Is debt good for your business?

Lack of capital is the most critical  challenge facing many entrepreneurs of fast growing SMEs. Often the profits generated by the firms are insufficient to fund the extra working capital required for growth, thereby leaving the entrepreneurs with the option of exploring other sources of funds i.e. debt
Is debt good for your business? The answer to this question lies with you. Debts can provide great opportunities for growth if well managed, but at the same time, debts can mean failure for most businesses if not properly handled. Why? Most businesses lack a clear business plan coupled with poor management skills and high level of debts; they find themselves entangled in a web of debts that eventually take them down.
Understanding how to manage your debts effectively might mean the difference between survival and failure. For a growing business, having  a manageable level of debts can be effective way of doing business. As a successful entrepreneur; one can leverage on debt i.e. this is where a firm invests in business operations without increasing its owners' equity. This enables a firm to carry out larger projects than it could actually undertake with its limited capital. Also debts can increase income  streams of properly planned and executed business plans.
An entrepreneur can undertake debts for the following reasons:-
To  increase working capital
To expand into a new market
To make capital purchase
To improve cashflow

Before borrowing it is always expedient to inquire how much debt is too much debt. Through careful analysis of your your cashflow and specific business needs, you will find the answer. The easiest way to find out whether or not your firm has enough resources to pay its debts is by use of current ratio.
Current ratio= current assests/current liabilities.
Generally current ratio lies between 1.5 and 3 for a healthy business depending on the industry.when it is below 1, it implies either; the firm has problems meeting its short term obligations or its ability to turn inventory into cash is wanting. This enables the entrepreneur to audit his credit policy in order to mitigate the business against running into  liquidity crisis.

Helpful tips while borrowing
1. Plan effectively
Before taking any kind of debt, plan effectively. The plan should allow you to forecast your cash requirment; what you need and when you need it. This gives you time to explore various borrowing services and chance to negotiate the one with favorable terms.

2. Examine your needs
Examine your needs in terms of short-term or long-term needs. For short-term needs take short-term loans to avoid paying higher interest expense and restrictive conditions for long-term borrowings.

3. Avoid impulse borrowing
Many entrepreneurs are tempted to take out loans when interest rates are low and money is cheap. Base your borrowing decision solely on your current needs.

4. Have a budget
This is an estimate, often itemized, of expected income and expense for a given period in the future. This can act as a control tool, where you measure your total expenditure against your planned expenditure.

Customer service: The unexploited business opportunity in Kenya.

As owner of a small enterprise you focus a great deal of your time improving your business strengths and competitive advantage. In time, you establish a few areas of expertize. These are distinctive abilities or competencies that allow you to gain a foothold in your targeted market while growing your reputation as an organisation that value customer service.
The point is: entrepreneurs work very hard in order to improve their distinctive competency with which to gain unassailable competitive advantage. I strongly believe that as an entrepreneur in kenya, whether you own a small or big enterprise you have all the reasons to rejoice. Why? First, consider the poor state of customer service in Kenya from government offices, banks to matatus. To innovative entrepreneurs this can turn out to be a goldmine. Secondly, you can innovatively reposition your organisation as the premium business in term of customer service in your industry.
I believe that; successful organisations make habits of things others don't like to do, or don't find time to do. If an entrepreneur makes customer service a fundamental and integral aspect of his business, where customer service is everyone's job, you are bound to enjoy the fruits that are attributed to customer service. You don't have to look beyond your nose, to find a way of being unique. You  can subscribe to the philosophy of Donald Porter," customers do not expect you to be perfect. They do expect you to fix things when they go wrong." As entrepreneurs management of complaints is critical, and often many firms go down on this account. An organisation should cultivate a culture of customer service where complaints are viewed positively. A complaint is a double opportunity: one, a chance to learn what your customers really want;two, an opportunity to win over the loyalty of a customer. Where a customer feels his complaints are handled professionally the organisation increases the chance if getting repeat sell or even a customer may refer a potential customer. In the case of discontentment, the customer may be lost for life or even reduce the pool of potential customers.
Customer services is the final test. You can get everything else right, in terms of product, price and marketing, but unless you complete the process with incredibly  good customer service you run the risk of losing business or even going out of business. If you can provide it, you will win over an army of customers, you will be able to satisfy your customers and ultimately win over their loyalty. If you can provide it, you will be able to position your firm as an organisation where customers' needs are catered for.
Today, the customer is more informed of his rights, more demanding and less loyal to a firm. In the back drop of this knowledge: an entrepreneur who is able to emotionaly connect with his customers will sprint ahead of his competitors. With an incredibly good customer services you can make a fortune: Here is what you need to do. Leverage on emotions of your customers by being the best at caring for customers. Make your organisation the one that exudes the greatest warmth and friendliness.
As an entrepreneur your customers needs should come first and foremost. An organisation philosophy should always be " Happy Customer". This can be achieved if the traditional view where shareholders wealth maximazition interests are not the core value to the business, but rather customer needs are the core. Employees look after customers. Entrepreneur look after the employees. Employees look after the entrepreneur. The customer is the driving force of any profitable business, and therefore their welfare should be given necessary attention in order to optimize business's revenue.

