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Syed Ali asked:
A Customer Relationship Management (CRM) solution provides your business with a formalized means for gathering, organizing and storing customer contact information. There is a wide variety of software solutions, such as Microsoft’s Dynamics Suite, on the market serving small, mid-range and enterprise sized businesses and the solution can be tailored to meet your own business working practices.
If you are a company that has as one of its’ primary objectives the delivery of a first class customer service, then a Microsoft Dynamics CRM solution is a powerful tool to ensure that all stakeholders within your business are in possession of prospect and customer information when it matters, and especially at the point of customer contact.
Too often sales opportunities are missed because information is not readily available when it is needed within your business; for instance, a pre-sales enquiry cannot be dealt with on a timely basis because the representative who has been handling the initial relationship is not available and the prospect is about to make the decision to buy. What do you normally do in those circumstances? Advise something along the lines of “We’ll get back to you with the information you need as soon as possible.” Would it not be far better if a staff member can pick up the thread of the relationship and provide an appropriate response to your potential customer there and then?
Once a business launches a sales or marketing campaign, getting the best out of the results coming in is problematic at best and any of us that believe we have not lost sales opportunities that have fallen down the cracks in our business’ organization is either naïve, dishonest or is already operating an effective CRM solution. The obvious benefits from a Microsoft Dynamics CRM solution are to prevent loss of sales opportunities, improve customer relationships, improve sales revenues and minimize costs.
Microsoft Dynamics Software provides a customer relationship software solution that empowers management and staff with the ability to make decisions based on the most up-to-date information available on customer contact and activity. Time is better used in revenue generation activities instead of getting bogged down with finding out what is happening with a prospect or customer, instead the information is there, it is a matter of looking after the prospect or customer at that point.
Businesses benefit immensely from the savings in time and expense of valuable man hours, while effectiveness is greatly improved in dealing with prospect and customer sales and support.
Maintaining a good record of contact information with a customer allows your representatives to acquire a detailed understanding of what a customer is looking for and perhaps more importantly, what a customer may want next. This is sometimes referred to as a “holistic” approach, in that gaining an understanding of a customers needs in a wider context allows a business to place itself more directly in their shoes.
Such an understanding provides customer facing staff and departments with the ability to “second guess” what a customer wants before they know themselves or, at least, the effect is that a prospect or customer comes away from the encounter with your business with a very positive perception of how you operate.
A Microsoft Dynamics CRM solution improves business efficiency by reducing non-productive administrative time and improving your business’ understanding of a customers needs, this is turn increases revenues and enhances your business image in the eyes of your clients.
A Customer Relationship Management (CRM) solution provides your business with a formalized means for gathering, organizing and storing customer contact information. There is a wide variety of software solutions, such as Microsoft’s Dynamics Suite, on the market serving small, mid-range and enterprise sized businesses and the solution can be tailored to meet your own business working practices.
If you are a company that has as one of its’ primary objectives the delivery of a first class customer service, then a Microsoft Dynamics CRM solution is a powerful tool to ensure that all stakeholders within your business are in possession of prospect and customer information when it matters, and especially at the point of customer contact.
Too often sales opportunities are missed because information is not readily available when it is needed within your business; for instance, a pre-sales enquiry cannot be dealt with on a timely basis because the representative who has been handling the initial relationship is not available and the prospect is about to make the decision to buy. What do you normally do in those circumstances? Advise something along the lines of “We’ll get back to you with the information you need as soon as possible.” Would it not be far better if a staff member can pick up the thread of the relationship and provide an appropriate response to your potential customer there and then?
Once a business launches a sales or marketing campaign, getting the best out of the results coming in is problematic at best and any of us that believe we have not lost sales opportunities that have fallen down the cracks in our business’ organization is either naïve, dishonest or is already operating an effective CRM solution. The obvious benefits from a Microsoft Dynamics CRM solution are to prevent loss of sales opportunities, improve customer relationships, improve sales revenues and minimize costs.
Microsoft Dynamics Software provides a customer relationship software solution that empowers management and staff with the ability to make decisions based on the most up-to-date information available on customer contact and activity. Time is better used in revenue generation activities instead of getting bogged down with finding out what is happening with a prospect or customer, instead the information is there, it is a matter of looking after the prospect or customer at that point.
Businesses benefit immensely from the savings in time and expense of valuable man hours, while effectiveness is greatly improved in dealing with prospect and customer sales and support.
Maintaining a good record of contact information with a customer allows your representatives to acquire a detailed understanding of what a customer is looking for and perhaps more importantly, what a customer may want next. This is sometimes referred to as a “holistic” approach, in that gaining an understanding of a customers needs in a wider context allows a business to place itself more directly in their shoes.
Such an understanding provides customer facing staff and departments with the ability to “second guess” what a customer wants before they know themselves or, at least, the effect is that a prospect or customer comes away from the encounter with your business with a very positive perception of how you operate.
A Microsoft Dynamics CRM solution improves business efficiency by reducing non-productive administrative time and improving your business’ understanding of a customers needs, this is turn increases revenues and enhances your business image in the eyes of your clients.
John Barth asked:
The demand for custom labels in Chicago is continuing to grow with all the food processing and confectionery business centralized in the central US for easy transportation around the country. Chicago is also a hot bed for manufacturers, technology, health care, distribution and many other custom label consumers like cosmetic labels in Illinois.
Custom food labels and confectionery in Chicago have a high demand for quality, and for applicators that can affix the labels to the product without smashing the contents within like bread, snack products, and cookies. Many times these labels have custom colors for branding with a logo and an area for the food business or confectionery to print a date code or ingredients that will be variable text on each label. These can be accommodated in a thermal transfer or direct thermal label, depending on how long the product will be on the shelf in the supermarket or deli. These can also be made for scales where the variable weight and price will be printed onto the labels.
Manufacturers use custom labels for a number of reasons. The most common reason is to brand the product they are making. These are usually 4 color process labels with a UV coating that will prevent the label from fading over time. Manufactures also use custom labels to label parts and shelves in the tool cribs they use to maintain the manufacturing operation. These custom labels can also be used in the shipping process when the product is shipped into distribution. Many distributors require special barcodes to be placed on all products that are shipped to their centers. These manufacturers also use labels to mark racks in the finished goods area of the operation.
Another manufacturing application is custom UL labels. If the manufacturer is making an electronic consumer product then a UL label is required adding more custom requirements to this business sector. This also applies to the technology sector.
The technology sector in Chicago uses custom labels on circuit boards, computers for asset tracking, and special custom tamper evident labels that can show if a product has been tampered with. The circuit board labels are usually very small and some need to be produced for clean room environments. These labels require a strict and clean environment to make and seal the rolls of labels so they are air tight.
Within the health care industry in Chicago there are many sub groups and custom label applications from labeling test tubs to labeling patients wristbands to match the medications that are assigned to that particular patient. The health care industry also has their own distribution setups where custom labels are used to organize files, shelves and shipments.
The distribution industry includes transportation and consumes many labels but not all of these labels are custom. Many of these distributors use stock 4×6 labels to label shipments, but if they want to brand these with a custom logo, these custom labels can be made right here in Chicago. Rack labels, product labels, and shipping labels are very common in this business sector.
There are many other businesses in the Chicago area that need custom product labels including cosmetic labels in Illinois and all over the country. So, if you are a business in Chicago and need custom labels, you must realize the demand for custom labels is high. The capacity to meet that demand is even higher. Custom food labels, UL labels, Clean Room labels, tamper evident labels, custom 4 color labels and even cosmetic labels in Illinois and across the country is a competitive area for all of these industries.
The demand for custom labels in Chicago is continuing to grow with all the food processing and confectionery business centralized in the central US for easy transportation around the country. Chicago is also a hot bed for manufacturers, technology, health care, distribution and many other custom label consumers like cosmetic labels in Illinois.
Custom food labels and confectionery in Chicago have a high demand for quality, and for applicators that can affix the labels to the product without smashing the contents within like bread, snack products, and cookies. Many times these labels have custom colors for branding with a logo and an area for the food business or confectionery to print a date code or ingredients that will be variable text on each label. These can be accommodated in a thermal transfer or direct thermal label, depending on how long the product will be on the shelf in the supermarket or deli. These can also be made for scales where the variable weight and price will be printed onto the labels.
Manufacturers use custom labels for a number of reasons. The most common reason is to brand the product they are making. These are usually 4 color process labels with a UV coating that will prevent the label from fading over time. Manufactures also use custom labels to label parts and shelves in the tool cribs they use to maintain the manufacturing operation. These custom labels can also be used in the shipping process when the product is shipped into distribution. Many distributors require special barcodes to be placed on all products that are shipped to their centers. These manufacturers also use labels to mark racks in the finished goods area of the operation.
Another manufacturing application is custom UL labels. If the manufacturer is making an electronic consumer product then a UL label is required adding more custom requirements to this business sector. This also applies to the technology sector.
The technology sector in Chicago uses custom labels on circuit boards, computers for asset tracking, and special custom tamper evident labels that can show if a product has been tampered with. The circuit board labels are usually very small and some need to be produced for clean room environments. These labels require a strict and clean environment to make and seal the rolls of labels so they are air tight.
Within the health care industry in Chicago there are many sub groups and custom label applications from labeling test tubs to labeling patients wristbands to match the medications that are assigned to that particular patient. The health care industry also has their own distribution setups where custom labels are used to organize files, shelves and shipments.
The distribution industry includes transportation and consumes many labels but not all of these labels are custom. Many of these distributors use stock 4×6 labels to label shipments, but if they want to brand these with a custom logo, these custom labels can be made right here in Chicago. Rack labels, product labels, and shipping labels are very common in this business sector.
There are many other businesses in the Chicago area that need custom product labels including cosmetic labels in Illinois and all over the country. So, if you are a business in Chicago and need custom labels, you must realize the demand for custom labels is high. The capacity to meet that demand is even higher. Custom food labels, UL labels, Clean Room labels, tamper evident labels, custom 4 color labels and even cosmetic labels in Illinois and across the country is a competitive area for all of these industries.
Steve Bush asked:
The Working Capital Journal is one of several commercial financing resources which should be reviewed regularly by small business owners to assist in keeping up with the imposing difficulties posed by rapid changes in the business finance funding climate. As noted below, there have been some surprising actions taken by lenders as a direct result of recent financial uncertainties. The increasingly complex and confusing environment for working capital finance is likely to produce several unexpected challenges for commercial borrowers.
The working capital finance industry has primarily been operating on a regional and local basis for many years. In response to cost-cutting that has permeated many industries, there has been a consolidation that has resulted in fewer effective commercial lenders throughout the United States. Most business owners have been understandably confused about what this might mean for the future of their commercial financing efforts, especially because this has happened in a relatively short period of time.
Of course, for some time there have been ongoing complex problems for commercial borrowers to avoid when seeking commercial loans. But what has produced a new set of business finance funding problems is that we appear to be entering a period which will be characterized by even more uncertainties in the economy. With little advance notice by lenders, previous standards and rules for working capital finance and commercial financing are likely to increasingly change.
With the current realization that substantial changes are likely in the near future for commercial finance funding throughout the United States, business owners should make an extended effort to understand what is happening and what to do about it. At the forefront of these efforts should be a review of what actions commercial lenders have already taken in recent months. The Working Capital Journal is one prominent example of a free public resource that will facilitate a better understanding of the responses by business lenders to recent economic circumstances.
By publicizing actions taken by commercial lenders, this will contribute to these two goals, both of which are likely to be helpful to typical business owners: (1) To assist in eliminating or reducing questionable lending practices by highlighting controversial lending tactics. (2) To help business owners prepare for commercial finance funding changes. Sources that currently include The Working Capital Journal are actively encouraging business owners to describe and report their financing experiences so that they can be shared with a broader audience to assist in this effort. Some of the most significant commercial financing changes reported so far by commercial borrowers involve working capital loans, commercial construction financing and credit card financing. A notable situation of concern is that predatory lending practices by credit card issuers have been reported by many business owners. Because they have been excluded from obtaining any new business financing by many banks, some specific businesses such as restaurants are having an especially difficult time recently.
