Posts Tagged ‘Work Your Biz Wednesday’


5 Tips for Picking the Right Business Partner

Having the perfect business partner can help you take your business to another level even faster than you could take it on your own. Not only will you have someone to bounce ideas off of, but you can also have someone whose skill sets complement your own, making you a well-rounded team. But just like any relationship, you need to date first and test the relationship, so that you don't make an expensive mistake. Breaking up a business partnership is a major distraction, so you must choose well.

Here’s how to make sure the person you pick is right for your business.

1. Pick Your Partner Carefully.

Just like you wouldn’t marry someone you barely know, it’s important that you get to know the person you want to run a business with. In other words: date before you get married in business.

How can you do that? Work on a few projects together before joining forces in business. See how you work together. Do you flow well, or do you butt heads? Do you enjoy working together?

It’s also a good idea to do a background check to know who you're getting in business with. 

2. Get an Entrepreneur's Prenup.

Even if you trust your new partner implicitly, it’s still a good idea to hire a lawyer to develop a formal partnership agreement. Make sure it addresses how money will be managed and when net profits will be shared, as well as how hiring decisions will be made, and spells out each of your roles and responsibilities. Make sure to clarify terms on exits, buyouts, death, and divorce.

Money can ruin a good partnership. Have clear policies drawn up on how money is handled, including vendor payments, reimbursements, cash withdrawals, etc. Having this document can help you if things go south and you need legal proof of your original agreement. If you agree to change the partnership agreement, legally document the change. 

3. Keep it Business.

Unless you’re married to your business partner, your relationship will do better if you focus on business and keep your ego in check. Never make decisions based on emotions, and do take your partner’s opinion into consideration. Schedule meetings to rtegularly review your financial statements together. Be open with information and clear with communication.

4. Don't Be a Credit Hog.

There is no "I" in team. Successful partnerships can be ruined when one partner wants to take credit for everything. If your partner has come up with a great idea, pat him or her on the back and make sure credit is given where it’s due. It takes teamwork to make the dream work.  If one of you dominates the relationship, the business partnership won’t last long.

5. Value a Good Partnership.

If you have a good partner and the business is successful, celebrate this. That way both will thrive. Always make sure to make decisions in the best interest of the business and not your personal self interest. Just like in any relationship it will take time and effort on your part to develop trust and keep balance in the partnership.  

Understand the value of that partnership and make concessions for the good of the partnership. Remember: this isn’t just your business anymore. You share it with someone else, and everything you do should take that into consideration.


The Difference Between Being an Entrepreneur and a Franchisee

5-27 comparing smallIf you’re planning to become your own boss, one option you might want to consider is becoming a franchisee. In a franchise everything’s already laid out for you in terms of the products you’ll sell and the marketing plan. Many people prefer becoming a franchisee over starting a business from scratch. Still, there are several differences between being an entrepreneur and being a franchise owner that you should be aware of.

1. There’s Less Risk with Franchises (But Still Risk)

Many franchisees are attracted to the fact that they’re buying into a proven business. After all, there are thousands of burger franchises across the country. People are already familiar with the brand, so you don’t have to work to establish it on your own.

Still, it’s important that you know that there are risks with running a franchise. No business is guaranteed, and it will be susceptible to all the same threats as any other business, including recessions, competition, and location (a bad location for your franchise can kill the business).

2. You Have to Follow the Rules as a Franchisee

While technically, yes, you are a small business owner as a franchisee, you essentially sign up to have a master, your franchisor, who will tell you exactly how to run your business. You will sign a contract agreeing to do business the franchise’s way, and there may be penalties if you don’t.

You can’t, for example, change the brand logo, or add new products the menu. The franchise may provide you with marketing materials (though you may have some freedom in how you market locally through newspaper ads, events, and social media).

3. Being a Franchisee is Expensive

Becoming a franchisee involves paying a franchise fee to the company. This is essentially your buy-in fee to have the right to use the brand’s name and products. But you’ll also probably pay a monthly royalty fee based on your sales. When you start your own business, you pay for start-up expenses — like your website, marketing services, inventory, uniforms, etc. — as they come up, and you’re beholden to no one over the long-term.

4. An Entrepreneur Has More Creative License

Because franchisees are limited in the creative decisions they can make, many who want to color outside the lines prefer to start their own business. That way, they can set up exactly how the business will operate, what they’ll sell, and how they’ll market it. If you feel stifled by other people’s rules, franchising might not be for you.

It’s important to understand the difference between starting your own business and buying a franchise. Based on your personality and preferences either one could work for you.


