Tips for Tough Times VI

Just about everyone is being affected negatively by the economy. I talked with our exterminator the other day and he said that his customers are cutting back, doing it in-house, going without.  Very few businesses are immune.

Hopefully you are taking some actions to minimize the impact.  One thing for sure you need to do is revise your business plan for the year ahead and review it every quarter or six months as the variables change rapidly.  If you don’t have a written plan, now is the time to start one!

Areas you need to consider:

1. Your industry
2. Your market
3. Your specific target market(s)
4. Your sales/revenue forecasts
5. Your cost-of-goods sold and expenses
6. …

SCORE.org has a free 31-page business plan outline – download it and plug in the relevant information that needs to be updated.  What are some of those variables that impact your business?

• Customer needs! (and wants and current preferences)
• The economy
• Your competitors
• Suppliers
• Technology
• The environment
• Legislative/legal issues
• Organizational dynamics
• …

Above all, keep a close eye on your financials, especially your cash flow!  Run those numbers weekly!!

Next time we’ll talk about the next level – Scenario Planning.

Dick McCormick      Biz Success With Less

For more business tips, go to www.BizSuccessWithLess.com

Tips for Tough Times V

I do hope that by this time you are taking some action steps to help ensure the viability of your business. The economy is getting worse and it is not expected to improve until late in 2009.  In the past several months I have talked with barbers, funeral directors, retail owners and others – everyone has been affected by the slowdown!  Review these past five posts for things (perhaps several major or just several minor things) and develop an action plan suited to your particular situation.

1. Specialize – This was also suggested last time.  Identify a segment or several segments of your overall market with special needs and tailor your products AND services to these.  The more you specialize and offer something the competition doesn’t, the more you can charge.  You may not sell as many/much but you can create larger profit margins.

2. Innovate – Respond to the latest trends and market developments faster than the competition.  This means that you have to keep up with the latest trends through researching the market.  This can be done online, through industry contacts (like sales reps), through industry magazines and newsletters, through associations, through trade shows.  You can reposition yourself as the trend-setter in your area.

3. Think Service - If you sell a product, what service(s) can you ADD that would better meet your customers’ needs?  Don’t know?  Ask them.

4. Train Employees – Your employees are your greatest asset!  While business is slow, improve your employees’ ability in sales, in service, in thinking of ways to improve customer service, in ways to reduce costs, in ways to add value to the shopping / buying experience.

Don’t sit around lamenting!  Develop that plan; keep it short and simple.  Then implement your plan one step at a time!!  Your business will improve:-)

Dick McCormick     Biz Success with Less

For more business tips, go to www.BizSuccessWithLess.com

Tips for Tough Times IV

The question still remains – Are you taking steps to counter the downturn? Are you documenting them and tracing the results?  Here are additional tips that might help.  Remember, one, two, or three actions could make all the difference!

1.  Continually look for new and different customers. Experiment with all sorts of niches (subsets of larger groups of customers) and see what works. (See the book “Riches in Niches” by Susan Friedman.)

2.  Test these niches with inexpensive marketing techniques such as proactive networking, postcards, enlisting strategic alliances (other businesses selling complimentary products/services to your target market).

3.  As you think about and experiment with niches, think about complimentary products and services you can offer both your existing and potential customers.

4.  Don’t forget to keep asking current customers what they would like to see you offer, what might make it easier to do business with you.  How can you add value for your customers?

5.  Consider government contracts, especially if you’re in a state with military bases.  The government purchases innumerable products and services and usually has set-asides for small businesses.  Do a Google search.

Dick McCormick     Biz Success With Less

For more business success tips, go to BizSuccessWithLess.com

Tips for Tough Times III

All the signs and experts point to an extended recession.  You just can’t sit around waiting for things to get better – you have to act NOW if you want your business to survive!! This is the third post on survival: read all three and determine to take SOME action steps tomorrow, even if they are painful.

1)  Evaluate how you get customers and then do more! Applying the 80/20 Rule, there are probably two or three strategies that generate 80% of your business.

