Tag Archives: Business Planning

A Business Perspective

A Business Perspective

We’re all committed to working smarter these days. We’re busy cutting expenses, trimming the fat and streamlining processes whenever possible. But there’s one wasteful habit we’re loathe to give up. Many of us still want to sell to “everyone.”

These days, most entrepreneurs are thrilled to sell their wares to anyone who wants to buy them, and that’s fine. However, when you try to include “everyone” in your marketing message, you may actually end up reaching no one.

When you broaden your message too much, you risk watering it down to the point where it no longer resonates with your best prospects. That’s symptomatic of a lack of focus—a dangerous flaw to have, especially now.

Furthermore, small businesses simply don’t have the time, resources or staff to chase every demographic. The reality is you can’t sell to everyone. Nor should you want to.

Yet many companies continue to take a scattershot approach to marketing and sales, thinking they’re more likely to score a hit. The truth is, if you want to hit the bull’s-eye, aim with a rifle, never a shotgun.

How do you do this? Start by determining who your best customer is by reviewing your current customer base. Identify your “A” list customers, along with what makes them valuable. Describe them in as much detail as possible. What common attributes do they share? Is it age, gender or annual income?

If you are a B-to-B operation, you can use the same kind of process. Do you value large firms or small ones? Or companies in certain industries or areas? Keep thinking until you arrive with a detailed description of your target B-to-B prospect.

Next question: What draws them to your products or services? What needs do you fill? How do you fill them better than your competition and how can you improve?

By the time you complete this exercise, you should not only know what your target market is, but what message you should be marketing to that market.

The same philosophy applies to customer service. Are you exhausting your staff in an effort to provide exceptional service to all customers? That may be admirable, but it’s not very wise. Resources are limited, especially these days, and frankly, not all customers deserve it.

So figure out who is worthy of your best service. Start by classifying your customers in groups from “A” to “F” based on criteria that matters most to you. Is it a customer’s sales potential, profitability or payment history? Is it the ease of doing business with them?

Once you’ve classified your customers, analyze what level of service you’re providing to each of them. Logically, you should be reserving your very best service to your “A” list customers, but don’t be surprised to find you’re providing best service to your worst customers. Often, the demanding, difficult accounts are the ones you spend the most energy trying to please.

There is both a direct and indirect cost to servicing a customer. Delinquent accounts, demanding accounts and unprofitable accounts all represent lost opportunity. And while no one wants to lose a customer right now, can you really afford to let an “F” list customer put a drain on your organization?

And if you recognize that you’ve been taking some quiet “A” list customers for granted, maybe it’s time to shower them with more attention.

Targeting customers is yet one more way you can cut, trim and streamline your business. It will save you money, time and aggravation, but best of all, it will also position you for future growth.

 

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Small Business Owners – It Ain’t Over Til It’s Over

As Yogi Berra said, “It ain’t over ‘til it’s over.” He was talking about baseball, but he might as well have been referring to the recession. But, we aren’t out of the woods yet.

For most small business owners, outwitting the recession has become an obsession, and in many cases a necessity. It’s certainly a subject we discuss often in our PRO peer advisory boards. Even after more than a year, I’m still learning new survival strategies, while finding value in revisiting the tried-and-true. You never know where or how the next good idea will surface. And when things are this dire, you can’t afford to leave any stones unturned.

Have you done everything possible to transform your company into a lean, mean fighting machine? One that can withstand the worse economic conditions since the Great Depression? Are you still searching for solutions? Do you need help taking action?

With this in mind, let’s consider some simple-but-powerful recession-proofing strategies:

Know Your Cash Flow – Right now, every small business owner should be projecting monthly cash flow (i.e., incoming vs. outgoing funds). Managing via your Profit & Loss statement is fine under normal economic conditions, but right now, P&Ls can lull you into a false sense of security. Do you know what’s coming in, versus what’s going out? If not, it’s time to learn.

Really, REALLY Reduce Expenses – Have you slashed your expenses as much as possible, in every conceivable area? I recently broke down typical small business expenses into 35 categories, some obvious, some easily overlooked. Do you still have cuts to make, but can’t seem to take action? What are you waiting for? What will it take to make you act?

Ramp-up Collections – If you’re having trouble collecting outstanding receivables, you’re not alone. But your old methods may no longer be sufficient. Consider new approaches, from getting personal (how about sending your accounts a “roses are red” delinquency love poem?) to getting tough (as in, yes, refusing to deliver more product until the account catches up).

Conduct SWOT Analysis – When was the last time you took complete, objective stock of your business? After all, you can’t make improvements until you know what you’re dealing with. Now’s the time to buckle down and analyze Strengths, Weaknesses, Opportunities and Threats.

Set SMART Goals – The Boy Scouts were right: if you fail to plan, you plan to fail. The key to achieving goals is to make sure they’re SMART: Specific, Measurable, Achievable, Realistic, and Timely. Write them down, break them down into steps…and yes, get them done.

I recently achieved one of my own key business goals. I finished writing my new ebook. “The Small Business Survival Guide: How to Survive (and Thrive) During Tough Times.” It’s filled with all the strategies I’ve learned over the years and especially this last one.

You can buy it now at http://www.thesmallbizsurvivalguide.com/Survival_Guide.html. For a special introductory price of $11.95 (the regular price is $19.95), you’ll get the collective wisdom of the best business minds I know. Buy it…I guarantee you’ll learn something you can apply to your business NOW.

Why? The biggest question you will ever ask with one word

Why?

