Tuesday 28 May 2019

5 Effective Tips to Achieve Financial Stability in Business


Starting a business in today’s already revolutionary digital world is not a thing to appreciate much. But, creating timely cash flow to ensure the financial stability of the business is the ultimate success that will be cherished lifelong. Be it just-started business or a huge enterprise – achieving sustainable revenue stream is something that every business owner dreams of and work tirelessly with renowned business banking services to embrace it.

When it comes to reliable business finance, everyone has their own expertise to add on how to strengthen the financial side of your business. But, the recipe of financial success that worked for them might not fit well into your business, which is why it is more crucial to picture your organizational goals before taking advice.

Where it is true that the meaning of financial stability is different for every business leader, they all strive for uninterrupted cash flow is also a universal fact that remains similar to everyone. In words of financial services provider, businesses who are not accountable for their mistakes are more likely to deal with the financial crisis than those who timely counterpart with them.

After all, financial flexibility depends on every aspect of your business – from marketing to customer service – every single part has to play a role. We’ve enlisted five smart ways that knit each business process well and help you further to embrace financial stability in one-go.

So, let’s start with the mantras of creating uninterrupted cash flow for business!

1.     Master the technique of reinvesting 





Accept it or not, we all have a common problem of celebrating the now moment without shifting our attention to the future. Where this particular human nature works well with our personal life, the effect of it on our business is quite devastating.


Whenever your business engages with profitability, it’s your responsibility to think about future investments first and employee benefits later. Instead of taking money from outside, you can effectively use the earned profit to maximize your future business growth chances.


Reinvesting is an exquisite way to avoid financial crisis and unnecessary debts. You need to learn how to set a balance between profitability for business growth and profitability for employees’ bonus & happiness. Eventually, both matters but the former drives the latter no matter what.

2.     Brainstorm your budgeting strategies






Undoubtedly, every business person starts with a structured budget and follow the same while trying to pave the path of success. But, how many of us are able to follow it precisely? Every three out of a hundred business leaders struggle with the highly increasing expenses that make it difficult for them to hold the grip of financial stability.

The overall purpose of following a budget is to lower down the bar of expenses and entertain a rise in profits. As time passes and workload increases, we compromise ourselves with tracking the expenses that ultimately leads us to zero or fewer profit margins.

Always commit yourself with detailed budgets and make it a daily ritual to track expenses. It’s okay if sometimes your budget fluctuates and expenses get a hike. But, in the long run, focus on maximizing your revenue and save money for investments.

3.     Shoot for well-known investors






No business can run well independently - there are a long array of investors that make it worth to do business in the market. But when it comes to taking money from outside, you’ve to play wise more than safe.

Timely fundraising is crucial for long-term business success. Join hands with renowned global investors who can help you get ahead of a limit, and take your idea to places. You see debts are something that you’ve to pay eventually, so why not add purpose to it.

4.     Never underestimate technology





Name it modern way or traditional trick – you need to have hands on every new thing that can help you to obtain the highest degree of financial flexibility. It is a lot to ask from every business leader to be an expert of accounting, invoicing or, legal documenting. But, if not the leader himself than who?


Acquiring technological advancements to ease complex accounting and legal part of your business is a smart way to invest time on things that matter. With advanced software, business finance stays away from glitches which means there are no hinges to financial freedom.

5.     Take charge of your silly mistakes


As much as it’s important to focus on expenses and profit margins, developing a habit to take charge of the mistakes you’ve made unknowingly is also necessary.

Avoiding excessive debts, hiring the right talent, and checking on your invoices are some of the tactics that can help you further to maintain the financial flexibility of business.

Seek advice from experience-holders!



Strengthening the financial side of your business is not rocket science, you just need to be more careful and smart while trying to achieve financial stability. Moreover, you can always take advice from financial service providers who have relevant real-life experiences to share.


Friday 1 March 2019

Investors, Impaired Assets And The Bad Purchase

How does a company or a business grow? Simple- the employees and the employers work tirelessly and continuously to come up with new ideas, products and designs to shine in the market. But then there is another approach to become bigger. By acquiring smaller companies and merging them with your own to increase your profits. Investors acquire a lot of companies and keep growing smoothly. But occasionally, you end up buying a rotten apple don’t you? Or you unknowingly end up with a bunch that soon goes bad?

Image Credit - Moneycontrol

It is not a huge mistake but one that could end up costing investors a lot. It is quite common for public companies to grow through acquisitions. This is due to the fact that it is easier to get hold of an already flourishing or at least built company than building one from the ground up. But there are good investments and there are bad investments. In time, a lot of acquired company’ valuation goes up and that means the investment was a good one.

Impaired assets and the bad purchase


But there are times when a company’s value goes down than its book value (the value at what it was bought) and this a bad investment. This is where the bought company becomes an impaired asset. This impaired asset’s market value is lesser than the value listed on the company's balance sheet. This asset also occurs when the parent company after a certain time lowers the value of those assets (bad ones). This is how you know you made a bad purchase.

