How to Win Over Your Customers in the New Year

By Gary Barzel on January 1, 2009 in Business Marketing, customer service | Leave a Comment

If you are like most small business owners, then chances are your ‘08 holiday sales were a bit lackluster. But don’t despair. By introducing a few changes in the way you operate your business, you can brighten your outlook for the new year.

As a follow-up to my previous post on creative marketing techniques, here are a few low-cost strategies to develop customer loyalty.

Tip #1: Promptly respond to customer inquiries.

Make it a priority to get back to your customers. When customers feel that they and their concerns are important to you then they will be more likely to give you their business. Even if you don’t have an immediate answer to an inquiry, you should try to acknowledge receiving a customer’s e-mail or voice message within 24 hours, and inform the person that you are looking into the request or already taking action on it.

Tip #2: Make sure out-going correspondence is clear, concise, and professional.

But… it is not enough to just respond to your customers, you must also pay attention to how you respond to them. Voice messages, emails, and letters should be clear and concise. The time for elaboration is either in person or when speaking to someone directly on the phone. Make sure also that any written correspondence is spell-checked and free from grammatical errors, and that the response is relevant to the inquiry.

Tip #3: Look for where you can give a personal touch.

Handwritten notes, special “birthday coupons”, personally addressed and targeted emails, and no-obligation follow-up phone calls, can make a big impression on your customers’ minds and will measurably improve your customer loyalty.

Tip #4: Reward repeat business.

Give your best customers preferential treatment, such as small coupons or rebates as well as flexible payment options.

Tip #5: Seek ways to involve your customers in your business.

Try to get your customers involved in improving and promoting your business. I cannot emphasize enough how important it is to talk to your customers. You can speak to them in person when they come to your business and ask them for suggestions, or you can ask them to fill out a quick questionnaire, or have a suggestion box. Here again follow-up is very important. Even if you do not end up using a customer’s suggestion, you should let him or her know that you considered it. You can also get customers involved in promotion by, for example, having them forward emails to friends in exchange for a discount at your business, or you could run contests for the best logo or T-shirt design.

How Small Business Owners Can Reduce the Stress of Laying-Off Workers

By Gary Barzel on December 25, 2008 in Business Economy, Business Trends, Human Resources, Invoice Factoring, Small Business Labor | Leave a Comment

In the face of a glooming recession, much of the business world has adopted a hang on mentality when it comes to their employees. Rather then having to go through the process of loosing and later replacing productive, experienced workers, many companies are doing whatever they can to keep their workforces intact. Currently, the most popular cost-cutting tactics include: establishing four-day workweeks, unpaid vacations, and flexible work schedules along with wage freezes and cuts in pensions and health care coverage.

 

But for many smaller businesses even these tactics are not enough to keep them from letting go of their workers, and that can put a tremendous amount of strain on the small business owner.

In a small business where connections to employees naturally tend to run deeper and are more personal, having to lay off workers can be a painful blow- both emotionally and psychologically. Moreover, having to loose employees can often signal the end of a small business (After all, wearing multiple hats can only happen when their are enough heads to wear them.)

If laying-off employees in your small business seems inevitable, then here are a few tips to help make the process less stressful- for you and your workers.

• Be open with employees about the status of your business and their job security. It goes without saying that letting go of workers is not an easy situation, and you can expect that your employees may not take the news so well. But the openness will ultimately be appreciated because it gives everyone time to absorb the message and make other plans.

• Create a game plan. By creating a strategy with clear cut goals and a process of reevaluation you will be left with a greater sense of control and well-being. Basically, you need to determine how your business will operate with a reduced workforce, including how you will spread out the responsibilities among the remaining workers, if your output change or be reduced, and how you plan on using the freed capital to cover expenses?

• Improve cash flow to spread out or delay layoffs. In some cases, it may be a good idea to try to “comfortably” spread out your employee layoffs or even delay them outright. You could do this by altering your cash flow. If, for example, your business deals with receivables, you may be able access tied up capital by factoring your outstanding bills of sale or applying for a merchant cash advance.

• Talk to other small business owners. Speaking to others who have experienced what you are going through or who are currently experiencing a similar situation can bring you fresh motivation, insight, and ideas. Either you can speak to any friends and family who own a small business, look up your local SCORE chapter, or join your local chamber of commerce to connect to other business owners. You could also join an online small business community, such as those moderated by the Bank of America, entrepreneur.com, or Cybershmooze.

