Marketing is of great importance to any sector, but each industry has its own pitfalls and problems it needs to avoid when it comes to developing its marketing campaign. If you’re already running a FinTech business, or are planning on starting one, there’s a few obstacles you need to be aware of in order to market your brand effectively.

Below Where the Trade Buys provides the following guide to help you navigate effectively through the world of marketing.

Social media avoidance

Social media can seem like a difficult arena to step into — it’s huge, the competition is astounding, and your customers can speak to you directly, in front of a massive audience. In fact, many sectors have fallen foul to ignoring and avoiding social media. According to Incisive Edge, banks were a prime example of this, citing a report from Carlisle and Gallagher Consulting Group that revealed 87% of consumers perceived social media usage by banks as being dull, irritating, or unhelpful.

But social media is where your audience is, and it’s where many spend a large amount of time. Securion Pay noted that an effective marketing campaign needs to consider Millennials, of who 84% have smartphones and 78% are on them for more than two hours every day. Embrace this and establish a strong presence on social media! Just make sure you have an effective plan for each channel — content for Twitter might not work as well on say, LinkedIn.

Also, social media is a great way to build a rapport with your customer base. Even in the event you get negative feedback, the way you deal with it will be seen just as much as the original comment. You can turn a negative into a positive: show ownership of the feedback and resolve it quickly. If you ignore it, the chances are the unhappy consumer will feel stung that you have ignored their attempt to reach out to your directly and give you a chance to respond. They will turn to other websites to tell other people of this experience. As social media and customer services expert, Jay Baers says: “A lack of response is a response. It’s a response that says, ‘We don’t care about you very much’.”

Saying too much, too soon

Do you have big news? Great! But before you rush off to tell the world, take a moment to pause. Would the news be better used slowly? Incisive Edge advises FinTech companies to consider an embargo if you’re heading to a trade show soon.

Basically, you can still create a press release about your exciting news or innovation plans, but don’t release it immediately. Place an embargo on it, so that your press sources can’t publish the news until a certain date, such as the trade show or another effective date for your company. This not only stirs up a sense of excitement, but it also lets the journalists and content writers have more time to write an engaging and detailed piece.

Ignoring offline

You may feel that as a primarily online company, your marketing strategy needs to have an online focus too. But the world of offline marketing is still going strong, and it’s a great way to build your brand and get it noticed.

For example, Delineo reported on some highly effective FinTech marketing campaigns, including offline print marketing. In the report, a robo-advisory firm was shown to have created a brilliant offline campaign that saw printed adverts placed through the underground tube network. People don’t have great signal on their phones at underground stations, so tend to notice and read printed adverts more!

As a start up, you might not have enough in your marketing budget to pull off such a wide-spread campaign but consider the use of printed media elsewhere. Are you headed to a trade show or exhibition soon? Seek out a provider of PVC banners and get your brand and goals printed up for your stand! Banners are a great tool at exhibitions and tend to be more effective than digital ads at these events, with customers recalling the brand from a banner long after the show has ended.

Ads with poor language use

You should be making use of both online and offline media in your marketing strategy, but you’ll need to make it as powerful as possible. There’s no use having a well-placed digital advert or a beautifully designed banner if the language used is dull and uninspiring.

Often overlooked, the use of language is a complex skill that can make or break your intended message. There’s a reason why so many people study language at high academic levels!

Consider the intended outcome of your marketing. What are you trying to tell the customer? At a basic level, new technology is designed to solve a problem, so tell your audience this. Words like “innovative”, “cutting-edge”, “rapid”, and “simple” can help address technology woes such as slow loading apps or complicated processes. After all, FinTech is a disruptive innovation — tell the world how it’s shaking up the banking and financial sector.

It’s important for your business to stand out for the right reasons. FinTech is a fast-growing sector, so it’s vital that you keep ahead of the game. Keep your marketing strategy strong and wide-reaching with these campaign tips.

Sources: 

https://www.callboxinc.com/b2b-marketing-and-strategy/fintech-marketing-strategy-tips/

https://blog.incisive-edge.com/blog/6-fintech-marketing-strategy-tips

https://www.delineo.com/culture/4-fantastic-fintech-marketing-campaigns/

https://securionpay.com/blog/6-marketing-trends-fintech-industry/

http://www.brightnorth.co.uk/whitepapers/Image_Quality_and_eCommerce.pdf

https://skift.com/2016/05/13/why-the-tourist-brochure-is-still-surviving-in-the-hotel-lobby/

https://www.forbes.com/sites/rogerdooley/2015/09/16/paper-vs-digital/#7de095dc33c3

https://www.pinterest.co.uk/pin/307300374549933402/

https://www.ama.org/partners/content/Pages/6-dos-and-donts-of-promotional-product-marketing.aspx

https://expandedramblings.com/index.php/tripadvisor-statistics/

https://www.prnewswire.com/news-releases/print-ads-in-newspapers-and-magazines-are-the-most-trusted-advertising-channel-when-consumers-are-making-a-purchase-decision-300424912.html

https://www.forbes.com/sites/matthunckler/2017/02/01/jay-baers-top-3-tips-for-acing-customer-service-in-the-age-of-social-media/#1cbbd1764a08

https://www.forbes.com/sites/rogerdooley/2015/09/16/paper-vs-digital/#31d49c533c34

https://blog.techdept.co.uk/2014/12/marketing-technology-words-marketers-need-to-know/

A bout of World Cup fever may have swept the nation last month but with normality restored, it is business as usual for the Premier League. Except that according to Will Tingle at Moore Stephens, the next season of the UK’s top football league is up for a little more than business as usual.

