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For Startups

Impact of the CBN’s Reviewed Interest Rates on MSMEs

Introduction It is a routine for the Central Bank of Nigeria (CBN) to review rates from time to time; this is not an anomaly – it is best that I establish this fact so that it does not seem like what the CBN has done is unusual. However, this is the first time that rates are this high in Nigeria. The new CBN rates as shown in Figure 1 below highlights significant changes that have taken place and the policy directions of the new CBN, led by Mr. Olayemi Cardoso. Interpretation of the CBN’s Reviewed Interest Rates Generally, the rates impact the availability and accessibility of money (lending, borrowing) in Nigeria. They pretty much determine how much you pay to ‘borrow’ money and how much you get when you ‘invest’ your money. Specifically, for Micro, Small, Medium-sized enterprises (MSMEs), the MPR (Monetary Policy Rate) is the most significant, because the other rates directly impact Deposit Money Banks (DMBs) more than businesses. In simple terms, as a business owner or manager, you cannot access funds (except for special alternatives, which is not covered in this article) at interests less than 22.75%. CBN’s Reviewed Interest Rates: Practical Implications for Existing Borrowings Given the inevitability of credit (debts, borrowings) and its attendant interest overlay, MSMEs should begin to prepare for notifications from their Creditors (payables). Facilities obtained from regulated financial institutions are subject to these changes based on the agreed terms and conditions. Managers and owners of MSMEs should review their terms and conditions to see if the new rates are applicable. It is likely that general purpose facilities are affected. However, specialised facilities such as those obtained from the Bank of Industry or other special sources may not be affected. These terms are clearly spelt out in the conditions signed before obtaining the loans. Managers and owners of MSMEs may need expert advice to know how to respond to their creditors. But here, I give general advice: 1. Refrain from Panicking This news comes at a time that the economic landscape does not make businesses looks good – rising costs, loss of labour, increasing compliance costs amongst others. Human instinctive response might be panic, but this is not the time for panic at all. Rather, panic can aggravate your emotional condition and lead to depressive behaviours. It is best to remain calm, albeit this is easier said than done. This news will definitely draw from your emotional bank and support systems. If you have a strong one in place, the impact will be minimal. If you have a low deposit in your emotional bank or a weak support system, you might feel the impact more, but all is not lost as you can quickly ‘buy’ some deposits. I trust that there are mental health specialists that are willing and able to help you through this times.   2. Respond to your Creditor’s Communications Non-response will not make the ‘problem’ go away. It is better to keep the lines of communication open. You started on a good note with your Creditor, don’t break that relationship because of this situation – it will pass and when you look back afterwards, you will be glad you handled it better than using abandonment. I would therefore recommend that you respond to emails, calls and other means of communication. Let them know that you honour their relationships even if you are immediately unable to meet their new demands. 3. Restructure Existing Borrowings Most Creditors should be open to a restructuring especially if the new rates apply to the existing facilities. Even if they do not necessarily apply, it is better to restructure your borrowings if you can. CBN’s Reviewed Interest Rates: Practical Implications for New Borrowings This is as clear as noon day. What this means for new borrowings is that accessing loans will now come at the new rates. General purpose facilities will now go for 22.75% plus management fees and other fees. This implies that around ₦300,000.00 will be required as interest on a facility of ₦1,000,000.00 (this is only a simplification of the calculation). It is best to look out for the nitty-gritty of terms e.g., straight line or reducing balance rates, annual or monthly rates etc. so that businesses can easily prepare their cash budget to meet these obligations. A general note of advice to managers and owners of MSMEs is to determine the suitability and sustainability of this rate on their operations. If this new rate is too high for the type of business, it is better to either stay off new borrowings or source alternatives. CBN’s Reviewed Interest Rates: Practical Implications for Excess Liquidity Some businesses might be struggling to survive in this economy, while some might have excess liquidity. It is not business wise to keep excess liquidity in a business, hence businesses with excess liquidity can take advantage of this time to invest and get better returns. How then can a business know that it has excess liquidity? Liquidity is not just having money in the business account. From the bookkeeping perspective, there are two main methods used to determine liquidity. Please note that there is a significant difference between liquidity and profitability. Interestingly, there is a paradoxical relationship between both such that a business can be profitable but not liquid and another can be liquid but not profitable. Alternatively, a business can be both liquid and profitable while another can be both illiquid and unprofitable, but that is not the focus of this article. N/B: Current assets are assets that accrue to a business in the short term (less than or equal to 12 months) and they include inventory, receivables, prepayments (advance), cash and bank balances. Current liabilities are obligations that fall due in the short term such as interest payments, overdrafts, payables amongst others. Conclusion According to the CBN, this measure is to tighten some monetary indices and strain inflation. It is believed in economic circles that this decision is not for the long run, however,

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Make or Buy Decision: What Do I Have to Lose?

