Adding On...

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Are you adding on to the services you are providing?

If you are a fan of Jeff Foxworthy you probably think of his number about McDonalds and their attempt to add the Hot Apple pies to people coming through the drive thru. Adding on to products and services can also have a negative cogitation because of the way some companies push extended warranties.

So why would companies push an add on even though it might be considered pushy by the customer?

Let’s take an electronics store for example. It may surprise some people that there is little to no mark up in electronics. A store selling a business laser printer may make anywhere from 2 to 10% of the sale of that machine. It is a big sale but it is not making a lot of money. Now if an extended warranty is added to the transaction that could be anywhere from 50% mark up or more, you can see why some companies can get really pushy about getting those warranties.

However, you as a small business owner is trying to build customer loyalty, so pushing products that the customer may not think is necessary will only alienate them and cause them to shop elsewhere.

So how do you get additional items added to the sale without upsetting the customer?

First of all, you need to use proper salesmanship. I have gone over sales presentations in the past and will refresh that information in the near future. You need to ask your customers questions and listen to their answers and they will tell you what they need.

Let’s use the example of selling a printer. Most printers do not come with USB cables because the manufacturer doesn’t make any more money building the printer than the electronics store makes selling it (the manufacturers make their money selling the ink).

One of the questions you can ask your customer is if they already have a USB cable and is it long enough. Another example is that they may tell you during the conversation that they will be printing brochures so a natural add on would be to ask them if they will need any brochure paper.

So how does this build customer loyalty? You are finding out exactly what the customer needs to insure that they do not have to turn around and come back to your store or more likely go to another store to get needed supplies. I cannot tell you how many times people came into my store and said they bought a printer and the salesperson never mentioned that they would need a USB cable so the had to come to our store to purchase one. Do you think they were happy with the salesperson at the other store?

There is other ways to get additional sales.

Service businesses can also benefit from this and since I have several friends who are professional photographers, I will use them as an example.

During my wedding, our wedding photographer mentioned to several families that he also takes family portraits. He ended up doing some shots of families at the wedding in addition to the pictures of us. Since he was already at the wedding, this extra business only cost him a couple of rolls of film.

If the photographer did one wedding per week, think about how much additional revenue he could make by just getting one family per wedding to do a portrait session.

Getting an add on to a sale not only can help your revenue but it can also help you build customer loyalty by ensuring your customer leaves your store with everything they are going to need in order for the product to solve the customers problems.

Also, be on the look out for additional ways to increase your revenue stream to make your business more profitable and successful.

Building Customer Loyalty

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How loyal are your customers to you?

The answer to the question could be what stands between success and failure of your small business. Today you see many major retailers trying to build customer loyalty through their so called rewards cards. It is the latest attempt to keep customers coming to their stores as opposed to their competitors.

But what can you do to create customer loyalty?

The Freelance Folder blog has several ideas to build your customer loyalty.

The first idea they mention is to add a human touch to your service. When is the last time your tried to call a company on a 800-number and have been totally frustrated with the results? Make sure that your customers are able to reach someone that can answer their questions.

While I have said it is OK to outsource some projects, you should never outsource anything that will affect the service that your customer receives. These days too many companies are outsourcing their customer service functions which in the long run will only harm the experience the customer has when they call.

An outsourcer can provide the same level of customer service that you can because it is your business and to them it is just another account.

Another important way to build customer loyalty is to take care of the customer no matter what. To often small businesses have return policies that are too restrictive and cause them to loose customers in the long run. While a return always hurt, a customer that is able to return a product without problems is more likely to come back and buy more than a customer that cannot return a product.

The best way to deal with returns is to set aside a certain percentage of your sales to compensate for returns. This way you are not being caught by surprise with a really big return that you are not expecting.

Building customer loyalty should be one of your biggest priorities. It will mean the difference in the long term future of your company.

Finding the right Web Hosting Service...

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The Start Up Spark has some great tips for small businesses on finding the right webhosting service for a website.

As the blog mentions, be sure you do plenty of homework before you decide who is going to do your hosting. For any small business price is going to be an important factor but you need to look beyond that.

Check to see what other small businesses are being hosted by the site and see what their experiences have been.

Also do an internet search of the companies name and you will most like find posting boards that talk about the service. While people on these boards tend toward the negative side, it will also alert you to issues that the company may have and that need to be avoided.

