Planning ahead

     Free daily tips, information and advice for people in small business

     from personal experience founding and growing several--been there, done that.

     Planning ahead--the two terms seem to be contradictory. Planning by definition concerns the future. 

     You don't plan "behind" and planning for "now" has already been done--consciously or not. 

     Planning ahead sorts through the possibilities of "if/then" and brings up some possible courses of action for you and your business.

     If the economy goes south, then I'll concentrate on certain products/services and de-emphasize the rest. If this type of advertising does not work, then I'll shift to alternatives. If a big box store opens in my town, then in my store I'll offer the things they don't carry.

     Example: Joel had time to plan ahead. Walmart announced some 18 months ahead that the company would be opening one of their big stores nearby. Joel feared for the future of his small town hardware store, and he soon arrived at a "planning ahead" decision. He decided to move from the cramped, in-town location to a suburban location on a main road. Simultaneously, he would change the direction of his business. Contractors and homeowners already came to Joel's place to rent the power tools and equipment they needed for a day or two. In the sprawling new location, Joel would have more room and could add more rentals. Today, Joel is in his new location, offering more and more rentals--including trucks and trailers. He has been able to add a part time repairman to keep the equipment shipshape. He still offers high quality hardware items and power tools for sale--concentrating on items not carried by Walmart. 

     Sometimes, owners of small businesses get comfortable with the business running itself. But the marketplace is continually changing. You already know how to plan ahead, but It can take an outside force to kickstart the big decisions.

     Example: Artists who paint pictures have a difficult time connecting with the buying public. Juan loved to draw. Growing up, he honed his skills producing endless pen and ink works. Gradually, he became fascinated with painting in oils. He showed some of his paintings at art shows and festivals. There was a great deal of interest, but sales were slow--not enough to support him. He noticed that his pen and ink drawings of homes, buildings, bridges and other structures sold well at shows. He did some planning ahead--he would concentrate on building a following for the pen and ink drawings, supporting him while he traveled the long road to transition to oil paintings. It's working. Doing pen and ink drawings is quick and easy for him. They bring in continuing income and give him the time to produce a backlog of oil paintings. Meantime, his reputation is spreading in the art world as an artist to watch.

     Sometimes, an interim plan can be the path to the goal you want to reach. Baby steps can be the way to get you where you want to go. 

     Eventual success in a small business might lead through a detour or two. But planning ahead and keeping the goal firmly in mind will guide you through.

     A lifetime of experience is distilled in these daily tips, information and advice for people starting up and running small businesses. Small business is the backbone of America--think hairdressers and pet groomers, chiropractors and accountants, cafes and neighborhood stores, auto repair shops and bakers. What would you do if all the landscapers and computer experts suddenly moved to Canada? You'd plan ahead, hunker down and figure out a new business to get into. This is what makes America great, not Washington with all its bloated bureaucracies feverishly writing more rules and regulations.  

        

Partial payments

     Free daily tips, information and advice for people in small business
     from personal experience founding and growing businesses--been there, done that.

     Some small businesses can increase sales by offering partial payments. It can be for products or services. Partial payments can be attractive to individual buyers as well as big companies. 

     Example: If your small business sells to big corporations, it is important to know the approvals structure in your customer's company. Frank runs a printing business and he uses the partial payments concept. His customers include banks, insurance companies, and large manufacturers. On different jobs, he might be dealing with with managers, vice presidents or senior officials. All of them have different levels of approval authority. In the case of lower level managers, they might be able to approve up to $500. As you move up the ladder, senior officials might be able to commit the company to a $50,000 order on their own signature. Frank works with his clients so that they can fit his invoices into their budget and approval authority. Sometimes this means splitting jobs into several pieces and billing them separately. Don't misunderstand--nobody's hiding anything here. It's simply working with existing responsibilities and authorities of clients. It's a way to put the partial payments concept to good use--to the benefit of buyer and seller. 

     A variation on the partial payments concept can be used by others--consultants for example. Here, the consultant and the client agree on a relationship, placing milestones on the work to be done. At the end of each milestone, work accomplished to that point is billed. Partial payments again work to the advantage of both parties.

