12 Tips for Profits to Keep Your Business Dreams Alive

 

Most businesspeople agree the economy continues to be challenging. Signs of a lingering downturn are everywhere. Business activity is slow. Governments at all levels report low tax revenue and are restructuring, and not spending. Customers want you to cut prices.

With a high level of oversupply in many industries, high unemployment and reduced customer spending, many businesspeople face a highly competitive environment.

To keep your dream alive in this downturn, you must find ways to adapt and do it quickly. That means re-examining business plans, strengthening risk management initiatives, retaining top talent, and making internal changes and restructuring to increase efficiency and profitability – all while looking for new opportunities for growth.

How to improve your business position:

1. Be defensive. Protect your turf by taking the best possible care of your best customers. You can invigorate sales with customer retention strategies. Find out what they think of your company, and make necessary improvements. You might consider jettisoning high-maintenance customers. Upon careful review, you might find they’re not profitable for you. You don’t want to be in a position where you’re just moving money around.
2. Expand your customer base. By surveying your best customers, you’ll probably get some compliments. That’s a perfect opportunity to ask for referrals. Find low-cost ways of rewarding them for referring their associates, relatives and friends to you. Here are sales and networking strategies to build strong relationships.
3. Invest in your future. Keep your productive marketing going. Train your workers. Take advantage of innovations in technology. Consider the 11 strategies to keep your business floating above water.
4. Develop an employee-loyalty program. Make it a fun working environment. Even if you can’t give raises, learn how other businesses are successful in retaining their best employees.  Learn which employees are most-likely to quit. Be transparent with them. Explain your challenges and how they can help, especially in processes and with customers. Note the strategies if a valued employee wants a raise, and money’s tight.
5. Fine-tune your branding. The Eight Best Practices in Small Business Marketing. The key to remember – customers want value. Think 1930s for business success. Consumer attitudes are changing.
6. Give back to the community. Did you know that cause-related marketing can increase sales by double digits?
7. Review your pricing strategy. Determine how to get more return on your sales. There are eight simple strategies to give you pricing power.
8. Use best practices in managing your financials. If you’re struggling, here are the step-by-step solutions for a company turnaround.
9. Be creative in your receivables. If collections are a challenge, here’s how to ease debt-collection headaches.
10. If you’re small, make it work for you. Remember  size doesn’t matter but image, professionalism count.
11. Do your best for the environment. Eco strategies work with customers. Here’s a checklist for branding, selling your biz as green.
12. Become an innovator. You must constantly evolve. Here’s how successful companies innovate. Once you are running on all cylinders, consider buying your competitors – providing, of course, you can manage them.

From the Coach’s Corner, if you’re really in a survival mode, here’s a six-part series with tips on “Surviving Economic & Industry Downturns” for your Downturn Survival.

“Nobody talks of entrepreneurship as survival, but that’s exactly what it is and what nurtures creative thinking.”

-Anita Roddick

 

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Columnist Terry Corbell is also a business-performance consultant and profit professional. Click here to see his management services (many are available online). For a complimentary chat about your business situation or to schedule Terry Corbell as a speaker, why don’t you contact him today?

After Taking Us for a Ride, A Vacation Is Warranted for Obama

 

Aug. 20, 2011

Frankly, I don’t understand the brouhaha over the Obama family’s vacation, decadent or otherwise. Critics who called on President Obama to cancel his Martha Vineyard vacation have been misguided.

Aren’t they over-reacting?

True, the timing of his vacation could have been better. Much of the country is suffering. World markets are in chaos. A check of history does reveal other presidents have canceled vacations during similar crises.

The well-to-do location also raised eyebrows of consternation. For one thing, Martha’s Vineyard does not have racial diversity. Even the Tea Party has more racial diversity. More noteworthy, nor does Martha’s Vineyard have economic diversity. The average American cannot afford the $50,000 per week price tag of Mr. Obama’s favorite vacation retreat – not to mention the huge amounts of money paid for security.