Also do not make your decision on what “free” items you get with your webhosting. I have seen webhosting services have all kinds of offer including free software but the free software is worth about what you pay for it. Do not use any of these free items to decide from one service over another.

Remember, your website is the first thing many of your potential customers are going to see. Make sure that you find the right web hosting partner for you and your business.

Overcoming Cheap Imports

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The Babe of Business has a good article on how you overcome cheap imports by showing value and quality.

This is another area were your network can come in handy. While your big time competitors have big money to advertise their cheap products, you can use your network to get the word out about your products and the value and quality they have.

For example if someone in your group hears that a customer is planning to head to store “A” to buy a product, they can inform them that your store has a better quality product on sale that will last longer and you can do the same for them.

What you must remember is that you are not selling to the majority who think they are saving some money by buying something for a couple of dollars less but are getting far worse quality. You are marketing toward those who can see the value for the dollar, that they will be getting a better product for there money.

This is why it is so important to stake out your niche and take advantage of it.

The Obama Stimulus Plan and Small Business

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The Obama Stimulus Plan and Small Businesses - Join Us for a Townhall Meeting

The Small Business Trends website has announced it will be holding a town hall meeting tomorrow at 3:00PM eastern time which will discuss the Stimulus plan and how it will affect small businesses around the country.

The townhall meeting is scheduled to last one hour.

I would encourage all small business owners to make the attempt to listen to this broadcast.

Networking and Marketing Partners

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In my last entry I mentioned how important it is to get the word out about your business and the importance it plays in the economy.

However, you also need to build a network that will not only help you and your business but also be beneficial to other small business owners. Look for small business owners that own complimentary businesses of yours so that you can work together to promote each other’s business.

As a small business owner you do not have the money to go out and plaster the television with ads like your big time competitors. Therefore you need to look at less expensive ways to promote your business and creating a network is the best, least expensive way to do it.

One of the ways to build your network is to check with your locally owned business association for complimentary businesses. If you do not have that type of organization in your area check with the chamber of commerce, SCORE plus friends and family that may have suggestions for you.

You should be able to find many businesses that compliment yours. For example if you run an appliance store, you could work with repair people, stores that sell furniture but not appliances, home decorators and so on. You can refer clients to them with them referring clients to you.

Make sure that you feel comfortable with the people you network with. If you do not feel they will provide excellent customer service, consider finding someone else because you are putting your reputation on the line with a referral and joint marketing. Also make sure that the referring and the marketing are a two way street. If you find that you refer many clients over to your network but you never see any referrals from them then look into it. Sometimes it could be that you just have more people to refer than they do but you also don’t want someone to take advantage of you either.

Networking is an important marketing strategy for small businesses. Be sure to network with complimentary businesses that will fit your niche and your comfort level.

Small Businesses will be the leaders

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Small Businesses Will Lead Us to a Better Future

It is amazing that 63% of people feel that Entrepreneurs and Small Businesses will lead us to a better future.

If you look at most of the troubles that we are currently facing you will find that either government or big business or more likely both created the problems that we are facing.

Considering that small business owners have been largely ignored not only by the government but also by the general population, it is nice to see they are starting to see the importance that small businesses play in the success of the economy.

Now you need to get the message out on how important small businesses are to the economy. While sometimes a chamber of commerce is helpful in getting this information out, many of them have very large corporations as their members so are not willing to alienate those large companies by putting the focus on smaller businesses.

What some areas are now doing is creating locally owned business associations that are designed solely to promote locally owned business and to get information the public about their importance. In Utah their are two organizations designed for this purpose. First is the Vest Pocket and the second is Buy Local First.

Buy Local First comes out with a directory of locally owned businesses plus also promotes their importance to the local community.

Small businesses are very important to the economy and now is the time to let people know. If you do not have an organization designed to promote your small business get together with other small business owners to get the message out.

Learn lessons from the failures...

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Previously I have discussed how important it is for you to know thy enemy and to keep appraised what they are doing right and wrong in order for you to be more competitive. However, it is also important for you to learn from those that fail since as the old saying goes "Those who do not learn from history are condemned to repeat it".

In the retail sector there has been many failures over the last year including such names as Steve & Berry's, Circuit City, Mervyn's and others.

Today I am going to give a couple of examples of things you can learn of what went wrong at Circuit City and how to use those as lessons in your own business. By studying your own competition including those who don't make it, you will learn valuable lessons to improve your business and insure the same thing doesn't happen to you.