Premier League clubs are already reported to have spent close to £1bn on over 200 deals so far with a number of high profile transfers such as Riyad Mahrez moving to Manchester City and Alisson’s arrival at Liverpool setting a new transfer record for a goalkeeper. With steady investment already, we explore the reasons why it could be another record breaking summer for the Premier League.

Primarily, there is money to burn. Last year, for the first time, every Premier League club reported an operating profit, with 18 of the 20 clubs also reporting a pre-tax profit. Financial fair play appears to have ushered in a new era of sustainability. There are many reasons why clubs can expect a continuation of strong financial performance and revenue growth. This will in turn be used to fund their transfer war chests.

The domestic TV rights for the year is said to be just shy of the record-breaking £5.14bn existing deal, for three seasons from 2016-2019, with Amazon joining the Premier League market for the first time. The cost of the Amazon package to show 20 games a season from 2019 is still unknown. However, any dip in the domestic TV rights income is likely to be offset by an increase in overseas broadcast income as well as club’s own commercial deals.

The Premier League is reported to have made £3.2bn from international TV rights in the same three season period (2016-2019). Beyond this, five out of 80 contracts are said to have been confirmed to continue through to 2022: the Premier League will be optimistic they can continue growth in this area given that some of the new contracts are said to be as much as 14 times the value of current deals.

In terms of other commercial transactions, last season the Premier League introduced sleeve sponsorships, which allowed clubs to have a second brand on their kit in addition to the main shirt sponsors for the first time. Recently, Arsenal are said to have completed the biggest deal yet in this area for a reported £10million per season over three seasons with Visit Rwanda, the club’s official Tourism Partner. Notably Manchester United and Tottenham Hotspur are yet to agree sleeve sponsors which reflects the fact there is significant scope amongst several clubs to increase revenues through commercial partnerships of this nature.

What does all this money mean? As we have seen in the past, increasing revenue normally translates to growth in transfers and player wages. Although clubs are spending within their means, transfer spending has continued to rise over the years as clubs show little sign of tightening their purse strings with increased revenue making transfers more affordable for clubs and used as justification for record-breaking fees.

Premier League teams have now set a precedent for spending and there is great expectation amongst fans to do so. This has contributed to records being established at an alarming rate. Within the last 12 months, 15 of the Premier League sides for the 2018/19 season have broken their transfer record. Last summer, the total spend for the Premier League during the transfer window was beaten for a sixth consecutive year, coming in at £1.4bn. During the final day of the January transfer window alone, clubs made a record spend of £150m, marking a total spend of over £400m for the month.

There are two additional factors which will serve to add fuel to the Premier League money bonfire. Firstly, the transfer window will close earlier than normal as Premier League clubs voted in favour of closing the transfer window before the start of domestic fixtures. This means that clubs will be under increased time pressure and now have little over 2 weeks to conclude their business. This could possibly trigger a rise in the panic buys associated with the final few days of the window. A lack of time provides leverage to selling clubs in negotiations allowing them to attract higher fees for their players as buyers use money to solve problems when time becomes pressured.

The World Cup only adds to the haste given that many players, many of whom are still on holiday as part of their recovery programmes, wait until after the tournament to resolve their futures. Historically, the competition has led to irrational buying behaviour and overinflated fees as clubs have signed players off the back of a handful of good games. Kleberson, El Hadji Diouf, Guivarc'h… do the names sound familiar?

The precedent for all sides having a reason to spend is well established. Newly promoted sides and those fighting relegation are desperate to establish a foothold in the league given the rewards associated with survival. The riches of the Champions League provides sufficient justification for those competing towards the top to invest heavily.

Others are keen to scale up and compete with the so called top 6 or solely avoid a season of mid-table obscurity. With over £1.4bn spent last summer, Premier League clubs are well on track to break this record again. It promises to be a hectic finish before the transfer window closes on 9^th August.

The investing landscape has changed significantly over the last decades. Historically, the large banks have been happy enough to manage investors’ money and keep hold of the information. For those wanting to become involved, it was too tough, or too expensive. Here Finance Monthly hears from Kerim Derhalli, CEO at Invstr, on the potential for fintech to succeed in a complex evolving landscape.

Now, with an unprecedented amount of tools at our fingertips to make the process of committing cash to the stock market – or indeed other assets such as bonds – much easier, you’d expect us to be experiencing a golden age for financial independence and empowerment.

Despite this, the data tells a very different story. A recent US study by Gallup, for example, found that the combined age of adults younger than 35 with money in the stock market in 2017 and 2018 stands at 37%, down from 52% in the two years leading up to the financial crash.

