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The Scope Of AI In The Retail Business



While 40% prove no interest in this technology, 44% of retail businesses (the highest of all industries) say they aren’t challenged by the process of implementing AI or ML whereas 39% admit their unawareness of AI or ML’s inclusion in their options for accounting solutions.

Though 72% of most medium-sized businesses already utilize AI and ML, 13% of very small businesses are trailing behind all sectors with their incorporation of AI in the workflow solely for the following purposes: bookkeeping (76%), invoicing (61%), payroll processing (60%) and bill paying (55%).

Following the report, ScaleFactor founder and CEO Kurt Rathmann explained, “Small businesses are finding increased value in adopting technology solutions to assist in the back office as customer demand for quickness and e-commerce solutions increase.” He supplements this by saying that organizations are now steering their focus on the use of insightful and prescriptive technology as a solution to complex back-office operations and to harness the efficiencies of an intelligent workforce in growing the business.

With AI and ML technologies, 58% of SMBs now use accounting/back office tech solutions while 76% have no plans to hire full-time or fractional Chief Financial Officers. Only 23% have a full-time, dedicated CFO.

On another note, financial sources depend on the size of the company. The funding of mid-size businesses usually comes through loans from financial institutions. For small businesses, 59% of financing is done with the use of the owners’ credit cards, while 77% of very small businesses reinvest their profits into the business.

Further into the numbers of the ScaleFactor report, a majority of those surveyed revealed a stable or growing revenue number since last year. Only 4% experienced a decrease in revenue over 2018 whereas 44% saw a 10% or more increase in revenue growth.

In the survey, retail businesses prove to have the highest rate of new hires amongst the vertical industries, with 22% of businesses reporting two to three new hires in the past 12 months. That said, many businesses have called off the hunt for new staff, with 52% of these businesses claiming no new hires in the past 12 months. Salary costs is said to be the biggest reason for not hiring new staff, and shortages in labor skills presented another challenge to those in the tight labor market.

With the use of artificial intelligence in business applications for work processes automation, data analytics, and natural language processing, businesses can easily expect an increase in sales, detect fraud, and improve customer experience. In the retail segment, consumer experience is shaped by the small retailers’ engagement in e-commerce platforms where giant online retailers like Amazon and Walmart compete.

Artificial intelligence can also aid operations by introducing automation to the workforce’s repetitive, unproductive tasks to help them better focus on high-priority roles that require human participation. This increase in efficiency can, in turn, translate to higher profits for businesses. Moreover, massive customer data and behavior can be easily collected and organized using AI to create tailored experiences for them. Such insights can transform the customers’ engagement with your products as you fit them based on their interests and likes. Finally, strategic decisions can be derived from the analysis of the product’s market performance from past data.

Whether it involves cases on marketing, customer service, or sales, AI or machine learning can personalize solutions to further revolutionize the retail industry.

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Big Change Ahead: Facebook On Monetizing WhatsApp



Just 14 months earlier, the management of WhatsApp stated that the company’s main monetization mode will be advertising. But at present, there are plans to put the ads in WhatApp on hold. The advertising team was disbanded and their code was also deleted. 

Facebook planned to begin placing ads in the WhatsApp status which is similar to Instagram Stories. The prototype was supposed to be previewed in May. But with the hold status of this plan, it is no longer certain when the feature will be released. 

The WhatsApp Status ads are comparable to Instagram Stories and both features almost have the same number of users. However, Instagram users are much more focused on the North American market. 

One of the challenges here is that the ability of the marketers to target ads on the app and they may not get similar results to that of Instagram. WhatsApp is more private while on Instagram, users share and basically broadcast what their interests are. 

It’s possible for Facebook to use its existing user data from other apps. But there’s a good number of WhatsApp users who are yet to connect their Facebook account to the ones they have in WhatsApp. 

The company acquired the messaging app in 2014 for $19 billion. Its investors are probably wondering how Facebook will monetize the service which has over 1.5 billion users. Instead of adds, Facebook is exploring on enabling businesses to connect with their consumers using WhatsApp. 

One of the efforts toward this direction is the WhatsApp Business. The app was launched a couple of years ago. A paid API was then added after a few months. WhatsApp Business encourages businesses to quickly respond to clients. It also makes it easier for businesses, both big and small, to get in touch with their consumers using the messaging app. 