Among the issues that Circuit City faces was the lack of a niche, customer service, and the layout of their newer format stores.

While I may start sounding like a broken record, it is critically important that you have your own niche away from the major competitors. In the case of Circuit City, it could not separate itself from its major competitor Best Buy. The only major difference between the two stores was that Circuit City eliminated appliances several years ago which seem to contribute to their problems, not help them. Otherwise, they seem to try to emulate Best Buy not set themselves apart from Best Buy.

Following up on their attempt to emulate Best Buy, Circuit City eliminated their commissioned sales staff a few years ago and put them all on hourly. At the time Circuit City said it got rid of the top of sales ladder because they would have wanted too much money and in my experience it was clear that they kept the mediocre people and that led to poor customer service.

Let me give you one of my personal examples. I wanted to buy and item and the only store to have it in my state was Circuit City (otherwise I would have gone to a local competitor). I walked into the store and immediately found it in a looked up case. There was two employees standing just a few feet away but neither one of them would come over to help me. Finally I went over to the customer service counter to ask for a manager in order to get some help.

Instead of coming up to the counter and helping the customer personally which should have been done, the manager calls on the phone, tells the customer service person to find someone to help me because he had better things to do. Finally someone did respond to the calls by the customer service counter and I got the item I needed.

Clearly Circuit City failed from management down to take care of the customer. While in many cases this could have been an isolated incident, I heard many similar stories from other people which showed that Circuit City was failing in this area.

Finally, Circuit City also had problems when it came to their new format stores. The last new Circuit City store to open near me was in their newest format and I took a drive over to check it out one day. While the store was nice and new, the whole layout of the store was confusing. There was one department that was spread over three different areas of the store. How confusing would this be to the average customer? Stores need to be logically set up so that people can come in to them and find what they need easily.

That is just three examples of what where major problems at Circuit City. These are valuable lessons to learn so that you do not suffer the same problems as they did.

Learn from your successful competitors and learn from the failures so that you do not make the same mistakes they did.

Know Thy Enemy...

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How well do you know your competition?

If your like many small business owners, the answer to that question is probably not well. Many times small business owners are so caught up doing their thing every day, that they forget to keep an eye out on what their competitors are doing.

In previous entries I mentioned how important it is to keep ahead of the competition, especially the big boys, but how can you do that if you are not keeping an eye out for what they are up to. Now I am not talking anything secret agent style here but hey if that is your style, have fun. The main thing you want to do is to find out what their stores look like, how well their employees are trained, how they price, and figure out how you can out smart them.

I would recommend you go out and visit each of your major competitors at least once a month. However, you should also not forget about the smaller competitors and visit them every few months to keep up on what is happening out in the world.

Often times the big players will send out people to shop the competition but they often will not visit locally owned stores because they don't consider them to be important. This can be a major advantage to you since you will know more about them than they know about you.

The more you know about your competition, the better prepared you are to be competitive and ahead of the them.

Email Clutter

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One of the worst villains in robbing us of our productivity is clutter, and one form of clutter that is becoming all too common is email clutter.

Much like the old snail mail, we get all kinds of junk emails and other emails that are not that important but take valuable time out of our day.

One of the ways I reduce email clutter is to route regular emails that are low priority directly to a special folder.

For example, I get a large number of emails from one source that I need to read but they are not a priority so I created a folder and any email that comes from that source is automatically sent to that folder so I don’t have to deal with it.

Another suggestion is to create an email account on one of those free email sites such as Yahoo, Hotmail, etc. Then anytime you sign up for newsletters or other low priority emails, you can have them sent to that email account so it does not clog up your important main account.

Also, create folders in your email system so that you can store emails that you want for either future reference or to read later. However, keep these folders to a minimum and only save really important emails. Otherwise the folder section of your email program will become cluttered just like everything else.

For more ideas check out the Organizing Queen.

Are you willing to put in the time?

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Wil Schoter is another small business blogger that I like to check in on now and again. Today he has a great entry that everyone who is considering starting their own small business should take into consideration.

When you first start your own small business you will not have a nice cushy 9 to 5 job. Starting a new business is going to take a lot of time and effort. Often it will just be you or a couple of people running the ship and you have to be there to nurture it all the time. If you look at the people who have been successful at starting small businesses, you will see that they often put in 16 to 20 hour days in the start up phase in order to get it successful.