Ray and Zen are forward-thinking pragmatists, albeit ‘advisorologists,’ who have a penchant for seeing things differently. The combination of wit and wisdom bodes well for radio. Our guests report an ease of conversation and delivery of their message in a very personable way, the new way of marketing in the new millennium… relationship building. It’s all important in developing sustainable business, let alone growing your market share.

Simon Sinek is a movement maker, a way-shower for building momentum that matters in our world today. He’s insightful and spot on in observations of how we behave and using those observations to create maximum results. This book is about a naturally occurring pattern, a way of thinking, acting and communicating that gives some leaders the ability to inspire those around them.  Start With Why is a guide to focus on and amplify the things that do work to inspire.start_with_why1

Just about every person or organization needs to motivate others to act for one reason or other.  The ability to motivate people is not, in itself difficult.  It is usually tied to some external factor.  Tempting incentives or the threat of punishment will often elicit the behavior we desire.  Great Leaders are able to inspire people to act.  Those who are able to inspire give people a sense of purpose or belonging that has little to do with any external incentive or benefit to be gained.

Those who truly lead are able to create a following of people who act not because they were swayed, but because they were inspired.  For those who are inspired, the motivation to act is deeply personal.  They are less likely to be swayed by incentives.  Those who are inspired are willing to pay a premium or endure inconvenience, even personal suffering.  Those who are able to inspire will create a following of people, supporters, voters, customers, workers–who act for the good of the whole not because they have to, but because they want to.

All the inspiring leaders and companies, regardless of size or industry, think, act and communicate exactly alike.   Great leaders understand the value in the things we cannot see.

You’ll want to grab Ray’s Crib Notes on the book, too. The salient points are described in great style and clarity so you get the best of the book in short order. You can request the Crib Notes simply by using the form below:

Enjoy the Show!

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Business Structures

2 Small Biz Guys engage a pretty dry subject with a little flair – business structures. Although the topic is about as interesting as watching paint dry, business owners have to face the fact that their business must have some legal structure. We are not attorneys and you are advised to consult both an attorney and CPA when determining how to structure your business.

The basic business structures include Sole Proprietorship, Partnership, C-Corporation, S-Corporation, Limited Liability Company, Trusts and Employee Stock Ownership Plan. The structures move from very simple with complete liability of the business owner to somewhat complex and less direct liability. Often businesses go through a progression or evolution from one to another over the course of the business’ growth. We discuss the various forms and the distinctions of each regarding personal, financial and tax liability.

Initially, determining a business name requires various legal forms, checking with the Secretary of State for the availability of the name, and filing appropriate paperwork with the State Corporation Commission. Every state is slightly different yet very similar in the process. For branding purposes, your business name should be descriptive and distinct regarding the business itself. It’s always best to describe what you do in your business name.

We close the show talking about the growth of holacratic businesses, like Zappos, and their challenges as Millennials take over the world.

You will find some useful information in our discussion and perhaps gain insight toward your own business path.

2 Small Biz Guys w Rick Murray CEO of ASBA

2 Small Biz Guys, Ray and Zen interview Rick Murray, ASBA CEO aka the Arizona Small Business Association, and travel many paths regarding small business in Arizona. Rick shares a little of his background with the State of New Mexico’s State Fair Grounds on his way to the leadership role of Arizona’s premier advocacy group.

Speaking of advocacy, we discuss the recent Crowd Funding legislation that he was instrumental in facilitating, a truly time sensitive opportunity and collaboration that met with success. It is a great win for small business owners and an example of what collaborative effort can do. You’ll have to hear the story. Look forward to further information coming from ASBA on the process and even some training on how to develop your own crowdfunding resources.

We explore various services that ASBA provides for both members and non-members, including a state-of-the-art health care coverage website that is open to anyone. You can hear more details during the interview. We talk about the ASBA Marketplace, too. We cover some critical points for the development of relationships and, of course, the follow up that is imperative for successful engagement.

As an entrepreneur or small business owner, no doubt you will benefit from this interview and, perhaps, decide to engage the Arizona Small Business Association to help develop your business. Ray and Zen are both members. Ray is also on the ASBA Mentor Board, which provides consultations for small business owners. Like any smart business owner knows, accessing those who have gone down the similar roads previously often provide insight and wisdom beyond measure.

Enjoy the show and feel free to reach out to us for help, too.

ASBA Mentor and Member (Ray and Zen) make ASBA membership work for you. We offer a special opportunity for ASBA members – EXTRA TIME (2 slots for the price of one – that’s double the time). Just fill out the appointment popup (Let’s Talk in the lower right) and tell us Rick sent you.

Small Business Help – Coaching, Consulting, Peers

We tend to address things in more of a general sense when talking about small business challenges. Tonight’s show was indicative of the reflections of our insights and understanding of various tools. Coaching helps business owner set up action plans once goals and objectives are determined through a variety of questions the coach presents. Consulting focuses on specific issues within the company, creating change management scenarios that, when the employees and staff are involved, provide the opportunity for better buy in and success. Peer advisory groups allow the business owners to engage and reflect with others who have similar challenges, which often isn’t possible in more confined environments.

All businesses rely on sales, but the process for garnering them is often vastly different. There are some basic that often get overlooked. If a sales goal is ‘X’ the construction of the process to get there is all important. It is a numbers game. In the digital world, ‘X’ is achieved through generating traffic and garnering sales as a percentage of the traffic. The rule of thumb is that a .05% success rate is good. So, the question is, “How much traffic must be generated to achieve ‘X’?” That is just a first step, but a necessary one that a lot of business owners forget to address. Numbers are your friend. Don’t leave them out of the process.

Here’s the recording of this week’s show with Ray and Zen: