May eNewsletter

• Oklahoma Aerospace Summit and Expo
• Business Solutions Series: Learning to Fly: Connecting to Oklahoma's Growing Aerospace Industry
• Survey Finds Long-Term Optimism Among World's Small Businesses
• Why Small Businesses Fail
• In Advertising, Consistency Pays Off
• Strategies: Which Social Networking Site is Best For Your Small Business?
• Market News

Oklahoma Aerospace Summit & Expo On June 15-18, 2009 the Oklahoma Aerospace Alliance will present the 8th annual Oklahoma Aerospace Summit & Expo in Tulsa, Oklahoma. In addition, the Summit will once again host the Aerospace Education and Training Day, which will be held June 18, 2009, at the Tulsa Technology Center-Riverside Campus.

The mission of the Oklahoma Aerospace Summit & Expo is to provide a venue for Oklahoma's aerospace industry leaders, government officials, and non-aerospace companies to network and to attend sessions designed to help companies achieve success in today's economy.

This year's Summit 2009 agenda includes speakers who will address today's challenges and opportunities and "how-to sessions" targeting skills, tools and resources that Oklahoma's aerospace companies need to advance their businesses.

The Summit Expo will serve as an opportunity for aerospace companies, education and training organizations, and non-aerospace companies who want to do business with Oklahoma's aerospace industry to showcase products, services, & capabilities.

An agenda that boasts outcome-based sessions, leading industry presenters, an opportunity to participate in Industry Matchmaking sessions, and over 100 exhibitors you won't want to miss this opportunity to attend and participate in Summit 2009!

Click here to Register.

Learning to Fly: Connecting to Oklahoma's Growing Aerospace Industry
You are cordially invited to participate in this very special event designed to awaken the small business community of Oklahoma in securing the knowledge and tools to plug into a globally competitive and vibrant aerospace industry. Please join us to network with other small business leaders and participate in an open discussion about the potential to grow one of Oklahoma's biggest industries. Learn how your business can become a valuable partner in the aerospace industry.

The SpiritBank Business Resource Center Business Solutions Series presents Learning to Fly: Connecting to Oklahoma's Growing Aerospace Industry. Featuring Mary Smith, Director of Aerospace SpiritBank and Director of Oklahoma Aerospace Alliance.

This interactive session will give attendees: 

• A greater understanding of the impact of the aerospace industry in Oklahoma
• Ways to plug into aerospace companies
• A new perspective on our changing state
• Ways to meet the challenges of the global economy

Join us in Oklahoma City:
Tuesday, June 2, 2009
5:30 - 7:00 p.m.
Oklahoma Heritage Museum
1400 Classen Drive, Oklahoma City

Join us for networking, wine and hors d'oeuvres prior to the event.
Seating is limited for this no-cost seminar, RSVP to Shauna George at (405) 463-5011 or sgeorge@spiritbank.com.

Join us in Tulsa:
Thursday, June 4, 2009
SpiritBank Community Room
1800 South Baltimore Avenue, Tulsa
Networking 4:30pm – 5:00pm
Learning to Fly Program – 5:00pm – 6:00pm
Penthouse Reception - 6:00pm - 7:00 pm

Seating is limited for this no-cost event. Sign up early by contacting Justin Swearengin at jswearengin@spiritbank.com or 295-7470.

Survey Finds Long-Term Optimism Among World's Small Businesses
By Mark Harden

Small-business leaders worldwide remain optimistic about their long-term prospects despite the economic downturn, even though only 37 percent expect their companies to do better this year than last, according to a survey released Monday and sponsored by Colorado's Verio Inc.

The survey, conducted in April, is by the Economist Intelligence Unit, the business-information arm of the Economist Group, publisher of the Economist. It surveyed 328 owners and executives of small- and mid-sized businesses around the world, with 29 percent of the respondents from North America.

According to the survey, 83 percent of small business executives are optimistic about their company's long-term ability to rebound when the economy improves, 65 percent expect their company's market share to have increased by the time the recession ends, and 73 percent expect revenues to have increased.