That is one thing you want to consider especially if you have a family or don’t like to put in any more time than you have to. While in the long run the hard work will pay off, you have to ask yourself are you going to be able to make those kinds of sacrifices now.

This is another reason why it is so important to find a business that you will truly enjoy working at. You need to have the passion to see the start up times through so that you will see it through this phase and beyond.

Starting a business is not a full time job; it is a full time commitment. Are you willing to put the effort in?

Finding your Niche

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In my last entry I talked about staying ahead of the competition and the importance of having a niche. Since it has been some time since I talked about your niche today I will go over what a niche is and use an example to hopefully get your mind working on ideas to find the right one for you.

Basically a niche is the part of the market you go after.

Using the big retailers for example, Nordstrom’s niche has always been its customer service and return policy. People do not go to Nordstrom’s for low prices but for the service and the outstanding return policy. Target’s niche is being a step above Wal-Mart in quality.

Now look at the office supply market. The three major competitors are Office Depot, Staples and Office Max. So what sets them apart from each other? Well you could say that Staples with their “easy button” but many people don’t even remember which store that comes from. The problem with these three stores is that they are not separating themselves from each other so most people either shop at the most convenient location or the one that they have the best experience in.

So let’s assume that you want to open an office supply store and you have to figure out what your niche is going to be. First of all, if you are going to carry the same things the other three stores do you are not going to be very successful because there is no reason for people to shop at your store instead of the others except for convenience or if there is neither of the big competitors in the market.

Now let’s look at the three major areas of the office supply store and see where you can set yourself apart.

One of the big departments in office supply stores is electronics. However, consumer electronics is extremely competitive and there is very little money to be made in them. In fact you may sell a $500 all in one and make $20 dollars profit.

However, instead of selling the basic consumer electronics all the office supply stores sell, you could look at items they do a poor job selling and don’t have much of and that is higher in electronics. If you are looking for a good business copier, specialty printers, or other similar items, the big office supply stores just do not have the inventory or the ability to service this market. However, something you would need to take into consideration is that people who buy these items need excellent serving so how are you going to offer that?

While there may be more mark up in furniture, the big stores have the advertising dollars to pull people in. A majority of people rather get a cheap price than buy something quality by paying a few dollars more. But there is the market for quality and you may not sell as many pieces as the big boys, but you could go for a market that makes you more money in the long run. Once again people spending the money want service, what are you willing to provide? Design services? Set Up and building? That is something you would want to consider.

Finally there is the main office supply area of these stores. Once again you cannot compete by offering the same products they do and in general it is hard to look at having higher end products. However, if there is a big enough market you could consider selling the items that the other stores don’t carry in their inventory but have to order. You could find out from local businesses what items they cannot find in the big stores and work on bring customers in on those items plus having the everyday items.

What it all comes down to is what part of the market you are going to go after to set yourself apart form the competition. It does you no good to try to fight them head to head because you will loose. Find out what the customers need and what the big boys are not doing to satisfy their needs. The better you set yourself apart from the competition the more successful you will be.

What are you doing to stay ahead?

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One of the things we talk about to small business owners is finding you niche. Once you find your niche, does that mean you can sit back and relax? Of course not, because we live in a constantly changing world, and your business needs to evolve on a regular basis or your business will find itself behind the eight ball pretty quickly.

An advantage you have as a small business owner is that you can respond to changing trends faster than the big corporations. Take a look at lodging facilities, some smaller lodging facilities were far ahead of everyone else when it came to offering their customers Wi-Fi service. In fact some of the big chain hotels are still behind the curve when getting an effective Wi-Fi network set up in their facilities.

However, what are these smaller lodging facilities doing now? After all, the big companies are quickly catching up so the smaller places need move the bar up even farther to improve their customer’s experience.

It is no different no matter what business you are running. If you’re small owner you can move faster than the bigger competition but you must be ready for your next move when they start catching up.

So how do you stay up with the latest trends? Research, Research, Research, and when you have done lots of research you need to do more of it. Does not sound like a lot of fun but it is the only way to see what is happening out in the marketplace and to implement new ideas before the big boys catch on.

There are many places where you can research what is happening in the marketplace. Your chamber of commerce is a good source, SCORE, magazines, Google searches, and many others.

The question is, what are you doing to stay ahead?

Stamp out that Negativity...