     More examples: Layaway plans were once used extensively by retail stores--large and small. The layaway concept declined in use over the years, but recently it has enjoyed a resurgence in popularity. (1) A small furniture store offers customers layaway plans. Some customers like the discipline of breaking up the price of an $800 chair into four monthly payments--taking delivery when the total is paid. (2) Small jewelry stores can miss sales when they do not offer layaway, common at large jewelry stores and department stores these days. (3) Electricians, plumbers and other tradespeople can realize a better bottom line by quoting the overall job in pieces--breaking up a big job into components, each billed as it is completed. 
(4) Frank used progress payments in his printing operation (see main example above). Many large jobs were quoted in thirds--1/3 upfront when the job was defined and placed, 1/3 when a certain milestone was met, and 1/3 on delivery of the finished product. 

     Look for ways to put the partial payments concept--and its variations--to work in your business. Start by looking at your customers/clients and their problems.

     Frequently, partial payments can help them. Pleasing them by helping them solve their own problems brings them back to you--and it can generate referrals.

     All this helps you with your cash flow. And we know the importance of cash flow. 

     My lifetime of experience includes starting up and operating small businesses as well as counseling thousands of small business owners with their problems. This includes hands-on coaching at several Small Business Development Centers and running the Business Owners Institute in New Jersey. Free answers to your questions--email me at AlWarr16@gmail.com. Put BLOG as the first word in the subject line so I don't delete along with all those trying to sell me something. I never give out your email address, and your privacy is always respected. 

Changing direction

     Free daily tips, information and advice for small business
     from personal experience founding and growing small businesses--been there, done that.

     Yesterday's blog was about "business drift" that occurs when your business tries to go off in another direction. 

     Businesses are living entities. Like a child beginning to grow up, businesses always start showing a life pattern peculiar to themselves. As the parent, you must be ever watchful and guide them in the direction you think best.

     You can follow where the business is leading you, or you can decide on a better path. It's up to you.

     Changing the direction of your business is a big decision. I'm not talking about simply adding another service or product line. I'm talking a drastic change in direction.

     Example: A machine shop has spent many years supplying the needs of commercial clients--parts and components meeting specifications. Clients are in various industries, including medical devices, automotive, nuclear, aerospace and others. Suddenly, 3-D printing burst on the scene, a quantum leap in technology. The expensive computer-driven machining of parts was suddenly under challenge by the new kid on the block. The owner of the machine shop knew that his business might well be replaced in the future by 3-D printing. But it would take time for the new technology to achieve the fine tolerances and finished products now demanded by his customer base. Meantime, he could not ignore what was happening. He decided to expand into 3-D printing in a small way and ride the wave as the technology developed.

     Advances in technology can present opportunities for changing the direction of your business. So can market forces.

     Examples: (1) Cars once had hubcaps. They were supplied to vehicle manufacturers by small companies. When automobiles rolled off the production line, hubcaps were in place. Then, suddenly, various market forces dictated the end of the hubcap. (2) Not so many years ago, it was impossible to find gluten-free foods. Today they are everywhere--in response to market forces. (3) Clothing cleaning operations today must be prepared to deal with clothing impregnated at the manufacturer with micro-deodorants, as well as wicking weaves in garments. (4) Landscapers are faced with changing market forces when residential clients opt for the wildflower look instead of high-maintenance lawns. (5) Big companies today can call a small firm specializing in temporary personnel placement to get an accountant or engineer for a specific project, thereby avoiding the costs of adding a permanent employee.

     Market forces are everywhere. They continually change and they affect your small business. Be alert to market force changes, not only in your particular market, but to other industry segments as well. Otherwise, you can be blindsided. 

     Changes in technology and changes in the marketplace roll in almost daily. Frequently they are combined, and the resulting tsunami can wipe out that small business that's caught unaware. Keep up.

     Questions? Free answers to your small business problems. Email me at AlWarr16@gmail.com but you MUST start the subject line with BLOG. Otherwise, you'll be deleted along with all the others trying to sell me something. I never share your email with anyone else. Your privacy is always respected.    

Business drift

     Free daily tips, information and advice for people in small business
     from personal experience founding and operating businesses--been there, done that.