Only 6 percent of the worldwide executives surveyed said they expect the quality of talent in their organizations to decrease once the economy improves; 38 percent expect it to increase.

Yet many of the business leaders surveyed say their governments are doing too little to support them through the worldwide downturn.

Forty-eight percent of those surveyed said local government is unsupportive of their business, and 39 percent say the same of national governments.

Asked to explain this lack of government support, small-business executives worldwide said smaller companies "do not attract enough attention" (39 percent), "the public at large perceives large companies as more important than small- and mid-size companies" (28 percent), and "small- and mid-size businesses have fewer advocates than large companies" (24 percent).

Read this article online.

Why Small Businesses Fail
By Jay Goltz, Fortune Small Business

The clues are usually there - if you know what to look for.

Last month I wrote about Debbie Dusenberry, owner of Curious Sofa, a home-furnishings boutique in Kansas City, Kans. The store has a reputation for great products and imaginative display, and its revenue had been growing nicely for eight years.

But when Dusenberry sent me her financials, she included this plaintive note: "Our January was down 20 percent, and for the first time I am a little worried....If I had any reserve, I wouldn't be nearly as concerned....[We're] cutting back anywhere we can by freezing spending, and I laid off my first employee in eight years."

Dusenberry's financials explained clearly why her business has potential - and why she's in trouble. The store's annual revenue has grown to more than $800,000. Her labor costs as a percentage of revenue are a little high, and she probably needs to lay off another employee. The rent isn't terrible, although I think she can get her landlord, who clearly doesn't want to lose a tenant in this economy, to cut her a break. But here's the thing: Her statements show that she's lost money eight years in a row.

Every year, Dusenberry said, she told herself that she was going to work harder and sell more stuff, but working harder doesn't fix a broken business model. It just prolongs the agony. This kind of delusional thinking, I believe, explains why some 70 percent of small businesses go broke before their 10th anniversary, according to the Small Business Administration.

Entrepreneurs tend to concentrate on what they love, whether it's the artist who paints but doesn't spend any time marketing or the chef who lives in the kitchen and ignores her financials. Every business owner needs to be his or her own CFO. Delegating that task to a bookkeeper or an outside accounting firm means putting your life into their hands. They generally don't know the ins and outs of your business well enough to make critical decisions.

Dusenberry's accountant told her to cut expenses, which is fine but insufficient. The truth is that she's on the road to insolvency and her only hope is to come up with a 2009 budget that shows a profit. She has no more credit and must pay down some of her loans. The obvious question, of course, is how she's going to turn a profit if she can't cut more expenses. It won't help to sell more stuff because her cost of goods sold is too high.

Believe it or not, Dusenberry needs to raise her prices. Yes, even in this economy. If that sounds ridiculous, you need to do the math. Here's a simplified example: Let's say Dusenberry has been buying sofas for $1,000 and selling them for $2,000. If she sells 10, her sales are $20,000 and her cost of goods sold is $10,000, leaving her a gross profit of $10,000.

Now suppose she raises the price to $2,200. That's a 10 percent hike, but let's also assume that the price increase means she sells 20 percent fewer sofas, or a total of eight. This takes her sales to $17,600, her cost of goods sold to $8,000 and her gross profit to $9,600. While it looks as if she's falling short, she's actually going to come out about even in this scenario because she'll save some variable costs - delivery, credit-card fees and freight - by selling two fewer sofas.

But here's my real argument: Dusenberry runs a niche business with a loyal following. Her customers aren't going to revolt if she starts charging market prices. I think she'll sell nine sofas at the new price, making her profitable.

Could I be wrong? Sure. But the laws of price elasticity suggest otherwise. And if Dusenberry keeps doing things the way she's been doing them, she'll go out of business anyway. At least the price adjustment gives her a shot.

Read this article on CNNMoney.com.

In Advertising, Consistency Pays Off
By Steve McKee

Your ability to sustain a long-term advertising program shows customers that you're a successful, reliable brand.

I recently purchased a new digital TV. Normally, Circuit City (CC) would have been on my list as one store in which to shop, but the struggles the company was facing (followed by its decision to declare bankruptcy) made me nervous.

