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September 22nd, 2008The ongoing financial crisis in the United States has led to tightening of lending standards, including those for small businesses. Many small businesses are being affected, but it doesn’t need to mean disaster for you.
One of the most important steps to weather the storm is to develop and maintain good relations with your business banker, according to Sovereign Bank marketing manager John Merrill. Much like a bank gaining confidence in a small business, confidence can be built in an experienced banker who has experienced various economic cycles.
A continuation of this theme is in the form of transparency. The more informed your banker is about your business and its plans, the better they can help. Bankers and small business people have the same objectives in mind, seeing your business succeed.
In addition to financing, a banker can help a business with something that is often overlooked, especially in good times. And that is retaining an adequate amount of net worth to weather tougher times. While credit is important, the banker can also offer advice on alternatives and tips on improving cash flow and financial condition.
However, before any plan is developed, a business and their banker must evaluate favorable and unfavorable conditions to provide sound solutions. Identifying hurdles to stability and profitability are vital to setting your small business on that course.July 28th, 2008Besides e-mail and the Internet, cell phones may be the best invention since sliced bread. Small business owners are able to stay within reach if they're out of the office, and cell phones provide a certain level of personal security.
However, many have forgotten proper manners when discussing their business on the phone. How many times have you seen someone having a personal conversation in the middle of a crowd? Or, ever been in a movie when someone's phone rang?
These and many other transgressions are detailed by small business writer Joanna L. Krotz, a native New Yorker, who admits that a problem does exist. I find this almost stunning, considering their high tolerance of urban chatter and in-your-face attitude.
So, how do you make sure you're following proper cell phone etiquette? Some of it is common courtesy, such as shutting your phone off during a meeting, movie, show, etc. It's amazing how many people will not do this, and even actually answer the call!
According to Synovate, a market research group, 72% of Americans agree that the worst cell phone habit is having loud conversations in public. This leads to another etiquette point. Be at least 10 feet away from anyone or find a private spot before taking or making a call.
It is also suggested that you use an earpiece in high-traffic areas, which amplifies your voice so you do not have to speak so loud. And if you must take a call, keep it brief and to the point. Also, demand "quiet zones" or "phone-free areas" at work and in public spaces.
Finally, let all your friends know you have adopted proper cell phone etiquette and please, encourage them to do the same!July 15th, 2008By most accounts, the U.S. economy is experiencing a tough time with the credit crisis and skyrocketing energy prices. The possibility exists, if it isn't happening already, for the nation's first recession since the September 11th tragedy.
Steps can be taken to protect yourself and your company from this, and be at the forefront once the economy recovers and more business returns.
First, and most important, is the protection of your personal assets. Some businesses will inevitably fail during a recession. If you are a sole proprietor or partnership, it may be wise to form an LLC or corporation to protect your home, car, etc. from creditors looking to satisfy their claims in the event your business does not make it.
Next, the difference between surviving a recession and going under depends a lot on cash flow, so keep a close eye on that. Be careful who you extend credit to for services and review and revise your collection policy.
Also, if your company is sound, you may want to apply for a line of credit if your business does not have one already.
Slow times are also no reason to slack off on marketing. Ask for referrals from current customers by offering discounts, or also get feedback. But be sure to reward them for their participation!
Beyond the above mentioned, trimming overhead and remaining optimistic can help you weather the storm. With soaring energy prices, upgrading equipment to more efficient models or making improvements to facilities are also important things to consider.May 22nd, 2008Many small business owners figure they'll save a buck and do their own accounting, bookkeeping, and tax preparation. A new blog post at cpa-pro.org looks at why this may not be such a good idea.
Among the reasons to hire a professional for small business tax preparation are:
- They can offer advice to help you reduce your tax bill throughout the year so you can take proactive steps rather than getting caught in the crunch.
- You can avoid certain legal issues if you take this step to ensure your books are completely accurate.
- You should be dedicating your time for business functions where you can make a greater impact on revenue and growth.