In contrast, President Clinton went camping in Wyoming, President Reagan went home to split firewood, and President Roosevelt served hot dogs to the Queen of England. Those symbols of leadership inspired Americans during critical times.

The feeling of President Obama’s critics is that he advocates certain principles, but his actions speak differently. I concur.

By now, you realize the headline and lead paragraphs in this piece are facetious.

No, I’m not a Republican. Nor am I a Democrat. As a Biz Coach columnist, count me also as an average American with a Cherokee Indian heritage, an Independent and a champion of the underdog — someone who is deeply worried about the direction of this country.

The spending is out of control. The risk of a double-dip recession is quite high. So what do we get now? We get an ill-advised bus-PR gimmick with only hints about a new jobs plan.

Yes, Mr. Obama’s bus tour has really taken us Americans for a ride — an abysmal, bumpy ride. As a former columnist at Belo Web sites and one who supported his small-business platfom during his campaign —  a Biz Coach column followed by a press release — I feel betrayed.

Incompetent economic policies

Actually, since his inauguration, President Obama has been leading us astray. Instead of focusing on the faltering economy, he gave us a dysfunctional health law, which has been one of the reasons small business has not hired workers. He advocated a plan to confiscate your retirement funds. And don’t forget about his unproductive environmental policy in Cap and Trade.

As a result, a recent Gallup Poll indicates Mr. Obama has a 26-percent rating for his handling of the economy. Americans aren’t confident about his policies with good reason – the policies and Americans aren’t working.

His rhetoric has suggested he will deliver an effective policy to create jobs and to ease the onerously high unemployment rate. He’s been wrapping himself in the American flag – issuing an ultimatum to opponents to support his secret jobs plan. He implies opponents of his ineffective policies are unpatriotic. Sure.

His bus tour was another indicator of incompetence – the type of economic-policy ilk that Americans suffered under President Carter. To state Mr. Obama is providing leadership is in reality an oxymoron. His so-called leadership is leading us down the wrong road.

The two Darth-Vader looking black buses cost $1.1 million – each – from Prevost, a Quebec-based manufacturer. Reportedly, the Secret Service made the purchase. If I were Canadian, I’d expect my government not to miss a chance to buy Canadian. Likewise, as a U.S. citizen concerned about jobs, I expect this administration to buy American.

Yes, it’s true all White House vehicles are black. However, instead of being a source for optimism, the black-colored buses are a reminder – the black mirrors the economy and morale of most Americans.

Obama behavior fails to match goals

For a president who claims he’s concerned about jobs for American workers, he’s committed a terrible PR gaffe – economically, environmentally and patriotically.

To send a message about job creation, appropriate action is indicated. But it’s not happening. No one will convince me that American bus manufacturers are incompetent. There’s at least one American bus manufacturer that’s able to meet security requirements to protect a U.S. president.

In fact, a cursory search on Google reveals three interesting American bus manufacturers:

1. Warren Buffett’s Berkshire Hathaway owns Forest River, a bus builder in Elkhart, Indiana – in business since 1903. Mr. Buffett just might have the resources to build such a bus.
2. General Motors Ventures LLC is investing $6 million in Proterra Inc., a well-known manufacturer of zero-emission buses. Locations: Golden, Colorado and Greenville, South Carolina.
3. How about American Coach in Decatur, Indiana?  Talk about a missed opportunity for PR. American Coach’s line of products: American Revolution, American Eagle, American Tradition and American Heritage. Any of the names would have been a PR coup of epic proportions.

(Note: If you work for a U.S. bus manufacturer excluded in this column, my apologies for my oversight. Please let me know. I’ll gladly add you to this list.)

One final example of Mr. Obama’s tone deafness: Not only did he miss an opportunity to put Americans to work building his buses, he missed another golden opportunity to show the No. 1 symbol of patriotism — the American flag.

There were no American flags anywhere on his buses. None.

So, I disagree with the critics of Mr. Obama’s vacations. I now believe he should enjoy long, decadent respites. When he’s not working, Americans are better off. They have a better chance of getting back to work.

