Costs of Implementing an ERP System

Costs of ERP Implementation
Costs of ERP Implementation

Costs of Implementing an ERP System

What to Expect When Implementing an ERP System

Enterprise Resource Planning (ERP) systems are powerful tools that streamline business operations by integrating various functions like finance, inventory, and human resources into one cohesive platform. While the benefits of an ERP system are undeniable, it’s important for businesses to consider the costs involved in implementing one.

  1. Software Costs: The most obvious expense is the software itself. ERP solutions vary greatly depending on the complexity and the size of your business. Prices can range from a few thousand dollars for basic systems to hundreds of thousands for large-scale, enterprise-level solutions.
  2. Customization and Integration: Most businesses need some level of customization to tailor the ERP system to their unique needs. This can include integrating the system with existing software tools, databases, or third-party applications. Customization and integration costs can add up quickly, depending on the complexity of your business operations.
  3. Training: Employees need to be trained to use the new ERP system efficiently. Training costs can be substantial, particularly for large teams or complex systems. Factor in both the cost of training materials and the time spent away from regular duties to learn the system.
  4. Implementation and Consulting Fees: ERP implementation often requires external consultants or specialists to ensure the system is set up properly and the business processes are aligned. These fees can range from a few thousand to tens of thousands of dollars depending on the project scope.
  5. Ongoing Maintenance and Support: Once the ERP system is up and running, ongoing support and maintenance are necessary to keep the system updated, secure, and functioning smoothly. Many ERP vendors charge a recurring annual fee for this service.
  6. Hidden Costs: It’s easy to overlook hidden costs such as data migration, system downtime during implementation, and potential disruptions to daily operations. These indirect costs can affect productivity and should be accounted for in your budget.

While ERP systems offer long-term benefits in terms of efficiency and scalability, their initial implementation costs can be significant. It’s crucial to carefully plan and budget for both the direct and indirect expenses to ensure a successful deployment.

Financing for ERP System Implementation

Given the large upfront costs of purchasing and implementing ERP systems, financing could be appropriate. Both the software and the implementation costs can be financed for up to 60 months turning the upfront costs into fixed, monthly payments.

Contact Dimension Funding for more information.

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Upgrade Brewery Equipment On a Budget

Upgrade your brewery equipment on a budget
Upgrade your brewery equipment on a budget

Upgrade Brewery Equipment On a Budget

How Financing Can Help You Upgrade Your Brewery Equipment on a Budget

Upgrading your brewery equipment is a crucial step in ensuring the quality, efficiency, and capacity of your brewing operations. However, the cost of new equipment can be a significant barrier, especially for smaller or growing breweries. This is where financing can play a pivotal role in making upgrades possible without draining your budget.

  1. Preserving Cash Flow

Upgrading equipment is essential, but paying for it upfront can strain your cash flow. Financing allows you to spread the cost of new equipment over a set period, which means you can invest in the tools you need without draining working capital. This way, you can continue brewing, marketing, and selling without disruption while managing payments in a predictable manner.

  1. Access to Modern Equipment

Breweries are constantly evolving, and so is the technology that powers them. Financing enables you to upgrade to the latest brewing equipment, which can boost your production capacity, efficiency, and consistency. Whether it’s a more energy-efficient boiler, a state-of-the-art fermenter, or advanced filtration systems, financing helps you keep pace with industry innovations while staying within your budget.

  1. Avoiding Downtime

Old or outdated equipment can lead to frequent breakdowns, leading to production downtime and delays. With financing, you can replace equipment that’s no longer reliable with new machines that improve efficiency and reduce maintenance costs. By upgrading on a budget, you ensure that your brewery runs smoothly and stays ahead of potential disruptions.

  1. Improved Efficiency and Profitability

Upgraded equipment often leads to better efficiency. For instance, new automated systems or faster brewing technology can increase your production volume, reduce waste, and improve product quality. Financing lets you access these benefits sooner rather than later, helping you increase your output and profitability without waiting years to save enough capital.

  1. Flexible Payment Options

When financing your brewery equipment, you have a variety of payment options to choose from. Depending on your cash flow and financial situation, you can select a payment plan that works best for you, whether it’s low monthly payments, seasonal terms, or even deferred payments. This flexibility ensures that you don’t have to compromise on the equipment you need to grow your business.

