Archive for March, 2014


Mondays with Mike: Secret Short Cuts – Legal Aid

What’s the difference between a bad lawyer and a good lawyer?  A bad lawyer can drag a case out for years.  A good lawyer can make it last even longer.

All kidding aside, legal fees aren’t necessarily the first thing entrepreneurs think of when they’re adding up the costs of doing business.  As litigious as society is, though, you’re foolish if you don’t engage an attorney to ensure that you’re legit and covered in case of legal action.  Don’t have the $350/hour lying around to consult a lawyer?  Keep reading.

Here’s my secret for low (or no) cost legal aid.  Head to a local university and talk to the head of the legal department.  Offer your business up for use by students (under the professors’ supervision, of course) as a real-life example.  Your business and its legal needs become coursework for up-and-coming attorneys.  There aren’t many situations in business that are truly win-win, but this is one of them.  Students benefit from concrete experience, rather than boring hypotheticals, and you get your legal work done for free.  Professors love it; students benefit; you save big bucks.

????????????????????????????????????????????????Rather than trying to do it yourself with old legal documents that you dug up online (and which might be completely outdated,) you’re going to get cutting edge, custom work.  Students can draw up your incorporation paperwork, make sure your legal disclaimers are airtight, draft your employment contracts, and basically ensure that you’re covered and are in a position to head off most legal problems that could arise.

You’ll literally get thousands of dollars of work for free, and I strongly recommend thanking the classes who work on your case with pizza or coffee from time to time.

One final benefit from offering your business up to a college department is that you get a preview of the talent that’s emerging from your local universities.  In fact, one of the times that I approached the head of the legal department at my local college, the professor recommended that I work with his best student who was about to graduate.  The student prepared my contract, and the process served as a great extended interview.  I hired him after he graduated, and he ended up being one of my most valuable employees.

Now think a little bit bigger…let’s see how this little secret can work in other areas as well.  Are there marketing students in your area?  Students of web design, graphic design?  Think about all of the exciting, creative work you can cash in on while at the same time providing local students with exciting, valuable real-life experience – experience that they can use to get an edge on the fierce competition they’ll face once they’re out looking for work.  Don’t pass up a chance to get a great deal on the services your business requires, while fostering closer ties to your community and helping better prepare the workforce of the future.


How to Keep the Rule of 3 from Ruling your Business

Even with the best laid plans, it has become clear to me that every business project follows the “Rule of 3”: it takes three times longer, costs three times as much and is three times as difficult as it should be.  This is a universal truth, so if you can accept it and even embrace it, you can put yourself on a path toward a more successful future for your business.

Here are some ways to battle some of the Rule of 3 issues that have been frustrating business owners since the beginning of time.

Everything Takes Longer, but You Can Get There

Setting your expectations too high is often the cause of this phenomenon.  Once you align yourself with realistic goals, you can head for longer term success.  Consider the following situations:

  • Getting the big order from a new client:  New customers may want to test the waters by initially offering smaller jobs.  When you impress them by providing high-quality work on time or before deadlines, the large order will come.
  • Getting a new product to market:  Even with extensive planning, Murphy’s Law accurately predicts that something will inevitably go wrong.  Perhaps a vital part is not delivered, manufacturing becomes halted, or your entire software development team gets the flu a week prior to scheduled delivery.  One way to deal with this issue is to develop an accurate delivery date up front — and then, multiply it by three or at least add some padding to the date. The worst case scenario is that you end up delivering early.
  • Providing on-site support for clients:  The moment you lose control over the place where your work is performed or your product is installed, any number of things can go wrong.  If you need to rely on a client’s computer, you might get a defective one.  Or you may set out to install 220 volt equipment in a building with only 120 volt outlets. Make sure that your contract provides detailed requirement specs and estimates the resulting time delays if those requirements are not met.

Of course, time delays can also amount to income delays.  So, make sure that you have enough capital to ride out the extra time.

Creativity and Planning Helps Handle Extra Expense

Stocksy_txp31123075Gu3000_Small_81280Even the big business players want to bring projects in on budget, but additional expenses do not generally bring their operations to a screeching halt.  As a small business owner, you do not have the luxury of overspending, but there are some ways to help avoid — or at least deal with — financial surprises.

Just as you need to add a buffer when planning the timing for an undertaking, you have to do the same when it comes to budgeting.  After a careful analysis tells you that your new widget will cost $5,000 from design to final production, you need to plan for what you will do if the actual expenses turn out to be $15,000.  Even if you don’t have the cash on-hand to deal with the additional costs, create a Plan B so that you have a pre-approved bank loan in place or someone waiting in the wings to help.

