How To Use Your Small Business Advantages
Regulars line up outside the family-owned restaurant. I was recently talking to Eric Groves, CEO and cofounder of the small business social network Alignable, about the constant competition and tension between small businesses and the big brands, and in four words he captured one of the most important assets small businesses have on their side: proximity to the customer. He had some more excellent points, and I’ll get to those a little later, but I wanted to start with this one. Proximity to the customer is something that the huge corporations can never buy. They can hire firms to poll consumers and do marketing research from here to Timbuktu, but they can never be as close to their customers as you are to yours. We often talk about social media marketing as a way to build relationships between you and your customers – and big business can play that game – but as a small business owner you have the original social media on your side: proximity to your customers. You live in the same neighborhoods, go to the same soccer games and share in the future of your communities. Relationships walk through your doors Use those social connections to build your relationships to your customers and continue building them when they visit your place of business. “When was the last time you were greeted by the CEO of a big box retailer when you walked in their door?” Eric asks. An associate of mine used to own a small inn located in an emerging California wine producing valley. The sign coming into his town said, “Pop. 472.” Phone numbers were quite similar in this little area and people would often dial “wrong numbers.” However, because of the nature of the area and the people, there really never was a “wrong number.” More often than not, he would recognize the voice on the other end and they would end up chatting for 10 or 15 minutes. Locals coming into your business should never feel like the have the “wrong number.” Dollars spent locally From the consumer side of the small-business-big-box dichotomy, Eric says consumers should consider the complete picture, including both the financial and social impacts. “Ordering from Amazon may be easy, but remember that all your cash just left for Seattle,” he says, noting that for every $1 spent at a locally owned business, 67% stays within the community. That’s three times more than stays if that same $1 is spent at a chain store. “Think about which businesses support your local community the most– school auctions, nonprofits, programs that support the elderly – and make sure you in turn support them,” he urges. Be responsible citizens But be aware that this wraps back around to local business owners. You need to “exercise” your proximity to your customers by being in those places. Consider your neighbors through the years. There are those who pitch in when you forget to set out your garbage on pickup day morning and there are those you never see except occasionally in passing. Be a small business owner who is always ready with a helping hand. Engage your customers not only at your business, but in your community. Image: Image: AV Italian Restaurant, © 2007 David, used under a Creative Commons Attribution-ShareAlike...
read moreHey Startup! Want Funds in a Flash? Part I
“I don’t think we’re doing it better; I know we’re doing it better.” That’s the kind of confidence you always want to hear from someone who’s heading a startup and in this case the guy making the statement is Vincent Bradley, one of the co-founders of Flashfunders. The story of his company is especially interesting because Flashfunders is a startup for startups. There’s a lot to learn from the way Bradley and the team he works with have conceived and launched Flashfunders. But that’s not all: if you have a new business idea you’ve been longing to get started, their story might also open up an avenue for you to make it happen. Unlike Kickstarter First things first: Flashfunders is a crowdfunding site where accredited (high wealth) investors ante up seed money and get some ownership in return. It’s not another Kickstarter where you get a t-shirt or the promise of a product to be delivered at some later date. I started this with a rather bold statement from Bradley so let me tell you what Flashfunders is doing that gives him the confidence to make that claim. We’ll look at this from the side of the startups as well as the side of the investors. First, for startups to access real seed money, generally up to about $2.5 million, there’s a long list of regulatory and legal requirements they must meet. Bradley estimates that if a startup had everything else in order, it would probably cost about $10,000 to jump through all the hoops. The paperwork is done Flashfunders has essentially put together a “turnkey” system that startups can plug into (maybe instead of “turnkey” I should have said “plug-n-play” to avoid mixing metaphors, but I digress). It is also the only FINRA registered broker-dealer licensed to transact equity securities on the web. All the hard stuff that is really outside of most entrepreneur’s wheelhouse is already in place. Flashfunders has been able to pull this off because they are backed by Europlay Capital Advisors, who were the initial investors in Skype; and Stubbs Alderton & Markiles, the legal team for Beats, LinkedIn Series A & Skype. In other words, they are working with folks who have been through this a number of times. In the same way that Flashfunders hopes to provide a critical service to startups, it plans on meeting the demands of investors. “There are 8.5 million accredited investors in this country and right now less than 3 percent invest in startups and we think that’s a problem. It’s a problem for the companies (startups) and it’s a problem for the investors,” Bradley explains. Allows for diversification “Investors should be diversified and that includes having a piece of their net worth, a piece of their assets, in the venture class, so we want to open up access,” he continues. Flashfunders makes it easy for this group to invest directly in startups, unlike the model used by others. Investors can also pool their money and invest via funds. Do you see an opportunity for yourself here, either to get a new business going or invest some funds? Bradley has more to say, including what he and the team at Flashfunders look for to determine if a startup has a chance at successfully raising money. I’ll cover...
