Category — Small Business Advice
It probably won’t come as a surprise that managing cash flow is perhaps the biggest concern small businesses and entrepreneurs face daily. Regardless of the size of the company, or where it is along its stage of life, every business owner is burdened by the time consuming issue of cash flow management.
Given the state of today’s economy, with customers extending credit terms and taking longer and longer to pay, this is likely the most pressing concern for small business owners everywhere. However, there are solutions to managing cash flow. There are ways to mitigate its impact and free up valuable time so that small business owners can get back to concentrating on what they do best. These approaches are simple, straightforward and can be used in both good and bad times. In fact, they become one of the most important aspects of growing a business and increasing gross profit. Interested in knowing what these approaches are?
Pursue Prepaid Customer Accounts with Bad Credit
Every day an invoice goes unpaid is a direct cost to the business owner. Since most businesses use business credit lines or loans to finance their day to day operations, they must pay a yearly interest rate to borrow that money.
When customers take too long to pay, not only is it difficult on cash flow, but there’s a cost to it as well. One of the best ways to alleviate that cost is to get paid faster. The easiest way to accomplish this is by selling product to bad credit accounts who must prepay before receiving product. Prepaid customer accounts are excellent sources to alleviate cash flow as they are rarely pursued by the competition.
Incentivize Early Payments with Discounts
Don’t just go after those customers who must prepay, use incentives with the best customers to get them to pay sooner. Provide discounts and prompt payment incentives across all customer accounts. This will incentivize these customers to pay sooner and help in managing cash flow.
Negotiate Discounts for Early Payments with Vendors
Be sure to secure discounts for prompt payments on your own invoices. When cash flow isn’t a concern, make sure to benefit from the savings accrued by paying your vendors sooner. It will help over time and keep more money inside your business. Managing cash flow is really about saving money when possible and this is an excellent way to keep more of your company’s money.
Managing a company’s cash flow can not only be frustrating, but a drain on resources as well. However, these simple approaches not only reduce its impact, but point the way to additional savings. They are used by a number of companies who view them as best business practices.
August 30, 2010 No Comments
Often times small businesses battle with finding cheap marketing ideas. Small businesses need to gain more profit, but need to be able to put out money for marketing. How do you find marketing money when you’re barely clearing the bills? Here are 3 ideas to turn pennies into large profits.
Flyers can be created for just pennies a piece. While people don’t always like to find flyers under their windshield wipers, they do like meeting business owners. Face-to-face time with customers is a great way to draw in business. If feasible, get out door to door in neighborhoods around your business. Once you have a chance to meet the people, leave them with a flyer. They will remember meeting you and have information to look over long after you have left.
Events and Open Houses
Through a special event. For example, during Halloween season, you could throw an open house. Rent an inflatable jumper, have things for people to do, refreshments and offer a peek at what you do. If you offer a service, have a demonstration on hand that plays over and over through the evening. Free events draw crowds. Events do not have to be expensive and can be done for less than an ad in the mainstream newspaper.
Mailers for After Hours Sales
Pick a section of town that you feel would be interested in your business. For example, if you have a specialty furniture store, pick a high dollar retirement neighborhood. Then send out exclusive invitations to them for an after hours sale. You can even print up the invitations yourself. Treat the invitations with as much class as a wedding invitation. You can pick up inexpensive gold lined envelopes, black ribbon and gold confetti from any office supply or even some dollar stores. Then have your staff dress the part. Serve punch and cookies on a table with real linens. Your customers will be surprised at any detail you give the party.
Marketing does not have to be expensive, it just has to be personal. Hand made invitations to events make for cheap, one-of-a-kind money-making marketing. Special events draw crowds that may not have been to your shop before. Flyers, when handed out face-to-face are a unique way of getting your face and business out to the public. People like different, personal marketing. There are a number of cheap marketing ideas for small business. The only thing that limits the ideas is your imagination, so get thinking and get creative.
August 23, 2010 No Comments
There isn’t a single part of American commerce that doesn’t have its inception at some point with a sale. Despite this, the function of sales and sales management is probably one of the most neglected aspects of a business. This is hard to understand for two reasons, first, because sales is the literal public personality of a business, and second, because sales is the driving force behind any growing business.
When a business is small, it’s usually not hard to for the CEO or President of a firm to be the lead (or only) salesperson. After all, he or she is often the one most intimately familiar with the business or product. And for a small startup, that person may even be the only person employed by the firm, making their sales efforts indispensable to success.