From the Coach’s Corner, here are two resource links: economic analysis and short-term economic forecast.

You might also wish to read Does the Federal Reserve Understand Small Business?  Here’s a menu of other public policy columns.

“A major source of objection to a free economy is precisely that group thinks they ought to want. Underlying most arguments against the free market is a lack of belief in freedom itself.”

-Milton Friedman

 

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Columnist Terry Corbell is also a business-performance consultant and profit professional. Click here to see his management services (many are available online). For a complimentary chat about your business situation or to schedule Terry Corbell as a speaker, why don’t you contact him today?

 

Options to Navigate This Marketplace Bedlam

 

Part one of two-part series: “Solutions for a Roller Coaster Marketplace”

 

OK, it’s been a wild ride, right? Uncertainties regarding Wall Street and funding are setting off alarm bells. But if you’re looking for capital, there are reasons to hope, according to leading consultant Joey Tamer.

Ms. Tamer acknowledges that the wildly gyrating stock market and withdrawals of initial public offerings are top-of-mind concerns.

“…the change in IPO activity may be the most significant,” she writes in a blog post, “Will stock market chaos create venture capital downturn?”

“Venture capitalists are excited by a predictable exit market, either strong M&A (mergers and acquisition) activity or several powerful IPOs coming in the near future,” she writes. “If they believe they must wait for these liquidity events, or cannot predict when these will be active, the VCs will become more conservative in their choices, and protect their portfolios.”

Ms. Tamer is imminently qualified to comment. As a trusted source on this business portal, she’s a strategic consultant to entrepreneurs in software, internet, technology, and tech/media.

Having experienced five downturns, she recalls the trends from the last two recessions – patterns, which could repeat now.

She says the patterns include:

• Deals that were not completed at that time rarely were completed.
• VCs took, justifiably, defensive measures to ensure that their existing portfolio companies had enough capital to move forward on their growth cycle.  The VCs allocated much of their existing Funds to those investments already secured.  This left much less for “venturing” into new risks. And the VC’s return on investment (ROI) on their portfolios was threatened, and that ROI is the basis of the VCs being able to raise their next Fund and so to survive.
• VCs became more conservative in the risks they would take.  On my various VC panels in the tech industry (Digital Hollywood, CES, and others), they admitted (this was 2008 and early 2009) they were “broadening their early stage searches” to include those startups that had revenue and market traction.  This criteria became a standard, leaving seed and Series A capital more and more to angel investors and angel groups.
• Deal terms became more aggressive against the entrepreneur, to protect the VCs from potential downside.
• Years of limited capital drove entrepreneurs to bootstrap their companies (since there weren’t jobs for them anyway) and get their companies into a much safer stage once the capital began to flow again.

Ms. Tamer cautions “the cycles of boom and bust are coming too close together.”

Specifically, she warns:

• After the downturn of 2000/2001, the VCs didn’t get truly active again until 2004.
• The next bust was 2008, with investment beginning again in 2010, and more actively in 2011.
• Three to four years of an active investing cycle is not enough time for entrepreneurs to recover from these downturns, especially if the uptick in investing lasts only 3 years going further.  This cycle stresses the VCs and their new Funds as well.
• VCs are handling portfolios with an exit cycle of 6-8 years from funding.  Entrepreneurs may launch and get traction in 3 years after funding (which means 4-5 years after they begin the company), but they are rarely scaling until year 4 post-funding.
• Notice the age of the potential IPOs — up to 8-10 years to build value and find a good IPO window (perhaps now closed again).

But as a knowledgeable veteran strategist, she knows fear leading to procrastination is unproductive for entrepreneurs.