3 Keys to Writing a Powerful Mission Statement

5-20 writing a mission statement smallEstablishing your identity as a small business is a challenge. At first, you may be tempted to chase every dollar you think you can get in the attempt to bring in revenue, but the fact is that if you try to appeal to everyone, you will end up appealing to no one. It is important to hone and identify your core audience as part of your business plan. In doing so, you have laid the foundation for writing your mission statement.

While there are many examples of mission statements that are so grandiose, they are almost a joke, a good mission statement clearly communicates a business's services, the type of projects in which the firm specializes, and unique values offered. For example, as the SmallBizLady, my mission is to end small business failure. It sounds simple, but it is easy to get off track. In order to write a potent mission statement, here are three considerations to get you off to the right start.

1. Give Yourself Sufficient Time to Write.

Mission statements are deceptively simple. They usually consist of a one to three sentences that provide an overview of the business and its goals. However, a good mission statement will also provide a view into the essence of what sets your small business apart from others.

Identifying and communicating your core principle may be challenging. You’ll need to write several versions and give yourself time to edit them into one cohesive statement. It is best if you allow yourself several writing sessions over a few days in order to convey it in a direct and meaningful way.

2. Communicate What Makes Your Small Business Unique.

Many a mission statement has been written on the bones of another more established company's hard work. You may be tempted to take the easy way out and "borrow" a phrase or even direct quotes from a firm you admire. It’s fine to get inspiration from other companies’ mission statements, but yours should be unique to your brand.

3. Use This as an Opportunity to Further Refine Your Business's Core Values.

Not all of us enjoy writing or even think that we can write well. However, this mindset will sap of you of your strength and undermine your confidence. At its core, writing is a powerful form of communication, and strong communication is a central tenet of doing business. It’s all about what you want to be known for.

The exercise of writing your mission statement strengthens your ability to communicate in a compelling manner. It is vital to push yourself to do this significant work in a thoughtful and conscientious way. You might even, through the act of writing, uncover core values you hadn’t elaborated on before.

Your mission statement is the cornerstone of your marketing efforts. It provides clarity and focus on the essence of your business. When you put substantial effort into the creation of this document, you create a steady foundation that helps you move forward with more vigor and determination.


Why You Can Never Stop Learning in Your Small Business

Colleagues working on a creative project in a startup office laughing at funny jokeContinuous learning is critical for entrepreneurs. As much as you may or may not have enjoyed school back in the day, the fact of the matter is that entrepreneurs cannot afford to stop learning. Staying sharp and on top of what’s happening in your industry is critical to long term sustainability.  You also need to keep an eye what your competitors are up to. Still, it takes hard work to continually learn what you need to know. Here’s why you can never stop learning.

Learning From Peers is Key

As a business owner you need to make sure you surround yourself with others who are doing even bigger things than you. Iron sharpens iron. Join a mastermind group in your industry, so consider Vistage or even WPO (women presidents organization) to develop a peer group that you can learn from. Building personal relationships and learning new concepts and ideas does amazing things for your mind.

My learning challenge for you: Find a peer-to-peer business organization to join.

Go Back to School

No I don’t mean MBA school, but I do mean sign up for 6 week business plan or negotiation course. Continued learning helps you set forth with awareness toward broader horizons. Once you see that anything is possible, you can expand your goals and do even more with your business.

My learning challenge for you: Try a free class on a challenging subject via coursera.org. It doesn’t even have to be business-related, and you might be surprised how learning about art or nutrition, for example, can expand your brain in other areas.

Learning Keeps you Growing

It may be tempting to think you’ve seen or heard it all, but you close yourself off to experiencing new things when you embrace this attitude. It may feel scary to admit to gaps in your knowledge or limits in your experience, but you can’t grow beyond them until you recognize them.

The act of learning activates our growth. Your learning can be formal or informal, but ideally a blend of both will propel you to new heights, both personally and professionally.

My learning challenge for you: Make a list of areas you’re weak in, then bone up on them. Learn how to use social media. Figure out how to unclog your own pipes.

Learning Enables You to Learn from Mistakes

We make mistakes in every aspect of our lives, entrepreneurship included. What you do with those mistakes is where your future success is determined. Be embarrassed of your error and shut off from the lesson it teaches, and you don’t benefit. On the other hand, learning from the mistake and changing your path for the better makes you a smarter business owner.

Mistakes aren’t mistakes if you walk away with a lesson learned. Make a point of assessing every situation and gleaning what you can from it.

My learning challenge for you: Consider mistakes you’ve made in the recent past. Did you learn from them, or do you continue to make the same errors over and over? Consider how you can break that pattern.


6 Ways to Renew and Revitalize Your Business Relationships

Business team having fun on coffee breakPeople do business with people they like, know and trust. So it’s really all about the relationship that determines whether or not you get the opportunity to even pitch for the business.  But when is that last time you evaluated your relationships. Joleen Jaworkski, President of Business Clubs America (BCA) of Philadelphia, inspired me to expand upon her six tips for making the most of your business relationships.  Here’s my take on the 6 ways to renew and revitalize your business relationships.

1. Treat Relationships like an Investment

Just as important as the money you invest back into your company is the time and energy you invest in your business relationships. Even when you’re swamped, you’ve got to put time in to check on your customers and contacts and see how you can move the relationship forward.

If it’s been a while since you caught up with some of your key connections, make an effort this month to email, call, or have coffee with each one. While your goal isn’t to sell, you never know where this effort will take you.

2. Be More Understanding and Accepting

Just like with married couples, business relationships undergo their own ebb and flow. Realize that if a client snaps at you, it’s probably not really about you; don’t take it personally. Also, have a grain of patience in your interactions. If, for example, a long-standing customer tells you she’s having some financial issues that are keeping her from paying you, be understanding and offer her a payment plan that will help her get back on track. She’ll appreciate you being so accommodating. The best relationships are made in tough times.

3. Be Present

Raise your hand if you’ve ever been in a meeting with someone who keeps checking his phone or email…or even accepts a call while you’re talking! It’s the worst, and it makes you feel like that person doesn’t value your time.

Don’t be that guy. Put all your attention on the person in front of you, and really hear what they’re saying. Don’t interrupt them with what you think they want to hear; you might be wrong and offend them.

4. Go Out of Your Way to Reconnect

If you are flying to a city to attend a conference or see another client, make a lunch, dinner, a drinks appointment to check in on a current or old client. You often don’t have to go far out of your way to show a contact that you’re thinking of her. You can also email an article that you think a client would like. Send a birthday card. Pick up the phone just to say hi. These little efforts can have a pretty big impact to the recipient of your attention.

5. Be Authentic

I thrive on being myself as the SmallBizLady. I’m nothing if not authentic, and people seem to appreciate my honesty in who I am. No one wants you to be something you’re not; they’ll appreciate you, warts and all. You’ll be surprised by how much you have in common with another professional single mom or dad that travels a lot. So see yourself how others see you, strengths and weaknesses included. Then be that person in every interaction you have.

6. Be Generous

Always look for a way you can serve your customers, even if it does directly put money in your pocket. I often introduce my clients to each other. Even if you hope that your business relationships blossom into sales, that’s not your aim in revitalizing those relationships. Put your focus on giving: giving your time, your energy, your advice, your referrals.

The effort you put into nurturing your business relationships will come back to you tenfold, so keep the energy flowing.


5 Steps to Building a Successful Crowdfunding Campaign

4-22 Crowdfunding smallIt seems like nearly every day, there’s a new crowdfunding campaign or request for support that comes up. There’s a good reason for this, and that is: crowdfunding has become an exciting way for small businesses to build capital to launch a new business venture. If you’re not familiar with crowdfunding, it is the practice of funding a project or venture by raising many small amounts of money from a large number of people through the Internet. If you think crowdfunding may be a viable option for you to raise money, let’s look at how it works and what you need for your campaign to be successful.

There are more than 500 active crowdfunding websites, with the biggest five being Kickstarter, Indiegogo, Go Fund Me, Crowdrise, and RocketHub. While each site has different features and capabilities, they all function basically in the same way. The sites take a commission fee from what you raise (typically 5 – 9 percent). Before you select your platform, you need to decide on your fundraising goal and the time frame. Make sure you research the platforms and their policy on whether you get any funds if your campaign doesn’t meet its goal. Some sites (like Kickstarter) require you return the money to donors if you don’t meet the fundraising goal. This means if your goal is $5,000 and you get $4,999 in pledges and donations, you get nothing.

How to Build a Successful Campaign

Once you decide on the right crowdfunding site, follow these five steps to build your campaign.

1. Work your network first. The worst mistake you can make is starting your campaign and then start using social media as your go-to place to reach prospects. You should be active on sites like Facebook, Twitter and LinkedIn at least six months before the launch of your campaign. Your first 30% of pledges will come from your personal network, and if you can’t get people who you know to invest in your idea, no one else will.

