Posts Tagged ‘Growth’


Why Your Business Is Asking All The Wrong Questions

Stocksy_txp6e171103c53000_Small_17064Many entrepreneurs start a business because they have an overwhelming passion around a certain interest. They want to help people accomplish a stated goal. A problem develops in growing their business because they continually ask the wrong question:

“I wonder if my exciting idea can help other people?”

This question is entrepreneur-centric and does not revolve around what the customer wants. Just because a person is passionate about an idea and its solution does not mean that people will pay for it. This is the biggest mistake entrepreneurs make when they try to convert a hobby to a business. They have a dream that they want to earn a living doing what they love. This is a result of a misinterpretation about the feel-good directive that an entrepreneur needs to be passionate about their work. While this is true, a better view is that an entrepreneur needs to be passionate about what the customer wants them to do. Therefore, the better question to ask is:

“I wonder if the customer has the money to solve a pain which I am excited about?”

This question focuses on what the customer wants, not what the entrepreneur needs. The customer cares only about solving their problem, not the passion of the entrepreneur. The answer to this question is the core of what any business needs to focus on. Customers always buy painkillers before they buy vitamins.

Other wrong questions to ask:

  1. Would this product help your company? Again, most prospect will say yes as not to confront or embarrass anyone. Unfortunately, this may not reflect the action they would truly take. Instead ask: What would it be worth to your company if I could fill this need (resolve this pain)? With this question, the entrepreneur establishes what the customer wants and the monetary value of solving their need.
  2. Are you interested in buying the product? Most prospects will simply say yes because they want to be agreeable and not seem negative. What prospects say and what they do are two different things. Instead ask: Where can I send your order? This is an assumptive close and pushes the action to now. It will also immediately raise any hidden objections.
  3. When should I contact you again? Most prospects will give a date in the future and then never respond again. Instead ask: Should I contact you in the future? If so, what will different then as opposed to now? This gives the prospect an ability to say no so time is not wasted in the future. This also self qualifies them for another call and gives insight into what is holding their purchase back now.

What questions are you asking? Are you really listening to the answers?


Why It Was Good That Shaun White Lost

Shaun+White+Portrait+Session+ElxITyhEXx9lLike small business, the Olympics don’t always work out the way they are planned. One of the poster athlete’s for Sochi Games is Shaun White who basically put half-pipe snowboarding on the map. He won the gold medal at the last two Olympics. He was supposed to be a repeat winner this year. After he arrived in Sochi, he pulled out of the slope style event because he thought the course was too dangerous. With all the pressure now on winning the half-pipe event, he lost and came in fourth.

While I cheer Shaun White’s decade of success, it’s good that he lost in front of millions of people. Here is why and what you can learn from it:

Things don’t always go as planned. Even with endless hard work and preparation, sometimes you just lose. Similar to White, the course may be rough (the market) or the other athletes (competitors) may be better that day. No athlete or company can control all the conditions. Every small business owner needs to get used to not knowing what will happen. There are no sure things in sports or business and this pushes everyone to work harder.

Even the favorites lose. No matter how dominant your business may be in the market place, you won’t always win. You have to earn a victory each time you compete and not mail it in. While White’s competitors were well qualified, no one would have predicted 15 year old, Ayumu Hirano from Japan would win the silver. The favorite has to work just as hard and the rivals always have an opportunity to win.

How you lose counts. White did not let this one loss define him. He said, "I don't think it makes or breaks my career, one night;" he never blamed the course or the other competitors. After his failed run, he agreed to celebrate with Swiss Gold Medalist Iouri Podladtchikov (IPOD).

The best push the rest. The top dog gets everyone to improve until they get beat. This is good for any competitive market because in the end, the customer (or viewer) gets a better product or service. The best business always gets pushed by other companies that want to be them.

What will White do next? Looks like he is going to dust himself off and compete in 2018.


Mondays with Mike: The Tier Method for Increasing Revenue

A disclaimer of sorts:  This method of boosting revenue is intended for entrepreneurs who own businesses that are already making a little money.  This strategy can help you look down the road if you’re just getting your business up and running, but the method I describe in this article is intended for established businesses, rather than those just starting out.

More money.  It’s an appealing prospect, but it’s not always easy to achieve.  One of the most versatile solutions I’ve ever found is the tier method, and it’s successful because it’s such an elegant and simple strategy. 

Here’s how it works:

Your business is established, and you have a good product, but you’re looking to increase sales.  The answer is simply to create additional, higher quality (and higher priced) offerings. 

Let’s look at some examples:

  1. ????????????????????????????????????????You own a restaurant, and you’ve found success with your weekday, prix-fixe menu.  Folks love coming in and selecting three courses for a set price.  How do you step it up?   Add on the option for wine pairings for each course (with an additional fee, of course.)  You’re adding an additional tier of services that will entice your existing customers.
  2. If you own a cleaning service and have regular customers, but need a way to get more from them, create tiers of service.  Your existing contracts – let’s call that your Silver Service – is offered at the current price.  You add Gold Service with additional services – periodic window cleaning or carpet shampooing, as well as Platinum Service – where you clean everything that doesn’t move.   You’ll inevitably find some clients who want to step up to a better plan, and your new clients are likely to settle for the option in the middle, so you’ll be starting them at the Gold Service – it’s your new default setting, complete with higher price tag.
  3. You sell original artwork, either online or in a brick and mortar store.  Your customers love your work, and you decide to offer additional options.  Your first tier is the watercolor painting – the work your clients know and love.  You offer one option of adding a frame, and a second option of high quality mats and a custom frame.  You’re adding tiers of service that save your clients the time they’d have to invest in selecting the perfect frame that shows off your valuable artwork.  

Why is the tier method so successful?  You’re starting with an established brand – a product or a service that your customers already trust and enjoy – and you’re offering a better version of that product.  We all want the best, and we’re conditioned to think of selecting the least expensive option as settling for less than the best.   Airlines make bank on pricier seats in first class.  People pay extra to buy iPhones with more memory than they’ll ever use.  If you offer your customers pricier options, it is inevitable that some of them will take you up on it.

The key here is to offer authentically better options.  We’re not talking about smoke and mirrors  — playing games with your clients is a tactic that can alienate loyal customers.  Rather, you want to develop tiers that are meaningful and offer additional value that’s appealing to your customers.  You’re finding a way to enhance your existing high quality offerings by creating options with added benefits to your clients and added revenue for your business. 


Why Big Leaps Are Dangerous to Your Business

??????????????Most small business owners think they have to take giant risks to be successful. They reason that the greater the risk, the bigger the reward. This is common wisdom since when a success story gets publicized, no one hears about all the interim steps that were taken to get to the final result. No one sees the up, down, and sideways paths it took to reach that goal.

Forget the giant risks. It is much safer and ultimately more effective to make a small decision, examine its result, and learn what you can from it. Then make another decision based on that outcome. Think of each small decision as another piece of completing a puzzle. Never pin the future of a company on one decision, action, or resource. “Go big or go home” or “playing for all the marbles” may make a good slogan, but it has no real place in business.

Here is what to do get the most out of each new opportunity:

A huge customer: Downsize expectations. Start with small sales goals. No matter how big the opportunity or how famous the brand, keep the excitement in check. While you may not want to treat them like just another customer, assume sales will build very slowly over a longer period of time.

The next employee: Be realistic. On any team, a new player can have an impact, but typically this takes time. Before hiring, find out if the prospective employee truly has demonstrated what they can do in the job. Having previous experience at a competitor or a large brand-name company may not translate to success at your business.

The next product line: What have the initial customers said about the product? How can it be rolled out to a small release to ensure it works as expected? Have these initial customers paid for the product, and what real results have they accrued as a result? Most products take time to be adapted by the marketplace. This also usually only happens when supported by a substantial marketing budget.

The next consultant: No matter how good their experience is, one person cannot make a huge impact immediately. Start the consultant with a small scoped project with stated goals. At the project’s completion, match the goal against the actual results. If the outcome is positive, do a second project and build scale from there.

The next market change: Test, test, and test. Do this before a large investment is made in project development or a big marketing expense rollout. Have you really identified a pain in the market from people who can pay to fill it? This is only demonstrated by paying repeat customers (and referrals) and not with what prospects say when you survey them. Many people will say yes when surveyed, but few will say yes when you actually ask them for money.

The next competitor: What a customer substitutes for one product is constantly changing, so it’s difficult to keep up. Know everything customers do with the same money they use to buy your products or services. Keep up to date on all these competitors, and track where they are making their largest investments. As Chinese general Sun Tzu said, “Keep your friends close and your enemies closer.” 


Work Your Biz Wednesday: 6 Tips to Better Crowdfunding

Crowdfunding is a great way to raise money for a small business. Find out how to get started from The Small Biz Lady, Melinda Emerson.


Are You a Fake?

a-penguin-imposterMany small business owners suffer from the imposter syndrome. They feel that their customers or employees will find out "who they really are" and lose confidence in their ability to run the company. This fear holds many people back from displaying who they really are at work. This becomes a problem in the transparent world of the Internet where "being human" and authentic are highly valued by customers.

Customers buy from who they believe, like, and trust. Without being authentic as a leader and a company, this will never happen and it will become impossible to build a profitable company. Here is what to do:

1. Tell the truth. This is more difficult than it first seems in small business. Most owners have good intentions, but sometimes are afraid to disclose to employees and customers what is really happening. How to be authentic: Focus on the companies strengths. Always deliver good and bad news in a timely fashion. Don't be afraid to be humble and show personal or company warts. Build a culture of openness and frequent communication. 

2. Stick to the brand. Many times, companies want to be everything to everybody. This leads to telling the customer that the company can do things that they really can't. This leads to frustrated employees, disappointed customers and an unprofitable businesses. How to be authentic: Determine the exact customer segment served and the pain solved. Get clear on what the company cares about. Stay focused on delivering outstanding results in this niche area.

3. Hire employees that want to be part of the company's culture. Too many times, owners hire a person to fit a particular job. They rush into a decision and don't understand how that person would work in the overall company culture. How to be authentic: Hire for attitude over skill. Think about how the new employee will complement the rest of the team. Have team members give feedback on prospective employees.

4. Be consistent. Too many times, the company's brand does not match it's culture. The friendly company persona contradicts the cut throat office atmosphere. The boss is sometimes an angel and other times an ogre. How to be authentic: Live the company brand. Be the same person inside and outside the office. Be the same in front of managers, staff and customers. Have no hidden agendas. Set an example by practicing whatever is preached.

Are you authentic? How do you demonstrate it? 


Work Your Biz Wednesday: How to get More Likes on your Facebook Fan Page

Find out ways to boost your Facebook fan page engagement and build your brand online with the C-Q-H-L approach from The Small Biz Lady, Melinda Emerson.


5 Ways to Boost Your Cash Flow Right Now

2014-01-13_1019During the 1992 presidential election, there was a sign that was reportedly hung by James Carville, Bill Clinton’s campaign manager in their Little Rock Office that simple stated “It’s the economy, stupid”. This was a reminder to everyone that worked there that the only thing that the national race was about was the economy. That year, I started my third business after failing in two others. This time, I made my own sign and tacked it up in my office. It read: “It’s cash flow, stupid”. It became my daily reminder and mantra. Starting out in my first business in 1980′s, I thought that the only thing that mattered was to sell my product to whoever would buy it. I reasoned that if you make sales, you eventually make money. This worked great until customers didn’t pay me on time or at the same rate as my business expenses grew. Unfortunately, even if my customers did not pay their bills when they were due, my employees and vendors still wanted to get paid on time. What I realized is that sales do not pay bills, cash does.

Collecting the cash from sales means everything. It is the gasoline that makes your business engine work. Without cash, your business literally suffocates. Most businesses fail because they run out of cash leaked through losses or other poor management practices.

