If your business has an active presence on social media, you may want to create and implement a social media policy for your company to abide by. Social media platforms provide businesses with reach – reach to connect with and engage their target audience, share their brand mission, and create brand awareness, among other things. With this reach, however, also comes great responsibility. As seamless as it is to share exciting company news or promote a new product, it’s just as easy to post or share the wrong thing and damage your company’s reputation.
Putting a clear social media policy in place will create guidelines for you and your employees as to the type of content your company can share on its channels. In this article, we’ll dive into this idea further, highlighting what a policy should contain, why it’s important, and who needs to follow it.
What is a Social Media Policy?
A social media policy is a company-wide guideline that outlines how your employees should present themselves and your brand on the internet. It reinforces the company’s values, brand identity, and voice, and sets the parameters for what is appropriate and inappropriate to post. The goal being to protect the company’s reputation and avoid a communications crisis from occurring.
Putting this policy together should be a collaborative effort that combines the expertise and input of different critical people in the company, like the social media manager, public relations manager, CEO, and marketing director.
Why is Social Media Policy Important?
The bigger your company’s presence is on social media, the more reach you have, and thus, the more devastating of an impact a negative post could have. It’s not just that a single post can reach hundreds of thousands of people, it’s also that it reaches them very rapidly.
Once you post something, your followers can see it and share it, save it, report it, etc. Even if a negative post is eventually deleted, there’s a level of damage that’s already done. That’s why the best way to protect your company from such occurrences is to prevent them altogether through the implementation of a social media policy.
Additional perks of having a social media policy include:
- Maintaining your company’s identity across all social media platforms.
- Protecting your company from any legal crisis (i.e., employees sending out offensive posts or accidentally letting out confidential company information to the public).
- Providing a guide for addressing a PR crisis, should one occur.
- Encouraging employees to be responsible and mindful of what they post about the company on their personal social media accounts.
What Should Your Policy Include?
Here’s a breakdown of the things you’ll need to address when crafting your company’s social media policy:
1. Who Can Access Your Company’s Accounts
When running social media for your business, one of the first things to consider is the people who will have access to the company’s accounts. Meaning, who will be allowed to post and engage with followers on the company’s behalf.
The expression too many cooks in the kitchen definitely apply here. The more people who have access to the accounts, the more opportunities there are for mistakes to be made. You also want to keep your brand’s voice consistent which is harder to manage if more people are posting from your accounts. Consider hiring a social media professional to be the primary person who manages your various accounts and keeps everything streamlined.
2. The Role of Each Team Member
While you want to regulate the number of people actually creating and posting content for the company, it definitely takes a larger team to implement social media marketing strategies as a whole. Additional roles may include:
- Customer service
- Handling of security and passwords
- Strategy planning
- Crisis management and risk mitigation
- Social media monitoring and listening
- Social media training
Anyone involved with social media work in any capacity needs to know what their responsibilities are. In addition, they should know what their role would look like in the event of a communications crisis. This way there is no confusion or misunderstanding as to who handles what should one occur.
3. What Your Security Protocols Are
If you have social media accounts, you should definitely set up a security protocol to protect those accounts from online hackers. In this section of your social media policy, you’ll outline how your team should maintain your social media accounts’ safety. You should also include the back-up plans you have in place in case a breach happens.
Here are some helpful questions to ask when creating your social media’s security protocol:
- Who has access to your accounts?
- Is there an authorized person to handle password changes? If so, who?
- Do you have a place where you can safely store your passwords?
- How does the person in charge of handling the passwords inform the social media team of any log-in changes?
Answering these questions will help you establish a clear plan on how you’ll protect your social media accounts. Most importantly, you’ll be able to create a list of actions for when things go wrong regarding your security system (i.e., hacking incidents).
4. Legalities to Abide By
Your social media policy should also outline the legalities that your social media managers and other employees must adhere to. It’s one thing when a mistake hurts a brand’s reputation, but a whole other when the mistake has legal repercussions – for instance infringing on a copyright. It’s important to emphasize the legal restrictions and ramifications in your social media policy so your employees are fully aware of the types of activities they should stay away from to keep the company out of legal trouble.