Image Credit - cbc.ca

Let’s see this through with an example. But before we do that is is important to know that Generally Accepted Accounting Principles (GAAP) need companies to "test" goodwill of their assets every year for impairments. Now let’s say that Company GHI purchases Company XYZ. The book value of XYZ is $10million but due to certain calculated reasons, GHI buys it for $15million, that is $5million above its marker value. Now GHI will record these $5million of goodwill as an asset on its balance sheet.

Now a year has passed and it is time to review and look for impairments. When the gains and financial statements from XYZ are looked upon (as it is now a subsidiary of GHI), it is found that its sales fell by 40% due to certain reasons (now XYZ has a market value of $8million) Maybe the new product line by GHI did not gather popular support or the services were at fault or the competitors came up with a better line. It can be anything. If the fair value of XYZ comes to be lesser than the carrying value, as in if GHI sells XYZ today, it won’t get the the same value it bought it for but lesser, then company GHI has an impairment.

While making records, GHI would compare XYZ’s current market value of $8million plus $5 million of goodwill assets recorded earlier (total $13million) with the actual price it bought it for i.e., $15million. The difference between the two comes to be $2million, and GHI has to now reduce the goodwill on its books by this number. The goodwill entry goes down and the total assets fall accordingly.

Why does recording the new goodwill entry matter?


Well, when a company marks an asset impairment on its balance sheet, it is letting the market know that its acquired asset (here company XYZ) is now valued at a lower price than what it was originally bought at.

Impairment not to be confused with depreciation


Everything that companies buy, all their assets have a life span. When machineries are bought, they are expected to become less useful and less valuable over time. They depreciate over time. This depreciation’s value is often always calculated by the investor/ parent companies and are managed accordingly. This gradual loss of value is recorded in financial statements.

A machinery bought for $20million will e recorded at the same value in the first year but its price will keep getting smaller every year due to its depreciation. The major difference between depreciation and impairment is that depreciation is a calculated investment and risk. Whereas, an impairment is totally unexpected. A company can flourish too giving the owner company huge profits. A machine cannot magically become new.

A note for the investors and the apprentices


When such major acquisitions occur, it is important to take a note of them. When companies get impaired assets at the end of their financial year, they usually write down their assets value. That means they make its book value lesser than it used to be, the value they bought the company for.

A company can still be thriving this way when it has a lot of impaired assets hanging by its side. Because it has written down its assets and it is in general growing its parent company. If you want to understand a company’s actual financial status, read its balance sheets and financial statements, you will see profits to.

However, if you are thinking of investing, then a company having a lot of impaired assets being written down should definitely be avoided. For it just means they are making a lot of bad purchases and this will obviously affect business results in the long run.
Be wise!!

Stay away from the already rotten apple!!

Best Financial & Banking Solution Provider - Relius International Bank

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Thursday 21 February 2019

Latest News & Articles Posted By Relius International Bank

The Relius International Bank is an international finance and banking services provider that help businesses in their international banking transaction, business letter of credit, private banking, small business finance, trade finance, import/export finance guaranty etc.


We are regularly updating blogs related to international finance sector on our official website as well as high quality 3rd party websites. 


We have posted many financial and banking service blogs over global websites and here are some reference for those who loves to read articles about banking and finance sector:


Stay updated with the latest international banking & finance news.


Monday 7 January 2019

8 Ways To Build Wealth Fast | A Simple Guide to Building Wealth

Building up of wealth does not sound easy. It is almost like losing weight. But using some simple steps and methods, building wealth can be very easy.

The here mentioned guide deals with the excellent and crucial ways of building wealth easily.

Saving money

Saving money


Building wealth can be very easy and fast if you are acquainted with the best ways of save money. You can literally build a wealth you have methods of saving but if you don’t have excellent ways of saving, you will probably end up losing more than you earned. So a great part of building wealth is saving money.

Budget

 

Budget



Building wealth is almost not possible if you don’t have a budget. A budget simply helps in analyzing the amount of money coming in and the amount of money going out. And the best way of doing it is to list the things under categories like as if you bought fruits, vegetables etc, instead of listing them as fruits and vegetables separately; you must list them under “groceries”.

If we don’t have a budget, we are not tracking our spending and so we are having spending that we don’t know about. Having a budget helps in knowing in your spending. So if you are going over your budget, you can get to know this and take correct steps to rectify this.
Those who have irregular income, budget is very important as it allow them to list their expenditure and income, and calculate their saving as well as income.

Housing

 

Housing



Rent or mortgage payment is literally one of the biggest expense for almost every one of us. Most of the people spend their 50% income on rent and this restricts us from building wealth. But if you keep your 30% of income for housing rents, you are going to save well.  It is simple, the lowers you housing rent, the greater your wealth.  Downsizing your stuff can also help in this regard. You can go for buying only affordable items for your home and can help in managing the housing expenditure.