How to improve your cash flow in your own business:

  1. Open the bank monthly statements. Check to see if you have more or less cash when comparing the beginning month and end of month balances. If the end of the month cash balance is higher, the company is cash flow positive. If the end of month balance is lower than at the beginning of the month, the company is cash flow negative.
  2. Learn to read the cash flow statements. Don’t outsource the math. By definition, cash flow is typically your monthly profit, plus the change in accounts payable, the change in accounts receivable, and the change in inventory. The higher this number is monthly, the healthier your company will be.
  3. Collect accounts receivable faster. The sooner a customer pays, the higher the cash flow. The Days Sales Outstanding (DSO) for your business should never be more than 133% of your invoice terms. Don’t extend credit to a customer that has not proven they can pay in a timely fashion. Remember that credit is a privilege, not a right. Better yet, get your customers to pay with credit card or prepay your services.
  4. Get longer terms from vendors. Extended credit from your vendors will boost your cash. Always pay within the agreed period of time. However, if you have 30 day terms, try to get 45 days by building up a reliable track record.
  5. Selling inventory faster and keeping your inventory levels lower.  Buying inventory only to sit for months on your shelf waiting for customer orders can take a lot of cash out of the business. Track your inventory carefully. Know what sells quickly and what never moves off the shelf. Know how long your customers will wait for a product and still be satisfied. This will determine the setting of reorder points (when a product is reordered to be put into inventory) and the reorder quantities (how much is reordered).

What have you done in your business to boost your cash?


5 New Years Resolutions Small Business Owners Should Keep

By now you’ve probably made a list of New Year's resolutions and already crossed a few off your list. And it’s still January. Don’t worry; you aren’t alone. Only about 8 percent of us keep our resolutions every year, according to the University of Scranton.

Defy that depressing statistic this year by sticking to these five resolutions from small business expert Lauri Flaquer.

#1. Embrace change

Don’t be afraid to change things up this year. “Look at your opportunities to grow and look at what needs to stay the same,” recommends Flaquer, owner of Saltar Solutions, a business consultancy in St. Paul, Minn. “Invite change and growth will follow.”

#2. Evaluate your performance

How good of a job are you doing? Not sure? “Many managers live in their own little worlds and are not always able to see things the same way outsiders see them,” she says. Put together a group of people whom can interdepedently tell you the truth about how things are going and considering asking your employees for 360-degree reviews.

#3. Make work fun

“Strive to be a company that your employees rave to their friends about,” says Flaquer. Focus on upcoming holidays—like Mardi Gras—and spring for a cake, beads and masks for the whole office, she recommends. Or host a monthly birthday party.

“It really doesn’t have to cost a lot of money,” she says. “I know a company that has a barbecue every Tuesday where one person brings in all the food for the department. Each person has to bring in food about four times a year, but they get to eat for free during every other Tuesday.”

#4. Clear clutter

You know that piece of inventory that has been sitting in the corner of the break room for the last two years? Get rid of it and don’t look back. If you haven’t used it, you don’t need it. The same goes for the mountains of vendor magazines piled up in your file cabinet, collecting dust.

Parting ways with your office clutter will make you feel better. “Clutter holds you back from having new ideas, fresh thinking and getting around your workspace,” she says. “Task your employees with clearing how their workspaces, too. Everyone will breathe a huge sigh of relief.”

#5. Join a mastermind group

A mastermind group is a collection of people that get together to discuss a business topic and look for solutions to problems. Flaquer recommends small business owners either create their own group with other local business owners or join one online.

“Look for a group of people who are more successful than you,” she says. “Those are the people who will push your forward and help you achieve your goals.”

??????????????????????




 
Nextiva Logo

phone-icon(800) 799-0600 Sales phone-icon(800) 285-7995 Support
Nextiva is the leader in Business VoIP Services. Copyright 2014 Nextiva, All Rights Reserved,
Terms and Conditions, Privacy Policy, Patents, Sitemap