While it’s true that a lingering distrust of financial institutions is impacting millennial sentiment towards stock ownership there’s a bigger story here of a more fundamental failing across the fintech industry – which is still not even scratching the surface of its potential.

Let’s look at this in simple, real world terms. If I were to stand on a street corner and hand out £5 notes to anyone passing by, I'm sure I would have several million people taking up the offer of free cash. If I stood on a digital street corner, the uptake would be even higher.

However, fintech brokers who have deployed these same techniques have apparently failed to attract huge followings. What are they missing?

Well, what many of these platforms are failing to understand is that investing is a process, not an event. Understanding what is going on in the world or at an individual company level, reading the news, following the markets, looking at charts, reading research, talking to friends, peers or strangers to get investment ideas are all part of the process.

The last part, the buying and the selling, only represents 1% of the investment process, and is by far the least exciting part of it. Companies that make the transactional and comparatively dry element the focus of their product are missing the fundamental quality of what makes fintech such an exciting proposition – and doing wannabe investors a disservice in the process.

For me, fintech is the manifestation in the financial markets of the information revolution. Whether it’s about internet or social networks, the sharing economy and now cryptocurrencies – it’s all about empowering individuals.

With investing apps, this means giving users access to data that was formerly the reserve of the large financial institutions and teaching them to interpret how real world events can impact on the stock market.

This is excellent practice for investing, whether via a mobile app or otherwise, where those who truly profit chart a path by making their own investment decisions rather than relying on passive funds that track the major exchanges.

Ultimately, it’s about putting people in a position where they can manage their own money. The disruption we’ve seen in every other consumer sector, where the empowerment of individuals has done away with intermediaries is the real opportunity. If more companies in the fintech industry can capture that space then the impact on finance will be truly transformative.

Taking a closer look at the start-up industry in Europe, card processing specialists, Paymentsense, have conducted research to find out which countries have seen the most significant rise in start-ups between 2013 -2017.

 The data has been mapped out across Europe allowing users to uncover the industries that each country specialises in and how fast those industries are growing.

Paymentsense analysed 30 European countries and ranked each one of them based on how many new businesses have been registered in that 5-year period and which business types have been the most popular in these countries.

Turkey tops the list with the most start-ups registered, followed by France and then the United Kingdom. However, data reveals that the UK is the fastest growing start-up nation in Europe and has brought more than a few successful companies to Europe, including Transferwise and Deliveroo.

Top 10 countries fuelling the European start-up industry:

Among all these countries, the UK has seen the biggest growth in the number of start-ups between 2013 and 2017 at 5.09%, followed by Romania and Portugal. What all of them have in common is a business-friendly environment that gives founders the possibility to grow and nurture their company over time.

When looking at what type of start-ups have dominated Europe in the last few years, wholesale and retail have the largest presence with 3.7 million new businesses started up.

This is surprising to see when in recent years we have seen a retail crash with companies like Woolworths and ToysRUs go bust.

The type of companies that have started up in Europe between 2013-2017

Guy Moreve, Chief Marketing Officer at Paymentsense, says: “It’s interesting to see that the UK ranks among the top five countries with the highest numbers of registered new businesses. It shows that the country offers a great setting for those interested in founding their own company.

Further afield, it’s fascinating to see how Europe has changed in recent times. A number of countries are now placing more emphasis on technology which has helped create a ‘golden era’ for tech startups.

“In order to thrive a business in your respective country, make sure you analyse the market you’re addressing – what works best and what doesn’t; It’s also worth looking at the legal and environmental conditions in order to make sure your business idea is a success”.

(Source: Paymentsense)

At some point, most companies will need to borrow money, whether it’s to fund the growth of the business, to manage cash flow or to purchase new equipment. There are plenty of business loan lenders in the market, but it’s important that you take your time to find the right product for your business. Below, Gary Hemming, expert at ABC Finance, outlines for Finance Monthly the basic considerations to make when looking into getting a business loan.

Finding the Right Type of Business Loan

The first step in securing funding is to take time to understand the different types of business loan products. The easiest way to do this is by speaking to an experienced business finance expert, ideally a whole of market, fee-free broker.

The different products available tend to have very different costs, both in terms of monthly repayments and the total charge for credit.

Calculate Your Budget Upfront – and Stick to it

Most lenders use computerised risk profiling systems to calculate the interest rate of each loan. This means that the rate charged can end up much higher than the lenders advertised ‘headline rate’.

As the expected costs can gradually creep up as the lender sees things that they feel increase their risk, setting a budget is key. A number of small steps up in the proposed monthly repayments can lead to you taking on a payment that is really stretching the limits of being affordable.

You can protect yourself against this by setting a maximum repayment upfront and sticking to it. Be prepared to walk away if the risk of taking out the loan outweighs the benefits.

Make Sure You Have the Documents Needed to Apply

Although each lender has their own requirements, there are some common documents that are almost always needed. These are your business bank statements and trading accounts.