Business decision making is not an easy road. Ironically, perhaps unfortunately, it is a road taken way too often by both intrapreneurs and entrepreneurs with significantly threatening outcomes. It is easier to take instruction than to be the one to determine the pathways to outcomes, hence it is good to have some fore knowledge of how to take those decisions. Asides the fear of the rebound/boomerang of decisions, the fear of being able to handle decision outcomes is significant. With the current market situation, how businesses decide to either ‘make’ or ‘buy’ a component of a product/service, or an entire product/service is significant for both process and product costs including profitability and liquidity. This article focuses on both quantitative and qualitative considerations that business managers should assess before taking a “make or buy” decision. What is a Make or Buy Decision? In basic terms, a “make or buy” decision puts businesses on an uneven pedestal, much like a pendulum – wherever you swing has costs and potential benefits which can be predetermined, but actual impact is known only after the decision has been made. Few examples include the decision to ‘make’ or ‘buy’ ready-made spices, napkins, engine spares, oils, chips. For services, it might be a decision to outsource a business, HR, accounting, or other processes. For accounting purposes, it might appear easy to determine the cost of ‘buy’ decisions – product or service cost plus any incidental costs, that’s all. But for decision making, it is not that easy especially when you have to compare with a ‘make’ option. This becomes complex, because you have to imagine alternative forgone (opportunity cost, remember this from elementary Economics?) – school no be scam o. An understanding of how opportunity cost works is important in business decision making. To ensure that we can apply a critical and analytical approach to our business decisions with respect to “make or buy” decisions, below is a fictitious example. The highlighted lessons can be applied to most scenarios even very complex decision situations. MTY Ltd. is opening a new plant in Ikeja, Lagos State that would produce 500,000 units of brake discs monthly. Two suppliers of a significant component used to produce brake discs submitted a quote of ₦760.00 and ₦710.00 per unit including freight and insurance. MTY Ltd. has the capacity to produce 700,000 units of this component in their Ota, Ogun State factory, which has become out of use for over a year. The associated cost of producing one unit of the component in their Ota factory includes Materials – ₦90.00, Labour – ₦250.00, Overheads – ₦350.00. Transportation from Ota to Ikeja is currently challenged due to the state of the road. The choice to produce at the Ota factory comes with commitments to labour and environmental laws, while excess production can be sold at the open market. 3 Decision Scenarios from the Example Above 1. Buy from the cheaper supplier This looks like the best solution especially if management is looking at minimising cost. Some drawbacks to consider on this decision include quality assurance. How can MTY Ltd. verify the quality of the component as well as alignment with their brake discs specification? Would using the component require additional production cost? If MTY Ltd.’s customers are aware that a significant component of their brake discs is outsourced, would it influence their purchase decisions and how? In this era of sustainability, to what extent does the supplier align with the SDGs in their production? Does the supplier comply with government regulations and industry standards? 2. Buy from the more expensive supplier There is the bandwagon effect of higher stakes – “because it is expensive, it has to be good”. This is not always true. Management would like to justify the extra cash. Why are we paying more when we can get it for less? The other questions about compliance and customer perception are relevant here as well. 3. Produce at the Ota factory This is the make decision scenario. The quantitative cost of the component is what a Performance Manager (Cost/Management Accountant) is trained to compute based on certain principles and assumptions, which I will not highlight due to space constraints, but I will give a simplified outlook. Materials: ₦90.00 + Labour: ₦250.00 + Overheads: ₦350.00 = ₦690.00 At a glance, this looks cheaper than both ‘buy’ decision scenarios, but considering the full situation, it might not necessarily be cheaper. Transport cost from Ota to Ikeja is not included in the computation. Labour and Environmental compliance cost for maintaining the factory is not included in the computation as well as the fact that the factory has been out of use for some time which might require some repairs or upgrade. On the flip side, producing at the factory gives more assurance of quality except management deliberately desires to produce low quality components. The prospect of selling excess capacity at market price is also significant. Asides taking a part of the component’s market share, there is brand visibility that production can confer. Conclusively, there is no straight forward answer to any “make or buy” decision scenario. Availability of credit options can become an appealing and compelling consideration for ‘buy’ decisions, while quality assurance and the need for brand visibility can drive ‘make’ decisions. Businesses are advised to consult professionals before taking a “make or buy” decision as they are trained to identify areas of advantage and leverage.