As a business grows, however, this personal approach to sales can become impossible, making a sales person or an entire sales force a necessity. Unfortunately, many entrepreneurs and managers have little if any experience in a personal selling or sales management role to address this. As a result, they tend not to consider it too carefully when making their marketing plans.
Sales is considered by many to be the “sharp edge” of the business process, and for good reason. Not only is it necessary for the creation of revenue, but it is also one of the largest investments made by a business. A single salesperson or a team of salespersons that have little idea of which products or which groups of customers to concentrate on, have too little knowledge of competitive activity, do not present the business well, or don’t close sales, don’t pay, they cost. Even worse, a situation like this means they are not managed well.
A recent survey on the effectiveness of sales representatives showed that an average of two visits for a salesperson was needed before a sales decision, whether positive or negative, was made by a client. This truth shows how important those communications are, and how much good salespersons can be to the future of a company.
If your company is not gaining the sales revenue you expect, it might be time to not only look at your overall marketing plan, but to look closely at the attention paid to visits by each salesperson to maximize their effectiveness. After determining whether a salesperson is effective or not, a decision can be made as to whether a larger sales team is justified.
August 16, 2010 No Comments
The General Services Administration (GSA) procures all of the goods and services used by virtually every other Federal agency. It holds contracts for items ranging from office supplies to airplanes. GSA monitors all federal contracts for compliance with federal purchasing regulations, including the percentage of contracts awarded to small businesses such as yours.
GSA’s Office of Small Business Utilization works on behalf of small, minority-owned, disadvantaged, veteran, and service-disabled veteran businesses to ensure that such businesses have equal access to federal contracts. Small business technical advisors work in the national office in Washington, DC. Small Business Utilization Centers are located throughout the United States, including Chicago, Boston, Denver, New York, and San Francisco, to name a few.
The regional offices provide a variety of services geared towards helping small businesses succeed. Procurement networking sessions, roundtables, and interagency networking breakfasts provide small businesses the opportunity to network with one another and with federal agencies that may be interested in purchasing their products. Marketing strategies and techniques workshops offer valuable and viable suggestions to help you run your business.
The Office of Small Business Utilization also operates the Center for Acquisition Excellence. This on-line academy provides procurement training on your schedule. The courses are offered free of charge and can provide you with invaluable insights regarding your business. The “Using GSA Schedules” course teaches vendors and customers how to use GSA schedules. Schedules are complex contracts containing a multitude of vendors selling their supplies to Federal agencies. However, many of the schedules are not limited to Federal agency use. For example, many of the schedules are open for cooperative purchasing – a program in which state and local governments and select nonprofit organizations can access federal pricing through the schedules while eliminating the inherent costs associated with procurement. These non-federal customers can save thousands of dollars on a single purchase through the use of GSA schedules. After completing this course, you will be able to decide whether or not placing your business on a GSA schedule will help you generate sales locally. The “Governmentwide Acquisition Contracts” course teaches vendors and customers how to purchase technology and technology-related services through Federal contracts.
Finally, the Office of Small Business Utilization provides links to the Department of Defense’s (DOD) Procurement Technical Assistance Program. While GSA holds the majority of Federal contracts, DOD also contracts for many of its own supplies and services. The Procurement Technical Assistance Program will enable your business to access DOD contracting and subcontracting opportunities through Centers located throughout the United States.
August 9, 2010 No Comments
Reducing your carbon footprint can save your small business money in a number of different days. The carbon footprint of your small business is measured in the amount of carbon dioxide it emits in its usual course of business. With the increased public awareness of the effects of greenhouse gases, your small business can not only save money through the application of green technologies, but you can also reap the benefits of advertising that your business is eco-friendly.
Savvy consumers know that they can purchase their electricity from companies that are inherently eco-friendly such as those that utilize wind turbines or solar power or those that “buy back” their carbon usage through planting trees. These consumers will also choose your business over your competition if you can show the same concern for the environment.
The low-hanging fruit on the carbon footprint tree are the obvious things. According to the US Department of Energy, new lighting technologies can reduce lighting energy consumption by 50% to 75%. Replace fluorescent lights with either compact fluorescent bulbs or fluorescent tubes to maximize savings. Light-emitting diodes (LEDs) are tremendously efficient, long lasting, and emit a high quality of light.
Trade in your old electronics for new, energy efficient appliances. Many appliances qualify for an energy rebate at tax time. If you have a kitchen for employee use, consider purchasing a new refrigerator and microwave oven. Turn computers and lights off before leaving for the day. Set your computers for a short “sleep-cycle”. A computer will automatically go to sleep after a set amount of time. Set this time to the lowest setting, as the computer is more energy efficient when it is in sleep mode. Paint the walls a light color. Not only will it brighten the space and your mood, it requires less energy to maintain the temperature of light walls than dark. Set the thermostats at 72 degrees in the summer to save on cooling costs and reset them to 68 degrees in the winter to cut heating costs.
Does your business print marketing materials such as sales flyers, product leaflets, or newsletters? Consider going paperless. Not only will you save money on your marketing budget, but also you will be able to keep your materials fresh by simply updating your web site. In today’s Internet-based society, your customers will appreciate having all of your information at their fingertips, and they will appreciate your efforts to reduce your carbon footprint.
August 2, 2010 No Comments
We live in an online world. More businesses are offering e-commerce solutions with every passing day, and even for businesses that operate entirely offline, a website demonstrates legitimacy to customers. Faced with these realities, small business owners are sometimes intimidated at the thought of setting up a website. While the cost of web development is a one-time investment, monthly hosting plans often seem more threatening.
Fortunately, the majority of small businesses can avoid these fees entirely through the use of cheap web hosting. While hosing plans can be astronomically expensive, most baisc, cheap hosting solutions are perfectly adequate to meet the needs of small (and larger) businesses.
To establish a website online, one needs a domain and a hosting account. The domain is simply the website’s address. Anything ending with “.com,” “.org,” and any similar suffix is a domain. These can be purchased at domain clearing houses like GoDaddy. After you buy a domain, you’ll need a place to put it – you ned a place to have your site hosted. Basically, when hosting is purchased, it is nothing mroe than buying space on a computer.
Hosing is available from multiple companies. If you buy your domains on GoDaddy, you can buy cheap hosting there as well. Additionally, you could buy hosting at places like WestHost, FatCow, or HostGator. All of these hosting solutions are cheap (as low as $4 a month), and their service offerings are comparable.
A website’s legitimacy comes in part from its design and in part from simply having a recognizable domain suffix. Users browsing a company’s website have no idea what kind of plan the website is hosted under. As long as the website ends in a familiar domain suffix, the user gains the sense that the website is trustworthy and professional.
This approach is guaranteed to save a small business more money without sacrificing any quality in their online presence.
July 26, 2010 No Comments
Small business may be the heart of our economy, but anyone who owns one can tell you it’s hard work. Many small business owners do everything themselves, from janitorial duties to operations to marketing and accounting. If you want your business to grow, but your budget doesn’t compare to the big boys, what is a little company to do?
Have you tried networking? If you have never heard of this skill, there is no better time to learn than now.
Networking means getting to know lots of people, treating everyone with dignity and respect, and working together so you both benefit. It really is that simple. If you master this talent, you can build business exponentially.
How does it work?
First, be social. Attend business events, seminars, SBA training workshops–anything that offers you the chance to meet new people. It can even be a bowling night for you and your family so long as you also encounter new people.
Some are intimidated by the idea of having to actively seek out new acquaintances, but there is a simple solution in these numbers. Remember the code: 3-2-3. Meet three new people, learn two things about them, follow up three days later. There is no need to hunt for a new best friend; simply shake hands, exchange a few facts about yourselves, and then send an email or note later to say you enjoyed meeting that person.
Why meet all these people? Because you now have a network of contacts who do all kinds of things, know all types of information, and who can help you when you need it. Further, you are advertising your own business free of charge!
Now that you are expanding your network, you are getting to the heart of commerce. Most businesses keep tight budgets, and they can’t always write a check for what they need. This is the time to pull out your address book and see who can trade services or the occasional favor. You both get something you need, and you both keep your cash flow under control.
Last, seek first to give, and second to receive. People know the difference between working together and being used. Always offer help first before asking for it back.
Once you start, you will learn that networking is simple, fun and profitable. You might even end up with a few great friends.
July 19, 2010 No Comments
Online businesses and websites are getting free traffic from search engines every day. Search engine traffic is where you can find visitors who are looking to buy a product or service. For example, if someone was looking for the best prices on lawn mowers, they would likely type “cheap lawn mowers” or “lawn mowers on sale” into a search engine. That is the type of visitor that will likely buy a product. When websites rank for keywords that that indicate an users intent to purchase, they will see more purchases than when they rank for keywords that might indicate a shoppers intent to compare prices or features.