Lenders will usually need 3 months business bank statements. These can either be scanned and certified by a suitable professional, or PDF copies downloaded via online banking.

2 years accounts are requested by most lenders, with PDF or scanned versions usually accepted. If your business does not have 2 years accounts, the lender will usually want as much evidence of trading performance as possible.

Management accounts will strengthen your application where accounts are either unavailable or if the latest accounts are more than 9 months old.

Be Clear on How Long You Need the Money for

There are a number of unsecured business finance products available and they all work in slightly different ways. It’s important that you’re clear upfront why you need the money and for how long.

If a cash injection is needed into the business and there is no large event upcoming that will be used to repay in full then a business loan is a strong option.

Where funds are being used to specifically fund a large one-off order, or contract, then there may be better options available, such a trade finance.

Equally, if you’re looking for a facility that can be used longer term and that will grow with your business, a business loan may prove too inflexible. In that case, revolving credit facilities and invoice finance may well be better suited to your needs.

An experienced broker will be able to advise you on some of the most suitable finance products for your needs within a few minutes of your initial chat.

Once You’re Completely Comfortable - Apply

Once you’re completely comfortable, and only then, apply for your business loan. If you apply with multiple lenders, you will be credit searched by each one on application.

Although it can seem like a smart move as you will get quotes from more than one lender, too many credit searches can actually reduce your credit score. To prevent this from happening, it’s important that you take a more measured approach.

You can do this by understanding the lender's criteria and interest rate bands – the rates charged depending on the risk presented to them – upfront.

Once you’ve found what seems like the most suitable, and likely cheapest option, apply with them first, while your credit score is at its strongest.

Daniel D. Morris is the Founding Partner of the Silicon Valley, Los Angeles, and Portland (Oregon) based CPA firm, Morris + D’Angelo, which focuses on servicing entrepreneurial families and their businesses. The firm utilises an integrated and holistic approach designed to help customers navigate the most complex and sensitive of matters.

Below, Daniel discusses the impact of Donald Trump’s new tax legislation, as well as the things that make Morris + D’Angelo unique when compared to other tax and business advisory firms in Silicon Valley.

What have been any recent tax policies or reforms in the US and how have they impacted your clients?

In December last year, President Donald Trump signed new tax legislation that changed the landscape of business and individual taxation. Corporate tax rates have been reduced by 40% and initiated a quasi-territorial tax system for corporations. Individual tax brackets have likewise been reduced, albeit only slightly. Individual based tax deductions have been significantly curtailed while increasing allowable standard allowances. Self-employed and associated pass-through businesses in most categories will also see reduced rates.

The most notable challenges the new legislation created are in the international arena. The new provisions created a global tax on intangibles (called GILTI) and imposes an effective 10.5% corporate level tax with the remainder excluded from income under the aforementioned quasi-territorial regime. Global structures owned and operated by individuals, families, estates, trusts, joint ventures, and pass-throughs pay a GILTI at upwards of 37% and do not receive the corporate level territorial exclusion.

This corporate versus individual disparity is creating terrific drama and challenges as advisers and taxpayers regroup their thinking as to how best to navigate global business operations while avoiding excessive taxation.

Morris + D’Angelo reacted swiftly to protect our customers’ options while providing best-of-class advisory and choices. This is an ongoing process as the legislation is so radically different in approach than the previous underlying taxation philosophy that served our country so well for nearly seventy years, that the primary concept we champion is to “hold on and prepare for more changes”.

Tell us about Morris +D’Angelo’s key priorities towards your clients? What differentiates the company as opposed to other tax and business advisory firms in Silicon Valley?

Our priorities are clearly developed around providing world-class services and options to a selected group of customers. Unlike traditional firms that charge by the hour and have a shotgun approach to customer attraction, selection, and retention, we utilise a more sniper-driven process.

Our customers share the following characteristics:

• They are closely held and family driven enterprises, meaning we do not seek publicly held companies, non-profit associations, or most regulated type enterprises.
• They are multi-jurisdictional, meaning they are or will be operating across both state and national borders and they require what we term ‘deep generalists’ that understand the complexities associated with global enterprises and who personally have developed networks of qualified advisers to assist in local matters while having a coordinated professional at the helm of global design, compliance, and outcomes.
• They frequently have family offices where we are the advisers to the family to help them achieve success in their coordinated endeavors.
• They will likely be invested in real estate as developers, landlords, commercial operators, property managers, and similar real property business activities.
• They will be engaged in technology-driven enterprises as investors, inventors, executives, and advisers.
• They will be profitable at levels that can afford our services and where there is ample cash flow to execute enhanced business operations.
• They are awesome people. They contribute to the well-being of their communities, they respect others, they promote good citizenship, and they are pleasant to spend time with. We invest in their success. Accordingly, we avoid toxic personalities.
• We live our famous trademark as we are “Not Just Another CPA Firm”.

What would you say are the challenges of providing effective tax and business advice to entrepreneurial and family-based enterprises?

Challenges, of course, are certainly situational as no two families are alike. The most common challenge is likely gathering their full attention. Entrepreneurs are doers and they are hyper-focused on achieving measurable results and rarely invest in activities that require them to reflect and ponder their futures.