I was sure I could somehow get my TV serviced under the manufacturer's warranty if something were to go wrong, but I figured it would be more of a hassle if the retailer from whom I purchased the TV wasn't there to back me up. So I went elsewhere.

This principle, which I call "the fear of warranty," is one of the reasons why GM (GM) is doing everything it can to avoid the bankruptcy process. People tend to feel less comfortable doing business with companies they perceive are on the ropes.

But I submit that the principle holds true at the other end of the spectrum as well. Brands that are setting the world on fire make people feel more confident about (and perhaps even more intelligent for) doing business with them. And one very visible signal a brand can send about its momentum is how consistently it advertises.

RIDING THE VICTORY TRAIN
You probably have at least a vague familiarity with the names Michael Beschloss and Doris Kearns Goodwin. They're the Presidential historians who always seem to be called upon by the television networks to provide expert commentary during campaign seasons. They really seem to know their stuff.

Of course, you and I can't say with certainty whether or not they are the most qualified historians to comment on Presidential elections. Oh, sure, they are intelligent, studied academics who provide interesting insights. But there are probably many other capable people who could do the same.

What makes us believe that Beschloss and Goodwin are the leading experts is the fact that they are visibly and consistently out there, presumably because they've been vetted by people who should know. The fact that we see them on TV all the time is, in and of itself, proof of their leading expertise. Simply put, their visibility leads to credibility.

The same thing is true with products and services we see advertised day after day. The more visible a brand is, the more opportunities it earns to build trust with its customers and prospects.

Consider some of today's most successful products and services. Without each of us personally spending a great deal of time and effort researching, testing and comparing competitive alternatives, we don't really know whether Nike (NKE) makes a better shoe, Michelin (MICP.PA) manufactures a better tire, or Verizon(VZ) has created a better network. Instead, we entrust at least some of our judgment to the momentum these brands appear to have in the marketplace.

In some respects it doesn't even matter what their ads say; the simple fact that each of these brands is actively and consistently "in the game" speaks volumes—especially in challenging economic times—and generates genuine momentum for their brands.

THE WISDOM OF CROWDS
In his book, The Wisdom of Crowds, James Surowiecki makes the case that "together all of us know more than any one of us does." He says, "Markets are made up of diverse people with different levels of information and intelligence, and yet when you put all those people together and they start buying and selling, they come up with generally intelligent decisions."

In the world of advertising, consistency is like a scorecard on the wisdom of crowds. People know that advertising is expensive, so the more a company advertises, the more successful it must be. And the more successful it is, the more it means that other people are choosing it. Which means that it may be a good idea for you and I to choose it as well.

Your brand can benefit from this power of positive momentum. Through your initial advertising efforts, people will learn that you exist. With repeated exposure, they'll learn that you're stable. With even more repeated exposure, they'll assume you're successful—after all, based on your ability to sustain a long-term advertising program, you'd have to be.

The specific content of your ads is, of course, of vital importance as well—Beschloss and Goodwin wouldn't last long if they were misleading, annoying, or ignorant. But what's true of your career, of sports, and of life in general is also true of advertising: never underestimate the power of simply showing up.

Read this article on BusinessWeek.com.

Strategies: Which Social Networking Site is Best For Your Small Business?
By Rhonda Abrams

In the olden days – say five years ago – it was enough for a small business to market its services with advertising and public relations.

But in the last few years, an avalanche of new opportunities has cascaded on the Internet in the form of social networking sites.

These sites give entrepreneurs more opportunities to get the word out about their companies, but they've also made many of us feel overwhelmed, trying to keep up. What's a small business person to do? Do you really have to be Tweeting all day?

For the uninitiated or under-initiated, I'm here to help. First, recognize the advantages and limitations of social networking sites.

Advantages:

• Connect with lots of new people, just as with real-life networking.
• Get the word out without an intermediary, such as a pesky reporter or columnist!
• Establish yourself as an expert in a field.
• Stay on top of your field and your competitors.
• Connect with your own customers.

• Can consume a huge amount of time.
• Most connections will never convert to paying clients or customers.
• A zillion of your competitors are out there.