Image credit: Notions Capital

5 Creative Marketing Strategies That Work

By Gary Barzel on December 18, 2008 in Business Economy, Business Marketing, Business Trends | Leave a Comment

With holiday sales slumping across the board and consumer confidence holding at all-time lows, some small businesses are finding creative ways to keep customers coming and buying. If you are looking for ways to revamp your marketing strategy without straining your budget here are five techniques that work. And as you can see from the examples that follow, for those who are prepared to be creative and maybe even a little off-beat, there could be a big pay off at the end.

1. Will It Blend. Create a viral marketing campaign consisting of catchy articles, blog posts, or videos.

Blendtec has been promoting the power and versatility of its line of blenders in a popular series of infomercials featuring Blentec founder Tom Dickson blending a host of unlikely items including: golf balls, an iPhone, the Wii remote, credit cards, and the McDonald’s Extra Value Meal. There are also videos featuring attempts to “blend” the writers strike or the political parties.

2. Heart Attack Grill. Find a way to use even bad publicity to your advantage.

The Heart Attack Grill was founded in 2005 by “Dr.” Jon Basso who unabashedly promotes his restaurant’s unhealthy menu. The Heart Attack Grill offers burgers called single, double, triple, or even quadruple bypass (depending on the number of beef patties), beer, hard liquor, regular soda, unfiltered cigarettes and french fries cooked in pure lard all served by a scantily clad staff of “nurses.” What could be better?

3. The Million Dollar Homepage . Find creative, low cost ways to to use widely available material and mediums to advertise your business: think body art (logo hair cuts, hand-stampers, fake tattoos), logo projectors, or…

Check out what one clever entrepreneur did. He created a page with a 1,000,000 pixels, and charged people a dollar per pixel to advertise. Not a bad way to earn a quick million!

4. Bottled Water Marketing Campaigns. Create a brand distinction even when the differences are small or nonexistent.

With high profile endorsements and grandiose claims about their product’s purity and contribution to good health, bottled water producers have successfully created a distinction between natural mineral water versus tap water in the minds of many consumers. And this image has persisted even as several bottled water producers were exposed for fraudulent claims.

Today, bottled water producers are further buffing up their brand distinction by supporting a variety of green initiatives even differentiating themselves from soft drinks.

5. The Mentos/Coke Geyser Video Contest. Get your customers involved in promoting your business. Request personal videos from your customers that show them using your products, giving them as a gift, or shopping at your store. Run contests for the best logo or T-shirt design or the best commercial.

A recent Mentos/Coke geyser video contest in conjunction with YouTube brought 150 contestants. Now there are about 10,000 videos with this theme. The contest also set off a viral frenzy as the videos were shared among countless people.

Soothing the Health Care Headache: 9 Ways to Reduce the Cost of Health Insurance

By Gary Barzel on December 11, 2008 in Business Economy, Business Trends, Human Resources | Leave a Comment

As our economy sputters along, the issue of health care has become a real headache. With the cost of health insurance on the rise amid a general push towards bootstrapping and business restructuring, businesses big and small are struggling to provide a decent plan for their employees, and those who have recently lost their jobs are coming to terms with the fact that they have lost their health benefits as well.

While health care reform is desperately needed, the appropriate change will have to be drastic and extensive involving many players such as the Federal Government, the health insurance industry, health care providers, and major hospitals. And the painful truth is that such change may be very far off.

In the mean time, there are several ways that you can cut your health insurance costs for yourself and your employees without giving up your coverage. Here are a few tips:

1. Be an informed consumer. Whether shopping for the lowest health insurance rates or looking up medical and hospital information, doing your research before making decisions can increase your chances of lowering your health care costs. To get several quotes online, check out eHealthInsurance.

2. Rely on the coverage of your employed spouse. An independent small business owner may have the option of employing his or her spouse. Certain medical expenses, such as premium costs, co-pays, and prescription drugs, can then be claimed as tax deductible under a health reimbursement arrangement (HRA).

3. Lower your level of health insurance coverage. By increasing your plan’s deductible amount, your monthly premiums will be lower, and the savings in monthly premiums could end up being more than what you spend out of your pocket. But keep in mind that for this option to work you should be basically healthy, and be careful that the out-of-pocket expenses are small enough for you and your employees to handle.

4. Set up a health savings account (HSA). An HSA is tax-free savings accounts for medical expenses. Both employees and employers can contribute to the account, and it must be coupled with a high-deductible health plan. With this method, the policy holder gets the necessary insurance coverage, while the HSA provides the means to fund the additional out-of-pocket costs on a pretax basis. The money in HSA can be carried over from year to year, and it is portable.

5. Offer a flexible spending account (FSA). A FSA allows you and your employees to set aside pretax dollars through payroll deduction to pay for eligible medical expenses. Unlike the HSA, however, the funds in this account do not carry over.