Additionally, there are inherent conflicts among generations in regards to desired outcomes, where to invest the family attention, and the legacies to be fulfilled. We’re also often faced with the, unfortunately, common challenges of blended families due to divorce, or changing demographics relative to marriage and family, and the likelihood of a geographically and/or societally mixed marriage (e.g. mixed religions can create estate and inheritance issues should people of mixed faiths marry, have children, and reside in countries that base inheritance laws on religious attributes compared to for example common law or civil law countries).

On top of this, the availability of information to both the lay and professional person exponentially increases the challenge. While the internet is great for research and ideas, it fails to provide context, wisdom, or judgement. True professionalism integrates knowledge, context, and experience to blend a better result. Accordingly, there are conflicts upon perceptions of what options might be available, in the minds of customers, compared to the conclusions provided by professionals. These conflicts are best resolved by active engagement, communication, compassion, and listening. These are hallmarks of our firm. We leverage both ears before we exercise our one mouth.

What are the most tax efficient structures for US entrepreneurial and family-based enterprises?

This depends on the context of the specific case. For global enterprises, operating in a traditional cross-border CFC (controlled foreign corporation) environment, the most tax efficient structure today is likely a corporation, as it limits the global GILTI tax impact, provides for territorial tax benefits and domestic tax (on domestic earnings) of 21% or less.

For real estate type businesses, pass throughs like LLCs and Limited Partnerships are likely to provide better after tax cash flows due to reduced tax rates on real estate activities and a single layer of taxation.

As for more common business, my advice is to model out their cash flows and determine which of the available models provides the best tax-based results, ease of management and control, long-term family considerations, privacy matters, and asset protection.

I should note that trusts are generally overlooked as an operating vehicle, but they can provide many benefits of ownership along with control, asset protections, and longevity. This is something that our customers frequently consider.

How can entrepreneurs structure their business portfolio in such a way that their personal tax liability is mitigated?

Our recommendation for the families that we advise is to utilise dynastic trust concepts where the trusts are formed in excellent asset protection jurisdictions. These protector-driven trusts mitigate the risk associated with claims, allow for multi-generational transfers, and provide protection for the family’s daily operations.

What are Morris + D’Angelo’s goals moving forward?

Our goals are to continue to expand our offices to more geographies with our targets to include Dallas, Miami, Washington, DC, New York, London, and Geneva. We will continue to grow our cross-border and multinational services dedicated to helping families achieve their goals, objectives, and success. We will remain nimble, flexible, and current as it relates to technology, economics, and governance. Finally, we will continue to have fun each and every day as it makes life easier and certainly more enjoyable.

Website: https://www.cpadudes.com/

About Daniel D. Morris

In addition to his work for Morris + D’Angelo where he serves customers in over 20 countries and 25 states, Dan is also the Co-founder of The VeraSage Institute, a think tank dedicated to helping professionals improve their pricing and customer centric economics. He’s been an author/instructor with professional CPA and related associations since 1998 and has been an adjunct professor for Foothill College located in Los Altos Hills, California. Dan is the only American to hold the prestigious Post Professional Graduate Diploma in Private Wealth Advisory - a programme sponsored by the Society of Trust and Estate Professionals in the UK.

Daniel has served numerous regional and national professional associations (California CPA Society and the American Institute of Certified Public Accountants) where he’s held several leadership positions including President of the Silicon Valley/San Jose Chapter along with the state-level governance council. He is also active in FinTech, including the blockchain and associated crypto currencies and is frequently interviewed by regional and national publications.

About Morris + D’Angelo

Morris + D’Angelo’s registered trademark is Not Just Another CPA Firm – and this really is the case! The company never charges clients by time incurred, but instead, they price for purpose which ultimately means that the customers pay for the results they’ve managed to achieve.

The firm was founded in the Silicon Valley in 1994 and over the years, has helped startups and entrepreneurs that have changed the world. The team at Morris + D’Angelo listens and understands what their customers want and need and strives to deliver results in abundance. Along with the company’s physical offices, Morris + D’Angelo has a personally crafted network of affiliations throughout Europe, Asia, Australia, the Caribbean and Latin America. The firm coordinates services in a timely basis in nearly every location that deliver results that are instrumental for success.

More than two fifths (41%) of finance back-office processes could be automated in the next five years, a new study from global customer services provider Arvato CRM Solutions and management consulting firm A.T Kearney has found.

According to the new report, 41% of finance back-office processes are set to be performed by robots by 2023, with this figure rising to 53% within the next 10 years.

Implementation of Robotic Process Automation (RPA) is set to significantly boost firms’ productivity and efficiency, as bots are 20 times faster than humans with a 10% lower error rate. Subsequently, companies that adopt this technology, could potentially receive an ROI of between 300 and 1,000% over a three-year period.

It’s also predicted that the widespread roll-out of RPA solutions will result in an annual compound market growth of 50%, with the global market set to be worth $5billion by 2020.

New developments

The research also predicts that by 2023, RPA, with the help of cognitive capabilities, will be able to make automated decisions, and by 2028 robots will be able to carry out most back-office processes independently with minimal human intervention.

The new report, named ‘Robotic Process Automation: The impact of RPA on finance back-office processes’, interviewed more than 20 technology partners and players in the field of RPA, gathering together their view on the trends and developments within the sector.

Ben Warren, vice president of Digital Transformation at Arvato CRM, Global BPS, said: “RPA will revolutionize the finance back-office, as the new technology is more accurate, efficient and can work for longer hours, depending on demand.

“This can consequently help drive revenue for a business, streamlining processes and allowing employees to spend more time on higher value tasks.

“But although the benefits of automation can be great, it’s important that firms understand that to successfully utilize the technology they will need to invest.

“A full analysis of end-to-end systems and redesign of existing processes will be initially required, and companies will need to regularly review their processes as technology continues to evolve and develop over the coming decade.”

Dr. Florian Dickgreber, partner at A.T Kearney and co-author of the study, said: “Having transformed manufacturing, bots are now set to change processes in the service sector.

“We expect RPA, the automation of structured business processes, to take over more than half of all back-office processes over the next five to 10 years.”

(Source: Arvato CRM Solutions)

PayPal is an American company operating a worldwide online payment system that supports online money transfers and serves as an electronic alternative to traditional paper methods like checks and money orders. PayPal is one of the world's largest Internet payment system companies.

Established in 1998, PayPal had its initial public offering in 2002, and became a wholly owned subsidiary of eBay later that year. In 2014, eBay announced plans to spin-off PayPal into an independent company. Today, PayPal has over 200 million users worldwide. Under the kind patronage of Samuel Patterson.

With the new IFRS 15/ASC 606 compliance regulations now in place, CFOs need revenue recognition solutions that can handle complex, multi-element arrangements and fast changing product offerings. CFOs can no longer survive in fast paced business environments with a revenue recognition process where you kick off in the morning and sit around waiting for the answer. Real-time revenue recognition reporting is today’s reality. Rajiv Chopra, expert at Aptitude Software explains for Finance Monthly.

I am amazed that in 2018, and with this backdrop, so many CFOs are still not utilizing advances in accounting technology and are overly reliant on manual solutions. Over 75% of prospective clients I am speaking to are still managing revenue recognition accounting with home-grown “band-aid” systems that are reliant on manpower, excel and internal “spaghetti IT” solutions.

These manual solutions, in which the C-suite place their trust, are high risk. There is a high dependency on a select few individuals who are working under intense pressure for sustained periods of time, levels of staff turnover are high, and teams suffer from ‘Excelitus’ and burn out from the boredom of repetitive tasks. The real value of the finance team - providing management with data insights and analysis, is lost.

For example, we saw an $8bn dollar company operating in 160 countries, running 60 plus inventory spreadsheets just to track their sales. It would take 3.5 hours to open these spreadsheets – you can imagine the stress levels when they needed to close the books! Another company was doing 6 million transactions in a quarter, with 19,000 products and running 20 different revenue management systems, just to know where their revenue was. The level of financial risk was frightening with so many opportunities for misses and mistakes.

The question to CFOs and Chief Accounting Officers is why? You’re not saving money when your staff are waiting around for slow systems, correcting errors that shouldn’t be there and spending time on low value, repetitive processes. When we pose this question to CFOs and CAOs, one of the most common answers given is habit. Yet when pressed, they often admit that concerns over cost is often the real reason behind their hesitancy to adopt new technologies and automated solutions.

While the cost of revenue recognition solutions will always depend on the specific profile of an organization, a recent survey from PWC shows that the majority of companies (58% public / 84% non-public) have spent or will spend less than $500,000 complying with the new revenue recognition standards, with implementation costs going up in step with an increased contract volume and complexity (PWC 2018 accounting change survey).

There are several areas where organizations can look to build return on investment, but I believe the human cost of manual revenue recognition is significant and often undervalued by many companies. You just have to look at the high levels of staff turnover in finance teams, also consider the stress levels as they try to close the books manually and deliver substantiated reporting. In their study on the financial impact of staff turnover, Oxford Economics estimates that it costs over $39,000 just to replace a finance employee when you consider the loss of productivity, agency fees, HR and management time.

At our recent RevConnect conference, the benefits of new revenue recognition technologies were described as ‘night and day’ by David Peterson, Revenue Accounting Manager from Ivanti. He explained how, by moving from a spreadsheet-based solution to an automated revenue recognition solution, they had reduced their close from 5 to 3 days, giving his team time to do more analysis and deliver more insights to the business.

Using automation also means finance teams can leave behind all the rote tasks of data download and copy and paste and focus on data insights and analysis. New technologies also encourage innovation and attract technology-savvy talent. A recent survey from the Association of Accounting Technicians revealed that 75% of finance professionals found that using accounting technology has either made their job easier or freed up time for them to concentrate on adding value to the business.

The benefits for CFOs who have embraced new revenue recognition technologies are extensive. Crucially, they have much happier and fulfilled finance teams. They can also take back control of their environment which can result in increased output, better critical decision making, and more business opportunities.

I encourage all CFOs to stop playing catch up, be proactive and reduce the manual processing of revenue recognition. Empower your team to add value to your business, grow as contributing team members and move away from hours of manual tasks that don’t have a place in the modern CFO office. When speaking about his organization’s move to an automated revenue recognition solution, Mark Flournoy, CAO, at Intuit summarized the change perfectly: “We (finance) are actually now in service to enable the rest of the business.”

Multi-currency payments provider FairFX has revealed that since the Brexit referendum, the Euro has decreased 13% against the pound increasing financial pressure on businesses who operate cross border.

Uncertainty over future trade agreements alongside fluctuating currency rates have put the spotlight on the cost of doing business internationally and highlights the importance of monitoring foreign currency transactions.

An estimated 17% of UK based SMEs are doing business internationally, boosting their own bottom line, as well as the UK economy.  Whilst international expansion offers access to new markets, ambitions for growth need to be well planned financially, starting with the basics.

35% of SMEs state cashflow is a barrier to growth, making smart currency moves essential when it comes to international payments, and by getting the best value for every international transaction, both business ambition and cashflow can be supported.

FairFX Top tips for getting the best value when making international payments:

1. Know what you want

To get the best international payment provider for your business you need to know what you want. Consider how regularly you’ll be sending and receiving money overseas, how many currencies you’ll need to transact in and understand the costs associated with making both singular and regular transactions.

Fees and charges can vary by transaction type, day, time and speed you require the transaction to be completed in, so list out the different transaction types you may want to make and understand how the fees and charges can vary so you don’t get caught out. Understand how currency rates are set and how they compare to other providers. This can be confusing to unpick so speak to a currency expert if necessary.

2. Review your current payment package

High street banks don’t offer the best value when it comes to international business payments. Using your current banking provider to handle international as well as domestic transactions may be convenient but defaulting to them might mean you’re missing out on better rates and lower fees.

As your business grows and develops, your business banking needs will also evolve and if you’re transacting regularly small charges can add up, meaning you could be paying a high price for an unsuitable service. 

3. Select a transparent, convenient and consistent service

If you’re regularly buying from and selling abroad, fees could soon take a portion of profit from your bottom line. Pick a provider whose fees are transparent and made clear upfront so you can better manage your expenses. Look for a service where rates are consistently good – don’t be lured with teaser offers that expire and leave you trapped or unaware of post introductory fees and charges.

4. Understand the market you’re operating in

Keeping track of currency movements can be easier said than done, so sign up for a reliable rate watch service, like the one provided by FairFX which alerts you when currencies you operate in have moved in your favour. This way you can make international payments when rates give you a commercial advantage.

5. Maintain your standards

The rigorous standards you set for expenses and payments at home don’t stop when your employees pass border control, so find a solution where you are confident in who is spending what. Consider prepaid corporate cards which allow you to transact with competitive exchange rates and top-up in real-time, giving your staff the funds they need to travel for work, providing peace of mind and control over expenditure on a global scale.

6. Watch the way your employees pay

When it comes to travel, regardless of whether your staff are hosting meetings or need to cover the cost of their own accommodation and essentials, make sure you’re in charge of the exchange rate they are using for their payments.

If staff are currently paying their own expenses and then claiming back, make sure they don't fall into any exchange rate traps. Advise them to always pay in the local currency when travelling and avoid exchanging at the airport.

The FairFX corporate prepaid card allows staff to pay for expenses with the amount of money you have approved them to spend, whilst you can track and report on spending on the integrated online platform, so there is no reliance on employees using their own payment methods, choosing the exchange rate and fees charged and reclaiming the cost from your business.

7. Benefit from the best rates

Exchange rates fluctuate from day to day with the euro currently 13% lower than before the Brexit referendum announcement, a sum that on a large transfer could make the difference between profit and loss. Consider a forward contract to ensure you can benefit from peak rates by fixing international transactions up to a year in advance.

8. Ask an expert

If you are regularly making international payments it is worth finding an expert to help you with services not offered by your bank to help minimise risk and maximise the return of doing business overseas.

9. Set up a stop loss or limit order

Protect your business against market downturns with the aid of a Stop Loss, which will ensure any losses are limited if you’re aiming for a higher rate and the market takes a turn.

Also consider a Limit Order where you set up ‘target’ exchange rates and ask your currency dealer to process the transaction when the rate you’ve set is achieved to give you certainty over how payments will affect your bottom line.

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Ian Stafford-Taylor, CEO of FairFX said: “Easy access to international currency at market-leading rates whether travelling abroad or sending and receiving payments is vital for businesses breaking into and operating successfully internationally, especially in a market where rates are constantly fluctuating.

“Many small and medium sized businesses settle for high street bank accounts which can charge extortionate fees for international transactions and offer poor service. The right account and sensible planning could add up to big savings, something that SMEs can ill afford to waste in a competitive marketplace.

“As future trade agreements post Brexit become clearer businesses could find themselves with heavy workloads as they adjust the way they operate, so finding a trusted payment provider and reaping every possible benefit when it comes to currency will continue to be crucial for success.”