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Entrepreneurship World Cup Pitch Competitions (US $1 million Cash Prizes)

Is your company solving some of the world’s biggest challenges? Entrepreneurship World Cup (EWC) wants to hear from you. About the Entrepreneurship World Cup Since 2019, The Entrepreneurship World Cup (EWC) has become one of the biggest and most diverse startup pitch competitions and support programmes of its kind, featuring more than 370,000 entrepreneurs from over 200 countries and territories while offering winners life-changing prizes. EWC has awarded $4 million in cash prizes and $150 million in in-kind prizes and provided opportunities for entrepreneurs to reach the next stage in their company’s journey. Moreover, hundreds of coaching and training hours have been delivered, along with high-value entrepreneurship programmess tailored to all three participating stages in the World Cup. Eligibility Requirements for the Pitch Competition Prizes and Awards of the Entrepreneurship World Cup For more information about this competition, click here. Apply here on or before April 1, 2024. Also Apply: HealthTech Hub Africa Accelerator

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Equipment Required for Starting a Cake Business

Launching a cake business in Nigeria is not only profitable but also exciting. Done right, it has the potential to generate substantial revenue. To ensure a smooth and professional operation, it’s essential to invest in the right equipment when setting up your business. These tools can significantly enhance efficiency, speed, and the overall quality of your work. Equipment Required for Starting a Cake Business in Nigeria 1. An Oven: A domestic oven should serve you during your startup phase. As your business expands, you can get a locally fabricated oven to make more cakes at a time, although it comes with the challenge of regulating the heat. Alternatively, you can acquire an industrial oven instead. While it is recommended that you acquire an industrial oven when you expand, you can acquire an industrial oven at the startup phase if you can afford it. 2. Mixer: The mixer eases the process of production. It is best to invest in a good one. 3. Refrigerator: For your cake business, it’s crucial to have a refrigerator to store creams and butters and to cool cakes before decorating. Download Free eBook: Setting Up a Cakes and Dessert Business in Nigeria 4. Work Table: You will need a good work surface for cutting and trimming your cakes and kneading your fondant icings. 5. Camera/Smart Phone: You need a good camera to take quality pictures of your products for advertising and publicity. Where you cannot afford a camera, invest in a good smart phone. 6. Utensils: Pans, turntable, electric scale, measuring spoons, cups, bowls, spatula, pallet knife, and basic decorating tools. 7. Raw materials: When it comes to buying raw materials, it is usually better to buy just enough raw materials for each production and then you plough back the profits after sales into the business. Do not buy materials in bulk especially when you do not have orders as this will tie down your funds unnecessarily. Please note that if you want to focus on other pastries and desserts like doughnuts, the equipment required are the same as you would use for cakes except that you may need to add some specialized pans and cutters. Download this comprehensive business guide to delve into the ins and outs of initiating and expanding a cake business in Nigeria. From initial startup costs to navigating regulatory requirements, discover everything you need to know for the successful growth of your cake venture. Culled from FATE Foundation’s Business Entry Guide on Setting Up a Cakes and Dessert Business in Nigeria.

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How to Scale Tech Companies in Nigeria