  1. Scaling Your Brewery Without Overstretching

With financing, you don’t need to wait until your brewery can fully afford an equipment upgrade. This enables you to scale up production to meet growing demand, expand your product offerings, and improve efficiency without compromising your budget. Financing allows you to grow strategically and responsibly.

Conclusion

Financing is an effective solution for upgrading your brewery equipment without straining your finances. It offers flexibility, preserves cash flow, and ensures that you can invest in modern, efficient equipment that keeps your brewery competitive. By financing your upgrades, you can enhance production, reduce downtime, and ultimately grow your business on your terms.

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The High Cost of Implementing an ERP System and How Financing Can Help

The High Cost of Implementing an ERP System and How Financing Can Help

Implementing an Enterprise Resource Planning (ERP) system, such as SageIntacct, NetSuite or ODOO, can be a game-changer for businesses looking to streamline operations and enhance efficiency. However, the cost of implementing an ERP system can be substantial, often running into tens or even hundreds of thousands of dollars. This investment includes not only the software and hardware but also costs for customization, training, and ongoing support.

For many businesses, especially small and mid-sized enterprises, these upfront costs can be a major barrier to adopting an ERP system. Fortunately, there are financing options available that can help spread the expense over time. With financing plans offering terms of up to 60 months, companies can manage the financial strain of implementation by paying in affordable monthly installments.

By securing financing for ERP implementation, businesses can balance their budget while still gaining access to the powerful tools that drive long-term growth and efficiency. Whether through loans, leases, or vendor-financed programs, breaking down the cost into manageable payments ensures that the benefits of an ERP system are accessible without compromising cash flow.

With the right financing plan, companies can embark on their ERP journey without the burden of upfront costs, making it easier to stay competitive and position themselves for success.

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Hidden Costs of Not Financing your Legal Practice Management Software

legal practice management software financing
legal practice management software financing

Hidden Costs of Not Financing your Legal Practice Management Software

In today’s competitive legal landscape, investing in legal practice management software is no longer a luxury—it’s a necessity. From streamlining operations to improving client service, the benefits are undeniable. However, many law firms hesitate due to the upfront costs associated with acquiring such software, including hefty subscription fees, implementation, and training expenses.

The true cost of forgoing financing for legal practice management software often goes beyond just these immediate expenditures. By choosing not to finance, firms may feel the financial strain of large one-time payments, disrupting cash flow and hindering other investments. But what if you could spread out those costs into manageable monthly payments?

Benefits of Financing your Law Firm's Practice Management Software

Financing your law firm’s legal practice management software allows you to break down the substantial upfront costs into predictable monthly payments, aligning with your firm’s budget and cash flow. Instead of facing the burden of paying large sums all at once for both the subscription and necessary implementation and training, financing allows you to pay over time. This not only makes the software more affordable but also ensures your firm has the resources it needs for other important areas of the business.

Moreover, financing gives your firm the flexibility to access premium software features that might otherwise be out of reach due to cost barriers. With a tailored financing plan, you can focus on the long-term benefits of improved operations without sacrificing your financial stability in the short term.

In conclusion, while the upfront costs of legal practice management software may seem daunting, financing can turn this challenge into an opportunity. By spreading the payments over time, law firms can access top-tier technology without the financial strain of large initial investments, making the software a smart, sustainable choice for growing practices.

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Role of Winery Equipment Financing in Sustainable Practices

Financing Winery Equipment and it's Impact on Sustainable Practices
Financing Winery Equipment and it's Impact on Sustainable Practices

Role of Winery Equipment Financing in Sustainable Practices

Sustainability is a growing priority in the wine industry, with more wineries seeking ways to reduce their environmental impact while maintaining profitability. As a result, wineries are increasingly looking to upgrade to more efficient, eco-friendly equipment. However, the upfront costs of these modern, sustainable tools can be a significant barrier. This is where winery equipment financing becomes a crucial player, allowing wineries to adopt green practices without sacrificing their cash flow or financial stability.