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Last week I mentioned one of my favorite blogs, the Zen Habits blog. Today the article comes from another one of my favorite blogs which is the Positivity Blog with a new entry called 8 Awesome Reasons to Blast Negativity Out of Your Life, and How to Do It

Negativity is one of the biggest challenges we face. Negativity can poison us and keep us from achieving what we truly desire and deserve. It can also harm both personal and business relationships.

Think for a moment, what kind of people would you rather be around? Someone is always griping and complaining, or someone that has a positive outlook? Which one makes you feel better and which one brings you down?

A perfect example is my wife’s brother in law. While he can be a nice guy, he is so negative that after a while I just have to get away. As Zig Ziglar would say “they brighten up a whole room by leaving it”.

On the other hand, I had a manager one time that was always positive. Even when things were not going well you could always count on him to have a positive attitude and as we called him “the little ball of fire”. Guess what? Everyone wanted to be around him and the energy level of the store increased when he was present.

The Positivity blog has several suggestions to help you to keep your attitude positive so go over and take a look.

Thinking of Starting a Business?

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Is it a good time to start a business?

With many people worried about their jobs in the light of lay offs (my wife was laid off of her job in October), the idea of starting a small business sounds good to many. However, as the Start Up Spark points out, while it may or may not be a good time to start a business, you will have to work at it.

Sadly at this point in time too many people are willing to grasp at straws in attempt to find that perfect get rich quick scheme. The worst part of these schemes much like lotteries is that the people who can least afford it get involved in them.

The idea of starting your business is great if you know what you are getting into. It gives you the opportunity to set your own course and control your own destiny. You will be the one making the decisions and enjoying and dealing with the consequences of them.

What you should also know is that there is no easy path. Starting a business is difficult and is going to take time and effort to get it going.

If you do decide to start a business, go in with your eyes wide open and know that it will success will not happen over night, or in a month but will take time…

Are you Twittering?

Image by luc legay via FlickrSocial Networking has become a major way to promote your business and the Business Coaching blog talks about Twitter.

Twitter is one of the many forms of Social Networking that includes Facebook, My Space, and many others.

Twitter is relatively easy to use and a great opportunity to meet people. In Twitter you basically follow what people have to say and they follow what you have to say.

However, there is many on Twitter who just become marketing machines and all they do is inundate you with marketing and PR. There is a fine line that you need to be careful not to cross.

I have had many people follow my twitters only to check out their pages and it is full of self promotions and advertising links.

So remember, Twitter is an excellent opportunity to meet people. It is also an opportunity for people to find out what you have to offer. Just remember the social aspect of it and make sure you are not using it way to SPAM people.

When you set up your account be sure to include a picture, have a link to your website and additional contact information. Many people will check out this information before following people. Then follow some other people that you find interesting and before you know it, you will be a Twitter expert.

Being Creative.

Image by Getty Images via DaylifeOf the many blogs I read, one of my favorites is the Zen Habits Blog. It is always filled with good information that is designed to make your life better. Today's entry is called:

The Secret to Being Insanely Creative

So what are the secrets of being insanely creative? It is not that big of a secret and you probably know the answer already.

One of the secrets is setting goals. As Zig Ziglar says "How can you hit a goal you cannot see?". Goals must be specific, have a specific time period and most of all be written down. You must have daily goals that work toward your important long range goals. Sometimes it is hard to set those goals but it is vitally important that you have them.

Another important ingrediant is your relationships. Are the people you associate with helping you achieve or they are holding you back. Often times our friends can hold us back because subconsciously they fear that if you achieve your goals either you will not need them any more or they will be something less. While it is painfull to do, you need to seek out relationships that will build you up and not take you down.

So what are you going to do to unlock your creativity?

Back...

It has been some time since I posted to this blog. For the last year I was getting paid to blog on another network but that one has shut down so I will be reactivating this one. I will be doing some redesigning that I hope you will like and I hope you find the information of use.

Develop your business plan Part 6

Here is part 6 on the Developing your business plan series. Once again their is some good information contained in here.

Starting A Small Business Series: The Executive Summary

Although the Executive Summary is the first section of the business, it is usually the last part you will write because as the name implies, it is a basic summary of all the parts of the business plan and it needs to spark an interest in the reader to move on to the heart of the plan.

The Business Plan Blog had a great explanation of the executive summary so I recommend you read that to get a good idea on what you should have in it.