Good Marketing Pays for Itself

Most companies ask themselves this question: "How much will this advertising cost us?" when they should actually be asking themselves: "How much will it cost not to do this advertising?"

If your company spends $1000 per week on marketing then you could save $1000 per week by not doing any marketing. That is true but it is the simple and shortsighted view of the situation. However, if the revenue generated from that marketing is $1010 you have actually just lost $10 by not doing it. Most times the margin is not that slim. We generally bring in around 10 times what we spend in any given week. That means for every $1000 we spend on marketing we bring in $10,000. If we decided that we were only going to spend half of what we were normally spending we would automatically save half of our budget. That is great but we would likely lose up to half of our weekly sales income. In trying to save half our budget, we actually lost 9 times that amount.

It all comes back to your return on investment (ROI). The money that you spend on your marketing is your investment. The money you bring in on sales is the ROI. That is why your ROI is the most important statistic to consider when trying dividing up your marketing budget. Putting more money into a marketing strategy that has a higher ROI doesn't cost you more money, it makes you more money. Unfortunately many businesses cut their marketing budget first when trying to stay afloat during slow periods. They are actually hastening their downfall.

You have heard it time and time again, "It takes money to make money." It is as true today as it ever has been. You have a good product or service, you run your business well, the only thing that you need is good marketing and that will eventually pay.

Maybe you are still stopped by the big question, "How?" What do you really need to know and how can you actually make it work? Let's start with the "Basic Principles" of promotion.

What is Promotion?
Anything as advertising, public appearances, etc., done to publicize (get the attention or interest of the public) a person, product, event etc.

Why to promote?
The purpose of promotion is to bring in more business and enlarge your customer base. Always try to bring in as much business as you can. It sounds like an obvious thing to say but many people still don't follow this rule. Don't assume any number of new customers will be too much for you to handle. If you have that much business you can always bring on temporary or temp-to-permanent staff to handle the work load.

How do you promote?
There are more ways than you would ever think. Have you ever heard someone say, "I never promote and I am always busy" or "I don't have to promote, all my business comes from word-of-mouth"? They may not be aware of how they're doing it, but I promise you they are promoting somewhere. Maybe they just go around telling everyone they talk to, that they don't promote. (Sounds funny? It's still promoting.) Well here are some ideas you can do "knowingly" to drive in the business. Every action that every member of your staff engages in is promotion. Whether good or bad every action is giving someone an impression of how your company is or does business. Here are a few examples.

• Greeting your customers with a smile and professionally is a great way to start.
• Calling your customers after they have had a chance to use your product is a good way to promote that you care about their experiences with your organization. It can also create an opportunity to make more sales.

I suggest you sit down and write out all the things that your company actually does to promote using the above definition. Every little detail counts. Thanks for reading and good luck.

Foreign exchange of Nepal: A Brief History

Different currencies and the need to exchange them had existed since the Babylonians (who are credited with the first use of paper notes and receipts). Foreign exchange or foreign currency is the currency of an overseas country, which is purchased by a particular country in exchange for its own currency. The foreign exchange rate is the price of a country's currency in terms of another country's currency. The exchange rate is crucial in maintaining balance of receipts and payments between two trading countries. Understanding of the history of a countries exchange rate is important to formulate the country's exchange rate policy.

Commercial relationship between Nepal and India has existed more than five hundred years before Christian era. By first half of seventh century when the Lichhavis were ruling, Nepal had become the country of transit trade between India and Tibet. Barter system prevailed during those days. Nepal was divided into various small states, few states had there own metallic currencies. Exchange rates during that era were determined according to the market. Metals like gold and silver was mostly used as means of exchange. It was only after unification of Nepal did have a single currency. But minted coins came into use only after Jung Bahadur Rana set up a minting machine in Kathmandu.

Nepal has a rich history on foreign exchange. Evolution of Nepal's exchange rate policy begun only after unification of Nepal in 1769. We moved from having no defined exchange rate policy, but being market determined, to have clear exchange rate policy. Nepal's foreign exchange policies can be differentiated into six distinct periods. These periods are:

Floating exchange rate period
Prior to establishment of Nepal Rastra Bank, many currencies along with Nepalese currency were circulated in Nepal. The value between each currency was determined by market. Fluctuations in supply and demand of currencies were reflected in the floating rates. However, the currency was metallic and its value was based on metallic content. It existed up to 1956.

Dual currency period
Our country had dual currency from 1835 to 1934. Both Nepalese currency and Indian currency were used as currency of exchange in Nepal. Indian paper currency was acceptable for heavy transactions. Both Nepalese and Indian paper and metal currencies circulated. It lasted up to mid 20th century. In Kathmandu, Nepalese currency dominated whereas in Terai (near the border of India) Indian currency was heavily circulated but in hilly regions barter system still prevailed.

Pegged exchange rate period
1951 to 1955 was extremely volatile in respect to Nepalese currency-Indian currency exchange market. Changes occurred daily. Fluctuation in the value of Indian currency against value of Nepalese currency remained a source of unnecessary irritation and trouble for all walks of life until 1957 when the system of dual currency system was abolished under Nepal Currency Circulation and Expansion Act. Due to the volatile market of Nepalese currency and Indian currency and its adverse effect on confidence of Nepalese currency and economy of Nepal, the dual currency system was abolished and a single currency was fixed. Nepalese currency was pegged with Indian currency with unlimited convertibility at the fixed rate of 160NC to 100IC. Nepalese currency has been fixed with Indian currency for last 40 years with only 7 changes in the exchange rate so far.

Dual exchange rate period
After World War II, the foreign exchange market of the world became volatile. In order to bring economic order, United Nations Monetary Fund convened the Bretton Woods Accord. It established the policy of pegging currencies against the U.S. dollar so as to bring stability to a fractured and volatile global economic situation.

The first element of the Accord was to peg the U.S. dollar to the price of gold at $35.00 an ounce (The gold standard). With this benchmark anchoring the U.S. dollar, other major currencies were pegged to the greenback and allowed to fluctuate no more than 1% on either side of the pegged rate.

With accordance with the Bretton Woods system, Nepal Rastra Bank pegged 1 USD with 7.60 Nepalese currency. As Nepalese currency was already pegged with Indian currency, we adopted a Dual pegged system, i.e., one with USD (7.60=1USD) and second with Indian currency. This period extended from 1960 to 1973.

Basket of currency period
After collapse of Bretton Woods System in 1971, Nepal adopted the basket of currency system from 1983 to 1992. On June 1st 1983, Nepalese currency was pegged with basket of currencies. Basket of currency includes number of currencies based on trade weights. The exact composition of basket of currencies had not been divulged by Nepal Rastra Bank. Indian currency was also included in basket of currency, so Nepalese currency-Indian currency rates also changed on daily basis during that period.

Floated exchange rate periodBasket of currency system was discarded in 1992 and Nepalese currency was floated according to the demand for and supply of the market. Nepalese currency-Indian currency was again pegged at 160 Nepalese currency for 100 Indian currency. Other currencies were floated under supervision of Nepal Rastra Bank, i.e., from 1992 onwards Nepal adopted a managed float system. The central bank intervenes with floating exchange rate using various policies to maintain the desired exchange rate. The Central Bank provides money if exchange rates are dropping to bring it up again. This is the present status of our foreign exchange policy.