read moreRetailers Adjust Shipping Dates to Avoid Christmas Disappointment
If you remember last year’s Christmas Season headlines, you’ll recall that late deliveries caused a lot of embarrassment for some major retailers. They had guaranteed package deliveries in time for Christmas, but a perfect storm of natural conditions sent many of those promises to the dustheap of retail history. First, the Polar Vortex wreaked havoc on the transportation network. Trucks were bogged down on the highways, airports were closed, it was a nightmare for the shipping industry. Second, the shopping days between Thanksgiving and Christmas were far fewer than average and that made packages in the shipping pipeline get bunched up like a boa constrictor trying to digest a rabbit. Stores pulling back All of this has made retailers a little gun shy going into Holiday Season 2014. According to Shop.org’s eHoliday survey, retailers are pulling back their guaranteed Christmas delivery dates so that they expire at least a week before the kids wake up extra early and head to the tree. Almost 80 percent of those surveyed said they were going this more conservative route, compared to a about 74 percent last year. Also, those attractive “Order by December 19 and receive your package in time for Christmas” deals will be a little more scarce this year. Retailers making that ambitious promise are decreasing from 26.3 percent to 21.2 percent. The big lesson here is that you need to keep your Christmas promises, whether you’re a parent or a retailer. If your business relies on shipping for fulfillment, review the information you’re giving your customers and the commitments you are making. This can be a delicate balancing act: You need to balance competitiveness with worst case scenarios. Consider free or discounted upgrades for expedited shipping and see calendar dates such as “December 22″ as marketing opportunities: Order by December 22 and select our special rate two-day shipping to get your package before Christmas! Package tracking is a must Iffy weather in December also puts package tracking at a premium. Customers will want to know if their package is stuck in Chicago waiting for O’hare to reopen; it lets them make alternate plans. If tracking isn’t standard in your business, it probably should be and is certainly something you should add at no charge during the holiday crunch. Also, promptly communicate any snags to your customers. The flip side of this for local retailers is to be sure that you have sufficient stock on hand. Failing to have an advertised item is worse than receiving a package late due to a Nor’easter. The weather event is an act of nature, people eventually understand. Not ordering enough is a management problem. Every year the mainstream media reports on the importance of the holiday shopping season to retailers’ bottom lines. If you’re a retailer you understand that. Give this short, four-week shopping period the special attention it requires. You’ll still be thanking yourself in July. Image: “US Navy 060828-N-2716P-014 Postal clerks assigned to Fleet Mail Center, Yokohama, unload a truck of incoming mail so that it can be inspected, processed and distributed” by U.S. Navy photo by Mass Communication Specialist 1st Class Paul J. Phelps. Licensed under Public domain via Wikimedia...
read moreCustomer Service: How to School the Big Boys
It’s unquestionable that many large businesses are giving superb customer service and that’s why I’m so dumbfounded when I encounter the opposite. Here are two examples: As I prepared to leave a hotel recently I called for a bellman and requested a taxi. I waited for 15 minutes. Cue the crickets. I eventually wrestled my two suitcases down to the lobby where – surprise! – no one had any clue about the taxi. Further, no one took any interest in helping me handle all the stuff I was dragging along. That was an upscale hotel. Here’s a big box store example. A friend wanted to buy an expensive game console. There was no one in the department. He tracked an employee down who called for help. No one came. He tracked down another employee who called for help. Same (non)response. Humorously, at the end there were four employees in the department but none knew enough – or had the right key – to help. (On his way out of the store he passed another employee restocking a shelf while she chatted away on her cell phone.) Bigger is not always better Both of these horror stories happened at major national chains. Unfortunately, unless they are superbly managed, the customer service at these large national brands can vary tremendously. As bad as that is for customers, it’s good news for small business owners and also offers some important lessons. You might not be able to compete on price on some items with the mega-stores. However, you should be able to clean their clocks when it comes to customer service. Spend some time in the facilities of your biggest competitors and see what they are doing wrong and right. Refocus your business so you excel on both fronts. You don’t make their mistakes and you’re even stronger where they seem to be doing okay. It’s called excellence and Tom Peters went in search of it back in 1982. Be sure your customers and clients find it all throughout your organization. No time to relax However, don’t get too smug about the customer service misadventures of your bigger competitors. If you do well and grow your business, that could be you someday. See if you can relate to this: A favorite restaurant does well and opens a second location. After a year or two neither restaurant seems quite as good as the original. When you experience growth you must do two things: Maintain your company’s unflaggingly excellent customer service DNA, and Provide the systems that enable your employees to make great customer service a reality (not just a slogan). The first point requires personal dedication from the top. If ownership and management start to believe that customer service is a line-level responsibility, it’s game over. The tone must be set from the top. The second point requires training, empowering, supervising and retraining. It’s not a “once and done” event. In fact, if your customer service is not always improving, it will gradually decline. The second law of thermodynamics – the law of entropy – applies to human systems. They need to be constantly fed with new energy to keep them moving forward and prevent eventual...