6. Live a healthy lifestyle. Seek free or low-cost advice on maintaining a healthy diet and following an exercise plan. Encourage your employees to attend wellness seminars and to avoid or reduce unhealthy habits, such as smoking. Take advantage of free health screenings at local clinics, hospitals or health fairs. In the end you will feel better, and that could mean fewer trips to the doctor.

7. Join a discount health benefits program. For a small fee these programs offer savings on prescription drugs, dental visits and other health services by connecting members with affiliated doctors, dentists, and health centers. In this way, a health benefits program can fill in any gaps in coverage from your existing health insurance policy.

8. Enroll in a group health plan. Small group health insurance plans cover between two and 50 employees, and the larger your group, the lower your premiums will be. Small businesses with only a few employees and self-employed individuals have the option of creating a group purchasing alliance with other small businesses and individuals. You can locate a purchasing coalition on your state Department of Insurance (DOI) website. (A list of state DOI websites can be found here.)

 9. Find a Subsidy. Low-income individuals and households or those with a disability, may qualify for low-cost health insurance through a state or federal program such as Medicaid or Medicare. Households that have children under the age of 19 should further look into the State Children’s Health Insurance Program, or SCHIP. Families who earn too much to qualify for Medicaid may still qualify for SCHIP. For little or no cost, SCHIP covers doctor visits, immunizations, hospitalizations, and emergency room visits. For more information, check out the Insure Kids Now web site.

Image credit: RogueSun Media 

Keeping Your Business Out of Debt

By Gary Barzel on December 4, 2008 in Business Economy, Cash Flow | Leave a Comment

As I scan the media these days, I often come across the personal accounts of people who were drowning in debt yet were able to pull themselves out and make their way towards financial stability. Since these people tend to be representative of the “average Joe,” the display of resilience and discipline is particularly inspiring.

But what about all the small businesses out there who are also struggling with debt? With consumer sales slumping across the board (yep, it’s official… we’re in a recession!), many small businesses are feeling the pinch.

And words such as, “debt consolidation,” “business restructuring,” and even “bankruptcy” are being thrown around like used tissues, without enough emphasis on what they mean for you and your business and without a clear way of evaluating your options.

In my experience, a small business’ financial stability can often significantly improve simply by making a few, relatively small changes in the way it operates. These changes broadly fall into one of three areas: cash flow, operating budget, and what I will call “outreach.”

Here are a few suggestions on how you can reduce expenses, increase efficiency, and cut back your debt.

Focus # 1: Your cash flow

Your cash flow is the flow of working capital that is taken in and given out of your business. It is effected by your accounts receivable, inventory, accounts payable, capital expenditures, and incurred debt. One of the biggest reasons why small businesses fail is that they are not paying enough attention where their cash is either going or being held up. The result is that they fail to recognize and react to an impending cash crisis. Here are some tips to improve cash flow:

• Use software to help manage your business. Many accounting software packages offer a full range of features, such as financial reporting, payroll management, and billing. Popular options include: Quickbooks or Peachtree. You can also check out the free open source programs, such as GnuCash and TurboCash.

• Create a monthly cash flow schedule. Many of the factors effecting cash flow, such as outstanding accounts receivable or inventory, do not show up on an income statement. A cash flow schedule is specifically designed to give you a clear picture of each component of your business and how it effects your cash flow so that you can project a future cash shortage.

• Look for ways to improve billing and receivable income. Make sure your bills are sent out on time and that late payments are accurately tracked. You can require that customers make an initial deposit when an order is taken, and offer small discounts to those who pay their bills quickly. You can also direct hard to collect receivables to a factoring company.

• Know where to get temporary financing. Set up a business line of credit or apply for a business cash advance so you always have access to capital when you need it.

• Track your flow of inventory. A lot of capital can be tied up in overstocked or unused products and supplies.

• Stay on top of your bills. You can negotiate with vendors for payment in 30 days or more and pay towards the end of the term.

Focus #2: Your operating budget

Take a look at your budget to see where you can cut costs and increase efficiency. Even minor changes may add up to big savings in the long run. Here are a few suggestions:

• Equipment purchases: Consider equipment leasing and financing instead of purchasing your equipment outright. You can alternatively buy second-hand or reconditioned equipment.

• Taxes: Make sure that you are maximizing your tax deductions. For more information, read this article, and here’s another.

• Outsourcing: Some jobs can be done more effectively, efficiently, and cheaply by people outside of your business. Popular jobs to outsource include: managing and creating web content, designing and writing marketing material, and handling minor administrative tasks, such as, data entry and answering phone calls.

• Bringing work in-house: On the other hand, modern technology is making it possible for small businesses to tackle jobs that were usually either handled by outsiders or by people specially trained for the task. For examples of this, check out bMighty.com’s Server How-To Center or HP’s line of low budget equipment and tools that allows small businesses to create professional-looking printed material.

• Business travel: Rely on telecommuting and webconferencing where possible. Search online for deals on cheap flights and hotel rooms, and be prepared where you can to be flexible. Alternatively, you can hire a travel consultant to do the work for you.

• Conserving resources: Bring in energy-efficient products, such as CFL light bulbs and energy star equipment. Incorporate resource-saving practices such as, shutting down computers when not in use, printing double-sided pages, using time switches for lights and air conditioning units, using GPS when traveling on the road, and not letting vehicles run idle.

Focus #3: Outreach

This area is a combination of marketing, with a focus on customer satisfaction and customer feedback. One thing that many small businesses have over their bigger competitors is the personal relationship they can maintain with their customers. Do not overlook this vital asset! Not only will it help you to increase sales, but it can help you to operate more productively.

• Focus on quality. The integrity of your products and services will form a lasting impression on your customers and can go a long way towards building customer loyalty.

• Ask customers for suggestions. Actively ask your customers for suggestions or improvements via surveys or personal conversations and then follow through on anything that can be implemented.

• Bring in CRM software. Several open source Customer Relationship Management (CRM) software options exist for small businesses, such as Compiere and SugarCRM. These applications allow your business to effectively manage and access your customer information and to use it to develop your customer relationships.

Image credit: faungg

Top 30 Excuses for not Coming to Work

By Gary Barzel on November 27, 2008 in Human Resources | Leave a Comment

Want to take a mental health day but are having trouble coming up with a good excuse? I scoured the web in search of the best excuses for not coming to work, and here are my top 30 finds. If by the end of this list you still need more inspiration, check out this site.

1. If it is all the same to you I won’t be coming in to work. The voices told me to clean all the guns today.
2. When I got up this morning I took two Ex-Lax in addition to my Prozac. I can’t get off the john, but I feel good about it.
3. I set half the clocks in my house ahead an hour and the other half back an hour Saturday and spent 18 hours in some kind of space-time continuum loop, reliving Sunday (right up until the explosion). I was able to exit the loop only by reversing the polarity of the power source exactly e * log(pi) clocks in the house while simultaneously rapping my dog on the snout with a rolled up Times. Accordingly, I will be in late, or early.
4. I can’t come in to work today because I’ll be stalking my previous boss, who fired me for not showing up for work. OK?
5. I have a rare case of 48-hour projectile leprosy, but I know we have that deadline to meet…
6. I am stuck in the blood pressure machine at Wal-Mart.
7. Yes, I seem to have contracted some attention-deficit disorder and, hey, how about them Skins, huh? So, I won’t be able to, yes, could I help you? No, no, I’ll be sticking with Sprint, but thank you for calling.
8. Constipation has made me a walking time bomb.
9. I just found out that I was switched at birth. Legally, I shouldn’t come to work knowing my employee records may now contain false information.
10. The psychiatrist said it was an excellent session. He even gave me this jaw restraint so I won’t bite things when I am startled.
11. The dog ate my car keys. We’re going to hitchhike to the vet.
12. I won’t be in today. My home is flooded and I’m currently standing on my dresser in my second story bedroom.
13. I have a bad case of diarrhea, gas, or food poisoning.
14. I am not coming in because I tried to dye my hair blond, but it came out green!
15. My dog is having puppies and I need to help her.
16. I won’t be able to make it to work today due to my Aunt flying in from ______________, you see, she has one arm and two pieces of luggage and really needs me to be there for her.
17. Don’t call, don’t write, don’t let anyone know what’s going on - take an extra week, or two. Then when you are ready to go back to work, just call up your boss and say…. ” Don’t pay the ransom - I escaped! “
18. I’m sorry I was late, I forgot to look at my watch!!!
19. I called in and told them my front door fell off my house!
20. I’m sorry that I’m late for work today boss. I stayed home to wait for the cable guy. Then I remembered that you don’t pay me enough for me to have cable. So here I am. 
21. Sorry I’m late, but I couldn’t get my car started. Boss: Why not? Employee: I was asleep.
22. Sorry….I over slept and I forgot to come in for the first day of work at my new job. Is it OK to come in tomorrow?
23. I’m sorry I am late, but it was foggy and I missed the building.
24. I can’t make it to work for the next couple of days , my leg’s in Kentucky. (He has an artificial leg)
25. I thought that I’d be more productive if I didn’t come in today.
26. I dropped my car keys in the snow and I’m waiting for the temperature to warm up so I can find them.
27. I can’t come to work today. My house is burning down and the fire engine’s blocking my driveway.
28. I won’t be in today….I’m calling in dead.
29. The blankets were too heavy for me to lift so I was stuck in bed all day.
30. I’m really just working from home for free!