By John Muchiri

Why some people are successful than others.

Why do some only dream of success while, others wake up to achieve it? One reason is the use of time, what do you spend most of your time doing? What habits take up your time?
Everyone will one day reap the harvest of their habits; those acts that have urshered many to greatness and many others to a great fall. Your habits can either be your best friend or your worst enemy. That which you habitually do will enventually become an addiction that will consume your time. Sleeping can be an addiction. Eating can be an addiction. Watching television can be an addiction.Gossip can be an addiction. If you lived for 75 years and slept consistently 8 hours a day all your life,you would have spent a total of 25 years sleeping. Similarly,if you watch television for 8 hours a day,you will have spent a total of 25 years watching television.
If people learn how to manage their time well, they stand a better chance of fulfilling their dreams. The issue of time management is a very big problem for a lot people. Time,like money, is spent and just like money,it can only be spent once. Where do you want to be in your old age? The answer to this is being decided right now by you,whether consciously or unconsciously, by how you are spending your time. The ground of greatness is time and what you plant in that ground will determine the harvest of your life - our outcomes in life are expressions of how we invested our time. The quality of a person's life is determined by how they manage their time. If you do not keep time with yourself or do things when they should be done,it will be difficult for you to keep your appointment with destiny.
The big challenge with a lot of people is not the fact that they did not have vision for the future,it is that they do not realise that every dream has demands and until you are ready to meet those demands,it will alwalys remain a dream.
The dividing line between living a successful life and living a life of struggle often lies in willingness and ability to meet the demands of the dream. The bigger the dream, the bigger the demands. The demands of the dream mean that time and resources that would have been spent on other things must be channelled to the dream.
It means risking failure and ridicule. If your dream does not consume you to a point where you can give your all and risk your all for it,then something isn't right. But when the dream becomes like the religious pearl that a man finds and sells all he has to obtain,then the dream is more likely to become a reality.
Fear always asks the question," What if it does not work?" And at that point, many are intimidated into silence. They see their ideas not working and then, they aid fear by even thinking further. They think of what people will say and how they will look in the eyes of people.
First let's get this straight,if you are overly concerned about what people say about you then you will never amount to anything great in life. Secondly, if you knew how little people talk about you,you might actually get offended that they are not talking about you enough. Thirdly, i subscribe to Steve Jobs philosophy. He did not believe in market research because he said the public did not know what they wanted. If we do not have this attitude towards what people this about us, we will be frozen in the prison of fear and intimidation.
Also, think of this, if a president were to spend time listening to all the people who talk about him, he would not have time to run the country. So friends, rejoice. If people gossip about you,then it has established one thing- that on the ladder of greatness, you are above them.
My response to the question, " what if  it doesn't work?" Has always been " i don't care!" If it works, fine, if it doesn't work, fine. If it doesns't work, i will have learned something in the process and i will be better than the one who has not tried anything yet.
As you grow, mistakes of your youth have a way of becoming the wisdom of your old age. Only those who dare to fail greatly will ever succeed greatly. Only those who are ready to lose sight of the shore will  ever discover new lands. Don't wait for the right conditions, you will wait forever. Create the conditions you desire by your leaps of faith.
Be deaf to non- constructive criticisms: they are both fickle and unreliable. My personal motto has always been that the world is my stage and the Almighty God  my audience. My job description at the end of the day is to please my audience.