read moreBusiness Greatness Requires Something ‘Extra’ – Here’s How to Do It
When I’m in New York there’s a restaurant that’s almost like my kitchen, I eat there so often. Once I casually mentioned how much I enjoy the Italian soup, pasta e fagioli. The next time I came in to eat, the owner stopped by my table to tell me they had made the soup for me. Do you know how special I felt and how impressed I was with the level of customer service at this restaurant? It was off the chart. There’s an old Creole word they use in New Orleans, “lagniappe.” It’s that special extra that a business owner throws in without your asking. You’ve probably experienced it and if you have, you know that sometimes we remember the lagniappe better than we remember the actual item we were originally shopping for. Rise above expectations The special batch of soup and the New Orleans lagniappe are both examples of business owners going “above and beyond” the minimum requirement to satisfy a commercial transaction. When I walked into the restaurant that evening, I wasn’t expecting my favorite soup and that made my dining experience go beyond expectations – literally in this case. What is your company’s lagniappe? How do you exceed expectations? Let’s quickly unpack the simple things the restaurant owner does right. It may help you find ways to go beyond your customer’s routine expectations. First, the restaurant owner engaged me. We had a conversation, a dialog. It went beyond the standard pleasantries of “How are you this evening?” or “Is everything fine here?” A real dialog took place. Second, the owner heard what I said and acted on it. Knowing how overworked restaurant owners are, I suspect that he quickly got pasta e fagioli scheduled for the next day’s menu; the probability of forgetting or becoming distracted is huge. In any case, he saw a way to please a customer and he didn’t let it slip away. Separating good from great Other good – but not great – owners would have heard my remark, replied with some comment and then moved on to the next thing. I suppose we should be glad that most business owners are satisfied with being good; it opens up greatness for the rest of us. However, we need to seize the opportunities that allow us to demonstrate why we are great and show our customers what makes us better than the folks who are satisfied with good. Finally, the owner “closed the loop” with me by telling me that they had made the soup with me in mind. Heck, maybe my next visit just happened to be on the day when they usually make a pot of pasta e fagioli! The important thing is that the owner remembered and took the time to engage me again. Recalling details about your customers is critically important, they let you develop a relationship that is deeper than the typical business relationship. That quality can often be the deciding factor when people are making choices about who they want to work with or who they recommend to their friends and business associates. “Ask for Mary, she’ll treat you right.” Are there any sweeter words in business? Image: Pasta e fagioli, © 2012 Wapster, used under a Creative Commons Attribution-ShareAlike...
read moreBeat Your Glossophobia – Fear of Public Speaking
I had a great talk recently with a woman who currently works for a major corporation but really wants to start her own business. One of the things holding her back is a very common phobia: she’s afraid to speak in public. She knows that to get her own firm up and running, she’ll have to pitch it to a wide range of people. She’ll have to sell the idea to prospects and also talk to groups to increase awareness of her brand. For many, standing in front of people and making a presentation is cause for immediate panic. But if you think a fear of public speaking dooms your chance at business success, I have two words for you: Warren Buffett. In his 20s, Buffett realized that to achieve the success he envisioned, he needed to be able to speak in public. “You’ve got to be able to communicate in life and it’s enormously important. Schools, to some extent, under emphasize that. If you can’t communicate and talk to other people and get across your ideas, you’re giving up your potential,” Buffet said during an interview for Levo League, a career website for young women. Buffet’s answer was to sign up for a Dale Carnegie course and the rest, as they say, is history. However, not everyone has a Carnegie Institute nearby, or can afford a course. Fortunately, there are other ways to overcome your fear of public speaking and also hone your presentation skills. Just do it. In every endeavor practice makes perfect. If entrepreneurship is in your future, start out by leading a local group, even if it’s the PTA. Volunteer for opportunities at your current job to make presentations – they don’t need to know that they’re giving you paid training for your future ventures! Join Toastmasters. The group has chapters all around the country; finding one near you shouldn’t be difficult. They also have a lot of online resources that should help kickstart your public speaking career. Grab the local junior college catalog. If you’re going to be investing your money in startups, invest a few evenings in yourself first. Find a night class in speaking. It’s a very low cost way to take those critically important first steps. Join a theatre group, acting class or workshop. All the world’s a stage and that includes the business world. Step outside of your comfort zone and find a way to inspire your inner thespian. Believe me, if you can get on stage and say a few lines in a local production of Our Town, you won’t have any trouble presenting your ideas to a group of potential investors. Take any of these roads to increased public speaking confidence and you may find that you open up a whole new career for yourself . I speak at events constantly and believe me, it is very rewarding. Try it, you’ll like it,...
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