Today's Quote:
"We don't see things as they are; we see things as we are."
-- Anais Nin, French writer
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In this Issue
Starting a Business in Uncertain Times
By Nancy K. Hyde CPA, CVA, SpiritBank Business Resource Center Strategic Partner
A recession can seem like an unlikely time to start a new business but many find themselves looking for new opportunities due to being downsized or laid off. This can be considered to be a great option even when the economy is depressed. It may be the right time to launch a company.
New Business Offering Necessities
When times are difficult, people look for ways to cut back on luxuries and items they can deem unnecessary. Make sure your business, service or product is one they will find they don't want to do without. Take a look at what people consider indispensable. Read business news reports, talk to others to get a sense of whether the market is good for your product or service. It may be an excellent time to provide services to the health care industry but perhaps not to the struggling auto or new home industry.
Develop a Business Plan Before You Plunge
Many individuals plunge right into their new business without a good idea of the cash needed to start up and maintain the company in the first few months. Prepare a business plan that will consider the market for your product, competition, pricing and financial information. The business plan helps to organize your thinking about a new company. If you are seeking investors or lenders, they will want to know how the business works. Key elements of a good business plan include a description of the business, information on the people in charge, their experience, details about the product or service and detailed financial statements. The financials are crucial to planning for cash flow.
Cash Requirements and Financing
Many individuals underestimate the cash requirements of starting and funding their new business. The business plan will answer the question of how much is anticipated to be needed to purchase equipment, fix up a location and fund necessary expenses until the business can show a profit. Some people use savings or their severance package, others depend upon credit cards. To secure a loan from outsiders or a bank, the business plan will need to show the business will be profitable. Financing your new business with credit cards is extremely expensive and risky.
Seek advice from a professional who can help guide you through this process. CPA's have been trained to provide answers to questions about recordkeeping requirements, government regulations, cash flow, taxes and how to make adjustments needed to help you become a successful business owner.
How To Not Lose Friends and Alienate People
By Jonathan Weber
A boss must communicate carefully in a small business.
Communicating well with your staff is a basic necessity for any boss. And it's especially important in a small company, where relationships tend to be more personal. There's nothing that will alienate employees more quickly than feeling that they're being kept out of the information loop. And nothing engenders more loyalty than making people feel that they're part of an inner circle.
If you own a business with fewer than a dozen employees, as I do, you ideally want that circle to include everyone. And yet there is such a thing as too much information sharing. Major company events such as acquisitions, asset sales, layoffs, and strategy shifts present a lot of delicate issues that you'd do well to think through carefully.
Even if you have a high level of trust in your team, you don't want to find yourself musing too openly about major business decisions. Uncertainty is a condition that most people just don't thrive on, so be careful about signaling upcoming changes before you have a fully baked plan. Employees usually know more than you think about what's going on, so be conscious of what you're communicating in your demeanor. Days of hushed conversations will not go unnoticed.
When you're ready to talk to people about a major development, do it fast: Decide who you might want to tell individually (and if in doubt, tell them individually). Then figure out how to tell them in quick succession, and follow that immediately with a companywide meeting. It's important to respect the proper sequence of information release, but the more compressed it can be, the better.
While your instinct might be to explain all the background behind a major decision or development, be careful about violating others' confidences. I've made this mistake, telling a staff member more than they needed to know about the reasons behind someone's departure, and that person was rightly angry.
Personnel issues are always the most delicate, and the suggestions above apply in spades to layoffs or firings or the hiring of a new person in a sensitive position. In a larger organization, layoffs in particular can be all but impossible to handle gracefully; I've been in the position of having to decide whether to acknowledge what everyone knew-that they were coming-or wait the additional week it would take to figure out exactly who would go.
In a small company, you shouldn't have to deal with that kind of time lag. On the other hand, one piece of conventional wisdom about layoffs-to focus on the feelings of those who are staying, not those who are leaving-is less cut-and-dry. If someone who had been part of the family feels they have been treated unfairly, the fallout can be quite damaging.
As the leader, it's your responsibility to convey confidence and clarity of purpose (even if you don't happen to feel it at the time). I don't deviate very often from staying strong and putting the best face on things even in bad economic times. Yet as long as you don't do it too often, you can gain a lot of credibility by letting your emotions come through sometimes. Tired or worried or frustrated are feelings everyone can respect, as long as you're frugal with them.
In a small company, you don't have a lot of policy and procedure to fall back on. It's all about you, and specifically about what you say and what you do. Be yourself and also choose your words carefully. Those two things can be compatible.
Jonathan Weber is the founder, publisher, and CEO of New West, a media company covering life and business in the Rocky Mountain West.
Read this article on TheBigMoney.com.
Business Owners Must Have a Sales Mindset
By Jerry Carter, CEO Carter & Consultants Hoboken, N.J.
All the operational expertise doesn't mean a thing to a small business owner if there are no customers. Business owners must bring a sales mindset to any new or existing venture if it's going to grow to the next level.
Customers aren't just going to walk through a new business's front door. Cutthroat competition exists in every industry. Word of mouth is great and used by most businesses to at least some extent, but small business owners shouldn't fool themselves that this will drive revenues substantially, especially when a customer base is small.
Business owners don't have to be good in sales to have a sales mindset. The right mindset recognizes the importance of sales and supports it properly through training and materials. Entrepreneurs who lack sales skills need to take sales training classes themselves. After all, employees need to know that it's valued by the company founder. Think about it: Would you buy from or work for a person who isn't able to promote their own business at networking events or on sales calls?
The sales mentality is not just for products. As the leader of a company, it's important to sell the firm to prospective employees, business partners, and even bankers when capital is needed.
If all businesspeople had a sales mindset, they'd all have successful businesses.
Read this article on BusinessWeek.com.
Forget Your Big Idea. Be Simple.
By Lisa Barone
ICanHasCheezburger.com is a site based solely off user-generated content (i.e., content they didn't create) and has achieved 1 Billion page views in its two years of existence. The book based off the concept was an instant New York Times bestseller and the second in the series is due out soon.
Oh, and if you've never seen it, icanhascheezburger.com is a site dedicated to displaying silly cat pictures that users can adorn with even sillier nonsensical captions. Yes, that was someone's BIG dollar idea.
Ben Huh, the guy behind the site, spoke at Search Marketing Expo yesterday and shared with the audience the two reasons why the site is a success.
It's simple.
It makes people happy.
It's genius.
I think a lot of small business owners forget to be simple. They think that in order to compete with the guy down the street that they have to be bigger and more impressive. That to be taken as seriously as the Best Buys or the Staples they need to offer a full line of products and amaze people with their sheer size. Somehow in the business world we've decided that size = credibility and authority. But that's not true.
Your idea doesn't have to be big. It has to be simple.
During yesterday's keynote at SMX, Ben noted some other companies that have leveraged this idea of "simplicity":
Starbucks is the simple place between your home and your office.
Google gave us a simple way to find information.
Facebook make it simple to connect with our friends online.
The Cheezburger network (which ICanHasCheezburger.com is part of) made it simple for people to be happy for a few moments of the day.
That's what people are looking for. The Internet gave us the ability to reach millions in one shot. It changed the way a lot of businesses operated. It dared them to come up with the biggest idea they could and then market it to everyone. That's rarely where success is found.
Instead, find the simplest idea you can and then market it only to those people who would be interested in the service. That's how you find a loyal community, one that will grow and become viral. It's also how you put yourself in the position to be able to make complicated products down the road. Ben asserted in his keynote that the reason Google can stick its hand into everything and release a slew of different products today is because, for awhile, they only did one thing well. They did search. That bought them the freedom to be where they are now.