Scaling tech companies in Nigeria means growing operations to serve more customers, increase revenue, and have a more significant impact in the market while simultaneously improving efficiency and profitability. This can be accomplished by expanding into new markets, improving production capacity, streamlining processes, growing the workforce, and harnessing technology. The ultimate goal is to achieve sustainable growth, reach a broader customer base, and improve the quality of products or services. Yet, accomplishing this goal is frequently challenging for tech companies in Nigeria. They grapple with limited funding for various reasons, including their early-stage status, reliance on self-financing, struggles to attract investors, revenue difficulties, high development expenses, and the impact of economic downturns. Strategies for Scaling Tech Businesses in Nigeria Despite facing financial limitations, especially limited funding, you can efficiently scale a tech company with these strategies : 1. Effective Resource Allocation To achieve sustainable growth and efficient resource management, businesses should prioritize the development of a Minimum Viable Product (MVP) that meets essential market needs. By releasing initial versions of products, businesses can gather valuable feedback, validate ideas, and generate revenue for further expansion. Additionally, implementing cost-optimization strategies such as utilizing co-working spaces, open-source software, and negotiating favorable terms with suppliers helps businesses maximize resources and minimize expenses. By focusing on these developing an MVP and implementing cost-optimization strategies, businesses can effectively control costs, streamline their product development process, assess market feasibility, and deliver an MVP. Ongoing evaluation and refinement of these strategies are crucial for long-term success. 2. Customer Centric Growth Strategy Another essential strategy for scaling with limited funding is customer acquisition and retention. Businesses can target intended audience and broaden reach by wisely allocating resources and putting cost-effective marketing techniques like content marketing, social media, referral programs, and Search Engine Optimization (SEO) into practice. In addition, focusing on client feedback and iteration enables organizations to obtain insightful information and modify their product or service to match the demands and preferences of their customers. This iterative methodology guarantees that firms may steer clear of expensive errors and create a product that appeals to their target market, ultimately resulting in higher levels of client pleasure and loyalty. Businesses can maximize scarce resources and promote long-term success by giving customer-centric growth plans first priority. 3. Building a Strong Team and Network To succeed with minimal resources, tech companies should prioritize building a strong team and network. This involves attracting and retaining talented employees who align with the company’s vision through competitive compensation packages. Building a solid network provides opportunities to connect with mentors, investors, and industry experts, leading to access to resources, industry knowledge, and potential collaborations. Additionally, forming strategic alliances with complementary companies or competitors can accelerate expansion without high initial costs. By prioritizing team-building, networking, and strategic alliances, tech organizations can access valuable expertise, resources, and growth opportunities even with limited financial resources. 4. Business Financial Planning and Efficiency Successfully managing finances, acquiring funding, and operating a business efficiently are vital for achieving success. Key approaches include creating a realistic financial plan, closely monitoring financial matters, and exploring alternative funding sources such as angel investors and crowdfunding platforms. Enhancing operational efficiency involves streamlining processes, automating tasks, adopting project management tools, and optimizing the supply chain. Implementing these strategies leads to improved financial performance, sustainable growth, and a competitive advantage. It also ensures secure financing, increased efficiency, and enhanced financial planning. Regularly evaluating and adjusting these methods is crucial for ongoing success. Conclusion Tech companies with limited funding should strive to scale their operations strategically to achieve growth within budget constraints. Scaling offers several advantages, including capitalizing on larger market opportunities, gaining a competitive edge, achieving cost efficiencies, fostering innovation, and attracting investors. By expanding their reach, diversifying their offerings, optimizing costs, adapting to market trends, and demonstrating growth potential, tech companies can unlock their full growth potential and ensure long-term success in the competitive tech industry. Emmanuel Otori is the Chief Executive Officer of Abuja Data School. He is a Small Business Consultant, Start-Up Advisor and Consultant For SMEs across Nigeria. You can read his other articles here.

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How to Sell to a Difficult Customer