     Starting your business was hard. No doubt about it. Getting a business off the ground takes all your time and attention and strength and ingenuity, along with money and a dash of luck.

     Well, it was good to get all that behind me!

     News flash. It ain't ever behind you.

     Businesses drift. Your business drifts with the changing market. It drifts with the economy. It drifts with all this new social media. You're pulled this way and that.

     Example: Mary loved making women's hats. She loved designing them. She loved selecting different materials and using them in her hat making shop. She also loved to decorate the hats with all sorts of other things she made--pins, feathers, artificial flowers, beads and seasonal seeds. These additional items made the hats "pop" and led to sales, she believed. As time passed, Mary noticed that customers asked to buy the pin or other decoration, and they left the hat behind. She was happy to be selling things she had made. Soon, however, she got a wholesale order for 500 of her pins. She was suddenly in the pin business, and the hats languished on the displays. What had been the accessory now became the main product. Her business had drifted.

     Drifting into new markets can be exciting--and profitable. It's always a good feeling to get a whole bunch of new orders.

     Example: John had worked on computers since his teenage years. While he was still in college, he opened a small repair shop. People would lug their desktops to his place and he would get them back in operation. After college, John decided to concentrate on his repair shop, building his business. Then a strange thing happened. Customers asked if he would come to their place and set up networked computers. As he spent more and more time doing this, the word spread. Referrals brought in more business--away from his shop. Finally, he decided to go with the drift. He closed the shop, moved everything to a home office, and today spends all his time at other businesses--setting up, networking, training, troubleshooting.  

     Sometimes, you decide to go in the direction of the drift. Or maybe you pull back, refuse orders that take you out of your main business, and look for other ways to expand. It can be a time to re-think your original plan. 

     Whatever you decide to do, do it with your eyes open. Don't drift without watching. 

     I'm topping off a lifetime of personal experience in small business with this blog. Your questions are answered at no charge. Email me at AlWarr16@gmail.com and put BLOG in the subject line. Otherwise I'm likely to delete along with those trying to sell me something. Your privacy is protected--I don't give your email address to anyone, ever. 

Small bookshops

     Free daily tips, information and advice for people in small business
     from my experience founding and operating small businesses--been there, done that.

     I have fond memories of visiting a small bookshop in San Francisco when I lived there. No best sellers here, no how-to books, no popular novels.

     Instead, the shelves were lined with hard cover books published mainly by university presses--philosophy, Greek plays, history, political commentaries, Oriental and European classics. The owner was targeting a specific, though narrow, market. 

     When I moved to New York, I was confronted with stores that carried everything. You could find just about anything you might want in one of these big box bookstores.

     It was also a lesson in how markets can be tackled. Big box bookstores have sections that appeal to almost every interest, while small bookshops can take one particular interest and run with it.

     Examples: Several small independent bookshops are in my area, and they are showing how survival is possible in spite of the big box stores and e-books. 
     One store is active with local schools, holding book fairs twice each year, and bringing authors into classrooms to talk about their work and writing in general.
     Another store concentrates entirely on mysteries--thousands of mysteries, new and used, line the shelves and are promoted with email lists and social media. 
     Four of the bookshops in the area hold regular book signings, bringing authors from far and near to meet the public and talk about books in general and their book in particular.
     Another local bookshop offers thousands of out-of-print books, an extensive selection in all categories, but sold mainly over the Internet to people looking for a particular book.
     Two stores concentrate on books for children--from the very young to teens. Book clubs for young people are promoted in both these stores. Regular weekly or monthly sessions keep youngsters coming back for more. 

     Small independent bookshops are using all sorts of tools and techniques to meet the competition of the big box bookstores and the e-book revolution. It's a changing world. That means you have to run twice as fast just to stay in the same place. There is still a market for that small San Francisco specialty bookshop.

     My lifetime of experience founding and operating small businesses is at your disposal. Free answers to your questions--send to AlWarr16@gmail.com and put BLOG in the subject line so I don't delete. I'm not selling anything, and your privacy is always respected. 

Corporate vs. small

     Free daily tips, information and advice for people in small business
     from personal experience in founding and operating small businesses of my own.