You may also be able to manage the additional costs with some creative strategies.  For example, a vendor might be willing to barter its product in exchange for one of your products or services.  If you think bartering is not a viable way to conduct business, I recently heard of a web designer who conducts all business within a “gift economy.”  He designs and builds websites as gifts for his customers, trusting them to gift back based on what they believe is fair value for his work.  While he reports this business model has worked well for him, I’m not recommending — or even suggesting — that you take such an extreme approach to your cash flow.  But entering into a barter agreement can be valuable in a pinch.

It May be Difficult, but You Don’t Have to Go it Alone

There is nothing better than the power of people.  Every small business owner should find a support group of other business owners that they can use as sounding boards for business challenges.  The Web offers many ready-made groups that you can turn to, or you can form your own group.  Often, the experience of expressing your concerns out loud is enough to help you find solutions.  And the chances are that others in your group have worked through the same issues and have found successful solutions.   At a minimum, they can provide you with some comfort when things are inevitably more difficult than you expect them to be.

Dealing with the Rule of 3 can be one of the most frustrating aspects of running any business, but you can lessen its effects with creative thinking and a few good friends. And for those times when you feel overwhelmed by these issues, remember — there’s always ice cream.


20 Words to Get Your Posts Read

The key to getting any business content read is its headline. Take a lesson from print media, articles with boring titles never get read. Here are 20 words to make sure that prospects and customers read what your company posts:

  1. Numbers:  3, 5, 7 or 10 are a clear winners. Even numbers are less popular. Every reader wants a simple step by step list to accomplish their task.
  2. Easier: They want your business to make it easier for them. They seek an easier way out or an easier way to solve their pain.
  3. Rock star: Most customers have a secret desire to be a famous rock star even if it is only in their immediate world. They will pay anyone to get there.
  4. Capture: The best word to help customers get what they desire. It denotes things that are not easy to accomplish.
  5. Killer: This is a powerful, yet controversial word. It can backfire if used in times of domestic violence.
  6. Secrets: Every customer wants to learn the secret formula that not everyone else knows so they can benefit from it.
  7. Stocksy_txp870288944a3000_Small_22647Perfection: Consumers are always striving for this ideal. They know they can’t really achieve it, but it does not stop them looking for help to get it.
  8. Quick: Customers have no time. They want something fast (see “Easy”). This can be learned from the popular fast and prepared food craze.
  9. Dangerous: Many customers lead fairly mundane lives and seek safety. They want to read about dangerous things they should avoid.
  10. Clever: Customers hope to gain an advantage by being cleverer than the next person. This is a quality that is almost universally admired.
  11. Next level: Every customer wants to go up, forward and to the next higher level. They will buy whatever can help them get there.
  12. Guarantee: This helps mitigate the risk a customer is taking in their purchase. If the results are “guaranteed”, they feel more comfortable to act.
  13. Boost: Customers want quick help to get higher. The “boost” is a popular and warm image from childhood.
  14. Latest: Many customers are addicted to the “shiny object syndrome” and always want the latest and greatest. Companies feed that desire.
  15. Mega: Americans always like things which are large. In fact, the bigger, the better. Many believe that a higher quantity means increased value.
  16. Absolutely: A better way of saying “the best”. It leaves no room for doubt.
  17. Ridiculous: Customers like to hear about the “crazy” so they can pass along these stories to friends and associates.
  18. VIP: Every customer wants to be part of something that not all people can join. It makes them feel special.
  19. Limited time: Customers will act if they believe there is scarcity.
  20. Worst: Unfortunately, people are more attracted to the negative, than the positive. This is the basis of the popularity of every reality TV show.

What are your best headline words?


Work Your Biz Wednesday: How to Provide Outstanding Customer Service

The real secret to keeping customers coming back is to deliver great customer service. Find out how to deliver the "wow" from Small Biz Lady, Melinda Emerson:


Nextiva Tuesday Tip: How to Get the Most From a Temporary Employee

??????????????????????????????????Are you using (or considering) temporary employees in your small business? Last year we told you why hiring temps can be a smart way to staff up without the hassles of hiring permanent employees. These tips will help you get the most out of your temporary employee relationships.