• If advertising works for you, do more.
• If word of mouth is a key strategy, determine how to proactively promote that, with rewards or …
• If networking is effective, determine to get out there and do more networking.
• If strategic alliances (non-competitive business collaborations) are important, build those relationships and look for more.
• If your Website produces results, keep it fresh.
• Also look at inexpensive marketing techniques.  Google different phrases like “small business marketing techniques” and take the best ideas to try out.

2)  Also evaluate your existing customer base: the 80/20 rule here says that 20% of your customers generate 80% of your sales.

• Can you sell more to your existing customers or your KEY customers?
• Can you add other products or services that your existing customers might like?
• Do you have a proactive referral program for your customers to refer prospects to you and be rewarded for this?

That’s it for today – short, sweet, simple.  Determine to do just ONE thing this week to improve your business, but make sure that it is the one that will generate the most results!!

Dick McCormick     Biz Success With Less

For more business success tips, go to BizSuccessWithLess.com

Tips for Tough Times II

“Tips I” was posted two weeks ago.  As the U.S. and world economies continue to decline, have you taken measures to reduce expenses or increase revenue or profit margins?!  Don’t wait any longer. Unemployment rates are increasing, businesses are going under.  Have YOU assessed your own industry, market, competitive positions?  You may have to take drastic measures to survive.  Ask several of your business friends to help you assess and help you make decisions on what to do.

Continuing with the Tips:

1.  KEEP MARKETING -Whatever else you do, don’t cut your marketing budget.  You’ll be healthier and have a greater market share when things get better, because your competitors will have cut their budgets.

2.  Find cheaper space or try to renegotiate better terms: it’s a buyer’s market right now.

3.  Buy secondhand office equipment and furniture.

4.  Since larger companies are striving to reduce overhead and fixed costs, you have a better chance of providing outsourced services (or products) to them.  Is there a part of your business that could offer value to the larger companies in your area?

5.  If you have underperforming employees, now you have the opportunity to hire great talent from the pool of unemployed or underemployed.

6.  Consider a customer loyalty program to keep the customers you have.  Offer your good customers discounts or some sort of reward, like the tenth one free. A simple punch card can work.  Or google “Customer rewards programs” to see what others are doing.

7.  60% of Internet searches are for local businesses.  If you don’t have a Web site, get one.  Get a .com domain name from GoDaddy.com; then use the free Web site builder from MS Small Business.  Micro Soft actually has reduced the price of their lowest cost site to $0!  You can upload photos, have a shopping cart, and do business on the Internet.

8.  The final tip for today: Consider buying another business/competitor if you lack critical mass, have excess capacity and need additional customers, additional market share.  There are some excellent bargains out there right now.  As a variation, is there another similar business you could partner with to cut overhead, to add efficiencies, to expand your product line?  Think creatively!!

Dick McCormick   Biz Success With Less

For more business success tips, go to BizSuccessWithLess.com

Tips for Tough Times I

The next several posts will offer some tips for small business owners to help survive this tough economy.  List ALL the ways you can save money, even the little ones – they will add up to significant savings over time. Get out a pen and paper and start making that list today!

1.  Use financial ratios (your own past ones or industry standards) like gross profit ratio to better understand your situation.  Ask your accountant to advise on key ratios and then calculate monthly.

2.  Review ALL your overhead expenses – begin making moderate reductions NOW, especially if you are experiencing increasing costs and declining sales.

3.  Factor your receivables.

4.  Delay or cancel any expansion plans.

5.  Pay your invoices early if your supplier offers 2% discounts within 10 days.

6.  Reduce energy use by changing your thermostat, turning off any lights and equipment when not in use, perhaps reducing business hours where it wouldn’t hurt sales or customer service.

7.  Manage you inventory better by keeping only those things you really need in stock, whether supplies or products for sale.

8.  Look for ways to trade goods and service with other businesses to reduce cash flow.  But remember, bartering is taxable at fair market value.

9.  Evaluate and better manage your logistics by combining trips, using your best-mileage vehicle, etc. Also, keep your tires inflated properly and your engine tuned up (esp. filters & plugs).