So how do you get your website to the top of search engines for phrases like “cheap lawn mowers”? Well you have to know how search engines work. Search engines will rank websites based on their authority. Authority will come from links pointing to a website. If a website links to your website, then you will have more authority with the search engines, thus, they will start to rank you higher in the results. The key is to get links with the correct anchored text. In the example, you would want the link to say “cheap lawn mowers”. This tells the search engines what your website or page on your website is about. They will then start to rank you higher for that phrase and other phrases that are similar to that.
What it boils down to is keyword anchored links pointing to your website. The more the better, and the better quality of the links the better. A quality link is one that comes from an authority site to your site. A link from a friends blog that has nothing to do with lawnmowers will not help as much as a link from the John Deere website would. John Deere has good authority with the search engines and is relevant to your website. The more quality links you can get, the faster you will rise in the search engines rankings.
If you are in a niche industry that has pretty low competition in the search engines, then you can get only a few links and probably rank well in the search engines. One way you can get links to your website is through article directories like:
Those websites allow anyone to post an article. In exchange for the free content you are giving them, they will give you links to your website. This comes in very handy because you can choose your anchor text of that link. The more links you have to your site, the higher the search engines will rank you.
July 12, 2010 No Comments
If your business isn’t on Facebook, you are missing out on a huge advertising opportunity. Facebook boasts over 400 million users. There is a good chance that your customers are logging into the social networking site everyday. When you create a Facebook Page you have an opportunity to reach new customers and connect to those you already have.
Go to Facebook Pages and follow the simple sign up procedure. It is free and very similar to signing up for a personal Facebook account. Once your account is activated, be sure to make your page by adding your logo and product images.
Now that you have your business page, you need fans. People become a fan by clicking a link at the top of your page. It is important that you have a personal Facebook page with a few friends. Become a fan of your own business page. Your friends on Facebook will see this on their news feed. They will be given a chance to become a fan. When they do, their friends will also see a message on their Facebook feed and will be given the option to become a fan. Additionally, you can send an e-mail to all of your business contacts letting them know that you are on Facebook. Putting your Facebook link on your business cards and website is another great way to gain fans for your page.
Facebook gives you an excellent way to establish your brand’s image. It is highly unlikely that your customers visit your website everyday. However, over 50% of Facebook users log into their account daily. Post a daily status and this will appear on your fan’s news feed. Use creative status updates instead of blatant advertising. For example, if you are a flower shop, post a status that says, “ABC Flowers carriers hundreds of different flowers…What is your favorite?” instead of “ABC Flowers 25% off today”. This will create an open discussion and people will think of your brand more favorably.
A Facebook business page is a free advertising opportunity. Your link will show up in search engines which means more and more people will be able to locate you on the web. In this competitive world, there are not many opportunities for this kind of exposure. Get on this trend now and watch your profits rise!
July 5, 2010 2 Comments
For owners of brick and mortar stores, keeping things from seeming stale can be difficult. One creative way of making the store appear new and fresh is by rotating stock often – bring those goods that may be on back shelves to the front. For instance, if you are in the clothing business, changing up the displays will create a new look and feel to the business. The same concept applies with regard to your Internet store front. Keep changing things up, switching around the product and constantly striving to have a fresh look – your customers will appreciate it and may even notice something that they missed the last time they shopped.
How do you know which products were rotated and when? It can be a daunting task to constantly be moving inventory and shifting products since most small businesses do not have the staff or resources to make things happen. There is a fairly simple recipe for the success of moving product if you have a brick and mortar store: color code everything (For those on the internet, Google trends may help you figure out what products should occupy that enviable spot on your homepage during certain times of year).
For instance, all products introduced in January could be coded with blue dots. When February rolls around, switch out products and color code those for February with red dots and so on. At the end of the year or a six-month timeframe, if the blue dot merchandise hasn’t sold, consider marking it down for “clearance” because the odds of selling it now are diminishing, especially if it is seasonal merchandise.
Change is a very good thing for any small business, especially when the perception of your customers is that your inventory is fresh and evolving. Change implies movement and folks like to do business with a company that is on the move.
If your small business cannot afford to constantly be introducing new goods and services, take heart! A little change in your appearance will dazzle your customers – just make sure to have a whole lot of dots on hand so you’ll know where you have been and where you need to be.
How do you give the appearance that your store is constantly fresh and provides a wide offering of merchandise?
June 7, 2010 No Comments