At the very least, your company’s policy should touch on the following legal areas:
- Confidentiality. Consider how your employees can share information over the internet. What things are they allowed to disclose to the public? Which pieces of company information should be kept confidential? Be sure that your employees know what the ramifications are if they violate your company’s confidentiality in any way.
- Privacy. Especially if your business is in the finance or healthcare industry, client privacy is a must. Disclosing any information regarding your customers not only puts your company in trouble but could also endanger the safety of those customers. People over the internet could easily use the information to take advantage and put your clients in harm’s way.
- Copyright. Using any forms of media – videos, photos, graphics, artwork – on your social media or website without properly giving credit to the original source could predispose your company to legal problems. Explain how your social media managers should handle copyrighted material, especially if using third-party sources.
5. Guidelines for Personal Conduct on Social Media
According to Pew’s survey, 40% of American workers report that their company doesn’t have a social media policy. Even if your company doesn’t have its own accounts, you should still have a policy in place that outlines what employees are able to share on their personal accounts as it pertains to the company. They need to know that they are not allowed to share private information or just say anything about the company on their own accounts.
Consider any actions they could take on their personal accounts that could negatively affect the brand. This includes:
- Posting plagiarized content
- Posting offensive or discriminating remarks
- Uploading inappropriate and obscene pictures
In addition to setting the rules, your policy should also outline the consequences an employee would face if they broke any of those rules.
6. Your Social Media Crisis Management Plan
While the purpose of the social media policy is to prevent a PR crisis from happening as a result of actions taken on social media, you should always have a plan set in place should one occur. This plan should clearly outline the roles of different team members in the event of a crisis and provide the actionable steps to be taken.
Sit with your team and try to identify any type of crisis that could occur and create a pre-approved response to each. It’s always better to over-plan when it comes to crisis communications because you’ll need to act fast, should that moment arise. The more details you set in place, the quicker and more streamlined your response will be.
Final Thoughts on Social Media Policy for Small Businesses
It’s worth noting that your company’s social media policy isn’t meant to discourage your employees to refrain from using their social media accounts. Instead, it’s meant to guide them as to how they should behave online because anything they say or do could directly reflect the organization of which they are a part of.
Once you have the policy in place, distribute it immediately to your employees. The faster you’re able to disseminate the information, the sooner you can implement the policy. Finally, don’t forget to review your social media policies on a biannual or annual basis. It ensures that your policy will stay up to date and relevant.
1. Determine Your Startup Costs
Understanding your startup costs is vital because it will determine how much loan you need (and afford) and what type of financing you’ll apply for. Every business is unique, and thus, will have different initial expenses. However, they do share some standard costs. This includes:
- Office supplies, like computers, cash registers, tables, chairs, etc.
- Registrations, permits, and licenses
- Fixtures like cubicles, desks, lighting, and others.
Aside from the startup costs, you’ll also have to consider your operating expenses for the first few months, such as:
- Mortgage payments
Research what expenses go into your business. When calculating the costs, be sure to use realistic estimations. If you set the loan amount too high, there’s a high chance that the lender won’t approve your loan. On the other hand, if you ask for too little, it might not be enough to cover your initial and ongoing costs.
2. Review Your Qualifications
As mentioned, lenders will have different business loan requirements. Banks, for instance, may only loan money to the most creditworthy borrowers. On the other hand, alternative lenders may be willing to work with borrowers with poor credit.
When it comes to business loan applications, lenders will consider several eligibility factors. Specifically, the lenders will look at your credit score, business plan, loan amount, and your ability to provide collateral.
Here’s a breakdown of each:
a. Credit Score
As mentioned, your credit score will tell lenders about your credit behavior. The higher it is, the better your chances are at loan approval.