You're not Google and you don't have to be. Instead of trying to do more than your competitors, figure out how to simplify what their throwing extra steps into. There are a million free services out there - Google Apps, Wordpress, Skype, YouTube - that have made it easier to be "simple" without a lot of overhead. Take advantage and make it simple for people to find happiness. That's what they want. And that's what they want you to give them.
If you want to be better than your competitors, don't figure out how you can one up them and add extra features to their services. Instead, strip them down. Make them easier. That's what we're all looking for. A way to make it easier. Whatever that "it" happens to be.
Editor's correction note: actually it wasn't $1 Billion in revenue as originally noted, but 1 Billion page views and a multi-million dollar business, and the post has been updated accordingly. Still - EXTREMELY impressive for such a simple idea.
Read this article online at SmallBizTrends.com.
Ask an Expert: Time To Get a Recipe for Success
By Steve Strauss for USA TODAY
Q: I hear that half of all small businesses fail. What's the secret, then, to sticking around for the long haul? - Jess
A: Of course there are a lot of things that go into creating a successful business, but one of the most important, and one that is often under the radar, is the need for a great recipe or two.
Huh?
Think about any great recipe that you like. Why do you use it? I bet the reasons are essentially two-fold. First, you like the result, that is, the tasty food. Second, you probably like it because you can count on it - you get the same basic results time and again.
Well, the same should be true in your business. To succeed long-term, you need a success recipe that you can turn to which consistently cooks up new customers.
When I first started my law practice, I tried a lot of ways to generate business, and finally settled on putting on legal seminars for the public every other month or so. I learned that whenever I put on one of these free seminars I would create enough new business to keep me busy for the next few months. After some trial and error, I had figured out a way to make money consistently. I had figured out my recipe for making my "dough" (I know - groan!)
That is what you have to do. Your recipe could be almost anything:
- An ad that consistently pulls
- A sale
- A viable social networking presence
- A weekly e-newsletter
- A killer e-commerce site
The important thing is that you try out various ideas and find one that works, again and again. Creating a great recipe will give you a sense of calm, knowing that you can always count on this recipe to keep you in business.
And then, down the road, if you really want to succeed, what you will do is create yet another great recipe, or two or three, and here is why: When an investor invests in the stock market, he or she knows not to buy only one stock or sector. That sector or stock may go up, but it also may go down. By diversifying their portfolio, investors create a hedge against failure.
Great businesses, large and small, do the same thing. Take Apple for example. No, they are not the biggest computer maker out there, but they are vibrant for many reasons, including the fact that they have created some additional great recipes: Computers begat laptops which begat the iPod, iTunes, and the iPhone (among others.) By creating additional recipes - additional profit centers in music and telecommunications in additional to computers - Apple continues to be a growth leader.
The best small businesses do the same thing. To be a long-term success, you need to add more profit centers. Here's how:
- Make a big list of additional ways to make money or create customers that is a natural outgrowth of what you already do. It should not be too much of a stretch.
- Winnow the list down, and then go over it with some people whose judgment you trust. You are looking for the best two or three ways to create additional revenue.
- Again, it could be almost anything - a new product, a new location, an additional service, whatever.
- Test the ideas out and see which one has the greatest potential.
- Roll it out.
The important thing is that you test and find new profit centers that make you money consistently while reinforcing your brand. Avoid being like those restaurants that advertise "Chinese and American food." Well, which is it? A great recipe makes logical, intuitive sense.
And they should also yield some yummy results.
Click here to see previous columns by Steven Strauss at USA Today. Steven D. Strauss is a lawyer, author and speaker who specializes in small business and entrepreneurship. His latest book is The Small Business Bible. You can sign up for his free newsletter, "Small Business Success Secrets!" at his website -www.mrallbiz.com
Read this article online at USAToday.com.
Getting Bigger On A Budget
Guillermo Rotman, CEO of The Regus Group, has a few words of advice for small companies looking to expand without blowing their budgets.
Growth is good. But only if it doesn't cost you more than it's worth. Some small businesses take steps to add staff and move into a larger office, only to find out later that the overhead and extra expenses drag them under.