Enjoy your day off!

Image credit: flickr user voicesbybrian

Handle With Care: Managing Employees Who Must Wear Multiple Hats

By Gary Barzel on November 23, 2008 in Business Economy, Business Trends, Human Resources, Small Business Labor | Leave a Comment

It is common among small businesses that employees learn to become expert jugglers who must successfully manage numerous, often unrelated positions and responsibilities. And as the current economic downturn continues to hinder sales and cut into profit margins, this trend is only getting stronger.

While combining positions may be a necessary step towards conserving capital and riding out the current economic climate, small businesses run the risk of employee burnout, high employee turnover, and a severe drop in productivity.

Thus, it goes without saying, that managing your employees when they must wear multiple hats demands care and caution.

So, here are a few ideas to keep in mind:

• Make sure the person’s responsibilities are clearly defined. Spell out exactly what your employee is expected to do, and make sure that each duty is fully understood by your employee.

• Create a mix of responsibilities that is doable. This may take a little fine tuning over time. You need to determine that the workload is not too high and that the positions go together.

• Try to make it fit the person. The additional responsibilities should be appropriate for the employee’s skills, talents, and personality. Don’t, for example, give an unorganized person a bunch of administrative tasks that demand organization.

• Be prepared to be flexible. Have in mind that this is a work in progress. You may need to reallocate or redefine your employees’ duties over time.

• Create an appropriate pay scale. Even though saving money is a priority, it is important that your employees do not feel that you are taking advantage of them by paying them too little. For tips on how to determine an appropriate salary, check out this article.

• Allow for and encourage feedback. Knowing how your employees are feeling is one of your best indicators of how well the new positions are working out. Make sure to check in with your employees continuously to see how they are managing.

• Make sure there is downtime. To avoid burnout, make sure that employees have ample break and vacation time.

With the right attitude your employees can stay happy and productive even if they will be working harder.

Image credit: flikr user: Party Pig

The Top 13 Most Influential Celebrity Entrepreneurs

By Gary Barzel on November 12, 2008 in Business, Business Trends | Leave a Comment

Does the daily grind of running a small business leave you feeling like you need a little inspiration? Here is a star-studded line-up of the most influential celebrities in business. Some of these pop icons basking in the limelight have used their personalities and business acumen to become successful business tycoons; others are savvy entrepreneurs who used their personalities and business acumen become celebrities.

I complied this list with the aid of a poll conducted by Youngentrepreneur.com earlier this year as well as the Forbes Celebrity 100.

1. Sir Richard Branson. With his boyish enthusiasm, this English entrepreneur has built an empire of over 360 companies belonging to his trademark Virgin brand. Branson began his business career at the age of 15 with the publication of a magazine called Student. In 1972, he opened his well-known chain of record stores, Virgin Records, that became Virgin Megastores and later zavvi in late 2007. Branson’s Virgin brand grew rapidly during the 1980s to include Virgin Atlantic Airways and expanded the Virgin Records music label. Recent endeavors include: Virgin Galactic where passengers can travel in suborbitol space, Virgin Comics, and Virgin Health Bank.

2. Bill Gates. Though you may question his future as an actor after his recent appearance with Jerry Seinfeld in a series of Microsoft commercials, it is well known that Bill Gates has played a pivotal role in advancement of personal computing. Gates is currently chairman of Microsoft, the software company he founded with Paul Allen. During his career at Microsoft he has held the positions of CEO and chief software architect, and he remains the largest individual shareholder with more than 8 percent of the common stock. He is also well known for his philanthropy. In 2000, he and his wife Melinda established the Bill and Melinda Gates Foundation, which is considered one of the largest charitable foundations in the world.

3. Donald Trump. Trump may be as well known for his bold, flamboyant, and extravagant style as he is for the success of his business pursuits. An American business executive, entrepreneur, television and radio personality and author, Trump is currently the CEO of Trump Organization, an American-based real estate developer, and the founder of Trump Entertainment resorts, which operates several hotels and casinos around the world. In recent years, his fame increased after the success of his reality television show, The Apprentice, that he both hosts and produces.

4. Warren Buffet. Buffet is one of the world’s most successful and well-known investors. Earlier this year Forbes ranked him as the richest man in the world with an estimated net worth of $62 billion. Buffet is currently the largest shareholder and CEO of Berkshire Hathaway and an avid philanthropist.

5. Oprah Winfrey