Financing Green Equipment for Eco-Friendly Operations

Winery equipment financing helps wineries invest in environmentally friendly technologies that can lower energy consumption, reduce waste, and minimize their carbon footprint. Some key sustainable equipment types that can be financed include:

  • Solar-powered systems: Solar energy is increasingly used to power various winery processes, from bottling to temperature regulation in fermentation rooms. Financing options help wineries invest in solar panels and battery storage systems without incurring large upfront costs.
  • Energy-efficient crushing and pressing machines: Modern crushers and presses are designed to use less energy while maximizing juice extraction, which reduces both energy consumption and material waste.
  • Water-efficient irrigation systems and filtration: Water conservation is critical in winemaking. Financing can help wineries install efficient drip irrigation or water recovery systems that reduce water usage while maintaining grapevine health.
  • Automated fermentation control systems: These advanced systems help regulate temperature and humidity levels more precisely, reducing the need for excessive cooling or heating, and contributing to lower energy consumption.

By using financing to acquire these eco-friendly technologies, wineries can align their production practices with sustainability goals without waiting until they have accumulated enough capital.

Enhancing Waste Reduction Through Financing

Another major aspect of sustainable winemaking is reducing waste, particularly the organic waste generated during production. Modern equipment that can be financed includes:

  • Waste recycling systems: Equipment that processes organic waste like grape pomace and stems into compost, biofuel, or other reusable products.
  • Bottling and packaging equipment: New bottling machines that reduce packaging waste, use lightweight materials, or incorporate recycled materials can contribute to more sustainable packaging solutions.

These types of equipment are often expensive, but financing allows wineries to implement these technologies sooner, contributing to waste reduction goals and enhancing their sustainability initiatives.

Financing to Support Organic and Biodynamic Practices

Wineries that practice organic or biodynamic farming methods may require specialized equipment for their vineyards. Financing options make it easier for these wineries to access tools that align with these practices. For example:

  • Composters and organic fertilizers: Wineries using organic methods need machinery for composting organic waste or applying natural fertilizers efficiently.
  • Specialized tractors and sprayers: These machines are designed to be more precise, applying fewer chemicals and reducing environmental harm. They can be particularly useful for wineries practicing biodynamic or organic farming methods.

By financing such equipment, wineries are able to invest in sustainable farming practices that improve soil health, reduce pesticide use, and promote biodiversity.

Overcoming Financial Barriers to Sustainability

The primary hurdle to adopting sustainable practices is often the initial cost. Winery equipment financing provides a pathway to overcome these barriers. Instead of delaying investment in equipment that could significantly enhance sustainability efforts, wineries can:

  • Spread out payments over time: Financing enables wineries to manage their cash flow while still adopting the technologies needed for a greener operation.
  • Invest in upgrades without financial strain: Wineries can keep their operations running smoothly while making necessary upgrades to meet sustainability goals.

Winery equipment financing plays a crucial role in enabling wineries to integrate sustainable practices into their operations without compromising financial stability. By financing energy-efficient, waste-reducing, and eco-friendly equipment, wineries can reduce their environmental footprint, improve operational efficiency, and align with consumer demand for sustainable products. As the wine industry continues to prioritize sustainability, financing will remain an essential tool for wineries to adopt the technologies needed to stay competitive, environmentally responsible, and financially healthy.

If you want to take advantage of the power of financing winery equipment, Dimension Funding is your one stop source for financing. We are able to combine multiple different types of equipment on one financing agreement which will allow you to get the equipment you need all while making one monthly payment.

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Benefits of Food Truck Ownership

Food Truck Ownership Benefits
Food Truck Ownership Benefits

Benefits of Food Truck Ownership

Owning a food truck can be an incredibly rewarding and diverse venture. Not only does it allow you to run your own business, but it also lets you craft unique culinary experiences for your customers. Gone are the days when food trucks were merely considered greasy spoons; today, many food trucks offer gourmet dining experiences. As a chef and culinary artist, you have the opportunity to create dishes that keep customers eagerly anticipating your arrival. Moreover, food trucks are frequently hired for major events, such as wedding receptions, parties, and other gatherings.