What many small business owners don't realize is that there is a middle ground between doing everything yourself from home and hiring staff to work in a pricey office. Today there are a wide array of alternatives that allow small and mid-sized firms to compete at the same level as the major players in their industry, at a fraction of the cost. How you use the tools to your advantage is up to you. Here are four ideas:
Masterful meetings
Hosting free educational seminars to attract potential clients has always been a popular strategy for small business owners. But most sessions are wrought with two recurring problems: cost and control. It can cost too much to rent hotel meeting rooms that are only available in half-day blocks. And there can be a lack of quality control when you invite prospects to meet at a local restaurant.
There is another option. One rather well-kept secret (for now) is the availability of by-the-hour meeting rooms at conveniently located business centers in larger cities and suburbs. For about 20-30 percent less than the average hotel meeting room, you can secure a conference room in a prestigious high-rise, get on-site technical and administrative support, and have catering arranged for your group.
A home away from home
The technology revolution has made working from home more feasible for many small business owners. But when it's time to take your business to the next level, barking dogs, rowdy kids, and sheer isolation may hamper your growth plans. It might also be nice to invite your clients to visit your office once in a while.
If a more professional workplace is what your firm needs to take off, you don't necessarily have to cut the cord to home altogether. Starting at around a few hundred dollars a month, part-time, drop-in offices are a less costly alternative to leasing and outfitting your own space. These "on-demand" offices come fully furnished and equipped, and provide access to "big-company" amenities like high-powered copiers and videoconferencing.
The incredible elastic office
If you want to build your small shop into the next industry powerhouse, you'll need more office space to bring on new team members. Deciding how much extra space is needed is the tricky part. Not enough square footage could make for cramped quarters if business booms. Worse, you may have to swallow the costs of moving all over again. On the other hand, overestimating your staffing needs could leave you paying for empty space you don't need.
Thankfully, you don't have to guess. Placing your headquarters in a fully furnished and equipped business center can cost up to 60 percent less than leasing and filling out empty office space. And you can add more offices as your firm grows, without the expense of changing the lease or moving twice.
Consider the case of one financial services firm that grew from two to 10 employees in a single year, never moved, and never once paid for office space or services they weren't using. The same scenario would have been nearly impossible with a traditional real estate lease.
Virtual expansion
Growing small businesses may dream of opening a second office, maybe in another city, but there are risks attached. First there's the cost of building out the new office - furnishings, equipment, connectivity, and more. Then there's the long-term lease that you have to pay even if you don't bring in additional business. Instead of diving in headlong, try dipping a toe in the water first with a "virtual office."
A virtual office allows you to establish an immediate presence and test-drive a new location without taking on significant expenses. With a virtual office, you get a permanent address and phone number in a prestigious business district in the city of your choice, and a receptionist to answer and direct calls in your firm's name. Some virtual office providers even include part-time office space at the virtual location, so you can drop by for a meeting when necessary. The power of perception is yours for as little as $99 a month.
With so many low-cost options, it is possible for small firms to project a professional image and enjoy the amenities that high-quality office space can provide. And by escaping long-term contracts and hefty overhead expenses, small business owners can help set their organization on a fast track to growth.
Guillermo Rotman is CEO of The Regus Group Americas. Regus offers a full range of fully furnished and equipped offices, meeting rooms, business lounges, videoconferencing facilities, and supporting services. Visit www.regus.com for more information.
Read this article online at BusinessInsider.com.
How to Get Your Small Business Covered in the Media
By Rohit Bhargava
Local advertising can be effective to reach a regional audience, but when it comes to exposure, nothing beats having a profile piece done on you and your business in the local, regional or even national media. Speaking to many small business owners, many often believe that getting mentioned in the media is simply a matter of luck or networking and knowing the right person. Those certainly help, but there is more of a formula to earning positive press than you might imagine. Though you may not have ever considered working with a public relations consultant or agency to help promote your business, here are a few tips that can help you get coverage:
Be an expert.