Look for more tips in coming weeks.  EVERY LITTLE bit helps.  Start today.

Dick McCormick      Biz Success with Less

For more busines success tips go to BizSuccessWithLess.com

Wonderful Free Websits to Start & Grow Your Business!!

This post will be short but packed with three great resources to help you start and grow your business.  If this economy is getting you down, look these up!  These are ones I refer my clients to.

www.SBA.gov. On the top under “Small Business Planner” click on “Manage Your Business.”  When you get there, click on “Market and Price” on the right sidebar.  Here is an entire marketing course with about 15 topics on marketing and advertising.

www.SCORE.org. The Service Corps of Retired Executives is actually a part of the SBA.  Click on “How-to” on the left sidebar.  There are sections on “Starting Your Business,” “Growing,” “Financing,” “Technology,” “60 Second Guides,”  and more.

On the home page again, click on “Business Tools” on the left sidebar.  Then click on “Templates” which will take you to a 31 page business plan outline and financial templates which can help you get started and manage your business.

SCORE also provides mentors to answer your questions – the home page will get you connected with someone with your industry experience to offer helpful input.

www.sbcn.nc.gov. This is new and the home page for the Small Business Center Network of North Carolina.  There are 58 Small Business Centers attached to the 58 community colleges in NC.  Some great resources can be found by clicking on “Resources” (what else?) near the top of the page.  As you scroll down near the bottom under “Resources” you will find: “Business Plan Template,” “Business Self-Guided Assessment,” and “IRS Tax Center.”

But one of the most helpful sections is near the center of the “Resources” page, on the left: “Market Research.” Especially during these difficult times you need to be looking at your market demographics or developing new markets or products.  Good research is essential!

Dick McCormick Biz Success with Less

For more business success tips go to… www.BizSuccessWithLess.com

Offloading that “Administrational Detail” We Don’t Like

If you’re similar to me, you don’t like many of the operational details of running a business. I want to help small businesses prosper and help start-ups get started on the path to success; I don’t want to spend time on doing things I don’t like or am not good at and that don’t contribute to helping someone.

Most small business owners are so caught up in the day-to-day operational details of running a business (working IN the business) that they don’t take time to work ON the business, to do those important things that increase sales and profits.

For the past six months or so I have been writing a bi-weekly blog.  I enjoy the postings; what I don’t enjoy is the marketing implementation side (although I am good at marketing planning).  So… I am working with someone to see if we can find a cost-effective virtual assistant online to do the marketing.

There is an online service called elance (www.elance.com) which may just be able to provide what I want to offload, so I can continue doing what I like and do well.  All I can do is recommend you explore this service for yourself.  One elance site I have visited offers:

… This enables us to provide our clients with marketing and business plans, marketing collateral, strategic action plans, blog and ezine articles, creative writing, white papers, research, viral marketing, Internet marketing, client contact management, project management, sales training, bookkeeping, creative thinking and so much more.

As I was thinking about today’s post, the only business book I’ve purchased in the last 18 months came to mind: “The 4-Hour Work Week,” by Timothy Ferris. It is fascinating and highly practical.  Chapter 8 is “Outsourcing Life – Offloading the Rest and a Taste of Geoarbitrage.”  The point of the chapter is that you can hire a virtual assistance to do those things that your don’t want to do or that take up too much time, those things that rob you of the precious time to work on those bigger and better things. On page 119 Timothy states, “The Indian outsourcers cost between $4-10 U.S. per hour.  My domestic outsourcers are paid on performance or when product ships.”  (The book was published in 2007 so I’m sure prices have changed some.)  There are other countries providing on-line services. Virtual assistants can do virtually any administrative task from prospecting for clients to keeping your calendar to market research.  “Don’t limit yourself.  Just ask us if something is possible. …  What can we not do?  We can’t do anything that would require our physical presence.  But you would be surprised as to how small a set of tasks that is in this day and age.”  (Quote from one of the VA providers profiled in the book.)

Whatever you do, do your due diligence on the person/service before committing too much to them.  Give them something small to see how they do and work up from there.  But, I do highly recommend the book for the detailed outsourcing how-to information and for the other great strategies and tips for getting more out of life with less work.