Facebook gave its investors an update last year. It stated that WhatsApp Business already has 5 million active businesses. Since then, the iOS version of the app was released. The most recent feature of WhatsApp Business is Catalogs. With it, users can discover products from businesses and merchants that they correspond with on the app. 

Another thing that Facebook is working on is developing a payment platform on the messaging app. They’re going to start it in India. However, this feature has been delayed because the Indian government is concerned regarding data localization. At present, Facebook is looking into other ways that it can extend Facebook Pay to the company’s other apps. 

The focus of Facebook is providing businesses with more tools so that they can connect with their clientele better and easier. This step away from invasive ads will most likely pay off for the long term. What the company needs to create is the habit of learning, discovering, and purchasing products on WhatsApp which is common with Instagram users. 

The company can provide paid tools for various businesses so that this habit may be facilitated. After making the messaging app a place for commerce, it may have a more significant opportunity in advertising with the WhatsApp Status. 

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What Defines A Small Business & A Large Business?



According to the U.S Small Business Administration or SBA, a small business is a business that comprises of independent owners and is an entity that is not dominant in its respective field. The size of a business is essential because there is an array of laws that applies to large companies — also, the size of business assists in determining the company’s entitlement for federal contracts and programs.

To determine the size of a business, the average number of employees, as well as the average of annual receipts, are taken into account by the federal government. Usually, a company that has 500 or more employees and have an average of $7 million in annual receipts are considered to be under the large business category. However, there are exceptions to these standards in some industries.

Based on the SBA guidelines, some manufacturing companies which employ 1,500 individuals can still be determined to be a small business. While on the other hand, in the construction industry, a business that has an annual receipt of $33.5 million is defined to be a large business. In the dredging industry, if a company has a total average revenue of $20 million or less, it is a small business; this also applies to specialty trade contractors who have an average annual receipt of $14 million or less.

Research & Development Businesses

Businesses who are in the research and development industry are the only service businesses where the government considers the size of employees to determine whether it is small or large. Commonly, retail companies who have an annual receipt of $7 million or more is a large business. Although, a grocery store, car dealer, electrical appliance business can be considered under the small business category if it has an average annual receipt of less than $35.5 million.

Foreign & Domestic Affiliations     

International and Domestic Affiliations are also subject to classification. If an affiliation has over 50 percent of voting stock, then it is considered a large business.

The SBA says that a large business entails a CEO having power over a company due to widely distributed stocks, several people who have the same business interests, or an economic dependency upon a company.

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Apple’s Services Business Is Expected To Be Valued At $650 Billion This Coming Year



The 2019 year marked the success of Apple’s services business as the company introduced a bunch of new services last March of 2019. Offerings like Apple Card, Apple TV, and Apple Arcade are aimed to latch consumers into patronizing the brand. 

Dan Elves, a Wedbush analyst, had expressed his expertise and said that Apple Services could be worth $500 billion to $650 billion by the year 2021. The anticipated worth of the company’s services business will be similar to Facebook’s value in the present day. 

Having said that, the company is still expected to grow over the next coming years, especially if the 5G iPhone supercycle hits the market; this will also increase the company’s sales as users will upgrade their units to take advantage of the 5G wireless networks. 

Today, there are an estimated 350 million iPhone users in the upgrade window, and that number is expected to increase by 50 million over the next two years. 

Growing Out Their Gross Margin 

Apple just recently broke down its cost of sales, and the numbers did not disappoint. Experts predicted that the gross services margin would be about 55%, but in the year 2018, the company’s services gross reached over 61% and rose to 63.7% in 2019. Those numbers still have the potential to grow over time; however, investors should still remain cautious because the company is making long-term investments with its services business. 

A business worth $60 billion with a gross exceeding 60% is undoubtedly a precious asset. 

For a clear standpoint, Facebook has garnered $66.5 billion in revenue with a gross margin exceeding 80% over the past 12 months, and the market presently values the company at $630 billion. Its revenue is also increasing at a faster pace than Apple’s services business. 

Nonetheless, Apple’s services business has no comparison, as each business is unique. With its high-margin and fast-growing source of revenue, it’s vital characteristic is in the Apple ecosystem. This feature is an advantage for the company because Apple device owners are likely to purchase devices and subscriptions from the tech company. 

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