You might think that the most compelling thing about your business is the great product you have, or the story behind your business. Those things are important, but being an expert in something puts you on the media radar. You may be the foremost expert in your area on whether homebuyers should choose brick or stone for their house exterior. Or be able to taste the difference between coffee from Guatemala and Cuba. Whatever it is, uncover what you know best and then start including that in how you talk about and promote your business.
Remember the story isn't always about you.
Many small business owners make the mistake of assuming that the only media coverage they should try and get is a "profile piece" about them and their businesses. That's one way to go, but it is far less likely that you'll get covered in this type of story, and if you do it will be a small regional story anyway. Reporters choose topics to write stories about, but most require some real point of views (ie - interviews). If you can be a source for a reporter to comment on a story they are already writing, you will be far ahead of your competition in getting mentioned more frequently in media.
Start with the bloggers.
Whether you consider bloggers to be part of the media or not, they can often be an approachable first point of entry into getting covered. If you can start inviting them to share their comments on your business and perhaps invite them to come and experience what you have to sell, you can build relationships. Those relationships can matter not only because people may read and trust those blogs, but also because they are having a growing influence on the "traditional" media and can lend credibility to your business.
Learn the beats and players.
Whatever the industry your small business is in, there are always going to be individuals that should matter more to you. Do you know who covers your "beat" (ie - the category that your business is in)? Knowing who the right journalists are to know is essential in the world of media, and is part of what a PR consultant would help you do first. How can you target a message or campaign if you don't know your audience? Once you know the individuals you are targeting, you can start to build a relationship with them and offer yourself and your business for comment on anything they may be working on. You would be surprised how often a personal relationship can help lead to being considered as part of an article.
These are just a few tips to help get you started with appearing more frequently in the media. For more advice on doing PR effectively, check out my previous blog post on the things that PR pros should know about journalists as well.
Read this article online at OpenForum.com.
Beginner's Guide: Promote Your Website Offline
By Rohit Bhargava
Sadly, many small business owners starting out on the web forget to promote their website offline. Failing to realize that traditional advertising, marketing collateral materials and public relations are a great way to promote your website to a wider audience. To stay competitive and produce better, more qualified customers, use the following tips to help promote your website offline.
To Win Big, You Must Promote Your Website Offline
With internet penetration over 73 percent of adults in the U.S., according to the Pew Internet and American Life Project, it's no wonder there is such a large crossover of integrated online marketing and opportunities to promote your website offline. Stop for a moment and look around. Open the magazine on your coffee table or postcard from your dentist - just about every piece of marketing has a website address included for you to request more information.
If Your Phone Number Is On It, Include Your Web Address
Think integrated! Promote your website address on everything you would normally put your phone number on. If you use it to communicate with customers, include your website. And, if it's important enough for your phone number, promote your website address too! Promote your website address on:
- Your business cards and letterhead
- New customer marketing kits
- Company brochures
- Product and service sales sheets
- Product packaging
- Newspaper and yellow pages advertising
- Faxes
- PBX and voice mail greetings
- Promotional items
- Business forms
Promote Your Website In Your Public Relations
Don't stop marketing your website with the above advertising and collateral material! Promote your website address in all of your traditional public relations efforts. Be sure to promote your website address in:
- Press releases
- Editorial columns
- Articles you've written
- Media kits
- When quoted or referenced by news media
- Any other published pieces - whether they were actually printed in trade publications, or simply used on your website as supporting marketing materials.
How Else Can You Promote Your Website Offline?
If you've been paying attention to the theme of this article - Don't waste any opportunities to promote your website and small business offline. There's no excuse for not including your web address on every printed piece of communication coming out of your business. Much of your offline website marketing will help move prospects along in the sales process and educate customers who are evaluating your products and services. So get out there and promote your website using offline and traditional media!
Read this article online at Formulis.com.
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