2. Tell a good story. Storytelling is one of the most effective ways to make a sale. If you have a strong idea, tell a compelling story about it. Then write engaging copy that focuses on the story, and create a short video that explains your idea. These will become the basis for your crowdfunding website profile.

3. Do not exaggerate. It’s important to be enthusiastic about your business idea. After all, how can you convince a customer to buy unless you also believe in what you’re selling? But make sure you don’t overhype your project either. If you promise things you cannot deliver, it will turn into a public relations (and possibly legal) train wreck.

4. Have great rewards. People love to get something, even if it’s small, for their donation. Create a list of rewards you are willing to give in exchange for a donation. The rewards should range in significance from the lowest amount to the highest. For example, if you’re crowdfunding to publish a book, perhaps the smallest donation receives a credit in the book as a reward. The highest donation may receive a signed copy and book cover poster.

5. Donor relations are critical. A successful crowdfunding venture does not stop the minute your campaign ends. Have a plan in place to communicate with your network and donors after the funding campaign is over. These people helped you raise the money you need to build your business. Make sure you keep them informed about what’s going on, and thank them whenever you can. You never know when you may need them to raise more capital in the future.

Crowdfunding is a great way to fund a business venture from the ground up. Start researching successful fundraising campaigns, look and your network, and decide whether this is the right medium for you.


Should I Borrow Money from Friends or Family for My Business?

3-15 loaning friend money smallGetting your business started requires money, and while there are many sources for finding this funding, one often overlooked source is friends and family. On the one hand, a friend or family member may be able to offer you an interest-free loan that you wouldn’t qualify for at the bank, but on the other hand, money and the people you’re close to don’t always mix well. Family and friendship dynamics are delicate, so carefully evaluate your relationship with possible creditors before opting for this financing source. Use these five steps to ensure a successful outcome.

Assess the risks from the outset

Begin by having a blunt conversation with your future financier. Talk to her about the risks and pitfalls of this transaction. The idea is not to spoil her enthusiasm in investing in your business, but rather to confront the harsh realities that small businesses sometimes face. If, after this conversation, your benefactor is still ready to loan you money, you have done your part to let her know of the risks she’s taking.

Decide if it’s an investment or loan

Continue the discussion by assessing whether or not your creditor would like to come aboard as a partner and take equity in your company or simply loan you the money and stay out of operations. Be comfortable with the terms and the equity you give, and consider whether this person would be an asset as an advisor to the company or not.

Have a formal agreement

Even if you trust one another implicitly, having a formal contract for the loan or investment is still a good idea. You may not need a lawyer to work out the details, but if the amount of money is substantial, you’ll definitely need an accountant. If your benefactor wants to forego a formal agreement, it may still be necessary to discuss more precise procedures such as what to do in the event of default or bankruptcy. Never promise something that you cannot deliver.

Keep it professional

Treat your private creditor like you treat your bank. Pay on time or early if that’s part of your agreement, and keep track of every transaction. Don’t take advantage of your personal relationship to pay late or not at all. Being formal and professional ensures that you don’t blur lines between business and personal relationships.

Put everything out on the table

Create the habit of communicating with your friend or family member. Let her know regularly how business is progressing. Never make her pursue you for updates. Whether you have challenges or successes, keep her in the loop in the way you would other partners or investors. She will appreciate this and feel more vested in the success of your company.

Deciding to borrow money from someone you’re close to is a decision you need to spend time reflecting on. The last thing you want to do is jeopardize your personal relationship with that person, and money has a funny way of doing that sometimes. Keep the lines of communication open and make sure you properly manage your investor’s expectations.


How to Organize Your Business to Hire Your First Employee

"Staff Wanted" SignFrom your very first hire, you want to make sure you are attracting the kind of employees who will be an asset to your company. You want that first employee to be a hard-working, conscientious individual that you won’t break the bank to hire. But it goes deeper than that. Hiring your first employee requires plenty of planning and reflection to understand your staffing needs and your management style. Your first staff could be the freelancers you need to the full-time admin you need to offload some of your backend tasks.

Start with the Tasks You Need Help With

Before you write the job description that will help you attract the right people, start by simply brainstorming about the tasks you need help with the most. Initially, the list may be helter-skelter, with some admin tasks, some marketing, some finance, and so on. But as you complete the list, start to sort them into categories so you can determine what type of role you need to hire for. Then prioritize those job tasks so you can tackle the most important ones with your first hire.