Your main goal as a business owner is to provide solutions that genuinely address your customers’ needs, ultimately enhancing their quality of life through your products. However, it’s important to acknowledge that customers have had negative experiences in the past. When a product fails to fulfill its promised purpose, it leaves customers disappointed, cautious and most likely, difficult. Consequently, customers have become more logical, meticulously evaluating their options before making a purchase. They want assurance that what they buy will truly deliver on its promises, without the need for additional purchases. So, how do you sell to a difficult customer? 1. Use testimonials Customer segments are defined by age, social status, work environment, exposure, and place of residence. One of the ways to sell to a difficult customer is to mention individuals who have purchased your products and get them to talk about the satisfaction derived from these products/services. This is to assure them that their investment is secure. Logical, difficult customers, who possess the means to spend, seek reassurance before making a purchase. Their strong network also make them influential in referring others to your products, creating a potential customer segment with continuous demand. To build trust and credibility, it’s recommended to collect testimonials for display on your website or social media channels. These testimonials can take the form of text accompanied by customer photos. Alternatively, video testimonials are powerful as they visually convey trust through body language. Keep the video clips concise, ranging from 30 seconds to 1 minute. Sharing testimonials from satisfied customers serves as a powerful means of building trust, establishing credibility and instilling confidence in potential buyers. 2. Provide customer support and utilise customer feedback When customers are unsure about how to use a product, they often seek information and guidance. Capitalize on these conversations by providing the necessary instructions and support. It’s crucial to keep records of all customer interactions, including calls and text messages. These records serve not only for monitoring and improvement purposes but also for reaching out to them. Valued customers who experience the benefits they anticipated are likely to express their gratitude. You can showcase these conversations, starting from when they sought assistance to when their concerns were resolved. This display of customer feedback demonstrates your trustworthiness and reliability. 3. Offer discounts Customers have unfortunately experienced instances where their hard-earned money was taken advantage of, causing them to be cautious about future purchases. To foster long-term relationships and bring about a significant change in their perspective, you need to shift your focus away from short-term profitability to gaining trust. Rewrite the narrative and offer them something of exceptional value, surpassing their expectations. It could be in the form of discounts or even providing the item for free if it is not a high-priced product. By exceeding their perceived value and offering them an irresistible proposition, you can sell to a difficult customer, rebuild their trust and establish a solid foundation for a lasting customer relationship. 4. Offer free complimentary services Customers often have additional needs beyond their initial purchase. As a business, you have the opportunity to provide these supplementary services alongside the discounts offered. However, it’s important to approach this in a thoughtful manner, avoiding any sense of desperation. Consider making a promise to customers that after they have used the product and experienced satisfaction, they will receive complimentary services when they make a second purchase. This promise acts as an incentive for them to return and further solidifies their positive experience with your business. By offering these additional services, you enhance their overall satisfaction and create a compelling reason for them to engage with your brand again. In conclusion, it’s crucial to remember that the ultimate objective is to win over customers. However, it’s important to acknowledge that customers have the freedom to choose whether or not to return. Regardless, your goal should be to maintain a long-term business relationship with each customer, treating them as individuals rather than as a collective group. By focusing on personalized service and catering to their specific needs, you increase the likelihood of building loyalty and fostering repeat business. Remember, every customer is unique, and your commitment is to serve them on an individual level. Emmanuel Otori is the Chief Executive Officer of Abuja Data School. He is a Small Business Consultant, Start-Up Advisor and Consultant For SMEs across Nigeria. You can read his other articles here.

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Taking Your Business to Global Markets

Taking your business to global markets is a crucial step towards achieving success in today’s competitive world. With the advent of technology and globalization, businesses have the opportunity to expand their reach beyond their local markets and tap into new customer bases worldwide. However, expanding into global markets requires careful planning and execution. The first step towards taking your business to global markets is conducting thorough market research. This involves identifying potential target markets, understanding their cultural nuances, and analyzing the competition. It is important to understand the needs and preferences of customers in different regions before launching any products or services. Once you have identified potential target markets, it is important to adapt your products or services to meet local demands. This may involve making changes to packaging, branding, pricing, or even product features. Adapting your offerings will help you stand out from competitors and increase your chances of success in new markets. Another key aspect of taking your business to global markets is building strong partnerships with local distributors or suppliers. These partnerships can help you navigate complex regulatory environments and gain access to local networks that can help you establish a foothold in new regions. Finally, it is important to invest in marketing efforts that resonate with local audiences. This may involve creating localized content for social media platforms or partnering with influencers who have a strong following in specific regions. In conclusion, taking your business to global markets requires careful planning and execution. By conducting thorough market research, adapting products or services for local audiences, building strong partnerships with local distributors or suppliers, and investing in localized marketing efforts – businesses can successfully expand their reach beyond their home market and tap into new customer bases worldwide.

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6 Post-Subsidy Strategies for Reducing Costs

Nigeria has enjoyed fuel subsidies for a long time, as early as the 1970s. However, its removal was announced on 29th May, 2023, and implemented afterwards. Subsidy removal on Premium Motor Spirit (PMS) is often associated with increased inflationary pressure. This means that every economic agent, from households to businesses will be impacted by its removal. As a small business owner, you’ll typically have to deal with higher costs of procurement, energy, logistics and raw materials. Since higher cost of doing business is a threat to profitability, and could increase business mortality rate if not well-managed, here are six (6) post-subsidy strategies for reducing costs: 1. Inventory optimisation: Produce and/or procure just the right amount of inventory required to meet demand for quick turnover and also to avoid wastage, especially for perishable items. 2. Stockpiling and batch deliveries: Encourage customers to consider stockpiling when purchasing non-perishable items to reduce delivery costs. For example, a customer might be unwilling to pay N2,000 delivery fees on an item that costs N1,500. But, if they purchase another item in two weeks, you can send both items together at the same delivery price. Also, introduce batch deliveries per location or days so that customers can share the cost of deliveries, thus cheaper deliveries. Customers who want instant deliveries will have to pay the premium price. 3. Customer retention: This is critical during inflationary periods because acquiring new customers becomes harder. Maintain cordial relationships with existing customers by offering exceptional customer service and implementing periodic loyalty programmes to encourage retention. 4. Market research: conduct market research to determine the right pricing that’ll keep your business profitable while balancing customer affordability. 5. Exploring shared resources with other businesses: Identify sector-specific entrepreneurs within your network and collaborate to purchase raw materials in bulk to reduce operational and logistics costs. 6. Exploring intervention programmes: Occasionally, intervention programmes dedicated to supporting or providing relief to small businesses are launched by the government, non-governmental organisations or the private sector. These programmes might be in form of grants, loans, or access to market opportunities. Get first-hand information about these programmes by joining entrepreneurship networks, industry-specific sector groups, accessing entrepreneurship resources on platforms like MSME Hub and keeping up-to-date with business news.