(Source: FairFX)

Outsourcing agreements worth £718 million were signed between January and March, according to the Arvato UK Outsourcing Index.

Outsourcing contracts worth £718 million were signed in the UK between January and March this year, with financial services and retail businesses the most active buyers, according to the Arvato UK Outsourcing Index.

The research, compiled by business outsourcing partner Arvato and industry analyst NelsonHall, found that deals worth £363 million were signed in the financial services sector, accounting for 51% of the total UK outsourcing market in Q1 and more than double the value agreed in the previous quarter (£153 million).

Retail companies agreed outsourcing deals worth £140 million in the first quarter of this year after three months of no activity in October to December 2017, according to the findings.

The rise in spending across retail and financial services contributed to an eight% increase in total contract value compared with the last quarter of 2017.

Customer service agreements continued to factor highly in UK outsourcing activity, accounting for over 20% of all spend (£152 million). This, combined with HR and payment processing contracts, saw Business Process Outsourcing (BPO) deals account for £256 million of spend – up from £179 million agreed in Q4 2017.

IT Outsourcing (ITO) contracts worth £462 million were signed in Q1, with procurement focused on cloud computing, and asset and infrastructure management.

Despite the rise in activity quarter-on-quarter, the value of outsourcing contracts signed in Q1 represents a more subdued start to the year compared with 2017 which was a record year for the industry. The research found that spend on outsourcing deals between January and March has fallen 75% year-on-year from Q1 2017.

Debra Maxwell, CEO, CRM Solutions UK & Ireland, Arvato, said: “Following a strong year for UK outsourcing in 2017, we’ve seen a more subdued market in the first quarter. With Brexit uncertainty continuing to influence buying decisions and the imminent implementation of GDPR taking up internal resources, it is to be expected that fewer deals would make it over the line in this period.

“Yet, our findings show there remains strong appetite from businesses to work with outsourcing partners to bring in external expertise for key operational areas such as customer services, and to invest in maintaining a robust IT infrastructure.”

The private sector dominated the UK outsourcing market in Q1 as businesses accounted for 90% (£645 million) of the total value of contracts signed, according to the findings.

The research found that public sector organisations agreed deals worth £73 million over the period, down from £229 million in the previous quarter. Government departments focused on securing contracts for cloud computing and application and infrastructure management.

The Arvato UK Outsourcing Index is compiled by leading BPO and IT outsourcing research and analysis firm NelsonHall, in partnership with Arvato UK. The research is based on an analysis of outsourcing contracts procured in the UK market between January and March 2018.

(Source: Arvato UK & Ireland)

Worldwide spending on blockchain is set to top $2 billion in 2018, according to the International Data Corporation.

Stacey Soohoo, research manager, customer insights and analysis at IDC, said: “The year 2018 will be a crucial stage for enterprises as they make a huge leap from proof-of-concept projects to full blockchain deployments.”

There is, clearly, a lot of time, money and effort being spent in tapping into the potential of this technology. But, how can we expect to see the benefit of all of this? How far will blockchain go in terms of changing the way we do business?

Finance

Having originally been met with some scepticism in the banking sector – probably due to its disruptive nature and the presence of scams targeted at early adopters – blockchain is increasingly being harnessed by financial institutions to change the way they do business.

Perhaps most obviously, this can help to add speed and security to the process of transferring money, something that everyone from a holiday-bound consumer to a novice investor dabbling with a forex demo account through to a FTSE100 CEO can appreciate.

Yet, as the FT notes, the process of clearing and settlement, the verification of a customer’s identity and the raising of syndicated loans can all be made more efficient with blockchain.

Traceability

Yet, to focus solely on banking and payments would be to ignore the broader scope of the benefits of blockchain.

In industries where ‘traceability’ is crucial, this provides a clear, immutable record of a financial transaction. Examples of where this is necessary include the charity sector – where organisations need to prove that donations ended up at the intended target and, perhaps most pertinently in a business context, for diamonds.

For diamond companies, being able to create and manage a record for customers and clients will enable them to be clear that their product in genuine and sourced responsibly – two things that will help reputable firms to stand out from companies engaged in practices that have threatened to tarnish the sector.

Privacy

While speed, security and a transparency are clearly important, so too is privacy, especially in sectors such as healthcare where it’s vital to protect patients’ data and, typically, there are issues with out of date security software and records systems.

While the US’ private healthcare system has already embraced blockchain, the NHS could benefit too. As Tech UK notes, tracking medical test results in real time, sharing data between medical teams in different locations for research purposes, speeding up compliance paperwork processes and handling documentation for short-term staff could all be done quickly and – crucially – with the required level of privacy. This doesn’t just benefit the NHS but also a number of science and healthcare companies that rely on the NHS for work as third parties.

In some respects, blockchain’s real power is not necessarily that it changes what can be done as a business. Rather, it enhances the way in which companies operate in the digital age, allowing to carry out the processes and practices that they have developed in recent years and allows them to be done quicker, safer and cheaper.