Welcome temporary employees on board. Too many temporary employees are met with blank stares when they arrive at a new job, then essentially ignored for the duration of their employment. Just as with any new employee, your temporary workers should receive a warm welcome to your business. (This is especially important if you think you may eventually want to hire the temp full-time.) It’s a good idea to match the temp with an employee on staff who can show him or her the ropes of company culture. Talk to your full-time employees about the importance of making sure they help the temp fit in.

Provide adequate orientation and training. Sure, a temp will come to you with knowledge of a skill, such as how to use Excel spreadsheets, code websites or operate a certain type of machinery. But that doesn’t mean he or she knows how the particular job he or she is doing at your company works. No matter how impatient you are for the temp to get to work immediately, spend some time orienting temps as to where their job fits in within the company, what the goals of the job are, and how to perform the specific duties of the job. It will be time well spent.

Take care of the proper paperwork. Just because a temporary agency is handling the temp’s payroll doesn’t mean you’re off the hook legally. Temporary employees can still file claims against your company if they feel discriminated against, harassed or if you are breaking wage and hour laws. Make sure each temporary employee reviews your employee handbook and signs a document that he or she has read and understood it. Also review your contract with the temporary agency carefully so you know what forms you need to have the temp complete, what records you’re required to keep about the person’s employment, and how long you need to maintain them after he or she leaves. By dotting all the i’s and crossing your t’s, you’ll protect yourself and your business. 


Mondays with Mike: Fast Flow Prospecting

Stocksy_txpaa3f874fBY3000_Small_164426The business world moves too fast for any of us to rest on our laurels.  While Monday might be great, smart entrepreneurs worry about Tuesday, knowing that ensuring a steady stream of new clients is essential for a healthy business.  It’s a struggle we all face – finding high quality prospects to convert and keep our companies growing. 

Client referrals have always been a traditional source for new prospects, but there are some problems with getting good quality referrals.  If we assume that you’re providing outstanding service to your existing customers, they’ll have two primary concerns about sharing your services with their competitors.  First, they’ll want you to continue to be available to serve their needs.  They don’t want your success to get in the way of their demands.  Second, if you’re providing a service that gives them a competitive edge – whether it’s personal or professional – they’ll be reluctant to share their brilliant discovery – you – with their competition.  They may want to keep you all to themselves.

The gold ring is the organic referral – when a friend of your client is desperate for a plumber, asks for a recommendation, and the client shares your name.  An associate asks who designed your client’s logo, and they give you a rave review and pass on your contact info.  The problem is that these high quality referrals are few and far between, and they’re also – by their vary nature – inconsistent.

So what do you do?  You require new clients, but cold-calling is expensive and yields poor-quality results.

The answer is fast flow prospecting, and here’s how it works:  You approach your clients and ask them for a referral to their other vendors.  They may look at you like you’re crazy.  The angle, though, is that you’re going to reach out to their other vendors and work with them to provide even better service for your mutual clients.  Whether you can consolidate shipments to save your clients money, or whether you can bundle services and offer predictable monthly payments, working with other vendors can help you create efficiencies and provide better service at a reduced cost for the client who referred you.

Here’s the key, though – once you’ve established a relationship with your vendor partners, then you ask for referrals to their other clients.  You’ll be presented with a pool of new clients – clients to whom you’ll be recommended by your partners, and clients for whom you can provide outstanding, streamlined and efficient service.  You’re expanding your network via new partnerships.

So let’s say that you’re a small, independent internet access provider.  You get some vendor referrals from your satisfied clients and you connect with a company that installs and monitors security systems.  The two of you offer bundled services to your existing shared clients, providing them with better, more affordable internet services that improve the reliability of the security system.  Win-win.

The security company shares its client list with you, and you can now pitch your combined services to a whole new group of prospective customers – customers who can get reliable references from the provider of their security services.

Working together with your clients and their other vendors gives you a much wider field of clients, and provides ample opportunity to improve efficiency and profitability for everyone.

 


Transitioning from Networking to Relationships

One of the biggest assets for any business isn’t on its balance sheet—it’s the entrepreneur’s network.  Networks become a valuable source of customer, service provider and even employee referrals and leads. 

However, many people go straight from a networking event to expecting favors or other immediate results.  Like good friendships, network relationships require care and attention.  And like a fine wine, they take time to become robust.

After you network, use the following five recommendations to help you to build solid, mutually-beneficial and long-term network connections.

Take Notes Immediately

The back of a business card provides a blank slate where you can take the notes that you need to begin developing a personal relationship.  When you first meet new contacts, they can reveal quite a bit about whom they are, what they need and how they can help you.  As you jot down key points, make note of any ideas that you have for information that you can share to demonstrate your value to them.  Keep track of this information to help you to know the best way to connect in the future.