Read the article and find out the number one point to consider when hiring a tax professional and/or bookkeeper.April 25th, 2008At some point, every business has to consider whether they should buy or rent their office space. The decision can vary for different types of businesses. There are several points to consider when making this decision in order to maximize the bottom line.
Many of the considerations of whether to lease or purchase office space is the same for individuals looking for a home. For example, initial cash outlays are much different for each option. Renting something only requires a relative small upfront outlay while purchasing can require a large down payment and other associated closing costs.
However, leases are more subject to the whims of the market when your lease term ends. Especially with a fixed-rate loan, costs are more predictable from year to year when you own the building.
It's important to consider future growth and the need for new space. Purchasing a building that meets your needs now can be advantageous if you're able to lease the space when you move.
But, it also means you're in a second business, real estate investing. And it is entirely possible that can become a bigger hassle and financial drain than simply leasing.
Of course, taxes are a big consideration as businesses can deduct the entire amount they pay in rent while owners have some limitations. It may be better to create a separate Limited Liability Company and then rent the space to your company, according to Joseph Anthony, a Portland, Oregon tax professional.
So, should your small business buy or rent office space? Depends on your circumstances and if you are able to manage the property in addition to running and growing your business. Consult with your tax accountant and attorney to best determine the implications of owning vs. renting.
March 20th, 2008Strategic planning is an important tool for organizational success. It involves the development of schemes that are followed by the entire organization to reach a goal. Strategic planning guidance can be used in any coordinated effort involving more than one person.
Strategic planning has traditionally been heavily used in military operations and government activities. In the business world, strategic planning provides direction in finance and marketing, human resources, information technology, and the general orientation of the company.
Many guidelines exist for embarking on a strategic planning process for your organization. Expert author Jennifer Bailey identifies six important factors to consider including:
- Organizational Mission - How and why it should be achieved.
- Situation Analysis - Examine the organization's current state.
- Vision and Strategic Goals - Identify expectations and performance indicators.
- Strategic Issues - Identify the issues and barriers facing the organization.
- Plan-of-action - Formulate a plan to deal with strategic issues.
- Program Planning - Translate strategies into concrete, well thought out actions.
Strategic planning guidance should never be considered as a guidebook or secret formula for success according to Jennifer Bailey. Rather, it should involve the evolution of simple steps working toward a coordinated, time-bound planning process.
e-StrategicPlanning is an informational resource for strategic business planning, non-profit strategic planning, strategic media planning and more. Having good information is key to formulating a workable plan for your organization.
March 3rd, 2008Proper maintaining and tracking of financial transactions is a necessity for any business to be profitable. It is daunting for anyone to keep meticulous records by hand. Fortunately, basic small-business accounting software programs have become relatively inexpensive and easier to use.
Accounting software allows you to do some basic data entry and other bookkeeping tasks you might otherwise outsource or hire someone to do. However, you and your employees must be properly trained to use the software and many businesses run into trouble by lacking such training.
Joseph Anthony, a Portland, Oregon tax professional, advises that most programs will create balance sheets that always balance, whether the information recorded by the user makes any sense or not. In essence, accounting software operates on the GIGO (Garbage In, Garbage Out) concept explains Anthony.
Small-business accounting software does not eliminate the need for the services of a tax professional. Most accountants though are able to view your records in order to properly address the more complex tax issues. Typically, you can simply e-mail a file containing your data which saves time and money for both you and your accountant.
Most accounting software programs do more than just track annual receipts and expenses. You can also print employee W-2 earning statements, generate payrolls, link with online banking services, and integrate with other applications to track inventory and the like. Properly using small business accounting software streamlines financial record keeping saving you time and resources.
December 19th, 2005by Allyn Cutts
Allyncutts.com
For most folks, owning your own business is a dream come true. The freedom of being your own boss and succeeding to the best of your ability are facts of life for the small business owner. Sure, there's more stress than what you probably imagined when you were creating your grand plans, but with a little strategy and planning you can overcome any tough spot you get in. There are 7 tactics developed by successful marketers that are sure to make your business as successful as theirs.