If you’re applying from banks, chances are, you need a credit score between 680 to 850. They typically reserve their low-rate business financing only to creditworthy customers. If your credit score falls below that threshold, you might have better chances of qualifying for business financing from alternative lenders. The downside is, you might have to pay higher interest rates and fees as it’s the lender’s way of mitigating the risk.
If you can afford to postpone the loan application process, you can always work on improving your credit score. Once it reaches a good point, you can then submit your loan application to lenders.
b. Financial Projections
Typically, the lenders will look at the business’ revenue and cash flow when assessing your ability to pay the loan. However, since you’re still in the process of getting your business up and running, the lenders will turn to your financial projections as their way of determining your business’ profitability.
Your financial projections should be included in your business plan. It should contain your future sales, profits, cash flow, revenue, etc. Ideally, you should prepare at least three financial projections: pessimistic, optimistic, and most likely forecasts. This will help you and the lenders foresee the impacts of each scenario.
It’s also a good idea to include a contingency plan in case some event throws off your forecasts. This will show the lenders that you have thought the project through and that you’ll fare well if something unexpected does happen.
c. Collateral and Personal Guarantee
Some lenders will require collateral if you’re applying for a loan to start a business. Collateral can either be a personal or business asset that you pledge to act as security for the loan. It could be real estate properties, vehicles, equipment, or inventory that the lenders can seize in case of nonpayment.
Pledging collateral typically affords the borrowers with higher loan amounts and lower interest rates. However, there’s also the risk of losing a valuable asset if, for some reason, you cannot fulfill the loan repayments.
Aside from collateral, most business loans may also oblige you to sign a personal guarantee agreement. A personal guarantee is a person’s legal promise to repay the loan using their personal assets if the business becomes unable to. This provides the lenders with assurance that they will be able to recoup their losses in the event of a default.
3. Know Your Loan Options
One thing to know about being a startup is that your loan options will most likely be limited. Since you haven’t established a solid financial and credit track record, lenders would be less willing to extend credit to you.
But that doesn’t mean that you won’t be able to find a great financing solution for your business. Here’s a breakdown of each of the financing options you might be able to qualify for:
a. Business Lines of Credit
If you’re looking for a financing solution that will help you cover almost any business expense, a business line of credit would be an excellent choice. With one, you can draw cash whenever the need arises and only pay back the amount you owe, plus interest. The best part about lines of credit is, you can repeatedly draw money from your credit line as long as you don’t exceed the preestablished credit limit.
The proceeds from your credit line can be used for a variety of purposes, including:
- Additional working capital
- Buying additional inventory
- Equipment acquisition
- Purchasing office supplies and fixtures
- Cover payroll
- Creating a safety net in case of emergencies
Lines of credit can be secured and unsecured. Secured business lines of credit or those that require collateral may afford you a higher credit limit. The terms for an unsecured line of credit, however, may not be as flexible.
b. Business Credit Cards
Business credit cards work similar to that of a business line of credit, and it can be utilized for the same purposes (additional working capital, equipment, inventory, or office supplies). They’re also a revolving credit, which means that you can tap into the funds, pay what you owe, then reuse the funds again if the need arises.
Business credit cards are usually the go-to financial resource of many startups. It’s the easiest to qualify for because most of the time, lenders only look at the business owner’s personal credit score to determine their qualification. Even if they don’t have a good credit score, it won’t be hard to find a provider that would still be willing to work with them. Business owners may just have to commit to paying high fees to offset the risk the lenders are facing.
Furthermore, many credit card companies offer 0% introductory APR. This basically means that you won’t have to pay any interest on the funds you use within a specified time. However, you have to make sure that you pay off your credit before the date the APR is set to increase.
With a business credit card, most lenders won’t require collateral but may require a down payment. They may also ask the business owners to sign a personal guarantee agreement.
c. SBA Microloans
SBA microloans are one of the best startup loans available to small business owners. It offers low-interest short-term loans to help businesses establish and expand. With one, eligible borrowers can get as much as $50,000 to jumpstart their business.