It’s helpful to divide this list into the following categories. Each job description you put together will likely include some of each:

  • Critical tasks
  • Routine tasks
  • Occasional tasks

Consider Your Hiring Options

Full-time isn’t your only option here, and if your budget is small, it might be further down the road. You can also consider the following:

Part-Time Employee

A part-time staff member typically works 15-30 hours a week, and you aren’t required to pay health benefits for them, typically.  The perk to part-time is that you can adjust worker schedules to reflect the needs of your business. The downside is fewer people are looking for part-time roles.

Temporary Workers

Usually you hire a temp worker through an agency. They’re ideal if you need help for a few weeks or months, as you can let them go when your busy season is over. Another advantage of this option is if you don't like the worker, you can call and get another one.

Contractors

Working with freelancers or 1099 employees can help with short-term needs, such as getting your website designed or handling your virtual admin needs. You don’t pay social security or payroll taxes for contractors. One perk is that you can test out contractors to see how you like them, and then hire them full-time if they are an asset to your business.

Interns

A cost-friendly staffing option is the intern. Look to a local college to find a low or no-cost intern who’s studying a field that you need help in. Once the semester is over, however, you lose your cheap labor. Still, if you like their work, you can always hire them.

Next, Write Your Job Description

Now that you’ve defined the tasks you need your first employee to tackle, organize them into separate jobs.  This is important so that you’re not trying to recruit an amazing admin who not only can file but can also file your taxes, manage your social media, give you a manicure, and run your IT department!. Now, it’s time to organize your thoughts into a job description.

The more detailed your job description, the more likely you will be to find exactly the right fit for the role you need to fill. I like to write down everything that employee could possibly be asked to do so that there are no surprises down the road.

Start Your Search

With that job description, look in as many places as possible to maximize your search. You can (and should) open your job search up to:

  • job boards
  • recruiters
  • social media
  • your network

Let everyone know you’re hiring, since referrals are an excellent source for great employees.

If you’ve spent the time up front to clearly identifying the type of employee you need, you should be rewarded with one who will help you take your business to the next level.


7 Lies About Starting a Business You Shouldn’t Believe

4-1 Lies about starting a biz smallWhen it comes to becoming your own boss, there are often some misconceptions floating around. Let’s banish a few of the ones that you might be told so that you’ve got the right picture of what to expect as you launch your own business.

Lie #1: You Don’t Need to Be an Expert in Your Field

Yes, you do. Don't start a restaurant because you like to eat, make sure you know how to run a food establishment. Being well-versed in your industry is important, otherwise you will learn many expensive newbie lessons. You must be eager to learn, no one can know everything, so invest time in learning the business before diving in.

Lie #2: You Don’t Need Tons of Money to Start a Business

The money to start your business will come from your personal resources. You need a solid financial base to start a business. The average start-up requires roughly $25,000. Start by creating a budget for both your business and personal expenses for the first year. Make sure you have an emergency savings account too. It takes on average 12-18 months to breakeven in a small business, so err on the safe side, set aside enough money to cover both for a year or two.

Lie #3: There is a Perfect Time to Start a Business

The fact is: there’s no perfect time. You will always have an excuse about why now isn’t the right time. Ignore the naysayer in your head and just do it! You can work out the kinks (and there will be some) later.

Lie #4: Your Need to Quit Your Job to Start a Business

You don't need to quit your job and dive into entrepreneurship, there is another way. 

Become a side hustler. You can start your business on the side while you continue to earn a paycheck. Then, once your company is financially viable, you can cut the cord from Corporate America and devote yourself to your company full time.

Lie #5: All You Need is Passion

If all you need is a dream or the passion to start a business, then everyone would do it. Passion is overrated. Yes, it’s important that you do something you enjoy, but you need to make your passion has a profit center. Your success will depend on your business plan and ability to identify a niche customer, and repeat business.

Lie #6: Marketing is Expensive

So many entrepreneurs make the mistake of not marketing their businesses because they think that it’s too complicated or costly. The truth is, there are a lot of marketing tactics you can do yourself, like blogging, using social media, or sending email marketing campaigns. A little effort goes a long way, and many of these tools are even free.

Lie #7: There’s Nothing Left to Learn

Once you launch your business, you’ve likely read every book, blog, and magazine on starting a business known to man. So you’re done, right? Wrong. You will need to continue to learn, as there’s always new information coming in, especially as technology changes your industry. Staying sharp means staying competitive.

There are a lot of opinions out there about what you need to start a business. Others will tell you what starting a business is like, but the truth is: you have to find out for yourself. Everyone’s journey is different, just remember you must grow yourself to grow your business.




 
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