1. Create A One of a Kind Selling Point
If you want to stand out from the crowd, create a unique selling proposition that stresses the benefits the customers will receive from doing business with you. Will they get faster service? Go ahead and dramatize it, but keep the customer at the focus..."Get free overnight delivery!" Hey, it tells the customer...you get quick service and a discount on shipping. Two definite benefits in one statement.
Why should someone buy from you and not your competitor? I hate to deal a blow to your ego, but it really has nothing to do with you , your product, or your service. Yeah, its a little self-centered, but customers are attracted by offers that point out the things that benefit THEM.
Don't go out on a limb to create new products and services to get attention. Just, add a special benefit to the ones you already have... maybe it's quicker service. The most effective things to emphasize are benefits that your competition cannot or is not willing to give.
2. Use Testimonials
Hey, we all know that business owners think their product or services are the best thing going, but it's what the current customers think about it that really matters to your prospective customers. They're the ones who see things from their point of view... what they have to say about the business has an impact.
Testimonials play an important part in advertising - especially for small businesses. Yeah, big businesses with well-known names don't have to worry about it, but small companies can use testimonials as marketing tools to build credibility.
Think about it...how else can we gain credibility than by creating a group of satisfied customers and shouting what they have to say? Let's look at some ways we can make testimonials an effective part of our marketing campaigns.
3. Upsell
Upselling is one of the most successful marketing trends today. Everywhere you go, someone is trying to get you to buy more. From McDonalds with its supersize options to clothing stores that try to sell you shoes to match your outfit, everyone's jumping on the band wagon. Why? It works!
Your customers already know that you have great products and provide satisfactory service. They trust you to come through for them. Think about it... it's much easier to make sales to someone you already have a relationship with.
Use every opportunity to increase your sales volume within the customer audience you already have. Do you have a product that goes with the one they are purchasing? Offer it to them at the register. It's a proven and effective method for increasing sales. You may be shocked at the additional sales you can generate from those who are already buying from you.
4. Make Your Price Seem Smaller
Divide and conquer... The old war tactic works in marketing too! When the price seems too steep, break it down into "buyable" size bites. An $120 item is only 12 low monthly payments of $10. A $365 purchase would only cost $1 per day. Now that sounds affordable!
5. Paint The Benefits Pretty
Customers buy because they want to enjoy the benefits of the purchase. A lady might buy a dress because she wants to feel sexy, or a man will buy a book because he finds pleasure in reading. Emotions are the key element that drives purchases.
Use word pictures to stir up the emotions that will instigate the sale. Let them "feel" the benefits, and they'll be more apt to head for the cash register. Put them where you want them.
6. Create Attention Getting Headlines
Are you ready to capture your reader's attention with great copy? The headline is the place to start. How often do you scan the newspaper's headlines before you decide whether or not to read the article? Yeah, that's where we lose or gain the reader's interest, so it's a pretty important part of the advertisement.
A good headline should telegraph its message in twelve words or less. Double check those headlines. Do they make a promise of a positive benefit, or ask a provocative question? Don't settle for less than attention grabbing statements.
7. Provide An Offer They Can't Resist
Is your deal too good to pass up? If not, you need to improve it. Hey, I'm not talking about cutting prices even more...you've still got to make a profit. You can make the deal sweeter just by increasing the readers knowledge of the value of the product, or adding bonuses that are perceived as valuable, but cost you little.
Motivate buyers with expirations. Yeah, an open ended offer encourages procrastination...which leads ...yep, nowhere. When the customer knows he has until Saturday to purchase an item he'll pay more for on Sunday, he'll make it a priority to head for your shop.
Copyright 2005 Cutts Group, llc
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Who is Allyn Cutts, and why should you care?
Allyn has spent over 24 years helping businesses like yours find new customers and increase sales to current customers. Allyn is a marketing and sales fanatic, providing measurable marketing solutions that drive huge results for small-to mid-size business clients. Allyn works personally with clients to design and deliver off-line and on-line direct marketing strategies that focus on metrics and measurable results. You can learn more about Allyn Cutts at http://www.AllynCutts.com and you can call 610.437.4106 between 10 AM and 4 PM Eastern Time Tuesdays and Thursdays.
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