Make First Contact Quickly

You do not have a relationship simply because you walk away with a handful of business cards.  Networkers can forget each other’s names in just a few days, so your first meaningful contact happens when you pick up the phone or send an email.

Within a few days of your initial meetings, reach out to remind your new acquaintance who you are and why you are excited about the new relationship.  This is not the time to start asking for favors, but it might be a great time to share a bit more about each other and confirm how your association can be mutually beneficial.

Feed Your Network

I love it when one of my contacts sends me a link to information about our common business interests or even hobbies.  I don’t even mind some good natured trash-talking about the performance (or lack thereof) of my favorite sports team.  Sending valuable and relevant information is a great way to show your commitment to building a good two-way relationship.    

Of course, you need to strike a balance between maintaining regular contact and subjecting someone to information overload—I fondly refer to this as the fine line between being “persistent” and “annoying”.  Only send information that applies specifically to your contact’s interests and concerns.  Articles you send that solve their unique problems are like gold.  Generic information or off-color jokes are like spam.  If you can proactively offer valuable assistance to your contacts, they will want to do the same for you.

Don’t be Afraid to Ask for Help

A good network provides mutual assistance in times of need and feeling free to ask for help is an important part of the relationship.  Personally, I see these requests as recognition of my accomplishments and expertise and I welcome the opportunity to help when I can, if it’s a small, clear and easy ask.  So don’t be shy when you need to ask for help.  Just make sure that you express how much you respect their skills and experience — and remind them of ways that you can help them in the future.

If the request is a significant one, also offer to pay them for their time to show that you value it and them. 

Say Thank You — and Mean it

Whether your contacts generously share information or step in to resolve a specific issue, show your gratitude in a personal way.  While a thank-you email might be nice, you can probably do something more meaningful.  At one end of the spectrum, writing a personal recommendation on LinkedIn or even tweeting or re-tweeting a compliment that brings them more business might be some valuable ways to say thanks.  But when someone brings you a lucrative new business contract or enhances your business in any significant way, an invitation out to lunch or even a gift can be an appropriate display of gratitude.

Making quality connections can be the difference between minor and major business success, so follow the steps above and lather-rinse-repeat as necessary.

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How to Get In Bed with Your Banker

Stocksy_txpf799c772Ea3000_Small_104560Most small businesses still need banks. They provide valuable financial services daily for companies. Banks can still be a major source of capital for the promising business. How do you make sure that they are there when you need them? Get your business in bed with your banker! While this many not conjure up a pleasant image, it must be part of the strategy. Getting the banker to know your company’s capital requirements must be established far in advance of when you may need them. Here is what to do and why it works:

Establish yourself as a customer. Open checking and money market accounts at the bank. Use their merchant, ACH and wire services. Pay fees to use their services. Why it works: Bank employees are trained to help customers and you want to part of that group as soon as possible.

Go into the bank weekly. Be seen at the bank and get to know the branch manager and key staff. Visit at least a few times a month. Talk to them about the bank, their family and your business. Why it works: People do business with other people they know, like, and trust.

Participate in common community events. Go to the events that the banks sponsors locally. Show support for their causes. Get on joint committees. Why it works: You can demonstrate what it is like to work with you and share a common goal.

Share the progress of your company. Sit down with loan officers before capital is needed. Show them your sales and profit projections. Impress them with your knowledge of the financial statements. Revisit them when you make progress toward your goals. Why it works: Numbers are power. They are easy to take to a loan committee. Bankers trust business people that understand them.

Get a small loan. This may be a home equity loan (or similar secured asset) to be used by your company. Pay the loan back on time and then try to increase it. Why it works: This builds a reputable track record the bank can reference.

Keep your personal credit score high (as well and Dunn and Bradstreet number). Bankers like numbers that increase. Why it works: A high credit score will show that you can be trusted to borrow money. They believe that past performance predicts the future.

Bring more customers to the bank. Everyone loves referrals. Be responsible in helping the bank grow their business. Why it works: If you help them, they are more likely to help you.

Go for the big ask: It’s time to apply for the bigger loan for your company. This can be a term note or line of credit. Why it works: Because the bank now trusts you and your company.

How have you got a banker in bed with you to get a loan?


Work Your Biz Wednesday: Resources for Women

Whether you're a woman just starting out in a new business or you're established and looking to grow, it's important to educate yourself about any resources that can help your small business.




 
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