Financing the Purchase of a Food Truck

Typically, to secure financing for a food truck purchase, you need to have been in business for at least two years. However, if you have a steady income stream from a related culinary business, you may still qualify for financing to start your food truck venture. Additionally, having good credit is crucial, especially if your business is less than two years old.

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Bonus Depreciation is About to Phase Down to 80% in 2023

Bonus Depreciation is About to Phase Down to 80% in 2023

In 2022, IRS Section 179 has a deduction limit of $1,080,00 for equipment and off-the-shelf software, with a spending cap of $2,700,000. After the spending cap of $2,700,000, a purchaser can take Bonus Depreciation of 100%. Starting in 2023, Bonus Depreciation will be reduced from 100% of the purchase price in the first year to 80% of the purchase price. Each year after that, Bonus Depreciation will be reduced by 20% until it reaches $0.

In 2023, the IRS Section 179 deduction limit will be $1,160,000 and the spending cap will be $2,890,000. Any Bonus Depreciation taken after the spending cap of $2,890,000 will only be 80% instead of the 100% allowed in 2022.

2022 is the last year to get the 100% Bonus Depreciation. If you want to purchase equipment or expensive software, such as ERP, CRM or HR software by the end of 2022 to take advantage of Bonus Depreciation, and don’t have the cash flow, financing from Dimension Funding can make it happen. It’ll be tight but it’s doable. Fill out our online application and one of our financing gurus will reach out to you.

Have a wonderful holiday season!

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Tax Benefits of Buying Equipment & Software Before December 31, 2022

Tax Benefits of Purchasing Equipment Before the End of 2022
Tax Benefits of Purchasing Equipment Before the End of 2022

Tax Benefits of Buying Equipment & Software Before December 31, 2022

It’s almost the end of the year 2022 and the start of a new year.  Your company will want to take stock of potential tax write-offs available to your company before the year ends. One of those tax write-offs is under IRS Section 179 which allows you to write-off up to $1,080,000 for equipment or software and thereby reduce your tax liability.

It’s an opportunity to reduce your taxes while getting essential equipment for your business. You can start the new year by upgrading your business assets or expanding to increase your business while reducing your overall tax liability for 2022.

Check with your accountant or tax professional to see what tax write-offs are available to you. Depending upon your top tax bracket, you could write off a substantial portion of the purchase price of new equipment or software.

Section 179 Tax Write-Offs

The tax write-off under IRS Section 179 applies to most types of business software and equipment including:

This list is not exhaustive. Pretty much any business asset is covered under IRS Section 179. There are some exceptions of course but IRS Section 179 is pretty expansive. This tax benefit was designed to help small and medium-sized businesses to invest in themselves and to succeed.

Take advantage of it before December 31, 2022 if you want the tax benefits.

If you don’t want to impact your cash flow, you can finance the software or equipment purchase with a financing company such as Dimension Funding. You make monthly payments over the lifetime of the asset, generally up to 60 months. As an added bonus, you may qualify for a 90 days deferment before you have to make your first monthly payment. Your new equipment can be earning you money for 90 days before you make your first monthly payment. With the tax write-off, it might be a good idea to purchase any needed business equipment or software before January 1, 2023.

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How the Inflation Reduction Act Impacts your Business and You and your Family

Inflation Reduction Act
Inflation Reduction Act

How the Inflation Reduction Act Impacts your Business and You and your Family

You may be wondering how the Inflation Reduction Act (IRA) is going to impact you and your business. Are the tax provisions going to impact your business? What provisions are available to benefit your business or you personally?

The Minimum 15% Tax on Businesses

You’ve heard that there is a minimum 15% business tax for companies that pay little or no taxes. However, it only impacts behemoths like Amazon, Nike, FedEx, HP and Salesforce. Small- or medium-sized businesses are not affected. 

ACA Subsidies Extended

The extension of ACA healthcare subsidies until 2025 will help in that the employees of small businesses will be able to afford health insurance. For many small businesses, providing health insurance to its employees is a major expense. Having ACA subsidies means that your employees can get health insurance even if you aren’t able to offer it.

The Inflation Reduction Act’s Impact on Homeowners

A major part of the IRA is moving to clean energy sources and using less energy to provide the same benefits.