One of the few recent bright spots in business finance funding, as noted in The Working Capital Journal, has been the continuing ability of business owners to obtain working capital quickly by business cash advance programs. For most businesses accepting credit cards, this commercial financing approach should be actively considered. Business cash advances are literally saving the day for many small business owners because most banks appear to be doing a terrible job of providing commercial loans and other working capital finance help in the midst of recent financial and economic uncertainties. For example, as noted above, restaurants are virtually unable to currently obtain commercial finance funding from most banks. Fortunately, restaurants accepting credit cards are in a good position to obtain needed cash from credit card receivables financing and merchant cash advances.
The Working Capital Journal is one of several commercial financing resources which should be reviewed regularly by small business owners to assist in keeping up with the imposing difficulties posed by rapid changes in the business finance funding climate. As noted below, there have been some surprising actions taken by lenders as a direct result of recent financial uncertainties. The increasingly complex and confusing environment for working capital finance is likely to produce several unexpected challenges for commercial borrowers.
The working capital finance industry has primarily been operating on a regional and local basis for many years. In response to cost-cutting that has permeated many industries, there has been a consolidation that has resulted in fewer effective commercial lenders throughout the United States. Most business owners have been understandably confused about what this might mean for the future of their commercial financing efforts, especially because this has happened in a relatively short period of time.
Of course, for some time there have been ongoing complex problems for commercial borrowers to avoid when seeking commercial loans. But what has produced a new set of business finance funding problems is that we appear to be entering a period which will be characterized by even more uncertainties in the economy. With little advance notice by lenders, previous standards and rules for working capital finance and commercial financing are likely to increasingly change.
With the current realization that substantial changes are likely in the near future for commercial finance funding throughout the United States, business owners should make an extended effort to understand what is happening and what to do about it. At the forefront of these efforts should be a review of what actions commercial lenders have already taken in recent months. The Working Capital Journal is one prominent example of a free public resource that will facilitate a better understanding of the responses by business lenders to recent economic circumstances.
By publicizing actions taken by commercial lenders, this will contribute to these two goals, both of which are likely to be helpful to typical business owners: (1) To assist in eliminating or reducing questionable lending practices by highlighting controversial lending tactics. (2) To help business owners prepare for commercial finance funding changes. Sources that currently include The Working Capital Journal are actively encouraging business owners to describe and report their financing experiences so that they can be shared with a broader audience to assist in this effort. Some of the most significant commercial financing changes reported so far by commercial borrowers involve working capital loans, commercial construction financing and credit card financing. A notable situation of concern is that predatory lending practices by credit card issuers have been reported by many business owners. Because they have been excluded from obtaining any new business financing by many banks, some specific businesses such as restaurants are having an especially difficult time recently.
One of the few recent bright spots in business finance funding, as noted in The Working Capital Journal, has been the continuing ability of business owners to obtain working capital quickly by business cash advance programs. For most businesses accepting credit cards, this commercial financing approach should be actively considered. Business cash advances are literally saving the day for many small business owners because most banks appear to be doing a terrible job of providing commercial loans and other working capital finance help in the midst of recent financial and economic uncertainties. For example, as noted above, restaurants are virtually unable to currently obtain commercial finance funding from most banks. Fortunately, restaurants accepting credit cards are in a good position to obtain needed cash from credit card receivables financing and merchant cash advances.
lamara qoqiauri asked:
Finance, Credit, Investments – Economical Categories. Modern Interpretation
Scientific works in the theories of finances and credit, according to the specification of the research object, are characterized to be many-sided and many-leveled.
The definition of totality of the economical relations formed in the process of formation, distribution and usage of finances, as money sources is widely spread. For example, in “the general theory of finances” there are two definitions of finances:
1) “…Finances reflect economical relations, formation of the funds of money sources, in the process of distribution and redistribution of national receipts according to the distribution and usage”. This definition is given relatively to the conditions of Capitalism, when cash-commodity relations gain universal character;
2) “Finances represent the formation of centralized ad decentralized money sources, economical relations relatively with the distribution and usage, which serve for fulfillment of the state functions and obligations and also provision of the conditions of the widened further production”. This definition is brought without showing the environment of its action. We share partly such explanation of finances and think expedient to make some specification.
First, finances overcome the bounds of distribution and redistribution service of the national income, though it is a basic foundation of finances. Also, formation and usage of the depreciation fund which is the part of financial domain, belongs not to the distribution and redistribution of the national income (of newly formed value during a year), but to the distribution of already developed value.
This latest first appears to be a part of value of main industrial funds, later it is moved to the cost price of a ready product (that is to the value too) and after its realization, and it is set the depression fund. Its source is taken into account before hand as a depression kind in the consistence of the ready products cost price.
Second, main goal of finances is much wider then “fulfillment of the state functions and obligations and provision of conditions for the widened further production”. Finances exist on the state level and also on the manufactures and branches’ level too, and in such conditions, when the most part of the manufactures are not state.
V. M. Rodionova has a different position about this subject: “real formation of the financial resources begins on the stage of distribution, when the value is realized and concrete economical forms of the realized value are separated from the consistence of the profit”. V. M. Rodionova makes an accent of finances, as distributing relations, when D. S. Moliakov underlines industrial foundation of finances. Though both of them give quite substantiate discussion of finances, as a system of formation, distribution and usage of the funds of money sources, that comes out of the following definition of the finances: “financial cash relations, which forms in the process of distribution and redistribution of the partial value of the national wealth and total social product, is related with the subjects of the economy and formation and usage of the state cash incomes and savings in the widened further production, in the material stimulation of the workers for satisfaction of the society social and other requests”.
In the manuals of the political economy we meet with the following definitions of finances:
“Finances of the socialistic state represent economical (cash) relations, with the help of which, in the way of planned distribution of the incomes and savings the funds of money sources of the state and socialistic manufactures are formed for guaranteeing the growth of the production, rising the material and cultural level of the people and for satisfying other general society requests”.
“The system of creation and usage of necessary funds of cash resources for guarantying socialistic widened further production represent exactly the finances of the socialistic society. And the totality of economical relations arisen between state, manufactures and organizations, branches, regions and separate citizen according to the movement of cash funds make financial relations”.
As we’ve seen, definitions of finances made by financiers and political economists do not differ greatly.
In every discussed position there are:
1) expression of essence and phenomenon in the definition of finances;
2) the definition of finances, as the system of the creation and usage of funds of cash sources on the level of phenomenon.
3) Distribution of finances as social product and the value of national income, definition of the distributions planned character, main goals of the economy and economical relations, for servicing of which it is used.
If refuse the preposition “socialistic” in the definition of finances, we may say, that it still keeps actuality. We meet with such traditional definitions of finances, without an adjective “socialistic”, in the modern economical literature. We may give such an elucidation: “finances represent cash resources of production and usage, also cash relations appeared in the process of distributing values of formed economical product and national wealth for formation and further production of the cash incomes and savings of the economical subjects and state, rewarding of the workers and satisfaction of the social requests”. in this elucidation of finances like D. S. Moliakov and V. M. Rodionov’s definitions, following the traditional inheritance, we meet with the widening of the financial foundation. They concern “distribution and redistribution of the value of created economical product, also the partial distribution of the value of national wealth”. This latest is very actual, relatively to the process of privatization and the transition to privacy and is periodically used in practice in different countries, for example, Great Britain and France.
“Finances – are cash sources, financial resources, their creation and movement, distribution and redistribution, usage, also economical relations, which are conditioned by intercalculations between the economical subjects, movement of cash sources, money circulation and usage”.
“Finances are the system of economical relations, which are connected with firm creation, distribution and usage of financial resources”.We meet with absolutely innovational definitions of finances in Z. Body and R. Merton’s basis manuals. “Finance – it is the science about how the people lead spending `the deficit cash resources and incomes in the definite period of time. The financial decisions are characterized by the expenses and incomes which are 1) separated in time, and 2) as a rule, it is impossible to take them into account beforehand neither by those who get decisions nor any other person”. “Financial theory consists of numbers of the conceptions… which learns systematically the subjects of distribution of the cash resources relatively to the time factor; it also considers quantitative models, with the help of which the estimation, putting into practice and realization of the alternative variants of every financial decisions take place”.
These basic conceptions and quantitative models are used at every level of getting financial decisions, but in the latest definition of finances, we meet with the following doctrine of the financial foundation: main function of the finances is in the satisfaction of the people’s requests; the subjects of economical activities of any kind (firms, also state organs of every level) are directed towards fulfilling this basic function.
For the goals of our monograph, it is important to compare well-known definitions about finances, credit and investment, to decide how and how much it is possible to integrate the finances, investments and credit into the one total part.
Some researcher thing that credit is the consisting part of finances, if it is discussed from the position of essence and category. The other, more numerous group proves, that an economical category of credit exists parallel to the economical category of finances, by which it underlines impossibility of the credit’s existence in the consistence of finances.
N. K. Kuchukova underlined the independence of the category of credit and notes that it is only its “characteristic feature the turned movement of the value, which is not related with transmission of the loan opportunities together with the owners’ rights”.
N. D. Barkovski replies that functioning of money created an economical basis for apportioning finances and credit as an independent category and gave rise to the credit and financial relations. He noticed the Gnoseological roots of science in money and credit, as the science about finances has business with the research of such economical relations, which lean upon cash flow and credit.
Let’s discuss the most spread definitions of credit. in the modern publications credit appeared to be “luckier”, then finances. For example, we meet with the following definition of credit in the finance-economical dictionary: “credit is the loan in the form of cash and commodity with the conditions of returning, usually, by paying percent. Credit represents a form of movement of the loan capital and expresses economical relations between the creditor and borrower”.
This is the traditional definition of credit. In the earlier dictionary of the economy we read: “credit is the system of economical relations, which is formed while the transmission of cash and material means into the temporal usage, as a rule under the conditions of returning and paying percent”.
In the manual of the political economy published under reduction of V. A. Medvedev the following definition is given: “credit, as an economical category, expresses the created relations between the society, labour collective and workers during formation and usage of the loan funds, under the terms of paying present and returning, during transmission of sources for the temporal usage and accumulation”.Credit is discussed in the following way in the earlier education-methodological manuals of political economy: “credit is the system of money relations, which is created in the process of using and mobilization of temporarily free cash means of the state budget, unions, manufactures, organizations and population. Credit has an objective character. It is used for providing widened further production of the state and other needs. Credit differs from finances by the returning character, while financing of manufactures and organizations by the state is fulfilled without this condition”.
We meet with the following definition if “the course of economy”: “credit is an economical category, which represents relations, while the separate industrial organizations or persons transmit money means to each-other for temporal usage under the conditions of returning. Creation of credit is conditioned by a historical process of fulfilling the economical and money relations, the form of which is the money relation”.
Following scientists give slightly different definitions of credit:
“Credit – is a loan in the form of money or commodity, which is given to the borrower by a creditor under the conditions of returning and paying the percentage rate by the borrower”.
Credit is giving the temporally free money sources or commodity as a debt for the defined terms by the price of fixed percentage. Thus, a credit is the loan in the form of money or commodity. In the process of this loan’s movement, a definite relations are formed between a creditor (the loan is given by a juridical of physical person, who gives certain cash as a debt) and the debtor.
Combining every definition named above, we come to an idea, that credit is giving money capital of commodity as a debt, for certain terms and material provision under the price of firm percentage rate. It expresses definite economical relations between the participants of the process of capital formation. Necessity of the credit relations is conditioned, from one side, by gathering solid quantity of temporarily free money sources, and from the second side, existence of requests of them.