     Leaving corporate America and starting your own business is difficult. I know. I did it myself.

     If you do this, be careful. Corporate America and small business are totally different. In fact, they occupy different planets, speak different languages, define different futures.

     Example: For 10 years I headed the Business Owners Institute in New Jersey. We helped many people establish their first business, and we helped many more dealing with the everyday problems of growing, finding financing, getting referrals, and any other operating problem they brought to the table. 
     A lady once walked in the door looking for advice on buying a franchise. She had taken a buyout from a major corporation, so money was not the problem. She ran a single idea past me--she wanted advice on buying a donuts franchise. I posed two groups of questions:
     1. Who will make the donuts at 4 a.m. when your employees call in sick--or simply don't show up that morning? Do you know how to run the coffee machines? 
     2. What are your personal interests and passions? What have you spent your time doing when you were away from your corporate position in the past?
     When she thought through the implications of those two questions, she decided against buying the donuts franchise. She went on to establish her own marketing consulting firm, helping other small businesses do what they were ill-equipped to do for themselves. We had a good laugh much later talking about how donuts are made.

     Corporate America does not prepare you for establishing and operating a small business. In corporate America you have company resources to call on--in small business, it's you. In corporate America you can call on the company's information technology people--in small business, it's you. You depend on the company sales force, production people, human resources, and all the rest. In small business, it's you. 

     You might enjoy what you do in corporate America, but you have all the company's capabilities at your disposal. In small business, you can only look in the mirror.

     My lifetime of business experience is at your disposal. My personal experience in founding and building small businesses of my own, along with years of advising others, is contained in this free blog. I will answer your questions at no charge. Email me at AlWarr16@gmail.com and put BLOG in the subject line so I don't delete. I never share your email, and your privacy is always respected.   

Getting referrals

     Free daily tips, information and advice for people in small business
     from my personal experience founding and growing small businesses.

     Referrals bring you the best new business. Jon refers Marie who walks in your door pre-sold.

     Well, not really sold. But ready to hear your proposal or give your products a favorable browse.

     So, how do you promote more referrals?

     Example: Getting my first business off the ground, I used a tip I learned from the insurance industry. Get in touch with current clients/customers and ask them for referrals. Do it about every three months. It worked. It kept me in touch with people who had bought services from me, and it reminded them to call again. I prompted them to mention me to others, and I asked for three referrals--people they knew who might use my services. Over the years, and in other businesses, I have refined this process, tailoring it to the changing times. These days, cell phones, networking and social media afford more options to keep in touch--and bring in referrals. When someone is nice enough to give you referrals, make certain that you follow through by calling or otherwise contacting the referrals. You already have your opening line--"Mary mentioned that you might be interested in what I do."

     Example: The owner of a retail store I know makes extensive use of Facebook. The store's specialty is women's clothing, along with accessories. Every day she snaps pictures of items in the store using her cell phone. She selects one or two and posts them on her Facebook page. The pictures grab the attention of her existing customers, and they in turn pass the pictures on to their friends. It results in referrals that extend the reach and it builds the business.

     Example: An ice cream store uses an older--but no less effective--method. Here picture postcards are used. One side of the postcard is covered with a colorful picture of a scrumptious ice cream concoction. On the other side is the name and address of the recipient, a stamp, and a simple message--"Bring this card in and get a dollar off anything you want. Or pass it to a friend." The store sends out a new card every month or so to the store's list. Many cards are returned to the store--by both existing customers and by new ones. The advantage of a postcard over Facebook is clear. Facebook gets a two-second viewing and perhaps passed on. The postcard gets kept, taped to the refrigerator or bulletin board, or passed on. That one dollar off ($1 off in big type) feels like money. 

     To build your business, you want to get as many referrals as you can. Think through ways that can work for you. And get busy. 

     I've spent a lifetime founding and growing small businesses. With this blog, I'm helping others with the problems of operating. You get advice from all sides, but always value the advice that comes from someone who has been there, done that. Only they have felt the acid burn of cash flow. If you have questions, email me at AlWarr16@gmail.com and put BLOG in the subject line so I don't delete. Your privacy is always respected and I do NOT give your email address to anyone.