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How to Build an Online Business from Home

The internet has revolutionized the way we do business. With the rise of e-commerce, it is now easier than ever to start an online business from home. However, building a successful online business requires more than just setting up a website and waiting for customers to come. In this article, we will discuss the steps you need to take to build a profitable online business from home. Step 1: Identify your Niche The first step to building an online business from home is identifying your niche. This means finding a specific area of interest or expertise that you can focus on. It could be anything from selling handmade crafts to providing digital marketing services. To identify your niche, start by considering your passions and skills. What are you good at? What do you enjoy doing? Once you have identified your niche, research the market to see if there is demand for what you are offering. Step 2: Build your Website Once you have identified your niche, it’s time to build your website. Your website is the foundation of your online business and will be where customers come to learn about your products or services. When building your website, make sure it is user-friendly and visually appealing. Use high-quality images and clear descriptions of what you are offering. Make sure all links work properly and that there are no broken pages or errors. Step 3: Develop your Brand Your brand is how customers perceive your business. It includes everything from your logo and color scheme to the tone of voice used in marketing materials. To develop a strong brand, think about what sets you apart from competitors in your industry. What makes you unique? Use this information to create a brand that resonates with customers. Step 4: Create Content Content marketing is an essential part of any successful online business strategy. This involves creating valuable content that attracts potential customers and builds trust with existing ones. Create blog posts, videos, infographics or any other type of content that will be useful to your target audience. Share this content on social media and other relevant platforms to reach a wider audience. Step 5: Drive Traffic Once you have created valuable content, it’s time to drive traffic to your website. There are many ways to do this, including search engine optimization (SEO), social media marketing, and paid advertising. SEO involves optimizing your website for search engines so that it appears higher in search results. Social media marketing involves promoting your business on social media platforms like Facebook, Twitter and Instagram. Paid advertising involves paying for ads on platforms like Google AdWords or Facebook Ads. Step 6: Build Relationships Building relationships with customers is key to building a successful online business. This means engaging with them on social media, responding promptly to emails and providing excellent customer service. Offer incentives like discounts or freebies for repeat customers and encourage them to leave reviews or testimonials on your website or social media pages. In conclusion, building an online business from home requires hard work, dedication and patience. By following these steps, you can create a profitable online business that allows you to work from the comfort of your own home while doing something you love.

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Integrating AI Technology into Business Operations

Definition of Artificial Intelligence AI technology is a broad term that refers to any type of computer software that engages in humanlike activities – including learning, planning and problem-solving. Broadly speaking, AI can support three important business needs: automating business processes, gaining insight through data analysis, and engaging with customers and employees. How Startups are Evolving with AI Technology Startups that use AI applications for a variety of businesses and industries have seen significant growth as a result of the rise of this technology. Artificial intelligence is being used increasingly heavily by modern businesses. They are setting the standard by providing a variety of services, such as sophisticated chatbots and automated customer support. Artificial intelligence (AI) is a sophisticated technology that employs algorithms to complete tasks that were previously handled by humans. Artificial Intelligence Benefits Startups must have a solid grasp of AI technology and how it may help them grow their business before adopting it into their operations. Also, they would have to make investments in AI-focused personnel or look for alliances with AI technology suppliers. Therefore, startups can integrate AI in the following ways: As a result of integrating Artificial Intelligence (AI) in business operations, the company can make relevant decisions more swiftly, enabling it to take advantage of opportunities for competitive advantage that may otherwise be forfeited. All of this can result in a sizable reduction in operational costs for businesses utilizing AI technologies.

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