I agree and often use two acronyms in illustrating the dangers of yielding to FEAR:

• “Frantic effort to avoid responsibility”
• “False evidence appearing real”

So, Ms. Tamer offers these strategies:

• Keep building your companies, your technologies, your breakthroughs.  Who knows what will happen next week or next month?
• Consider alternative forms of funding — private funding for an idea re-conceived for this new economic reality; strategic funding from a win/win bigger company that needs what you have; licensing and strategic revenue and no equity or debt funding at all;
• Consider a different take on your product or service idea, or your target market sector, or your market timing, and create a company that builds wealth for you independent of the vagaries of the stock market and other people’s ideas about capital, risk and what is real. This is my favorite kind of company to build.

See 6 Values for Financial Protection for part 2 of this two-part series: “Solutions for a Roller Coaster Marketplace.”

Ms. Tamer’s Web site and blog: www.joeytamer.com.

(Note: I highly recommend Ms. Tamer. She and I met several years ago via Consultants West, a roundtable of veteran consultants and authors, www.consultantswest.com.)

From the Coach’s Corner, be sure to read Ms. Tamer’s opinions on other topics:

10 Characteristics of a Successful CEO

Surviving Economic & Industry Downturns  

What Should You Divulge When Asking for Investment Capital?

Eight Strategies to Consider Before Starting A Tech Business

“Do the thing we fear, and death of fear is certain.”
-Ralph Waldo Emerson

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Columnist Terry Corbell is also a business-performance consultant and profit professional. Click here to see his management services (many are available online). For a complimentary chat about your business situation or to schedule Terry Corbell as a speaker, why don’t you contact him today?

 

Tech Planning: What If There’s A Double Dip?

 

Pick any region. Most respected economists and other experts believe economic growth will be tepid, at best. There are continuing concerns about the world’s economy, and it’s important to ask a key question: Are you ready for a possible double-dip recession?

Certainly, many global economic trends are eye-opening. Here in the U.S., job-growth and the consumers’ inability to buy are major concerns.

Moreover, public policy at all levels – federal, state and county, and city government – is hurting the nation.

At the federal level, stimulus spending that totals more than $1 trillion has been inefficient. Relatively few jobs are being created and there are constant calls for more spending. Policies are detrimental. The healthcare reforms are anything but productive. The legislation created 19 new taxes, it lacks cost-controls, and insurance premiums are mounting.

For years, state and local governments have been fiscally dysfunctional, too. They are still increasing taxes and slashing services.

Businesses are disappointed. Many lack an incentive to invest in human resources, marketing and technology.

The aggregate impact: A further deterioration of Americans’ financial and political freedoms.

So, it was not a surprise that technology-research firm Gartner recommends in a study that chief information officers should get ready for another downturn. That requires planning.

Authors of the study, Plan for a Second Recession, Now, wrote: “We urge these CIOs to leverage their recent experiences by preparing their enterprises should another economic downturn occur within the next 12 to 18 months.”

Gartner believes it’s important that CIOs communicate closely with senior company executives on priorities. Which IT projects for the next 18 months could be postponed or even disregarded?

My sense is that very function or project should be comprehensively studied and any spending should be approved. The budget needs to be detailed and every item needs to be justified. That’s called zero-based budgeting.

Just to cover all the bases, your department’s finances need to be constantly reviewed.

If your company is in dire financial straits and is attempting a financial turnaround, it’s also important to understand the perspectives of both the senior executive and the chief financial officer.  There must be a daily review in the form of a flash report. A flash report can be designed to monitor indicators on a daily basis and to evaluate your actual performance against the turnaround plan.  For more reading, see Step-by-Step Solutions for a Company Turnaround.

If a poor relationships exist between IT and the finance department, which is often the case, it’s important to understand the CFO mindset. You might want to read: Tech Trends: CFO’s the Boss, IT Departments Are Disappearing.

Good luck. Start planning and strap in the proverbial seatbelt if the roller-coaster ride proves to be harrowing.

From the Coach’s Corner, if you’re thinking about getting into business for yourself, I’d recommend reading: Eight Strategies to Consider Before Starting A Tech Business.

Not convinced about economic conditions? Here’s an eye-opening headline: Gartner Trims Worldwide IT Spending Growth Forecast to 3.9 Percent.