Recommended read - https://relius-international-bank.quora.com/A-Complete-Guide-To-Investment-Banking


Cars

 

Cars



Do not go for flashy cars as they are going to increase your spending.

Buying a brand new and luxurious car is always a very worst decision if you looking forward to build wealth.

And if you have taken a loan for a car that is depreciating its value every time it drives off is useless as it is not creating asset. That does not mean that you must go for driving an old second hand car. You should get the car that is affordable yet have all the qualities. You must look for the car you can pay cash for and don’t feel burden of paying the interest.

Smart Shopping

 

Smart Shopping



Smart shopping is all about doing research before buying anything as this will ensure you a good deal. Buy the things that are potent and strong, you may pay a bit more amount for them but at last you don’t have to buy product more often. This will actually help you to save more.

This might also result in delayed purchase for better saving for an expensive item. And it is literally the best way of getting over extra spending.

Trying real estate

 


Trying real estate


Investing in real estate can literally enhance your wealth. The best way of doing this is purchasing multifamily properties as they assist in producing a certain amount of cash flow. It is way better than traditional investment options. For instance, you can purchase low property and next rehab the property excellently and efficiently, and then sell it for more; you would definitely earn a certain percentage of money. The process is known as house flipping and can help in earning more for those who are ready to take this responsibility.

Investing in education 

 

Investing in education


Investing in your education means getting degrees such as MBA, PHD etc. your degree can actually yield you more money.

You can go for having a specialized designation or certification and can have many financial benefits. Not only this, but certification will give you several other advantages as well.

Drop your expenses

 

Drop your expenses


One of the biggest reasons of having your expenditure more than your incomes is having creepy and unnecessary expenses.

If your expenses are lower than your income then you are building wealth.
It’s simple, if you want to build wealth you must focus on saving as well as earning more.

The below guide is presented by Relius International bank which offers wealth planning services, asset management services, online wealth management services, and wealth planning solutions.

Wednesday 31 October 2018

All what one must know about trade finance


Trade finance is related with financing of trade transactions for both external as well as internal trade. A trade transaction requires an exporter/seller and importer/buyers. A trade transaction in financed various intermediaries such as financial institutions, banks, etc.

Trade finance exits to finance international trade basically. Good trade finance services are very helping in eliminating or reducing the risk of payment and supply involved in an international trade transaction. An international trade transaction is full of risks such as payment risks, supply risk, corporate risk, and country risk. Trade transactions require two players: an exporter and an importer.


Important facts about trade finance

  • Trade finance helps in reducing payment risk

    Earlier, neither the exporters nor the importers were sure about the payment related with the international transaction. As the time passes, exported tried to find solution to reduce their risk of non- payment, the importers too were worried about making prior payments to the exporters. But now with the evolution of trade finance, exporters as well as importers are safeguarded against the risk of payment and supply.
  • Freeing exporters and importers from stress

    Trade finance has worked as a bridge between financial gap of exporters and importers. So it reduces the pressure on exporter as well as importer by ensuring a guarantee of payment to the exporter and a guarantee of supply to the importer.
  • Many trade finance products and services

    Banks or other financial institutions provide various trade finance products or service in order to fit in the needs of various transactions and companies. Most popular ones are letter of credit and bank guarantee.
  • Factoring in trade finance

    This method is used by exporters in order to speed up their cash flow. The exporter here sells all of his open invoices at a discount to the factor (trade financier). Then the factor waits for the importer to make payment. This frees the exporter from the uncertainty of bad debts and helps him in trading by providing working capital.
  • Forfaiting

    It is a type of agreement where the exporter sells all his receivables to the forfaiter at a specified discount in exchange for cash. But all the receivables must be in guarantee of importer’s bank.

International trade financing


International trade financing is all about financing international transactions that are concerned with international trade. It assists in protecting and securing the exporters and importers. There is various international trade financing services such as:
  • Import letter of credit
  • Export letter of credit
  • Import documentary collection
  • Export documentary collection
  • EXIM bank delegated Authority lending
  • Standby/performance letter of credit
  • Discounting and confirmed acceptance
  • Trade related lines of credit
  • Letter of credit confirmation
  • Pre and post export financing
  • Borrowing base lending


Business banking


Business banking is all about a company’s financial dealings or contacts with a financial institution in order to avail business loans, credit, savings, and checking account. The two most essential services offered by business banking are: cash management and bank financing.

Export import finance


Export import finance is a sort of finance that is helpful in easy and efficient completion of an international trade transaction. It helps the exporter by providing security against the risk of non- payment and it also provides security to the importer against the receiving merchandise. Export and import finance services include bank guarantees, standby letters of credit, documentary letters of credit, bid bonds, performance bonds, etc.

Relius international bank


Relius international bank is a private bank offering best and efficient trade financing services. The bank provides scalable and flexible trade solution. Relius international bank is having expertise in sharing knowledge and advising on reducing the financial risks.