Though, at the same time we must distinguish two resembling concepts: loan and credit. Loan is characterized by:
· Here, the discussion may touch upon transmission of money and also things form one side (loaner) to another (borrower): a)under the owning of the borrower and, at the same time, b) under the conditions of returning same amount or same quantity and quality of the things;
· The loaning of money may bear no interest;
· Any person may take part in it.
With the difference with loan, credit, which is somehow a private occasion of the loan, represents:
· One side (loaner) gives to the second one (borrower) only money, and _ for temporal usage;
· It may not bear no interest (if the assignment doesn’t foresee something);
· In it creditor is not any person, but a credit organization (at the first place, banks).
So, a credit is the bank credit. To our mind, it is not correct to use “credit” and “loan” as the synonyms.
Banking crediting is the union of relations between bank (as a creditor) and its borrower. These relations touch upon:
a) Giving a certain amount of money to the borrower for definite purpose (though, we meet with the so-called free credits, aims and objects of crediting are not appointed in the assignment);
b) Its opportune returning;
c) Getting percentage rate from the borrower for using the sources under his/her disposal.
The essential foundation of the credit essence and its important element is existence of trust between the two sides (in Latin “credo”, from which comes the word “credit”, means “trust”).
From the position of circulation of money forms (in the abstraction, historical process of formation economical relations and social budget and banking systems expressed by them) comparing different definitions of finances and credit, the paradox conclusion appears: credit is the private occasion of finances. And truly, from the position of movement of the money forms, finances represent the process of formation and usage of the funds of cash means. Very often such movements are fulfilled without returning, but sometimes, it is possible to give loans from the budget for the investment projects of other needs. Also, when a manufacture or corporations use their cash funds and we mean the finances of industrial subject, such usage may be realized as inside the manufacture or corporation (there is no subject about returning or not returning of the usage), so gratis under conditions of returning. This latest is called commercial form because of transmitting the sources to others, but even in this occasion, it is the element of financial system of the manufacture and corporation.
From the point of cash means movement, main character of credit is the process of formation and usage of the funds of cash means under the conditions of returning and, as a rule, taking the value-percentage. If gating the credit value doesn’t take place (even in the exceptional occasions), according to the movement form, credit becomes a private occasion of finances, as from the net financial funds (consequently from the state budget) the loans which bear no interests may be used. If gating credit value takes place, by the appearance form, credit is discussed to be financial modification.
From the historical point of view, finances (especially in the sort of the state budget) and credit (beginning with usury, later commercial and banking) were developing differently for considering credit to be the part of finances. Though, from the genetic-historical point of view, previous loaners, before giving loan, needed gathering the permanent capital not returning, that is the net financial foundation. The banks analogously needed concentration of the important own capital for influxing the consumers’ means and for getting higher percentage rate under the conditions of returning. Herewith, exactly on the financial basis, in the sort of financial fund (which later partially becomes loan fund) part of the bank capital appears to be the reservation (insurance) part of the fund, which by nature is financial and not loan. So notwithstanding the essential distinctions between finances and credit form the genetic-historical point of view, credit appears to be formed from finances and represent their modification.
From the essential position of expressing economical relations of finances and credit, we meet with cardinal distinctions between these two categories. Which mostly expressed by the distinction of the movement forms notwithstanding they are returnable or not. Finances express relations in the aspects of distribution and redistribution of social product and part of the national wealth. Credit expresses distribution of the appropriate value only in the section of percentage given for loan, while according to the loan itself, a only a temporal distribution of money sources takes place.
Herewith, there is a lot of common between the finances and credit as from the essential point of view, so according to the form of movement. At the same time, there is a significant distinction between finances and credit as in the essence, so in the form too. According to this, there must be a kind of generally economical category, which will consider finances and credit as a total unity, and in the bounds of this category itself, the separation of the specific essence of the finances and credit would take place.
Funding of the cash means is common to the researched economical categories. It takes place in any separate system of finances and credit, which have been touched upon during the analyses of defining finances and credit. Word combination “funding of the cash sources (fund formation)” reflects and defines exactly essence and form of economical category of more general character, those of finances and credit categories. Though in the in economical texts and practice, it is very uncomfortable to use a termini, which consists of three words. Also, “unloading” with an information hardens greatly its influxing into the circulation even in the conditions of its strict substantiation and thoroughness.
In the discussing context we consider:
1) wide and narrow understanding of economical category of the finances;
2) discussing finances in narrow understanding under general traditional meaning;
3) discussing finances, as funding of the cash means, in wide understanding, which concerns finances – in narrow meaning and credit – in complete meaning.
Termini “funding” and its equivalent “fund formation” are used by us as the purposeful structuring of cash means, which is based on two poles – accumulation of money sources (gathering) and its usage for definite purpose in the way of financing and crediting.
We have established a new termini – “finance-investment sphere” (FIS). Analyses about interrelation of finances and credit made by us give us an opportunity of proving, that in the given termini, the word “financial” is used with the meaning of funding cash sources, its purposeful structuring. In this process we consider at the same time financial, credit and investments’ economical categories.
Let’s sum up middle results of discussing new concept – “finance-investment sphere” and discuss its investment consisting parts.
The concept “investments” was brought into the native economical science from the West. In the Soviet economical science they for a long time used in the place “investments” the termini “capital placement”, which expressed the usage of the industrial factors in the sphere of real industrial activities during realization of capital projects. From one glance, this termini in its concept is identical to the “investments”, consequently it is possible to use them as synonyms. Though the termini “investments” and “investing” have the advantage towards the termini “capital placement” from linguistic and philological points of view, because they are expressed with one word. This is not only economical and comfortable in the process of working with the termini “investment” itself, but also it gives an opportunity of termini formation. More concretely: “investment process”, “investment domain”, “finance-investment sphere” – all these termini are much more acceptable.
Changing native economical termini with foreign ones is purposeful, if it really matters (by keeping parallel usage of the native termini for the inheritance). Though we must not change native economical termini into foreign ones all together, when by ordinal traditional language easy to explain private and narrow concrete processes and elements get their own termini. The “movement” of these termini is approved in the narrow professional bounds, but their “spitting out” into the economical science may turn economical language into the tangled slang.
Let’s discuss termini – “investment” and “capital placement’s” usage in the economical literature.
Investments are placement of funds into the main and circulation capital for the purpose of getting profit. “Investments in material assets – are the placements of funds into the mobile and real estate (land, buildings, furniture and so on). Investments in financial assets are the placements of funds into the securities bank accounts and other financial instruments”.
We don’t meet with the termini “investments” in the earlier economical dictionary, but we meet the combined termini “investment policy” – the union of the industrial decisions, which guarantee main directions of the capital investments, the activities of their concentration in the determinant suburbs, on which the reaching of planned rates of development of the society production is depended, balancing and effectiveness, getting more and more production and profit of the national income for every lost Ruble”. For today, in the most actual definitions, the capital investments are bounded only by financial means, when not only financial, but also the investment of natural, material-technical and informational resources takes place. Labour resources take an actual place in the investment process. They themselves fulfill this or that investment process.
A positive side of the discussed definitions is that they connect investment policy and capital placements (investments):
- economical development according to the key directions to the concentration;
- providing high rates of economical growth;
- raising an economical effectiveness, which is expressed:
a) by growing the throw off of the production and national income for every lost Ruble;
b) by fulfilling the branch structure of the investments;
c) by improving their technological structure;
d) by optimization of their further production structure.
Compared with such definition of the investments (capital placement) the definition of investments in the dictionary attaching the “Economics” seems to be unimproved: “investments – the expenses of gathering production and industrial means and increasing material reserve”. In this definition current expenses (production expenses) are mixed with the investment (capital) expense. Also, not the investment expenses but (though the investments are followed by the appropriate expenses) exactly advancing. It differs from the expenses by that the means (means) are put by returning the advanced values, also, under the conditions of growth, to which the concept-advanced capital is corresponding. the advancing may be realized in the money, natural-material and informational forms.
Except the termini “investments”, there are two more termini related with the investment. They are shown below.
“Human capital investment” – any activity provided for rising the workers labour productivity (in the way of growing their qualification and developing their abilities); at the expenses of improving the workers’ education, health and raising the mobility of the working forces”. It is very useful to use the mentioned termini, though it needs one correction: the human capital investments do not concern only workers, but also the servants, representatives of every kind of labour.
“Investment commodity, capital goods – a capital.”
In the official manuals of political economy of the reformation time the capital investments are discussed as “expenses for creating new main funds and widening, reconstruction and renewing the active ones”. In this definition the investments (capital placements) during separation of the forms (types) of further production of the main funds are bounded only by main funds (without increases of the circulation funds and insurance reserves): a) creating new ones; b) widening; c) reconstruction; d) renewing. Also, the concept of the industrial gathering appears, at the expenses of widening of basic, circulation funds and also insurance reserves takes place”.
You’ll meet below the definitions of investments from “the course of economy”: the investments are called “placements of fund into the basic capital (basic means of production), reserves, also other economical objects and processes, which request long-termed influxing of material and cash means. “According to the division of capital into physical and money forms, the investments too must be divided into material and cash investments”.
They apportion investment commodity, to which belong industrial and nonindustrial building objects, vehicles purposed for changing or widened technical park and the furniture, increasing reserves and others.
“They call the total investments of production an investment product, which is directed towards keeping and increasing the basic capital (basic means) and reserve. Total investments consist of two parts. One of them is called the depreciation; it represents important investment resources for compensation of renewal till the level of before industrial usage, wearing out and repairing of the basic means. Second consisting part of the total investments is represented by net investments – capital investments for the purpose of increasing basic means”. Depreciation is not a compensation resource of wearing the basic funds out, but it is the purposeful financial source of such resources.
Human capital investment is “a specific kind of investments, mostly in education and health protection”.
“Real investments are the investments in the economical branches and also, they are kinds of economical activities, which provide influxing the increases of real capital, that is increasing material values of the industrial means”. We can agree with such definition with one specification that material and nonmaterial values too belong to the real capital (wealth), consequently science-researching experimental-construction results, various information, education of he workers and others. Such service as organization of the excitable games, also the service of redistribution social wealth from one private person to another (except charity).
“Financial investments represent placement of funds into the shares, obligations, promissory notes, other securities and instruments. Such investments, of course, do not give increases of the real material capital, but they help getting profit, consequently at the expenses of changing the course of the securities in the time of speculation, or distinguishing the course in different places of sell and purchasing”. We share wholly such definition, hence it follows that financial investments (if it is not followed by real investments as a result) do not increase real material wealth and real nonmaterial wealth. According to this context, the expression below is very important: “we must distinguish financial investments, which represent placement of the funds in the ways of selling and purchasing the securities for the purpose of getting profit and financial investments, which become cash and real, moved to real physical capital.”
In the “economical course” quoted before long and short-termed investments are separated. Recognizing the existence of the bounds between them, the authors ascribe short-termed investments to “one month or more” investments. If we get such conditioned criteria, that we can call the investments which overcome the terms of some months, long-termed ones, which is very doubtful and we don’t agree with it. A long-termed character of the fund placement is a significant feature of the investments (short-term doesn’t combine with the concept of investments). Principally, it would be better to point out quick compensative, middle termed compensative and long-termed compensative investments:
- less then 6 months – quick compensative;
- from 6 months up to the year and a half – middle termed compensative;
- more then the year and a half – long termed compensative.
We stopped at the definition of the investments in the capital work “economical course” for the special purpose, as, in it the author tried to discuss the concept of investments systemically and quite completely, herewith the book is published just now.
We’ll return to the discussion the definition economical category of “investments” in different publications in the following chapter. The definitions given here are quite enough for having a notion of the level of lighting up the given category in the economical literature.
What conclusions may be made according the definition of the mentioned economical category in the published works, except the made notions and specifications?
There is quite deeply, concretely and thoroughly defined the concept of “investments”, different definitions in the economical literature; but mostly in every works about the investments discussed by us until now, there is not opened the essence of investments as an economical category. In every monograph, even if it has a title investment, as an economical category, there is given only the definition, concept of investments. But, as the Academician Vasil Chantladze explains, “a concept is a discussion, which proves something about the distinguishing feature of the researched object. A concept out of much essential characteristic features represents only one, and essential in it is only – definition”.
But the categories are much wider; it is “a key, the most fundamental concept of every science”. Economical categories theoretically represent real, objectively existed productive relations. A category is the defining of occasions of existed characters, connections, relations of the objective world. Generally, any educational process is fulfilled by the categories, which give opportunities for dividing the processes and occasions semantically, for expressing the definitions of a subject and realize their specific peculiarities and economical relations of a material world.
Our goal is exactly to substantiate investments – as an economical category and also, as a financial category in the narrow understanding.
Here we apply for another manual thesis made by the academician Vasil Chantladze: “every financial relation is an economical one and every financial category is and economical one, but not every economical relation and economical category is financial relation and financial category”.
In the process of defining the investments, it is important to take in mind the sides of resources, expenses and incomes, because investment, from one side, is the result of the manufacture’s activity, and, from another one, – a part of income, which, in this case, is not used for usage.
Another occasion: it is advisable to discuss investments in two aspects: as a category of reserve and flow, which will reflect exactly the connection between “placement of funds” and “investments”.
As we’ve mentioned above, not long ago, in the well-known Soviet literature the concepts of “the placement of funds” and “investments” were accepted to be the synonyms and concerned to be investment of sources for further production of the main funds and formation of the turnover funds. We meet with such understanding of the concept of “investment” (here, they separate three types of the investment expenses: investments in the basic capital of investments, investments in the house building and investments in the reserves) in the modern economical publications and it is mostly used on the macro level during a statistical analyze of economical processes. In this concrete occasion investment is the category of reserve.
According to the aspect of flow the investments may be discussed in the process of analyzing industrial activity, when it is necessary to learn the variety of the economical relations related with the investments’ further production and formation, sources, objects and subjects, that is on the micro level.
Main distinguishing criteria of different methods of approach towards the concept of “investment” the aspect of prolonging of measuring this showing. Is it possible or not to measure the investment showing separate from the term factor (the norm of gathering, the volume of capital property, the reserves of production and so on). If it is possible, then it is the category of reserve, and if it is not, then it is measured in the section of time and belongs to the category of flow.
Thus, investment, as an economical category, is quite consuming concept. It concerns the elements defining the regularities of function and regulation of the investment domain, privately:
First, resources and values put into the industrial activity. Here, investments may be realized in the following ways:
1. mobile and real estates (buildings, constructions, furniture and other material values);
2. cash sources, purposeful bank accounts, credits, shares and other long-termed securities;
3. owners rights according to the author’s rights, licenses, Now-How, experience and other intellectual values;
4. the rights for using land and other natural resources, also other owners rights.
Notwithstanding any forms, investments are results of capital gathering. Leading investments – regularity of gathering defines its volume and dynamics and, generally, whole investment activity.
Second, the incomes ruling volume and dynamics of the resource investment. Herewith, we must underline the circumstance, that the process of getting profit, the regularity of its creation, isn’t a constant of the concept “investment”. The factors of production (also the conditions of exploitation of capital values) and selling (market conjuncture), also the process of capital gathering is the leading and important condition only for the investment formation. Though, we underline again, that the process of getting and distributing the income is a significant component of the investment activity.
The transformation of investments makes the basis for the investment activity, which concern the following circles: resources – investment (expense) – capital property – income. The practice of realization such circles of the investments transformation is exactly the investment activity (investing). The investment activity, except the investments itself, concern motivation and stimulation of the capital gathering, relations of capital gathering and ruling, also, totality of the defined level of profitability on the capital and the goals of capital growth.
According to the mentioned above, in the definitions of the investment as economical category sometimes the needed exactness and clearness is not felt, some categories of the wealth are represented tightly enough. For example, real prosperity is bounded only by material estimation. This leads us to the unvalued investment resources in the era of transformation industrial society into the investment one; also to the recognition of yet uninvolved valuable scientific researches in the production, securities turned into speculation objects, and unreal property in the consistence of one and the same parts; to there equalization. On the basis of the made analyses, we can cite a wide definition of the investments together with the leading categories.
Investment resources – are values, invested into this or that project in this or that kind for the purpose of getting profit beginning with material ones, finished with cash.
Kinds of the prosperity are equal to the kinds of the investment resources and is divided into real and cash, consequently into financial resources.
Real investment resources concern all kinds:
- natural resources;
- labour resources;
- material resources, the usage of which is possible in the economical development (buildings, constructions, vehicles and furniture, transport and communication means and so on;
- investment resources (in the widest understanding, that is from scientific-research and experimental-construction works, till the education potential of the society and till all kinds of gathering useful information, written about every possible, that is typing and electronic bearer).
Cash, consequently financial resources concern every cash means for usage in this way in definite conditions or directed in the sort of investments.
Cash means (resources) turn into the financial resources in the case of structuring of funds of purposeful destination foreseen for investments of this or that kind.
After defining investment resources we can make wide definition of the investments as economical category.
Investments – are the placements of real, financial and intellectual resources into the projects, the fulfillment of which leads us to getting the increases from real wealth, in the material and informational forms. It is followed by a cash (financial) prosperity or its increases (at the expenses of the distribution of the cash means).
As an economical category, investments express economical relations, which are created in the ways of using and formation of the investment resources between the participants of the investment process for the purpose of improving and widening of the enterprise.
Finance, Credit, Investments – Economical Categories. Modern Interpretation
Scientific works in the theories of finances and credit, according to the specification of the research object, are characterized to be many-sided and many-leveled.
The definition of totality of the economical relations formed in the process of formation, distribution and usage of finances, as money sources is widely spread. For example, in “the general theory of finances” there are two definitions of finances:
1) “…Finances reflect economical relations, formation of the funds of money sources, in the process of distribution and redistribution of national receipts according to the distribution and usage”. This definition is given relatively to the conditions of Capitalism, when cash-commodity relations gain universal character;
2) “Finances represent the formation of centralized ad decentralized money sources, economical relations relatively with the distribution and usage, which serve for fulfillment of the state functions and obligations and also provision of the conditions of the widened further production”. This definition is brought without showing the environment of its action. We share partly such explanation of finances and think expedient to make some specification.
First, finances overcome the bounds of distribution and redistribution service of the national income, though it is a basic foundation of finances. Also, formation and usage of the depreciation fund which is the part of financial domain, belongs not to the distribution and redistribution of the national income (of newly formed value during a year), but to the distribution of already developed value.
This latest first appears to be a part of value of main industrial funds, later it is moved to the cost price of a ready product (that is to the value too) and after its realization, and it is set the depression fund. Its source is taken into account before hand as a depression kind in the consistence of the ready products cost price.
Second, main goal of finances is much wider then “fulfillment of the state functions and obligations and provision of conditions for the widened further production”. Finances exist on the state level and also on the manufactures and branches’ level too, and in such conditions, when the most part of the manufactures are not state.
V. M. Rodionova has a different position about this subject: “real formation of the financial resources begins on the stage of distribution, when the value is realized and concrete economical forms of the realized value are separated from the consistence of the profit”. V. M. Rodionova makes an accent of finances, as distributing relations, when D. S. Moliakov underlines industrial foundation of finances. Though both of them give quite substantiate discussion of finances, as a system of formation, distribution and usage of the funds of money sources, that comes out of the following definition of the finances: “financial cash relations, which forms in the process of distribution and redistribution of the partial value of the national wealth and total social product, is related with the subjects of the economy and formation and usage of the state cash incomes and savings in the widened further production, in the material stimulation of the workers for satisfaction of the society social and other requests”.
In the manuals of the political economy we meet with the following definitions of finances:
“Finances of the socialistic state represent economical (cash) relations, with the help of which, in the way of planned distribution of the incomes and savings the funds of money sources of the state and socialistic manufactures are formed for guaranteeing the growth of the production, rising the material and cultural level of the people and for satisfying other general society requests”.
“The system of creation and usage of necessary funds of cash resources for guarantying socialistic widened further production represent exactly the finances of the socialistic society. And the totality of economical relations arisen between state, manufactures and organizations, branches, regions and separate citizen according to the movement of cash funds make financial relations”.
As we’ve seen, definitions of finances made by financiers and political economists do not differ greatly.
In every discussed position there are:
1) expression of essence and phenomenon in the definition of finances;
2) the definition of finances, as the system of the creation and usage of funds of cash sources on the level of phenomenon.
3) Distribution of finances as social product and the value of national income, definition of the distributions planned character, main goals of the economy and economical relations, for servicing of which it is used.
If refuse the preposition “socialistic” in the definition of finances, we may say, that it still keeps actuality. We meet with such traditional definitions of finances, without an adjective “socialistic”, in the modern economical literature. We may give such an elucidation: “finances represent cash resources of production and usage, also cash relations appeared in the process of distributing values of formed economical product and national wealth for formation and further production of the cash incomes and savings of the economical subjects and state, rewarding of the workers and satisfaction of the social requests”. in this elucidation of finances like D. S. Moliakov and V. M. Rodionov’s definitions, following the traditional inheritance, we meet with the widening of the financial foundation. They concern “distribution and redistribution of the value of created economical product, also the partial distribution of the value of national wealth”. This latest is very actual, relatively to the process of privatization and the transition to privacy and is periodically used in practice in different countries, for example, Great Britain and France.
“Finances – are cash sources, financial resources, their creation and movement, distribution and redistribution, usage, also economical relations, which are conditioned by intercalculations between the economical subjects, movement of cash sources, money circulation and usage”.
“Finances are the system of economical relations, which are connected with firm creation, distribution and usage of financial resources”.We meet with absolutely innovational definitions of finances in Z. Body and R. Merton’s basis manuals. “Finance – it is the science about how the people lead spending `the deficit cash resources and incomes in the definite period of time. The financial decisions are characterized by the expenses and incomes which are 1) separated in time, and 2) as a rule, it is impossible to take them into account beforehand neither by those who get decisions nor any other person”. “Financial theory consists of numbers of the conceptions… which learns systematically the subjects of distribution of the cash resources relatively to the time factor; it also considers quantitative models, with the help of which the estimation, putting into practice and realization of the alternative variants of every financial decisions take place”.
These basic conceptions and quantitative models are used at every level of getting financial decisions, but in the latest definition of finances, we meet with the following doctrine of the financial foundation: main function of the finances is in the satisfaction of the people’s requests; the subjects of economical activities of any kind (firms, also state organs of every level) are directed towards fulfilling this basic function.
For the goals of our monograph, it is important to compare well-known definitions about finances, credit and investment, to decide how and how much it is possible to integrate the finances, investments and credit into the one total part.
Some researcher thing that credit is the consisting part of finances, if it is discussed from the position of essence and category. The other, more numerous group proves, that an economical category of credit exists parallel to the economical category of finances, by which it underlines impossibility of the credit’s existence in the consistence of finances.
N. K. Kuchukova underlined the independence of the category of credit and notes that it is only its “characteristic feature the turned movement of the value, which is not related with transmission of the loan opportunities together with the owners’ rights”.
N. D. Barkovski replies that functioning of money created an economical basis for apportioning finances and credit as an independent category and gave rise to the credit and financial relations. He noticed the Gnoseological roots of science in money and credit, as the science about finances has business with the research of such economical relations, which lean upon cash flow and credit.
Let’s discuss the most spread definitions of credit. in the modern publications credit appeared to be “luckier”, then finances. For example, we meet with the following definition of credit in the finance-economical dictionary: “credit is the loan in the form of cash and commodity with the conditions of returning, usually, by paying percent. Credit represents a form of movement of the loan capital and expresses economical relations between the creditor and borrower”.
This is the traditional definition of credit. In the earlier dictionary of the economy we read: “credit is the system of economical relations, which is formed while the transmission of cash and material means into the temporal usage, as a rule under the conditions of returning and paying percent”.
In the manual of the political economy published under reduction of V. A. Medvedev the following definition is given: “credit, as an economical category, expresses the created relations between the society, labour collective and workers during formation and usage of the loan funds, under the terms of paying present and returning, during transmission of sources for the temporal usage and accumulation”.Credit is discussed in the following way in the earlier education-methodological manuals of political economy: “credit is the system of money relations, which is created in the process of using and mobilization of temporarily free cash means of the state budget, unions, manufactures, organizations and population. Credit has an objective character. It is used for providing widened further production of the state and other needs. Credit differs from finances by the returning character, while financing of manufactures and organizations by the state is fulfilled without this condition”.
We meet with the following definition if “the course of economy”: “credit is an economical category, which represents relations, while the separate industrial organizations or persons transmit money means to each-other for temporal usage under the conditions of returning. Creation of credit is conditioned by a historical process of fulfilling the economical and money relations, the form of which is the money relation”.
Following scientists give slightly different definitions of credit:
“Credit – is a loan in the form of money or commodity, which is given to the borrower by a creditor under the conditions of returning and paying the percentage rate by the borrower”.
Credit is giving the temporally free money sources or commodity as a debt for the defined terms by the price of fixed percentage. Thus, a credit is the loan in the form of money or commodity. In the process of this loan’s movement, a definite relations are formed between a creditor (the loan is given by a juridical of physical person, who gives certain cash as a debt) and the debtor.
Combining every definition named above, we come to an idea, that credit is giving money capital of commodity as a debt, for certain terms and material provision under the price of firm percentage rate. It expresses definite economical relations between the participants of the process of capital formation. Necessity of the credit relations is conditioned, from one side, by gathering solid quantity of temporarily free money sources, and from the second side, existence of requests of them.
Though, at the same time we must distinguish two resembling concepts: loan and credit. Loan is characterized by:
· Here, the discussion may touch upon transmission of money and also things form one side (loaner) to another (borrower): a)under the owning of the borrower and, at the same time, b) under the conditions of returning same amount or same quantity and quality of the things;
· The loaning of money may bear no interest;
· Any person may take part in it.
With the difference with loan, credit, which is somehow a private occasion of the loan, represents:
· One side (loaner) gives to the second one (borrower) only money, and _ for temporal usage;
· It may not bear no interest (if the assignment doesn’t foresee something);
· In it creditor is not any person, but a credit organization (at the first place, banks).
So, a credit is the bank credit. To our mind, it is not correct to use “credit” and “loan” as the synonyms.
Banking crediting is the union of relations between bank (as a creditor) and its borrower. These relations touch upon:
a) Giving a certain amount of money to the borrower for definite purpose (though, we meet with the so-called free credits, aims and objects of crediting are not appointed in the assignment);
b) Its opportune returning;
c) Getting percentage rate from the borrower for using the sources under his/her disposal.
The essential foundation of the credit essence and its important element is existence of trust between the two sides (in Latin “credo”, from which comes the word “credit”, means “trust”).
From the position of circulation of money forms (in the abstraction, historical process of formation economical relations and social budget and banking systems expressed by them) comparing different definitions of finances and credit, the paradox conclusion appears: credit is the private occasion of finances. And truly, from the position of movement of the money forms, finances represent the process of formation and usage of the funds of cash means. Very often such movements are fulfilled without returning, but sometimes, it is possible to give loans from the budget for the investment projects of other needs. Also, when a manufacture or corporations use their cash funds and we mean the finances of industrial subject, such usage may be realized as inside the manufacture or corporation (there is no subject about returning or not returning of the usage), so gratis under conditions of returning. This latest is called commercial form because of transmitting the sources to others, but even in this occasion, it is the element of financial system of the manufacture and corporation.
From the point of cash means movement, main character of credit is the process of formation and usage of the funds of cash means under the conditions of returning and, as a rule, taking the value-percentage. If gating the credit value doesn’t take place (even in the exceptional occasions), according to the movement form, credit becomes a private occasion of finances, as from the net financial funds (consequently from the state budget) the loans which bear no interests may be used. If gating credit value takes place, by the appearance form, credit is discussed to be financial modification.
From the historical point of view, finances (especially in the sort of the state budget) and credit (beginning with usury, later commercial and banking) were developing differently for considering credit to be the part of finances. Though, from the genetic-historical point of view, previous loaners, before giving loan, needed gathering the permanent capital not returning, that is the net financial foundation. The banks analogously needed concentration of the important own capital for influxing the consumers’ means and for getting higher percentage rate under the conditions of returning. Herewith, exactly on the financial basis, in the sort of financial fund (which later partially becomes loan fund) part of the bank capital appears to be the reservation (insurance) part of the fund, which by nature is financial and not loan. So notwithstanding the essential distinctions between finances and credit form the genetic-historical point of view, credit appears to be formed from finances and represent their modification.
From the essential position of expressing economical relations of finances and credit, we meet with cardinal distinctions between these two categories. Which mostly expressed by the distinction of the movement forms notwithstanding they are returnable or not. Finances express relations in the aspects of distribution and redistribution of social product and part of the national wealth. Credit expresses distribution of the appropriate value only in the section of percentage given for loan, while according to the loan itself, a only a temporal distribution of money sources takes place.
Herewith, there is a lot of common between the finances and credit as from the essential point of view, so according to the form of movement. At the same time, there is a significant distinction between finances and credit as in the essence, so in the form too. According to this, there must be a kind of generally economical category, which will consider finances and credit as a total unity, and in the bounds of this category itself, the separation of the specific essence of the finances and credit would take place.
Funding of the cash means is common to the researched economical categories. It takes place in any separate system of finances and credit, which have been touched upon during the analyses of defining finances and credit. Word combination “funding of the cash sources (fund formation)” reflects and defines exactly essence and form of economical category of more general character, those of finances and credit categories. Though in the in economical texts and practice, it is very uncomfortable to use a termini, which consists of three words. Also, “unloading” with an information hardens greatly its influxing into the circulation even in the conditions of its strict substantiation and thoroughness.
In the discussing context we consider:
1) wide and narrow understanding of economical category of the finances;
2) discussing finances in narrow understanding under general traditional meaning;
3) discussing finances, as funding of the cash means, in wide understanding, which concerns finances – in narrow meaning and credit – in complete meaning.
Termini “funding” and its equivalent “fund formation” are used by us as the purposeful structuring of cash means, which is based on two poles – accumulation of money sources (gathering) and its usage for definite purpose in the way of financing and crediting.
We have established a new termini – “finance-investment sphere” (FIS). Analyses about interrelation of finances and credit made by us give us an opportunity of proving, that in the given termini, the word “financial” is used with the meaning of funding cash sources, its purposeful structuring. In this process we consider at the same time financial, credit and investments’ economical categories.
Let’s sum up middle results of discussing new concept – “finance-investment sphere” and discuss its investment consisting parts.
The concept “investments” was brought into the native economical science from the West. In the Soviet economical science they for a long time used in the place “investments” the termini “capital placement”, which expressed the usage of the industrial factors in the sphere of real industrial activities during realization of capital projects. From one glance, this termini in its concept is identical to the “investments”, consequently it is possible to use them as synonyms. Though the termini “investments” and “investing” have the advantage towards the termini “capital placement” from linguistic and philological points of view, because they are expressed with one word. This is not only economical and comfortable in the process of working with the termini “investment” itself, but also it gives an opportunity of termini formation. More concretely: “investment process”, “investment domain”, “finance-investment sphere” – all these termini are much more acceptable.
Changing native economical termini with foreign ones is purposeful, if it really matters (by keeping parallel usage of the native termini for the inheritance). Though we must not change native economical termini into foreign ones all together, when by ordinal traditional language easy to explain private and narrow concrete processes and elements get their own termini. The “movement” of these termini is approved in the narrow professional bounds, but their “spitting out” into the economical science may turn economical language into the tangled slang.
Let’s discuss termini – “investment” and “capital placement’s” usage in the economical literature.
Investments are placement of funds into the main and circulation capital for the purpose of getting profit. “Investments in material assets – are the placements of funds into the mobile and real estate (land, buildings, furniture and so on). Investments in financial assets are the placements of funds into the securities bank accounts and other financial instruments”.
We don’t meet with the termini “investments” in the earlier economical dictionary, but we meet the combined termini “investment policy” – the union of the industrial decisions, which guarantee main directions of the capital investments, the activities of their concentration in the determinant suburbs, on which the reaching of planned rates of development of the society production is depended, balancing and effectiveness, getting more and more production and profit of the national income for every lost Ruble”. For today, in the most actual definitions, the capital investments are bounded only by financial means, when not only financial, but also the investment of natural, material-technical and informational resources takes place. Labour resources take an actual place in the investment process. They themselves fulfill this or that investment process.
A positive side of the discussed definitions is that they connect investment policy and capital placements (investments):
- economical development according to the key directions to the concentration;
- providing high rates of economical growth;
- raising an economical effectiveness, which is expressed:
a) by growing the throw off of the production and national income for every lost Ruble;
b) by fulfilling the branch structure of the investments;
c) by improving their technological structure;
d) by optimization of their further production structure.
Compared with such definition of the investments (capital placement) the definition of investments in the dictionary attaching the “Economics” seems to be unimproved: “investments – the expenses of gathering production and industrial means and increasing material reserve”. In this definition current expenses (production expenses) are mixed with the investment (capital) expense. Also, not the investment expenses but (though the investments are followed by the appropriate expenses) exactly advancing. It differs from the expenses by that the means (means) are put by returning the advanced values, also, under the conditions of growth, to which the concept-advanced capital is corresponding. the advancing may be realized in the money, natural-material and informational forms.
Except the termini “investments”, there are two more termini related with the investment. They are shown below.
“Human capital investment” – any activity provided for rising the workers labour productivity (in the way of growing their qualification and developing their abilities); at the expenses of improving the workers’ education, health and raising the mobility of the working forces”. It is very useful to use the mentioned termini, though it needs one correction: the human capital investments do not concern only workers, but also the servants, representatives of every kind of labour.
“Investment commodity, capital goods – a capital.”
In the official manuals of political economy of the reformation time the capital investments are discussed as “expenses for creating new main funds and widening, reconstruction and renewing the active ones”. In this definition the investments (capital placements) during separation of the forms (types) of further production of the main funds are bounded only by main funds (without increases of the circulation funds and insurance reserves): a) creating new ones; b) widening; c) reconstruction; d) renewing. Also, the concept of the industrial gathering appears, at the expenses of widening of basic, circulation funds and also insurance reserves takes place”.
You’ll meet below the definitions of investments from “the course of economy”: the investments are called “placements of fund into the basic capital (basic means of production), reserves, also other economical objects and processes, which request long-termed influxing of material and cash means. “According to the division of capital into physical and money forms, the investments too must be divided into material and cash investments”.
They apportion investment commodity, to which belong industrial and nonindustrial building objects, vehicles purposed for changing or widened technical park and the furniture, increasing reserves and others.
“They call the total investments of production an investment product, which is directed towards keeping and increasing the basic capital (basic means) and reserve. Total investments consist of two parts. One of them is called the depreciation; it represents important investment resources for compensation of renewal till the level of before industrial usage, wearing out and repairing of the basic means. Second consisting part of the total investments is represented by net investments – capital investments for the purpose of increasing basic means”. Depreciation is not a compensation resource of wearing the basic funds out, but it is the purposeful financial source of such resources.
Human capital investment is “a specific kind of investments, mostly in education and health protection”.
