from you to find more of the same type of buyer. Also, if you have asked permission, reach out to your customers with offers to thank them and keep them coming back.

Kerri: People may still have some anxiety going into the second half of 2021, and you may need to bring them back in the door or to your website with more promotions than usual. Use email, social media and other channels to advertise sales and show people what you are doing to offer a safe experience. And work with your bank — supporting business owners is what we do for a living. Think of your banker as a member of your team you can reach out to for advice on things you could change, ways to save fees or tips for generating more business. Don’t be afraid to connect with friends, family and peers in your industry for insight, to help you be thoughtful and deliberate in your decisions.