Dick McCormick – Biz Success with Less

For more business success tips, go to www.bizsuccesswithless.com

What, Start a New Business in this Horrible Economy??!!

There are many reasons not to start a business given the horrendous problems currently facing our economy. But where some see problems, others see opportunities. Since “recessions” are geographical in nature and may be industry specific, what may be failing in one area of the U.S. may be thriving in another area. This is true globally also. Here are several national examples to consider:

1) Hurricane Gustav was devastating and a tremendous blow to Texas especially. But it will require many players to help rebuild.

2) The U.S. auto industry is reeling! But in the midst of it, Telsa Motors has begun a new automobile company – building an all electric sports car.

3) Many of our large financial institutions are on the ropes, which leaves opportunities for others to greatly increase market share.

4) With oil so expensive, alternative forms of energy production are coming on line. And, people are vacationing and recreating much closer to home than before.

So, how do we take advantage of opportunities that may present themselves?

• Is your/an industry suffering? Are there any special niches that are under-served right now? How could you alter a product or service to deliver what customers want NOW? How can you reduce costs by introducing systems which will deliver products or services more effectively and efficiently? What competitive advantage might allow you to capture a significant segment of the market?

• What is happening in your particular city and surrounding area? What opportunities do you see? What needs are not being met? What expectations are going unmet? Look around, observe, listen locally to what people are saying, what the news media are reporting. You could do this on a regional or national scale also.

• Consider long-range implications. Things are definitely not going to ever be the same again. Sit down and brainstorm with some close friends: Think through and evaluate some most-likely scenarios. What are possible outcomes given the present circumstances? What opportunities do these present?

As I write this, several things come to mind: Logistics (faster, more efficient ways of moving and storing goods), outsourcing from larger companies (to allow them to focus on their core competencies), innovative technological applications (improving system and process efficiencies) – these are just several examples of possibilities to consider. When others are pulling back, go ahead and accept some risk, take a chance, but not before you do your due diligence!

Dick McCormick – Biz Success with Less

For more business success tips, go to www.bizsuccesswithlesss.com

Know How to Refocus to Meet New Market Realities

Yes, we are in an unusual economic environment with a major slowdown in the economy, global competition becoming more and more intense, generational differences creating new market opportunities, the Internet displacing more traditional marketing strategies. But, change is a constant and happening all the time. We need to keep up on the changes in our marketplace, in our industry, with our competition: What do these changes mean for me and my business??!!

Don’t hide your head in the sand and continue to believe things will be the same month after month:

• Especially track your customers’ needs, wants, desires, satisfaction.
• Keep a close eye on your metrics: your financials, your product statistics, the numbers that show how you’re doing.
• Read the USA Today, Business Week, Inc. and other business publications daily, many of which are free online.

All of the above-named factors and MANY more will force us to redefine our core business. What do all of these point to for your business? What are the opportunities these bring to the table? What are the options for YOUR business?

Take a close look at your Core Assets, what your company does extremely well? Do an in-depth evaluation with all of your associates and your customers to identify the obvious ones and those which may be hidden below the surface. Where do you shine: Production, Research and Development, Marketing, Sales, Innovation, Graphic Design, Consulting, Logistics…?

• Do these match up with the new market realities?
• Can you take advantage of these core competencies/capabilities to move out in a new direction?
• Can you add new products and services to your existing business?
• Can you reach untapped market niches, customer segments, new geographic markets?
• Can you market your products and services in innovative ways to increase market share?

Chris Zook in his book Unstoppable states: “It all sounds so logical, and yet the majority of companies that attempt to redefine their core businesses don’t succeed. … It’s just a matter of shifting focus – talking to customers, looking for new ways of differentiation, and seeking fresh product perspectives. These will get you back on the road to growth.”

Don’t just stop here and go on with your daily activities. Take 15 minutes, think about these issues, and write down what you will now do. Develop a simple goal and a short Action Plan to move ahead.

Dick McCormick – Biz Success with Less

For more business success tips, go to www.BizSuccessWithLess.com