“Real investments are the investments in the economical branches and also, they are kinds of economical activities, which provide influxing the increases of real capital, that is increasing material values of the industrial means”. We can agree with such definition with one specification that material and nonmaterial values too belong to the real capital (wealth), consequently science-researching experimental-construction results, various information, education of he workers and others. Such service as organization of the excitable games, also the service of redistribution social wealth from one private person to another (except charity).
“Financial investments represent placement of funds into the shares, obligations, promissory notes, other securities and instruments. Such investments, of course, do not give increases of the real material capital, but they help getting profit, consequently at the expenses of changing the course of the securities in the time of speculation, or distinguishing the course in different places of sell and purchasing”. We share wholly such definition, hence it follows that financial investments (if it is not followed by real investments as a result) do not increase real material wealth and real nonmaterial wealth. According to this context, the expression below is very important: “we must distinguish financial investments, which represent placement of the funds in the ways of selling and purchasing the securities for the purpose of getting profit and financial investments, which become cash and real, moved to real physical capital.”
In the “economical course” quoted before long and short-termed investments are separated. Recognizing the existence of the bounds between them, the authors ascribe short-termed investments to “one month or more” investments. If we get such conditioned criteria, that we can call the investments which overcome the terms of some months, long-termed ones, which is very doubtful and we don’t agree with it. A long-termed character of the fund placement is a significant feature of the investments (short-term doesn’t combine with the concept of investments). Principally, it would be better to point out quick compensative, middle termed compensative and long-termed compensative investments:
- less then 6 months – quick compensative;
- from 6 months up to the year and a half – middle termed compensative;
- more then the year and a half – long termed compensative.
We stopped at the definition of the investments in the capital work “economical course” for the special purpose, as, in it the author tried to discuss the concept of investments systemically and quite completely, herewith the book is published just now.
We’ll return to the discussion the definition economical category of “investments” in different publications in the following chapter. The definitions given here are quite enough for having a notion of the level of lighting up the given category in the economical literature.
What conclusions may be made according the definition of the mentioned economical category in the published works, except the made notions and specifications?
There is quite deeply, concretely and thoroughly defined the concept of “investments”, different definitions in the economical literature; but mostly in every works about the investments discussed by us until now, there is not opened the essence of investments as an economical category. In every monograph, even if it has a title investment, as an economical category, there is given only the definition, concept of investments. But, as the Academician Vasil Chantladze explains, “a concept is a discussion, which proves something about the distinguishing feature of the researched object. A concept out of much essential characteristic features represents only one, and essential in it is only – definition”.
But the categories are much wider; it is “a key, the most fundamental concept of every science”. Economical categories theoretically represent real, objectively existed productive relations. A category is the defining of occasions of existed characters, connections, relations of the objective world. Generally, any educational process is fulfilled by the categories, which give opportunities for dividing the processes and occasions semantically, for expressing the definitions of a subject and realize their specific peculiarities and economical relations of a material world.
Our goal is exactly to substantiate investments – as an economical category and also, as a financial category in the narrow understanding.
Here we apply for another manual thesis made by the academician Vasil Chantladze: “every financial relation is an economical one and every financial category is and economical one, but not every economical relation and economical category is financial relation and financial category”.
In the process of defining the investments, it is important to take in mind the sides of resources, expenses and incomes, because investment, from one side, is the result of the manufacture’s activity, and, from another one, – a part of income, which, in this case, is not used for usage.
Another occasion: it is advisable to discuss investments in two aspects: as a category of reserve and flow, which will reflect exactly the connection between “placement of funds” and “investments”.
As we’ve mentioned above, not long ago, in the well-known Soviet literature the concepts of “the placement of funds” and “investments” were accepted to be the synonyms and concerned to be investment of sources for further production of the main funds and formation of the turnover funds. We meet with such understanding of the concept of “investment” (here, they separate three types of the investment expenses: investments in the basic capital of investments, investments in the house building and investments in the reserves) in the modern economical publications and it is mostly used on the macro level during a statistical analyze of economical processes. In this concrete occasion investment is the category of reserve.
According to the aspect of flow the investments may be discussed in the process of analyzing industrial activity, when it is necessary to learn the variety of the economical relations related with the investments’ further production and formation, sources, objects and subjects, that is on the micro level.
Main distinguishing criteria of different methods of approach towards the concept of “investment” the aspect of prolonging of measuring this showing. Is it possible or not to measure the investment showing separate from the term factor (the norm of gathering, the volume of capital property, the reserves of production and so on). If it is possible, then it is the category of reserve, and if it is not, then it is measured in the section of time and belongs to the category of flow.
Thus, investment, as an economical category, is quite consuming concept. It concerns the elements defining the regularities of function and regulation of the investment domain, privately:
First, resources and values put into the industrial activity. Here, investments may be realized in the following ways:
1. mobile and real estates (buildings, constructions, furniture and other material values);
2. cash sources, purposeful bank accounts, credits, shares and other long-termed securities;
3. owners rights according to the author’s rights, licenses, Now-How, experience and other intellectual values;
4. the rights for using land and other natural resources, also other owners rights.
Notwithstanding any forms, investments are results of capital gathering. Leading investments – regularity of gathering defines its volume and dynamics and, generally, whole investment activity.
Second, the incomes ruling volume and dynamics of the resource investment. Herewith, we must underline the circumstance, that the process of getting profit, the regularity of its creation, isn’t a constant of the concept “investment”. The factors of production (also the conditions of exploitation of capital values) and selling (market conjuncture), also the process of capital gathering is the leading and important condition only for the investment formation. Though, we underline again, that the process of getting and distributing the income is a significant component of the investment activity.
The transformation of investments makes the basis for the investment activity, which concern the following circles: resources – investment (expense) – capital property – income. The practice of realization such circles of the investments transformation is exactly the investment activity (investing). The investment activity, except the investments itself, concern motivation and stimulation of the capital gathering, relations of capital gathering and ruling, also, totality of the defined level of profitability on the capital and the goals of capital growth.
According to the mentioned above, in the definitions of the investment as economical category sometimes the needed exactness and clearness is not felt, some categories of the wealth are represented tightly enough. For example, real prosperity is bounded only by material estimation. This leads us to the unvalued investment resources in the era of transformation industrial society into the investment one; also to the recognition of yet uninvolved valuable scientific researches in the production, securities turned into speculation objects, and unreal property in the consistence of one and the same parts; to there equalization. On the basis of the made analyses, we can cite a wide definition of the investments together with the leading categories.
Investment resources – are values, invested into this or that project in this or that kind for the purpose of getting profit beginning with material ones, finished with cash.
Kinds of the prosperity are equal to the kinds of the investment resources and is divided into real and cash, consequently into financial resources.
Real investment resources concern all kinds:
- natural resources;
- labour resources;
- material resources, the usage of which is possible in the economical development (buildings, constructions, vehicles and furniture, transport and communication means and so on;
- investment resources (in the widest understanding, that is from scientific-research and experimental-construction works, till the education potential of the society and till all kinds of gathering useful information, written about every possible, that is typing and electronic bearer).
Cash, consequently financial resources concern every cash means for usage in this way in definite conditions or directed in the sort of investments.
Cash means (resources) turn into the financial resources in the case of structuring of funds of purposeful destination foreseen for investments of this or that kind.
After defining investment resources we can make wide definition of the investments as economical category.
Investments – are the placements of real, financial and intellectual resources into the projects, the fulfillment of which leads us to getting the increases from real wealth, in the material and informational forms. It is followed by a cash (financial) prosperity or its increases (at the expenses of the distribution of the cash means).
As an economical category, investments express economical relations, which are created in the ways of using and formation of the investment resources between the participants of the investment process for the purpose of improving and widening of the enterprise.
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Shawn Bowman asked:
Copyright (c) 2007 Shawn Bowman
With home prices increasing and mortgage rates rising, many homeowners are opting to turn their current home into the home of their dreams through custom home remodeling.
The National Home Builders Association reports that approximately $280 billion was spent on home renovations in 20051. This amount is expected to continue to rise due to the concern for homeowners to add value to their existing home along with their desire to modernize their home. A custom remodel allows the homeowners to reflect their own style and individual tastes ? from integrating a theme to using unique styling and colors.
Two of the most popular custom projects consist of kitchen and bath remodels. These traditionally consist of incorporating a more luxurious look and feel to the existing rooms and may include adding custom products such as high-end tiling, fixtures or elements.
With the current trend in creating an ?open? kitchen and living area for entertaining, comes the emphasis of creating specialty areas specifically designed for individual family needs. With added square footage to open up an area, along with stunning granite countertops throughout, custom cabinetry, and stainless steel appliances that are as beautiful as they are functional, homeowners can now created a modern kitchen that takes center stage and looks fit for a gourmet chef to cook in.
The increasing desire for homeowners to remodel their homes can also be attributed to the increased interest in adding value to an existing home. By incorporating additional square footage, you?ve not only transformed the living space but you?ve instantly increased your home?s resale value. For example, a recent remodeling survey found a midrange remodel costing $10,499 would recoup 102.2% of its cost if the house sold within a year2.
Once you?ve made the decision to remodel, you?ll need to contact an experienced and reputable, licensed general contractor. When considering hiring a general contractor, it?s important to do your homework and thoroughly research your options. Your local homebuilder’s association is an excellent source to find out information on local and established general contractors. Also, ask the contractor for customer references and contact these customers to find out what type of work the contractor did as well as their opinion of the contractor.
What do you look for when hiring a contractor? Hiring the right contractor is detrimental to your remodeling project?s success. Below are some helpful tips to follow:
? Search for a contractor who specializes in the type of remodel job you are interested in.
? Find an experienced contractor who is established and has a presence within your community.
? It?s important to find a contractor who communicates with you and shows enthusiasm about the opportunity.
Your home is one of your most precious and valuable assets. Be sure to protect your investment by finding the right contractor for your remodeling project.
1www.nahb.org
2Weston, Liz Pulliam. (2007) The hottest remodeling trends for 2011. Retrieved October 14, 2007, from http://www.realestate.msn.com/Improve/Article
Copyright (c) 2007 Shawn Bowman
With home prices increasing and mortgage rates rising, many homeowners are opting to turn their current home into the home of their dreams through custom home remodeling.
The National Home Builders Association reports that approximately $280 billion was spent on home renovations in 20051. This amount is expected to continue to rise due to the concern for homeowners to add value to their existing home along with their desire to modernize their home. A custom remodel allows the homeowners to reflect their own style and individual tastes ? from integrating a theme to using unique styling and colors.
Two of the most popular custom projects consist of kitchen and bath remodels. These traditionally consist of incorporating a more luxurious look and feel to the existing rooms and may include adding custom products such as high-end tiling, fixtures or elements.
With the current trend in creating an ?open? kitchen and living area for entertaining, comes the emphasis of creating specialty areas specifically designed for individual family needs. With added square footage to open up an area, along with stunning granite countertops throughout, custom cabinetry, and stainless steel appliances that are as beautiful as they are functional, homeowners can now created a modern kitchen that takes center stage and looks fit for a gourmet chef to cook in.
The increasing desire for homeowners to remodel their homes can also be attributed to the increased interest in adding value to an existing home. By incorporating additional square footage, you?ve not only transformed the living space but you?ve instantly increased your home?s resale value. For example, a recent remodeling survey found a midrange remodel costing $10,499 would recoup 102.2% of its cost if the house sold within a year2.
Once you?ve made the decision to remodel, you?ll need to contact an experienced and reputable, licensed general contractor. When considering hiring a general contractor, it?s important to do your homework and thoroughly research your options. Your local homebuilder’s association is an excellent source to find out information on local and established general contractors. Also, ask the contractor for customer references and contact these customers to find out what type of work the contractor did as well as their opinion of the contractor.
What do you look for when hiring a contractor? Hiring the right contractor is detrimental to your remodeling project?s success. Below are some helpful tips to follow:
? Search for a contractor who specializes in the type of remodel job you are interested in.
? Find an experienced contractor who is established and has a presence within your community.
? It?s important to find a contractor who communicates with you and shows enthusiasm about the opportunity.
Your home is one of your most precious and valuable assets. Be sure to protect your investment by finding the right contractor for your remodeling project.
1www.nahb.org
2Weston, Liz Pulliam. (2007) The hottest remodeling trends for 2011. Retrieved October 14, 2007, from http://www.realestate.msn.com/Improve/Article
kalidas asked:
The most advantageous and efficient way to influence the growth of a business on the electronic market is through online marketing strategies that open the perspective of more targeted audiences and allow one to face tough competition in the best of manners. Maybe some take online marketing as a wonder means to get rich over night, but the truth is that the Internet rush for gold is in fact ghost chasing. Hard work and time are the two elements that are going to bring great business performance and profit, anything other than these is pure speculation. Moreover, let’s not forget the objective factors that influence economic success: the growth or development of the activity domain.
To give a relevant example here, let’s consider the automobile industry in the context of the international financial crisis. If the car sales lower than ever, dealerships and all the businesses that gravitate in this market sector suffer a crash too. Hence, whether regardless of their size companies will have to change the online marketing strategies and start a different approach of the potential customers. Judging from this perspective, the businesses to survive are those to rely on very professional online marketing strategies and on other special measures necessary for times of recession.
One should also be aware of the dark side of online marketing, particularly when one works with programs like Adsense, or Google Adwords. In the Adwords pay-per-click system, Google charges you a fee when someone clicks on an ad, and unfortunately, there have been cases of mean-intended competitors who pay someone to click on ads just for the sake of causing one financial losses. And here, the only thing you can do is keep a very close monitoring of the web site performance and be constantly informed on what is going on with the operations performed by a visitor on the page. Use all the online marketing tools necessary to prevent fraud and mischievous clicks away.
The concepts that keep online marketing so complex are manifold and usually out of reach for the common person who doesn’t have knowledge of the downside of creating a web page. Money gain and loss are in fact both part of the same business play, and it is good strategy and market knowledge that sets the difference. Therefore, the specialists’ advice is to have an expert cover the online marketing side of your business so that you can enjoy great traffic, advantageous return on investment rate and get the money flowing.
The most advantageous and efficient way to influence the growth of a business on the electronic market is through online marketing strategies that open the perspective of more targeted audiences and allow one to face tough competition in the best of manners. Maybe some take online marketing as a wonder means to get rich over night, but the truth is that the Internet rush for gold is in fact ghost chasing. Hard work and time are the two elements that are going to bring great business performance and profit, anything other than these is pure speculation. Moreover, let’s not forget the objective factors that influence economic success: the growth or development of the activity domain.
To give a relevant example here, let’s consider the automobile industry in the context of the international financial crisis. If the car sales lower than ever, dealerships and all the businesses that gravitate in this market sector suffer a crash too. Hence, whether regardless of their size companies will have to change the online marketing strategies and start a different approach of the potential customers. Judging from this perspective, the businesses to survive are those to rely on very professional online marketing strategies and on other special measures necessary for times of recession.
One should also be aware of the dark side of online marketing, particularly when one works with programs like Adsense, or Google Adwords. In the Adwords pay-per-click system, Google charges you a fee when someone clicks on an ad, and unfortunately, there have been cases of mean-intended competitors who pay someone to click on ads just for the sake of causing one financial losses. And here, the only thing you can do is keep a very close monitoring of the web site performance and be constantly informed on what is going on with the operations performed by a visitor on the page. Use all the online marketing tools necessary to prevent fraud and mischievous clicks away.
The concepts that keep online marketing so complex are manifold and usually out of reach for the common person who doesn’t have knowledge of the downside of creating a web page. Money gain and loss are in fact both part of the same business play, and it is good strategy and market knowledge that sets the difference. Therefore, the specialists’ advice is to have an expert cover the online marketing side of your business so that you can enjoy great traffic, advantageous return on investment rate and get the money flowing.
Bard Marketing asked:
With the uncertainty of the economy, legal marketing agency Beyond All Reasonable Doubt Marketing is advising law firms to take a serious look at their budgets. While marketing, advertising and public relations dollars frequently are cut to reduce expenses, marketing experts agree that a down economy is actually the time when marketing efforts should remain in place, and if anything, be enhanced.
“When other law firms reduce their spending and cut their marketing, they have less presence in the marketplace,” explains BARD Marketing founder and president, John Sailer. “This means the time is ripe for a savvy law firm to grab market share – to reach the audience that is still there but who is hearing from fewer of your competitors.”
When planning your law firm’s budget, you should start by identifying how much you want to spend. While there are no hard and fast rules across the different types and sizes of law firms, it makes sense to budget your marketing as a percentage of expected revenue. Several studies have pegged overall law firm marketing budgets to be between 2 percent and 3 percent, with leading firms spending 5 percent or more.
Second, prioritize your initiatives by looking at both costs and expected benefits. This is easy if you tracked your efforts in past years. Remember that some of the lower cost initiatives may bring strong value while some of the higher cost initiatives may bring very little value. With this said, it is imperative to track outcome of every initiative.
BARD Marketing is experienced in budgeting and planning for short- and long-term marketing and advertising plans, and enables law firms to achieve and track ROI for their marketing activities. For more information or to request a report on Yellow Page Advertising Costs and Effectiveness, please visit www.bardmarketing.
With the uncertainty of the economy, legal marketing agency Beyond All Reasonable Doubt Marketing is advising law firms to take a serious look at their budgets. While marketing, advertising and public relations dollars frequently are cut to reduce expenses, marketing experts agree that a down economy is actually the time when marketing efforts should remain in place, and if anything, be enhanced.
“When other law firms reduce their spending and cut their marketing, they have less presence in the marketplace,” explains BARD Marketing founder and president, John Sailer. “This means the time is ripe for a savvy law firm to grab market share – to reach the audience that is still there but who is hearing from fewer of your competitors.”
When planning your law firm’s budget, you should start by identifying how much you want to spend. While there are no hard and fast rules across the different types and sizes of law firms, it makes sense to budget your marketing as a percentage of expected revenue. Several studies have pegged overall law firm marketing budgets to be between 2 percent and 3 percent, with leading firms spending 5 percent or more.
Second, prioritize your initiatives by looking at both costs and expected benefits. This is easy if you tracked your efforts in past years. Remember that some of the lower cost initiatives may bring strong value while some of the higher cost initiatives may bring very little value. With this said, it is imperative to track outcome of every initiative.
BARD Marketing is experienced in budgeting and planning for short- and long-term marketing and advertising plans, and enables law firms to achieve and track ROI for their marketing activities. For more information or to request a report on Yellow Page Advertising Costs and Effectiveness, please visit www.bardmarketing.
The Maverick Marketeer asked:
To really learn about direct marketing and how you can use it to better your business you should first understand what direct marketing is.
According to Wikipedia, direct marketing is defined as “a sub discipline of marketing focused to driving purchases that can be attributed to a specific call to action”. This marketing discipline can include and medium that allows you to communicate directly with customers. Some examples of direct marketing include, direct mail, email, newspaper, radio, television, and of course the internet.
The main focus of any direct marketing strategy is to increase the number of customers that respond to your marketing campaign or “response rate” while also trying to decrease the cost of advertising. Increasing customer response to your advertising will accomplish two very important things. One, increase the number of sales leads generated by advertising, and two, further establish business name recognition.
The ability to properly communicate with your business’s target audience is an extremely important factor in your overall business success. As you learn about direct marketing; keep in mind that persistence really does pay.
One of the most important aspects of designing a successful direct marketing campaign is in targeting your audience. Developing a marketing campaign that speaks directly to your potential customer’s wants and needs will mean the difference between creating quality sales leads for your business and utter frustration at a lack of customer responsiveness.
Several important questions to answer when developing any direct marketing campaign are:
* Who..? Who are you targeting with your particular business message? Who are the people who would be most interested in hearing what you have to say?
* Why..? Do you just want people to review a few helpful products..or do you want them to retain your services?
* What…? What specific benefits are you offering through your message?
* When…? Are you looking for a more immediate response from your reader…or are you providing food for thought and building your relationship?
* Last but not least…How? How do you intend to present and distribute your message to your potential customers?
Your study of direct marketing will be an on going process. It’s important to understand what works for you and your business, what doesn’t, and why that is. The key to success will be in continuing to try different strategies and techniques in order to perfect a particular combination of things that work well for you.
To really learn about direct marketing and how you can use it to better your business you should first understand what direct marketing is.
According to Wikipedia, direct marketing is defined as “a sub discipline of marketing focused to driving purchases that can be attributed to a specific call to action”. This marketing discipline can include and medium that allows you to communicate directly with customers. Some examples of direct marketing include, direct mail, email, newspaper, radio, television, and of course the internet.
The main focus of any direct marketing strategy is to increase the number of customers that respond to your marketing campaign or “response rate” while also trying to decrease the cost of advertising. Increasing customer response to your advertising will accomplish two very important things. One, increase the number of sales leads generated by advertising, and two, further establish business name recognition.
The ability to properly communicate with your business’s target audience is an extremely important factor in your overall business success. As you learn about direct marketing; keep in mind that persistence really does pay.
One of the most important aspects of designing a successful direct marketing campaign is in targeting your audience. Developing a marketing campaign that speaks directly to your potential customer’s wants and needs will mean the difference between creating quality sales leads for your business and utter frustration at a lack of customer responsiveness.
Several important questions to answer when developing any direct marketing campaign are:
* Who..? Who are you targeting with your particular business message? Who are the people who would be most interested in hearing what you have to say?
* Why..? Do you just want people to review a few helpful products..or do you want them to retain your services?
* What…? What specific benefits are you offering through your message?
* When…? Are you looking for a more immediate response from your reader…or are you providing food for thought and building your relationship?
* Last but not least…How? How do you intend to present and distribute your message to your potential customers?
Your study of direct marketing will be an on going process. It’s important to understand what works for you and your business, what doesn’t, and why that is. The key to success will be in continuing to try different strategies and techniques in order to perfect a particular combination of things that work well for you.
SEOJoe asked:
Companies have many options for communicating with prospective customers. The Internet has become the primary medium for reaching potential clients anywhere across the globe. With advent of search and popular brands like Google and Yahoo, the Internet is an excellent source to obtain new clients and build your business beyond your wildest dreams.
Let us begin by outlining the components of Online Marketing.
SEO / Search Engine Optimization:
Short for search engine optimization, the process of increasing the amount of visitors to a Web site by ranking high in the search results of a search engine. The higher a Web site ranks in the results of a search, the greater the chance that that site will be visited by a user. It is common practice for Internet users to not click through pages and pages of search results, so where a site ranks in a search is essential for directing more traffic toward the site.
SEO helps to ensure that a site is accessible to a search engine and improves the chances that the site will be found by the search engine.
PPC . Pay Per Click:
Pay per click (PPC) is an advertising technique used on websites, advertising networks, and search engines.
Advertisers bid on “keywords” that they believe their target market (people they think would be interested in their offer) would type in the search bar when they are looking for their type of product or service. For example, if an advertiser sells red widgets, he/she would bid on the keyword “red widgets”, hoping a user would type those words in the search bar, see their ad, click on it and buy. These ads are called “sponsored links” or “sponsored ads” and appear next to and sometimes above the natural or organic results on the page. The advertiser pays only when the user clicks on the ad.
While many companies exist in this space, Google AdWords and Yahoo! Search Marketing, which was formerly Overture, are the largest network operators as of 2006. In the spring of 2006, MSN started beta testing their own PPC service, MSN adCenter. Depending on the search engine, minimum prices per click start at US$0.01 (up to US$0.50). Very popular search terms can cost much more on popular engines. Abuse of the pay per click model can result in click fraud.
Pay per click (PPC) is an advertising technique used on websites, advertising networks, and search engines.
Advertisers bid on “keywords” that they believe their target market (people they think would be interested in their offer) would type in the search bar when they are looking for their type of product or service. For example, if an advertiser sells red widgets, he/she would bid on the keyword “red widgets”, hoping a user would type those words in the search bar, see their ad, click on it and buy. These ads are called “sponsored links” or “sponsored ads” and appear next to and sometimes above the natural or organic results on the page. The advertiser pays only when the user clicks on the ad.
While many companies exist in this space, Google AdWords and Yahoo! Search Marketing, which was formerly Overture, are the largest network operators as of 2006. In the spring of 2006, MSN started beta testing their own PPC service, MSN adCenter. Depending on the search engine, minimum prices per click start at US$0.01 (up to US$0.50). Very popular search terms can cost much more on popular engines. Abuse of the pay per click model can result in click fraud.
Affiliate Marketing
Affiliate marketing is a method of promoting web businesses in which an affiliate is rewarded for every visitor, subscriber, customer, and/or sale provided through his/her efforts. It is a modern variation of the practice of paying a finder’s fee for the introduction of new clients to a business. Compensation may be made based on a certain value for each visit (Pay per click), registrant (Pay per lead), or a commission for each customer or sale (Pay per sale), or any combination.
Merchants like affiliate marketing because it is a “pay for performance model”, meaning the merchant does not incur a marketing expense unless results are realized.
Some e-commerce sites run their own affiliate programs while other e-commerce vendors use third party services provided by intermediaries to track traffic or sales that are referred from affiliates. Some businesses owe much of their growth and success to this marketing technique, although research has shown in general the increase to be approximately 15-20% of online revenue.[citation needed]
Merchants who are considering adding an affiliate strategy to their online sales channel have different technological solutions available to them. Some types of affiliate management solutions include: standalone software, hosted services, shopping carts with affiliate features, and third party affiliate networks.
Revenue generated online grew quickly. The e-commerce website, viewed as a marketing toy in the early days of the web, became an integrated part of the overall business plan and in some cases grew to a bigger business than the existing offline business. Many companies hired outside affiliate management companies to manage the affiliate program
Online Reputation Management
Online reputation management is a developing field that encompasses public relations and search engine optimization.
Consumers go online to make buying decisions. When they research brands using search engines, the results that they observe often influence how they behave. Consumer generated media sites offer the general public the opportunity to express their views of brands. This information can be found in search engine results. Members of the public such as competitors, and ex-employees can take part in the online conversation which can adversely affect the brand reputation.
Online reputation management is a field that involves the monitoring of online conversation, and the action undertaken, to improved brand reputation within search engine results.
These components are extremely crucial in order to successfully marketing your website online. We the right Online Marketing firm, you company can see exponential growth with a highly satisfactory ROI. The most rewarding side effect of online marketing is the brand recognition that comes with your campaign. The actually campaign effectiveness can be tracked in terms of dollars through ROI calculations. However, this is a short –term terms. The long –term benefit of a well executed online marketing campaign will positively affect your brand. This is priceless!
Companies have many options for communicating with prospective customers. The Internet has become the primary medium for reaching potential clients anywhere across the globe. With advent of search and popular brands like Google and Yahoo, the Internet is an excellent source to obtain new clients and build your business beyond your wildest dreams.
Let us begin by outlining the components of Online Marketing.
SEO / Search Engine Optimization:
Short for search engine optimization, the process of increasing the amount of visitors to a Web site by ranking high in the search results of a search engine. The higher a Web site ranks in the results of a search, the greater the chance that that site will be visited by a user. It is common practice for Internet users to not click through pages and pages of search results, so where a site ranks in a search is essential for directing more traffic toward the site.
SEO helps to ensure that a site is accessible to a search engine and improves the chances that the site will be found by the search engine.
PPC . Pay Per Click:
Pay per click (PPC) is an advertising technique used on websites, advertising networks, and search engines.
Advertisers bid on “keywords” that they believe their target market (people they think would be interested in their offer) would type in the search bar when they are looking for their type of product or service. For example, if an advertiser sells red widgets, he/she would bid on the keyword “red widgets”, hoping a user would type those words in the search bar, see their ad, click on it and buy. These ads are called “sponsored links” or “sponsored ads” and appear next to and sometimes above the natural or organic results on the page. The advertiser pays only when the user clicks on the ad.
While many companies exist in this space, Google AdWords and Yahoo! Search Marketing, which was formerly Overture, are the largest network operators as of 2006. In the spring of 2006, MSN started beta testing their own PPC service, MSN adCenter. Depending on the search engine, minimum prices per click start at US$0.01 (up to US$0.50). Very popular search terms can cost much more on popular engines. Abuse of the pay per click model can result in click fraud.
Pay per click (PPC) is an advertising technique used on websites, advertising networks, and search engines.
Advertisers bid on “keywords” that they believe their target market (people they think would be interested in their offer) would type in the search bar when they are looking for their type of product or service. For example, if an advertiser sells red widgets, he/she would bid on the keyword “red widgets”, hoping a user would type those words in the search bar, see their ad, click on it and buy. These ads are called “sponsored links” or “sponsored ads” and appear next to and sometimes above the natural or organic results on the page. The advertiser pays only when the user clicks on the ad.
While many companies exist in this space, Google AdWords and Yahoo! Search Marketing, which was formerly Overture, are the largest network operators as of 2006. In the spring of 2006, MSN started beta testing their own PPC service, MSN adCenter. Depending on the search engine, minimum prices per click start at US$0.01 (up to US$0.50). Very popular search terms can cost much more on popular engines. Abuse of the pay per click model can result in click fraud.
Affiliate Marketing
Affiliate marketing is a method of promoting web businesses in which an affiliate is rewarded for every visitor, subscriber, customer, and/or sale provided through his/her efforts. It is a modern variation of the practice of paying a finder’s fee for the introduction of new clients to a business. Compensation may be made based on a certain value for each visit (Pay per click), registrant (Pay per lead), or a commission for each customer or sale (Pay per sale), or any combination.
Merchants like affiliate marketing because it is a “pay for performance model”, meaning the merchant does not incur a marketing expense unless results are realized.
Some e-commerce sites run their own affiliate programs while other e-commerce vendors use third party services provided by intermediaries to track traffic or sales that are referred from affiliates. Some businesses owe much of their growth and success to this marketing technique, although research has shown in general the increase to be approximately 15-20% of online revenue.[citation needed]
Merchants who are considering adding an affiliate strategy to their online sales channel have different technological solutions available to them. Some types of affiliate management solutions include: standalone software, hosted services, shopping carts with affiliate features, and third party affiliate networks.
Revenue generated online grew quickly. The e-commerce website, viewed as a marketing toy in the early days of the web, became an integrated part of the overall business plan and in some cases grew to a bigger business than the existing offline business. Many companies hired outside affiliate management companies to manage the affiliate program
Online Reputation Management
Online reputation management is a developing field that encompasses public relations and search engine optimization.
Consumers go online to make buying decisions. When they research brands using search engines, the results that they observe often influence how they behave. Consumer generated media sites offer the general public the opportunity to express their views of brands. This information can be found in search engine results. Members of the public such as competitors, and ex-employees can take part in the online conversation which can adversely affect the brand reputation.
Online reputation management is a field that involves the monitoring of online conversation, and the action undertaken, to improved brand reputation within search engine results.
These components are extremely crucial in order to successfully marketing your website online. We the right Online Marketing firm, you company can see exponential growth with a highly satisfactory ROI. The most rewarding side effect of online marketing is the brand recognition that comes with your campaign. The actually campaign effectiveness can be tracked in terms of dollars through ROI calculations. However, this is a short –term terms. The long –term benefit of a well executed online marketing campaign will positively affect your brand. This is priceless!
Alan King asked:
If you are considering custom products as a part of your marketing budget, then making wise choices in your items should be your first priority. Research shows varying statistics on the effectiveness of different products. In most cases, keeping it simple will be the best way to go. After choosing the custom product that works best for your company, the exposure you get will be more valuable than any other form of advertisement.
Traditional custom products should clearly advertise the company name and contact information. You will want to choose an item that has enough room for your logo, company name, phone number, and website at the very least. There have been countless incidents where people have offered trade show giveaways or free gifts at community events just to attract more traffic, but they forgot to brand their items. The blank item that was given was probably remembered for about as long as it took to pick up. Custom products with the company information have a life of at least six months or longer.
Items that are affordable and useful work as everyday portable billboards. Some of the most popular custom products include promotional pens and writing instruments, tote bags, mugs or stainless steel coffee tumblers, logo key chains or key tags, and calenders. These items are used repetitively because they work. Promotional products offer more exposure on a daily basis than any other form of advertisement.
The best custom products are the ones that you use on a daily basis. Things like sticky pads, pens, and notepads seem to be used most often by businesses. Unless you have something out of the ordinary to offer or the budget for cool items like USB flash drives or memory cards, the traditional items will get you the most recognition.
Maybe you are looking for something that is new and interesting, something that will catch the attention of your client base and set you apart from the crowd. If you cater to a certain profession, the career-orientated options are endless. Maybe you are selling a product for building houses. In that instance, a tape measure or carpenter’s pencil are ideal items that will be valued and used over and over again.
Something that sets you apart from the crowd is a good idea, but choose wisely and make sure you don’t cross over into “trendy” territory. Once the trend loses its impact, so do your advertising dollars. What you choose says a lot about the image you are trying to portray. Most companies will want to appear professional and sensible.
The advantages to custom products are numerous. People who receive custom products are usually more willing to generate sales leads. A promotional gift will also lead to more referrals and reorders. Goodwill towards a company giving promotional product is more likely to occur.
Custom products are an excellent way to get noticed and can be simply stated. Promotional items will gain respect and an attachment to your company. A good custom product will have more impact than any other media because of the repeat exposure to several potential customers that it offers.
If you are considering custom products as a part of your marketing budget, then making wise choices in your items should be your first priority. Research shows varying statistics on the effectiveness of different products. In most cases, keeping it simple will be the best way to go. After choosing the custom product that works best for your company, the exposure you get will be more valuable than any other form of advertisement.
Traditional custom products should clearly advertise the company name and contact information. You will want to choose an item that has enough room for your logo, company name, phone number, and website at the very least. There have been countless incidents where people have offered trade show giveaways or free gifts at community events just to attract more traffic, but they forgot to brand their items. The blank item that was given was probably remembered for about as long as it took to pick up. Custom products with the company information have a life of at least six months or longer.
Items that are affordable and useful work as everyday portable billboards. Some of the most popular custom products include promotional pens and writing instruments, tote bags, mugs or stainless steel coffee tumblers, logo key chains or key tags, and calenders. These items are used repetitively because they work. Promotional products offer more exposure on a daily basis than any other form of advertisement.
The best custom products are the ones that you use on a daily basis. Things like sticky pads, pens, and notepads seem to be used most often by businesses. Unless you have something out of the ordinary to offer or the budget for cool items like USB flash drives or memory cards, the traditional items will get you the most recognition.
Maybe you are looking for something that is new and interesting, something that will catch the attention of your client base and set you apart from the crowd. If you cater to a certain profession, the career-orientated options are endless. Maybe you are selling a product for building houses. In that instance, a tape measure or carpenter’s pencil are ideal items that will be valued and used over and over again.
Something that sets you apart from the crowd is a good idea, but choose wisely and make sure you don’t cross over into “trendy” territory. Once the trend loses its impact, so do your advertising dollars. What you choose says a lot about the image you are trying to portray. Most companies will want to appear professional and sensible.
The advantages to custom products are numerous. People who receive custom products are usually more willing to generate sales leads. A promotional gift will also lead to more referrals and reorders. Goodwill towards a company giving promotional product is more likely to occur.
Custom products are an excellent way to get noticed and can be simply stated. Promotional items will gain respect and an attachment to your company. A good custom product will have more impact than any other media because of the repeat exposure to several potential customers that it offers.