By Nicholas Macharia

Social media:Unlocking new opportunities for SMEs in kenya

Social media in businesses is no
longer a choice. It has revolutionized businesses in a way that can no longer be ignored by entrepreneurs. In this age of internet evolution businesses can not afford to be left out in the social media explosion.
The 2nd quarter report of 2012/2013 by Communication Commission of Kenya (cck) shows that kenya has made tremendous steps towards internet connectivity. The report shows that:-
Kenya has witnessed an increase in the number of internet users to 17.38 million.
The number of mobile data and internet subscriptions increased to 7.7 million.
Internet penetration in kenya currently stands at 33.5% of the population.
With this in mind,entrepreneurs need to understand the incredible power social media can have on businesses and the effect it lack can inflict upon businesses.
SMEs must make social media central to their marketing plans.social media  has transformed how businesses engage with customers in the last few years.
Social media can give SMEs a presence that can be far less costly than many other options available to them.
An entrepreneur can leverage on the use of social media in advertising;where customers,potential customers and all other stakeholders can ask questions or make comments. This helps the businesses to expand the offering and also to respond promtly to their clients' needs.
One of the critical areas where businesses go down on is the management of complaints. It is vital for a business to know how to deal with complaints positively. Disabling a wall won't help,it actually antagonize the complainant.
To build good social reputation a business would rather apologize timely as it would show a high level of professionalism thereby enhancing the organization public relations.
An entrepreneur can creatively turn around the complaints and comments in ways that improve the quality of his products thereby satisfying his customers.
An entrepreneur can position his business strategically by use of:
Facebook
Twitter
A blog
An up-to-date website
The vital part of social media is that it enables a one-on-one communication between the entrepreneur and interested stakeholders.

Tips for using social media to create awareness for your business.
Make a strategy decide which appropriate site to use.e.g twitter can be used to drive traffic to other social media accounts.
Build relationships Engage and interact with customers through social media.
Deliver great content make sure the content is timely and relevant. Also content should be a good mix between products,questions,polls and images.
Be consistent Do not start then stop using social media. Consistency creates a sense of reliability.
A business should be able to understand it audience,in terms of who they are and what they want in order to achieve the best engagement.

By John Muchiri

Turning your name into a viable brand

Have you ever wondered how
certain people get appointed to certain positions?while there are a lot of factors that influence the decision to have an individual in that position,it all boils down to personal branding.
Building brands is not an easy thing and calls for a sustained effort to reap the benefits associated with it.
In the same way,people who excel in their careers spend time and energy in building their brands but not just their careers.
Branding yourself keeps you current in your field,opens doors for you,and creates a lasting impression on clients.

Questions to consider while doing personal branding
What does your name stand for?
Who are you?
What are your unique abilities?
What perception do I create in client's mind?

Personal branding is important because not everyone knows who you are,and by extention they may not know what you do.
A client will usually choose to work with someone they have worked with previously or heard of.
By branding yourself you become an asset to your business while your products becomes set of skills or services that you are offering.
By john muchiri

 Policy Statement:

The Entrepreneur Bridge is dedicated towards providing diverse advice that are tailored to suit your needs and to assist you in achieving your personal financial goals.
At Entrepreneur Bridge we understand that the decisions you make about your finances are important and need to be made with the help of someone you can trust.
The Entrepreneur Bridge offers you the opportunity through ideas to reach your financial destination once thought unattainable.
The above paraphrase is the force behind the establishment of Entrepreneur Bridge.This is a flagship project under the socioeconomic pillar in vision 2030 that is meant to address emerging trends both at local and international levels,relevant topics like unemployment especially in sub-Saharan Africa and Kenya in particular and the way forward to solving unemployment issues in this particular part of the continent.
We also seek to address the various questions addressed to us online and give subsequent and tentative solutions/answers.

Vision:
"To socially and economically empower young Kenyan entrepreneurs  for economic development"

Mission:
"To mobilize resources and offer accessible advisory services to young entrepreneurs-both existing and starts ups"

Motto:
Our motto is "Nurturing ideas".
We are meant to provide the needed and necessary ideas/knowledge to the entrepreneurs as a means to ensure that they reach their financial destination,with the ultimate purpose of making them financially empowered.