Although SBA Microloans are designed specifically to help underserved businesses (i.e., women-, veteran-, or minority-owned companies), startups can qualify for it, too. SBA microlenders (usually non-profits) don’t require excellent credit. In fact, it’s common to find a lender that would be willing to work with borrowers with a credit score as low as 575.
However, they would have to demonstrate strength in other areas of the loan application to make up for the low credit score. For instance, they would need to pledge valuable collateral or present a solid business plan. You’ll also have to demonstrate your ability to repay the loan through your financial projections to improve your chances of approval.
Moreover, you’d also need to demonstrate that you can’t qualify for the same credit amount and terms from other lenders. SBA microloans are usually the last-resort financing options for small business owners.
SBA microloans can have a 6-year repayment period with an interest rate hovering between 8% to 13%, depending on the lender and your qualifications.
4. Find the Right Lender
Though banks offer the best loan terms and rates, qualifying for a traditional bank loan could be nearly impossible for new businesses. The majority of banks may require firms to have at least two years of business history, substantial revenue, and excellent credit background. And, because startups are risky by nature, the risk-averse banks may not be willing to extend credit to them.
This leaves businesses with two choices: Alternative Lenders and Non-Profit Microlenders.
a. Alternative or FinTech Lenders
If you’re looking for the best source of funding for your new business, applying for financing from alternative lenders is your best bet. These lenders are more open to taking risks and are, therefore, more likely to work with businesses that haven’t been able to establish their financial and credit background yet.
With online lenders, businesses can get between $1,000 to $5 million in funding. While online lenders charge higher APRs than traditional lenders, approval rates are higher for these lenders, and funding can occur as fast as 24 hours after approval. This makes them a perfect choice for businesses looking for a quicker way to access financing.
b. Non-profit microlenders
Non-profit microlenders are a great funding source for new businesses that can’t meet the qualification for traditional business loans. In essence, microlenders offer short-term business financing. Once approved, they can provide a maximum of $50,000 in funding to small, startups businesses.
However, the application process can be a lengthy one compared to alternative lenders. That is because microlenders usually require applicants to present financial details, a detailed business plan, and a description of what the loan will be used for. Their interest rates might also be higher than that of a conventional business loan but lower than alternative lenders. In general, they charge between 6% to 30% APR.
Although the process of applying from a microlender may be extensive, they can be a better choice for businesses that can’t qualify for a traditional bank loan or those who are looking for a smaller capital boost.
5. Collect the Documents and Fill Out Paperwork
Once you have picked the right loan and decided on a lender, the next step is to find out what documents they’ll need. As outlined above, the lenders will require you to submit financial statements, tax returns, business plans, and more. Locating these files now will help streamline the loan application process.
Don’t forget to fill out the paperwork you need beforehand. Some of the fields in the application forms may require you to consult with a business attorney or accountant, so be sure to do that to avoid mistakes that could affect your application.
6. Submit Your Application and Wait for Approval
After getting everything ready, it’s time to submit your application. Some lenders may offer online applications (i.e., online lenders). If that’s the case, you will need to convert your documents into soft copies and upload the files on the lender’s database along with your application form.
Other lenders may require you to visit one of their branches personally to submit your application. As you submit your application, the lenders may conduct a short interview and ask you questions like how you’ll use the funds or repay the loan. One thing to remember in these situations is to be transparent and honest as possible. If the lenders find out that you’re providing false information, it will hurt your chances of approval.
Once everything has been submitted, the only thing left to do is wait for the lender’s decision. For online lenders, approval can take as fast as one business day. For non-profit lenders, approval could take a few weeks, so best apply for it if time is on your side.
Get the Funds You Need to Start a Business Today!
Starting a business can be the most exciting but overwhelming experience of your life. But to keep it open, you need to be able to secure enough funding. Business loans are a great financial resource, and while navigating the entire application process could be daunting, there are many resources that can help make the whole thing easier.
Use the guide above as your starting point. Once you get a grip on how business loan application works, it will be easier for you to get the funding you need to see your business succeed. Good luck!