Renewal Energy for Homes

Renewal Energy is a big one with a big impact on clean energy producers and green home remodeling companies. Consumers can get the following rebates starting this year:

  • Up to $1,750 for a heat pump water heater
  • $8,000 for a heat pump for space heating or cooling
  • $840 for an electric stove or an electric heat pump clothes dryer
  • $4,000 for a breaker box upgrade
  • $1,600 for insulation, air sealing and ventilation
  • $2,500 for electric wiring

Green remodeling will jump from a one-time $500 tax credit to an annual $1,200 / year. Many homeowners who previously couldn’t afford to “green” their home energy production will be incentivized to do so. Companies who offer these “green” services will see demand skyrocket with these incentives offered for the next 10 years. Not only will this reduce our carbon footprint, but it will reduce costs on the average household by $170 to $220 a year in electricity costs.

Tax Credits for Solar Panels

Homeowners can combine the tax credit of up to 30% for solar panels with battery systems that allow homeowners to store excess energy. This tax break for batteries starts in 2023.

Rebates for Reducing Home Energy Usage

Homeowners could get up to 50% of the cost of efficiency retrofits such as insulation and HVAC installations up to a dollar cap of up to $8,000.

Tax Credits for Electric Vehicles

The Inflation Reduction Act’s vehicle tax credits for new ($7,500) or used ($4,000) EVs is aimed at low and middle income buyers and excludes luxury EVs that sell for more than $55k or a truck or SUV that sells for more than $80k. This is a mixed bag since the downside is that the critical minerals needed to make EV batteries must come from North America or our free trade partners which eliminates quite a few EVs. However, there are still quite a few EVs left that can be purchased.

Also, there are income requirements for the $4,000 tax credits for used EVs. If you are single, your AGI can’t exceed $75,000; a married couple’s AGI can’t exceed $150,000 to get the tax credit for used EVs.

Medicare Negotiation

The IRA also allows Medicare to negotiate drug prices. That will bring down costs of many drugs. In particular, the cost of insulin will be capped at $35 / month starting next year. It will also cap the total amount that people on Medicare pay for prescriptions to $2,000 per year.  If you are on Medicare, this could mean big savings for you.

The Inflation Reduction Act’s Impact on your Business

Electric Vehicles for your Business

With incentives to purchase EVs it might make sense as a business to invest in EVs rather than gas-powered vehicles. There are commercial energy tax credits available in the Inflation Reduction Act for many small businesses.

R&D Tax Credit

The IRA also doubles the maximum R&D Tax Credit that can be applied against payroll taxes. It is up to $500k from $250k. The concept of R&D is a very loose one and you could qualify. Check with your accountant or tax attorney.

Creation of Businesses

According to the head of investment at Bill Gates’ Breakthrough Energy Ventures, between 300 and 1,000 new companies might be created om the climate space. Depending upon the business you are in, this might provide you with more customers for your products or services. It could also provide you with more energy efficient products in the future.

Conclusion

There is no doubt that this is a transformative bill, particularly in the area of climate change. It is estimated that the IRA could slash US emissions by 41% by 2030. You and your company can take advantage of the IRA’s provisions to move to cleaner and less expensive energy. Since energy costs are large part of inflation, it should also bring down inflation, which will benefit businesses and consumers.  It will reduce our dependence on foreign oil and help to reduce our carbon emissions.

You can make your business more energy efficient. You can also make your home more energy efficient. All with rebates and tax breaks to help you do so. It’s a win win. As always, we are available to finance your eligible business purchases.

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Recession? What Recession?

Visual of Thriving During a Recession
Visual of Thriving During a Recession

Recession? What Recession?

Steps to Prepare your Business for an Economic Downturn

Is there going to be a recession in the next 12 months? Are we in a recession now? Experts offer conflicting views. Fed Chair Jerome Powell says “he doesn’t think the U.S. is currently in a recession. … There are too many areas of the economy that are performing too well.”

Ellen Zentner at Morgan Stanley says, “the probability of a recession in the next 12 months is about 30 percent, according to the bank’s models.” Bank of America and S&P Global Ratings puts the probability of a recession at 40%.

Then there’s the discussion of what constitutes a recession. Experts are divided on this as well. However, as a business, you know when your business earnings start to drop. No matter how an economic downturn is labeled, if it impacts your bottom line, you need to take action.

Here are some ideas on how prepare for and thrive during an economic recession or downturn:

Have a Financial Plan

Don’t wait until you are in the middle of a recession to put together a plan. Put together a company plan now. It will help with guidance on how to successfully navigate the recession and keep the company from having a knee jerk reaction and possibly costing the company long term.

Emergency Fund

If you are an individual, you are urged by financial gurus to have an emergency fund. It’s good advice for businesses too to have enough working capital on hand to weather any economic downturns. Have enough cash on hand to handle anything that arises during a downturn.

Cut Out Unnecessary Costs / Numbers Don’t Lie

Take a long look at your budget. Are there expenses that aren’t bringing in an ROI or you know just aren’t working. Cut them from your budget. Even small items can add up. Take a look at the corporate credit cards. What expenses can you prune? It’s amazing how many items get paid for and then either never used, or used and then forgotten about.

Cut back on discretionary spending such as travel, high-cost lunches, etc., unless the spending is related to ROI. Obviously, if trade shows bring in business, you would not want to cut back on those. But a lot of your discretionary spending can be pruned.

Don’t preemptively cut staff. In past recessions, companies that reduced their staffs because of a recession took years to come back because of the loss of key company and business knowledge. Instead, use this as an opportunity to update and train your staff. Studies have shown that companies that invested in themselves and their employees recovered quickly after a recession. Also, the pandemic changed employers’ recession strategy. Because so many employees never went back to their pre-pandemic jobs, employers want to hold onto good employees. It’s easier to keep good employees than to find them.

In HBR’s, “Roaring Out of Recession,” companies that had “layoffs may reduce costs quickly, they make recovery more difficult. Companies run the risk of scaling up too late, especially if hiring is more difficult than they anticipated. People are loath to work for organizations that reduce head count in difficult times. Moreover, as these companies rehire, costs shoot up.”

In Roaring Out Recession, it states, “The CEOs of pragmatic companies recognize that cost cutting is necessary to survive a recession, that investment is equally essential to spur growth, and that they must manage both at the same time if their companies are to emerge as post-recession leaders.”

Keep investing in your Business / Prepare for the Bounce Back

Companies that continue to invest in marketing and advertising come back faster from a recession. Recessions are a good time to update your technology, train your staff, etc. Many types of technology, such as ERP Systems, IT Systems, etc., reduce your costs and increase efficiency. By investing in technology before or during a recession, you can use technology to reduce your overall corporate costs.

Finance Large Purchases Over Many Years

Instead of reducing your working capital, finance large purchases for up to 5 years. While recessions can last this long, it’s highly unlikely that any 2022 recession would still be ongoing in 5 years because of the causes of this potential recession and the low unemployment numbers.

Focus on Long Term Goals

Think long term. Knee jerk reactions can cost your business money and personnel in the long run. See past this quarter or even this year. Plan for the future. What you do today can have a big impact for many years to come.

Look for creative ways to increase sales

If your company is hit particularly hard by a recession, look for creative ways to make more money. Tap the resources in your company to possibly expand your product offering or to creatively reposition your products to meet the moment.

Keep in contact with your customers

It’s easy to become cocooned during a recession. Instead, stay in touch with your customers. Maintain good relationships even if they can’t afford to purchase from you at this time. Reach out just to check in. They will remember who stood with them when they were experiencing problems.

Upshot

We are getting plenty of warning of a potentially upcoming recession. It’s really important to take steps now in order to be prepared.

If you are contemplating the purchase of big ticket items and want to save your working capital, we offer equipment financing, technology / IT financing, including software financing. Instead of a large outlay of cash, make fixed monthly payments over the lifetime of the asset up to 60 months. The Fed is likely to raise rates again in September so finance now before rates increase.

If you are an equipment, technology or software vendor, offering financing to your customers can allow them to purchase assets they need for their business while making low monthly payments. You get paid upfront. It reduces the impact of any economic downturn on your business because your customers can afford your products, even during a recession.

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